How loans and mortgages by banks are fraud

Revolution Not

The Secret of Oz

The Secret of Oz is a new documentary video from the creator of “The Money Masters.”   Basically one of the main premises of the film is that as long as the government or some other good guy controls the issuance of currency, and it’s issued debt-free, the money system will benefit the public and not just the elite.   I don’t entirely disagree with the idea that a fiat system *could* work for us, but in practice the power to issue currency has repeatedly fallen back into the hands of the bankers.  Even if we allow them to issue something as simple as gold or silver receipts, bankers will inevitably turn it into a fractional reserve system and defraud the depositors, concentrating wealth for themselves. So I’m surprised they are so quick to dismiss gold. 

Rich people do already hold most of the gold, yes.   But they also control the government printing presses, and it’s a lot easier to inflate paper (or numbers in a database) than it is to prevent people from digging more gold out of the ground.  Private companies can will continue to mine gold, somewhere.   Metals markets are international.  For thousands of years, humans have been able to spend a gold coin anywhere in the world.  Metals already are the world currency. Fiat currencies come and go but gold holds intrinsic value.

Now as for the rich hoarding it, I would argue that inflatable, easy-to-manipulate fiat money systems have enabled the bankers to obtain a disproportionate share of real assets, such as metals and property, using their 100:1 fractional reserve leverage and inflationary money creation thru loans. Are you aware that in the ’30s the US government actually confiscated gold in the name of saving everyone from the banker-engineered great depression?

If we went to a metal and barter economy, commerce could be less centralized yet more global. Even gold and silver certificates present the opportunity for fraudsters to create a fractional reserve system which is in essence a ponzi scheme. While metal bullion is not fraud-proof (recall recent tungsten bars plated with gold) it’s significantly more difficult to manipulate on a large scale.

• A big pile of gold doesn’t do you much good unless you spend it into the economy.
• It’s difficult for bankers and governments to maniuplate the worldwide flow of gold out of the ground, due to market competition.
• It can’t be counterfeited with current technology

We don’t actually need a currency “backed” by anything.  All we need are land, food, water, protection, and some metals and other raw materials to trade for goods and services. I want no part of this casino gambling.

The international banking elite control the issuance of currency. They are not going to give up that position without a bloody fight. BUT… gold and silver exist already in the free market. We can dig more of it out of the ground, while bankers, government, and whoever has control over the issuance of currency can “row” the fiat economy with ease. “Power corrupts, absolute power corrupts absolutely.” One thing corrupt officials can’t do, however is create gold or silver out of thin air. They can flood the market, but they’ll be losing their own wealth in the process. And no, the bankers don’t control all the gold. Actually I believe the Vatican is the single largest owner of gold in the world. Better brush up on your Hail Marys.

Maybe someday we’ll find a way to enforce strict control over a fiat paper currency, and permanently protect ourselves from corrupt hands massaging all the wealth out of the economy by means of inflation and deflation. Until this technology exists, metals are the next best thing.

“It’s not what backs our money, it’s who controls the quantity.” Makes sense.  And the quantity of gold is a lot harder to manipulate than the quantity of fiat paper or zeros in a database.
The new human rights movement

Although I honestly think in the current environment gold and silver are the most fraud-resistant form of money, there is one big problem with it – the environmental cost of mining. We need to find sustainable methods to mine gold that don’t involve cyanide. But when you weigh the downside of living in this banker-take-all system, it becomes apparent which the lesser of 2 evils is.

Thank you for reading, and may your chains rest lightly.

The Federal Reserve system is a ponzi scheme

A buddy of mine just launched a new informational site about our debt-based fake-money “Federal” “Reserve” system.  It’s a quick 1-page overview of the fundamental flaws in our economy.

Unless we fix these problems our economy will continue its downward spiral into neo-feudalism under banker rule.

Have a look

University-brainwashed-trained economists especially need to read this.

Hard-nosed Fed sends global markets reeling

Revolution Not

More ominously, some Fed officials fear the central bank is already “pushing on a string” and does not have the means to revive the economy. Whether or not they are right, this comes as a psychological shock for investors schooled by the “Greenspan Put’ into thinking that there is a deus ex machina in the wings.

What goes up must go down… especially in a world being depleted of resources faster than ever.

Goldman Sachs said the yen was now overvalued by 20pc, or two “standard deviations” out of kilter

This is the most interesting aspect of this article. This implies that Goldman’s algorithms for calculating prices aren’t working any more. This has several very important meanings.

• The High Frequency Trading Algorithms used by the banks aren’t or can’t take into account macro economic trends.
• Their algorithms are much less effective at controlling the market now.
• Most importantly, the markets have broken out of long and old trading patterns.

Add in that their algorithms have known bugs or purposeful defects, as was demonstrated by the Flash Crash, and this is a recipe for disaster. Now, anything could happen.

Here is a good example of the problem:Demonstrating An HFT Algo Gone Apeshit

Well, today we just experienced another mini flash crash, after some algo went apeshit and decided to hit every bid on the way down, all the way to 0.0001 (gotta love that sub penny quoting just above zero). Below we show how this algorithm pushed the stock price of Core Molding from its normal price of $4.12 all the way down to $0.0001 in the span of one second, after an HFT program went ballistic, and would have kept on hitting the subpenny $0.0001 bid in perpetuity. It must have been swell to be a CMT holder: one second your stock is worth $4.12, the next, it is worth $0.0001 (and no, not $0.0000, how else will the computers game the NBBO in subpenny increments).

Two excellent videos about economics, fiat currency, and fractional lending

The Money Masters – How International Bankers Gained Control of America

Money As Debt

Money Out Of Thin Air: Now Federal Reserve Chairman Ben Bernanke Wants To Eliminate Reserve Requirements Completely?

Economic Collapse Blog

Up until now, the United States has operated under a “fractional reserve” banking system.  Banks have always been required to keep a small fraction of the money deposited with them for a reserve, but were allowed to loan out the rest.  But now it turns out that Federal Reserve Chairman Ben Bernanke wants to completely eliminate minimum reserve requirements, which he says ”impose costs and distortions on the banking system”. At least that is what a footnote to his testimony before the U.S. House of Representatives Committee on Financial Services on February 10th says. So is Bernanke actually proposing that banks should be allowed to have no reserves at all?

That simply does not make any sense. But it is right there in black and white on the Federal Reserve’s own website….

The Federal Reserve believes it is possible that, ultimately, its operating framework will allow the elimination of minimum reserve requirements, which impose costs and distortions on the banking system.

If there were no minimum reserve requirements, what kind of chaos would that lead to in our financial system?  Not that we are operating with sound money now, but is the solution to have no restrictions at all?  Of course not.

What in the world is Bernanke thinking?

But of course he is Time Magazine’s “Person Of The Year”, so shouldn’t we all just shut up and trust his expertise?

Hardly.

The truth is that Bernanke is making a mess of the U.S. financial system.

Fortunately there are a few members of Congress that realize this.  One of them is Republican Congressman Ron Paul from Texas.  He has created a firestorm by introducing legislation that would subject the Federal Reserve to a comprehensive audit for the first time since it was created.  Ron Paul understands that creating money out of thin air is only going to create massive problems.  The following is an excerpt from Ron Paul’s remarks to Federal Reserve Chairman Ben Bernanke at a recent Congressional hearing….

“The Federal Reserve in collaboration with the giant banks has created the greatest financial crisis the world has ever seen. The foolish notion that unlimited amounts of money and credit created out of thin air can provide sustainable economic growth has delivered this crisis to us. Instead of economic growth and stable prices, (The Fed) has given us a system of government and finance that now threatens the world financial and political institutions. Pursuing the same policy of excessive spending, debt expansion and monetary inflation can only compound the problems that prevent the required corrections. Doubling the money supply didn’t work, quadrupling it won’t work either. Buying up the bad debt of privileged institutions and dumping worthless assets on the American people is morally wrong and economically futile.”

The truth is that the financial system that we have created makes inflation inevitable.  The U.S. dollar has lost more than 95 percent of the value that it had when the Federal Reserve was created.  During this decade the value of the dollar will decline a whole lot more.

That doesn’t sound like a very good investment.

But that is what happens when you give bankers power to make money up out of thin air.

And things are only going to get worse.

Especially if Bernanke gets his way and reserve requirements are eliminated entirely.

The U.S. economy is a giant mess already, and we have got a guy at the controls who simply does not have a clue.

It’s going to be a rough ride.

Kucinich calls on Congress to take control of the Fed, end fractional reserve banking system

Dennis Kucinich speaks to the participants of the 2009 American Monetary Institute’s 5th Annual Monetary Reform Conference:

Fractional reserve, banks, and foreclosures

RevolutionNot.com

I’ve been thinking a lot recently about the banking system in the USA and how banks create money out of thin air (if they have the reserves).

Under the fractional reserve system, banks are allowed to create money through a multiple of their reserves. When they create the money, it becomes the reserves for the next bank and so on and so forth. The reason why this is corrupt is because the banks don’t create value. They only create money. They only create money through loans, meaning they own the real value until you pay them back with their fake, newly minted, money

As this crisis continues they have stopped lending…. This has an important side effect. When a bank lends, they create new money. This is the only way a bank will lend because it’s virtually risk free for them. They now see money creation as too risky.

The problem we are running into now is that the banks aren’t creating new money, ahem, they aren’t lending. This can be seen here in the recreated M3:

Recreated M3

As banks continue to go bankrupt, their creation of new money dwindles. The effects of which can be seen in the decreasing M3 over the last few months.

This is why the banks continue to get preferential treatment over average citizens. They create the money. New money is ESSENTIAL to the functioning of our economy.

The reason is quite simple actually. When the bank system loans new money, they don’t lend out the interest payment. Meaning, a new loan must be taken out by the economy in general to pay the interest of that person (or company). Thus, new money is essential to keeping the race going.

Without new money, more and more people won’t be able to pay back their loans. We are already seeing this happen with the never ending “foreclosure crisis.”

Until new money is being created by the banks then there is less and less money to be able to pay the banks their interest.

What’s really cool about this is that the government has been doing EVERYTHING they can to buoy the balance sheets of banks and they still aren’t creating new money. In fact, the banks don’t want government money because they can’t give themselves billions in bonuses.

The decreasing M3 is due to people paying off their loans. This has an amazing effect of causing less money to be in the system. In essence, if all loans were paid off, there would be no money anywhere.

So in the mean time, more foreclosures will occur both in residential and now commercial real estate. The banks will continue to be in bad shape regardless of how much they legally or illegally manipulate their books. This will cause no new money to be issued thus making the problems worse.

All those people talking about a “recovery” have no idea what’s really going on. A company’s balance sheet may look good but until the banks start issuing new money, the public will stay in a world of hurt. Foreclosures will remain high and jobless numbers will keep being massaged downwards.

So what are we to do? Well, the government has been trying to fund projects to inject money into the system. The problem here is that the government is getting the money… from the banks! Our government must pay back the interest on that… meaning…. you, me, our children, grandchildren, and, well, generations will be paying back that money.

If the government actual did the constitutional thing, and took the money creation powers back from the banks and reinstalled it with Congress, we may actually have a chance to make it. As it is, I am very pessimistic about the economy due to the fraudulent ponzi scheme run by the Federal Reserve.

Last note, the Federal Reserve has a mission to have a stable currency and try to maintain high employment. They have failed on both account horribly. They have debased the dollar by 95% over the last century, and unemployment is now 20%+ using actual numbers and not the fudged ones produced by the government. A stable currency would mean 0% inflation/deflation over 100 years. A target of 2% inflation per year is NOT stable. It’s exponential growth.