The Federal Reserve: Neither Truly Federal Nor a Full Reserve
Do you know who issues the money in your wallet or purse? For readers located in the U.S., take a look at the top of any U.S. bills and you will find “Federal Reserve Note” printed along the top. In a small black circle on the left side of these notes, you will also see the words “Federal Reserve.” It is the Federal Reserve which issues all bank notes in the United States. To see just how much control the Federal Reserve has over the issuance of U.S. currency, see their webpage at this link. Yet who owns the Federal Reserve?
Though the Board of Governors of the Federal Reserve is categorized as an independent government agency, “The Fed” is not owned by the government. The Supreme Court stated that “instrumentalities like the national banks or the federal reserve banks, in which there are private interests, are not departments of the government. They are private corporations in which the government has an interest.” You can verify this by reading the court case at this link (case 406 F.3d 532) and going to Part II, paragraph 9. This case further states that “each Federal Reserve Bank is owned by the commercial banks within its district.”
It’s quite revealing that though the official website of the Federal Reserve contains a detailed description of the Federal Reserve that is over 20 pages in length, ownership of the Federal Reserve Banks is never even mentioned. Could it be that this information is conveniently withheld to keep the public from understanding who owns the banks which issue all U.S. dollars?
Though Federal Reserve Board members are appointed by the U.S. President and confirmed by the Senate, the Federal Reserve is a privately owned institution controlled mainly by large private banks. Once board members are appointed, the U.S. government has no control over their decisions other than the president’s ability to remove a board member.
Yet a study of the history and functions of the Federal Reserve reveals that powerful bankers such as J.P. Morgan have had inordinate power and control over the formation and management of the monetary policy of the United States through their power over the Fed. Congress has virtually no influence over this incredibly powerful institution.