It is about as accurate as saying that WWI happened because Gavrilo Princip disliked Austrians. And perhaps somewhat less so, given that the main thrust for a central bank never actually came from John Pierpont Morgan. One might prefer to throw names like Aldrich, Wilson, Glass, Willis, et al. around instead.
Now a comment on the rest of your contribution to this thread:
We’ve been having a relatively interesting, if not particularly robust discussion of the Federal Reserve’s reason for existence, spurred by the rather silly theories referenced by the OP. In the midst of this discussion, you suddenly pop up with some rather basic statements that aren’t particularly deep. Then, you reply to me in a fashion that seems to indicate you haven’t really read the thread up to this point. I believe you have much more of value you could contribute here (based upon your past history with this message board). I would hope that you could find the time to be a bit more careful, and a bit more contributory as the thread progresses.
This isn’t quite right. I’ve read the Lowenstein book and if I recall the Fed was created (in part) to lessen the power of financiers like JP Morgan. Morgan stepped up during the Panic of 1907 and probably prevented a deeper crises. Politicians were concerned that this gave too much influence to Morgan and wanted to put the power into the hands of the people (i.g. government).
This is somewhat incorrect. The private banks vote to choose 6 of 9 directors for their local Federal Reserve Bank. However these boards deal primarily with operational matters. Policy is set by the Federal Reserve Board of Governors (all appointed by the President and Congress), and the Open Market Committee (of which the President-appointed Governors constitute a majority).
The comment about profits is correct. In 2012 "the Fed earned $90.5B. Of this, $1.6B was paid out in dividends [fixed by statute]. The remaining $88B was remitted back to the US Treasury. "
