John Pierpont Morgan was born in 1837, during the first money panic in the United States. Significantly, it had been caused by the House of Rothschild, with whom Morgan was later to become associated.
...Henry Clews, the famous banker, in his book, Twenty-eight Years in Wall Street, states that the Panic of 1837 was engineered because the charter of the Second Bank of the United States had run out in 1836. Not only did President Jackson promptly withdraw government funds
from the Second Bank of the United States, but he deposited these funds, $10 million, in state banks. The immediate result, Clews tells us, is that the country began to enjoy great prosperity. This sudden flow of cash caused an immediate expansion of the national economy, and the government paid off the entire national debt, leaving a surplus of $50 million in the Treasury.
The European financiers had the answer to this situation. Clews further states, "The Panic of 1837 was aggravated by the Bank of England when it in one day threw out all the paper connected with the United States."
The Bank of England, of course, was synonymous with the name of Baron Nathan Mayer Rothschild. Why did the Bank of England in one day "throw out" all paper connected with the United States, that is, refuse to accept or discount any securities, bonds or other financial paper based in the United States? The purpose of this action was to create an immediate financial panic in the United States, cause a complete contraction of credit, halt further issues of stocks and bonds, and ruin those seeking to turn United States securities into cash.
But does Clews actually say this?
I believe not.
Clews writes a whole chapter on the 1837 panic, Chapter XIX Old Time Panics. Clews explicitly states the following:
1. The Second Bank of The United States under Biddle was doing a good job of regulating a stable currency
2. Jackson withdrew government deposits from the Second Bank of the United States and placed these funds in state banks (were these banks run and/or owned by Jackson's friends?)
3. Jackson sold off government land, i.e. privatisation.
4. This combination fuelled a credit bubble and speculation in land which was bought by investors using notes issued by the state banks in which Jackson had deposited the funds removed from the Second Bank of the United States.
5. Jackson was able to clear the government debt from these land sales (but had Biddle done most of the hard work before?)
6. Jackson then issued the Specie Circular which demanded “that all collectors of the public revenue to receive nothing but silver and gold as payment”.
What Clews says is damning of Jackson
The crisis came in 1837, and was hastened by the "Specie Circular," which was the last official act of President Jackson, and which pricked the bubble of inflation.
Apparently public opposition to this circular
was so strong and universal, that a bill went through both houses of Congress partially repealing it."Old Hickory" did not yield to Congress, however, and though he did not veto the bill, he delayed signing it until after Congress adjourned, thus preventing it from becoming a law.
And far from praising Jackson, Clews even appears to criticise Jackson and his VP Martin van Buren. After describing the aftermath of the crisis, with investors losing everything and failures in New York amounting to $100,000,000 Clews mocks
Such were the good old times of financiering when General Jackson and his successor, Martin Van Buren, sat in the Executive chair.
Regarding the influence of The Bank of England on the panic, Clews appears to suggest that the damage had already been done by Jackson when the Bank of England reacted in self defence.
The panic of 1837 was further aggravated by the action of the Bank of England which, in one day, threw out all the paper connected with the United States. The banks on this side refused to discount paper, and as a retaliatory measure in self-defense the business men and speculators withdrew their deposits from the banks.
In other words Mullins is taking liberties in describing the 1837 panic. Clews does not explicitly state that the Bank of England and the Rothschilds engineered the panic because Jackson killed their bank, as is suggested by Mullins in the quote at the top. On the contrary, Clews has a negative view of Jackson's handling of government finance, and blames Jackson's land privatisation, unrestrained credit expansion and Jackson's Specie Circular for the panic, which forced the Bank of England to react. Indeed this would actually suggest that Jackson was a British agent!
And this brings me back to the most excellent report How Andrew Jackson Destroyed the United States by Michael Kirsch in which it is clearly shown that Jackson, despite having fought the British in New Orleans, came under the influence of a nest of Anglophiles around Martin van Buren and was given the task of destroying The Second Bank of The United States because it was financing growth very well. This Jackson did very well.
If you have not done so already you should read Clews' book, Chapter XIX.
This brings into question not only Mullins, but everyone who has used this book as a source. There are several claims that are made that can now be brought into question. For example, was Biddle really an agent of James Rothschild? What is the evidence?
And doesn't this have a familiar ring to it; banks create a credit bubble based on land and property which is then pricked to cause a panic? 1837? Or 2007?
And one last thing. Apparently Jackson placed US government funds in the NM Rothschild bank in London! The source is The Pressure of 1836: The International Origins of the panic in 1837 by Jessica Lepler.
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