REGION A – NORTH / CENTRAL AMERICA
THE SINKING OF THE TITANIC
(April 14-15, 1912 – North Atlantic Ocean)
The Bank of Mexico
(Mexico City, Mexico)
ROTHSCHILD OWNED & CONTROLLED CENTRAL BANK
The Official Story
THE BANK OF MEXICO
(Mexico City, Mexico)
The Bank of Mexico (Spanish: Banco de México), abbreviated BdeM or Banxico, is Mexico’s central bank, monetary authority and lender of last resort. The Bank of Mexico is autonomous in exercising its functions, and its main objective is to achieve stability in the purchasing power of the national currency.
The current constitution of Mexico was signed in 1917. Article 28 of that constitution stipulated that all paper money would be issued by a single bank controlled by the government. But it wasn’t until the end of 1924 that the Ley General de Instituciones de Crédito (General Law of Credit Institutions) was passed which was the legal antecedent for the Banco de México. The law prevented banks from owning stock in other banks and eliminated the stock exemption for banks. Most importantly, the law called for the creation of a central bank.
The Banco de México was created on August 25, 1925 under the direction of Minister of Finance Alberto J. Pani with an official ceremony given on September 1, 1925. It was given exclusive authority to mint coins and print banknotes, a sharp departure from policies of the past. The bank was also given responsibility over exchange rates, interest rates, and monetary regulation. Initially, retail banks even had the option not to partner with Banco de México. The main goals of the Bank at that time were to unify the fractured banking system left behind by the Revolution, create a flexible financial system that could modernize the country, reestablish credit, and renew trust in paper money.
The bank’s first years were difficult. Initially only two private banks affiliated themselves with Banco de México, and by 1927, in the midst of the Christero War, the bank exceeded the legal limit of how much it could loan to the government. The unease of the private banking institution was assuaged somewhat when the initial offices of Banco de México were temporarily located in the headquarters of the Banco de Londres y Mexico. The banking interests cemented their relationship with the government by issuing loans to government officials, ensuring that the politicians had a vested interest in the stability of the system.
In 1932, laws were passed that required all private banks to invest their capital in Mexico and associate themselves with Banco de México. The laws also required that Banco de México cease operating as a commercial bank. After passage of this legislation, only three foreign banks remained in the country. These changes and a looser restriction on the issuance of banknotes led to a growing trust in the central bank.