The Rothschild Formula

By the end of the eighteenth century, the House of Rothschild had become one of the most successful financial institutions the world has ever known. Its meteoric rise can be attributed to the great industry and shrewdness of the five brothers who established themselves in various capitals of Europe and forged the world's first international financial network. As pioneers in the practice of lending money to governments, they soon learned that this provided unique opportunities to parlay wealth into political power as well. Before long, most of the princes and kings of Europe had come within their influence.

Rothschild Coat of Arms

The Rothschilds also had mastered the art of smuggling on a grand scale, often with the tacit approval of the governments whose laws they violated. This was perceived by all parties as an unofficial bonus for providing needed funding to those same governments, particularly in time of war. The fact that different branches of the Rothschild network also might be providing funds for the enemy was pragmatically ignored. Thus, a time-honored practice among financiers was born: profiting from both sides.

Enlargement of the Rothschild Crest

The Rothschilds operated a highly efficient intelligence gathering system which provided them with advance knowledge of important events, knowledge which was invaluable for investment decisions. When an exhausted Rothschild courier delivered the first news of the Battle of Waterloo, Nathan Rothschild was able to deceive the London bond traders into a selling panic, and that allowed him to acquire the dominant holding of England's entire debt at but a tiny fraction of its worth.

Lionel Nathan Rothschild was "elected" to
British Parliment in 1847

A study of these and similar events reveals a personality profile, not just of the Rothschilds, but of that special breed of international financiers whose success typically is built upon certain character traits. These include cold objectivity, immunity to patriotism, and indifference to the human condition. That profile is the basis for proposing a theoretical strategy, called the Rothschild Formula, which motivates such men to propel governments into war for the profits they yield. This formula most likely has never been consciously phrased as it appears here, but subconscious motivations and personality traits work together to implement it nevertheless. As long as the mechanism of central banking exists, it will be to such men an irresistible temptation to convert debt into perpetual war and war into perpetual debt.

The Rothschild Formula may be briefly summarized as follows:

1. War is the ultimate discipline to any government. If it can successfully meet the challenge of war, it will survive. If it cannot, it will perish. All else is secondary. The sanctity of its laws, the prosperity of its citizens and the solvency of its treasury will be quickly sacrificed by any government in its primal act of self-survival.
2. All that is necessary, therefore, to insure that a government will maintain or expand its debt is to involve it in war or the threat of war. The greater the threat and the more destructive the war, the greater the need for debt.
3. To involve a country in war or the threat of war, it will be necessary for it to have enemies with credible military might. If such enemies already exist, all the better. If they exist but lack military strength, it will be necessary to provide them the money to build their war machine. If an enemy does not exist at all, then it will be necessary to create one by financing the rise of a hostile regime.
4. The ultimate obstacle is a government which declines to finance its wars through debt. Although this seldom happens, when it does, it will be necessary to encourage internal political opposition, insurrection or revolution to replace that government with one that is more compliant to our will. The assassination of heads of state could play an important role in this process.
5. No nation can be allowed to remain militarily stronger than its adversaries, for that could lead to peace and a reduction of debt. To accomplish this balance of power, it may be necessary to finance both sides of the conflict. Unless one of the combatants is hostile to our interests and therefore, must be destroyed, neither side should be allowed a decisive victory or defeat. While we must always proclaim the virtues of peace, the unspoken objective is perpetual war.
   

For more information on this subject, please consult the excellent book The Creature from Jekyll Island, by G. Edward Griffin.

Masquerade in Moscow

The Bolshevik Revolution was not a spontaneous uprising of the masses. It was planned, financed and orchestrated by outsiders. Some of the financing came from Germany which hoped that internal problems would force Russia out of the war against her. But most of the money and leadership came from financiers in England and the United States. It was a perfect example of the Rothschild Formula in action.

Bolshevik Revolution in Russia, 1917

This group centered mainly around a secret society created by Cecil Rhodes, one of the world's wealthiest men at the time. The purpose of that group was nothing less than world domination and the establishment of a modern feudalist society controlled by the world's central banks. Headquartered in England, the Rhodes inner-most directorate was called the Round Table. In other countries, there were established subordinate structures called Round Table Groups. The Round Table Group in the United States became known as the Council on Foreign Relations. The CFR, which was initially dominated by the Morgan group and later by the Rockefellers, is the most powerful group in America today. It is even more powerful than the federal government, because almost all of the key positions in government are held by its members. In other words, it is the United States Government.

Cecil Rhodes (above) along with Lord
Milner organized the Round Table Group

Agents of these two groups cooperated in pre-revolutionary Russia and particularly after the Czar as overthrown. The American contingent in Russia disguised itself as a Red Cross mission allegedly doing humanitarian work. Cashing in on their close friendship with Trotsky and Lenin, they obtained profitable business concessions from the new government which returned their initial investment many times over.

For more information on this subject, please consult the excellent book The Creature from Jekyll Island, by G. Edward Griffin.

Sink the Lusitania!

To finance the early stages of WWI England and France had borrowed heavily from investors in America and had selected the House of Morgan as sales agent for their bonds. Morgan also acted as their U.S. purchasing agent for war materials, thus profiting from both ends of the cash flow: once when the money was borrowed and again when it was spent. Further profits were derived from production contracts placed with companies within the Morgan orbit.

The House of Morgan profited
from both ends of WWI

But the war began to go badly for the Allies when Germany's submarines took virtual control of the Atlantic shipping lanes. As England and France moved closer to defeat or a negotiated peace on Germany's terms, it became increasingly difficult to sell their bonds. No bonds meant no purchases, and the Morgan cash flow was threatened. Furthermore, if the previously sold bonds should go into default, as they certainly would in the wake of defeat, the Morgan consortium would suffer gigantic losses.

In WWI, German U-Boats upset the
traditional British domination of the seas

The only way to save the British Empire, to restore the value of the bonds, and to sustain the Morgan cash flow was for the United States government to provide the money. But, since neutral nations were prohibited from doing that by treaty, America would have to be brought into the war. A secret agreement to that effect was made between British officials and Colonel House, with the concurrence of the President. From that point forward, Wilson began to pressure Congress for a declaration of war. This was done at the very time he was campaigning for re-election on the slogan "He kept us out of war." Meanwhile, Morgan purchased control over major segments fo the news media and engineered a nation-wide editorial blitz against Germany, calling for war as an act of American partiotism.

Colonel Edward House secretly negotiated to
bring the U.S. into WWI on the side of Britain

Morgan had created an international shipping cartel, including Germany's merchant fleet, which maintained a near monopoly on the high seas. Only the British Cunard Lines remained aloof. The Lusitania was owned by Cunard and operated in competition with Morgan's cartel. The Lusitania was built to military specifications and was registered with the British Admiralty as an armed auxiliary cruiser. She carried passengers as a cover to conceal her real mission, which was to bring contraband war materials from the United States. This fact was known to Wilson and others in his administration, but they did nothing to stop it. When the German embassy tried to publish a warning to American passengers, the State Department intervened and prevented newspapers from printing it. When the Lusitania left New York harbor on her final voyage, she was virtually a floating ammunition depot.

The German warning to Americans not to board the
Lusitania was suppressed by the U.S. State Department

The British knew that to draw the United States into the war would mean the difference between defeat and victory, and anything that could accomplish that was proper -- even the coldly calculated sacrifice of one of her great ships with Englishmen aboard. But the trick was to have Americans on board also in order to create the proper emotional climate in the United States. As the Lusitania moved into hostile waters, where a German U-boat was known to be operating, First Lord of Admirality, Winston Churchill, ordered her destroyer protection to abandon her. This, plus the fact that she had been ordered to travel at reduced speed, made her an easy target. After the impact of one well placed torpedo, a mighty second explosion from within ripped her apart, and the ship that many believed could not be sunk, gurgled to the bottom of the sea in less than 18 minutes.

Winston Churchill ordered the Lusitania's destroyer
escort to abandon her, just as she entered hostile waters

The deed had been done, and it set in motion great waves of revulsion against Germany. These waves eventually flooded through Washington and swept the United States into war. Within days of the declaration, Congress voted $1 billion in credit for England and France. $200 million was sent to England immediately and was applied to the Morgan account. The vast quantity of moeny needed to finance the war was created by the Federal Reserve System, which means it was collected from Americans through that hidden tax called inflation. Within just five years, this tax had taken fully one-half of all they had saved. The infinitely higher cost in American blood was added to the bill.

Thus it was that the separate motives of such diverse personalities as Winston Churchill, J.P. Morgan, Colonel House and Woodrow Wilson all found common cause in bringing America into WWI. Churchill maneuvered for military advantage, Morgan sought the profits of war, House schemed for political power, and Wilson dreamed of a chance to dominate a post-war League of Nations.

For more information on this subject, please consult the excellent book The Creature from Jekyll Island, by G. Edward Griffin.