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The Fed

The Problem is Money ..... Duh!

Submitted by Roanman on Sun, 11/02/2014 - 15:16

If you take a minute to understand how our money is created, the perversity and corruption in our system will become clear. And, when I say system, I mean our monetary system to be sure, but also our entire system of government as it functions today.

Most of our money starts out in life as debt. When the Federal Government of the United States of America decides that it needs money that it otherwise does not have, it issues debt ….. bonds.  Those bonds are sold at auction by the Treasury Department.  Much if not most all of these bonds are purchased by a group of twenty or so large, mostly Wall Street banks designated by The Federal Reserve Bank as "Primary Dealers".

Interestingly, The Federal Reserve Bank or "The Fed" as it is commonly known is not an agency of the Federal Government of the United States of America as one would reasonably expect by virtue of it's name.  It rather is a privately held institution, owned in large part by ..... wait for it ..... the "Primary Dealers.  The Federal Reserve Bank adds or subtracts money from the economy by trading government bonds with the "Primary Dealers", mostly always at a profit to the "Primary Dealers".

Purchasing bonds from the "Primary Dealers" injects cash into the economy as the Federal Reserve simply makes a journal entry into it’s own computer system for it's own account, and in so doing it deposits a sum of money which did not exist one instant before and thus some number of billions of dollars of new money is born out of thin air.  It only dies when the Fed subsequently sells those bonds back into the economy, thus drawing cash out of the economy, or when the government pays that money back by redeeming it's previously issued bonds.  In other words, that money is for the most part immortal.

The Federal Government of the United States of America then pays the required interest on this debt out of tax revenue.

Lately the Federal Reserve Bank has on occasion been buying the bonds back from the "Primary Dealers" the very next day following their original purchase by the "Primary Dealers" from the Treasury Department.  This enables these preferred banks to buy the next batch of new bonds and then subsequently resell them to the Federal Reserve Bank at another profit whenever the Federal Government of the United States of America again decides that it needs to spend some money that it does not have.  Usually, that would be tomorrow.

This is the nuts and bolts of the proceedure commonly referred to as "Monetizing The Debt".

Here is where it gets real interesting ..... at least to me.  Congress is empowered by the Constitution to “coin” money without ever having to fool around with The Fed, issuing bonds, debt or making interest payments. U.S. Constitution - Article 1 Section 8 begins as follows: The Congress shall have Power To ….. some stuff you should probably take the time to read ….. Clause 5, “Coin Money, regulate the Value thereof” ….. and then some other stuff you should probably also take the time to read.  Congress punted on that right with the passage of The Federal Reserve Act of 1913, which Act created The Federal Reserve Bank as a privately held institution.

Were the Federal Government of the United States of America or any other nation in the world for that matter, to simply make it's own entry into it’s own account at it's own bank, rather than the privately owned institution that it now banks with, there would be no debt, no sale of bonds and no need to pay any subsequent interest payments out of tax receipts.

There most certainly would be instances of inflation, which would most certainly be underreported by a legion of governmental economists kept on the payroll, in one way or another, for purposes of massaging numbers in an effort to obscure the true rate of inflation in a cynical effort to evade accountability to the American people.  BUT ..... how is any of that different from what we have today?

The hidden benefit here is of course that there would be no insider profits to be had for the "Primary Dealers”.  Which profits they are presently using for the purchase of among other things, legislation that suits their own special interests, largely to the detriment of the American people.  That last part there is just my opinion.

Were we to simply cut out the middle man by chartering a bank that is wholly owned by the American people through the Federal Government of the United States of America and let it give birth to it's own money, a lot of our problems, most notably our debt, would become a whole lot more manageable.

Doesn't that strike you as an ever so much better approach?  It certainly worked for Andrew Jackson.

 

Central Banking

Submitted by Roanman on Wed, 08/28/2013 - 10:02

 

In the year of 2000 there were seven countries whose economies operated without a privately owned central bank, they were:

Afghanistan

Iraq

Sudan

Libya

Iran

Generally accepted "terrorist" hotbeds all.

Cuba

North Korea

Those well known human rights abusers.

 

Today, thanks to the yoeman efforts of both the Bush and the Obama administrations on behalf of the world's central bankers, only three remain:

Cuba

North Korea

Iran

 

It doesn't take much reading up on this stuff before pretty quick you come across the Rothschilds, Khazarian vs. Abrahamic Jews, Synagogue of Satan stuff, the Rockefellers, Trilateral Commission, the Bank for International Settlements, Bilderbergs and The Council on Foreign Relations etc., all of which completely saturates this conversation.

And, all of which, while fun and most likely mostly true, completely misses the point.

That point being, why on earth would any nation put it's national bank and thus it's supply of money in the hands of privately held interests rather than in the hands of a democratically elected or governmentally appointed body, and thus provide public oversight of the peoples money?

The reason is obvious, ... at least to us ... a privately held central bank enriches banks and bankers, or in other words, the Rothschilds, Rockefellers, denizens of The Council on Foreign Relation, Trilateral Commission, Bilderbergs, Bank for International Settlements, Goldman Sachs, JP Morgan and the other Primary Dealers, all at the expense of ordinary citizens. 

You can think and think and think and think and think and think and think and think and you will not come up with a system for funding your government that is more damaging to the average citizen.

I don't care what it is that you care about when it comes to politics, whether you are of the right or the left, liberal, conservative, socialist, communist, libertarian, anarchist, ambivalent or just plain disgusted, there is absolutely no possibility of achieving anything of your dreams for your nation until the money supply is ripped from the hands of the privately owned central bankers and vested with your nation's citizenry.

Where it obviously, will undoubtedy, absolutely and damn near immediately go FUBAR ......... but FUBAR in most of the world's economies lately, rates as a significant improvement. 

Until people seize control of the supply of their money, it ain't their country.

They are simply tenants or indentured servants or in the term of the day, "debt slaves".

Because ..... If it ain't your money, it ain't your country.

 

Charts upon charts upon charts upon ..... and a couple cartoons.

Submitted by Roanman on Fri, 09/14/2012 - 18:46

 

 

In 1977, Congress amended The Federal Reserve Act, stating the monetary policy objectives of the Federal Reserve to be as follows,

"The Board of Governors of the Federal Reserve System and the Federal Open Market Committee shall maintain long run growth of the monetary and credit aggregates commensurate with the economy's long run potential to increase production, so as to promote effectively the goals of maximum employment, stable prices and moderate long-term interest rates."

The notion that the Fed is tasked with promoting maximum employment and stable prices is what is frequently termed the Fed's "Dual Mandate".

Having failed miserably throughout the entirety of it's charter (1913) to maintain stable prices, as the decline in the value of the dollar equals increased prices for everything other than a dollar.

 

The purchasing power of the dollar 1792 - present, dotted lines signify those periods when convertability to gold was/is suspended.

 

The Fed decided this week that they better address their almost equal fail with regards to maintaining full employment, on account of the following.  

Things are not going swimmingly in Detroit.

 

 

 

Purchasing managers all over the world are backing off ... numbers below fifty for the Purchasing Managers Index signify economic contraction.

 

 

 

Here's where Clint Eastwood gets his number for unemployment.

 

 

 

The employment to population ratio pretty much sucks.

Although it may be forming a bottom ..... one hopes.

 

     

 

What's up with this?

That's the new economy at work ..... so to speak.

Service jobs are what we do around here now days.

 

1948 to the present.

 

Dirty manufacturing is out of favor, construction is smashed.

Look closely here, these are total numbers not percentages.

Adjust this horror story for population growth and think it through.

In our opinion, you are looking at the single most profound unintended consequence of kneejerk green/liberal/progressive othodoxy of them all.

 

 

 

As a result, Labor's share of GDP is at historic lows as all those new bartender jobs just don't pay.

 

 

 

It gets worse if indeed small business is the engine of job creation.

 

 

 

This next one suprised us as we would have guessed the suffering extended across all age groups.

 

 

 

College just may not be that ticket to a better life.

 

We can't find the piece that defined the word young in this chart.

 

 

The most common complaint with regards to inflation ... at least among those that that we hear ... has to do with the increasing price of medical care.

The price inflation of a college education blows medical inflations's doors off.

As a result, total student loans exceed credit card debt for the first time in history.

As an aside, student loans can't be extinguished in bankcruptcy since the Consumer Bankruptcy Reform Act of 1998.

 

       

 

Not to worry, those scamps on Wall Street and in Washington are getting theirs.

 

    

 

 

Speaking of Washington, the next time one of those highly paid professionals at the Congressional Budget Office whips out a projection in your vicinity, just reach out and slap that bastard.

 

 

Speaking of bankruptcy.

Coming to a country near you?

 

 

Evidently the cartoonist here is not crazy about economist Paul Krugman.

 

  

 

On a completely different subject, from John Cole.

 

 

   

Professor Bill Black tells it like it is ... was

Submitted by Roanman on Fri, 03/23/2012 - 17:27

 

The following is Professor William Black's testimony to the House Financial Services Committee's hearing on the failure of Lehman Brothers in 2008.

Professor Black's qualifications which are about as long as your right arm, can be found here.

 

 

The following is an interview with Professor Black on the street in New York City during the Occupy Wall Street happening this past fall wherein he discusses having put over 1000 banksters in jail during the 1980's Savings and Loan meltdown, and the cause (not causes) of our present issues .....

FRAUD.

Very good stuff, you should watch it.

 

 

If you like Professor Black, here's his interview with Bill Moyers who is one of the only mainstream journalist paying any attention to the pervasive corruption that is Wall Street and Washington DC.

 

To quote President James A. Garfield ... about two weeks before his assassination.

Submitted by Roanman on Wed, 03/14/2012 - 07:19

 


 

 

 

The assassination probably has nothing to do with the quote, I was just pretending to be the Freep.

Click this here little gear here for the story of one of the more interesting trials in American History, that of Charles Guiteau for the murder of President James A. Garfield wherein he admitted to the shooting but claimed innocence for the murder, pinning Garfield's death on lousy doctoring.

He might have had a point there.

Click this here little gear here for a photgraph of Mr. Guiteau's brain in a mason jar ..... seriously.

Clearly, Mr. Guiteau's defense was unsuccessful.

 

Historic Interest Rates

Submitted by Roanman on Sat, 01/07/2012 - 07:16

 

From Bianco Research who claim "more than 300 institutional clients worldwide including official government agencies, central banks, public and private pension plans, institutional money managers and hedge funds".

Which claim has caused me to never bother pricing them out.

Take note of the year 1916 which incorrectly holds the line marking the creation of the Federal Reserve Bank.

The New York offices of which are the official summer home of Satan himself and the source of all evil in this world.

The Federal Reserve Act was voted into existence December 23, 1913.

Click on the chart if you have an interest in pricing out Bianco Research, someone around here might partner up with you.

 

 

Take a hard look at 1940 through 1984 if you own or are planning to own bonds anytime soon.

The value of your bonds rise as interest rates fall, and subsequently fall as interest rates rise.

 

 

What I keep sayin' ..... still

Submitted by Roanman on Thu, 11/03/2011 - 07:40

 

The following is taken directly from the Resource Center at the Treasury Department.

 

Who/What is the Treasury Borrowing Advisory Committee (TBAC)?

 

The Treasury Borrowing Advisory Committee ("Borrowing Committee”) of The Securities Industry and Financial Markets Association (SIFMA) is an advisory committee governed by federal statute that meets quarterly with the Treasury Department. The Borrowing Committee’s membership is comprised of senior representatives from investment funds and banks. The Borrowing Committee presents their observations to the Treasury Department on the overall strength of the U.S. economy as well as providing recommendations on a variety of technical debt management issues. The Securities Industry and Financial Markets Association does not participate in the deliberations of the Borrowing Committee.

 

Treasury Borrowing Advisory Committee Members

CHAIRMAN

Matthew E. Zames
Managing Director
JP Morgan Chase
383 Madison Avenue
New York, NY 10179

VICE CHAIRMAN

Ashok Varadhan
Managing Director
Goldman, Sachs & Co.
200 West Street
New York, NY 10282

 

Curtis Arledge
Vice Chairman, CEO, Asset Mgmt.
BNY Mellon
One Wall Street
New York, NY 10286

Richard A. Axilrod
Managing Director
Moore Capital Management, Inc.
1251 Avenue of the Americas
New York, NY 10020

Ian G. Banwell
CEO & CIO
Round Table IMC
214 North Tryon Street
Charlotte, NC 28202

Jason Cummins
Managing Director
Brevan Howard
1776 I Street NW
Washington, DC 20006

Dana Emery
Executive Vice President
Dodge & Cox
555 California Street
San Francisco, CA 94104

Paul Tudor Jones II
Co-Chairman & CIO
Tudor
1275 King Street
Greenwich, CT 06831

Walter J. Muller III
Chief Investment Officer
Bank of America
600 Peachtree Street
Atlanta, GA 30308

Jeffrey S. Phlegar
President
Alliance Bernstein
1345 Avenue of the Americas
New York, NY 10105

Ruth Porat
Executive VP, CFO
Morgan Stanley
1585 Broadway
New York, NY 10036

Stephen Rodosky
Managing Director
PIMCO
840 Newport Center Drive
Newport Beach, CA 92660

Stuart Spodek
Managing Director
BlackRock
55 East 52nd Street
New York, NY 10055

Richard Tang
Head of Fixed Income Sales, Americas
RBS
600 Washington Boulevard
Stamford, CT 06901

Stephen A. Walsh
Chief Investment Officer
Western Asset Mgmt. Co.
385 East Colorado Blvd.
Pasadena, CA 91101

 

Now, here's the question you gotta ask yourself.

Who's interests are being discussed when the Treasury Borrowing Advisory Committee meets with the Borrowing Committee.

 

 

Which of course, is what I keep sayin' ..... still.

If anyone can figure out the signature on the cartoon, I'd like to link it to the source.

 

 

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