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INTERNATIONAL BANKING INTRODUCTION

International banking may be defined as the transactions relating to the acceptance of deposits and
loans anywhere in a currency other than that of the country in which the bank is located. The
impetus for the development of International banking curve initially from the desire to avoid
domestic monetary regulations especially in the case of US banks, Secondly, growth of the
International trade, and Thirdly, globalisation of financial markets, International banking
intermediates, world financial imbalances and maturity preferences. The Intermediation has resulted
in matching the preferences of OPEC nations for short term claims with medium term debt offered
by countries in Current Account Deficit. The OPEC nations had not only met their maturity
preferences through this process but also got the risk inherent in lending to sovereign nations
(sovereign risk) reduced apart from the reduction of risk arising out of diversified portfolio held by
an intermediary. As in the case of other forms of financial intermediation, the essence of
international banking is maturity-transformation. This process has been facilitated by the
development of Rollover Credits whereby a 10 or 12 years syndicated loan may be financed by
banks borrowing money with a six month maturity. The interest rate risk inherent in such a maturity
Mismatch is transferred from the bank to the borrower by the practice whereby interest rate is reset
every six months on the basis of interest rate paid by the bank (LIBOR) on six months money.

Banks are the key players in the financial system of country. They perform the function of financial
intermediation in an effective manner. Lately, internationalisation or globalisation of banks is being
witnessed across the world. Banks in many nations have internationalised their operations since
1970. The quantum of operations has increased in such a manner that the concept evolved into a
subject in itself.
International Banking Multination Banking Centre are used interchangeably, Multinational banking
signifies the presence of banking facilities in more than one nation.
According to AIBER, International Banking is defined as sub-set of commercial banking and
activity having a crossborder and/or crosscurrency element. International Banking comprises a
range of transactions that can be distinguished from purely domestic operations by

The currency of denomination of the transaction.


The residence of bank-customer and
The location of the banking office branch.

A transaction in local currency between a bank in its home-currency is called domestic banking,
while crosscurrency dacet is termed as International Banking.
An international bank is a financial entity that offers financial services, such as payment accounts
Band lending opportunities, to foreign clients. These foreign clients can be individuals and
companies, though every international bank has its own. In the most basic sense, international
banking is any type of banking that takes place across international borders. It's an old practice that
originated in the Renaissance as lenders loaned money to foreign kings. In the contemporary world,
it's used by individuals and companies seeking favourable banking conditions in a global
marketplace. A banker or bank is a financial institution that acts as a payment agent for customers,
and borrows and lends money. In some countries such as Germany, banks are the primary owners of
industrial corporations while in other countries such as the United States banks are prohibited from
owning non-financial companies. Banks borrow money by accepting funds deposited on current
account, accepting term deposits and by issuing debt securities such as banknotes and bonds. Banks
lend money by making advances to customers on current account, by making instalment loans, and
by investing in marketable debt securities and other forms of ending. Banks provide almost all
payment services, and a bank account is considered indispensable by most businesses, individuals
and governments. Non-banks that provide payment services such as remittance companies are not
normally considered an adequate substitute for having a bank account. Banks borrow most funds
borrowed from households and non-financial businesses, and lend most funds lent to households
and non-financial businesses, but non-bank lenders provide a significant and in many cases
adequate substitute for bank loans, and money market funds, cash management trusts and other nonbank financial institutions in many cases provide an adequate substitute to banks for lending savings
to.

It begins by addressing the concept of country risk, including transfer risk, which is perhaps the
single overarching risk of all international banking operations and impacts all international
activities. This section then discusses international activities of U.S. banks, including foreign
lending, investments, placements, funds management, and foreign exchange, which are the most

significant international products and services offered by financial institutions. Within the foreign
lending component, a significant amount of attention is given to trade finance, which is a
particularly important segment of U.S. banks international credit exposures and an especially
important part of cross-border lending of state non-member banks. Foreign exchange activities, on
the other hand, are very specialized and only relatively few FDIC-supervised institutions engage in

foreign exchange to a significant degree. It discusses how U.S. banks may be owned by or
otherwise associated with foreign entities, including foreign banks. Supervision of foreign banking
organizations (FBOs) is a primary part of this latter discussion. Also discussed are parallel-owned
banking organizations (PBOs), where there is common ownership of domestic and foreign banks
outside of a bank holding company structure (i.e. similar to chain banks). This section concludes
with discussions of certain laws relevant to international banking and a glossary of international
banking terms. This section has been geared to meet the basic needs of an FDIC examiner
encountering international banking. Examiners needing more extensive guidance may wish to refer
to examination manuals of the Federal Reserve or Comptroller of the Currency. The International
Section in Washington may also have additional resources at its disposal to assist with unusual
situations. The last few decades have witnessed distinct growth in the ability of firms and countries
to access the global capital markets. During this time span, access to capital (bank credit, equity
and/or fixed income bond issuance) has become more abundant and competitive. However, failure
to price, select, and manage international risks, both on and off-balance sheet, has resulted in well
publicized reductions in profitability, operating losses, and sizable capital charges, particularly
during the late 1990s through 2001 (Asian Crisis 1997; as well as, Russian-1998, Ecuador -1999,
and Argentine-2001 sovereign defaults). While the number of U.S. banks significantly involved in
international finance is relatively small, certain large banks have notable volumes. Moreover,
smaller banks have also allocated significant capital and resources to international banking in select
markets. Given the extent of risk introduced by a sovereign country, particularly an emerging
market economy, it is necessary that the examiner understand and review international activities
when assessing a bank's overall condition. The international operation of a bank may be conducted
in a separate division or department even though many of the activities parallel those performed
elsewhere in the bank. Large banks typically operate an international division, which may include a
network of foreign branches, subsidiaries, and affiliates. Smaller banks or those with limited
international activity often use only a separate department in conjunction with a network of foreign

correspondent banks. In either case, the international section will usually have its own management
and staff, as well as distinct accounting systems and controls. Examination Objectives The
objectives of examining an international department are basically the same as those of examining
other areas of the bank. However, some modification of examination techniques and procedures
may be required because of the specialized nature of international banking. Documentation and
accounting procedures for international operations may differ from domestic banking, and the
department may operate under separate laws and regulations. The examination of the international
department is usually conducted concurrently with the commercial examination of the bank.

Personal examination planning should be used to determine the scope of the examination and
personnel requirements. A good starting point is to review a bank's most recent Uniform Bank
Performance Report (UBPR), Reports of Condition (for information concerning on balance sheet
assets and liabilities - foreign debt securities RC-B(6b); bankers acceptances RC 9&18; loans to
foreign banks RC-C2; or off-balance sheet instruments, including letters of credit RC-L4 and OTC
derivatives RCL 12) and examination reports. These reports will indicate the existence of an
international department, foreign branches or subsidiaries, the volume of international activity, and
the nature of the bank's international business. Review of the banks most current 009, 009a, and
019 Country Exposure Reports can also assist in determining the level of country exposure if the
bank is required to file the reports. The examination can usually be conducted at the bank's head
office or some other centralized location. Banks that operate foreign branches or subsidiaries
usually maintain sufficient duplicate records at home offices to permit a centralized international
examination. In fact, Part 347 of the FDIC's Rules and Regulations imposes minimum
recordkeeping standards upon state non-member banks that operate foreign branches or
subsidiaries. These standards require that a bank maintain at its head office duplicate records of
offshore operations which will permit a centralized review of asset quality, funding operations,
contingent liabilities, and internal controls. In most cases, it is expected that this duplicate
information will be adequate for examination purposes. On-site examinations of foreign branches
will be necessary in some cases because of inadequate information at the head office or unusual
features concerning the activities of the branch. Overseas examinations should be planned very
carefully in order to use personnel effectively. It is important that the international examiner
determine the availability and quality of information maintained at the head office before
commencing a foreign branch examination. To do this it may be advisable to conduct a preexamination visitation or begin the foreign branch examination after commencing the domestic
examination. Examiners will find many similarities between a bank's international and domestic

operations. For example, a bank will extend credit, issue and confirm letters of credit, maintain cash
and collection items, maintain foreign and domestic correspondent bank accounts, accept and place
time deposits, accept customer deposit accounts, and borrow funds both domestically and
internationally. Other activities are unique to international banking. Creating acceptances and
trading in foreign exchange are among these activities. Another element of international operations
not found in domestic banking is country risk. This refers to the political, economic, and social
conditions of countries in which a bank has exposure and it must be taken into consideration when
evaluating a bank's international operation. International banking is a dynamic field that embraces a
wide spectrum of financial services and practices. This section of the Manual is not intended to
provide exhaustive coverage of the subject; rather, the discussion is limited to the basic functional
areas of international banking. Many of the activities of an international department parallel those
conducted in other areas of the bank. In these instances, treatment of the topic is limited largely to
those features pertinent to international banking. For this reason, the examiner will find it necessary
to refer to other areas of the Manual. Also, there are a number of laws, regulations and Corporation
policy statements which deal wholly or in part with international banking. These are discussed
throughout the text of this section and several are reviewed under the Laws and Regulations section.
Examiners should be familiar with these laws, regulations, and satisfaction if not all, facets of
international banking is a component of risk known as country risk. Because of the increasing
volume of international lending and other activities at U.S. banks, the three Federal bank regulatory
agencies have adopted a uniform policy against which they will assess a banks country risk
management program. This policy is the March 2002 statement entitled Sound Risk Management
Practices for Country Risk (March 2002 Statement). Examiners should assess a banks country risk
management program by comparing its policies and processes to the standards set forth in this joint
statement. The results of the examiner's evaluation should be included, in narrative form, on the
report page entitled "Analysis of the Country Exposure Management System." The remainder of
this section briefly describes the concept of country risk; the elements of an effective country risk
management process; and how the three Federal agencies evaluate transfer risk, which is a
component of country risk, in bank examinations. The foundation for the discussion that follows is
the March 2002 Statement and the 1998 Guide to the Interagency Country Exposure Review
Committee (ICERC). Examiners should consult these primary documents for further information.
Concept of Country Risk Along with the risks present in their domestic operations, institutions
engaged in international activities are exposed to country risk the risk that economic, social, and
political conditions and events in a foreign country will adversely affect an institutions financial
interests. In addition to the adverse effect that deteriorating economic conditions and political and
social, and political conditions and events in a foreign country will adversely affect an institutions
financial interests. In addition to the adverse effect that deteriorating economic conditions and

political and social unrest may have on the rate of default by obligors in a country, country risk
includes the possibility of nationalization or expropriation of assets, government repudiation of
external indebtedness, exchange controls, and currency depreciation or devaluation.

Country risk has an overarching effect on an institutions international activities and should
explicitly be taken into account in the risk assessment of all exposures (including off-balance sheet)
to all public- and private-sector foreign-domiciled counterparties. The risk associated with even the
strongest counterparties in a country will increase if, for example, political or macroeconomic
conditions cause the exchange rate to depreciate and the cost of servicing external debt to rise. The
March 2002 Statement recognizes that country risk is not necessarily limited to an institutions
exposures to foreign-domiciled counterparties. In some situations, the performance of domestic
counterparties may also be adversely affected by conditions in foreign countries. Where
appropriate, and to the extent practicable, country risk factors should be taken into account when
assessing the creditworthiness of domestic counterparties. Country risk is not limited solely to
credit transactions. Investments in foreign subsidiaries, electronic banking agreements, and EDP
servicing and other outsourcing arrangements with foreign providers all carry with them the risk
that policies or conditions in a foreign country may have adverse consequences for an institution.
Although the details and complexity of the country risk management process will vary from one
institution to the next, such management must be commensurate with the volume and complexity of
the institutions international activities. Supervisory expectations will also take into consideration
the institutions size and technological capabilities. As more fully described in the March 2002
Statement, a sound country risk management process includes the following nine components:
Effective oversight by the board of directors;
Adequate risk management policies and procedures;
An accurate system for reporting country exposures;
An effective process for analysing country risk;
A country risk rating system;
Established country exposure limits;
Regular monitoring of country conditions;
Periodic stress testing of foreign exposures; and
Adequate internal controls and audit function.

The March 2002 Statement notes that to effectively control the risk associated with international
activities, institutions must have a risk management process that focuses on the broadly defined

concept of country risk. A country risk program that is limited to an assessment of transfer risk and
especially one that solely relies on transfer risk designations assigned by the ICERC is not
acceptable. Transfer risk and the ICERC program are discussed in subsequent subsections. With
regard to regular monitoring of country conditions, external shocks and adverse market conditions
during the 1990s, culminating with the Argentine sovereign default in 2001, have underscored the
importance to further develop this risk management area. The effectiveness of a banks monitoring
of country conditions and ensuing action plans during episodes of increasing country risk are of
paramount importance in ultimately mitigating credit risk and losses. Inherent to satisfying this
objective is the development of board-approved policy guidelines regarding exit strategies (action
plans) with defined trigger points to effect the reduction of exposure in a given country portfolio
when conditions warrant. The substance of an exit strategy should be commensurate with the degree
of sophistication and exposure of a given institution. Items for consideration in the exit plan may
include how a bank will reduce exposure to the following:
Aggregate (total country exposures)
Asset class (Loans, Placements, corporate Euro TN, bonds, CP)
Issuer (sovereign versus private sector for either a bank or corporate issuer),
Product risk (Trade transaction versus Working Capital, Pre-export finance, or off-balance sheet
item LCs/derivative), and by
Tenor (generally, consensus should be towards reducing tenor or duration during periods of
increasing country risk).

Management can also incorporate risk reduction strategies stemming from contagion risk or the
likelihood of economic problems in one country, region or emerging market impacting another.
Trigger points to affect an exit strategy, either gradual or complete elimination of country exposure,
will vary with the size and complexity of a given institution. Both quantitative and qualitative data
should be used to define, substantiate, and initiate action to reduce risk. Regardless of the forms
used, some measures should be formally incorporated into policy that will serve to alert
management that risk has escalated beyond an acceptable threshold and that action is now
necessary. With regard to the type of data collected to initiate action, market intelligence garnered
from the banks internal country studies, representative office, officer visits to the home country
central bank or correspondent bank, as well as nationally recognized statistical rating organization
(NRSRO) may be useful sources of information. For instance, Foreign/Local Currency Ceiling
Ratings for the Sovereign, Foreign /Local Currency Deposit Ratings for Banks, and Bank Financial
Strength Ratings (including credit watch events and outlook changes positive-negative) could be

effectively employed. Such information should serve to stimulate discussion and assessment at
senior management levels as to the scope and nature of the banks current exposure and whether
reductions are necessary. Once exit strategies are employed, monthly or quarterly reporting should
be provided to the banks board of directors to update the board on the ongoing nature of exposure
and progress towards reducing and/or limiting risk. Transfer risk is a facet of country risk. Transfer
risk is the possibility that an asset cannot be serviced in the currency of payment because the
obligors country lacks the necessary foreign exchange or has put restraints on its availability. In
general, transfer risk is relevant whenever a bank extends credit across international borders and the
extension of credit is denominated in a currency external to the country of residence of the obligor.
In these circumstances, an obligor must, in the absence of the ability to earn and/or borrow and
retain foreign currency outside the country of residence, obtain the foreign currency needed to
service an obligation from the central bank of the country. Where a country is beset by economic,
political, or social turmoil leading to shortages of foreign currencies at the central bank, the
borrower may be unable to obtain the foreign currency and thus default on the obligation to the
lending bank or, alternatively, request a restructuring of the debt. Although a banks country risk
management program must be based on the broadly defined concept of country risk, the Federal
banking agencies use transfer risk as a tool to consistently assign classifications and other
designations to cross-border exposures, determine minimum reserve requirements on cross-border
exposures, and measure cross-border concentrations.

HISTORY

Author O.P. Agarwal International Banking and Finance,


In ancient Greece, around 2000 B.C., the famous temples of Ephesus, Delphi, and Olympia were
used as depositories of peoples surplus funds and these temples were the centres for money-lending
transactions. The priests of these great temples acted as the financial agents until public confidence
was destroyed by the spread of disbelief in the religion. Traces of credit by compensation and by
transfer orders are found in Asayria, Phoenicia and Egypt before the system attained full
development in Greece and Rome.

In India, the ancient Hindu scriptures refer to the money lending activities in the Vedic period.
During the Ramayana and Mahabharata eras, banking had become full-fledged business activity and
during the Smriti period, which followed the Vedic period and Epic age the business of banking was
carried on by the members of the Vaishya community. Manu, the great lawgiver of the time, speaks
of the earning of interest as the business of Vaishyas. The Bankers in the smriti period performed
most of those functions which banks perform in modern times such as accepting of deposits,
granting secured and unsecured loans, acting as their customers beilee, granting loans to Kings in
the time of grave crises, acting as the treasurer and banker to the state and issuing and managing the
currency of the country.

During the Mogul period, the indigenous bankers played a very important role in lending money
and financing of foreign trade and commerce. They were also engages in the profitable business of
money changing. Every town, big or small, had a Sheth or Nagar Sheth who performed a number
of banking functions. These sheths, besides doing money lending business, were instrumental in
transferring funds from place to place and doing collection business mainly through hundies. The
hundies were an acceptable mode of transfer of monies for commercial transactions.

The origin of International banking dates back to the IInd Century B.C. when Babylonian Temples
under the code of Hammurabi, safeguarded the idle funds of the affluent and extended loans to
merchants to finance the movement of goods. Similarly, during the period 500-300 B.C. banks in
Greece regularly advertised interest for deposits and routinely handled foreign money payments.
Later during the Roman civilization, a variety of financial instruments like bills of exchange were
legalised to encourage trade between regions. Subsequently, the renaissance of Europe in the 14 th
Century gave rise to the concept of lending to Kings, which slowly emerged into international
banking. During 14th and 15 th centuries the Florentine banking houses had branches, subsidies and
offices throughout Europe to facilitate trade among nations in wool, cloth and silks. The loans
extended by these banks were the first instances of international lending by the pre-runners of the
modern banks to the forerunners of the modern governments.

The 19th century witnessed many innovations in the international lending, leading to trade financing
and investment banking. Trade financing started as short-term commercial lending, is used to
finance commodity exports and imports or to deal in foreign exchange. Investment banking
consisted of the placement of long-term funds in fixed interest securities on agency or undertaking
basis to enable infrastructural and industrial development of the two, investment banking accounted
for the great bulk of the international lending, and financial companies acted as agents or
underwriters for the placement of funds, and thus originates the concept of Capital Market.

By the year 1920, American baking institutions dominated international lending, and the European
nations were the major borrowers. There was perfect international banking system existing till the
time of First World War. But post First World War period was characterised by a series of bank
failures, default and violent contractions in international trade and investment. These developments
shattered confidence in international lending. Banking across national borders came to a grinding
halt in the early year of 1930 and did not resume till the Second World War. The Bretton Woods
System, in New Hampshire, U.S.A., evolved a system of convertible currencies, fixed exchange
rates and free trade. International Monetary Fund and World Bank was established. This system
installed a secured financial framework and revolutionalised the economic life by creating a global
shopping center. After this internationalisation of banking operations was started by major
commercial banking institutions in U.S.A., UK, Canada, France, Germany, Switzerland and Japan.
Bank for International Settlements (BIS) established in the year 1930, was mandated to facilitate
reparation payments imposed on Germany by the Treaty of Versailles though effecting cooperation
among central banks. BIS is also co-ordinating with other agencies for achieving this goal. In the
addition BIS acts as banked to Central Banks. India is one of the 50 members of BIS with voting
rights and representation. International banking speeded up after the first oil crises in 1973.
Professional improvement in the telecommunication sector, across the world, supplemented the
growth of international banking.

Consolidation ERA

Internationally, the reformation process commenced in the early 1980s, when prudential norms from
BASEL were imposed on the banking system among the developed nations, for the first time.
Compliance with these norms led to downsizing of some banks while the stronger ones consolidated
there position and went on to expand via the mergers and acquisition route, both domestically and
internationally. This was beginning in USA. The same phenomenon was less pronounced in the
more conservative nations of Europe. There, the obsession was to US Dollar and thereby hope to
dominate the markets in the third millennium. That done, the stage was set for the consolidation of
financial institutions across European nations with cross-border mergers and acquisitions and that
already started and took place. The exception there was Russia, which was in shambles but who

knows the someday their ancestral ties with the European nobility, of which there were a part before
the Revolution, and they may claim a right of entry into Euroland, the same way as two Germanys
united. If this were to happen, the banking will see the emergence of the United States of Europe.

Further East, it is not too difficult to visualise the financial integration of the oil producing nations
of West Asia, into a single economic block. That will inevitably lead to the consolidation of the
banking institutions of the Islamic world cemented more by religious faith than economic necessity.
Farther East, the typhoon that swept across South-East Asian nations in 1997 shattered their
economies while the very same banking institutions that create the miracle of these Tiger
Economies lie in tatters. Their consolidation has been a lot more painful than that experienced by
their Western counterpart. In the Far-East, the Japanese banks were in doldrums and the story of
China had no less enviable as nobody knew the side of the hold to plug.

All these developments inflicting the economics of the world in varying degrees are shore of on
single need. i.e. capital, which will flow from nations that have it and have abundance, to nations
that do not have, while economies in distress attempt to repair their damage by downsizing their
financial institutions and banks and consolidating them domestically, it is capital flows from the
Dollar and Euro that augurs well for strong domestic and foreign banks to dominate the financial
sector.

Basel Capital Accord - II

Recognising the need for a more broadbased and flexible framework, the Basel Committee released
a document in Jan. 2001 which contained refined proposals for the three pillars of the New Accord,
for measuring both credit and operational risk of international banks. Its implementation date started
in experimental banks from Jan. 2005 and finally has come in operation from 31st March 2008.

RBI widens Basel II Coverage

Under new norms, banks will have to provide for larger range or risks. As part of efforts to prepare
Indian banks for compliance with new risk management norms under Basel II, sector regulator
Reserve Bank of India (RBI) ON 27-03-2008 issued guidelines asking them to keep adequate
capital to meet wide areas of risks, including those that could damage their reputation.

The guidelines issued on the supervisory review process (SRP) ask banks to make provision for
risks relating to credit concentration, liquidity, settlement risk, reputation strategy and
underestimation of credit risk that were not specified earlier.

As such, banks may have to keep additional capital, considering the possibility of under estimation
of risks and quality of risk management, the guidelines stated.

Already, the RBI has issued two guidelines on minimum capital ratio and market disciplines for
Basel II norms called Pillar I and Pillar III.

While minimum capital ratio recognises three risks credit, market and operational risks, the
guidelines issued on Thursday specified new risks as well.

With this, banks will be insulated against the risks that are not completely captured by the minimum
capital adequacy ratio and caused by external factors, according to the new guidelines.

The guidelines also aim at encouraging banks to develop and use better techniques for monitoring
and managing their risks.

Bank would be required to have a well-defined internal assessment process to assure RBI that
adequate capital is held toward various risks they are exposed to.

However, these norms provide only broad principles to help bank in developing their internal
capital adequacy assessment process.

Foreign banks and those Indian banks that have operations outside the country have to implement
the Basel II norms from March 31, 2008, while for all other commercial banks, excluding the local
area banks and regional rural banks, the rules will come into effect from March 31, 2009.

An extremely abbreviated, extremely general history of banking is a narrative in which banks get
bigger to accommodate the need for bigger loans. The Bank of England, for instance, was founded
in 1694 to support the post-revolution government during the Nine Years War against France. For
the next two centuries or so, countries around the world chartered national banks when they needed
more money than any existent institutions could offer. See where this is going? When theres a
really expensive war, theres a demand for more money than any bank has to lend. Especially if a
country hasnt finished paying for the last war, and most of the things that made its society
productivefactories, houses, able-bodied young menhave been bombed to ruins. The guys who
were in charge at the end of WWII also realized that WWII happened, in part, because the guys who
were in charge at the end of WWI expected Germany to pay for the damage it had done. They
decided that this kind of world problem would need some kind of world bank to help pay for cleanup. Leaders of the Allied nations and their economic advisors met in Bretton Woods, New
Hampshire to hash out plans for the organizations that would fund and oversee post-war
reconstruction and international trade. The Bretton Woods system also established stable
international exchange rates, to prevent any one countrys economy from collapsing beyond repair.

If they hadnt already figured out that an economically volatile nation was likely to cause problems,
the World Wars proved that asking a bankrupt country for reparations was not a good way to foster
world peace. The Bretton Woods conference took place in July, 1944. My fellow WWII enthusiasts
and those of you who paid attention in history class will note that the war wasnt over at this point,
but it was looking good for the Allies. It was looking especially good for the Americans, who had
the unique advantage of territory and infrastructure that had not been bombed to ruins.
Delegates created the International Monetary Fund, the International Bank for Reconstruction and
Development, and the General Agreement on Tariffs and Trade. This wasnt the first time an
international central bank had been established; prior to the start of WWII, the Bank of International
Settlements was responsible for collecting WWI reparations from Germany. The BIS, based in
neutral Switzerland, could possibly have filled the role of the IMF, except that its vaults were full

looted Nazi gold Of course, a bank needs reserves, and there were disagreements as to what the
Woods, wanted a new currencybanco, unites, dolphin, bezant, daric, and heaven knows what.
The Americans successfully argued for US dollars, backed by the gold standard. Keynes wasnt
arguing for one currency to be used worldwide for all transactions, nor did every country switch to
dollars after the IMF adopted them as reserve currency. The Bretton Woods decision meant that
money going in and out of the IMF happened to be dollars, whose value was supposed to be fixed
on a gold standard. When the IMF began operations in 1945, gold cost $35 per ounce. Since dollars
were the international reserve currency, any country that held dollars could spend them, or convert
them to gold. The US needed to provide enough dollars for all of the IMFs activities on top of
national spending. The gold standard prevented inflation, and nations could borrow and lend
knowing that the currency wouldnt devalue, because an ounce of gold cost $35, period. Gold is a
nice standard to have because its rare, and there is a decent amount of it, but it didnt take long
before the world needed more money than the supply of gold could back for $35 per ounce. We kept
spending more and more money ourselves because we wanted to. Also, Korea. Also, Vietnam. Had
we poured fewer dollars into the global marketplace, everyone else would have collapsed. But as
soon as the rest of the world began to suspect that there were more than $35 out there for every
ounce of gold, they started trading in their sweet, fragrant bank notes for shiny, precious goldeven
if someone wanted $40 for an ounce. Spoiler alert: We dropped the gold standard. Rather, President
Nixon did, in 1971, without asking the IMF what they thought of the idea. The IMF was already
planning a move away from total dependence on the value of the dollar, and from 1970 to 1972 they
created billions of units called Special Drawing Rights. Today, one SDR is worth sixty-six cents,
eleven pence, twelve yen, and forty-two euro-cents. The unit is referred to as a basket, and the

amounts of each currency are re-calculated every five years based on existent exports and reserves.
Because they include multiple currencies, SDRs are relatively stable. For some, including Peoples
Bank of China president Zhou Xiaochuan, SDRs are a better option than any one currency or
floating value, reminiscent of Keynes original vision for the IMFs reserve unit. SDRs arent
exactly hot commodities, but the IMF has handed out 21.4 billion of them for countries to lend and
borrow. They could potentially function like any other currency, with the IMF controlling the
supply, except that they cant really buy anything except other currency, and the IMF allocates more
of them to wealthy nations. Furthermore, nations are actually supposed to just hang on to them,
because the IMF gives everyone a certain number, and if you have fewer SDRs by the end of a
given week because you traded some for pounds sterling, the IMF charges interest. Conversely, if
you got some extra SDRs from someone, the IMF pays interest on your surplus.

A recent policy brief from the Peterson Institute for International Economics suggests that SDRs
might become more widely used in international commerce, but suffer from an oddly familiar
problem: no one has an incentive to be an early user of an asset whose appeal comes from its use
by others. The first International Bankers were the Knights Templar, a secretive society created
and sponsored by an even more secret society known as the "Priory De Scion" during the time of
the Christian Crusades to recapture the Holy Lands from Muslim control. The "Priory De Scion"
has had considerable historical influence in Europe from the time of the Crusades to the present.
The reason that most persons have not heard of the "Priory De Scion" is that they work secretly
behind the scenes. Christopher Columbus was a secret member of the "Priory De Scion" and on his
voyage of discovery to the "New World," his Flag Ship had the Templar Cross emblem on the Main
Sail. This was unusual because the Templars had been outlawed by that time in history.

A list of the "Grand Masters of the Priory De Scion" would include such notables as Leonardo da
Vinci and Sir Isaac Newton. This secret organization still wields extraordinary secret power in
modern Europe and has exercised a large influence in creating the present European Union. The
Knights Templars were required to take oaths of poverty and chastity to become members. Their
stated mission was to guard the roads to the Holy Land. Their popularity became so great that they
became a political force with which even kings had to reckon. They created safe depositories where
lords could leave their treasure in safekeeping while on pilgrimages to Jerusalem. These early form
of banks, which were created across Europe and the Middle East from France to Jerusalem, were
the first international banks. They also developed an early system of checks so that money could be
drawn from a "bank" in Jerusalem by a Lord writing a check based on his treasure being held in a

Paris bank. On Friday the 13th in October of 1307, the Templars were Outlawed by a Papal Bull
which charged them with Heresy. On this unlucky day, all the Knight Templars in France were
simultaneously arrested. Many were surprised by this unexpected turn of events because the
Knights Templars were considered the army of the Catholic Church. In fact, it took considerable
effort on the part of the King of France, Phillip IV, to influence the Pope to make this declaration.
Part of this effort included holding relatives of the Pope hostage to insure the declaration was made.

Phillip IV had his own motives. He had borrowed heavily from the Templar Treasury to finance his
wars against England. If he could get the Templars outlawed, not only could the debt be cancelled
but the Templar banks, with their treasure, could be seized. The Priory De Scion's intelligence
network had advance knowledge of the King's secret plan to have the Knights Templars outlawed
and arrested. They advised the Templars to give up peacefully. They were told that they would be
protected by the Church and found innocent at a later trial. All the treasure in the Templar banks
was removed from France accompanied by the best Templar Knights on the Templar Fleet which
sailed to Scotland. Later, this treasure and these fighting Knights were allied with Scotland's Fight
for independence from England. While Jacques de Moly the Templar leader of France, was
imprisoned, he secretly directed the establishment of Occult or Hermetic Masonry, establishing four
Lodges; one in Naples, one at Edinburg, one at Stockholm, and one at Paris. The Templars, which
were arrested, were not protected by the Church as expected. Many were horribly tortured to
extract confessions of guilt. Their leader, Jacobus De Moly was burned at the stake in a public
square of Paris. Just before his death, De Moly placed a curse on the King of France and the Pope
stating that he would see them before the throne of God before a year passes. Perhaps due to the
secret influence of the Priory De Scion, the Pope and King perished within the year in a strange and
sudden manner. Squint de Florin, the chief denouncer of the Templars was assassinated. Outlawing
of the Knights Templars drove them underground as the secret order of the Free Masons throughout
Europe.

The Freemasons became the arch enemies of the Catholic Church, because of the

perceived betrayal of the Templars by the Church, and worked behind the scenes to promote the
later Protestant Reformation, and more freedom for mankind. The Vatican's militant order of the
Jesuits was sent to England to fight the heresy of Protestantism. Jesuits diligently searched for

heretics to punish, thus guaranteeing that Freemasons would keep their secrets well-hidden if they
wished to keep their heads.

John Locke, used the Masonic Charges in writing the Constitution for the proposed colony of South
Carolina, which was to later become a bastion for Freemasonry. Also, the writings of Sir Francis
Bacon demonstrated the philosophies of the Freemasons. The founders of the Virginia Company
were also Freemasons. Later the Masons would make their presence felt in the New World with the
Boston Tea Party, organized by the Boston Freemason Lodge and the Declaration of Independence.
The latter document was composed and signed primarily by Freemasons. George Washington and

most of his Generals were also Freemasons. In truth, without the Freemasons there would have
been no United States of America!

The next significant impact on history was made by the Jewish money lenders of Amsterdam.
These money lenders had considerable influence in the "behind the scenes" politics.
The Jewish Rabbi who were the religious and political leaders of the scattered Jewish people and
the Jewish money lenders combined their forces in a group known as the "Elders of
Zion." From 1640 to 1689, these "Elders of Zion" in Holland plotted the English Revolution, and
were lending money to the various factions. These Jewish money lenders used their influence to
elevate Mr. William Stadtholder to Captain General of the Dutch Forces and then to
William, Prince of Orange.

Then, they arranged the meeting of William Stadtholder with

the English Duke of York's eldest daughter, Mary. The Duke of York was next in line to be the
King of England. In 1677, Prince William of Orange married Princess Mary of York. When the
Duke of York suddenly died, Prince William of Orange and Mary became the next King and Queen
of England in 1689. Then, King William persuaded the British Treasury to borrow one and a
quarter million British pounds from the Dutch bankers who had placed him in power. The terms of
the loan were as follows:

1. The names of the lenders be kept secret and that they be granted a charter to establish a bank
of England.

2. The directors of said bank be granted the legal right to establish the gold standard for
paper currency.

3. That they be allowed to lend out 10 pounds of paper currency for every 1 pound of gold held
on deposit.

4. That they be allowed to consolidate the national debt and secure amounts due as principal
and interest by a direct taxation of the people.

This form of "fractional banking" would allow 50% yearly return on actual bank assets at an interest
rate of 5% per year. And the people of England would pay the bill! A similar banking scheme
would later appear in the United States with the Federal Reserve Act of 1913. These lenders never
intended that the loans be repaid for they profited mainly from the interest and the indebtedness
gave them political leverage.
to 16,000,000 Pounds

in 1698.

England's national debt went from 1,250,000 Pounds in 1694


Mystery

often

international banking, the House of Rothschild.

surrounds

that

secretive

centre

of

In 1750, Mayer Amstel Bauer purchased his

fathers banking business in Frankfurt and changed his name to Rothschild. Mayer became married
and had five sons and five daughters. His sons names were Amstel, Salmon, Nathan, Kalan,
and Jacob. His fortunes increased when he came into the good graces of the Prince William IX
of Hess-Hanau, whom he was known to have attended Freemason meetings in Germany. This
Prince derived a large income from renting his Hessian mercenary army out to the
King of England. These same troops would later combat George Washington's revolutionary army
at Valley Forge. Rothschild became Prince William's trusted banker. When Prince William had to

flee to Denmark because of political upheaval in Germany, he left six hundred pounds, the
mercenary army's payroll, in Rothschild's bank for safekeeping. The money was then sent to
London with Nathan Rothschild to start a bank there.

Gold was brought from the

East India Company for use as security. Fourfold profits were made on paper money loans to
finance the Duke of Wellington's military operations, and later, on the sale of the gold which was
supposed to be the security for the paper money. This was the beginning of the great fortune of the
House of Rothschild. An international banking operation was started by setting each son with a
bank

in

different

countries;

Amstel in Berlin,

Salmon in Vienna,

Jacob in Paris

and

Kaltman in Naples. Salmon Rothschild was a member of the Freemasons. Meyer Rothschild made
a will which outlined how the family fortune was to be managed. The males would manage
the fortune, the eldest son would have the deciding vote when disagreements would arise and all
accounting and other records would be kept strictly secret not even open to governments. In 1773,
Meyer

Rothschild

held

secret

meeting

in

the

House of Rothschild

at Jundestrasse,

Frankfurt Germany, with twelve wealthy and influential European Financiers to discuss a manual of
action to gain eventual control of the entire wealth of the world.

At this meeting, the English Revolution and the means of gaining control of England's wealth was
discussed and the formal outline which would eventually be known as the 24 "Protocols of the
Elders of Zion" were outlined. These Protocols had their roots in the Sanhedrin during the
Babylonian captivity of Israel and were develop as a means to covertly destabilize enemy nations.
These Protocols were kept quite secret, but in 1901, these documents fell into the hands of
Russian Professor S. Niles. He had them published in Russian under the title: "The Jewish Peril."
Victor Marsden then had them translated into English under the title: "The Protocols of the Learned
Elders of Zion" in 1921. These may have changed somewhat since the original meeting in 1773.
The First Protocol stressed the importance of gaining control of money in order to gain control of a
nation:

"...Whether a State exhausts itself in its own convulsions, whether it's internal discord brings it
under the power of external foes, in any case it can be accounted irretrievably lost: It is in our
power. The despotism of Capital, which is entirely in our hands, reaches out to it a straw that the
State, willy silly must take hold of, if not it goes to the bottom. ..."

The second Protocol stressed the need to control the press

"...In the hands of the States of today there is a great force that creates the movement of thought in
the people, and that is the Press. ..."

The third Protocol shows the means of increasing their power:

"...We appear on the scene as the alleged saviours of the worker from this oppression when we
propose to him to enter the ranks of our fighting forces Socialists, Anarchists, Communists to whom
we always give support in accordance with an alleged brotherly rule (of the solidarity of all
humanity) of our social masonry. ..."

The fourth protocol states the need to lessen the peoples faith in God:

"...It is indispensable for us to undermine all faith, to tear out of the minds of the Goyim (Gentile)
the very principle of Godhead and the spirit, and to put in its place arithmetical calculations and
material need. ..."

The fifth protocol states the need to create confusion:

"...In order to put public opinion into our hands we must bring it into a state of bewilderment by
giving expression from all sides so many contradictory opinions and for such length of time as will
suffice to make the Goyim lose their head in the labyrinth and come to see that the best thing is to
have no opinion of any kind in matters political. ..."

The sixth protocol states the need to create the desire for luxury in the common man:

"... To complete the ruin of the industry of the Goyim ... we have developed among the Goyim the
greedy demand for luxury that is swallowing up everything ... We shall raise the state of wages,
which however, will not bring any advantage to the worker, for at the same time, we shall produce a
rise in prices...In order that the true meaning of things will not strike the Goyim before the proper
time, we shall mask it under an alleged ardent desire to serve the working classes and the great
principles of political economy about which our economic theories are carrying on an energetic
propaganda."

The seventh protocol states the means to gain control of existing governments:

"The intensification of armaments, the increase of police forces is all essential for the completion of
the aforementioned plans. What we have to get at is that there shall be in all the States of the world,

besides ourselves, only the masses of the proletariat, a few millionaires devoted to our interests,
police and soldiers. ..."

The eight protocol shows the means of training and controlling national leaders:

"... Our directorate must surround itself with all those forces of civilization among which it will
have to work. It will surround itself with publicists, practical jurists, public administrators,
diplomats, and finally with persons prepared by a special super educational training in our special
schools ... For a time until thee no longer be any risk in entrusting responsible posts in our States to

brother Jews, we shall put them in the hands of persons whose past and reputation are such that
between them and the people there lays an abyss, persons who in case of disobedience to our
instructions, must face criminal charges or disappear. This in order to make them defend our
interests to their last gasp."

The ninth protocol shows the means of using human weakness to create the international super
government:

"... And the weapons in our hands are limitless ambitions, burning greediness, merciless vengeance,
hatreds and malice. It is from us that the all engulfing terror proceeds. We have in our services
persons of all opinions, of all doctrines, rest orating monarchists, demagogues, socialists,
communists, and utopian dreamers of every kind. We have harnessed them all to the task: Each one
of them on his own account is boring away at the last remnants of authority, is striving to overthrow
all established forms of order. By these acts all states are in torture; they exhort to tranquillity, are
ready to sacrifice anything for peace: But we will not give them peace until they openly
acknowledge our international Super Government, and with submissiveness."

There are 24 of these Protocols and these are but short excerpts from some given to convey the
spirit of their method for overthrowing the Nations of the World. A complete reading of the
Protocols would reveal why the present World is in the present confused mess. After outlining the
plan

for

world

domination,

the

Banking house

of Rothschild

commissioned

Adam Wieshaupt to form the secret Order of the Illuminati. Adam Wieshaupt was
raised in a Jesuit convent and eventually became a professor of Canon law. Later, as
he became disillusioned with Catholicism, he became the personal student of the
Jewish philosopher Mendelssohn, and was converted to Gnosticism. Illuminist certainly
existed before Adam Wieshaupt made his appearance in the world. The inner circle of
initiates of the Rosicrucians Order were considered "illumined."

This term was in

reference to the auric light that surrounded one who was truly bathed in the light of
the spirit. This was considered a very real phenomenon in Europe before the infection
of Cartesian logic which denied the existence of spirit.
contemporaries

were

said

to

have

witnessed

the

For example, certain


glowing

aura

of

Saint Francis De Assisi. Enlightenment had been considered a worthy quest since the
times of Hermes. However, it was Adam Wieshaupt who formed the secret order
of Illuminati which has proven to be a tremendous deception. Here Novitiates were

told that the Illuminati held the secrets to many great mysteries which they could
gradually be initiated into as they progressed through the degrees and were proven
worthy.

This "secret

knowledge"

proved

to

be

an

enticing

lure

to

many

worthy persons. The stated purpose of the Illuminati was to eliminate all the evil
conditions of society and return man to his natural happy state. Since this meant
tearing down the powerful Monarchy and the Church, dangerous enemies would
be created. So, secrecy was an important feature of the Order. The Illuminati was
organized as circles within circles, with certain levels of secrecy maintained on the
inner circles. Only those in the innermost circles knew the true goals of the Illuminati.
Members in the lower degrees were told that they were no higher degrees and their
Grandmaster's identity

was

kept secret.

Deception

is

the

secret

of

this

organization's success and truth its greatest enemy. The Organization has a global
reach today. The outward manifestation of the Illuminati is the "New World Order."
However, the men truly at the "levers of control" are safely hidden from the
public eye. This fantastic deception was conceived while Wieshaupt was employed as
a professor of Cannon law at the University of Ingolstadt in Bavaria. The Illuminati was
formally founded by Wieshaupt on May 1, Ironically, this secret order was being
formed at the same time as the greatest document to insure human freedom,
the United States Constitution. The two have been at cross purposes ever since. The
creation of the United States was largely the work of the true Freemason Lodges.
The organizers of the American Revolution and signers of the U.S. Constitution, were
primarily members of Freemason Lodges. While on the other hand, the disastrous
French and Russian Revolutions with their following reigns of terror and worsening of
the human condition, were largely the work of the "Illuminised" Freemason Lodges of
continental Europe which were named "Grand Orient Lodges."

Part of the ingenious organization of the Illuminati likely stemmed from Wieshaupt's early training
in a Jesuit Order. It must be remembered that the Jesuits were considered the "Vatican's
secret service" in the continual war of Protestant suppression. It was a militant religious order that
had a long history of murder and intrigue, notable examples being the massacre of the Huguenots
in France and the "Gun Powder Plot" in England. The system of secrecy of the Illuminati was quite
simple: The leader worked directly with two men under him. Each of these two men again worked
with two men and so on. The lower men in this hierarchy knew their immediate superior but not
their superior's superior. Through this chain of command tremendous influence could be wielded
without public awareness of the true source of this influence. To further increase the efficiency of
this secret order, many of the most promising were initiated. These often were persons of

wealthy families, magistrates or the higher degrees of the Freemason Lodges. The initiated were
called "Patriarchs."
Also, a system of spying was developed. "Every person shall be made a spy on another and on all
around him ... he shall attempt to discover their strong side and their weak, their passions, their
prejudices, their connections, and above all, their actions." Adepts, called Insinuates or "Insinuating
Brothers," were required to file reports twice a month to their superiors, "So that the Order may
know which are the people in each town and village that they can look to for support." Other
purposes were served by this system of spying. Personnel files could have established on each
Patriarch which would accurately determine his personality profile. Then, each could be placed
in positions where their talents would be of the greatest service to the Order. The more notable
indiscretions committed by a Patriarch were also recorded for possible blackmail purposes should
the need arise. And, any secret subversion from within the Illuminati Order could be quickly
detected and dealt with.
On July 16, 1782, at the Congress of Wilhelm bad, an alliance between Freemasonry and the
Illuminati was sealed. This pact united about 3 million members of the leading secret societies of
that time.

One order of business at the Congress was to allow Jews to become members. This was at a time
when Jews had few rights and were still being sorely prosecuted in Europe. All that passed at this
meeting will perhaps never be known since all attending were sworn to complete secrecy.
Comte de Vireo, one Freemason present at the Congress, was asked what secrets had transpired. He
replied, "I will not confide them to you. I can only tell you that all this is very much more serious
than you think. The conspiracy which has been woven is so well thought out that it will be, so to
speak, impossible for the Monarchy and the Church to escape from it." Some subversive secrets
started to leak from the Illuminati and by October 11, 1785 the Bavarian Elector ordered a raid on
the home of Wieshaupt's chief assistant, Herr Von Zwack. Many documents were recovered during
this raid which outlined the Illuminates plan for worldwide revolution. The Bavarian Elector
decided to have the papers published as "Original Writings of the Order and Sect of the Illuminati."
These papers were circulated as widely as possible as a warning to the European Monarchies.
Wieshaupt was dismissed from his position as Professor and went into hiding with another
Illuminati member, the Duke of Saxe Gotha. While allowing the lie that the Illuminati had been
dissolved to be believed, the secret Order continued its work in secrecy under organizations with

other names. Within a year, the "German Union" surfaced, passing Illuminati propaganda on to the
many "Reading Societies" then in existence. Here the slogan "Liberty, Equality, Fraternity"
was born. The Monarchs of Europe were heedless of the danger and soon the French Revolution
and the "Reign of Terror" were to follow.
The secret history of the Illuminati claims that Wieshaupt foresaw the French Revolution and
wanted to push it on to even greater ends. He is said to be the founder of the first
"Communist International."

Furthermore, the House of Rothschild was the treasurer of the

first Commenter. As we shall see, the unlikely alliance between Capitalist and Communist is a
standard modus operandi of the Illuminatin.
In 1830, Wieshaupt died at the age of 82. In 1834, Giuseppe Mazzini was appointed as director of
the Illuminati. He held this position until his death in 1872. One branch of the Illuminati at that
time, known as "The League of the Just" hired Moses Mordecai Marx Levi (alias Karl Marx) to
write for them. While Giuseppe Mazzini was the head of the Illuminati in Europe, he corresponded

with Albert Pike, the Sovereign Grand Commander of the Ancient and Accepted Scottish Rite
of Freemasonry of the Southern Jurisdiction U.S.A.
A letter dated August 15, 1871, Pike gives Mazzini a detailed plan for World conquest in
three World Wars: The first war would destroy Czarist Russia and place that vast territory under the
control of the Illuminati. The second war would be manipulated by the differences between the
Political Zionists and the German Nationalists. This would lead to the expansion of Russian power
and the creation of a state of Israel in Palestine. The third war would stir up the differences between
the State of Israel and the Arab Muslims. If you were extremely clever and worldly wise and you
wished to invade another country and gain control of that Nation's wealth, what would be the most
effective way to accomplish that end?
A military invasion is too crude. In the first place, the country may be largely destroyed and
its wealth generating productivity severely impaired. In the second place, an occupation army
would be expensive to maintain and would spend most of its time fighting national patriot
guerrilla armies. This continual fighting would further diminish the wealth generating ability of the
conquered Nation. The military approach would be like killing the goose that laid the golden egg.
The best invasion is one that no one is aware has taken place! If you could quietly infiltrate your
agents into the target country and place them in positions to tap that country's wealth unbeknown to
that country's citizens, you could carry out a gigantic hold up without firing a shot. Of course you

probably couldn't get away with it for long without being discovered unless you could also gain
control of that country's news media sources. As you continued in your grand deception and
larceny you would probably consider it expedient to gradually gain control of that country's other
governing agencies like the military and the civilian government. And, that task would be made
easier by the vast sums of money that you siphoned from the target country's national coffers.

The founder of the Banking House of Rothschild stated: "Give me the power to control the issue of
a nation's currency and I care not who makes that nation's laws." The International Banking House
of Rothschild had already gained controlling influence over France and England by the early 1800's
and was extending its influence into the newly independent United States through their agents,
notably Alexander Hamilton from New York.
New York was originally called "New Amsterdam" and was largely a settlement of Colonists
from Holland. Some of these settlers were related to the Money lenders of Amsterdam. The first
Illuminati stronghold in the United States was in New York with the inauguration of the
Columbian Lodge! Benjamin Franklin understood the dangers of a privately owned Central Bank
controlling the issue of the Nation's currency and resisted the charter of a central bank until
his death. Then Hamilton prevailed and the First Bank of America was chartered for a 20year period. In this 20-year period, the Central Bank caused financial havoc through its policies of
creating cycles of inflation and tight money. During times of inflation, the economy would boom.
There would be high employment, and people would borrow money to buy houses and farms. Then
tight money would cause a depression and unemployment. People who could not pay their
mortgages would have their homes and farms repossessed by the bank for a fraction of their
true value. These policies caused the banks to profit greatly at the expense of the people. For these
reasons, the Charter for the First Bank of America was not renewed. This angered the Rothschilds
who used their influence in the British Parliament to attempt to retake the Colonies in the War
of 1812.
The first military attempt failed. The second strategy was to divide and conquer. The serious
historian will find that the Civil War was largely stirred up by Rothschild's Illuminati agents in the
United States.

One of these prominent Illuminati Orders was the secret "Order of Skull & Bones," Chapter 322,
founded at Yale University in 1833 by William Huntington Russell and Alphonso Taft. The "Order"
was incorporated as the "Russell Trust" in 1856.

William Russel became a member of the Connecticut State Legislature in 1846 and a General
in Connecticut

National Guard

in 1862.

Alphonso Taft

became

Secretary of War

in

the

Grant Administration in 1876, U.S. Attorney General in 1876 and U.S. Ambassador to Russia
in 1884. Alphonso Taft's son later became Chief Justice and United States President.
One researcher claims that this secret Order originated in Germany about the time the
Bavarian Illuminati was outlawed in 1786 by the Bavarian Elector. William Russell brought the
secret Order to Yale from his student days in Germany in 1831 to 1832. As an ancient tradition, the
gravestones of Master Masons would have a skull and crossbones engraved on them. The name of
this secret society probably is derived from this tradition. Yale is the only University with societies
open exclusively to seniors. Only 15 Junior Class members are selected to be initiated during
commencement week each year. The candidates are always male white Protestant and usually from
wealthy and powerful families, often their fathers were also members of the Order. During the
Senior Year, members are called "Knights," then they become "Patriarchs" for life.
A number of "Skull and Bones" Patriarchs were to become leaders in the Secessionist movements
of various Southern States. Thus, setting the stage for events leading up to the Civil War. The
Rothschild Banks loaned money to both sides during the war. This strategy greatly weakened our
Nation, but failed with the Union victory.
After the civil war, the cleverer method was used to take over the United States. The Rothschilds
financed

August Belmont,

Kuhn Loeb

and

the

Morgan Banks.

Then they

financed

the Harrimans (Railroads), Carnegie (Steel) and other industrial Titans. Agents like Paul Warburg,
Jacob Schiff, Bernard Baruch were then sent to the United States to effect the next phase of
the takeover.
At the end of the 19th Century, Czarist Russia was the last roadblock to total Global control.
England ruled most of the World. The Rothschilds had controlling influence in England, U.S.,
France, Germany, Austria, and Italy.

Jacob Schiff, president of Kuhn Loeb Bank in New York was appointed by B'nai B'rith (A secret
Jewish Masonic Order meaning "Bothers of the Convenient") to be the Revolutionary Leader of
the Revolution in Russia. On January 13, 1917, Leon Trotsky arrived in the United States and
received a U.S. Passport. He was frequently seen entering the palatial residence of Jacob Schiff.
At these meetings, the Zionist organized agitations of 1905 in Russia were discussed as well as the
lessons to be learned from their earlier failure to overthrow the Czar. Jacob Schiff financed the
training of Trotsky's Rebel Band, comprised mainly of Jews from New York's East Side,
on Rockefeller's Standard Oil Company property in New Jersey. When sufficiently trained in the
techniques of guerrilla warfare and terror, Trotsky's rebel band departed with twenty million dollars
worth of gold, also provided by Jacob Schiff, on the ship S.S. Kristianiafjord bound for Russia to
wage the Bolshevik revolution.
After the Bolshevik Revolution, Standard Oil of New Jersey brought 50% of the huge
Caucasus oil field even though the property had theoretically been nationalized.

In 1927,

Standard Oil of New York built a refinery in Russia. Then Standard Oil concluded a deal to market
Soviet Oil in Europe and floated a loan of $75 million to the Bolsheviks. Jacob Schiff and
Paul Warburg at the Kuhn Loeb Bank started a campaign for a central bank in the United States.
They then helped the Rothschild's to manipulate the financial Panic of 1907. Then, the panic
of 1907 was used as an argument for having a central bank to prevent such occurrences.
Paul Warburg told the Banking and Currency Committee: "In the Panic of 1907, the first suggestion
I made was 'Let us have a national clearing house'."
The "Federal Reserve Act" was the brainchild of Baron Alfred Rothschild of London. The final
version of the Act was decided on at a secret meeting at Jekyll Island Georgia, owned by
J.P. Morgan. Present at the meeting were: A. Piatt Andrew, Assistant Secretary of the Treasury,
Senator Nelson Aldrich, Frank Vanderlin, President of Kuhn Loeb and Co., Henry Davidson,
Senior Partner of J.P. Morgan Bank, Charles Norton, President of Morgan's First National

Of

New York, Paul Warburg, Partner in Kuhn Loeb and Co., and Benjamin Strong, President of
Morgan's Bankers Trust Co. The "Federal Reserve Act" of 1913 was the determining act of the
international financiers in consolidating financial power in the United States. Pierre Jay, initiated

into the "Order of Skull and Bones" in 1892, became the first Chairman of the New York
Federal Reserve Bank. A dozen members of the Federal Reserve can be linked to the same "Order."
The "16th Amendment" allowing Congress to tax personal income quickly followed the
"Federal Reserve Act" (but it never has been ratified in all states.). This was a natural consequence,

since the U.S. government could no longer create its own money to finance its operations as
provided by the Constitution. For the first time in U.S. history, the people thought they had to pay
income tax. (In fact, filing with the IRS is purely voluntary.). Congressman Charles Lindbergh
described the newly created Federal Reserve Bank as "the invisible government by the
money power."

On November 2, 1917 in England, Lord Author James Balfour wrote a significant letter to an
international banker that had been elevated to the level of a peer of the realm, Lord Rothschild:
"Dear Lord Rothschild,
"I have much pleasure in conveying to you in behalf of His Majesty's Government the following
declaration of sympathy with Jewish Zionist aspirations, which has been submitted to and approved
by the cabinet. "His Majesty's Government view with favour the establishment in Palestine of a
national home for the Jewish people, and will use their best endeavours to facilitate the achievement
of this object, it being clearly understood that nothing shall be done which may prejudice the civil
and religious rights of existing non-Jewish communities in Palestine or the rights and political status
enjoyed by Jews in any other Country. "I should be grateful if you would bring this Declaration to
the knowledge of the Zionist Federation.
"Yours Sincerely,
"Arthur James Balfour"

At the time of this letter, Turkey still held Palestine. But nevertheless, one Nation was promising
land held by another Nation to the people of a third!
"Balfour Declaration" that created modern Israel.

This became known as the

A few years later, Turkey was defeated

and England gained control of Egypt and Palestine while France gained control of Lebanon
and Syria.
Lord Rothschild's part of the bargain was to use his influence in the United States to get her
involved in the World War I on the side of the Allies. This at a time when the Allies were doing
very poorly in the war against Germany and Turkey.

The Zionist headquarters in Berlin was moved to New York under the leadership of
Justice Louis D. Brandeis. The "Zionist Transfer Department" was used to finance the Zionist cause
wherever needed. Other significant agents for the Rothschild Bank were Edward M. House and
Bernard Baruch. Bernard Baruch was instrumental in Woodrow Wilson's successful presidential
campaign. Colonial Edward M. House became President Wilson's closest advisor, selecting the
President's Cabinet and virtually running the State Department. There is little doubt that, under the
influence of Colonial House, Woodrow Wilson became an invaluable puppet to the Rothschilds in
not vetoing the "Federal Reserve Act" and asking Congress for a "Declaration of War"
against Germany.
During 1916, Colonial Edward M. House used his considerable influence with the financial
institutions

(many which

held

stock

in

the

Federal Reserve Bank) represented

by Felix

and Paul Warburg, Otto H. Kahn, Louis Marburg, Henry Morgenthau, Herbert Lehman, Mortimer,
and Jacob Schiff to convince Americans that it was their sacred duty to make the "World safe
for democracy." Soon thereafter, the U.S. entered World War I. The Illuminati sold Wilson to the
American people under the slogan that he represented "the New Freedom." "The War to End
all Wars" ended up being very profitable to the Illuminati Bankers and their Associates. Bernard
Baruch, who was placed as Chairman of the War Industries Board, went from a being worth about
one million dollars before the war to being worth about two hundred million after the war.
Bernard Baruch created what was later called the "U.S. Military Industrial Complex." Acting again
on the influence of Colonial House; on January 8, 1918, Woodrow Wilson addressed Congress and
asked for the formation of the "League of Nations," one further step towards the Illuminati goal
of World Government. While at the "Paris Peace Conference" of 1919, 'House' called together the
dedicated intellectuals of Wilson's "Brain Trust" which he had innovated, including John
and Allen Dulles,

Christian A. Herter,

and Tasker H. Bliss

to

form

group

to

study

international affairs. This study group returned to New York from Paris and formed the "Council on

Foreign Relations." The British counterpart is the "Royal Institute for International Affairs"
(RIIA). The RIIA and CFR Policies are now coordinated by the secret Bilderberger Group which
was created in 1954. Prince Ferdinand of the Netherlands was the original Chairman of the
secret Bilderberger Group which largely decides the fate of the World in their secret meetings.

On February 6, 1929; Montagu Morgan, head of the Bank of England, came to Washington to
confer with U.S. Secretary of the Treasury, Andrew Mellon. Next, the "Fed" raised the Prime
Interest Rate. On March 9, Paul Warburg was quoted in "Financial Chronicle" as saying "If orgies
of unrestricted speculation are permitted to spread too far ... the ultimate collapse is certain." Those
in the know, quietly got out of stock and invested in Gold and Silver. Then when everything was
ready, the New York financiers started calling 24-hour broker call loans. Investors had to dump
their stock on the market to pay the loans and this naturally caused a collapse of the market.
The Illuminati controlled banks had now set into motion a series of events that would eventually
bring on World War II. The desperation caused by the great depression could be manipulated by
the Illuminati

to

drastically

alter

the Constitutional

government

of

the

United States.

"New Deal Policies" were a drastic change from the past. Many distressed properties were brought
up for pennies on the dollar by International Banker insiders. The "Council on Foreign Relations"
created by Mundell House was increasing its influence in the United States, gradually recruiting
powerful government leaders, managers of the press, military, and industrial leaders into
its membership. Averell and his brother, Roland Harriman (initiated into the "order of
Skull and Bones" in 1917) financially assisted the Nazis.

This financing was through the

Union Bank in which they, with other members of the "Order," E.S. James and Knight Woolly, had
major holdings.
After financial crash of 1931, German industry was on the brink of bankruptcy. Fritz Tyson,
the German steel baron, openly joined the Nazi Party and threw his financial support behind Hitler.
The flow of funds went through the Bank Door Handel, which controlled the Union Bank
in New York. The Union Bank was a joint Tyson-Harriman operation. A look at the Directors
in 1932 show that of the 8 Directors, 4 were members of the "Order" and 2 were members of the
Nazi Party.
Harriman also funnelled financing to both the Soviets and the Nazis through the Brown Bros.,
Harriman Bank.

One of his close associates was Prescott Bush, father of U.S. President,

George Bush. Both Prescott and George Bush are members of "Skull and Bones."

By 1936,

more

than

100 United States Company's,

including General Motors,

Ford,

International Harvester, and Du Pont had subsidiaries in Germany or cooperative agreements with
that country, helping to build Germany's war machine. However, the motive was other than profit
since the companies were not allowed to take any money outside of Germany. Member of the
"Council on Foreign Relations" and Freemason Grand Master, Franklin Delano Roosevelt had
powerful connections, including Bernard Baruch and Mandel House, which led to his presidency.
After 1936, FDR placed into effect "Pacific Trade Policies" with Japan that forced Japan to choose
between capitulation or war. For her economic survival, Japan chose war.

World War II was

guaranteed by the Terms of the "Treaty of Versailles" which dictated the terms of surrender
of Germany following World War I. This Treaty kept the German people at a near starvation level
as most of their production was used to pay war reparation payments to the Victors. It was the
extreme desperation of the German people that allowed a demagogue like Hitler and his Nazi Party
to raise up in power. The Second World War was deemed a necessary part of Illuminati strategy
which was expressed by the political scientist, Hegel: "To synthesize a new order, it is first
necessary to create opposites sides and then bring them into conflict."

This is why

Illuminati bankers financed both the Soviets and the Nazis. In fact, the Illuminati really favour
neither Capitalism, Communism, or Nazism. Their purpose is to create opposite forces and bring
them into conflict. The modern World is a result of the drastic changes wrought by World War II.
I.G. Fabre Co. had discovered a method of recovering petroleum from Coal and had entered into
a licensing agreement with Standard Oil on the process, receiving 546,000 shares of
Standard Oil Stock, worth about Thirty Million Dollars. I.G. Fabre also entered into an agreement
with Alcoa Aluminium.
The I.G. Fabre Cartel produced about half of Germany's petroleum. Paul Warburg's brother,
Max Warburg sat on I.G. Fabres Board of Directors. Later, I.G. Fabre Co. located plants outside
the Concentration Camps and used the prisoners for slave labour while supplying the gas for the
gas chambers.
One question often asked is: "why would the Rothschilds help to finance the Nazis, the mortal
enemy of the Jews?" The answer to that question is perhaps given by Rabbi Emanuel Rabinovich in
a speech

at

the

"Emergency Council

of

European Rabbis"

in Budapest, Hungary

on January 12, 1952:

"Greetings my children: You have been called here to recapitulate the principal steps of our
new program. As you know, we had hoped to have 20 years between the wars to consolidate the
great gains that we made from World War II ... We may have to repeat the Grim days of

World War II when we were forced to let the Hitlerite Bands sacrifice some of our people ...
The death of a few thousand Jews in exchange for world leadership is indeed a small price to pay ...
To convince you of the certainty of that leadership, let me point out to you how we have turned all
the inventions of the white man against him. His printing presses and radios are mouthpieces of our
desires. And his heavy industry manufactures the instruments which he sends out to Asia and
Africa against him ... And so with the vision of world victory before you, go back to your countries
and intensify your good work, until that approaching day when Israel will reveal herself in all her
glorious destiny as the Light of the World." This speech gave added verification of the
Illuminates long range goals as outlined in the letter between Illuminati leaders Mazzini
and Albert Pike in 1871 and the methods described in the "Protocols." Poland was to be divided up
between Germany and the Soviet Union according to a predetermined agreement between Hitler
and Stalin. Germany attacked first and occupied the agreed upon section. Then Russia invaded and
occupied her agreed upon section. England was required by the "Versailles Treaty" to declare war
against Germany after this move. However, the horrors of World War I were still fresh in the minds
of most Europeans. No one wanted to fire the first shot between England and Germany. For this
reason, England's Prime Minister Chamber land was called an "appeaser." It is certain that Hitler
did not want war with England. In 1933, he pointed out that Communism, in order to reach its final
objective, would eventually destroy Britain's Empire. In that event he stated: "I would be willing to
help defend the British Empire by force if called upon."
Winston Churchill was a good acquaintance of Bernard Baruch, the man who helped
Woodrow Wilson become President and who profited so handsomely by the U.S. entry into
World War I. In one letter, Churchill wrote to Mr. Baruch: "War is coming very soon. You will be
running to show over there, but I will be on the side-lines over here." Bernard Baruch convinced
Winston Churchill, who had been relegated to the political backwaters because of his views
on Palestine, to change his Policy toward support of the Zionist cause.

After reversing his previous stance in a speech to the House of Commons, Mr. Churchill became
Prime Minister in a few short months. The "Phony War" suddenly turned hot as the new
Prime Minister of England ordered air bombings of civilian population centres in Germany
forcing Hitler to retaliate. The majority of Americans did not want to get involved in another
European war. But the Illuminati had other plans. They had already installed their man,
Franklin D. Roosevelt in to the highest office of the land. Roosevelt soon repaid the favours owed
those who placed him in office. Roosevelt issued an unconstitutional Presidential Executive Order

that all privately held gold be turned in to the Banks before the end of April 1933 under
maximum penalty

of $10,000

or 10 years

in prison

or both!

The

gold

was

turned

in

at $20.67 per Oz. After the majority of the gold was turned in, the gold price was fixed
at $35 per Oz. Insiders merely held their gold in foreign banks and later, sold it back at the
higher price! Publicly, FDR stated to the American people: "Your boys are not going to be sent into
any foreign wars." There is a good body of evidence that Roosevelt repeatedly deceived the
American public in the period preceding Pearl Harbour. The fact is that FDR would not have been
re-elected on a war platform in 1940. Top government officials in Washington D.C. had plenty
advanced warning of the attack on Pearl Harbour. On January 27, 1941; U.S. Ambassador
to Tokyo, Joseph Grew wrote a letter to FDR's State Department warning "That in the event of
trouble breaking out between the U.S. and Japan, the Japanese intended in making an attack against
Pearl Harbour."

By August

of 1941,

Congressman Dies

personally

submitted

evidence

of Japan's planned attack on Pearl Harbour, including a strategic map prepared by the
Japanese Imperial Military Intelligence Department to Roosevelt. So, the attack was no surprise
to Roosevelt. Dies was told not to release this information to the public!
On November 26, 1941; FDR sent a war ultimatum to Japan: "Withdraw all troops from Indo China
and Manchuria - or else." Most Asian experts agree that this ultimatum allowed Japan no choice
but to attack the U.S. Naval fleet at Pearl Harbour. The Japanese Ambassador to the U.S.,
Prince Konoye tried to seek other alternatives to war with the U.S., but FDR continually refused to
speak with the Ambassador because war with Japan was already planned. FDR had already given
approval

to

General Chennault

to

launch

air attacks

against Japan

from China

with

the "Flying Tigers.

The Japanese "Purple Code" had been broken with deciphering machines which where were
supplied to all important commanders except at Pearl Harbour. By the early morning of Dec. 7,
Japanese messages indicating that the attack was impending were decoded and forwarded
to Washington D.C.

On Dec. 7,

at 9:30 AM EST,

Admiral Stark

met

with

General George C. Marshall at the Navy Department. Stark wanted to radio Admiral Kimmel at
Pearl Harbour. Marshall said he was afraid that the Japs would intercept the message and
complicate matters. Marshall said that he would personally wire a message to Kimmel.
Marshall finally sent a telegram to Kimmel warning of the Japanese attack. But, it was delayed
sufficiently to arrive after the attack was over. The American Forces at Pearl Harbour were not
prepared for the attack. Ammunition for the anti-aircraft guns was stored in warehouses, not beside

the guns where it was needed for immediate response. Aircraft were parked in circles with their
propellers facing inward. Since the planes had to be pushed backwards by hand to get out of this
position and airborne they were "sitting ducks" for the Japanese aircraft. It was reported
that Roosevelt had ordered the planes grouped in this fashion because he feared sabotage to
the planes. After the U.S was attacked at Pearl Harbour, our main war effort was directed
towards Europe. By 1943, the tide of war had changed to the Allies favour. North Africa had been
secured. Sicily and Italy had been invaded. Then, the Allied advance paused as preparations for the
invasion of France were being prepared. Another figure making tremendous strides in his carrier
was Dwight D. Eisenhower. In March 1941, he was promoted from a Lt. Colonel to a full Colonel.
Three months later, he was promoted to Chief of Staff of the U.S. Third Army.

In another

three months, he became a Brigadier General, proving once again that it is not what you know but who you know that really counts. Eisenhower was a friend of Bernard Baruch!
By December 1941, he was called to Washington by General Marshall and brought into
war planning at the highest level. Following this, Eisenhower enjoyed a series of promotions until
on December 24, 1942, he was made Supreme Allied Commander of Europe.
After Germany's army was pushed out of Rome by the Allied advance, General Mark Clark stated:
"After the fall of Rome, Kesselrings army could have been destroyed - if we had been allowed

to shoot the works in a final offensive." The Allies could have then easily advance across
the Adriatic into Yugoslavia and then into Vienna, Budapest, and Prague. But instead,
Mark Clark's army was halted and weakened by removing men to be used in the
Normandy invasion. This strange tactic prolonged the war by at least one year, cost the Allies
the lives of about 100,000 men and drastically changed the political nature of Eastern Europe in the
following decades. To understand why Supreme Allied Commander Eisenhower did this, it is
necessary to consider the "Quebec Conference" of the Allies in 1943. The policy which was
insisted upon by General George C. Marshall, was based on a document called: "Russia's Position."
The document stated that Russia's post-war position in Europe will be a dominate one. Commander
George Earl, former American Minister to Austria from 1935-1939 and to Bulgaria from 19401942, was Roosevelt's personal Navel attach in Istanbul in the spring of 1943. He had been
approached by the head of the German Secret Service, Admiral Wilhelm Canaries with a proposal
for the surrender of Germany.

The German Generals had a more realistic picture of the war

than Hitler and wanted a "Truce" with England and the United States so that they could concentrate
on a defence against the Russians. They also proposed turning Hitler over to the Allies.

Later, the German Ambassador, Frizz Von Paper made a similar proposal to George Earl.
Earl promptly sent a coded message via diplomatic pouch to President Roosevelt. The proposals of
surrender were never answered by the President! obviously, an honourable surrender of Germany
was not part of the plan to create the Soviet "social experiment" by the Illuminati bankers who
influenced President Roosevelt, General Marshall, General Eisenhower, Churchill, and Stalin.
Meanwhile, operation "Lend Lease," to offer U.S. military aid to the Soviets, was in full swing.
Major Racy Jordan was appointed liaison officer with the Soviets. Jordan was amazed to learn that
Russian Colonel Anatoli Kulikov had considerable influence with Roosevelt's aid, Harry Hopkins
Whenever Kulikov couldn't get items the Russians needed, he would call Mr. Hopkins
in Washington and get results! Often, items needed by our own forces in the battlefield were
diverted to Russia. In one incident, Major Jordan inspected a diplomatic pouch headed for Russia,
over the objections of the Russians. Inside, he saw papers describing atomic fission. A list of
materials on the plane included two pounds of uranium. He did not realize the significance of what
he had seen at the time because atomic weapons research was classified top secret!

Major Jordan kept a dairy with detailed notes of all that he observed of the Lend Lease operations.
Later, he wrote a book, "From Major Jordon's Diaries," describing many little known aspects of
Lend Lease. Not only were the Germans not allowed to surrender, neither were the Japanese, at
least not at first! They issued a formal unconditional surrender in March 1945. Their offer
was ignored! The firebombing of Tokyo proceeded next, destroying sixteen square miles of Tokyo
and leaving millions homeless. Then came the use of the atomic bombs against Nagasaki
and Hiroshima! The massive rebuilding of Germany and Japan after the war a source of
astronomical profits to the International Bankers.

The Japanese and German people are

excellent workers and managers. But, the International Bankers are the shadowy figures behind the
scenes that provide the true leadership of Japan and Germany and the New World Order.
The "Council on Foreign Relations" (CFR), started to get some real influence. Old national
sovereignties were dissolved while new International Organizations like the CFR's creation, the
United Nations were organized and strengthened. The United Nations took on some post war
governing functions. Later, the CFR and its affiliates like the "Institute of the Pacific Rim" (IPR)
and

"Foreign Policy Association" (FPA)

would

virtually

direct

all U.S. foreign policy.

Notably, the IPR is credited with handing over China to the Communists under the guidance
of General George C. Marshall and later, formulating our Vietnam War Policy. The CFR helped
considerably to create the Soviet Empire.

The Illuminates control over the Soviet Union was strengthened by the war. Lend Lease and the
secret agreements at Yalta between Roosevelt, Churchill, and Stalin also strengthened the
Soviet Empire. The ensuing and well-engineered "Cold War" between the Soviet empire and
the West strengthened the Illuminates position in the rest of the World. The hot wars like Korea
and Vietnam were engineered so as not to actually bring the U.S. and Soviets into conflict while
providing justification for the existence of "national security" secret Agencies like the CIA, NSA,
and NSC. The covert operations arm of the CIA was used extensively since the 1950's to subvert
non-aligned governments not already controlled. Then military strongmen were placed in power
that would adopt policies that were favourable to the multinational Corporations directed by
the Illuminati.

In one incident, U.S. President, John F. Kennedy, not willing "to be a good team player,"
was preparing to withdraw U.S. "Advisors" from Vietnam. The withdrawal Order was issued
in October of 1963. He was assassinated in November and as soon as his successor was sworn in,
a massive escalation of the war developed. Investigative attorney, Mark Lane developed Court
evidence that CIA Paymaster, E. Howard Hunt met with Jack Ruby and later paid CIA hit men in
a Dallas Motel

the

evening

before

the assassination.

This is

described

in Lane's book

"Plausible Denial." This shows a connection between the International Bankers and the CIA and
the Mafia. Woe unto anyone who gets in the way of their plans! New international financial
institutions like the "International Monetary Fund" (IMF) the "World Bank" and the "Bank of
International Settlements" were crated to extend economic hegemony through the Planet. The
outrageous national membership fees of the IMF run into billions of dollars per year, per Nation.
When Nations have problems repaying their loans, strict austerity programs are imposed which
cause considerable hardship on the poorer citizens of that Nation.
In 1986; for example, Brazil stripped her rain forests, mined her gold, forced low cost labour onto
her people and had a $10 billion trade surplus. This was the year that the U.S. suffered a $50 billion
trade deficit. But, the interest payment on Brazil's foreign loans also came to $10 Billion, so it was
all for nothing! When Brazil decided to default on the payments, her credit rating dropped to zero.
Without short term credit, Brazil was unable to conduct normal international business transactions
and lost even more in trade than the interest payments had amounted to.
Within six months, Brazil had reconsidered her position and started negotiations with the bankers.
A lesser rate of interest was finally agreed upon.

But, Brazil was persuaded to borrow

$13 billion more! The lenders don't really want the debt paid back. The debt gives them leverage
and the debt servicing or interest payments gives the "cash flow." Often, "austerity measures" are

imposed on Nations that have a difficult time repaying their loans. Social programs like health,
education, or basic food subsidies for the people of the Nation are reduced drastically. A recent
epidemic of cholera in Latin America is directly related to these "austerity programs" and the
reduction of health and sanitary programs carried out by the government. These social evils are a
result of ignorance of the true nature of money, it's purpose and its creation. Honourable leaders
of Nations would not borrow until their countrymen were in bondage.

Knowledgably leaders would insure that their Country controlled the currency rather than
International Bankers.

A national law

ought

to

be

passed

forbidding

Congress

from

borrowing money. Also, Congress should Nationalize the Federal Reserve Bank to regain
its Constitutional authority to mint currency then the borrowing would be unnecessary! Money is
nothing more than a way of keeping score. It has no more intrinsic value than notches on a stick or
binary on off state in a computer memory bank. The productivity of a people is where true wealth
lies. Money keeps track of that productivity and allows the facile transfer of that productivity. The
central banks that print currency and lend it at interest is the prime culprit. This money that was
created from nothing is lent out. But at a later time, the Central Bankers end up owning the entire
productivity of Nations. There can be little doubt that foreign debt is the way the
International Bankers drain the wealth from Nations or that the IMF is the greatest legalized racket
on the Planet. A different means of keeping score is clearly need

BENEFITS OF INTERNATIONL BANKING

There are many benefits to opening an international bank account, in particular if you travel or work
abroad and want to be able to manage your money in different currencies. We have pulled together a
list of the top five reasons we believe are key to opening an international account and how they are
beneficial to you: By having an account in a different currency or country you can react to currency
fluctuations to ensure your money is kept secure and continues to grow in a central location. The
ability to make payments in multiple currencies provides an easy way for you to pay bills overseas,

giving you greater flexibility when it comes to your financial arrangements. The location of where
your international account is held is often in a well regulated low tax jurisdiction. This may mean
you have the option to manage your money in a secure and more tax efficient way. Most
international banking options allow 24/ 7 worldwide access to your money, which lets you stay in
control of your finances wherever you are in the world. By having one central bank account, as
opposed to several accounts for each currency, you can take care of your finances in a simple and
convenient way, which means less stress and worry for you, and more time to enjoy your
international lifestyle.

Multi-currency

Available in Sterling, US Dollar, Euro and Australian Dollar.

Internet Banking

Make payments in a range of currencies or check your balance with fast and secure 24/7
online banking. Discounted international payment fees apply.

Visa debit card

No annual fee.
Pay for goods and services online, at retail outlets or access your cash at ATMs worldwide.
Dedicated 24/7 customer services

Account services

Unlimited deposits and withdrawals.


Standing orders on all currency accounts and direct debits for accounts denominated in
Sterling.
Access to savings accounts and foreign exchange.

Balance criteria
No monthly charges or relationship balance fees.

No account maintenance fee if a minimum average quarterly balance of 250 | US$250 |


250 | AU$250, as applicable.

There are many advantages to opening an international bank account with Standard Bank
Safe and secure global access to your money 24/7.
Quick and easy transfers in multiple currencies gives you greater flexibility over your
finances.
Simple and convenient to operate and offers one central location for all your banking
requirements.
Unlimited access to foreign exchange.
Provides security against exchange rate fluctuations.

Grow and protect your money in a stable offshore jurisdiction on the Isle of Man.
Confidential service wherever you are in the world.

Managing wealth internationally offers a wide range of advantages. Your client advisor will
be happy to explain how you can benefit from UBS's global network and international
banking solutions.

Banking in different markets

Multi-currency and multi-asset capabilities

Enhanced range of asset-classes

International diversification of your portfolio

Comprehensive expertise and execution capabilities provided by a single bank with a global
network

Access to client advisors in other countries

Safe and secure global access to your money

Unlimited access to foreign exchange

Provides security against exchange rate fluctuations

Grow and protect your money in a stable offshore jurisdiction on the Isle of Man

Confidential service wherever you are in the world

Working of international banking

An international bank is a financial entity that offers financial services, such as payment accounts
and lending opportunities, to foreign clients. These foreign clients can be individuals and
companies, though every international bank has its own policies outlining with whom they do
business.

FUNCTIONS OF INTERNATIONAL BANKING


International banks transcend the functions of a domestic bank because they link savers and
borrowers across different countries. Consequently, an international bank helps people and
businesses engage in international trade and finance. Furthermore, an international bank helps with
foreign-currency exchange rates and holds inventories of foreign currencies. For example,HP
Corporation enters into a contract with a firm in Hong Kong to buy memory chips. HP goes to an
international bank, where the bank grants a short-term loan for the memory chip purchase. Bank
helps HP pay for the memory chips and can help HP with the currency exchange rates.
International banks provide three benefits. First, international banks accept deposits from savers and
lend to borrowers, and the savers and borrowers are located in different countries. Second,
international banks lower transaction costs by reducing information costs, lowering the risk of
investments, and increasing the liquidity of financial markets. Liquidity is the ease of converting
assets to currency. Currencies and bank accounts are the most liquid, while housesand cars are the
least liquid assets. Finally, international banks stimulate financial innovation by creating new
financial instruments.
International banks link savers and borrowers from different countries across the world, crossing
international borders. International banks are concentrated in financial centers across the world,
such as New York City, Tokyo, and London, and they operate 24 hours every day,seven days a
week. Consequently, a government in one country has problems regulating its bank's activities in
other countries. For example, Citibank has branches and subsidiaries in many countries around the
world. The U.S. government and Federal Reserve System have trouble regulating and monitoring
all the bank's activities.
International banks are also located in offshore markets. An offshore market has little regulations,
low tax rates, and strict banker-customer confidentiality laws. Leading offshore markets include the
Bahamas, Cayman Islands, Dubai, Hong Kong, and Singapore. If the regulatory agency believes a
bank is participating in risky investments, the regulatory agency has difficulty examining bank
records for subsidiaries located in offshore markets. Consequently, some wealthy people,
businessmen, and criminals hide their money in offshore accounts to evade taxes, to protect their
wealth from countries with aggressive tax policies, or to hide their profits from illegal business
activities

RBI GAUIDLINES

The framework for setting up of WOS has now been finalized by RBI which
favors a subsidiary mode of presence from financial stability perspective. It
provides incentives in the form of Near National Treatment to WOS of foreign
banks which will enable them to open branches anywhere in the country at par
with Indian banks