If the Federal Reserve is 'buying', where does their 'money' come from ?
Or are they 'borrowing' from somebody else ?
Sounds like a big ponzi scheme con game.
The federal reserve creates the money, and does so at interest. They don't borrow from anyone. Fractional reserve banking has some resemblance to a
ponzi scheme but with proper regulations isn't one. Most notably, the money creation can't be in private hands but rather in public ones such as
congress. It's not a new concept, fractional reserve banking has been in use since the 1600's. The difference between then and now is that for the
past 100 years we've had a private entity controlling the money supply. They're free to do with it as they wish, which usually involves boom and bust
cycles that allow for mass profit when property can be collected for a fraction of it's value. We actually had some good regulation that prevented a
large part of this but got rid of it in the 90's, it was called glass-steagall. When that was actually enforced, private banks couldn't take
depositors money and then invest it at no risk to themselves.
Just wait until the Chinese call their bonds or the Middle East decides to value oil in Euros.
Sit back and watch the fun.
They would never do this, every developed nation is indebted to every other nation as a form of security. By indebting to each other, and then
backing the value of your currency with that debt it creates an economic safeguard against war. By going to war, the debt is erased. When that
happens the currencies destabilize and everyones economies melt down overnight. It's another form of MAD and it was set up deliberately to prevent
war. The truth is, even doing something like the talking points tend to suggest and paying down our debt destabilizes our system. National debt
doesn't work the same as public debt, with national debt the responsible thing is completely contrary to all logic which is to let debt accumulate and
not pay it off... only pay the interest. This actually strengthens the currency (which is why the debt ceiling argument every few years is absurd,
and actually quite dangerous to argue over). We would actually spark WW3 and crash the worlds economy if we came up with and followed through on a
plan that eliminated the national debt in say 5 years.
A nation accepting currency other than dollars is a much bigger deal, but I don't understand reserve currency theory enough to go into detail on
If they actually OWN the nation through debt? Well, it's not a shadow thing anymore and their power isn't figurative or behind the scenes...but real
and legitimate, right out in public view, right?
I figured this out after the 2008 collapse since that was the first time I had really paid attention to it. When things go as planned this is how a
home loan works for the banks:
Step 1: The home buyer comes in with 15% down on a $100,000 house. The bank approves the loan.
Step 2: The bank through the power of leveraging and fractional reserve banking creates between $150,000 (10:1 which is actually quite healthy) and
$1,125,000 (75:1 which is extremely dangerous and what Lehman did, Chase does, and so on) worth of credit in their accounts. The bank then uses this
money to make investments. It often goes to things like college loans, commercial paper, and so on.
Step 3: The bank gives the home buyer a loan repayment schedule for around $135,000.
Step 4: The economy goes south, the home buyer is $45,000 into his repayment and falls behind. Soon foreclosure happens.
Step 5: The bank keeps their $45,000 as well as holds the remaining $90,000 as an asset unless it gets discharged in bankruptcy. They also take the
house. Note that the $45,000 repaid was in actual cash which means it can be leveraged like the initial amount down.
Step 6: The bank puts the home up for sale for $125,000 due to appreciation and repeats the process.
The end result is that it's actually in the banks interest for the home buyer to default. If a default happens such as in this case they gained a
property worth $125,000 as well as $60,000 in reserves. All together they profited $180,000 in direct assets and far more through the loans they made
when leveraging cash.
Given enough time by causing economic boom/bust cycles (easy to do for the fed, since they own the money supply) they can pick up massive amounts of
property for very little money. Often times actually being paid to take the property away.
The entire concept of interest, needing to repay more than was originally put in is one that says given enough time the banks will own everything.
That works because our money is created at interest. The only fix is to have debt free money, which has worked many times throughout history and even
worked twice in US history (greenbacks and colonial script).
I think ppl who invest in gold/silver are naive. (sorry) They confiscated it once before, and may so again.
I've heard ppl say "I'll just hide it", so what good is it then?
I'm more accepting of silver than gold. It's easy to monopolize gold production, while silver being much more common is harder to monopolize. That
said, neither are what you want in an economic collapse. If the economy collapses a two things are going to happen:
1. Whatever commodity is being used for currency is going to be nationalized. It was done in the past with gold. At this point your asset is going
to be stolen, it's going to be illegal for you to posses or use it, and it's going to be taken by the government.
2. Most commodities are sent out to people through claim checks. Slips of paper that say they have a claim on X amount of the stuff at a certain
warehouse. In a collapse those claims are going to be invalid, whoever possesses it will own it until the government comes along and takes it.
"The few who understand the system, will either be so interested from it's profits or so dependant on it's favors, that there will be no opposition
from that class." — Rothschild Brothers of London, 1863
I understand the system (mostly... it really is quite complicated, and the sheer volume of the currency involved is staggering), but make no profits
from it. I even support parts of the system. Other parts are outright bad though. The real shame is that our government doesn't understand the
system. That has allowed the bankers to get far more control than they should have.
edit on 25-9-2013 by Aazadan because: (no reason