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Rothbard provides a succinct account of the origins of money, showing how money must originate from a commodity. Banking originated from goldsmiths, who issued warehouse receipts for gold deposited with them. From this a fractional reserve system developed, inherently prone to monetary expansion and panic.
In the late nineteenth century, a movement toward bank centralization arose among both “progressives” and bankers, the latter eager to increase their profits. From these plans, the Federal Reserve System developed. Rothbard shows the dominate influence of the banking House of Morgan at the Fed’s inception. During the New Deal, Rockefeller interests took first place in influence, with the Morgan interests reduced to a subordinate though still potent role.
The book concludes with an account of the Fed’s role in causing inflation and the business cycle. Abolition of this nefarious agency must be part of any agenda for genuine financial reform.
- Introduction: Money and Politics
- The Genesis of Money
- What Is the Optimum Quantity of Money?
- Monetary Inflation and Counterfeiting
- Legalized Counterfeiting
- Loan Banking
- Deposit Banking
- Problems for the Fractional-Reserve Banker: The Criminal Law
- Problems for the Fractional-Reserve Banker: Insolvency
- Booms and Busts
- Types of Warehouse Receipts
- Enter the Central Bank
- Easing the Limits on Bank Credit Expansion
- The Central Bank Buys Assets
- The Origins of the Federal Reserve: The Advent of the National Banking System
- Origins of the Federal Reserve: Wall Street Discontent
- Putting Cartelization Across: The Progressive Line
- Putting a Central Bank Across: Manipulating a Movement, 1897–1902
- The Central Bank Movement Revivies, 1906–1910
- Culmination at Jekyll Island
- The Fed At Last: Morgan-Controlled Inflation
- The New Deal and the Displacement of the the Morgans
- Deposit "Insurance"
- How the Fed Rules and Inflates
- What Can Be Done?