When a baby is born, doctors often tie or clamp the umbilical cord almost immediately. This ensures that most, if not all, of the cord blood never makes it to the baby. This is the blood that is banked. If the cord blood is not banked, it is thrown away! I first heard this while talking to one of the largest cord banking companies. I asked the woman on the phone whether or not the baby needs the cord blood at birth, or if it's okay for it to be taken from her. The woman replied that it must be okay to take it at birth because if the blood isn't banked, then the doctors just throw it away anyway. Huh? They throw it away? Yep. The umbilical cord is clamped right away when the baby is born and the trapped blood is thrown out.

Early cord clamping is a recent medical trend, which has only been practiced since the 1940s and only in a few countries, including the U.S. Early cord clamping is not natural, normal, or based on any evolutionary need. In 1801 Erasmus Darwin (one of the most important physicians and intellectuals of his time) was one of the first to urge that cord clamping not occur until all cord pulsation ceased. Clamping the cord early is an interruption of a natural process. There is no evidence to show it is beneficial to the baby in any way. The World Health Organization states, "Late clamping (or not clamping at all) is the physiological way of treating the cord, and early clamping is an intervention that needs justification."  [1]

Umbilical cord blood is a baby's life blood until birth. This blood contains magnificent cells such as red blood cells, stem cells and cancer-fighting T-cells. It comes from the placenta since the umbilical cord is attached to it. The placenta really belongs to the baby; it is one of the baby's organs while the baby is growing inside the mother. When a baby is born and the umbilical cord is cut quickly, it is akin to amputating a live organ from a person. It is the same as submitting the newborn to severe hemorrhaging. If the umbilical cord is not cut, the placenta will expire naturally in an hour or so, after the blood has fully drained into the baby. [2]

References:

[1] World Health Organization (1996). Care in Normal Birth: A Practical Guide.
[2] De Marsh, Q.B, (1941). The Effect of Depriving the Infant of its Placental Blood. Journal of American Medical Association, 116(23), 2568-2573.