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The Geithner Plan Failed in 1932


Terry Mauro
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The Geithner Plan Failed in 1932

by Glenn Mesaros

"This is not a bubble!"

Clinton White House Moderator at the April, 2000, "Conference on the New Economy".

Author Ron Chernow recently called for a new "Pecora Commission" in a New York Times op-ed, which hearkened back to the anti Tammany Sicilian immigrant who personally brought down the Wall Street scion Jack Morgan as the investigative chairman for the Senate Banking Committee in 1933.

He also revealed in his book, House of Morgan, that a facsimile to the Geithner Fund (PPPIP) failed to end the banking crisis in that year. President Obama, please take note. Your Wall Street advisors are wedded to a failed policy matrix.

Derivatives and Credit Default Swaps are nothing new on Wall Street. They facilitated the 1907 Panic. Back then, the banksters created "bucket shops" which bet on the stock market.

After JP Morgan personally contained the 1907 panic, New York state authorities outlawed such bucket shops. Unbelievably, when Greenspan, Bernanke, and Geithner deregulated the financial system in 1999, their "Financial Services Modernization Act" specifically forbade state authorities from regulating "bucket shops".

Since there was no precedent in 1932 for the Federal Reserve or Treasury Department for spending trillions of tax dollars to provide Wall Street liquidity, JP Morgan's son, Jack, assumed he could intervene again in the Great Depression to prop up the bond markets.

In the 1920's, the Wall Street banksters had bond selling departments which deployed thousands of brokers to saturate Americans with Latin American bonds, and other worthless securities. They securitized them to spread the risk, and savings banks lapped them up.

In April, 1932, after three years of economic depression, Jack Morgan felt it was time for another great Morgan "public service for profit" intervention to save the financial system: he organized 35 banks to pledge to buy $100 million in "high quality" bonds to prop up the sagging bond markets, when savings banks were failing after cashing in worthless securities.

They gave the new pool of securities a name: "Stars and Stripes Forever".

Jack Morgan wrote his Paris partners about the new venture, "If the organization of the Corporation ... should have any degree of reassuring effect upon the public so much the better."

The bond fund proceeded to make a little profit for its investors, but had no impact on the spiraling downward economic depression: 7000 banks out of 25,000 in America failed by the time FDR took office in March, 1933.

Financial devastation continued on Wall Street: Brokerages gave employees unpaid vacation days to sell apples on the streets of New York City. Some enterprising souls used worthless stock certificates to paper the walls of the Union League Club. They called Manhattan's finest new skyscraper the "Empty State Building".

Fortunately, Americans voted 22,815,539 to 15,759,930 to elect Patrician Franklin Delano Roosevelt President in November, 1932. Main Street turned irreparably against Wall Street, as Hoovervilles sprang up around the country, including Riverside Park in Manhattan.

Bar signs went up around America that said:

Hoover Blew the Whistle,

Mellon Rang the Bell,

Wall Street Gave the Signal,

and the country went to hell!

Crusty old Montana Republican Senator Burton Wheeler, who had run for Vice President, as an Independent, with Wisconsin Senator Robert Lafollette in 1924, and garnered 17% of the vote, said that the government should go after bankers like they were Al Capone.

White Shoe Morgan banker and partner Russell Leffingwell sent a note to FDR in the summer of 1932, entitled, "Dear Frank: You and I know that we cannot cure the present deflation and depression by punishing the villians, real or imaginary, of the first post-war decade (1920s), and that when it comes down to the day of reckoning nobody gets very far with all this prohibition and regulation stuff."

When "Frank" responded that the bankers were responsible for "grave abuses", and should support reforms, Leffingwell retorted, "The bankers were not responsible for 1927 - 1929 and the politicians were. Why then should the bankers make a false confession."

President Hoover had actually started the later named Pecora Commission in 1932 when he prodded the Senate Banking Committee to investigate short selling by Democratic financiers, such as the Baruch/Raskob crowd, who were the George Soros bandits of that time.

After the election, the Committee named Sicilian immigrant Ferdinand Pecora, former New York assistant District Attorney, to head up their investigation. Rolling up his sleeves, and smoking a cigar, Pecora deployed a small army of bank auditors to take over lower Manhattan. The committee gave him subpoena power to invade the sacrosanct 23 Wall Street, headquarters of the House of Morgan.

Very shortly, Pecora announced that "never before in the history of world has there been such a powerful centralized control over finance, industrial production, credit, and wages as is at this time vested in the Morgan group."

He quickly called Jack Morgan to the witness stand, and revealed that the bankster had not paid (legally) any income taxes from 1930 - 1932, using tax shelters to write off his taxes as stock losses.

When the scrappy Pecora demanded the Morgan partnership agreement, the Committee blanched, and went into executive session, as Pecora produced a hand lettered scroll which stipulated that Jack Morgan had absolute powers to arbitrate disputes, allocate undivided profits, and even dissolve the bank.

Morgan retaliated by denigrating Pecora as the "dirty little wop". As the Glass Steagall Act became law, Leffingwell blamed Chief Justice Brandeis for the private banking provisions, "I have little doubt that he inspired it, or even drafted it. The Jews do not forget. They are relentless ... I think you underestimate the forces we are antagonizing ... I believe that we are confronted with the profound political economic philosophy, matured in the wood for twenty years, of the finest brain and the most powerful personality in the Democratic party, who happens to be a Justice of the Supreme Court."

Morgan mobilized his entire mob of lawyers to stop the Glass Steagall bill, and the SEC bill, saying it would turn Wall Street into a "deserted village." Thomas C. Corcoran later exclaimed, "Rayburn and I stood alone against the batteries of lawyers sent by Morgan's and Stock Exchange, and we won out!"

The Italians, Jews, and Irish had routed the White Anglo Saxon banksters. Utah banker Mariner Eccles took over the Federal Reserve, and moved its power center from New York to Washington.

After the new laws went into effect, the House of Morgan split up on September 5, 1935. Morgan Stanley took over the bond business, and moved next door to the Morgan Bank. They underwrote $1 billion of insurance business in the following year, about 25% of the market totals.

Jack Morgan died a rich man, but the name "Roosevelt" was forbidden in his household.

- 30 -

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First the banks make common USofA citizens dependent on, and by default likely to support beyond reason, something, (in this case likely the monroe doctrine). So the ordinary person interests align with the schemes of the Rich. Then the Rich attempts to bail everyone out. Then, (as I expected any moment in reading the piece), the generalisation "the Jews" jumps out.

There. .....There the villain is exposed. And it's not the givers with one hand and taking with the other. Oh no, not them, they're Patriots!

The National Socialist Amerikan Workers' Party..a bit of "doublespeak oxymora"?

by Morons who believe their superiority will be proven by their pathological sado-masochism and all that march with them into the abyss of extinction.

And it did really happen as Americ(k)a First grew and allied with the German Bund and the KKK. .. and so the USofA Pogroms start. Once more, the hills are alive with the cries of a n hunt. (Civil Rights..Bah. The one time champions of it are dead. Assassinated all.)

____________

"Jack Morgan wrote his Paris partners about the new venture, "If the organization of the Corporation ... should have any degree of reassuring effect upon the public so much the better." "

(I wonder who his Paris partners were?)

Fascism is easily seem as an enigma. When everything is falling down they appeal to the Right and the Left. (Nationalism and Socialism - oxymoronic) But in essence their agenda is something else entirely. The marshalling of those sufficiently dumbed down and fortunate enough not to be considered 'mud', and their discovery that if they were to follow the suggestions of the Dictators then life becomes pretty good. The waged are divided and ruled with an iron fist, which through circumstances they have come to accept as necessary, and they put their blinkers on. ...until it's too late.

In an already disintegrated, divided, waged class, this 'too late' comes early. The realisation of what has happened comes too late.

But it doesn't have to be that way.

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