206

These two men were allowed to stay on the Board so many years 

because they were both eminently respectable men who gave the 

Board a certain prestige in the eyes of the public. During these years 

one important banker after another came on the Board, served for 

awhile, and went on to better things. Neither Miller nor Hamlin ever 

objected to anything that the New York bankers wanted. They 

changed the discount rate and they performed open market 

operation with Government securities whenever Wall Street wanted 

them to. Behind them was the figure of Paul Warburg, who exercised a 

continuous and dominant influence as President of the Federal 

Advisory Council, on which he had such men of common interests with 

himself as Winthrop Aldrich and J.P. Morgan. Warburg was never too 

occupied with his duties of organizing the big international trusts to 

supervise the nation’s financial structures. His influence from 1902, 

when he arrived in this country as immigrant from Germany, until 1932, 

the year of his death, was dependent on his European alliance with 

the banking cartel. Warburg’s son, James Paul Warburg, continued to 

exercise such influence, being appointed Franklin D. Roosevelt’s 

Director of the Budget when that great man assumed office in 1933, 

and setting up the Office of War Information, our official propaganda 

agency during the Second World War.

In The Fight for Financial Supremacy, Paul Einzig, editorial writer for the 

London Economist, wrote that:

"Almost immediately after World War I a close cooperation was 

established between the Bank of 

 

England and the Federal Reserve 

authorities, and more especially with the Federal Reserve Bank of New 

York.* This cooperation was largely due to the cordial relations existing