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Old 02-11-2012, 03:23 PM
 
2,024 posts, read 4,825,536 times
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They should say central bankers instead of Federal Reserve. The problem goes well beyond the Federal Reserve considering JP Morgan is the center of it anyway along with the other money center mega banks. Self anointed central bankers controlling the production of most of the people's money around the world is the biggest issue by far, everything else is just a symptom.
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Old 02-12-2012, 06:16 AM
 
Location: Fredericktown,Ohio
7,144 posts, read 4,783,460 times
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Quote:
Originally Posted by Mircea View Post
#2 The Federal Reserve System Is A Perpetual Debt Machine
As long as the Federal Reserve System exists, U.S. government debt will continue to go up and up and up.

...is blatantly false.

"U.S. government debt" will go "up and up and up" only so long as Congress continues to spend more money that it collects in tax revenues.

The Federal Reserve is a central bank and all central banks, nay, all banks on Planet Earth do the same thing, which is try to fix the mistakes made by others. You have a National Debt because your government spends more than it makes, and the only way to fix it is to sell the debt to private investors. That is nothing new. It's been happening for centuries. Ask Philip IV King of France and Navarre.
Granted the way the author worded that quote could make one believe that the Federal Reserve is running up debt. But later he states that our gvt runs up the debt constantly. He also explains that instead of issuing debt free money which our congress could do, congress chooses to pay interest and borrow money from the Federal Reserve. And that is a true statement unless they are raiding the Social Security Trust fund.
Quote:
If you want to do something about "U.S. government debt" then try turning off the TV and putting down your iPod and cell-phone for a few seconds and do your duty as a citizen.
You have me pegged wrong I do not watch TV since I choose not to have cable, do not own a Ipod {waste of money} and rarely talk on the phone. I have done my duty as a citizen, no one I have voted for has ever won a Federal seat or the Presidency. What more can I do I do not have 15 trillion dollars.

Quote:
And by the way, the idiot is too stupid to realize that there are two forms of National Debt: Non-Public Debt and Public Debt. About $5 TRILLION is "U.S. government debt" but the other $10 TRILLION is your debt, as in you personally, as in you are jointly and severally liable for the public portion of the National Debt, since you are, by definition, a "share-holder" in the Federal Reserve.
Are you trying to set a trap? the private sector is on the hook for the whole 15 trillion. We both know that gvt holdings can and will be swapped over to public debt. Like Social Security, the trust fund has been spent and when there is a deficit the gvt gets the money from the general fund to cover. And that is paid for with taxes, duties, other, or more borrowing.
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Old 02-12-2012, 04:08 PM
 
Location: Ohio
22,798 posts, read 15,943,999 times
Reputation: 19283
Quote:
Originally Posted by Swingblade View Post
Granted the way the author worded that quote could make one believe that the Federal Reserve is running up debt. But later he states that our gvt runs up the debt constantly.
Yes, later, just like a good propaganda artist would do. Herr Göbbels would be proud.
Quote:
Originally Posted by Swingblade View Post
He also explains that instead of issuing debt free money which our congress could do...
There is no such thing as "debt free" money.

Quote:
Originally Posted by Swingblade View Post
... congress chooses to pay interest and borrow money from the Federal Reserve.
And that is significantly better than any of the alternatives, not to mention less costly than the alternatives.

Quote:
Originally Posted by Swingblade View Post
You have me pegged wrong I do not watch TV since I choose not to have cable, do not own a Ipod {waste of money} and rarely talk on the phone. I have done my duty as a citizen, no one I have voted for has ever won a Federal seat or the Presidency. What more can I do I do not have 15 trillion dollars.
Then profuse apologies all around. If you are doing it, then that's all that anyone can ask.

I think the saying goes "It's hard to soar with Eagles when you are surrounded by Turkeys." Lot's of Turkeys in the US.

Quote:
Originally Posted by Swingblade View Post
Are you trying to set a trap? the private sector is on the hook for the whole 15 trillion.
Well, sure they are, but investors are not going to seize US assets, because the US defaulted on intra-governmental holdings. It's all debt, but the non-public debt can be managed much easier.

Quote:
Originally Posted by Swingblade View Post
We both know that gvt holdings can and will be swapped over to public debt.
Indirectly.

Quote:
Originally Posted by Swingblade View Post
Like Social Security, the trust fund has been spent and when there is a deficit the gvt gets the money from the general fund to cover. And that is paid for with taxes, duties, other, or more borrowing.
Quite true, and then the General Fund debt is sold. That's how it (Trust Fund IOUs) is converted from non-public debt to public debt.

Your country has a problem because it spends more money than it collects in revenues. It doesn't matter whether you have a Federal Reserve or not, or whether you call it a Federal Reserve of the National Bank of the United States, or if you change currencies, or back you currency with precious metals, at the end of the day, it all comes down to the fact that your country spends more than it collects.

That simple fact will always create economic and financial problems to varying degrees in one form or another, until you stop spending more than you have.

Monetarily...

Mircea

Quote:
Originally Posted by modeerf
Dump the FED and go back to green backs and you'll see a country rise from the ashes.
Yeah, sure, and let's totally ignore the fact that at times the Greenback was only worth $0.40.

Ooops.

Debunking...

Mircea
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Old 02-12-2012, 06:00 PM
 
Location: Fredericktown,Ohio
7,144 posts, read 4,783,460 times
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Quote:
Originally Posted by Mircea View Post
I think the saying goes "It's hard to soar with Eagles when you are surrounded by Turkeys." Lot's of Turkeys in the US.
My saying is " I'd rather stand alone then run with the hyena's" it is about the same.
Quote:
Your country has a problem because it spends more money than it collects in revenues. It doesn't matter whether you have a Federal Reserve or not, or whether you call it a Federal Reserve of the National Bank of the United States, or if you change currencies, or back you currency with precious metals, at the end of the day, it all comes down to the fact that your country spends more than it collects.

That simple fact will always create economic and financial problems to varying degrees in one form or another, until you stop spending more than you have.
Mircea
Yep and I think we have reached the point of no return or I am not savvy enough to figure it out. The only solution I see is our gvt would have to shrink way down in personal and duties and run surpluses for as far as the eye can see. I do not think that will take place with either party.

But anyways back to the OP's subject and you are on record that you do not think that point 5 is a valid one.
#5 The Federal Reserve Is Paying Banks Not To Lend Money

Once again I agree that the author does not choose his words carefully but it does not take away from the facts. The chart as you know comes from the Federal Reserve itself and it looks like the banks have 1.5 trillion parked. If I have my facts straight the banks are earning 0.25% interest, does this discourage them from making loans? I say no, if them vultures could make a 1% loan you know they would do it.
The author goes on a wild tangent here :
Quote:
But shouldn't the banks be lending the money to us so that we can start businesses and buy homes?
You would think that is how it is supposed to work.
Unfortunately, the Federal Reserve is not working for us.
The Federal Reserve is working for the big banks.
The author could have made a better point such as the Federal Reserve could have gave back more money to our broke gvt and lessened our debt.

Quote:
Historically, transfers are far smaller. In 2004, as the economy hummed, the Fed transferred just $18.1 billion to the Treasury.
In 2010, however, as the Fed raked in interest payments from new purchases of government bonds and mortgage-backed securities, the transfer hit a record $79.3 billion.
From that story the Federal Reserve payed out a extra 1B from the year previously to the banks holding money in reserve. A billion here and a billion there adds up.
Fed pays $76.9 billion from bond-buying program to government - Los Angeles Times
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Old 02-13-2012, 11:39 AM
 
19,337 posts, read 16,942,875 times
Reputation: 7515
Quote:
Originally Posted by Mircea View Post
You said...



...so then you're admitting you don't understand economics.

Great. I had a theory that stupidity begets stupidity; that theory is now a law.

This statement...

#2 The Federal Reserve System Is A Perpetual Debt Machine
As long as the Federal Reserve System exists, U.S. government debt will continue to go up and up and up.

...is blatantly false.
Mercea,


Why do the wheels come off so badly with your comments about the macro economy? We are in a credit based monetary system. Of course its a perpetual debt machine. All money is debt, not even a sublimated commodity any longer as would be gold specie. To work with the intentions most people seem to have, the total debt must always increase. Otherwise you must normalize depressions and defaults. The only expansionary valve release is more debt and the national debt as the last resort. Otherwise the weakest, and last in, must default on their principle + interest payments. It may be a minor event if banks circulate the money, but they are not stupid. They always have been shown to restrict credit to cause the markets to fall and thus artificially create more buying power.


Quote:
"U.S. government debt" will go "up and up and up" only so long as Congress continues to spend more money that it collects in tax revenues.

The Federal Reserve is a central bank and all central banks, nay, all banks on Planet Earth do the same thing, which is try to fix the mistakes made by others. You have a National Debt because your government spends more than it makes, and the only way to fix it is to sell the debt to private investors. That is nothing new. It's been happening for centuries. Ask Philip IV King of France and Navarre.
No. They finance government operations and create fungible debt that circulates as money. It is not there to "fix mistakes", otherwise the FDIC would be a redundancy. We are in a chartalist money system that has a facade of debt. We already technically defaulted in 1971 which is why the budget of Philip of Navarre is as obsolete as a buggy whip.


Quote:
If you want to do something about "U.S. government debt" then try turning off the TV and putting down your iPod and cell-phone for a few seconds and do your duty as a citizen.

And by the way, the idiot is too stupid to realize that there are two forms of National Debt: Non-Public Debt and Public Debt. About $5 TRILLION is "U.S. government debt" but the other $10 TRILLION is your debt, as in you personally, as in you are jointly and severally liable for the public portion of the National Debt, since you are, by definition, a "share-holder" in the Federal Reserve.

This particular sub-form is for serious business, investing and finance, not crap-posts from sky-is-falling religious nutter whack-job sites spewing nonsense. You and Spamwad-nee-Grandpa Pipes would do better to take this garbage to Godlike Productions or some other hack ass-hat website where it belongs with the tin-foil-hat-UV-radiation-there's-only-an-inch-of-topsoil-left crowd.

Posting....

Mircea

The source and some of the information is worthy of derision I will agree.
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Old 02-13-2012, 11:56 AM
 
3,335 posts, read 2,702,551 times
Reputation: 921
.


Quote:
Yeah, sure, and let's totally ignore the fact that at times the Greenback was only worth $0.40.

Ooops.

Debunking...

Mircea
What i would do for a currency that was truly worth .40 cents.

You like to read, here is an education on the history of American Currency.

Why a Federal Reserve Note is not worth a Dollar.
We now have a "Federal Reserve Note" which does not Promise anything, is not Redeemable on Demand in anything of intrinsic value, and which has been deemed (unilaterally proclaimed) to be "legal tender", but which is not and cannot ever be lawful money of the United States. While the current "Federal Reserve Notes" are not valid promissory notes; they may be "bills of credit".
Legally, such currency is called "scrip" or "fiat money".
In slang, such currency is called "worthless", "bogus", "fake", "funny money", etc.
What "obligation" could possibly attach to such a "Note" or to the use of such a "Note"?
I believe that, since no obligation [of Redemption in Value] can attach to the purported Issuer [the Federal Reserve Banks] or to the purported co-signers [the Treasurer of the United States and the Secretary of the Treasury] of such a "Note", no obligation could possibly attach to the first, nor to any subsequent, holder or user of such a pseudo-"Note".

Looks like Mortgage bankers did the same thing to the value of Real Property. Fake Notes, for a corrupt system.
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Old 02-13-2012, 12:39 PM
 
Location: Vallejo
16,261 posts, read 18,214,649 times
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"Why the Federal Reserve Note is not worth a Dollar" depends on the user being so ignorant they ever though the dollar wasn't fiat currency. It's been that way absolutely since '71 and really well before than. Bretton-Woods was only technically backed. Once you just go changing how much gold a dollar is worth whenever it's convenient (Bretton-Woods) is it really anything but fiat currency at that point? Not really. A dollar (federal reserve note) is not a dollar (something of intrinsic value) is shocking only if you've been sleeping under a rock for the last 50 years. I rude awakening, perhaps, for those ignorant of reality... but to everyone else? *Yawn*. We're well aware the dollar (of intrinsic value) went away long ago.

The "dollar value" of gold far out weighs it's intrinsic value anyway. Sure, there's some intrinsic value for manufacturing... but mostly it's only valuable because it's rare. You could just as easily have a currency backed with Picasso paintings or Babe Ruth rookie cards and it would be just as meaningful.
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Old 02-13-2012, 05:13 PM
 
3,335 posts, read 2,702,551 times
Reputation: 921
Quote:
Originally Posted by Malloric View Post
"Why the Federal Reserve Note is not worth a Dollar" depends on the user being so ignorant they ever though the dollar wasn't fiat currency.
Most of the world

Quote:
It's been that way absolutely since '71 and really well before than. Bretton-Woods was only technically backed. Once you just go changing how much gold a dollar is worth whenever it's convenient (Bretton-Woods) is it really anything but fiat currency at that point? Not really. A dollar (federal reserve note) is not a dollar (something of intrinsic value) is shocking only if you've been sleeping under a rock for the last 50 years.
Most of the world

Quote:
I rude awakening, perhaps, for those ignorant of reality... but to everyone else? *Yawn*. We're well aware the dollar (of intrinsic value) went away long ago.
But what about the Children? Something always to learn for each generation.

Quote:
The "dollar value" of gold far out weighs it's intrinsic value anyway. Sure, there's some intrinsic value for manufacturing... but mostly it's only valuable because it's rare. You could just as easily have a currency backed with Picasso paintings or Babe Ruth rookie cards and it would be just as meaningful.
Not really.

I'm not advocating the Gold backed Currency. I was speaking in terms of Greenbacks. Debt free money. Gold backed may be transitional, but i doubt it would ever come out of it's transition.

The future is sadly digital credits controlled by bad people.
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Old 02-15-2012, 10:53 AM
 
Location: Ohio
22,798 posts, read 15,943,999 times
Reputation: 19283
Quote:
Originally Posted by Swingblade View Post
The only solution I see is our gvt would have to shrink way down in personal and duties and run surpluses for as far as the eye can see. I do not think that will take place with either party.
I don't believe anyone will see a budget surplus before the year 2040.

Quote:
Originally Posted by Swingblade View Post
The chart as you know comes from the Federal Reserve itself and it looks like the banks have 1.5 trillion parked.
That would be one way of controlling Real Inflation.

Quote:
Originally Posted by Swingblade View Post
The author could have made a better point such as the Federal Reserve could have gave back more money to our broke gvt and lessened our debt.
All of the interest less operating costs are returned to the US Treasury. Operating costs pay for all those fancy graphs the Federal Reserve produces.

Budgeting...

Mircea

Quote:
Originally Posted by gwynedd1 View Post
We are in a credit based monetary system.
Credit has been part and parcel of economic systems since trading began.

Quote:
Originally Posted by gwynedd1 View Post
All money is debt...
All money is not debt. Money is simply a medium to expedite commerce. You can trade 50 chickens for a goat, or you can trade the equivalent amount of money for a goat, which is a tremendous advantage if you don't have 50 chickens.

Quote:
Originally Posted by gwynedd1 View Post
It is not there to "fix mistakes", otherwise the FDIC would be a redundancy.
The Federal Deposit Insurance Corporation only exists to protect private bank accounts to a specified limit.

Monetarily...

Mircea

Quote:
Originally Posted by gwynedd1 View Post
We are in a chartalist money system that has a facade of debt. We already technically defaulted in 1971 which is why the budget of Philip of Navarre is as obsolete as a buggy whip.
Quote:
Originally Posted by modeerf View Post
I'm not advocating the Gold backed Currency. I was speaking in terms of Greenbacks. Debt free money.
You both missed the entire point.

Let's see what happens when a country like Ukraine drinks the Kool-Aid and sets up a "debt-free" monetary system.

Ukraine - inflation

That is what happens when you have, um, "debt-free" money. Note the rate of Real Inflation prior to 1996 and the introduction of the Hryvnia as debt based currency.

1988 1.72
1989 3.84
1990 16.34
1991 95.62= 485%

1992 1,761.26 = 1741%
1993 3,334.80 = 89%
1994 953.46
1995 415.81
1996 66.15
1997 18.07

Highlighted in RED is the world's record for Real Inflation in a single year.

So, how many of you still think, um, "debt-free" money is a good idea?

Inflating...

Mircea

Quote:
Originally Posted by modeerf View Post
What i would do for a currency that was truly worth .40 cents.

We now have a "Federal Reserve Note" which does not Promise anything, is not Redeemable on Demand in anything of intrinsic value, and which has been deemed (unilaterally proclaimed) to be "legal tender", but which is not and cannot ever be lawful money of the United States.
Of course it can. Read the US Constitution.

Article I, Section 10: No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

We can reduce that to this for brevity:

Article I, Section 10: No State shall...coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts;...

Those are prohibitions against the States. They are powers reserved expressly and solely for the federal government. States cannot coin Money, but the federal government can.

The only thing States may accept as legal tender are gold and silver, but the federal government can accept anything it wants. It could even accept Bronze like the Romans did.

Constitutionally...

Mircea
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Old 02-15-2012, 01:22 PM
 
19,337 posts, read 16,942,875 times
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Quote:
Originally Posted by Mircea View Post

Credit has been part and parcel of economic systems since trading began.
Unless you have a synchronous barter system, the first one who gives up his goods issues credit. Thus credit is everywhere.

Quote:
All money is not debt. Money is simply a medium to expedite commerce. You can trade 50 chickens for a goat, or you can trade the equivalent amount of money for a goat, which is a tremendous advantage if you don't have 50 chickens.
Nope. And the rise of gold due to its monetary potential is just another example that annihilates this notion. Even commodity money rises above its use value. Money is of course used as a mobile hash mark of having issued a use value whereupon one is essentially issuing credit. Thus money is basically a debt.

Quote:
The Federal Deposit Insurance Corporation only exists to protect private bank accounts to a specified limit.
Again why the partial redundancy? So no, the Fed is not there to fix mistakes. Its there to finance da guberment.




Quote:
You both missed the entire point.

Let's see what happens when a country like Ukraine drinks the Kool-Aid and sets up a "debt-free" monetary system.
No such thing. If the treasury issue a coin(essentially worthless) and spends it into circulation, it will be obligated to accept back its own coin(worthless) rather than a real usable item. Its debt.

You can have interest free money which is the difference between a bond and a non interest bearing note. Thus the difference between the US "paying off" its national debt is about 2% of debt. It can of course effectively cancel its debt by jacking up taxes after issuing debt of any kind.


Quote:
Ukraine - inflation

That is what happens when you have, um, "debt-free" money. Note the rate of Real Inflation prior to 1996 and the introduction of the Hryvnia as debt based currency.

1988 1.72
1989 3.84
1990 16.34
1991 95.62= 485%

1992 1,761.26 = 1741%
1993 3,334.80 = 89%
1994 953.46
1995 415.81
1996 66.15
1997 18.07

Highlighted in RED is the world's record for Real Inflation in a single year.

So, how many of you still think, um, "debt-free" money is a good idea?
How is it that you have controlled for all the rest of Ukraine's problems? I'll answer that for you. You haven't. I know people from Ukraine and she mentioned how one can own property and not have to pay taxes. I immediately pictured a rentiers paradise and land held out of productive use. No "interest free" money can fix a rentier's paradise, capital flight, brain drain, mobs corruption, and drunkenness.
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