White House announces debt ceiling will be raised, bankers rejoice

In a last-minute turn of events, the US Government announced it will increase the debt “ceiling” for the 75th time since 1962.

What makes this time special is that National Debt is now equivalent to GDP (~ $13 Trillion).  A 1:1 ratio may not mean anything other than being a nice even number (like on the odometer of your car) for us to come to our senses and stop this self-destructive debt money creation before it becomes hyperinflation. Problem is, hyperinflation is the only thing the bankers can do now to sustain their ponzi scheme we refer to as the dollar.  Inflation has predictable results, like concentrating wealth in the banks and devaluing everyone’s investments ( ie savings and retirement).  As Ron Paul says, inflation is a hidden tax which affects the poor and middle class most, in our case, paid directly to the international bankers of the Federal Reserve System.  Who wants to be a millionaire?

Raising the debt ceiling this time is just one more step in a long process. They won’t default, they will just keep “printing” money until it becomes so worthless that everyone is forced to dump the dollar and adopt a new currency (Amero, SDR or what have you).  By this time there will be nothing to default on, and holders of dollar debt will have been robbed blind.  This is a manufactured Problem-Reaction-Solution dialectical mind trick marching us toward a world financial system and a perpetual state of financial depression; under a world government of, by, and for the banks.

The sane course of action would be to stop the imperial wars and nationalize the Fed immediately, but corporate interests control our government and the cancer is everywhere.

See you in the forced labor camp.

Debit cards: $50 spending limit coming?

(CNNMoney) — Declined! Your debit card may soon be denied for purchases greater than $100 — or even as little as $50.

JPMorgan Chase, one of the nation’s largest banks, is considering capping debit card transactions at either $50 or $100, according to a source with knowledge of the proposal.

Why? Because the bankers are here to enslave us, an this is a great way for them to to extract more fees.

Read more…

The Fractional Fraud: Seven Myths of Money

Revolution Not

After discussing fractional lending practices with all kinds of people, I am able to say that most people don’t know where money comes from or what it is. The people that should know the most are actually the least informed thinking they know the most about our fractional reserve system. That is to say, the bankers were the most confident in their ignorance of money.

The best example I have of this is here when Matt, the Supervisor of Wells Fargo Home Mortgage, continued to claim they weren’t a part of the fractional reserve system.

The most common myth about where our money comes from is that our money comes from the government. When the USA needs money, they print US Treasury Notes and exchange the debt with the Federal Reserve. The government can then spend the Federal Reserve Notes. This is approximately where 5% of the money comes from. This is not the preferred way of subsidizing the banks though. The government prefers to issue bonds which the banks (and others) buy, and then sell for a profit to the Federal Reserve private bank not but days or weeks later.

The second common myth is that our money comes from the Federal Reserve private bank. Again, they are involved in only 5% of the money creation when transacting with the government through the Treasury. This percentage has likely changed due Federal Reserve private bank creating trillions out of thin air for the bailouts, QE69 and POMO. How it has changed hasn’t yet been documented.

So, where does 95% of the money in the United States of America come from? That portion of money is loaned into existence, at interest, by the banks as the money for every mortgage and loan. This is the origination process.

Fannie and Freddie

The third myth is that Fannie Mae or Freddie Mac are involved with mortgage origination. They are institutions backed by the government that purchase mortgages on the secondary market. It specifically states on each of their websites that they are not involved with mortgage and loan origination.

The fourth myth is that Fannie Mae and Freddie Mac provide liquidity in the mortgage and loan market. Given that the money is loaned into existence for every mortgage and loan, there is no need for liquidity in the market as there is no market (because there is no product) before the loan is made. Why does money created out of thin air need a market then?

There is really something fishy with this. What happens on the balance sheets of the banks during the mortgage process? Let me show you…

The banks get the best of both worlds. An additional 100,000 is created out of thin air for the banking system, plus the liability can be claimed as an asset and sold to a government backed entity (to socialize the losses) thus pocketing the total sum of the loan on both sides. Then on top of that the banks act as the money collector for the mortgage holders thus gaining access to more money from the original loan.

In total, when a mortgage is originated, the banking system rips off the public both through inflation and claiming a liability as an asset to investors (like the government back entities).

You might be a little confused by this transaction table above. This leads to the fifth myth that the money in a bank is yours. When you make a deposit, you loan the money to the bank. To person B, the bank owes them that amount of money, but it’s not actually person B’s money. The bank uses this fact that your deposit isn’t yours any more by using it as reserve for more loans. That is to say, once a deposit is made, it’s their money, not yours.

What makes tender legal? Constitutionality

While laws exist proclaiming that Federal Reserve Notes are legal tender, it is the equality and convertibility to gold and silver that makes it Constitutional and thus legal tender.

US Constitution – Article One – Section Ten – Powers prohibited of States

No State shall… make any Thing but gold and silver Coin a Tender in Payment of Debts

Nixon Shock
The Nixon Shock

President Nixon imposed a 90-day wage and price freeze, a 10 percent import surcharge, and, most importantly, “closed the gold window”, ending convertibility between US dollars and gold

This last component is still with us today but President Nixon didn’t have the power to do this.

US Constitution – Article One – Section 8 – Powers of Congress

The Congress shall have Power To… To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures;

Currently Congress is not doing this but that is beside the point for this article. Nixon did not have the Constitutional power to change the value of money. Only Congress had and has that power.

What is so strange is that Nixon’s unconstitutional act of regulating the value of money has caused the states to act unconstitutionally in every debt case involving Federal Reserve Notes since then.

This leads to the sixth myth that Federal Reserve Notes are legal tender. There are laws defining the Federal Reserve Notes as legal tender for all debts. As the banks create money out of thin air, it is not gold or silver. Even our own government tells us that Federal Reserve Notes are legal tender. Yet not a single person has been able to tell me how this is consistent with our Constitution. Given my understanding of the fractional lending process, our debt-money is not legal tender.

The actual cash is printed by the Treasury because our Constitution states that only the government can coin money but this is a loophole used by the bankers. They issue the money, and the government prints it. This is not the intention of the Constitution. All those strict constructionist judges out there should have an easy time turning over our monetary system on Constitutional grounds, only my fear is that they aren’t really strict constructionists. My fear for this is valid: they have extremely spotty records as strict constructionists especially when you read their arguments. The conservative wing of our judicial system seems more like the corporatists wing of the judicial system.

This has huge implications though. As the mortgage and foreclosure fraud works its way through the system, the easiest and best argument to shut down the banks is that they didn’t have consideration in the loan process. That is to say, the banks never had any skin in the game for the mortgage or loan. The loan document assumes that something of value is exchanged but the money was loaned into existence. Such Judges are activist in unconstitutionally defending Corporate Personhood and so I have doubts about their interpretation of money as defined by the Constitution.

This was just fine in the fractional system when on the gold standard as when they created the money out of thin air, it was instantly backed by gold. The problem was that they didn’t add any more gold to their reserves. This forced Nixon to take unconstitutional actions to preserve the system. The banks caused the Nixon Shock. In fact, what financial crisis haven’t the banks had a hand in?

Fractional Lending

Those of us that understand how loaning money into existence works, we have seen this chart or a variant there of:

The seventh myth is that the reserve ratio defines a relationship between how much of a deposit can become reserves. This is factually false. The Reserve Ratio only has to do with how much can be loaned into existence based on the reserves. The whole deposit can be used as reserves.

Wikipedia – Money Multiplier

(The money multiplier) number is multiplied by the initial deposit to show the maximum amount of money it can be expanded to.

I have created a new table to diagram what happens when you put facts together:

We get 500 in step A as the theoretical maximum by taking the initial deposit of 100 and multiplying by the money multiplier, 5. All the following steps take the proceeding maximum and multiply by 5 each time.

Once again, there is no link between deposits and reserves. If the bank chooses, the entirety of the deposit can be reserves. The math they use in the above example is entirely misleading on the side of the banks as they imply there is a connection between deposits becoming reserves via some reserve ratio.

This is the banks intellectually misleading even the brightest economists and financial experts. The banks even encourage misleading concepts within their own bank! Thanks for showing me that Matt! I’ve had similar conversations of ignorance with JP Morgan investment bankers, Wells Fargo Advisors, Wells Fargo Home Mortgage, and 53rd. This does not bode well that our financial sector is so ignorant…. of simple financial concepts. Those of you who have gotten this far in the article. Are you still long on the financial sector?

Conclusion
With a $1 deposit, two banks can loan into existence an infinite amount of money. This also means, the banking system has the ability to loan money to itself to get out of any problem. With the kinds of reserve ratios that banks are now legally able to perform with, It has had the ability to create the money to get out of any problems which they create themselves. Now the Federal Reserve is taking on this role of printing money out of thin air so the banks can survive when it is the entire fractional reserve system that is the ponzi scheme.

Given that the only reason why Federal Reserve Notes have value is that they are limited in quantity, and inflation is all the Federal Reserve does in response to every problem regardless of whether there is too much money or too much inflation, we are in for a very hard landing of a type not experienced here in America for a long time: Hyper-inflation.

Lastly, all these arguments as to convertibility and tender can be turned around on the consumer. The banks don’t actually owe you your debt-money back because you loaned it to them and you don’t have any ability to claim that money was legal tender. If this is realized, a bank run would be inevitable and set in motion the hyper-inflationary collapse.

How loans and mortgages by banks are fraud

Revolution Not

Widespread Silver Bar Shortages

If everyone demanded physical delivery of silver, we’d be looking at $500/oz.  If hyper-inflation hits, the sky is the limit, $5,000, $10,000, who knows, but they will still buy the same amount of goods and services they buy now.  Saving metal coins is not a way to get rich. It will only preserve existing wealth while currency is devalued.

coinupdate.com

By Patrick A. Heller on November 18th, 2010
Categories: Featured Articles, Gold and Silver Commentary, Precious Metals

As of today, there are no longer any regular wholesale supplies of the 1 ounce through 100 ounce silver rounds and bars available for immediate delivery.  It may be possible to locate incidental quantities of some product, but most wholesalers are now promising two to four weeks delivery to allow time for the silver to be fabricated.

As a result of the shortages, premiums have started to rise.  So far, the increases have been modest, on the order of 0.5-2%.  However, if the shortage grows, expect to see further and larger premium increases in the coming weeks.  We could see a repeat of the late 2008 gold and silver buying frenzy, where product availability got as slow as 1-4 months after payment.

Read more…

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.

Wells Fargo banker admits mortgages create money out of thin air

Unchecked creation of new fiat money backed by no assets is at the core of this ongoing planned slide into debt slavery.  While on the surface one might assume that a house is a reasonable asset to “back” the creation of this new money, this is not how it works.

For one thing, there isn’t just one mortgage for each new house built.  A single house could have dozens of mortgages on it over the existence of the house, each time creating new fiat money and resulting in this new money + interest being paid back to the bank over the term of each mortgage.   A $100k house could be foreclosed after $90k has already been paid, giving the bank both the house AND the majority of the money they created initially (out of nothing).   They will then turn around and create yet another new mortgage and thus new money.  This in no way represents the real expansion of the economy and is obviously not a reasonable asset to back our currency.

What’s shocking is that someone actually got a banker to admit to this, and I do know for a fact this is authentic…

From Revolution Not

“The short answer would be yes (promissory notes are the backing for new money) if you look at it that way we do loan money out of “thin air”. We are able to loan money just like any other bank is able to.”

- Ryan S.  Loan Administration Manager, Wells Fargo Home Mortgage

So, the very root of what a mortgage is and how it works is based on fraud. It is unconstitutional and cannot hold up in court if one reads the Constitution, even a strict constructionist view point.

Read more…

Wellness Enforcement Officer… OPEN UP!!

“Member Engagement” health insurance turns your entire life into a pre-existing condition + Could create new bond/futures market.

On its face, this might seem like a good idea.  Why should I have to pay for someone else’s million dollar liver transplant due to alcohol abuse, or lung cancer surgery after 30 years of smoking? They ruined their own organs willfully.

Unfortunately however, the only way to enforce a “member engagement” system  will be with a new bureaucracy of “health and wellness” lifestyle investigators, monitors, administrators, and medical testing regimes to ensure compliance… to engage the member. Get it?  We’re the members. The insurance companies are preparing to engage us, so brace yourselves.

Once your private medical information is out there, you can’t get it back, and here is a perfect illustration of why it should be kept private and not shared among providers (except as authorized), insurance agencies, or the government.  This type of game-changing, rule-changing behavior by the insurance industry puts nearly everyone at risk for claims denial based on the their subjective assessment of your lifestyle.  It will open the floodgates for a new wave of denials by turning lifestyles into pre-existing conditions.  Death panels?  Of course.  But they they’ll be called wellness assessment panels or something.

If this continues, we’ll be under total nanny state lifestyle micro-management in the name of health and wellness.  It may be privatized or run by a new federal agency. Either way, mandatory health insurance with “member engagement” will have the same result.  Who do you trust, the government or the corporations?  It doesn’t matter because the corporations control the government.  They’ll be working together, to ensure compliance.  Why do you think they made all this federal grant money available to implement electronic health records, while also making it mandatory to buy health insurance?

Did you just hear her say you have to complete a BIOMETRIC SCREENING? This gets scarier every time I watch her read it off the teleprompter but let’s not get off topic.

Member Engagement could create new financial bonds, futures, and derivatives markets, and probably a lot of other smoke and mirrors gambling investment vehicles I’ve never heard of (kind of like investing our savings and retirement money in sub-prime mortgage and derivative markets then going bankrupt).  What does this have to do with me?  Stay with me for a minute…

If the Wall Street bankers can determine the investment value of owning our individual insurance policies, using health and lifestyle data, as opposed to owning group plans as a whole, it could enable the sale of financial contracts based on the health of individuals, that is how likely someone is to need a million dollar surgery before being hit by a bus, and thus whether that individual’s plan will be profitable or costly to administer.  I’m sure the investors and traders are already salivating over this.  Hey, if they can trade penal bonds (not penile), they can trade anything.

To the bureaucrats and social workers that will try to ram this system down our throats– put this in your pipe and smoke it:

I live a healthy lifestyle and rarely see doctors, which is none of your business.  I have no intention of submitting to unnecessary medical testing or sharing information about my lifestyle with you.  If my doctor thinks a procedure or treatment is reasonable and legitimate, s/he will submit a claim with the appropriate billing code. The insurance company will then pay the claim or I will sue them.   It’s obviously not a perfect system now but at least patients have the recourse of a law suit if claims are denied, and the insurance companies are forced to compete in the free market. This Orwellian new insurance model will lead to discrimination law suits if it goes where I think it’s going.