Comment

Comment by John Harvel on January 9, 2011 at 4:48am

Hello Martha, I'll see if I can outline this Fed thing for you in my own crude way. This isn't a conspiracy theory. It is actually a conspiracy. It is absolutely, beyond doubt, real. It’s no longer something that might take place at some, up for speculation, time in the future. It’s happening – Now. Debt (Fed paper) money has devalued 96% since 1913. What’s left to speculate?

I'll quickly outline the Federal Reserve fiat money bubble.

Now days, if a person is not deeply into drugs or living their own pretend life, they know what a bubble is, RIGHT?. It’s easy then to see that the Federal Reserve itself, is the Granddaddy of all Bubbles and the creator of bubbles. The only question one needs ask is, “How can I best get ready for – Life After Make Believe Money”. Right? (wrong, there's better questions)

Why can't politicians control our federal debt ?

Because all our money is created out of debt . . . It is a debt money system. Got it? (see Keynesian economics)

Simply put...Our money is created initially by the purchase of U.S. bonds. The public buys bonds like savings bonds, the banks buy bonds, foreigners buy bonds and when the Fed wants to create more money in the system it buys bonds . . . but pays for them with a simple bookkeeping entry which it creates out of nothing . . . then this new Fed created money is multiplied by a factor of 10 by the banks . . . banks do the fractional reserve principle. (see the links at the bottom)

So although the banks don't create currency, they do create checkbook money or deposits by making new loans. They even invest some of this created money. In fact this privately created money has been used to purchase U.S. bonds on the open market, which provides the banks with interest, risk free, each year, free less the interest they pay to depositors. In this way, through fractional reserve lending, banks create over 90% of the money and therefore cause over 90% of our inflation. Or something like that. Oh yeah, your on the hook for all the interest paid on those government issued bonds. At least if you are a tax payer.

Are you beginning to see the problem? Your being led down the path that debt is your friend by a bunch of Keynesian madmen and con artists.  The fix is as simple as the nose on your face. Curious?

For the purpose of our discussion, when the U.S. Government needs money, they go to the Fed to borrow the money. The Fed calls the Treasury and asks them to print X amount of Federal Reserve Notes (FRN) in units of let's just say one hundred dollars. The Treasury charges the Fed 2.3 cents for each note. The Fed then lends that money to the government at face value plus interest. The government then creates a bond for the loan amount as security for the loan.

Now the government owes the private ownership of the Fed the face value of the bonds plus interest. In other words, the Fed earns interest by "loaning" that money to the U.S. government. Imagine that . . . they earn interest by loaning money which is not even theirs to loan . . . which they just created out of thin air . . . and we printed it for them? (conspiracy or conspiracy theory?) Facts are stranger than fiction sometimes.

I hope I'm making this understandable...  

So essentially every bill they "create" has a debt associated to it . . . and if the debt is not paid . . . what do you think they do?

That's right . . . They create more Federal Reserve Notes so they can loan more to the government (actually exchange for U.S. bonds) in order to pay off the debt, thereby growing the national debt even more. Huh? Wake me up! They pay off the debt with more debt? It's a bad dream!

Ok, hear it comes, the part you've been waiting for......

Instead of the treasury department printing dollars (federal reserve notes) and bonds, just print debt free dollars........... That's it.... Sound simple?

Debt Free Dollars. What would it take? an act of congress? that's what started this mess!

We can get our country totally out of debit in 1-2 years by simply paying off these U.S. bonds with debt free U.S. notes . . . just like president Lincoln issued . . . of course that by itself would create tremendous inflation since our currency is presently multiplied by the fractional reserve banking system . . . but here is the ingenious solution advanced in part by Milton Friedman to keep the money supply stable and avoid inflation and deflation while the debt is retired.

As the treasury buys up its bonds on the open market with U.S. notes (dollars), the reserve requirements of your hometown local bank will be proportionally raised . . . so that the amount of money in circulation remains constant . . . as those holding bonds are paid off in U.S. notes, they will deposit this money, thus making available the currency then needed by the banks to increase their reserves. Once all the U.S. bonds are replaced with U.S. notes . . . banks will be at 100% reserve banking instead of the fractional reserve system currently in use.

From this point on the former Fed buildings will only be needed as a central clearing house for checks, and as vaults for U.S. notes . . . The Federal Reserve Act will no longer be necessary and could be repealed . . . monetary power could be transferred back to the treasury dept . . . there would be no further creation or contraction of money by banks.

By doing it this way, our national debt could be paid off in a single year or so. The Fed and fractional reserve banking would be abolished, without national bankruptcy, financial collapse, inflation or deflation or any significant change in the way the average American goes about his business. To the average person . . . the primary difference would be . . . that for the first time since the Federal Reserve Act was passed in 1913 . . . taxes would begin to go down.

Click here: YouTube - Money as Debt - Fractional Reserve Banking - How "Money" is Created (2/5)          Part 3 is pretty interesting too.

 

Click here: YouTube - Money as Debt - Fractional Reserve Banking - Money is Debt (3/5)

Comment by Martha Carlson on January 8, 2011 at 11:49pm

I too pray we have elected freshman with courage who will inspire the few still in congress with good hearts to join them.   Also, I find the our US gov fiscal system and what the FED's do very confusing.  It sounds like John understands more than most of us.  Could our First Coast group look at another evening class to discuss and educate us on the US monetary system like we held last summer on early American history ...or is this idea to scary?  Is there even a study guide available?

Comment by Kate Svagdis on January 6, 2011 at 2:29pm

I am politically incorrect and proud of it!

Comment by Kay Ragan Durden on January 6, 2011 at 11:10am

Right on Billie!

Comment by John Harvel on January 6, 2011 at 10:25am

Hello Kurt, Without raising our debt limit our country is in default. That in it's self tells me that our government is bankrupt. It has been bankrupt. All that is unconstitutional is revocable by default. You have to decide if your going to continue to be ushered into the new world system that is being created and dictated by central banks. A country of Public Private Partnerships for infrastructure. Or, take back control of government and our monetary system from the Federal Reserve, IMF, the World Bank and the BIS. Without doing that there is no constitution and one way or another they own it all.  

 

Al Gore recently referred to US citizens as "clients". He understands it, in the hope that we don't. Congress reading the Constitution at the opening of the 112th congress is a good sign. Repealing Obamacare, like the reading of the constitution, would be just another symbolic gesture of division even though based on common sense. We need more congressmen like Ron Paul, understanding and speaking out about the root of all corruption within our government. A congress full of alcoholics would first have to stand and identify the FED as the alcohol of their addiction, before they could ever hope to beat it.

  

Money that starts as debt can never be repaid because the only money available is that which is created as debt. No matter how hard congress tries or what cuts are made, our money is still created out of thin air by banks and transferred to us as debt. The catch 22 is it will perpetuate to an infinity of ever escalating serfdom of entitlement fools in a fascist global state of regulatory madness and you will probably think I'm the one who is mad. Think about it:O)     

I would prefere total colapse over giving the Federal Resrve another day of legitimacy. Pretty scary, huh? 

Comment by Kurt D Wullenweber on January 6, 2011 at 8:23am

I believe the 112th congress should establish a Constitutional review committee and start doing decrees on the Constitutionality of ALL laws, with the final goal of defunding and repealing all that don't pass the smell test.

I would start with Obamacare. It is clearly unconstitutional and so is the Federal Reserve Act, as well as many, many others. BUt with the new Obamacare, it could be declared unconstitutional, the reasons listed in the decree, and then systematically repealed and defunded. It should be established, in the decree, that the states do have the authority if their state constitution allows it, to have healthcare of their choosing, but the US Constitution strictly forbids any such legislation.

I believe the way to win the constitutional battle is to show the left that they CAN have lot's of their programs and belief structures on the state level, in states that have majority agreeing beliefs. IF New York wants a huge dependent class, they have every right to have one. However, they have no right to force Arizona to help pay for it!

Also, it is historically clear that the precident setting SCOTUS rulings on Commerce Clause, and others, were under duress from FDR and it is clear FDR's intent was to overthrow the Constitution. Congress must find a way to revisit those decisions, establish they were made under illegal pressure from FDR and reverse them. Putting the Commerce Clause back into it's proper Constitutional perspective would immediately open many, many of the bankrupting rulings and regulations to repeal.

Comment by John Harvel on January 6, 2011 at 8:08am

Excellent! He's been trying to shed light on this for years and the TeaParty is a good conduit. People are looking for the right answers now. 

Comment by Kurt D Wullenweber on January 6, 2011 at 8:04am

John, What do you think about the Pauls' plan to audit the fed?

I think it would be a good move, to get the general public to begin understanding how the fed is simply a private banking mafia, ripping the wealth out of America.

Comment by John Harvel on January 6, 2011 at 7:55am

Thanks Billy, it will be interesting to see how serious these new politicians are. So far, I'm not hearing it. It seems to be taking on the same old lip service of reform rather than voicing radical views opposed to our current central planning system of government. I guess any reduction of bureaucracy would be good.

I'm a FairTax advocate, because of the entitlement mentality even of those in the Tea Party crowd. I'm sure I don't need to explain that. But, I'm also extremely anti-FED. Until this mutation of our monetary system is corrected, resistance is feudal.

Assuming one has a remote understanding of the Federal Reserve and fractional reserve banking. We could get our country totally out of debit in 1-2 years by simply paying off U.S. bonds with debt free U.S. notes (dollars). . . just like president Lincoln issued . . . of course that by itself would create tremendous inflation since our currency is presently multiplied by the fractional reserve banking system . . . but here is the ingenious solution advanced in part by Milton Friedman to keep the money supply stable and avoid inflation and deflation while the debt is retired.

Here are the main provisions of a monetary reform act which needs to be passed by congress:

1. Pay off the debt with debt-free U.S. notes.- (Dollars)
   As Thomas Edison put it "If the U.S. can issue a dollar bond . . . it can issue a dollar bill . . . they both rest purely on the faith and credit of the U.S. government." (the American people) Paying off the debt (U.S. bonds) with U.S. notes, amounts to a simple substitution of one type of government obligation for another . . . U.S. bonds bears interest while U.S. Notes do not. Federal reserve notes could be used for this as well, but could not be printed after the Fed is abolished as we propose, so we suggest using U.S. notes instead.

    

2. Abolish fractional reserve banking. -
   As the debt is paid off, the reserve requirements of all banks and financial institutions would be raised proportionally at the same time to abosrb the new U.S. notes, which would be deposited and become the banks increased reserves. Towards the end of the first year of the transition period, the remaining liabilities of financial institutions would be assumed or acquired by the U.S. government in a one time operation. In other words, they too would eventually be paid off in debt free U.S. notes in order to keep the total money supply stable. At the end of the first year or so . . . all of the national debt would be paid and we could start enjoying the benefits of full reserve banking . . . the Fed would become an obsolete anachronism.

    

3. Repeal the "Federal Reserve Act of 1913" and the "National Banking act of 1864" --
   These acts delegate the money power to a private banking monopoly. They must be repealed and the money power handed back to the Department of Treasury, where they were initially under president Abraham Lincoln. No banker or person in any way affiliated with financial institutions should be allowed to regulate banking. After the first 2 reforms, these acts would serve no useful purpose anyway since they relate to a fractional reserve banking system.

    

4. Withdrawal the U.S. from the IMF, the BIS (bank of international settlements) and the World Bank.-
   These institutions, like the Federal Reserve, are designed to further centralize the power of the international bankers over the worlds economy. The U.S. must withdrawal from them. Their harmless function, such as currency exchange can be accomplished either nationally or in new organizations limited to those functions.

Such a monetary reform act would guarantee that the amount of money in circulation would stay very stable . . . causing nether inflation nor deflation. Remember that for last 3 decades the Fed has doubled the American money supply every 10 years. who knows what they are doing now. That fact and fractional reserve banking are the real causes of inflation and a reduction in our buying power. . . a hidden tax. These and other taxes are the real reasons both parents now have to work just to get by.

Then money supply should increase slowly to keep prices stable . . . roughly in proportion to population growth (about 3% per year) not at the whim of a group of bankers meeting in secret. In fact all future decisions on how much money will be in the American economy must be made based on statistics of population growth and the price level index.

The new monetary regulators and the treasury dept (perhaps called the monetary committee) would have absolutely no discretion in this matter except in time of declared war. This would insure a steady stable money growth approximately 3% per year resulting in stable prices and no sharp changes in the money supply. To make certain the process is completely open and honest . . . all deliberations would be public . . . not secret as meetings of the Fed board of governors are today.

How do we know this will work ? Because these steps remove the 2 major causes of economic instability . . . the Fed and fractional reserve banking and the newest one as well the BIS. But most importantly the danger of a sever depression would be eliminated.

This coupled with the FairTax would return our economy to a production based money standard instead of fiat money based on credit with banks making it out of thin air. Without changing these factors, we're just sugar coating the inevitable.

Comment by Kurt D Wullenweber on January 6, 2011 at 7:31am

I wish I could say this in a more clear and concise manner, but I can't!! Sorry for the copy and paste, but this is an important article.

 

Un-Delegate happening in England under the National Health Service.

Congress Has to Take Back Its Unconstitutionally Delegated Powers

by Robert Tracinski

Remember the "death panels" Sarah Palin warned about during the debate over the health-care bill? Broadly, this referred to the rationing of care, in a hundred different ways, that always occurs when the government takes over a health-care system. But specifically, it referred to a provision in the health-care bill to mandate "end-of-life planning," which was viewed as government pressure to pull the plug on grandma—as was already

This provision was pulled from ObamaCare after it became controversial. But guess what? "End-of-life planning" is back anyway.

As the New York Times reports, "When a proposal to encourage end-of-life planning touched off a political storm over 'death panels,' Democrats dropped it from legislation to overhaul the health care system. But the Obama administration will achieve the same goal by regulation, starting January 1."

This is the new trend for the Obama administration. Facing a hostile Congress, they will simply make an end-run around the legislative branch of government, imposing through regulation what they cannot accomplish with legislation.

The supporters of this agenda admit they are attempting to push it through by stealth. The Times quotes a message Representative Earl Blumenauer, who sponsored the original provision in the health-care bill, sent out to his supporters.

 

After learning of the administration's decision, Mr. Blumenauer's office celebrated "a quiet victory," but urged supporters not to crow about it.

"While we are very happy with the result, we won't be shouting it from the rooftops because we aren't out of the woods yet," Mr. Blumenauer's office said in an e-mail in early November to people working with him on the issue. "This regulation could be modified or reversed, especially if Republican leaders try to use this small provision to perpetuate the 'death panel' myth."

Moreover, the e-mail said: "We would ask that you not broadcast this accomplishment out to any of your lists, even if they are 'supporters'—e-mails can too easily be forwarded."

The e-mail continued: "Thus far, it seems that no press or blogs have discovered it, but we will be keeping a close watch and may be calling on you if we need a rapid, targeted response. The longer this goes unnoticed, the better our chances of keeping it."

Isn't it nice to know that this is how vital decisions regarding your health care are now going to be made—that the new motto of our government is "the longer this goes unnoticed, the better"?

My political predictions are not always right, but I do occasionally write something that is really prophetic. In response to this latest news, I can't do better than to quote the central passage of a piece I wrote during the height of the debate over ObamaCare. This was published in the August 19, 2009, edition of TIA Daily, but it describes exactly what is happening now.

"Don't be fooled by attempts to compromise and water down this bill, because the fundamental issue is not any one specific provision in it. The issue is the very existence of the new government health-care bureaucracy it would create.

"An amusing 'live-blogging' of the health-care bill—a blogger sharing his observations as he reads through all 1,017 pages of HR 3200—has been making the rounds on the Web, and what I found most interesting about it was his description of the first 100 pages of the bill.

 

As you begin reading the actual text of the bill, you begin to notice a pattern. Roles and responsibilities of the Secretary of Health and Human Services. Commissioners. Ombudsmen. Auditors. Assistants. Departments. Commissions. You begin to realize you are reading a verbal description of a corporate organizational chart, with lengthy discussions of how these people will be staffed, compensated, replaced, and so on....

[A] lot of the sections, like 2714 and 2754, purport to discuss ensuring lower premiums. But...[I] found nothing that described specifics. Instead, there were blanket statements that it will be someone's responsibility to find a way to lower premiums.... [T]here's no discussion of how this will save money; but there are concepts thrown around about how the SecHHS will review a bunch of different options to find the best ones representative for each type of group member. Same as before: we will make healthcare affordable for all Americans by finding a way.

"This blogger is looking at the bill from the perspective of someone trying to evaluate the Democrats' promise that the bill will reduce health-care spending. But let's look at this from the perspective of simply trying to figure out exactly what the bill will do. In effect, the bill sets up an enormous bureaucracy for the purpose of regulating health-insurance in a way that will reduce health-care costs—but leaves to a future bureaucracy all of the actual, specific decisions about how this is to be done.

"In short, the fundamental purpose of this bill is not to establish a 'public option' or 'end-of-life planning' or any other specific outcome. Its purpose is to establish a functioning bureaucracy with the legal authority to regulate all aspects of health insurance and health-care spending. What that bureaucracy will actually do is a detail to be worked out later by the Secretary of Health and Human Services, or the Health Choices Commissioner, or some other executive-branch functionary.

"Is it any wonder we're afraid that our private health-insurance will be taken away because the Health Choices Commissioner decides to impose regulations that hound private insurers out of the market? Or that we're terrified of 'death panels'? What do you expect, when you create an unelected bureaucracy charged with cutting health-care costs—without ever specifying exactly what they are empowered to cut?...

"It does not matter much whether the Democrats strip out one obnoxious provision or another. Once the government takes on this newly expanded role as regulator plenipotentiary of the health-insurance industry, the power to achieve the left's entire wish list will be shifted from Congress to a new, unelected health-care bureaucracy.

"Historically, this is how Congress has given away its power, and our freedom. Congress passes a law declaring some vague and laudatory goal—'environmental protection,' say, or 'clean air,' or 'occupational safety,' or the relief of troubled assets—then Congress creates a vast new bureaucracy and leaves it to them to fill the Federal Register with tens of thousands of pages, year after year, specifying exactly how those goals are to be achieved.

"That's why it's impossible to say exactly what any of this legislation actually does. It is impossible to predict whether the Clean Air Act will be used to regulate carbon dioxide, or whether the Troubled Asset Relief Program will do any of the half-dozen things it ended up doing after Hank Paulson decided that it wouldn't actually relieve us from any troubled assets.

"So it's a mistake to think of the current legislation as a health-care reform bill. It is actually a bill for the formation of a massive health-care bureaucracy charged with the task of scheming endlessly to expand its own power.

"The only way to prevent this kind of free-floating grant of power to the bureaucracy is to prevent it from forming in the first place....

"If we don't, we can expect that every political battle over health-care from now on will be a rear-guard action to stop the new health-care bureaucracy from taking on an ever wider role, imposing new regulations and controls that were never specified or even dreamed of when the legislation was passed."

That is exactly where we are now, and that is why we need, not to reform ObamaCare, but to repeal it as soon as possible. Yet the problem is much wider and deeper, as revealed by the recent controversy over the FDA's decision to withdraw approval for the use of the drug Avastin to treat breast cancer. Limitation of patients' access to drugs based on the decisions of bureaucrats, not doctors, is part of the British "death panel" phenomenon, and it is a more immediate danger than end-of-life counseling.

And this is not just happening in health care. President Obama is reacting to the loss of his party's congressional majority by falling back on the vast and unchecked powers that have been given to the executive branch over the years. Federal agencies are declaring huge swathes of federal lands off-limits to economic development and are continuing a de facto ban on offshore oil drilling, and in the most sweeping example, the EPA has announced its first regulations on carbon dioxide.

In all of these cases, regulatory agencies are drawing on the vast "rule-making" powers delegated by Congress to the executive branch, in defiance of the very first sentence of Article I of the Constitution: "All legislative powers, herein granted, shall be vested in a Congress of the United States." In effect, Congress has unconstitutionally divested itself of these powers, shirking the responsibility given to it in the Constitution.

The highest priority of the new Congress should be to un-delegate the delegated powers, to reign in the dictatorial power they have given to the executive and to subject these assaults on our liberty to the most basic level of scrutiny required in a representative republic: open debate in the legislature. Because the way things work now is a death panel for the Constitution.

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