Chapter 4: The Business of America
 

U.S. business and financial ties to European financiers

 

The Seven Men

John Moody, author of many standard reference works on American finance, stated in McClure's Magazine, Aug., 1911, "The Seven Men":

"Seven men in Wall Street now control a great share of the fundamental industry and resources of the United States. Three of the seven men, J.P. Morgan, James Stillman, and George F. Baker, head of the First National Bank of New York, belong to the so-called Morgan group; four of them, John D. and William Rockefeller, James Stillman, head of the National City Bank, and Jacob H. Schiff of the private banking firm of Kuhn, Loeb Co., to the so-called Standard Oil National City Bank group ... the central machine of capital extends its control over the U.S.... The process is not only economically logical; it is now practically automatic."

What was true in 1911 is even more true in 1984; the seven men are now, as then, merely American agents for London interests. In 1919, Moody wrote in "Masters of Capital":

"All of the great bankers began as dry goods traders, including Junius S. Morgan."

Beebe Morgan was a dry goods house. J.M. Beebe Co. of Boston made Junius S. Morgan a partner. Junius Morgan was later invited to join George Peabody & Co. of London, which handled most of the House of Rothschild's trading in American stocks. Junius Morgan's son, J.P. Morgan, later changed the name of the firm to J.P. Morgan & Co., but it continued to be one of three representatives of the House of Rothschild in the U.S., the others being Kuhn, Loeb & Co. and August Belmont.

The Morgan group and the National City Bank group held a secret meeting at Jekyll Island, Ga. the week of Nov. 22, 1910 to consolidate their financial power. Present were:

Although these men were the most influential financiers in the U.S., they were present at Jekyll Island merely as the emissaries of Baron Alfred Rothschild, who had commissioned them to prepare legislation establishing a central bank in the U.S., modelled on the European fractional reserve central banking organizations of the [German] Reichsbank, the Bank of England, and the Bank of France, all of which were controlled by the House of Rothschild.

To enact the Federal Reserve Act into the law of the land, the bankers elected Woodrow Wilson president of the U.S. in 1912 by splitting the Republican Party, defeating the popular William Howard Taft by financing Theodore Roosevelt's malicious Bull Moose third party candidacy.

Wilson's academic career at Princeton had been financed by gifts from Cleveland H. Dodge, director of Citibank, and Moses Taylor Pyne, grandson and heir of the founder of National City Bank. Wilson then signed an agreement not to go to any other college.

The Federal Reserve Act was legislated through Congress as the Glass-Owen bill, backed by two Democrats, Congressman Carter Glass of Virginia, and Sen. Robert Owen of Oklahoma. Owen was persuaded to back the bill by Samuel Untermyer, who had cultivated him while acting as counsel for the Pujo Money Trust investigation. Untermyer flattered Owen by entertaining him at Greystone, his palatial Hudson River estate. Untermyer claimed to be a "progressive Democrat", although he lived in feudal splendor, employing 167 men to tend his expanse of orchids and greenhouses. At Greystone, Owen dined with Paul Warburg, Bernard Baruch, and other financiers who had been instructed to get the Federal Reserve Act passed. Owen, a former Indian agent who knew little about finance, was easily persuaded by Paul Warburg's doctrinaire pronunciamentos about "our antiquated banking system", which must be brought up to par with the more modern banking system of Europe.

 

The Federal Reserve Bank of New York

After the Federal Reserve Act had been passed by Congress and signed into law by President Woodrow Wilson, six New York banks controlled by the Morgan-Standard Oil group bought controlling interest of the Federal Reserve Bank of New York, which they have held ever since. The May 19, 1914 organization chart of the Federal Reserve Bank of New York shows that of the 203,053 shares issued:

These six banks in 1914 owned 40% of the stock of the Federal Reserve Bank of New York.

[National City and First National] merged into the present Citibank in 1955, giving them one-fourth of the shares in the Federal Reserve Bank of New York. The $134 billion Citicorp is now the largest bank in the U.S.

The Federal Reserve System printout of shareholders July 26, 1983 showed that they now own 53%, as follows:

House Report 159362, p.183, notes:

"Next to Baker and Son, Morgan & Co. is the largest stockholder of First National (of New York), owning 14,500 shares; Baker and Morgan together own 40,000 of the 100,000 shares of First National Bank."

The New York Times, Sept. 3, 1914, at the time of the Federal Reserve stock was being sold, showed the principal stockholders of these banks as follows:

During a period when thousands of U.S. banks have gone bankrupt since 1914, these banks, protected by their interest in the Federal Reserve Bank of New York, have grown steadily. A Senate Report, "Interlocking Directorates among the Major U.S. Corporations, a staff study of the Senate Committee on Governmental Affairs," June 15, 1978, shows that five of these aforementioned banks held a total of 470 interlocking directorates in the 130 major corporations of the U.S., an average of 3.6 directors per major U.S. Corporation. This massive report is worthy of anyone's detailed study; we can only give the totals here:

This centralized control over American industry by five New York banks controlled from London suggests that instead of 130 major U.S. corporations, we may have only one, which in itself is an outpost of the London Connection.

 

National City Bank of New York (Citibank)

In the early 19th century, the House of Rothschild established a number of affiliates in the U.S. which carried the code identification of 'City' banks, or 'City' companies, identifying them as originating in the financial centre, the City of London. The City Bank was established in New York in 1812, in the same room in which the Bank of the United States had operated until its charter expired.

Later called the National City Bank [1865], its principal for fifty years was Moses Taylor, whose father had been a confidential agent for John Jacob Astor and British intelligence. Like the Morgan-Peabody operation, Moses Taylor doubled his fortune in the Panic of 1837 by purchasing stock in the depressed market with capital advanced by N.M. Rothschild of London. During the Panic of 1857, while many of its competitors failed, City Bank prospered. Moses Taylor purchased the outstanding stock of Delaware Lackawanna Railroad for $5 a share during the panic. Seven years later, it was worth $240 a share. He was now worth $50 million.

His son-in-law, Percy Pyne, had come from London to work at City Bank, and married Taylor's daughter. When Taylor died in 1882, he left $70 million. His son-in-law, now paralyzed, became president of the now National City Bank. John D. Rockefeller's brother William [Rockefeller] invested in the bank, and persuaded Pyne to step aside in 1891 in favor of James Stillman, Rockefeller's associate, to become president. William's son, William [Jr.], married Stillman's daughter Elsie; his other son Percy married Stillman's daughter Isabelle. James Stillman also had a London connection -- his father, Don Carlos [Charles] Stillman, had been a Rothschild agent in Brownsville, Texas and a successful blockade runner during the Civil War.

The National City Bank acquired several subsidiaries in New York: the National City Co., later renamed the City Co., and City Bank Farmers Trust Co.

The dominance of the Morgan-Kuhn Loeb financial power in New York is shown by a Dow Jones report in the New York Times Feb. 11, 1928 that of [the] total offerings of bonds in 1927, J.P. Morgan was first with $502,590,000; National City Co. was second with $435,616,000; Kuhn Loeb was third with $423,988,000.

On July 3,1929, the New York Times noted that Charles A. Peabody had joined the boards of National City Co. and City Bank Farmers Trust.

On Aug. 4, 1932, the New York Times stated that National City Bank would issue its own currency against U.S. bonds carrying the circulatory power under the new Federal Home Loan Bank Act which empowered National City Bank to issue up to $124 million in currency. The National City Bank had now become a "bank of issue", a function formerly reserved to central banks.

On June 8, 1933, James H. Perkins, chairman of National City Bank, announced the National City Co., would change its name to City Co. of New York. On Nov. 21, 1933, the National City Bank listed 31 affiliates including City Bank Farmers Trust, City Co. of New York, City Co. of Massachusetts, 44 Wall St. Co. and Cuban Sugar Plantations Inc.

On March 3, 1934, the New York Times announced that National City Bank would sell the National Bank of Haiti, a wholly owned subsidiary on April 29, 1934. The Times also noted that National City Bank had organized United Aircraft Feb. 2, 1934, and that its subsidiary, City Bank Farmers Trust had celebrated its 112th anniversary on Feb. 28, 1929.

On June 27, 1934, the City Co. of New York was designated German bond scrip agent in the U.S. On May 22, 1933, City Co. of N.Y. announced its merger with Brown Bros. Harriman, with Joseph Ripley as chairman of the board. The company went through several name changes as Brown Harriman Co., Harriman Ripley, and is now Brown Bros. Harriman once more.

On March 4, 1934, Gen. Billy Mitchell, addressing the Foreign Policy Association, stated that National City Bank and its affiliates control aviation in this country. Allen W. Dulles, introduced as a "specialist in international affairs" announced the profits of international munitions makers were unconscionable.

On March 2, 1955, National City Bank announced it would purchase the stock of First National Bank for $165 million, at $550 a share (in the 1929 boom, First National sold for $8600 share). Some market analysts believed the stock should have brought $750 a share in the 1955 sale, suggesting that the Baker family was no longer able to protect its interests. The resulting Citibank became the largest bank in the U.S., with a controlling interest in the Federal Reserve Bank of New York. National City Bank had been in Hong Kong for eighty years; it has a $90 million Citibank Centre there. In 1983, 4% of its annual profits came from the Hong Kong operation, which is the center of the world's drug trade.

 

National City Bank of Cleveland

Besides its controlling interest in the Federal Reserve Bank of New York, the Rothschilds had developed important financial interests in other parts of the United States. The House Banking and Currency Committee Report May, 1976, "International Banking", p. 60, identified the Rothschild Five Arrows Group and its present five branches:

These five were combined in a single bank, Rothschild Intercontinental Bank Ltd. The House Staff Report discloses that Rothschild Intercontinental Bank Ltd. has three principal American subsidiaries:

These Rothschild subsidiaries were ranked in 1983 as follows: First City Bancorp Houston, 23rd in size in U.S., $17 billion assets; National City Corp. of Cleveland, 48th largest in U.S., $6.5 billion assets. National City Corporation of Cleveland has exercised a dominant role in Midwestern industry and politics for many years; First City Bancorp dominates Texas oil and heavy industry as well as Texas politics.

In 1900, Cleveland was the home of Marcus Alonzo Hanna (known as Mark), the legendary political boss of the Republican Party. He twice nominated and elected an Ohio Congressman, William McKinley, to the Presidency of the U.S. He initiated the checkoff system by which banks and corporations were required to make regular political contributions. Hanna founded two companies, M.A. Hanna Co. and Hanna Mining Co., which acquired large steel and iron holdings.

In 1953, President Eisenhower named George Humphrey Secretary of the Treasury. Humphrey, president of M.A. Hanna Co., was also chairman of National Steel Co. (recently acquired by Nippon Kokan, a Japanese concern); director of Sun Life Assurance Co. (Rothschild), Industrial Rayon Corp., the world's largest manufacturer of auto tire cord (L.L. Strauss of Kuhn, Loeb Co. controlled the firm; Harry Byrd Jr. was also a director).

Humphrey was also a director of the National City Bank of Cleveland. Other directors of this bank were:

National City Bank of Cleveland now has $6.5 billion assets, 8,171 employees, and seventeen companies. It recently purchased the $500 million revenues bank, BANCOHIO.

In 1978, George Humphrey's son, Gilbert W. [Humphrey], was chairman of Hanna Mining Co., director National City Bank of Cleveland, Sun Life Assurance, National Steel, Massey Ferguson, General Reinsurance, and St. John del Rey Mining Co. M.A. Hanna Co., the holding company, was liquidated in 1965, and its $700 million assets distributed to its stockholders.

The National City Bank of Cleveland's influence was not limited to the Hanna and Humphrey families. As the Ohio Connection of the House of Rothschild, it guided the careers of two of the nation's best known families, the Tafts and the Rockefellers. The bank financed the Taft family's activities in politics and business, the Taft Broadcasting Co. and other firms. John D. Rockefeller's success began when he obtained the backing of the National City Bank of Cleveland to finance his takeover of his competitors in the oil business.

Because J.P. Morgan and Kuhn, Loeb Co. controlled 95% of all railway mileage in the U.S. in the latter half of the 19th century, they offered Rockefeller special rebates on shipping oil through his holding company, South Improvement Co. This enabled him to undersell and ruin his competitors. One of them was a Mr. Tarbell, whose daughter, Ida Tarbell, later wrote the first expose of Standard Oil and was termed a "muckraker" by Theodore Roosevelt, a term which promptly went into the language. The entire Rockefeller empire was financed by the Rothschilds.

When Lincoln Steffens became a Wall Street reporter, he interviewed both J.P. Morgan and John D. Rockefeller on several occasions. He soon realized that these gentlemen, powerful though they were, were mere front men. He noted that:

"No one ever seems to ask the question 'who is behind the Morgans and the Rockefellers ?'"

No one else ever asked the question, nor did anyone answer it! Steffens knew the money for their operations was coming from someone else, but never managed to trace it.

In February 1930, one of the few articles on the Rothschilds ever to appear in an American magazine appeared in Fortune, which stated:

"On only one important point did the Rothschilds guess wrong. They never would have anything to do with the U.S. of America. Imagination falters at what the Rothschilds might be today if they had spent on the infant industries of this country one-half the sums they poured into Imperial Austria."

The Fortune writer did not know then and probably never knew that the Rothschilds have always controlled the Morgan and Rockefeller operations, as well as the foundations set up by these front men to control the people of the United States.

During the past quarter of a century, many writers have published alarming exposes of the Rockefellers and their control of the U.S. through the Council on Foreign Relations. In 1950, the New York Times carried a small notice on an inside page that L.L. Strauss, a partner of Kuhn, Loeb Co., had been appointed financial advisor to the Rockefeller brothers. In short, all their investments must be approved by a partner of Kuhn, Loeb Co. It has always been thus, beginning with Jacob Schiff.

Strauss held the position from 1950 to 1953, when it passed to J. Richardson Dilworth. Dilworth, who married Elizabeth Cushing, was a partner of Kuhn, Loeb Co. from 1946 to 1958, when he became director of finances for the entire Rockefeller family, presiding over all their accounts on the 56th floor of Rockefeller Center. He held the position until 1981. He is now Chairman of the Board of Rockefeller Center, director of International Basic Economy Corp., Chrysler, R.H. Macy, Colonial Williamsburg and Rockefeller University.

The National City Bank of Cleveland continues to dominate Midwestern industry and politics. For many years, its primary law firm has been Jones, Day, Reavis and Pogue of Cleveland. The Washington Post announced Dec. 19, 1983 that this law firm was spending $5 million for office space in Washington to house a staff of sixty lawyers, making this Cleveland law firm one of the most potent lobbying groups in Washington.

Hanna Mining Co., despite relatively modest revenues of $333 million, exercises an important role as shown by its board of directors, including such distinguished names as:

 

First City National Bank of Houston

Despite the Hollywood image of redfaced Texas oil millionaires driving new Cadillacs, the Texan oil industry has for years been dominated by the London Rothschilds through the billion dollar First City National Bank of Houston, and its fifty-seven subsidiary Texas banks. Chairman of First City is James Anderson Elkins Jr., who is a director of Hill Samuel Co. of London, one of the seventeen merchant banks chartered by the Bank of England.

His father [J.A. Elkins Sr.] was chairman of First City, and founded the Texas law firm of Vinson and Elkins, the primary law firm of First City Bank. This firm dominated national politics through its most well known partner, John B. Connally, who achieved a reputation as "kingmaker" in Texas politics. He began as administrative assistant to Congressman Lyndon B. Johnson in 1949, then became attorney for the oil millionaire Sid Richardson, and Perry Bass, 1952-61, Secretary of the Navy 1961, Governor of Texas 1963-69; Secretary of the Treasury 1971-72. He was wounded in the Kennedy assassination in Dallas. He is now trustee of the Andrew Mellon Foundation, serves on the President's Foreign Intelligence Advisory Board, and the Advisory Committee on Reforming the International Monetary System. He advised Nixon on devaluing the dollar and going off the gold standard in 1971. He is now director of Superior Oil, and Falconbridge Nickel Mines Ltd.

James Anderson Elkins is also director of Freeport Minerals, whose directors include some of the leading names in American business. Chmn of Freeport is Benno H. Schmidt, managing director of J.H. Whitney Co.. Schmidt, who married into the wealthy Fleischmann family (New Yorker magazine etc.), graduated from Harvard Law in 1941, became general counsellor of the War Production Board in Washington 1941-42, and headed the Foreign Liquidation Commission 1945-46, which disposed of billions of dollars worth of property. He is also director of CBS, and Schlumberger, the huge oil field service firm who began business in 1928 when it was awarded its first contract by the Soviet Union -- it is said to have important Anglo-Swiss intelligence connections.

Other directors of Freeport Minerals are:

Other directors of First City Bancorporation include:

[Brown] founded the huge contracting firm, Brown & Root, which financed Lyndon B. Johnson's political campaigns, subsequently receiving billion dollar contracts to construct naval bases and airfields in Vietnam, which are now being used by the Soviet Navy and Air Force. Brown married into the Pratt family, founded Texas Eastern (an oil firm), and is director of ITT, TWA, and the Brown Foundation.

The Brown-Johnson association began in 1940, when Johnson secured a lucrative contract for Brown & Root to build a large naval base at Corpus Christi, Texas; it was said then that any course chosen by Johnson would be paved by money from Brown & Root. J. Evetts Haley pointed out that Brown & Root prospered on government contracts after Johnson helped them and rapidly became a worldwide operation.

In 1940, the Internal Revenue Service found that large contributions given to Johnson by Brown & Root and its subsidiary, Victoria Gravel Co. -- as much as $100,000 each -- were taken by Brown & Root as tax deductions. Haley states:

"Brown & Root were in control of Texas politics; that L.B. Johnson was in control of IRS; that records had been burned at IRS to get Brown off the hook in 1954. Johnson and Connally then picked up a government plant for a small sum which became a giant wartime contractor, the Sid Richardson Carbon plant at Odessa, Tex., in which Mrs. Lyndon B. Johnson had a one-fourth interest."

In 1955, Johnson suffered a major heart attack on his way to George Brown's palatial Middleburg Va. estate.

As mentioned, Brown is a director of Halliburton, whose primary law firm is also Vinson and Elkins. In 1981, Halliburton had $8.3 billion revenues, 110,398 employees, and daily monitors most U.S. oil wells. In addition to George Brown and Anne Armstrong, directors of Halliburton include Lord Polwarth of Scotland, who is Governor of the Bank of Scotland, director of Canadian Pacific, Sun Life Assurance Ltd. and Brown & Root UK which interlocks with George Wimpey Ltd., the largest construction firm in England, through Brown & Root Wimpey Highland Fabricators.

Lord Polwarth, Henry Hepburn-Scott, is a descendant of James Hepburn, Earl of Bothwell, who was married to Mary, Queen of Scots. The first Baron Polwarth (1641-1724) was Sir Patrick Hume, first Earl of Marchmont, and William of Orange's closest advisor. He accompanied William in 1688 on his voyage to take possession of the throne of England, and became his privy councillor, in which office he advised William to grant the charter of the Bank of England. He became a peer of Scotland 1689, Lord Chancellor of Scotland 1696-1702, and Earl of Marchmont 1697. He passed the Act of Succession on to the House of Hanover, and was reappointed by King George I.

John Pickens Harbin, president of Halliburton, is a director of Citicorp. Another director of Halliburton is William E. Simon, Secretary of the Treasury 1973-77. He is a director of Citicorp, Citibank, and United Technologies. As director of Citibank, he interlocks with Lord Aldington of London (Toby Low), who is also director of Citibank and chairman of Sun Life Assurance, the keystone of the Rothschild fortune. Lord Aldington is chairman of Grindlay's Bank, London, director of General Electric Ltd., Lloyd's Bank, United Power Ltd., and National Discount Corp.

During a national "oil crisis" government officials complained they could not obtain any records from oil companies on production and reserves, yet Halliburton received this information on a daily basis.

As director of United Technologies, William Simon again interlocks with Citibank, the only corporation which has four officers on the board of directors of Citibank -- Harry Gray, chairman of United Technologies; Simon; William I. Spencer, who is president of Citibank; and Darwin Eatna Smith, chairman of Kimberly Clark.

Other directors of United Technologies are:

Other directors of First City Bancorporation are John Diesel, pres. of Tenneco, which interlocks with the George Bush oil firm, Zapata [Offshore] Oil Corp., whose chmn John Mackin is a director of Tenneco; Randall Meyer, pres. Exxon; M.A. Wright, former chmn Exxon 1966-76, now chmn Cameron Iron Works.

Other directors of Halliburton Corp. include:

The Houston-Cleveland axis interlocks with many political figures, including:

The political power of this Rothschild-controlled axis was demonstrated by the ease with which they financed the campaigns of two governors of supposedly conservative Southern states, John D. Rockefeller IV in West Virginia, and Charles Robb, son-in-law of Lyndon B. Johnson, in Virginia, heir to the Connally - Brown & Root - First City Bancorp political clout.

The May 1976 staff rept. of the House Banking and Currency Committee noted another Rothschild affiliate (p.60): "The Rothschild banks are affiliated with Manufacturers Hanover of London (in which they hold 20% interest, a merchant bank, and Manufacturers Hanover Trust of N.Y." Manufacturers Hanover recently bought the giant CIT Financial Corp. for $1.6 billion in October, 1983.

 

J. P. Morgan and George Baker

Despite his reputed wealth, the elder J.P. Morgan did not leave one of the great American fortunes when he died in 1913; it was first estimated at $75 million, then $50, and finally disclosed there were only $19 million of securities in the entire estate, of which $7 million was owed to the art dealer Duveen. J.P. Morgan Jr. (known to a very few intimates as Jack) was embarrassed to find he had to sell off many of his father's art treasures to pay the debts of the estate. Most of the huge sums handled by J.P. Morgan went directly to the Rothschilds. In 1905, the New York Times noted in its obituary of Baron Alphonse de Rothschild that he possessed some $60 million in American securities, although the Rothschilds, according to most financial authorities, had never been active in American finance.

Lincoln Steffens noted:

"Senator Aldrich is a great man to me; not personally, but as leader of the Senate. He, Aldrich, bows to J.P. Morgan. The other day J.P. Morgan came to Washington, and he and I and Aldrich had a conference. And I noticed how he, Morgan, addressed himself to me, not to Aldrich. Morgan talked to me, while I talked to Aldrich, who talked to Morgan."

Morgan's partner, George W. Perkins, worked furiously to obtain Theodore Roosevelt's nomination as McKinley's running mate. During Roosevelt's presidency, his closest advisor was George W. Perkins. Despite Roosevelt's nickname of "trustbuster", he protected Morgan's interests throughout his term of office. His successor, William Howard Taft, was opposed to Morgan, and introduced anti-trust legislation to control two Morgan trusts, International Harvester and U.S. Steel. Perkins then created the Progressive Party in 1912 to split the party and defeat Taft.

J.P. Morgan's apex of power was attained in the Panic of 1907, when he assumed control of Wall Street. Oakleigh Thorne, president of the Trust Co. of America, a victim of the "panic", testified before a Congressional Committee that his bank had been subjected to only moderate withdrawals, that he had not applied for help, and that it was Morgan's 'sore point' statement alone that had caused the run on his bank..... "that Morgan interests took advantage of the unsettled conditions during the autumn of 1907 to precipitate the panic, guiding it shrewdly as it progressed so that it would kill off rival banks and consolidate the preeminence of the banks within the Morgan orbit."

Morgan's financial power came from control of the enormous cash flow of the nation's biggest life insurance companies. He gained control of Mutual Life, New York Life, Metropolitan Life, and with George F. Baker and James Stillman, bought controlling interest in Equitable from Thomas Fortune Ryan, who had acquired it from the Hyde family. Hyde originally set Equitable up while acting as a front for Jacob Schiff and James Speyer.

On June 7, 1933, Nation noted: "J.P. Morgan is generally regarded as the most prominent banker in the world." Paul Y. Anderson mentioned in this article that testimony before the Senate Banking Committee showed that Morgan and his partners, including Thomas W. Lamont and E.T. Stotesbury, paid no federal income tax in 1931-32; the partners paid a total of $48,000 in 1930. Anderson remarked:

"Is there any mystery as to why the Marines were despatched against Haiti, San Domingo, and Nicaragua when those countries defaulted, or threatened to default, on the debt payments to American banks ? It has been shown that the Morgan firm had a certain selected list of 'clients' to whom it sold stock at figures substantially under market prices. In the case of the Allegheny Corp. these fair-haired boys got the stock at 20, when the market was 35."

Anderson pointed out that these fortunate few could have sold the stock immediately for almost double what they had paid. Among the recipients of these Morgan favors he listed Senator McAdoo, Justice Owen Roberts, Secretary Woodin, Owen D. Young, and John J. Raskob.

In Nation, June 21, 1933, Anderson continued:

"When Ft. Sumter was fired on, gold began to leave the country. The man [Morgan] who later said 'Don't sell America short' then took a flyer on the short side of America. He borrowed 2 million in gold coins and shipped it to London. This was really a blow behind the lines. Then he went to the 'gold room' to watch the effect. There was a scramble for gold to pay commitments abroad and this patriotic American with 2 million in eagles in London sold at his own price."

In March, 1929, perhaps in preparation for the coming storm [October crash --ed], two Morgan banks merged, the National Bank of Commerce, which, according to the New York Times had "important foreign connections", and Guaranty Trust, forming a $2 billion institution. On Feb. 26, 1929, the New York Times noted, "The Guaranty Trust has long been known as one of the 'Morgan group'. The National Bank of Commerce has also been identified with Morgan interests."

J.P. Morgan's longtime associate, George Fisher Baker, was one of the founders of First National Bank, purchasing 30 shares in 1863 for $3000. He also was cashier, and later became president. Sheridan A. Logan's book, "George F. Baker and his Bank" (privately printed, 1981), noted that:

"...a European syndicate headed by N.M. Rothschild was represented in New York by August Belmont and First National Bank to refund the Government debt. Baker wrote a letter Aug. 29, 1876, 'I have to advise you that our negotiations with the Treasury Dept. resulted in a contract between Messrs. N.M. Rothschild & Sons and others and the Secretary of the Treasury for the purpose of forty million dollars of U.S. 4 1/2 per cents of 1891, with an option on the remainder, $260 million. In this contract the bank participated to the extent of 10%, $4 million.'"

Logan also states that:

"In 1901 Baker sold to J.P. Morgan $23 million stock in Central Railroad of New Jersey. The mutual confidence and respect which developed between Mr. Baker and Mr. Morgan cemented their increasingly close relationship and the First National Bank became more and more the unswerving ally and valuable source of mobile funds for the work of J.P. Morgan & Co."

In 1901, Baker increased the stock of First National Bank from $500,000 to $10 million by a 1900% stock dividend. He organized First Security Co., a holding company, with this dividend. During the 1929 boom, Baker's personal fortune reached the $500 million mark. His son, George Jr. pleaded with him to pay off the $29 million owed on stocks in First Security's $80 million portfolio. Baker, then 89 years old, had not been informed of the planned credit contraction, possibly because the insiders feared he might gossip about it. He continued to refuse to sell any stocks -- the crash of 1929 reduced his fortune to $200 million.

When he died in 1931, the estate was appraised at $73 million; his son, George Jr. inherited $30 million. His health had been shattered by the strain of working with his father during the desparate days of 1929, and he died of a heart attack in Honolulu, aged 59. His son, George F. III was found shot at Horseshoe Plantation, Fla. in 1977. George III's son, Grenville, was found shot at Tallahassee, Fla. in 1949, at age 33. George Jr.'s daughter, Edith Brevoort Baker, married Jacob Schiff's grandson, John Mortimer Schiff, in 1939, uniting two of America's largest fortunes. George Baker I's daughter Florence had married Howard Bligh St. George in 1891, member of one of England's oldest families. Their granddaugher Priscilla married Angier Biddle Duke in 1937, and second, Allen A. Ryan Jr. in 1941, a relative of the Delanos.

In 1935, Gen. Smedley D. Butler wrote in the Nov. issue of Common Sense of his Marine career:

"I helped make Mexico and especially Tampico safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in.... I helped purify Nicaragua for the international banking house of Brown Bros. in 1909-12. In China in 1927 I helped see to it that Standard Oil went its way unmolested. In 1899 J.P. Morgan floated the first important foreign loan on behalf of the Mexican Government. In 1901 he lent $50 million to the British Government to fight the Boer War. But it was mainly into the countries of Spanish America that American capital found its way."

Butler continued his revelations in the Dec. 1935 issue:

"In 1910, six months after the Nicaraguan Revolution which ousted President Zelaya, his successor, Dr. Madris, grew cold towards the Nicaraguan investments of Brown Bros. and Seligman Co. Another revolution immediately 'occurred'."

Butler mentions the Latin American activities of Brown Bros., now Brown Bros. Harriman, a firm little known to most Americans. In 1801, a linen auctioneer from Belfast, Alexander Brown, established a banking house, Alexander Brown & Co. in the slavetrading port of Baltimore. It is now the oldest banking house in the U.S. Its English branch, Brown Shipley, also became influential, its most well known member being Lord Montague Norman, Governor of the Bank of England for many years, 1907-44, longer than any other man in history. Current Biography 1940, noted, "There is an informal understanding that a director of Brown Shipley should be on the board of the Bank of England and Norman was elected to it in 1907."

[Also see "War Is a Racket" by Gen. Butler --ed]

 

Brown Brothers Harriman

In expanding Rothschild investments in U.S. railroads, Kuhn, Loeb Co. found a useful agent in E.H. Harriman. A young man on the make, Harriman married the daughter of the president of a small New York railroad, and soon looked for more worlds to conquer. George Redmond writes in "Financial Giants of America":

"He (Harriman) early won the confidence of Kuhn, Loeb Co. and established relations which later became most advantageous to both."

Kuhn, Loeb financed the Union Pacific takeover by Harriman. H.J. Eckenrode notes in "E.H. Harriman":

"In his takeover of UP, Harriman had behind him tremendous financial force -- not only Kuhn, Loeb Co. with funds from Frankfurt and Berlin, but the National City Bank, 'the greatest source of cash in the country'."

Harriman employed judge Robert Scott Lovett as general counsel for Union Pacific. When Harriman and Otto Kahn were summoned by the ICC in 1897, Lovett advised them to refuse to answer all questions about their stock operations. In 1908, the Supreme Court upheld their refusal to talk. The records of this case, SC No. 133 US v. UP RR, later disappeared from the Library of Congress. In 1911, the Equitable Life Insurance building, which contained all the records of the Union Pacific RR, burned, destroying all UP papers to that date.

Lovett's son, Robert Abercrombie Lovett married Adele Brown, daughter of a partner of Brown Bros. and became a partner in 1926. He was Special Asst. Sec. of War 1940-45, Under Secretary of State, 1947-49, Dep. Secretary of Defense 1950-51, Secretary of Defense 1951-53. It was Lovett who took the then Secretary of Defense James Forrestal, of Dillon Read Co. to Fishers Island to persuade him to change his stand against U.S. Middle Eastern policies. Forrestal refused, and was placed in a mental ward at the National Institute of Health, where he 'fell' out of the window. Lovett then replaced him as Secretary of Defense.

Brown Bros. backed the B & O steamship line in 1887, and went into joint venture with J & W Seligman Co. on a number of South American loans. In 1915, Brown Bros. combined with J.P. Morgan to float a series of Latin American loans, which in many instances were followed by revolutions in the respective countries. In the Nation, June 7, 1922, Oswald Garrison Villard noted: "The Republic of Brown Bros with J & W Seligman had reduced Haiti, Santo Domingo, and Nicaragua to the status of colonies with ruinous loans. Most of the loans were repaid in 1924."

In 1931, W. Averell Harriman, son of E.H. Harriman, merged his banking house, W.A. Harriman & Co. with Brown Bros. to form the present firm of Brown Bros. Harriman. In 1933, Brown Bros. Harriman backed the expansion of CBS [Columbia Broadcasting System], in which they have maintained a large position. The Brown Bros. firm occupied offices on the corner of Wall Street and Hanover which had been occupied by J.L. & J.S. Joseph Co., the [former] American representatives of the Rothschilds. Josephs went broke in the Panic of 1837, having been cut loose by the Rothschilds, who were now operating through August Belmont and George Peabody & Co..

W. Averell Harriman brought to the new firm his vice president, Prescott Sheldon Bush, who had been with him since 1926. Bush became chairman of the Board of Pennsylvania Water & Power Co., director U.S. Rubber, PanAm, CBS, Dresser Mfg Co., Vanadium, U.S. Guaranty, Prudential Insurance and partner Brown Bros Harriman. He was chmn National War Fund 1943-44 and chmn USO. His son George [H.W.] Bush is now vice president of the U.S.

George Herbert Walker, grandfather of George H.W. Bush, who was named after him, became president of W.A. Harriman Co. in 1928 (now Brown Bros. Harriman). He was director of Belgian-American Coke Ovens Corp., chmn Habershaw Cable Corp., chmn International Great Northern Railway, director Certain Teed Products, American Shipping & Commerce Corp., American International Corporation, Cuba Railway Co., Pennsylvania Coal & Coke. He was the donor of the Walker Cup, the prestigious golf trophy, and president of the U.S. Golf Association. In 1925, he financed the building of Madison Square Garden. His son, George H. Walker Jr. became chmn Walker-Bush Oil Corp., and Zapata Petroleum (George Bush's firm), Silesian Holdings, with W.A. Harriman City Investing Corp., Westmoreland Coal. Co. and West Indies Sugar Co. He is a trustee of Yale. George H. Walker III merged the firm of G.H. Walker Co. with Laird & Co. and White & Weld in 1974. He is now a senior vice pres. of White & Weld.

Harriman was the go-between of Churchill and Roosevelt's World War II alliance. The two leaders did not know or particularly like each other; each of them conferred with W. Averell Harriman about how to talk to the other, and carefully followed his advice.

W.A. Harriman served as U.S. Ambassador at large during World War II, principally in Moscow with Stalin; his brother E. Roland was president of the American Red Cross; [partner] Robert A. Lovett was Secretary of Defense. Harriman was related by marriage to Wild Bill Donovan, founder of the OSS.

Brown Bros has always maintained close relations with British firms. James Brown, partner from 1935-50 was director Northern Assurance of London, Sun Insurance, pres. British Empire Club and National Bank of Nicaragua. Thatcher M. Brown, another partner, was director of Manchester Land Co., National Bank of Nicaragua, chairman of the board of Liverpool and London Insurance Co. Ltd., Globe Indemnity Co., Royal Insurance, British and Foreign Marine Insurance Ltd., American London & Empire Co., Ocean Accident & Guaranty of London, and Thames & Mersey Marine Insurance Co.

The New York Times noted May 29, 1928:

"Dr. Rudolf Roesler, representative of the New York banking house of Brown Bros. said Germany for a number of years to come would be a borrowing nation. Brown Bros. had loaned the City of Berlin $15 million on 6% 30 yr. bonds and Mr. Roesler, who completed details of the transaction said that 'it was the biggest loan to a city in Europe since 1914'."

The New York Times later noted:

"Word was received here yesterday by J. Henry Schroder Banking Corp., representative in the U.S. for Capt. Alfred Lowenstein, that a corporation organized by the Belgian capitalist and French associates, whom it has offered the public in Paris, had been oversubscribed twenty-five times."

The holding company for artificial silk shares was offered at $117.50 and promptly went to $200. This good news was somewhat palled by the Times report that a syndicate had been formed to handle this stock since:

"Capt. Alfred Lowenstein whose reported death through a fall from an airplane in the English Channel July 4th has been surrounded by mystery. J. Henry Schroder is to purchase $25 million of bonds of International Holding and Investment Corp. through Albert Pam, of J. Henry Schroder London, and Albert Svarvasy, head of British Foreign and Colonial Corp., British investing company."

The July 5, 1928 New York Times headlined: "CAPT. LOWENSTEIN FALLS FROM PLANE. Known as Mystery Man." Alfred Lowenstein was known as a Croesus.

"The 'mystery man of Europe', the successor to Sir Basil Zaharoff as a man of mystery, in European finance. The pilot informed the authorities that while the plane was crossing the sea, Capt. Lowenstein, wishing to go to the washroom, opened the wrong door and fell out. His valet and two stenographers as well as the pilot and mechanic of the plane were present, but did not notice what happened."

The story added that Lowenstein owned eight villas in Biarritz, an estate in Lancashire, a castle in Brussels, and a townhouse in London.

Informed observers believed it was Zaharoff himself who dethroned the pretender to his title as "mystery man of Europe". Lowenstein had become involved in a desperate struggle with Zaharoff and his associate, Dreyfus Clavell, to control the artificial silk industry in Europe. After Lowenstein's accident, his two associates in this struggle also died mysteriously. M.M. Ayrich had an automobile accident on a deserted road, with no witnesses. Lowenstein's third associate, Prince Radziwill, was poisoned by a woman friend, according to a French journal, La Crapoulle.

W. Averill Harriman was 78 when his wife died. A year later, Katharine Meyer Graham, publisher of the Washington Post, invited him to a party to meet Pam Churchill, daughter of Lord Digby, an English horse fancier. She had been married to Randolph Churchill, and was mother of the present Winston Churchill. She then married into the first family of Hollywood, producer Leland Hayward, formerly married to actress Margaret Sullavan. In Haywire, her autobiography, Brooke Hayward describes her stepmother as "a cold-blooded golddigger who made off with her mother's jewels". Pam dated Elie de Rothschild before deciding to marry Harriman. They are now the dominant figures in the Democratic Party. Harriman has given $15 million to the Russian Institute at Columbia, (now the Harriman Institute).

 

Dillon Read

Another prominent banking house is the firm of Dillon Read. Clarence Dillon (1882-1979) was born in San Antonio, Texas, son of Samuel and Bertha Lapowski or Lapowitz. He graduated from Harvard in 1905, married Anne Douglass of Milwaukee, whose father owned Milwaukee Machine & Tool Co. They went abroad from 1908 to 1910. Their son, C. Douglas Dillon, was born in Switzerland in 1909. In 1912, Dillon met William A. Read, founder of a well known Wall Street bond brokerage, through a Harvard classmate. They became partners. Read died suddenly in 1916, and Dillon bought control of the firm.

During World War I, Dillon served as Bernard Baruch's righthand man at the War Industries Board. In 1915, Dillon had set up American & Foreign Securities Corp. to finance the French Government's purchases of munitions in the U.S. His righthand man at Dillon Read was James A. Forrestal, who later died [under mysterious circumstances --ed] while serving as Secretary of Defense. Dillon Read played a crucial role in rearming Hitler during the preparation for World War II.

In 1957, Fortune Magazine listed Clarence Dillon as one of the richest men in the U.S. ($150-200 million). By normal growth rates, his son C. Douglas Dillon should be worth over $1 billion, but nobody knows. C. Douglas Dillon worked with John Foster Dulles on the Dewey campaigns, and served as Under Secretary of State, helping Bechtel Corp. obtain its first large Saudi Arabian contracts, which later became a $135 billion operation. Dillon was Ambassador to France 1953-57, later became Secretary of the Treasury. He was chairman of the Rockefeller Foundation from 1971-75, then chairman of the Brookings Institution. To organize his estate, he sold Dillon Read to the Bechtel Corp. He is considered to be one of the ten wealthiest men in the U.S. and one of the three most powerful.

 

The Warburgs and Kuhn, Loeb Co.

Second to the Rothschilds, the Warburgs were considered the most important international banking family of the 19th and 20th centuries. In 1798, two sons of Marcus Gumprich Warburg, Moses Marcus [Warburg] and Gerson W. [Warburg] founded M.M. Warburg Co. in Hamburg.

They were descendants of Simon von Cassel, a 16th century moneylender and pawnbroker. They were also direct descendants of Abraham del Banco, largest banker in Venice. When they moved north, they took the name of Warburg, after Cassel settled in this Westphalian town. In 1814, the Warburgs became one of the first affiliates of N.M. Rothschild of London. They were related to the leading banking families of Europe, the Rosenbergs of Kiev, the Gunzburgs in St. Petersburg, the Oppenheims and Goldschmidts in Germany. Moritz Warburg was apprenticed to the Rothschilds in Italy and Paris, and later married Charlotte Oppenheim, whose family were diamond merchants in Frankfort.

They had five sons, known as "the Five Hamburgers": the oldest, Aby, founded the Warburg Institute; Max financed the German struggle in World War I and later, the Nazi regime; Dr. Fritz Warburg was German commercial attache in Stockholm during World War I; Paul and Felix emigrated to America and joined the firm of Kuhn, Loeb & Co. with Jacob Schiff, who had been born in the Rothschild house in Frankfort. Paul wrote the Federal Reserve Act and saw it through Congress. He represented the U.S. at the Versailles Peace Conference, while his brother Max represented German interests.

The Memoirs of Max Warburg state, "The Kaiser thumped the table violently and shouted 'Must you always be right?', but then listened carefully to Max's view of financial matters."

M.M. Warburg Co. closed during World War II but reopened in 1970. George Sokolsky noted in "We Jews": "Even in Hitler Germany the firm of Max Warburg was exempted from persecution. Max left for the U.S. in 1939, unhampered by supposed restrictions on Jews."

The U.S. Naval Secret Service Report Dec. 2, 1918 noted:

"PAUL WARBURG. German, nationalized U.S. citizen 1911, decorated bv Kaiser, handled large sums furnished by German bankers for Lenin & Trotsky. Has brother Max who is director of espionage system of Germany."

In partnership with Walter Teagle of Standard Oil, Paul Warburg organized the international dye trust, I.G. Farben and Agfa Ansco Film Trust. At the second annual convention of the American Acceptance Council, Dec. 2, 1920, President Paul Warburg said:

"It is a great satisfaction to report that during the year under review it was possible for the American Acceptance Council to further develop and strengthen its relations with the Federal Reserve Svstem."

He did not add that as vice chairman of the Federal Reserve Board from 1914-18, he had organized the Federal Reserve System, or that he served as president of the Federal Advisory Council from 1918-27, which actually formulated policy for the Board. He was director of Union Pacific RR, B&O RR, National Railways of Mexico, Western Union, Wells Fargo, American IG Chemical, Agfa Ansco, Westinghouse, Warburg Banks in Amsterdam, London and Hamburg, and chairman of the board of International Acceptance Bank.

His brother Felix was chief financial banker of the Zionist Organization of America, Palestine Economic Corp., National Railways of Mexico, Prussian Life Insurance of Berlin, and many other companies. Felix's son Edward M.M. Warburg succeeded Gen. [Bill] Donovan as Coordinator of Information in 1941 and later served as special political advisor to Gen. Eisenhower at SHAEF, London during World War II. His other son Frederick was Herbert Lehman's righthand man in organizing the Lehman Corp., and was later known as "the foreign minister of Kuhn, Loeb" because of his many contacts around the world. He retired as a country gentleman at his estate Snake Hill, Middleburg, Va. His partner, Lewis L. Strauss had a magnificent estate nearby at Brandy Station, site of the Civil War engagement which was the largest calvary battle in U.S. history.

Dept. of Commerce figures show that Kuhn, Loeb controlled 64% of all railroad mileage in the U.S. in 1900, which dropped to a mere 41% by 1939. In 1900, Kuhn, Loeb and J.P. Morgan, representing the Rothschilds, controlled 93% of all railway mileage in the U.S.; Speyer & Co. controlled N.Y. real estate and South American minerals; Seligman & Co. sugar, public utilities, and Latin American loans; August Belmont, the New York subway system; Lazard Freres, gold and silver, specializing in international gold movements.

Other Power Brokers

U.S. News May 14, 1984 listed "Who Runs America"; the first ten included Weinberger and Shultz of Bechtel Corp.; the second ten included Sulzberger of the New York Times, vice pres. [George] Bush, David Rockefeller; the third ten included Katharine Graham and Henry Kissinger. Former president Gerald Ford was not listed; he is now director of GK Technologies, a $1.19 billion firm with large defense contracts.

Other leading defense firms are United Technologies; Scovill Corp. whose chairman Malcolm Baldrige is now Secretary of Commerce; directors include Daniel Pomeroy Davison of J.P. Morgan bank and president U.S. Trust Olin Corp., $1.85 billion; and General Dynamics, controlled by the Crown family of Chicago.

When Texaco swallowed the $12 billion Getty Oil corp. after its founder died, it showed the financial power of the London Connection. Directors of Texaco included Willard C. Butcher, former chmn of Chase Manhattan; Earl of Granard (Forbes) (the first baronet had reduced Sligo for William III), and grandson of Ogden Mills, Secretary of Treasury U.S. 1932-33; Thomas H. Moorer, chmn joint Chfs of Staff 1970-74, director Fairchild Bunker Ramo; Robert V. Roosa, director Brookings Institution, Trilateral Commission.

The Rothschild Houston-Cleveland axis brought off one of its greatest coups when its agent John Connally, then Secretary of the Treasury, persuaded Nixon to abandon the gold standard. The New York Times headlined, Aug. 16, 1971:

SEVERS LINK BETWEEN DOLLAR AND GOLD

President Nixon announced tonight that henceforth the U.S. would cease to convert foreign held dollars into gold -- unilaterally changing the 25 year old international monetary system. The President said he was taking the action to stop 'the attacks of foreign monetary speculators against the dollar'. The change in the world monetary system brought about by the Presidential decision to cease converting foreign held dollars into gold is entirely uncertain. That was the word used by Secretary Treasury John B. Connally. Mr. Connally said he did not know what would happen."

The Times noted that "Advice to impose some controls has been given the President from such sources as David Rockefeller, chmn of the $23 billion Chase Manhattan Corp., and the Organization for Economic Development, a group representing 22 nations." The Times editorially stated, "We unhesitatingly applaud the boldness with which the President has moved on all economic fronts -- an admiration for the completeness with which the President has junked the do-nothing approach that immobilised the country and sapped the national will."

On 17 Aug. 1971, the Times quoted Paul Volcker, Under Secretary of the Treasury, who, when asked if other currencies would rise in relation to the dollar, replied, "I think we are in no position to object." With the story was a photo of Volcker conferring with banking officials in London, with the caption:

"Under Secretary Paul A. Volcker conferred with leading European financial officials here today on President Nixon's new policy to meet the dollar crisis. He hinted broadly that the U.S. would be happy if other countries let their currencies float in the exchange markets. Their value would presumably rise in relation to the dollar. Mr. Volcker said he had found a 'very good understanding' in his meeting. But at the end of a confusing day in European ministries and banks, few thought they could see a clear way out of the immediate monetary chaos caused by Mr. Nixon's moves."

Advance knowledge of such a far-reaching change in the monetary system would be worth billions of dollars.

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