Chicago Federal Reserve on “Modern Money Mechanics”

“It started with goldsmiths. As early bankers, they initially provided safekeeping services, making a profit from vault storage fees for gold and coins deposited with them. People would redeem their “deposit receipts” whenever they needed gold or coins to purchase something, and physically take the gold or coins to the seller who, in turn, would deposit them for safekeeping, often with the same banker. Everyone soon found that it was a lot easier simply to use the deposit receipts directly as a means of payment. These receipts, which became known as notes, were acceptable as money since whoever held them could go to the banker and exchange them for metallic money.

Then, bankers discovered that they could make loans merely by giving their promises to pay, or bank notes, to borrowers. In this way, banks began to create money. More notes could be issued than the gold and coin on hand because only a portion of the notes outstanding would be presented for payment at any one time. Enough metallic money had to be kept on hand, of course, to redeem whatever volume of notes was presented for payment.

Transaction deposits are the modern counterpart of bank notes. It was a small step from printing notes to making book entries crediting deposits of borrowers, which the borrowers in turn could “spend” by writing checks, thereby “printing” their own money. …”

Straight from the horse’s mouth.  Banks create money out of nothing, but if you can’t keep up on your payments to the bank, they get to keep your house, car or whatever.  And if the bank is a central bank, it’s the government itself that “borrows” from the magician.  But what is the collateral?  The power of the government to tax the people.  The IRS is the collection agency for the owners of government debt.  Who owns government debt?  Anyone can buy a treasury bill, but as an economic class it’s the increasingly narrow demographic of the super rich that buy most of it and collect the $400B/year in interest payments on it.     The debt itself is entirely fictitious and immoral, while the interest payments are an ongoing hemorrhage of our national lifeblood.  And it’s all completely optional.  The American Monetary Act ( ) would undo the 1913 federal reserve law and restore the constitutionally guaranteed power to create (i.e. “coin”) debt-free money to the people.  In so doing, public debt would be converted to banker debt as it should have been all along, bankers would perform the useful function of acting as intermediaries between borrowers and depositors as most people think they already do, the national debt and associated interest payments (the rationale for austerity) would disappear overnight, and this country would experience an enduring grassroots economic boom that would make its economic history only a prelude.

As it stands, the shareholders of the privately owned federal reserve (the likes of jpmorgan, goldman sachs, wells fargo) (see file# 0042817 at ) can pump and dump the entire economy for profit, which is what they’ve been doing, in fact bernanke admits that the fed caused the great depression ( )  And now they’ve done it again, deliberately.  Here’s a smoking gun:  .  Think about how this investigative blockade and the rating agencies A+ ratings allowed the toxic, taxpayer subsidized (FNMA and FHLMC) mortgage derivatives to permeate every nook and cranny of the financial system in the context of a historically unprecedented debt-based bubble.    FNMA and FHLMC shielded predatory lenders from financial liability, and Bush’s blockade shielded them from legal liability.   A recipe for corruption.   And then the central bank of central banks (the BIS) changed the accounting rules to pull a rug out from under the whole house of cards.    Suddenly no one knew the creditworthiness of anyone else, which dried up liquidity and started the pyramid of debt-collateralized debt to implode.   (deflation)   They accomplished what they’d done in the 1930’s by other means.  And the fed’s solution?   Throw money at the TBTF’s, its own shareholders, the same people who had bet on the collapse of mortage securities even as they were selling them to the gullible public.   Seems like everyone knew except those who needed to know.

Meanwhile the fed has supervised the looting of the US treasury’s gold in a decades-long operation to suppress the price of gold:   Do you see those fraction of a percent “lease” rates?   That’s effectively the actual purchase price (with a yearly fee) for the bullion banks, since the gold can never be repaid once the price spikes in anticipation of the dollar’s meltdown.   And who’s buying the gold at a large discount on the open market?   The people in the know, obviously.   For the past few years this has included russia and china.

The federal reserve (part of the central banking cabal) is the biggest threat to national security (nay, the most demonstrably destructive public enemy) this country has ever faced.   Hitler would have been proud to accomplish what these white collar crooks have done.   The USA is already on its death bed.  When the dollar goes, there will be no bottom since these scam artists have already arranged for the export of most of our industrial infrastructure.   If you want to understand the political ramifications of what they’ve done, check out the links on the Shock Doctrine and Tragedy and Hope in the reference section.  This is their BUSINESS MODEL, and their ultimate goal is a global government under the control of the privately owned central banks.   But there is still a way out of much of the suffering they’ve arranged for us, all it requires is to pass something like the american monetary act above.

Why isn’t all this common knowledge on the street?  Why has the media hidden it?  Is it all just something they forgot to mention in grade school?  Do you think the super rich are ignorant of it?  How about congress?  Kinda makes you feel left out of the party doesn’t it?

Reiterating: Glenn Beck show on the “federal” “reserve”

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