Text Box: I’m a volunteer to be appointed Chairman of the Federal Reserve Board of Governors because I have solutions to our country’s financial problems. My main solution is to un-privatize the Federal Reserve but that requires an act of Congress. Another solution is to appoint a patriot of the Republic of the United States of America as Chairman Governor. That position combines enough power and independence over the money supply and interest rates to bring prosperity to our population, strengthen the dollar, and reduce the National Debt. The fact that our population is experiencing the opposite of prosperity, a weak dollar and an increasing National Debt indicates past Chairman Governors may have been patriots of the stockholders of the Federal Reserve Bank corporations. The Federal Reserve Act was written to allow the Chairman Governor to be independent and thereby allow a choice of loyalty. Below are a few excerpts from the Federal Reserve Board of Governors “Frequently Asked Questions” web site. It explains the independence of the Federal Reserve Central Bank System. The blue print is taken from their web sit at: www.federalreserve.gov/generalinfo/faq/faqfrs.htm#1. When was the Federal Reserve created? The Federal Reserve was created on December 23, 1913, with the signing of the Federal Reserve Act by President Woodrow Wilson. The act had been drafted as House Resolution 7837 by Representative Carter Glass (D-VA), incoming chairman of the House Banking and Currency Committee. Here’s my comment. The Federal Reserve Act was pushed through the 1913 Congress on Tuesday, the day before Christmas Eve. It was then run over to President Wilson and he signed it the same day. That act was worth trillions of dollars because it privatized the functions of the U.S. Treasury. It appears those who benefited wanted to get it secured as fast a possible. Un-privatizing the functions of the U.S. Treasury by un-privatizing the Federal Reserve System is the purpose of this manuscript. The 1913 Congress and President Wilson signed that Act and we are stuck with it today. How is the Federal Reserve System structured? (Part 1) The Federal Reserve System has a structure designed by Congress to give it a broad perspective on the economy and on economic activity in all parts of the nation. It is a federal system, composed basically of a central, governmental agency--the Board of Governors--in Washington, D.C., and twelve regional Federal Reserve Banks, located in major cities throughout the nation. These components share responsibility for supervising and regulating certain financial institutions and activities; for providing banking services to depository institutions and to the federal government; and for ensuring that consumers receive adequate information and fair treatment in their business with the banking system. I have come to the conclusion that the term federal is used to mean a government of governments. The term depository institution refers to neighborhood banks found in cities and towns. They are “Member banks” of the Federal Reserve System. Member banks are required to purchase stock in one of the twelve regional Federal Reserve Banks as a membership fee. This is fine, OK, acceptable to me and I don’t want to change that part of the Federal Reserve Act. Within the meaning of this manuscript the term “stockholder” doesn’t include Member banks or the membership fee stock they are required to purchase. When I refer to stockholders in this manuscript it pertains to stock that is not membership fee stock. That stock is the subject of the Chapter 2. How is the Federal Reserve System structured? (Part 2) A major component of the System is the Federal Open Market Committee (FOMC), which is made up of the members of the Board of Governors, the president of the Federal Reserve Bank of New York, and presidents of four other Federal Reserve Banks, who serve on a rotating basis. The FOMC oversees open market operations, which is the main tool used by the Federal Reserve to influence money market conditions and the growth of money and credit. Tricky wording The Federal Open Market Committee (FOMC) was originally called the Federal Advisory Council. The section of the Federal Reserve Act that established it is stated below. It sounds like Open Market Operations is based on committee vote but it is not. The idea is to read the section like a lawyer protecting a client. Federal Reserve Act Sec 12.1: The Federal Advisory Council shall have power, by itself or through its officers, (1) to confer directly with the Federal Reserve Board on general business conditions; (2) to make oral or written representations concerning matters within the jurisdiction of said board; (3) to call for information and to make recommendations in regard to discount rates, rediscount business, note issues, reserve conditions in the various districts, the purchase and sale of gold or securities by reserve banks, open market operations by said banks, and the general affairs of the reserve banking system. What is actually stated is the Federal Advisory Council “shall have power…to make recommendations”. The reality is the Chairman Governor if the Federal Reserve, as the active executive officer has the power to make the decisions and all other board and council members have to go along. I have read the notes and minutes of many of the meetings and it appears to me that the Chairman Governor has an unknown purpose and makes his decisions regardless of arguments of the majority. One fact is for sure and that is a mathematic formula is not used as decision criteria but it should be. The finance of a great nation should be based on reproducible mathematic logic and not the personal opinion of one person. What is the Federal Reserve System? The Federal Reserve System, often referred to as the Federal Reserve or simply "the Fed," is the central bank of the United States. It was created by Congress to provide the nation with a safer, more flexible, and more stable monetary and financial system. Over the years, its role has evolved and expanded. To help you understand who I am, here is my response, “Did the 1913 Congress meet their goal of safety and stability in our monetary system?” As I reflect, unless they planed for more flexible ways to create housing inflation, stock market inflation of price-earnings ratios, depressions, recessions, mutual fund crashes, gas price increases, reasons for bankruptcy, homeless people, weakening the dollar and growing the national debt over 95 years, I’d have to respond the 1913 Congress screwed up big time. Their big mistake was allowing our central bank to be independent. Here is the Board of Governors web site response. Why did Congress want the Federal Reserve to be relatively independent? The intent of Congress in shaping the Federal Reserve Act was to keep politics out of monetary policy. The System is independent of other branches and agencies of government. It is self-financed and therefore is not subject to the congressional budgetary process. Ha, ha, ha, I always get a laugh out of that line. Congress intended to keep politics out of monetary policy by giving away all their power to money including a source of self-financing income. It still makes me laugh, and then I end up making a “What the fuck were they thinking” facial expression. Hey, the subject is national money and power, and trusting independent central bankers not to take advantage of their position, now is the time to use that term. According to the 1787 U.S. Constitution, an “independent” “self-financed” monetary system “not subject to the congressional budgetary process” has no place in our constitutional government. Only Congress may coin money and regulate the value thereof. To coin money is to make a “new unit of exchange” whether gold, paper, plastic, checkbook or electronic. The unit of exchange is the dollar. The dollar is a unit of money. Money is the scale used to measure human effort in relation to goods and services. On Earth, all goods and services require human effort. A little less than one ounce of gold was needed to coin a Constitutional twenty dollar Double Eagle in 1913. Today one ounce of gold costs eight hundred Federal Reserve Dollars. That means Federal Reserve dollars coined by an “independent” “self-financed” monetary system “not subject to the congressional budgetary process” are roughly forty times less valuable dollars. That’s why we have price inflation each year. This means that forty times more Federal Reserve “units of exchange” were added to the economy than goods and services were added to the economy. The quantity of Federal Reserve dollars keeps going up because the “independent” “self-financed” Federal Reserve makes a profit renting those dollars for interest to Congress. There are three unexpected words used in the 1913 Federal Reserve Act that have no business in an Act of the U.S. Congress and those are: franchise, corporation and stockholders. I had the “What the…?” facial expression the first time I read each of those words. The next three sections explain why the Board of Governors web site says the Federal Reserve System is independent. Their independence has to do with the three words: corporation, stockholders and franchise. “Independent” Corporation Finding the word “corporation” in the Federal Reserve Act blew me away. Federal Reserve Act, Sec. 4.4: “Upon filing of such certificate with the Comptroller of the Currency as aforesaid, the said Federal reserve bank shall become a body corporate and as such, and in the name designated in such organization certificate, shall have power—”. This section goes on to list the power and privileges granted to the corporation. The sixth privilege listed established the corporation as a self-governing entity. Federal Reserve Banks, General Corporate Powers, Sec 4.4 Sixth. “To prescribe by its board of directors, by-laws not inconsistent with law, regulating the manner in which its general business may be conducted, and the privileges granted to it by law may be exercised and enjoyed.” A corporation is an organization that is governed by laws that are called by-laws. The by-laws regulate the manner in which the business is governed. I have always been stunned that the privileges granted to the Federal Reserve Corporation “may be exercised and enjoyed”. I always thought it should say that the privileges granted to the corporation should be carried out for the benefit of the general public of the Republic United States of America. But there is no such statement anywhere in the Federal Reserve Act. In other words this corporate government has no fiduciary responsibility to the people of the elected government of the U.S. The Federal Reserve Corporation is at liberty to govern itself just like a business that has zero privileges granted to it by law. “Independent” Stockholder The word “stockholder” is written ten times and the word “shareholder” is written five times in the Federal Reserve Act and there is an entire section called “Division of Earnings”. I originally assumed the purpose of stockholders was to gather gold to loan to the government. It turns out that’s a wrong assumption. The United States of America is not on the gold standard because the Federal Reserve System was designed not to use gold. It’s designed as a checkbook and paper money system. Therefore the Federal Reserve System never needed stockholders and still doesn’t because stockholder gold is not needed. The Federal Reserve note is money and in 1913 when the stockholders were organized into a corporation there were zero Federal Reserve notes. So the stockholders didn’t provide Federal Reserve notes. That means they weren’t needed. Here’s a question for you. If there were zero Federal Reserve notes in 1913 then where did the nine trillion Federal Reserve notes borrowed by the National Debt come from? “Independent” Franchise Finding the word “franchise” in the Federal Reserve Act really surprised me. I thought of a “franchise” in terms of hamburgers. It turns out the first franchises were granted by a King. The King would grant special privileges, rights and power to individuals that served him. For example a franchise was granted to the Bank of England as a tax collector. The rights and privileges to become a National Bank in the 1800’s were called a franchise. The privileges granted to a Federal Reserve Bank are still a franchise. Federal Reserve Act, Sec. 4.4 Second. “To have succession for a period of twenty years from its organization unless it is sooner dissolved by an Act of Congress, or unless its franchise becomes forfeited by some violation of law.” The Federal Reserve franchise is coming up for its fifth renewal in 2012 and that will be the stockholders one hundred year anniversary. The concept of the franchise, corporation and succession was taken from the Bank of England Corporation Charter. The word “succession” in the Charter means to assign or transfer the uses and advantages, privileges and powers to heirs, successors or assignees. That is a way to say the capital stock is passed on. The privileges, advantages and powers passed on to their heirs are the franchise. The following section from the Charter will give you an idea of the stockholder’s franchise as tax collectors. The Charter of the Corporation of the Governor and Company of the Bank of England 1694: There shall be throughout the said kingdom of England, dominion of Wales, and town of Berwick upon Tweed, raised and levied, collected and paid unto us, our heirs and successors, for beer, ale, cider and other liquors, certain additional rates of duties and excise, …and be called one body politic and corporate …by the name of The Governor and Company of the Bank of England. We do, for us, our heirs and successors, make, create, erect, establish, and confirm for ever, by these presents, …they and their successors shall have perpetual succession, …and use a common seal, for the use, business, …of the said body politic and corporate, …they and their successors in all times coming, shall be able and capable in law, to have, take, purchase, receive, hold, keep, possess, enjoy, and retain to them and their successors any manors, messuages (house), lands, rents, tenements, liberties, privileges, franchises, hereditaments (portable property), and possessions whatsoever, and of what kind, nature, or quality soever; …to purchase and acquire all goods and chattels (personal property) whatsoever, …and also to sell, grant, demise, alien, and dispose of the same… And by the same name, they and their successors shall and may sue and …be sued and…answer and defend, …in courts of record… The stockholders of the Bank of England enjoy the franchise of collecting duties and excise taxes and pay themselves “a piece of the action”. The original shares of capital stock issued in 1694 that established the Bank of England are in the process of perpetual succession forever. The same thing is happening to the stock of the Federal Reserve Banks. I joke that the kids own our central bank and receive the benefit of “a piece of the action” from citizens of the United States as dividends from their fathers initial investment almost one hundred years ago. This might be where the term “old money families” come from. Those are Lucky kids. They were born to reap the benefits from the human effort of the citizens of the U.S. But unlucky citizens, we were born to serve the kids and give them an easy life by living off our efforts. That’s the system we were born into. Lucky our system is a republic because that makes it easily to change. The hard part is to get a majority of Congress to understand the situation and vote to change it. “Self-financed” This section explains why the Board of Governors web site says the system “is self-financed and therefore is not subject to the congressional budgetary process”. Two separate entities are self-financed. One entity is the Federal Reserve Banks. From the Federal Reserve Act section 1.3, “the term “reserve bank” shall be held to mean Federal Reserve Bank”. These are the bank corporations that are independent franchises owned by stockholders. The other entity that is independent of the congressional budgetary process is the Board of Governors. This is the regulatory board appointed by the President to watch over and regulate the corporate stockholders. The Board of Governors is not subject to Congressional budgetary process because the corporate stockholders pay them. The corporate stockholders of the Reserve Banks are independent from the congressional budgetary process because they make a profit and they keep it. Here is the current May 26, 2008 version of the Federal Reserve Act as posted on the Federal Reserve web site, www.federalreserve.gov/GeneralInfo/fract/sect07.htm. Division of Earnings Sec. 7: Dividends and Surplus Fund of Reserve Banks (a)(1)(A) After all necessary expenses of a Federal reserve bank have been paid or provided for, the stockholders of the bank shall be entitled to receive an annual dividend of 6 percent on paid-in capital stock. (B) The entitlement to dividends under subparagraph (A) shall be cumulative. (2) That portion of net earning of each Federal reserve bank which remains after dividend claims under subparagraph (1) (A) have been fully met shall be deposited in the surplus fund of the bank. The “surplus fund” is the profit fund. It’s normally referred to as capital stock and surplus. This section says that all expenses are paid first. Then second, a six percent dividend is paid on capital stock owned by the stockholders. Then third, the rest of the net earnings are paid into a surplus fund that is a profit fund. “Surplus” is listed on the Reserve Bank consolidated balance sheet as “Net Equity” otherwise known as owner’s equity, otherwise known as owner’s property. The net result is the stockholders keep all the profit from the Federal Reserve System. The original 1913 version of this section included a franchise tax that was removed in 1919. The excuse used to remove the franchise tax was because the word tax was used and the Federal Reserve stockholders are tax-exempt. The tax-exempt section below hasn’t changed from the original 1913 version. Division of Earnings Sec. 7: Exemption from Taxation (c) Federal reserve banks, including the capital stock and surplus therein, and the income derived therefrom shall be exempt from Federal, State, and local taxation, except taxes upon real estate. “not subject to the congressional budgetary process” The second entity that is not subject to the congressional budgetary process is the Board of Governors. This is the Board appointed by the President that is responsible for regulating the Reserve Bank corporate stockholders. The Chairman Governors is the chief executive and that’s the job I’m prospecting for. This section explains how the Board of Governors is not subject to congressional budgetary control. The Board of Governors is supposed to be part of the elected government but ended up being paid by the independent corporate government. The President of the United States appoints the Board of Governors but has almost no control afterwards. The Board of Governors has no fiduciary responsibility to the U.S.A. stated in the Federal Reserve Act. Although the elected government establishes their base salary rate it is actually the stockholders of the Reserve Banks that pay the Board of Governors as an expense. The Board shall levy an assessment to pay expenses and the salaries of its members and employees. Federal Reserve Board, Sec.10.3: “The Federal Reserve Board shall have power to levy semiannually upon the Federal reserve banks, in proportion to their capital stock and surplus, an assessment sufficient to pay its estimated expenses and the salaries of its members and employees…” This assessment means the Board of Governors has to make sure the Federal Reserve Banks (Reserve Banks) make a profit so they can be paid. One source of profit is the Board of Governors sets “the charge which may be imposed for the service of clearing or collection rendered by the Federal reserve bank” (Federal Reserve Act Sec. 16.3). The main source of profit is through loans. Many times loans are called “Advances”. The interest rate that can be charged is called the “Discount rate”. Their profit margin is called the “discount rate”. The name “discount” is misleading and leads the public to the wrong assumption. The Reserve Banks don’t give a “discount”. The opposite occurs because the Reserve Banks take the “discount” from the public and business. The public doesn’t use the term “discount” instead we use the term interest rate and businesses use the term “cost of money”. There is some confusion about the Board of Governor’s pay because of the way the Federal Reserve Act is written. This act was adapted from previous acts in the 1800’s. Although section 10.3 states the Board of Governors is paid by an assessment levied against the Reserve Banks, the amount of salary is stated in section 10.1 as $12,000. In previous financial acts the salary was stated and then the U.S. Treasury was ordered to pay the amount in gold coin or issue a voucher. A voucher is like a checkbook system used by the U.S. Treasury. The assumption is that because the salary is stated in section 10.1 that means that the democratic government pays the Board of Governors salary and therefore the Board of Governors is loyal to the elected government but that assumption is not correct. The Public also assumes the Board of Governors are restricted from profiting in the stock market because they “grant by special permit to national banks … the right to act as trustee, executor, administrator, or registrar of stocks and bonds under such rules and regulations as the said board may prescribe”. We are sure they want to avoid a conflict of interest. That too is an incorrect assumption. According to Board of Governors web site, as employees of the office of the Board of Governors, the individual members are employees and are allowed to own and trade most corporate stock found on the Over-The-Counter, NASDEQ and New York stock exchanges. Although paid by assessment established in section 10.3, below is section 10.1 from the original 1913 version that established the annual salary for the Board. Another conflict of interest surfaces in this section and it concerns the Comptroller of Currency. 1913 Federal Reserve Act, Section 10.1 The five members of the Federal reserve Board appointed by the President and confirmed as aforesaid (by and with the advice and consent of the Senate) shall devote their entire time to the business of the Federal Reserve Board and shall each receive an annual salary of $12,000, payable monthly together with actual necessary traveling expenses, and the Comptroller of the Currency, as ex officio member of the Federal Reserve Board, shall, in addition to the salary now paid him as Comptroller of the Currency, receive the sum of $7,000 annually for his services as a member of said board. In addition to his regular salary as a civil servant of the United States government the Comptroller of the Currency gets paid an extra $7,000 to serve the Board of Governors. The Comptroller of Currency is the chief officer of the Treasury bureau charged with the execution of all laws passed by Congress relating to the issue and regulation of national currency. National currency is technically a “circulating note in blank”. The public knows it as a Federal Reserve note. Below is a section where it is beneficial to the stockholders of the Reserve Banks to have the loyalty of the Comptroller of Currency. Federal Reserve Act, Penalty for Violation of Act by National Banks Sec 2.6: Any noncompliance with or violation of this Act shall, however, be determined and adjudged by any court of the United States of competent jurisdiction in a suit brought for that purpose in the district or territory in which such bank is located, under direction of the Federal Reserve Board, by the Comptroller of the Currency in his own name before the association shall be declared dissolved. It is odd that noncompliance of the Federal Reserve Act is not prosecuted through the United States Judiciary system but by the Comptroller of Currency in his own name. It’s a way to get around the U.S. Constitution and our elected government. This allows the stockholders of the Reserve Banks to use the power of the U.S. government without being controlled by the elected U.S. government. The common assumption is the Federal Reserve System is equitable because the President appoints the Board of Governors and Comptroller of Currency. But they all receive money from the Reserve Bank corporation stockholders. The President receives campaign contributions. The Comptroller of Currency receives an extra $7,000 and the Board of Governors receives all of their paycheck as a business expense paid by the Reserve Banks. Then the Reserve Banks stockholders get to keep all the profit they made from the citizens of the United States as dividends and surplus. In addition, the dividends and surplus is tax exempt. This is why the Federal Reserve “system is independent of other branches and agencies of government. It is self-financed and therefore is not subject to the congressional budgetary process.” One Country with Two Governments The 1913 Federal Reserve Act created a two government system. One is elected and the other is corporate. The United States has been one country with two governments ever sense. One government is rich and other government is poor. The House of Representatives, Senate and the President are the poor elected government. The corporate stockholders with the government franchise to own the U.S. central banking system is the rich independent government. The poor elected government never has enough money while in contrast the rich independent corporate government never runs out of money. Money is a Legal Document Money in the U.S. is called the Federal Reserve Note (Fed note). It has “legal tender” written on it. That means it’s a legal document that has to be accepted in exchange for goods and services. Because all goods and services require the input of human effort, it can be said that the Fed note is a legal document entitling the holder to human effort. The Federal Reserve Act is designed for the independent corporate government to make a profit from issuing the legal document called the Fed note. In essence that means the corporate government makes a profit from the human effort of the population of the United States. In case you wonder “How come the independent government nerve runs out of money to loan?” One of the reasons is in the Federal Reserve Act section 16, “Because the Fed note is issued at the discretion of the Board of Governors.” Notes Issued Sec. 16: “Sec. 16. “Federal reserve notes, to be issued at the discretion of the Federal Reserve Board (of Governors) for the purpose of making advances to Federal reserve banks through the Federal reserve agents as hereinafter set forth and for no other purpose, are hereby authorized. The said notes shall be obligations of the United States and shall be receivable by all national and member banks and Federal reserve banks and for all taxes, customs, and other public dues.” It’s easy not to run out of money to loan if Fed notes are “to be issued at the discretion of the Federal Reserve Board of Governors…”. In the old days of the gold standard the amount of money issued was limited to an amount of gold. Since the 1913 Federal Reserve Act money is issued at the discretion of this group of five men. This group of men is independent of the elected government and they have no fiduciary responsibility to the citizens of United States of America. It is natural for their loyalty to be with those who pay them and corporate stockholders of the Federal Reserve Banks pay them. This independent group of men formed into the Board of Governors has already used their discretion to issue nine trillion legal documents called the Fed note that forms the National Debt of the United States. The Fed notes were loaned to our elected Government for a profit. The United States pays interest to borrow Fed notes as the National Debt even though, “The said note shall be obligations of the United States”. This is when thinking our system is a gold system without the gold costs us big time. As members of the Republic of the United States changing the privilege for the Board of Governors to issue Fed notes at their discretion and loan the Fed notes to our elected government would be very beneficial. Discretion to “advance” the National Debt “Federal reserve notes, to be issued at the discretion of the Federal Reserve Board (of Governors) for the purpose of making advances…”. The word “advance” is misleading and is at the heart of the Federal Reserve System. To “advance” is to make a loan. It’s used in the sense that income expected in the future is “advanced” (loaned) in the present. “Advances” are made in exchange for collateral. From the Boards’ point of view Fed notes go out as an “advance” and collateral comes in as payment. The best collateral in the world are U.S. Treasury Bonds and Notes. They are made up in expectation of collecting taxes in the future. The process of making up a legal document out of nothing is called “to issue”. To make up a new Treasury Bond or Note or Federal Reserve Note (Fed note) is “to issue” it. To “issue a new Fed note is the same as “coining new money”. It is not gold and it is not a coin but the Fed note is money and it is formed into money at the discretion of the independent Federal Reserve Board. This is in direct contradiction to our U.S. Constitution that states only Congress shall coin (new) money. In 1913 there were zero Fed notes. The new money was Fed notes and the elected Congress didn’t have any to pay government expenses. The method for Congress to receive Fed notes is to borrow them from the Federal Reserve. The procedure is for the U.S. Congress to issue a legal document called a Treasury Bond. The Federal Reserve Board of Governors then issued the legal document called the Fed note. The legal document called the Fed note is exchanged for the legal document called the Treasury Bond. Exchanging Treasury Bonds for Fed notes is how the National Debt is borrowed. A significant difference between the legal documents called the Fed note and Treasury Bond is the Treasury Bonds pay a three percent interest to the holder, as stated in section 18 of the Federal Reserve Act. This means the National Debt of nine trillion pays an annual interest of two hundred seventy billion in legal documents called the Fed note. The Fed note has “legal tender” written on it and is accepted in exchange for goods and services. Since all goods and services require human effort it can be said that two hundred seventy billion in human effort of the United States is paid each year because the poor elected government borrows its own legal documents from an independent corporation. Borrow from the Public Here is a special message for professors of finance and economics. I’m guessing they are disagreeing right now because they were taught the intent of the Federal Reserve Act is to borrow from the public. If the Federal Reserve is actually borrowing from the public then the balance of Fed notes held by the public should be zero. The logical steps are below. First, in 1913 there were zero Fed notes. Second, the Board of Governors issued nine trillion Fed notes and exchanged them with Congress for nine trillion Treasury Bonds. Third, Congress took the nine trillion in Fed notes and exchanged them with the public for goods and service. Then there was nine trillion Fed notes in public hands. Fourth, Federal Reserve Open Market Operations is supposed to borrow from the public by exchanging the nine trillion in Treasury bonds for the nine trillion in Fed notes. Fifth, if this were the case then the public should have nine trillion Treasury Bonds and zero Fed notes. But that is not the case. This is the point in the system where the Board of Governors could have canceled the issue of nine Trillion Fed notes and the money supply would be at the 1913 level. Because the Federal Reserve is organized as an independent corporation the stockholders can legally keep the Fed notes for themselves as free money. The other choice is Federal Reserve Open Market Operations is thought to exchange the Treasury Bonds with foreign governments for gold. If that’s the case then the Federal Reserve must be keeping the gold because the U.S. Treasury doesn’t own gold to support and strengthen the dollar. It appears the independent government may be receiving free Fed notes and gold. Financial statements that balance to the National Debt are not provided by the Board of Governors. A financial statement balancing to the National Debt would be helpful in determining who makes a profit from the issue of Fed notes. Chapters Three, Four and Five of this manuscript expands on Fed note issuing policies stated in the Federal Resave Act. Chapters Six and Seven explains the effect Monetary policy and Open Market Operations has on the Fed note supply and credit supply. Chapter Two, Who Owns the Federal Reserve, identifies the small group of stock held by the rich independent government. Those are the ones with a monopoly to deal with the Treasury. Incase you are not sure, the term Treasury means the U.S. Treasury. Our Treasury is part of the poor elected government who never has enough money. The Independent Question The question, “Why does the rich independent government want to stay independent?” The answer is, “If they are independent they get free money, goods and services and power”. I’d say gold but I think they got all of that already. When the elected government figures out what’s happening then the elected government can stop issuing Treasury notes in exchange for Fed notes. That’s when the rich independent government looses its privileges. It’s worth billions and billions to the stockholders of the Federal Reserve Banks to keep their corporate franchise and remain independent. It’s helpful to them that our elected government has so many wrong assumptions and misunderstandings about the Federal Reserve Act. I’m hoping professors of finance and economics will come together and eliminate our misunderstanding about the system the Federal Reserve Act allows. Then our elected government can come together and re-form us into one country with one government under the Constitution of the United States of America. End Chapter 1 http://www.federalreserve.gov/generalinfo/faq/faqfrs.htm#1 http://www.federalreserve.gov/generalinfo/faq/faqfrs.htm#7 Federal Reserve Act, Division of Earning Sections 7 Federal Reserve Act, Federal Reserve Banks Section 4 Federal Reserve Act, Section 8 http://en.wikipedia.org/wiki/federal_Reserve_System#Balance_sheet balance sheet as of May 15, 2008. Federal Reserve Act, The Federal Reserve Board shall be authorized and empowered section 11 (k) http://www.federalreserve.gov/generalinfo/faq/faqbog.htm Is it legal for Board employees to own stock or to trade in the market? May 14, 208 http://www.federalreserve.gov/generalinfo/faq/faqfrs.htm#1 http://www.federalreserve.gov/generalinfo/faq/faqfrs.htm#5 Federal Reserve Act, Section 4 Federal Reserve Banks Federal Reserve Act, Section 4 Federal Reserve Banks, First Federal Reserve Act, Section 4 Federal Reserve Banks, Second Federal Reserve Act, Section 4 Federal Reserve Banks, Third Federal Reserve Act, Section 4 Federal Reserve Banks, Fourth Federal Reserve Act, Section 4 Federal Reserve Banks, Fifth Federal Reserve Act, Section 4 Federal Reserve Banks, Sixth Federal Reserve Act, Section 2 Federal Reserve Districts 1913 Federal Reserve Act section 2 http://landru.i-link-2.net/monques/currencyact.html#NATIONAL, National Currency Act (later called “National Bank Act”) June 3, 1864 section 31, page 14.