The Creation of the Federal Reserve: The Secret Meeting at Jekyll Island

Table of Contents

1. Introduction: The Conspiracy That Isn't One
2. America Before the Fed
3. The Secret Meeting at Jekyll Island
4. The Federal Reserve Act of 1913
5. The Structure of the Federal Reserve
6. Historical Consequences
7. The Titanic Connection?
8. The Fed Today
9. And the ECB?
10. FAQ
11. Conclusion: Understanding Who Controls Money
12. Sources and References

In November 1910, the richest men in America met secretly on a private island. Their mission: to create a central bank they would control. Here is the true story of the Fed's birth.

Introduction: The Conspiracy That Isn't One

Documented facts of a secret meeting that changed the global monetary system.

When we talk about the creation of the Federal Reserve as a "conspiracy," we usually get labeled as conspiracy theorists. Yet the facts are historically documented and recognized by official historians.

In November 1910, six men representing about one quarter of the world's wealth met secretly on Jekyll Island, Georgia, to draft the plan for what would become the Federal Reserve.

They used fictitious first names, traveled in a private railcar, and maintained secrecy for decades. This is not a theory: it's official history, told notably by one of the participants himself in his memoirs.

America Before the Fed

For 77 years, the United States prospered without a central bank.

A Decentralized Banking System

Unlike Europe, 19th century United States had no permanent central bank.

Previous attempts:

• First Bank of the United States (1791-1811): created by Hamilton, not renewed
• Second Bank of the United States (1816-1836): destroyed by Andrew Jackson

President Andrew Jackson considered central banks as instruments of financial tyranny serving the elites.

"The bank is trying to kill me, but I will kill it!"

— Andrew Jackson, 1832 Source: Robert V. Remini, "Andrew Jackson and the Bank War" (1967)

Jackson won this battle. Remarkably: he is the only American president to have completely paid off the national debt (January 8, 1835).

For 77 years (1836-1913), America functioned without a central bank. It was during this period that the country became the world's leading industrial power.

Banking Panics

The system without a central bank wasn't perfect. Banking panics occurred regularly:

• 1873: Panic following Jay Cooke's bankruptcy
• 1893: Railroad panic
• 1907: The "Bankers' Panic"

These crises were used as arguments to create a central bank.

The Panic of 1907: The Perfect Pretext

In October 1907, a series of bank failures triggered a general panic. Depositors rushed to banks to withdraw their money.

The "savior": J.P. Morgan.

Morgan gathered the greatest bankers in his private library and forced them to pool their resources to stabilize the system.

The crisis was resolved, but the message was clear: America needs a lender of last resort. And the big bankers were perfectly positioned to propose a solution... that suited them.

The Secret Meeting at Jekyll Island

Six men controlling a quarter of the world's wealth draft the plan in secret.

November 1910: The Private Island

Jekyll Island was a private island belonging to the Jekyll Island Club, whose members included the Rockefellers, Morgans, Vanderbilts, and Pulitzers.

On November 22, 1910, a group of men met in a private railcar at Hoboken station, New Jersey. Destination: Jekyll Island.

Mission rules:

• Use only first names (no surnames)
• Don't acknowledge each other publicly
• Maintain absolute secrecy

Why such precautions? Because if the public learned that the country's biggest bankers were meeting to draft a banking law, the project would be stillborn.

The Participants

Here are the six men present at Jekyll Island:

A seventh man was present: Abraham Piatt Andrew, assistant Treasury secretary, who served as government liaison.

Paul Warburg: The European Architect

Paul Warburg deserves particular attention. Born in Germany, naturalized American in 1911, he was the expert on European central banks.

His family, the Warburgs, was allied with the Rothschilds through marriage and business. Warburg intimately knew how the German Reichsbank and the Bank of England worked.

He drafted most of the Jekyll Island plan.

"I spent 10 days at Jekyll Island with Mr. Vanderlip and other well-known people, drafting the plan that became the Federal Reserve Act."

— Paul Warburg, testimony before U.S. Congress, 1914 Source: Congressional Record, 63rd Congress, 2nd Session

Frank Vanderlip's Confession

In 1935, Frank Vanderlip published an article in the Saturday Evening Post where he confesses everything:

"I do not feel it is any exaggeration to speak of our secret expedition to Jekyll Island as the occasion of the actual conception of what eventually became the Federal Reserve System... We were as secretive, indeed as furtive, as any conspirators."

— Frank Vanderlip, "From Farm Boy to Financier", Saturday Evening Post, February 9, 1935

This confession is crucial: one of the participants himself uses the word "conspirators" to describe their meeting.

10 Days to Draft the American Monetary System

For 10 days, the six men worked intensively on the plan. Discussions focused on:

1. Structure:

• How many regional banks?
• Who controls them?
• What relationship with government?

2. Money Creation Power:

• How to create money?
• What limits (if any)?

3. Lender of Last Resort:

• How to avoid future panics?
• (Answer: unlimited money creation power)

4. Appearance of Public Control:

• How to get Congress to accept the plan?
• How to present it as a "public" institution?

The resulting plan would be called the "Aldrich Plan", named after the senator who would present it.

The Federal Reserve Act of 1913

Rejected under one name, adopted under another: the legislative sleight of hand.

First Attempt: Failure

The "Aldrich Plan" was presented to Congress in 1911. It was rejected.

Why? Nelson Aldrich's name was too associated with banking interests. The public and Democrats opposed it.

Rebranding: The Communication Operation

The solution? Change the name and packaging, not the content.

The plan was taken over by Democratic representative Carter Glass and became the "Glass-Owen Bill". The bankers played a brilliant double game:

• In public, they criticized the project (to make it seem it didn't suit them)
• Behind the scenes, they supported and funded its adoption

The December 23, 1913 Vote

The Federal Reserve Act was voted:

• House of Representatives: December 22, 1913, 298 for, 60 against
• Senate: December 23, 1913, 43 for, 25 against

Strategic timing: The Senate vote took place two days before Christmas. Many senators had already gone home for the holidays.

President Woodrow Wilson signed the law the evening of December 23.

Wilson's Regret

Years later, Wilson reportedly expressed regrets:

"I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men."

— Attributed to Woodrow Wilson

Note: The exact authenticity of this quote is debated by historians. However, Wilson did express doubts about the power of "financial interests" in his later writings.

The Structure of the Federal Reserve

Neither truly public nor truly private: a unique hybrid creature.

A "Private" Bank with State Monopoly

The Fed is a unique creature: neither completely public nor completely private.

"Public" elements:

• Board of Governors is appointed by the President
• Congress can theoretically modify the law
• "Excess" profits are returned to Treasury

"Private" elements:

• The 12 regional Federal Reserve Banks are owned by member banks
• Member banks receive a guaranteed 6% dividend
• The Fed resists any complete audit of its operations

The 12 Regional Banks

To make the system acceptable, it was presented as "decentralized" with 12 regional banks:

In reality: The Federal Reserve Bank of New York dominates the system. It executes market operations and manages relationships with foreign central banks.

And who was the first president of the New York Fed? Benjamin Strong – one of the six men from Jekyll Island.

Money Creation Power

The Fed's real power is simple: create money out of nothing.

The process:

1. Government needs money
2. Treasury issues bonds (Treasury bills)
3. Fed "buys" these bonds
4. Fed pays with money it creates on a computer screen
5. Government spends this money
6. Government must repay... with interest

The vicious circle: More debt means more money in circulation means more debt to repay.

Historical Consequences

One hundred and ten years later, the dollar has lost 97% of its value.

Before the Fed vs After the Fed

Historical irony: The Fed was created to "avoid banking panics." Yet the worst crisis in history (1929) occurred under its watch.

War Financing

The Fed enabled financing wars otherwise impossible:

• World War I (1917-1918): Fed finances American entry into war
• World War II: Massive financing through money creation
• Korea, Vietnam: Same
• Middle East wars: $8 trillion between 2001 and 2021

Without unlimited money creation power, these wars would have required direct taxes. The public would have refused.

The End of the Gold Standard

The Fed made abandoning the gold standard possible:

• 1933: Roosevelt confiscates citizens' gold
• 1971: Nixon abandons Bretton Woods

These decisions would have been impossible without a central bank capable of creating replacement money.

The Titanic Connection?

Three Fed opponents die in April 1912, a troubling coincidence.

Documented Facts

In April 1912, the Titanic sinks. Among the victims: three of America's richest men.

These three men were indeed opposed to creating a central bank. Their death eliminated significant opposition.

The Theory

Some suggest the sinking wasn't accidental, but a mass murder to eliminate opposition to the Fed.

Arguments advanced:

• J.P. Morgan was supposed to be on board but canceled at the last minute
• White Star Line belonged to Morgan (via IMM Trust)
• Captain Smith allegedly ignored iceberg warnings
• Three major opponents eliminated at once

Critical Analysis

What we know with certainty:

• The three men were indeed on board
• They were indeed rich and influential
• The Fed was voted 20 months after the sinking

What is speculative:

• Was their opposition really decisive?
• Did Morgan know something?
• Was an "attack" of this magnitude technically feasible?

Position of this article: We present the facts. You form your own opinion. Official history speaks of a tragic accident. Some doubt. Definitive proof doesn't exist.

The Fed Today

A balance sheet multiplied by eight in less than twenty years.

The $9 Trillion Balance Sheet

In 2008, the Fed's balance sheet was about $900 billion.

In 2025, it exceeds $7.5 trillion.

Translation: The Fed has created more than $6 trillion in less than 20 years.

Independence: Myth or Reality?

The Fed presents itself as "independent" from political power. In reality:

Political pressures:

• Trump publicly attacked Powell for rate hikes
• Presidents influence Board nominations
• Congress can modify the Fed's mandate

Revolving door:

• Fed leaders often come from Wall Street
• They often return there after their term
• Structural conflicts of interest

Can the Fed Be Audited?

Short answer: Partially.

The Fed undergoes annual financial audits. But monetary policy operations (rate decisions, asset purchases) remain largely opaque.

The "Audit the Fed" movement (supported by Ron Paul) demands a complete audit, including monetary policy decisions and agreements with foreign central banks.

These requests have been systematically rejected.

And the ECB?

Europe copied the model with the same money creation powers.

Same Principle, Different Structure

The European Central Bank (1998) operates on similar principles:

Main difference: The ECB is owned by national central banks (themselves public), not directly by private banks.

But the result is the same: unlimited money creation without real democratic control.

FAQ

Is the Fed Really Private?

It's complex. The Board of Governors is a government agency. But the 12 regional Federal Reserve Banks are private corporations, owned by commercial member banks. These member banks receive a guaranteed 6% dividend. It's a unique public-private hybrid.

Who Are the Fed's Current Owners?

Commercial member banks are the "shareholders" of regional Federal Reserve Banks. The largest: JPMorgan Chase, Bank of America, Citibank, Wells Fargo. These shares cannot be sold on the market and don't give proportional voting power.

Is the Jekyll Island Meeting a Historical Fact?

Yes, absolutely. Frank Vanderlip confirmed it in his memoirs (1935) and in a Saturday Evening Post article (1935). Paul Warburg mentioned it before Congress. It's accepted by official historians, including those of the Federal Reserve itself.

Can the Fed Be Abolished?

Legally, yes. The Congress that created the Fed can abolish it. In practice, it's extremely unlikely. The global financial system is built around the Fed and dollar. Abolition would cause a major short-term crisis. Candidates like Ron Paul proposed this option without success.

What Alternative to the Fed?

Several alternatives have been proposed: return to gold standard, free banking system (competing private banks), local currencies, decentralized cryptocurrencies (Bitcoin). Each option has advantages and disadvantages. Bitcoin is the most developed alternative to date.

Conclusion: Understanding Who Controls Money

The history of the Fed's creation is neither a conspiracy theory nor a trivial fact. It's the story of how control of American money – and by extension global money – was transferred to a restricted group of financial interests.

What we know with certainty:

1. The Fed was designed in secret by private bankers
2. The public was never consulted
3. The system structurally benefits its creators
4. Money creation has been unlimited since 1971
5. Debt and inflation are the direct consequences

The question is not: "Was there a conspiracy?"

The question is: "Does this system serve citizens' interests or those of its architects?"

The history of these 110 years suggests a clear answer.

Related Articles - Monetary Sovereignty

• Mass Manipulations Verifiable Facts
• Financial Censorship Account Freezing
• Money Transfer Bank vs Bitcoin
• Psychology of Money Morgan Housel
• Inflation Invisible Tax Savings Erosion

Sources and References

• G. Edward Griffin: "The Creature from Jekyll Island" (1994)
• Frank Vanderlip: "From Farm Boy to Financier" (memoirs, 1935)
• Saturday Evening Post: Vanderlip article (February 9, 1935)
• Federal Reserve: Official history publications
• Murray Rothbard: "The Case Against the Fed" (1994)
• Ron Paul: "End the Fed" (2009)
• Congressional Record: Federal Reserve Act debates (1913)

Article written in December 2025 | Category: Money, Debt & Financial Sovereignty