Over the years, on my trips to the local bank, I’ve watched people take their valuables to their vault, confident that the small or large safe rented on the premises would be the most secure place they could possibly keep their coin collections, jewels, extra cash, a valuable wine bottle, deeds of trust, a power of attorney, baseball card collection, Grandma’s pearls and diamonds, and many other unusual collector items. Who could possibly have access to their property as long as they had a key and paid their monthly rental dues?
There are those who do not trust banks and their operating hours – they buy expensive home safes, relatively easy to crack, or not-so-secure ones that determined thieves can carry out of the house undisturbed.
How safe are your valuables in the bank? After the 9/11 terrorist attacks, underground vaults in New York affected by the intense heat and smoldering fire that burned for weeks before they were accessed, did not fare so well. Documents were pulverized, pearls burned to a crisp, coin collections, jewelry, and ingots melted into a large mess, and everything else was charred so badly as to not be recognizable. Even Canadian silver ingots stored with the Federal Reserve Bank of New York melted. Heavy security guarded the area until the cache could be recovered safely from the underground caged deposits.
Technically, a bank is a private corporation with shareholders, whose interests are the primary purpose of its existence. A bank exists to make money for its stockholders. The depositors are just an inconvenience, customers whose money is used by bank employees to create more money for the bank and its owners. The depositors must pay a monthly fee for the privilege of lending money to others with little or no return on their deposit if you take into account the inflation rate. Rental safe deposit boxes take up precious space in the bank vault.
There is a plaque in Venice reminding passers-by of the fine and punishment for engaging in usury. Following into the footsteps of a Venetian condemned for usury, I crossed the Bridge of Sighs (tiny windows offered a convicted felon a last view into the gorgeous Venetian bay) from
Palazzo dei Dogi, where the court and the Senate were located, into the dungeons of the
prigione (prison) – it was a damp, dingy, dark, cold, humbling, and creepy experience.
Banking had become so dishonest that the tiny Venetian city-state ruled by a doge and a Senate, passed a law in 1361 that forbade bankers to use depositors’ money for their own interests - they had to allow the public to inspect ledgers and the actual deposit of coins.
In spite of the mentioned precautions, the bank of Pisano and Tiepolo lent money against reserves and could not meet depositors’ demand for their money in 1584, thus closing. We call this today a run-on-a-bank.
The government established the Banco della Piazza del Rialto (The Bank of the Rialto Square), named after the famous Ponte Rialto (Rialto Bridge) in Venice, one of the commercial points in Venice still in use today. The Banco della Piazza del Rialto was not allowed to make money from lending. “The bank was required to sustain itself solely from fees for coin storage, exchanging currencies, handling of transfer of payments between customers, and notary services.” (G. Edward Griffin, The Creature from Jekyll Island, p. 171)
A second example of honest banking was the Bank of Amsterdam, founded in 1609. G. Edward Griffin also describes the honest Bank of Hamburg as having excess reserves of silver deposits held against bank liabilities when Napoleon Bonaparte took control of the bank in 1813. (The Creature from Jekyll Island, p. 173)
Napoleon did not trust bankers and established the Banque de France (Bank of France), naming himself president. Bank of Prussia became the Reichsbank (the Empire’s Bank). The central bank system such as Reichsbank and Banque de France became very attractive to politicians and billionaires, eventually giving birth to our “central banking system,” the Federal Reserve System (Fed) in 1913.
John Maynard Keynes, the guru of Keynesian economists of the 20th century wrote about Lenin’s criticism of capitalism, “Lenin is said to have declared that the best way to destroy the Capitalist System was to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method, they not only confiscate, but they confiscate arbitrarily; and while the process impoverishes many, it actually enriches some.”
Lenin, Stalin, Mao, Castro and other past or present communists and Fabian socialists engaged and still do in the same collusive currency debauchery with banks, creating inflation in order to steal wealth from their citizens.
Our own Federal Reserve System is not a bank, is not federal, and is not a reserve. It is a cartel of powerful individuals who have convinced Congress and the public that it is an agency of the United States government. The six men, who met on Jekyll Island, Georgia in 1910 as representatives of one fourth of the world’s wealth, conceived the idea and the blueprint for the Federal Reserve System:
- Henry P. Davison, senior partner of J.P. Morgan Company
- Benjamin Strong, head of J.P. Morgan’s Bankers Trust Company
- Abraham Piatt Andrew, Assistant Secretary of the U.S. Treasury
- Nelson W. Aldrich, Republican whip in the Senate, Chairman of the National Monetary Commission, business associate of J.P. Morgan, father-in-law to John D. Rockefeller Jr.
- Frank A. Vanderlip, president of the National City Bank of New York, representing William Rockefeller and the international investment bank of Kuhn, Loeb & Co.
- Paul M. Warburg, partner in Kuhn, Loeb & Co., representative of the Rothschild banking dynasty in England and France, brother to Max Warburg, head of the Warburg banking in Germany and the Netherlands (G. Edward Griffin, The Creature from Jekyll Island, p. 5)
Nationalization of banks or other companies can happen with or without compensation to the owners. For example, in 1945, the French government seized Renault, a car maker, because the owners had collaborated with the Nazi occupiers. GM was “saved from bankruptcy” by our government with minimal compensation to the bondholders and stockholders who had prior-claim and should have received a more adequate compensation.
Citizens in the former communist countries had their possessions confiscated by the Communist Party elites who took over assets and wealth, declared it patrimony of the state, and proceeded to distribute it amongst the party apparatchiks. If bank vaults contained valuables, and they did, the contents became the property of the state overnight.
U.S. President Franklin D. Roosevelt signed Executive Order 6102 on April 5, 1933, “forbidding the hoarding of gold coin, gold bullion, and gold certificates within the continental United States” by any individual, partnership, association, or corporation. Such had to be turned over to the Federal Reserve in exchange for $20.67 per troy ounce ($371.10 in 2010 dollars). People did lose money because the Treasury raised the price of gold for international transactions to $35 ($587 in 2010 dollars), an immediate loss for all citizens who had to surrender their gold for less under the penalty of a $10,000 fine and/or 5-10 years in jail. The profit that the Treasury made financed the Exchange Stabilization Fund established by the Gold Reserve Act of 1934.
This begs the question, are your valuables safe in a deposit box at your bank? Safe deposit boxes were not searched or seized by force, however, in prosecution cases gold was seized from safe deposit boxes with a search warrant.
Zelik Josefowitz, who was not an American citizen, was prosecuted for tax evasion and his 10,000 troy ounces of gold confiscated. Estimates of gold seizure/forced sale range from 56 tons (1.8 million ounces) to 500 tons based on U.S. Treasury data and Milton Friedman’s book, “The Monetary History of the United States.”
When a bank fails, the U.S. Treasury receives the safe deposit boxes
When a bank fails, the U.S. Treasury receives the safe deposit boxes. Three thousand banks failed during the 1930s. If nobody claimed a box, it remained in the custody of the Treasury. There are 1,605 cartons in the basement of the Treasury with the contents of unclaimed safe deposit boxes. (Wall Street Journal, October 15, 1981)
Venezuelan dictator Cipriano Castro borrowed money at the turn of the 20th century and refused to pay it back. The creditors, Britain, Italy, and Germany demanded repayment. When Cipriano Castro refused, the three countries sent warships to shell Venezuela’s forts and blockaded its ports until Caracas paid its debt.
Is there a possibility that an executive order may affect or confiscate wealth stored in banks if our economy becomes a national crisis and we default on the national debt? That is a very good question which is worth pondering in times when our government has borrowed so much money in the last four years that it will take generations of Americans to repay the debt.
