The Evolution Of US And UK Central Banking: An Infographic

Tyler Durden's picture

Investors once knew: Focusing on assets without understanding monetary matters can get you into trouble. They have since forgotten this. Ironically, then, there’s great value in remembering it. As “Vermont Ruminator”, Humphrey B. Neill, wrote in The Art of Contrary Thinking:

[Money] is a study in itself and one which still confuses the great minds of the world...


...because monetary problems are not comprehended by the public or by the average businessman, “money management” will continually cross up public opinions concerning economic trends...


...If you make it a point to become posted on some of the more common practices of monetary management you will …be able to discern trends that are opposite to those commonly discussed...

This addogram delves into the evolution of the two most prominent reserve currencies of the past 350 years: The pound sterling and the dollar.

It features visualizations of a collection of extremely rare (if not entirely unique) data-sets. The Bank of England’s assets and liabilities since Robert Peel’s Bank Act of 1844 (monthly). And the Federal Reserve System’s assets and liabilities since shortly after its creation (weekly). The yield, equity index and gold price section goes back as far as 1840. This pairing of comprehensive monetary and asset price data gives the addogram an intensely practical feel.


Click chart below for huge version...


Click here for zoomable super hi-res version


Put this on your wall and you’ll soon be operating from a 400-year context of price and monetary history.

Chart courtesy of Addogram

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zorba THE GREEK's picture

Only gold and silver are real money.

Everything else is fiat crap.

flacon's picture

Ever since understanding money (hence economics) I've found it hard to form deep friendships with those who do not understand money. It's like they are living in a dream and I am only interacting with a partial human. 

markmotive's picture

Money, get away
Get a good job with more pay
And your O.K.

Money, it's a gas
Grab that cash with both hands
And make a stash

New car, caviar, four star daydream
Think I'll buy me a football team

Money get back
I'm all right Jack
Keep your hands off my stack

GetZeeGold's picture



Go on.....take the money and run......son. Those cats make their living on other peoples taxes.


The Navigator's picture

"only interacting with a partial human" ........... Zombies, man, they're Zombies who can't read and understand history or math.

flacon's picture

I'm afraid you're right. Keynes called them "Animal spirits" - and I agree, they act on animal instinct with no true understanding. 

old naughty's picture

Money is the currency of love...

To be replaced by gold.

SafelyGraze's picture

the fed got a slow start but then started kicking some serious ass, what with wwi and all that

which brokerages allow you to bet directly on CB balance sheet data? none of that indirect FX crap. just put money on "MBS + POMO > 50B".

oh wait. found it.


Incubus's picture

The same could be said about people who do not understand social systems, in general.

The Will to Ignorance is vital to the functioning of any primitive society.  Egocentricism aside, we are a primitive society in the grand scheme of things.  We refuse to mentally evolve; shackled by the unthinking that see with closed eyes.

We've just gone from mostly believing in religious things to social things. The ordained are those in suits; those who are baptized by fiat.


Partial humans.  You are correct.

It's a shame, really, because the first step to seeing things properly is to toss your need for a cultural-social-identity crutch out the window.

All the world's society is but pretend-play.  The only thing that keeps change from happening is faith in the pseudo-objective social construction of "you" and "I."


socalat_Kruger's's picture

deep, but you can't just take the red pill, you need fiat to live.

chalcedonite's picture

I don't know...  I don't feel so bold about it...  The more I learn the more epistemological self-consciousness I have.  It makes me wonder what is really going on and aware of the fact that I will never fully know.  All we like sheep have gone astray; we have turned every one to his own way; and the LORD hath laid on him the iniquity of us all. Isaiah 53:6

Radical Marijuana's picture


ALL money is fiat, and the only way we agreed upon what "money" will be is through violence resolving our conflicts.

This chart shows the overall exponential growth, from 1970 to now! Both are picking up speed, whereby, both in the USA and in the UK, all the debts of current governments are double all preceding ones! Ideas of going back to old-fashioned notions about money are too little, too late. We are already too deep into global electronic fiat money frauds, backed up by atomic bombs! We only can have gold or silver as "money" after we have an established equilibrium of lies and violence, called the "rule of law." There is no way to avoid the fundamental paradoxes of enforcement regarding that rule of law. Our current monetary system is a state religion, but going backwards to previous versions of those religions are no longer possible.

If one looks at the ancient Greek monetary history, and the early American monetary history, one will see that gold and silver money was backed by laws that would impose the death penalty on fraudulence in that money supply! IT IS ALWAYS THE TRUTH THAT MONEY IS BACKED BY MURDER. That was originally true about gold and silver money, and it is actually what is behind the USA and UK fiat money, since those were backed by the sovereign powers of those government to tax, and to kill those who resisted being taxed. The idea that gold and silver money is better is mistaken. The only better money must be based on better murder.

Ookspay's picture

Money is the tender trap that makes us feel less like slaves.

dark pools of soros's picture

and when we have too much we overspend to feel the cool comfort of our chains again

BigDuke6's picture

PM's are addicted to QE too.

its an uncomfortable fact and i say this as someone long gold big time.

akak's picture

I would tend to agree, yet one then has to ask what was driving the price of gold upward prior to the advent of the QE programs.

Mr Lennon Hendrix's picture

Yeah that's bullshit BigDuke.  Gold bottomed before equities during the Fall of '08 into the Spring of '09.  It does great in deflation.

BigDuke6's picture

It does ok in deflation.

Not great , but it doesn't tank.

Mr LH - if you wanna be another ZH gold 'will never go down' monkey thats cool for you.

But i'll be waiting for the xmas/ny drop as usual to top up.

i'm not buying just now.


LetThemEatRand's picture

PM's are addicted to QE because they are priced in fiat, and fiat buys bread, labor, cars, houses, etc.  If the day ever comes where widely circulated currencies do not buy the necessities without several zeros attached to the end (hard to imagine to any living human outside of a few countries that have experienced massive fiat debasement), the relationship between PM's and fiat (QE is fiat) will be meaningless.  The question is and has been for decades whether the day will come in our lifetimes that fiat loses its purchasing power for the average person to the extent that something else is needed.

BigDuke6's picture


'The question is and has been for decades whether the day will come in our lifetimes that fiat loses its purchasing power for the average person to the extent that something else is needed.'

This is the crux. To go go balls deep into gold while you wait is hairy.

I'm moving house just now and shifting the gold is a pain in the neck.

The can can be kicked along the road for a long time.

i've thought that ZH could help me with knowing how long for but as time goes by i think gut instinct will be more important.

Real Estate Geek's picture

I'm moving house just now and shifting the gold is a pain in the neck.

I wish I had that problem.

GetZeeGold's picture



and fiat buys bread


It don't in Zimbabwe bitch.

mayhem_korner's picture



The relationship of PMs to fiat is already meaningless to those who understand preservation of purchasing power.  That's why those of us who hold PMs never worry about the so-called "price".  The only ones who fret over the "price" of gold are those who are still wed to the notion that fiat-denominated prices will persist indefinitely.

zhandax's picture

Except that how many ounces you can buy a week from Thursday is currently a function of the fiat price.  Some of us, using one or more forms of analysis, may project that the fiat price will be lower two weeks from Thursday and decide to wait to buy.  Embedded in this decision is the assumption that the currency will not collapse this month.  One of these days, that will be a faulty assumption, but look at how many more ounces can be accumulated until the first time that occurs (assuming the analysis is worth a shit).

AgShaman's picture

exchange rate.....not price

"Price" implies that a tribute be exacted for the purchase of a collectible

This is nonsense. Gold is going tier is money. Switching out, from a "reservation" on the Titanic will not be constrained by "price fixing" much longer.

Shock induced most likely....but PM's will be going mainstream. The herd will need to get involved for the last phase, and provide the fuel for the mania.

Urban Redneck's picture

But there is NO GAIN and NO PROFIT in the preservation of purchasing power.

Most people have too much "investment" and not enough "savings" but there is a point at which "savings" become excessive (and exceedingly non-productive) if there is no diversification into "investment"

One can simultaneously have savings in PMs, investments in PMs & PM proxies & derivatives, and hedges against those open investment positions-  at which point the price of PMs is very important (just not to the savings component).



FreedomGuy's picture

Things can be priced in PM's. However, any currency that fails will probably be immediately replaced by a new one. New marks vs old marks. New peso's vs old and last, new dollars versu old. It will start all over again.

I love the utter simplicity of PM's. It is like economic art. You cannot manipulate exchange rates. No one in China will give you six one ounce Pandas for one gold eagle. It's one to one and the difference is what an ounce of gold will buy you in both countries. PM's are an economic Rosetta Stone. I can lift up an ounce of silver or gold in any country in the world and point and barter. We may not even be able to speak.


DanDaley's picture

Just remember, boys and girls, something (gold, silver, fiat, beans, bullets, etc.) is only worth what you can get for it or what you can use it for.  What ever it is, sell dear, like a good lookin' virgin.

mayhem_korner's picture

 Big Duke..


What about the argument that the QE liquidity overflow is enabling EFT (paper) gold to be purchased by the mitt-ful, effectively diluting what the "price" of the underlying physical PMs should be?  That would suggest that QE is, for now, supressing the "price" of PMs.

BigDuke6's picture

Everytwat is suppressing PM's.

And they r doing a frustating job of it.

i'm too impatient i know

marathonman's picture

The Squid will get a big chunk of your stack as 'capital gains' if you ever convert it to FRN's.  Heads they win.  Tails you lose. 

reader2010's picture

Holy Shit. That's the best pussy I've ever seen. The porn says all the orgies got started on Jekyll Island. Its gonna end in both tears and blood for sure.

Urban Redneck's picture

I prefer source documents - Aldrich's National Monetary Commission report of 1910.

The Latin Monetary Union and the opportunities for centralizing (in their mind private) fiat note issuance under a gold standard, which are so greatly expanded when the constraints of said gold standard are discarded...

Ghordius's picture

excellent and interesting document about how the FED ended to be a (imo bad) copy of the Swiss National Bank, which in turn was engaged at that time in the Latin Monetary Union - which standardized the gold coins of that epoch

What's your take on this? I find your comment a bit cryptic

I usually point out that the SNB is owned mostly by the State Banks (Banques Cantonales) which are mostly owned by the Swiss States (Cantons), often backed by them (a mere detail, in most of the times though it can be relevant at times) and that as such this looks as one of the better ways to set up a National Bank, to me

of course this leads in my mind to that other copy of the SNB, the ECB. I find most readers don't believe me when I point out that most european countries have National Banks instead of private Central Banks, and so the ECB has to be seen as a confederation of national banks

Urban Redneck's picture

I think most people aren't reading an analysis from 1910 with the mindset of the different challenges that the bankers faced in the early 20th century (albeit with the same greed they possess today).  The gold standard wasn't going away anytime soon back then (and how the money supply is controlled and expanded under a gold standard is different than today under a non-backed standard).  The US monetary system was on the one hand- supplied by gold mined out west, and on the other- converted to fiat to be loaned back east (or collected as tariff duties by the Federal Treasury).

I think the notion of diversification of ownership and risk within the Federal Reserve system was a triumph of marketing over substance.  Much like one can argue that the Canton of Uri and Urner Kantonalbank own shares of the SNB, and spread the risk & reward, but SNB control is centralized, and risk/reward is concentrated in ZH, BE, VD, SG and GE (although gold production is concentrated in TI & NE).

However, by creating a national syndicate, which maintains the appearance of a diversified and public-interest entity, but which was actually concentrated in NY and effectively controlled by a handful of private banks, they could prevent competition and reap a commensurate to out sized share of the rewards that accrued to the monopoly syndicate.

Where Switzerland had sovereign Cantons whose interests has to be taken into consideration (and compensated for the authority bestowed) the Civil War in the US half a century earlier had negated that concern in the US  (and even the necessity of involvement of state governments) if a new monopoly could be established under Federal authority.

Imitation is the sincerest form of flattery, but the Freaks of Jekyll Island covertly swapped their own interests for the public interest they espoused, through the delineation of design details outsiders don't bother with or have the expertise to fully comprehend.


Ghordius's picture

excellent analysis, and a succint one, too. you know what I find funny? by creating this NY-centered "leveraged control" system, the FED lacks one item that it's template SNB still has: an (intrinsic) interest to (shareholder) profit, i.e. doing a good job, in the capitalistic sense, when operating as a fiat currency provider (as you say, in 1910 the gold standard was a given)

I had a Russian friend (and historian) who would have said: "triumph of marketing over substance? you mean like the British against the German Empire?"

Urban Redneck's picture

I think the theory is more attractive than the practice, but then since

1) I have yet see Ben Bernanke publish a regular accounting of the toxic crap that FRBNY is protecting Citibank equity and debt holders from with taxpayer dollars; and
2) I have yet to hear Mary Schapiro ban Citibank from all acquisitions and financial "innovations" without prior approval from the SEC, and demand that Citibank strengthen both its balance sheet and liquidity above and beyond the requirements of Basel III.; and
3) I have yet to hear Timmy Geithner proclaim that thousands of Citibank layoffs are a good first step towards reducing Citibank from TBTF to a manageable risk, much less that Citibank should be monetizing their cherished NYC real estate to raise capital now.

It could be worse, my money could be in a US regulated bank, where Ben Bernanke would be debasing it with even less regard for the broader consequenses.

blunderdog's picture

     the Freaks of Jekyll Island covertly swapped their own interests for the public interest they espoused,

I think it's a mistake to presume it was a "covert" effort.  I think the Fed-disciples would actually say (and believe) that preserving a strong banking system is, IN ITSELF, in the public interest.

It's all fine and good to disagree, but the point is that you're not necessarily talking about people who are intentionally lying about what they do.

Urban Redneck's picture

There always concurrent and conflicting "truths" promoted in advancing the Big Lies, because of the buy-in required from disparate and competing interests in order to implement Big Change. This is what makes history so challenging to study, and leaves the vast majority so ignorant- because they tend to rely on lengthy textbooks which are actually no more sophisticated than Cliff's Notes, even if they are not intentional propaganda.  

1) The primacy of slavery or states' rights in the execution of the Civil War.
2) The primacy of free trade or energy security and continued US hegemony in GHWB & the NWO's pursuit of NAFTA
3) The competition between short term and medium term interests evident in the temporary truce between the conflicting interests of the globalists (internationalists) and the NWO in the 2007-2009 financial crisis. 

The aim of strengthening the banking system is an example of one of these conflicting truths. It was & is necessary for buy-in, both from participants and legislators, but that goal is contradicted by the lack of checks and balances specifically designed into the system, much less the impenetrable protections to the influence and control of the FRS by an oligarchy of banking interests through the executives they hire to manage the for-profit banks they control in NYC.

Fix It Again Timmy's picture

Central banking - very bad juju.......

Sextus Empiricus's picture

Evolution... but not of the human race.

Central banking is like a spider that has years to weave a web.  The longer it's alive, the larger the web grows, and the more the spider can eat.

And you know how spiders like to eat.  First they pump you full of the stuff that liquifies, and then they suck the good stuff out.

e-recep's picture

good analogy.... cheap credit being that solvent.

palmereldritch's picture

I really thought a mapping of the Borg's DNA would have had a more decidedly occult image.

plata pura's picture

the pamphlet entitled founding finance be a good read on the subject

Mr Lennon Hendrix's picture

Hey, look at that, Krugman is right, debt does equal the money supply.

newengland's picture

Gotta love the fight club.

Facts and figures tell all that is worth knowing. I pity anyone who buys into the main scream media BS. They are supine, unable to protect themselves when the political and bankster class rob them in broad daylight...just as the founding fathers warned would happen if the people allowed private banks (the Fed) to issue money without restraint.

That two faced useless git Bill Clinton ended the Glass Steagall Act, and cavorts with his dumpy wife at the Kennedy Center when he ought to hide his lying face in shame.

There are two classes of people in the USA today: the political/banking class status quo ... and everyone else.

Buy physical gold and silver...and any other food or metal protection you deem necessary.

I find it cheering yet ominous that my neighbors are ready to revert to traditional New England ways of self sufficiency, and pity carpetbaggers and politicians of all colors.

It is our land and our neighbors. If the government or foreigners want it, then they can come and try to take it with their own hands. Their hands. 

Possession is nine tenths of the law.