After-the-Fed Proposed Solutions

Originally posted by Mary Rose
reply to post by mnemeth1

 

Okay.

Tell us about your The Suede College of Austrian Economics.

Click the link and start watching.

Maybe a good compromise between goldbugs and greenbackers is to back currency with silver.

Eric's article appears on infowars.com, and I like this statement from the Comments section:

KillTheEmpire.blogspot.com Reply:
October 13th, 2010 at 8:33 am

People tend to think of money as value. Money is not the value in an economy. The physical economy itself is the value. Money is only a means of exchange used to make barter convenient. If you want to increase the value of your physical economy you must increase knowledge of the people. Knowledge is the key to increasing production, increasing discovery, creativity, making technological advancements, producing more in a given amount of time, etc, etc.

YOU are the real wealth.

There is a proposal by Dr. W. Cleon Skousen that was evidently written in the 80's that is part of an article entitled "The Urgent Need for a Comprehensive Monetary Reform."

In Part 3 of the article it is pointed out:

The important point to recognize is that if the United States bought back the stock of the Federal Reserve System, the government would also be entitled to all of the assets and "reserves" of the system, including these bonds for which the Federal Reserve and its member banks paid nothing. These bonds could then be immediately canceled since the government would own them. They would not have to be redeemed, nor would any further interest be due on them. . . .

There is another huge supply of U.S. bonds in the trust funds of various federal agencies. These trust funds were originally set up to maintain a ready supply of emergency cash, but over the years these trust funds have been spent and replaced with U.S. bonds or IOUs. All of these bonds belong to the United States and should therefore be canceled, since they belong to the government and should be considered redeemed with no further interest due. . . .

All other outstanding U.S. bonds should also be redeemed and canceled out as rapidly as the economy will permit. The United States would then be completely out of debt . . .

I'm wondering about the Social Security Trust Fund. Is he saying wipe it out and forget about it???

This is followed by the plan for a new system, under the heading "Legislative Steps Needed to Stabilize the U.S. Monetary System":

Just as soon as the government has paid the debts, met the dividend requirements, and repaid the stockholders of the Federal Reserve System, the Congress could proceed to take the steps which economists have been working out in progressive detail since the days of Thomas Jefferson. The basic requirements for the new monetary system should be carefully codified in an amendment to the Constitution. This legislation could be set up quickly by an act of Congress. Eventually, it would need to provide for the following:

1. Freezing the money supply at its present level to prevent any further deterioration by inflation.

2. Setting up the necessary monitoring machinery to keep the supply of money within 3 percent of the gross national product (goods and services), using the price index to provide a month-by-month correction so as to keep the ratio between the money supply and the GNP as exact as possible.

The only exception to the 3 percent restriction would be in time of war or an extreme emergency declared by Congress. The law should require that the excess money supply pumped into the monetary system to meet the needs of the emergency must be drained off through taxes or other means within five years so as to bring prices and the supply of money back into their original ratio. Only by this means will the savings of the people retain their buying power or "value" from generation to generation.

3. Appointing the trustees in charge of the proposed Federal Monetary System to permanent positions until they reach the age of seventy. Their compensation should be substantial and not subject to being diminished during their term of service. The law should also provide for severe punitive action, in addition to impeachment, for any dereliction of duty on the part of these trustees or their supervisory officers.

4. Issuing new United States notes to replace the Federal Reserve notes which would be redeemable, at the option of the government, in either gold or silver. Congress would designate the gold and silver reserves required for domestic currency as well as for transactions in foreign exchange.

5. Abolishing the Open Market Committee of the Federal Reserve System.

6. Forbidding all fractional banking by banks, loan associations, and individuals.

7. Allowing commercial banks and the public bodies of the individual states to borrow funds from the proposed United States Monetary System at 3 percent interest, these funds being allocated to each state according to its population, unless Congress should deem otherwise. In the absence of a war or emergency, no such loans would be available unless they could be made within the ratio of balance required between the money supply and the GNP.

8. Forbidding commercial banks and loan associations to loan any funds at interest in excess of 10 percent. Loans could be made only to the extent of funds borrowed from the monetary system, its tangible assets, or the savings of its customers. Each bank would be required to maintain a dollar-for-dollar balance on all demand deposits (checkbook accounts) and would charge for services rendered in handling checks, notes, or trusts for its customers. The present Federal Reserve branches would be taken over by the proposed Federal Monetary System and would provide clearinghouse services as at present.

9. Borrowing by the government would be forbidden. The right to create additional money for the people would be achieved by printing United States notes, without interest, and, except in time of war, would be subject to the limits of keeping the money supply in balance with the GNP. Issuing the people's money without paying interest and without borrowing would finally fulfill the formula of the Founders.

10. Incorporating all commercial banks as entities of the individual states or territorial possessions. There would be no federal banks or national banks. Nevertheless, the proposed Federal Monetary System would have supervisory responsibilities over all banks and loan associations to verify their liquidity and promptly detect any fractional banking practices or other violations.

The trustees described in #3 make me think of the Supreme Court - a life appointment.

Originally posted by mnemeth1
Money does not make a society prosperous.

It does if it is available for the start-up of new entrepreneurship.

Originally posted by mnemeth1
. . . fiat money . . . is forced on the public at gun point because the public would not voluntarily accept it . . .

The public will gladly accept anything that works.

Originally posted by Mary Rose
I found the Blair article posted on Ellen Brown's Web of Debt blog.

Here is another comment which is linked from the 2020 Speculator blog to Ellen's blog:

. . . In order of preference, my choice of monetary system is as follows;

1. Free banking. We get there by nationalizing bankrupt banks, selling them to the highest bidder, wiping out most or all of the illegitimately created national government debts, removing deposit insurance, and repealing legal tender laws. Then let the chips fall where they may.

2. All of the above, but in the end a return to the old government-mandated gold standard and free banking. Messy and inherently unstable, but doable. I know because it’s been done before.

3. Nationalized interest-free banking supplying interest-free credit, with full reserve requirements on the private banks. The Ellen Hodgson Brown solution. North Dakota on steroids.

4. Debt-free money issuance with interest-free fiat money being issued, and full reserve banking. The Michael Rowbotham solution. That’s being partially tried in the US right now with QE essentially allowing the Feds to spend without cost to keep the economy ‘liquid’ but it’s combined with fractional reserve banking so is inherently inflationary. Nazi Germany – but perhaps this will collapse into Zimbabwe-style inflation pretty quickly. . . .

I'm familiar with Ellen Brown's solution. I've read her book Web of Debt and I like the Monetary Reform Act that I learned about in her book. But I was not familiar with Michael Rowbotham. I googled his name but didn't come up with anything helpful. Anyone know anything about his work?

Originally posted by Mary Rose
I like the Monetary Reform Act . . .

I see there is a website The Proposed Bank of England Act that is calling for:

* prevent banks from creating the nation’s money supply (through a few small changes to the rules governing bank accounts)

* restore the right to create the nation’s money to a public agency of the state (the Bank of England under the direction of the Monetary Policy Committee, all under strict controls, transparency and separation of powers)

* use any newly created money to reduce taxes, fund better public services and/or reduce the national debt. (This is in direct contrast to the current situation, where three quarters of newly-created money created is pumped straight into the housing or commercial property market)

* as the economy stabilizes and the debt-burden falls, gradually synchronise the increase in the money supply to increases in productive capacity and population

* banks would continue to lend, but would do so as intermediaries between real savers and borrowers

Ellen Brown talks about the government issuing loans and having the interest collected on them substitute for taxes.

Reduction in taxes is a big plus for a monetary reform plan.

A fun video. Yes, people need to get involved.

Originally posted by Mary Rose Are you an American?

Washington DC is independant of America so wh should we pay someone elses debts.

Originally posted by Mary Rose
reply to post by mnemeth1

 

What would you suggest the U.S. do about the national debt?

Once The Fed is abolished all debt to them is instantly and immediately wiped off our books once and for all however, debt with foriegn nations still remain and require payback.

Originally posted by ..5..

Originally posted by Mary Rose Are you an American?

Washington DC is independant of America so wh should we pay someone elses debts.

Incorrect as DC is the Seat Of Government and makes them accountable to the lower tiers of Government. DC is not independant of the US.