People are as (if) State Banks!

[David Merrill]

Recently a suitor received an email response from the Treasury. (She will try to get the Paper rendition.) However, I think somebody may have already posted this Form Letter around here in paper form.

Dear Ms. Sanitized:

Thank you for your most recent correspondence to the Federal Reserve Board concerning Federal Reserve notes and "lawful money."

"Lawful money" is a term used in the Federal Reserve Act, the act that authorizes the Board of Governors of the Federal Reserve System to issue Federal Reserve notes. The Act states that Federal Reserve notes "shall be obligations of the United States and shall be receivable by all national and member banks and Federal reserve banks and for all taxes, customs, and other public dues. They shall be redeemed in lawful money on demand at the Treasury Department of the United States, in the city of Washington, District of Columbia, or at any Federal Reserve bank." The Act did not, however, define the term "lawful money," but up until 1913, the only currency issued by the United States that was legally recognized as "lawful money" was various issues of "demand notes" (subsequently known as "old demand notes") and "United States notes" authorized by Congress during the Civil War.

At the time, some currency was not considered legal tender, although it could be used by national banking associations as "lawful money reserves." Thus, the term "lawful money" had a broader meaning than the term "legal tender."

In 1933, Congress changed the law so that all U.S. coins and currency (including Federal Reserve notes), regardless of when issued, constitutes "legal tender" for all purposes. Federal and state courts since then have repeatedly held that Federal Reserve notes are also "lawful money." Milam v. U.S., 524 F.2d 629 (9th Cir. 1974), is typical of the federal and state court cases holding that Federal Reserve notes are "lawful money." In Milam, the United States Court of Appeals for the Ninth Circuit reviewed a judgment denying relief to an individual who sought to redeem a $50 Federal Reserve Bank Note in "lawful money." The United States tendered Milam $50 in Federal Reserve notes, but Milam refused the notes, asserting that "lawful money" must be gold or silver. The Ninth Circuit, noting that this matter had been put to rest by the U.S. Supreme Court nearly a century before in the Legal Tender Cases (Juilliard v. Greenman), 110 U.S. 421 (1884), rejected this assertion as frivolous and affirmed the judgment.

I hope this information is helpful.

Sincerely,

JPD
Board Staff

The Treasury is putting words into Congress' mouth! Congress may have the authority to establish lawful money, and in fact with US notes did a long time ago. However, this is what Congress says about Federal Reserve notes:

They shall be redeemed in lawful money on demand...

Any way you twist the grammar Federal Reserve notes are not lawful money.

One of the suitors, alsoa member here explained McFADDEN's 1933 testimonials.

So there is either a demand draft on the Treasury of the State understanding [surety] for the central banking agreements [variation of agreement of the worldly states] or one is active in the game as banker acting as agent de-jure in the federal reserve districts. A re-venue since the interest has been DE-posited or abandoned.

Without McFADDEN with his lucid perspective it is difficult to get why this suitor is involving the State Comptroller in the mix. This is the inclusion of the State Banks in the original intent of §16 of the Fed Act that became Title 12 USC §411. And this is why today there is such a lax requirement to be recognized as a State Bank; everybody endorsing private credit from the Fed is a state bank!

Before 1933 the Federal Reserve note was basically a marker for interbank transactions. Watch how McFADDEN recognizes how the FRN's should be transferring to and between the people, just like the State Banks had been doing, but with the State Banks, there was rapid inflation:

For me, I was excited by this explanation because how it describes the diversity of citizenship between those in contract (endorsement) with the Fed and those who demand lawful money. Basically the Oath of Office process with the Secretary of State binds the officials' behaviors through the IN GOD WE TRUST trust through the State Comptroller at the State Treasury, even though this is happening in the Districts. In other words those working in the Federal Reserve Districts, even within the State Districts must publish their oaths with the Secretary of State.