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Also you say this happened after WWII, so why then did we pay down nearly all of our WWII debt in the decades after the war?
We were still on the gold standard. The U.s left the gold standard in 1971, and became a fiat currency. Bretton Woods is not the same system as the current Dollar Standard. If you look at any graph since 1971, U.s Debt has exploded, and it's entirely by design.
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Also your assertion that it's all well and good that our credit rating drops is pretty outrageous too. So what, the whole world's credit rating including ours is just going to keep dropping forever? The whole planet is going to have bad credit but everything is going to be okay?
If I am considered fat, and pack on 20 pounds, but everyone else around me packs on 20 pounds what has changed? Our proportions are still the same, in fact you may conclude that I'm not any fatter at all. Currencies float against eachother--mainly they float against the dollar because it's the standard. When the U.s spends like drunken sailors, it gives the rest of the rich countries politicians the ability to do the same....as long as they devalue in unison, what's changing?
If we devalue the dollar, other countries devalue their currencies because they need to protect their domestic economy IE their exports to us.
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Also ridiculous is the idea that the federal reserve is doing all of this without anyone on Capital Hills knowledge and possibly even the president.
You assume that it's being done without their knowledge. The Congress authorized the Federal Reserve in 1913.
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The bottom line is that Congress and the banking cartel have entered into a partnership in which the cartel has the privilege of collecting interest on money which it creates out of nothing, a perpetual override on every American dollar that exists in the world.
Congress, on the other hand, has access to unlimited funding without having to tell the voters their taxes are being raised through the process of inflation. If you understand this paragraph, you understand the Federal Reserve System.
That means all the American dollars in the entire world are earning daily and compounding interest for the banks which created them. A portion of every business venture, every investment, every profit, every transaction which involves money -- and that even includes losses and the payment of taxes -- a portion of all that is earmarked as payment to a bank.
And what did the banks do to earn this perpetually flowing river of wealth? Did they lend out their own capital obtained through investment of stockholders? Did they lend out the hard-earned savings of their depositors? No, neither of these were their major source of income. They simply waved the magic wand called fiat money.
The flow of such unearned wealth under the guise of interest can only be viewed as usury of the highest magnitude. Even if there were no other reasons to abolish the Fed, the fact that it is the supreme instrument of usury would be more than sufficient by itself.
The Mandrake Mechanism by which the Fed converts debt into money may seem complicated at first, but it is simple if one remembers that the process is not intended to be logical but to confuse and deceive. The end product of the Mechanism is artificial expansion of the money supply, which is the root cause of the hidden tax called inflation.
Last edited by Thatsright19; 01-13-2012 at 07:41 AM..
The strong dollar relies on a strong military, and a strong military relies on a strong dollar. The U.s will remain the world's reserve currency until the day the OPEC agreement put into place in 1971 comes to an end. We left the gold standard, but entered the oil/dollar standard; a resource far more important in the modern world.
Every country that is worth a damn needs oil. The way to buy Opec's oil is to get dollars. Other countries get dollars by exporting to the U.s. IE keeping their currency artifically low.
Basically, the United States created "globalism" to dollarize the world. We make dollars (paper) and everyone else makes things (real goods/resources) that dollars can buy. From us having an (intentional) trade deficit, the other countries would build up dollar reserves. They would then invest these reserves in U.s treasuries, which allowed us to consume more (with intentional budget deficits). This setup created even bigger trade deficits...which meant more dollars floating out. Bingo. You guessed it. Foreign central banks needed to hold even more reserves (to prop up the dollar and keep their currencies low to maintain their export based economies). We were more than happy to supply the budget deficit and extra consumption. This loop has been keeping the U.s artifically doped for nearly 4 decades like the article above outlines. It was a form of colonizing the world more slick than the British could have ever dreamed of.
Your position on this issue is ridiculous and completely ignores the fact that it is unsustainable and that the longer we continue like we are the worse things are going to be later on. Also ignores the fact that we have racked up more debt in the last three years than any other three year period yet our economy is in the dumps, so evidently this system of yours isn't working very well.
The money we're borrowing is basically free. Interest rates the federal government are borrowing at are amazingly low, which you guessed it....is set low by the Federal Reserve. If the Federal reserve and the government keep inflation above this interest rate in the coming decades.....they are borrowing for free in real terms.
American debt to GDP isn't even at 100%. Japanense debt to GDP is over 300%...and Japan and the Yen are fine (and they aren't even THE king reserve currency). If over the next 5-8 years, the American economy returns to GDP growth (off the cheap...and eventually free money we just CREATED----DEBT IS MONEY AND MONEY IS DEBT), our ability to service the debts will improve. Either way, we pay dollar debts in dollars only we can produce.
Last edited by Thatsright19; 01-13-2012 at 07:52 AM..
The money we're borrowing is basically free. Interest rates the federal government are borrowing at are amazingly low, which you guessed it....is set low by the Federal Reserve. If the Federal reserve and the government keep inflation above this interest rate in the coming decades.....they are borrowing for free in real terms.
American debt to GDP isn't even at 100%. Japanense debt to GDP is over 300%...and the Yen is fine and Japan is still a first world nation. If over the next 5-8 years, the American economy returns to GDP growth (off the cheap...and eventually free money we just CREATED----DEBT IS MONEY AND MONEY IS DEBT), our ability to service the debts will improve. Either way, we pay dollar debts in dollars only we can produce.
Except, once we lose our reserve currency status and then are left holding the bag for trillions and trillions of dollars in debt. Which will happen one day.
Trillions and trillions of dollars of debt that can be repaid in our own currency. If they refuse to accept dollar as payment for debt, the debt no longer exists. "Legal tender for all debts public and private".
Also, what major country is going to be the one to throw away the dollar system(that's mutually beneficial in most cases)? Britain? Germany? France? They're all involved in the con game. Will it be China? Do they risk cutting themselves off from oil, the american consumer market, and destroy the value of their reserves?
You see what happens when Countries like Libya, Iraq, and Iran try and break away from the dollar system. Sanctions, CIA, Wars, ect.
What's going to replace the Dollar? The Euro? It's having huge problems and may break up entirely.
You vastly underestimate the grip of the Dollar system. Look at it having the market share of a company like Coke Cola----if their was no true rival like Pepsi. Do you see Coke losing its grip to a bunch of rag tag little companies? The dollar is the best recognized brand in the world, and it has a military machine and money creating machine (the FED) standing behind it.
It will not go down easy.
The American empire either continues with us winning and everyone else winning less....or we lose....and everyone loses as well.
Last edited by Thatsright19; 01-13-2012 at 08:08 AM..
Debt is money and money is debt. The U.s economy took a terrible hit from a decline in GDP of about 6%. Can you imagine the hit to our GDP if you start sucking 1 or 2 trillion dollars of government spending out of our 15 trillion GDP? Triple or quadrouple the effects of the recession/deflationary spiral we are seeing now.
But the Federal Reserve (I hope at least) learned from the mistakes of the great depression. Hense you see them doing everything imagineable to try and contain this deflation.
Interest rates are low, so as to allow more debt creation (VIA U.S Government debt) and return to the boom cycle. Debt is money and money is debt.
I never look at what either political party has to say. I look at what the FED chairmen is doing and saying---or not doing and not saying. That speaks volumes to me.
Debt is money and money is debt. The U.s economy took a terrible hit from a decline in GDP of about 6%. Can you imagine the hit to our GDP if you start sucking 1 or 2 trillion dollars of government spending out of our 15 trillion GDP? Triple or quadrouple the effects of the recession/deflationary spiral we are seeing now.
But the Federal Reserve (I hope at least) learned from the mistakes of the great depression. Hense you see them doing everything imagineable to try and contain this deflation.
Interest rates are low, so as to allow more debt creation (VIA U.S Government debt) and return to the boom cycle. Debt is money and money is debt.
I never look at what either political party has to say. I look at what the FED chairmen is doing and saying---or not doing and not saying. That speaks volumes to me.
So are you somehow involved in the finance? Or do you read all this in a book somewhere?
And more importantly IYO if we lose our reserve currency status, do we only lose our control of the world or do we lose everything including the country itself.
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