The Bankruptcy of the United States

So ,...let me go out on a limb here...

1-China devaluates, and drives up the price of gold thru massive purchases, to bolster their un-pegged currency, along with Euro's. Additionally they become a manufacturing center for big ticket items (auto's, etc)

2-India, becomes the IT center of the world along with engineering services. Also big gold holders.

3-Middle East, Venezuala, Russia...adopt the Euro as the trading currency for their oil productions.

4-North Korea, becomes a nuclear state, with China as their 'big-brother' ally.

5-NATO becomes useless in the world as a policeman.

6-The USA,...Burdoned by massive internal debt from it's citizens, and corporate entieties. Holding much paper currency that is hard to use and distribute (circulate), Holding very little value (metals, gold), facing increasing inflationary pressure, as well as job market instability.

Now lets say, what if the USA faced many loan defaults, from England, Russia, Isreal, and others, in succession. You know, all the countries that we loan money to. What if our Bond system is no longer liquid becouse of other international 'investment vehicles' available to investing countries. What if we held very little if any, backing to our currency.

So let me whip out this link again, as many coorolations may be drawn..

www.nex.net.au...

Not that I may suggest this as the outcome, but the current situation appears that the USD is on the edge, and hanging by a toe-nail. I offer this link to show what happenned last time we got cought between the rock and the hard place.


And this could also imply the monetary value shift, the wealth shift, and the power shift, into a completely new currency/country/pattern.


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[Edited on 1-11-2003 by smirkley]

I have not have time to study closely to all the links listed and all the material presented but have a fair idea of what is being said; however, I have saved the pages and will study them over the next vew days. But here is some immediate points:
1. Currency (cash, frn's, what you call money) represents only a small percentage of the money in circulation. The vast proportion of money in circulation is "check book" money which is nothing more than "blips" on some computer.
2. Most money is created by "fractional reserve" banking. Banks can loan up to a percent of the deposits on hand. This loan becomes a deposit and loans can be made on that which become a deposit and more loans can be made on that which becomes a deposit ....
3. If the "fractional reserve" is 10 percent (loan 90 dollars for every 100 on deposit), $10,000 of money can be created by a $1,000 deposit. Nice scheme heh.
4. If you permit "fractional reserve" banking, it does not really matter how your currency is backed.
5. If money is created with fractional reserve banking, then the economic system will always increase in debt. Indeed, under the fractional reserve system, payment of debt removes money from the system. Since the money in the system was created by loans, all money in the system must be removed to pay for the loans. But there is still debt created by the interest on the loans. The system sinks deeper into debt.
6. In a "fractional reserve" banking system, all federal taxes are a sham. The federal government could pay its obligations by simply writing checks which could be used to pay private obligations (create money out of thin air). Inflation could be controlled by requiring banks to raise their "fractional reserves" (from say 10% to 15%). Note that banks create money out of thin air by fractional reserve banking. This will never happen though beacause it would cut down the profits of those "poor" bankers and it would also underline the sham of how money is really created.
7. I have made many post showing the threat of electronic banking to civil liberties. No more need to be said except when all your financial resources can be accessed on-line then that will be a greater threat to freedom than any number of jack booted thugs.

Also I do not have a very high opinion of Mr. Bob Schultz and personally consider him no more than a grand stander.

More may come, but I grow tired of the game.

One of the weirdest things I read and this was long before 911, I was reading predictions by Dannion Brinkley and he had predicted the U.S. would go bankrupt because of a terrorist attack. I recall laughing at what a crazy prediction that was though I place value on his predicions just thought he was way off on that one, unfortunately it was not that crazy after all.

Originally posted by goose
One of the weirdest things I read and this was long before 911, I was reading predictions by Dannion Brinkley and he had predicted the U.S. would go bankrupt because of a terrorist attack. I recall laughing at what a crazy prediction that was though I place value on his predicions just thought he was way off on that one, unfortunately it was not that crazy after all.

You must be speaking of this fellow....
Some people have successfully foreseen the future

It seems, based on the claims on his website, that he has been fairly successful at seeing the events, prior to them unfolding.

I am very impressed with the research you have done on this topic. I have alot of reading to do to catch up with you, however I have found the links to be most informative thus far.
Knowledge is power, then what do we do with that power?

note: you just earned one of my 3 votes for the month, nice work.

Originally posted by NephraTari
...then what do we do with that power?

VOTE ! Vote your heart out. Do not be complacent. Vote in your Local Elections, State Elections, and Federal Elections. DO NOT vote "straight-ticket". Write and speak with your local/state, and federal representation, and tell them what it takes to represent you, and ask them if they can represent your ideals. Demand answers, do not accept excuses. Vote out, anyone that doesnt represent your beliefs or tells you one thing then does another. Write your congressman. Tell them you know how the system works, and that it is currently not acceptable. Do not let them tell you babble that it helps the schools and paves roads! Tell them you want a US currency backed by something with real intrinsic value. Ask them why Presidential Executive Order 11110 is being ignored and not applied as directed. Tell them you want them to follow the law as set forth by this order. Tell them you do not want the corporation, The Federal Reserve Bank, representing our country and it's currencies, and you want the US Government to Follow the rule of the Constitution, and mint their own coinage and currency, backed by an intrinsic value base. Tell them you want them to abolish the Electoral Vote process, and this is not effective representation of your vote. Tell them that IRS reform is not enough. Tell them that Personal Income Taxation cannot be proven legal.

But primarily....VOTE!


One vote, each person, can change the world. Shape our future. Secure our outlook and perception.

Just one vote,... each.

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[Edited on 1-11-2003 by smirkley]

There are no currencies linked to any material entity today. Why? Because the US said no. Hence, no matter how much gold China buys, their currency won't be affected. Moreover, the US is too productive to ever go bankrupt, since al it takes to repay loans is to print more money. Now, this would cause a lot of problems, but it is not a question of bankrupcy.

The real problem is that the GDP growth is fueled entirely by government spending, which means that the current account deficit is growing enormously. The tax cuts are not backed by cut government spending. Rather government spending is up.

The US should oust the current administration due to lack of interest in domestic policy and elect someone who really cares about the country!!!

Originally posted by yergen
since al it takes to repay loans is to print more money. Now, this would cause a lot of problems, but it is not a question of bankrupcy.

print more money value goes down, have to print more money because low exchange europe can now buy your assets on the cheap. because the us $ has such little buying power all imports are more expensive and your own assests belong to another country in which the products they produce will be shiped to the place where they sell for the most money.

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It occurred to me, after re-reading my posts, that it is not completely clear as to why gold is even an issue.

Why does the Euro care, or China for that matter, and how it could effect the balance of currencies in the world markets.

Until the birth of the euro, international trade was completely dominated by the US dollar. Since the end of the 19th century, the dollar was freely convertible to gold. Man had however since ages the craving to forge gold and to disconnect money from real gold. President Franklin D. Roosevelt was the first to accommodate this craving in 1933 and he retained this convertibility only for foreigners. Americans were ordered to hand in all their gold. President Nixon knew even better in 1971 and he put also an end to this convertibility, then $35 an ounce, for foreigners.

www.free-europe.org.../eu/english.p hp?itemid=56

A third, and last for the central banks, way to hide the bad consequences of their policies, was for the central banks to provide their gold to the bullion banks at the ridiculous (but with the present low interest rates, which signify therefore the death knell of this carry trade, no longer ridiculous) interest rate of 1% pro annum. By selling this gold immediately and invest the price at a higher interest rate, the bullion bank was assured to gain upon refunding the gold to the central bank. The bullion banks therefore also had an interest in keeping the price of gold low and like the hedge funds, they started indoctrinating the public by saying that gold is no longer an investment vehicle.

Since the Washington Agreement entire gold operations at international financial institutions have been shut down with more rumoured in the works. With the present low interest rates, it is senseless for the central banks to lend gold. Those low interest rates will lead within 24 months to inflation for the reserve currency, the dollar. Only this inflation can indeed lower the present debt mountain. This inflation will lead to a further increase in the price of gold which will make the refunding of the borrowed gold by the bullion banks to the central banks impossible. This will force the Federal Reserve Bank of the US of A to declare an official delivery moratorium for the bullion banks in the US of A. This political declaration in the US of A becomes then a market fact, and not a political fact, for the European bullion banks. This market fact enables them to reimburse the gold loans with paper money. The paper money which they have, are euros, not dollars. The European central banks, which have then lent out gold receive then euros instead of that gold, euros which they then keep in their reserves. At that moment, they know what to do with their superfluous dollar reserves. They buy gold with their dollars at high prices. By throwing dollars at gold, the value of the dollar drops. At that moment the dollar is broke and the euro the sole survivor and this survivor is the new world standard which takes the role of the failed (dollar) reserve currency. In the meantime the oil producing shorts will have been able to obtain all the gold necessary to refund it to the central banks, but the central banks will at that moment be satisfied with receiving euros to the effect that the oil producers will sell their oil for euro.


This is what I have been eluding to. Gold will rise, the dollar will fall, and the euro will be primary.
This is a function of the market and as a direct result of the current conditions.

In Russia, the Middle East and India, there is an increasing aversion against the dollar and is a search for a replacement under way. The present gold fever in China where individuals are since early 2003 again allowed to possess gold implies that in order to be an economic world power by 2012, China could well accede to this world standard, Freegold. At that moment only physical gold will be traded as the natural vehicle to incorporate one�s wealth, the value of paper gold will be reduced to nothing, and the value of the euro will increase quarterly upon the marking to market of its gold reserves.


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Does this mean that I have to mention NESARA yet again?!...

Originally posted by MidnightDStroyer
Does this mean that I have to mention NESARA yet again?!...

Yes and again and again,...until the American citizens begin to understand, where we are, and what must be done.

Thanks MDS for the link! (yet again)

I originally started this topic to reveal the truth about our monitary system. It has evolved into an education of the past present and future. Hopefully the learning experience, for myself, as well as any other reader, is a worthwile endeavor.

[Edited on 1-11-2003 by smirkley]

Originally posted by smirkley
United States Congressional Record, March 17, 1993 Vol. 33, page H-1303
Speaker-Rep. James Traficant, Jr. (Ohio) addressing the House:


"Mr. Speaker, we are here now in chapter 11.. Members of Congress are
official trustees presiding over the greatest reorganization of any Bankrupt
entity in world history, the U.S. Government. We are setting forth
hopefully, a blueprint for our future. There are some who say it is a
coroner's report that will lead to our demise.

It is an established fact that the United States Federal Government has
been dissolved by the Emergency Banking Act, March 9, 1933, 48 Stat. 1,
Public Law 89-719; declared by President Roosevelt, being bankrupt and
insolvent. H.J.R. 192, 73rd Congress m session June 5, 1933 - Joint
Resolution To Suspend The Gold Standard and Abrogate The Gold Clause
dissolved the Sovereign Authority of the United States and the official
capacities of all United States Governmental Offices, Officers, and
Departments and is further evidence that the United States Federal
Government exists today in name only."

Old News? Yes, Important Now...YES.
Current events, both in War, and World Finance, are setting a stage of influence, that "could" change much of the application of all monetary systems. With the advent of the Euro, and 'crisis' around portions of the world, the stage is being set for much change in economic strongholds.

The Bankruptcy of The United States
The Income Tax is Illegal
Why We Must Form a New Nation
SIXTEENTH AMENDMENT RALLY
THE OKLAHOMA PROTEST.
Meet The IRS, America's Enemy From Within
The fast is over!
Redress of grievances
Refusal of Govt Officials to answer questions
About Fort Knox Gold
"FOLLOW THE MONEY!"
Schult'z Letter to the IRS..
THE HARD FACTS NOBODY KNOWS ABOUT
Why You Should Start A Bank Of Your Own
The Declining Dollar
The Fed & Wilson
Dear We The People-Taxes
The Recalcitrant IRS
Recent IRS announcement to ban recording at appeals hearings
The 16th Amendment was not ratified! The Income Tax is therefore illegal
Reference the Money Trust Investigation conducted prior to 1913
'Tax Honesty' Forum Opens In DC
Congress has been put on formal notice
TRUTH-IN-TAXATION HEARING QUESTIONS, Part 1
TRUTH-IN-TAXATION HEARING QUESTIONS, Part 2
Restoration of Fiscal Integrity to our monetary system
The Sad Story Of The Privately Owned Federal Reserve Bank
Congressman McFadden's Speech Before the Attempts on His Life, Part 1
Congressman McFadden's Speech Before the Attempts on His Life, Part 2
Congressman McFadden's Speech Before the Attempts on His Life, Part 3
PRESIDENT JOHN F. KENNEDY
More Congressmen Respond. More of same: Insolence!
MY REMONSTRANCE - Chester L McWhorter
What is needed to restore our Nations Fiscal Integrity
A PLAN
CHIEF JUSTICE ADMITS NO FAILURE TO FILE INCOME TAX LAW EXISTS !
Together, With Force
A monetary trail---follow the bread crumbs
The Injustice of Income Tax...Alan Keyes


====================================================================

After two years of fruitless submissions, the book was published in a small edition in 1952 by two of Pound�s disciples, John Kasper and David Horton, using their private funds, under the title Mullins on the Federal Reserve. In 1954, a second edition, with unauthorized alterations, was published in New Jersey, as The Federal Reserve Conspiracy. In 1955, Guido Roeder brought out a German edition in Oberammergau, Germany. The book was seized and the entire edition of 10,000 copies burned by government agents led by Dr. Otto John.
SECRETS OF THE FEDERAL RESERVE
The burning of the book was upheld April 21, 1961 by judge Israel Katz of the Bavarian Supreme Court. The U.S. Government refused to intervene, because U.S. High Commissioner to Germany, James B. Conant (president of Harvard University 1933 to 1953), had approved the initial book burning order.

The Jekyll Island Club was chosen as the place to draft the plan for control of the money and credit of the people of the United States, not only because of its isolation, but also because it was the private preserve of the people who were drafting the plan. The New York Times later noted, on May 3, 1931, in commenting on the death of George F. Baker, one of J.P. Morgan�s closest associates, that "Jekyll Island Club has lost one of its most distinguished members. One-sixth of the total wealth of the world was represented by the members of the Jekyll Island Club." Membership was by inheritance only.

Good work, Smirkley.Far to few people know and understand what is really going on. One must understand these aspects to fully grasp the big picture. Understanding the Federal Reserve, its beginnings and true nature is one of the foundations. I would encourage everybody reading post to look as far into this matter as you can and share what you learn with everyone you know.

I know what happens when a central bank prints money, but my point was that America is not bankrupt and will not go bankrupt in the future.

There is a difference in not being solvent and being bankrupt. If you are insolvent you just don't have the cash, but you do have assets (which are not easily converted into some means of payment). This is explained as if you can't pay your mortgages on your house, the creditor will take your house and sell it. Then the creditor takes the money you owe and give you the rest. You may not have a house anymore, but you are certainly not bankrupt.

The problems with the gold standard are already dealt with and nowadays most governments have adopted a floating currency. This is because fluctuating economies need to clear the markets and this is not easily done with a currency pegged to another form of equity.

Moreover, it is common sense for a government to spread the risk of your assets in a "portfolio" of different forms of securities. If gold prices go down it means that another price is going up. If you have a well-diversified portfolio, it is virtually risk free.

To address the question of the FRB it is correct that they issue a form of debt notes. But to put this into perspective coins and notes represent no more (and probably less) than 10% of the total amount of money available. Now, this limits the power of printing money to only being an inflationary instrument.

The real issue for the dollar is weakening demand (for the the dollar). The problem is growing fast and needs to be addressed pretty soon. If these tax cuts aren't followed by cuts in government spending the whole world will suffer.

Originally posted by yergen
There is a difference in not being solvent and being bankrupt. If you are insolvent you just don't have the cash, but you do have assets (which are not easily converted into some means of payment).

Excellent point.

As of a year ago, debt held by the public totaled $2.9 trillion. Some $1.3 trillion of this, or 39 percent, was owed to foreigners. Since flows of money in and out of a country generally balance out in the long run, for every $100 in Treasury interest payments, we must export $39 worth of goods or services to make foreign interest payments. Or we can sell foreigners $39 worth of U.S. assets.

If the foreigners who own U.S. bonds all decided to sell them, the price of bonds would drop. As they converted the dollars they got from selling bonds back into their own domestic currencies, foreign exchange markets would be flooded with U.S. dollars and the dollar would weaken against whatever currencies the bond sellers wanted. They could get out of their U.S. debt holdings, but they would take a terrible bath.

www.businessweek.com...

U.S. financial obligations to the rest of the world are once again on the rise as America grows ever more dependent on foreign capital to finance its growth. Back in March, Federal Reserve Chairman Alan Greenspan noted that over the past six years, about 40% of the increase in the U.S. capital stock was financed by foreign investment, a pattern that will require an ever-larger flow of interest payments going out to foreigners. "Countries that have gone down this path invariably have run into trouble," said Greenspan, "and so would we."

My concerns would be multi-fold. Much of our debt is to foreign countries. Foreigners still see U.S. assets as better investments than other opportunities around the world. But the thought I am having is that IF the Euro becomes a viable investment vehicle, and essentially is forced to by the European Central Banks, and Oil producing countries are in a position to sell their oil for euro's, then there would be much less foreighn investment in america. The dollar would fall in value, inflation would occur, and our government would have a 30-50% drop in active purchasers of the treasury bond issues. If this is where the revenues of the United States Government are perportionatly being produced,...I would compare to your personal income,...if your boss decides to cut your pay by 40% becouse he can get a better return of labor for his money by outsourcing, you would fall into a fast spiral toward bankruptsy. If the labor market were in turmoil, you would find it very difficult to find replacement income. (analogy)

The United States is currently experiencing chronic balance-of-payment deficits with Japan. The ordinary Japanese trade surplus runs at about $10 billion a month, of which $5-$6 billion are with the United States. They consist of dollar earnings which the Bank of Japan then promptly invests in U.S. Treasury obligations. The Bank of Japan is the world's biggest financier of U.S. deficits, both in the federal budget as well as in current trade accounts, and is the strongest supporter of the U.S. bond market. If it were not for this solid support by Japan, the world's biggest creditor country, the financial conditions of the United States, the world's largest debtor, would be rather precarious.

www.libertyhaven.com... reticalorphilosophicalissues/protectionismpopulismandinterventionism/oldnew.html


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Originally posted by yergen
The real issue for the dollar is weakening demand (for the the dollar).

However, if the USD was still based upon gold instead of a "credit-based" economy, then it wouldn't matter much how little demand there is for the dollar...Currency can be more easily switched if it's actually *based upon some kind of real equity*. Without that base of equity, lack of demand for the USD could very well *collapse* the American economy. This is the whole reason the American Founding Fathers *didn't* want to let control of the American economy get into the hands of the private sector; But since the foundation of the Federal Reserve (against the Constitution), we've had to rely upon an economy that *has* no basis in *real equity*.

Your example of the person who couldn't pay his mortage & wound up losing the house; There are a lot of cases where the bank's sale of the house did *not* equal the remaining balance of the mortgage...Therefore the guy lost his house *and* bankrupt. This is how the banks do it...They leverage a *real equity* with a currency that has absolutely no backing...Therefore, they're using something that has no value to *take* something of real value away from people.

If the dollar is pegged to gold (actually, in the old days, all kinds of precious metal was used) its value must always remain the same (or not fluctuate more than a few per cent). It is important for the economy of a nation that its currency is valued properly. Also, it wouldn't take into account inflation, inflation does not end because you peg a currency, which becomes a serious problem when it sets in (look at Argentina).

The gold standard does not benefit the world nor the USA. This is why the world got rid of this system. Imagine the amount of dollars in the world. Being a world currency it is widely spread over the planet. This means that the US would have to back all of these dollars with precious metals, money that's not even in the country!!!

Furthermore, even if you back the dollar up with gold, it does matter how much demand there is. Because if you dollar is cheaper than it should be, other countries are robbing the US, where as if it is too expensive the US loses much of its exports (domestic production may be more accurate) because of an overpriced currency. You might argue that it is easier (or better) that the value of a dollar is a decision made by other authorities (than the market), but the fact of the matter is, if you have to change the price of the dollar a lot, you're right back in the system of floating currencies.

The founding fathers had the forsight to see that Money must have some kind of value attached to it.

After all we work for that money... Right?

[Edited on 3-11-2003 by websuspect]

...continue to dismiss Gold

only China and the Islamic states are interested in it, (for currency reserves & establishing the Gold Dinar)
& India is mostly buying the jewelery class of gold...

And, hey, & are you re-financed yet?
with all the extra cash of mortage refinancing,
you could buy some heating-oil contracts...
(now the hot topic of my tele-marketing nemesis)

in my view, another 'bubble' is being created...
& remember it's not the Fall that harms you...
its the Sudden Stop !!

My next house is going to have oil heat.

Check out this banner I made. Is that totaly cool or what. Its from one of my Federal Silver Certificates. Dated 1957.

Well, your founding fathers didn't have hindsight, so they couldn't see why it's a bad idea to have a fixed rate, whatever you choose to peg it to.

But considering the exchange rates market and the bond markets, enormous amounts of money are traded every day. So, in fact, any given country is subject to the conditions mentioned above. In april 2001, 1618 BILLION dollars were traded DAILY all over the world in exchange markets. It is impossible to protect a country from the effects of these volumes.

The best way is to have a floating rate where the currency depreciates when supply is abundant. This eliminates the arbitrage for the traders and stops the speculation.

If you have a fixed rate in a situation like this, speculation won't stop, the central bank will have to raise ( or lower) the interest rates to ridiculous levels, and start buying ( or selling) your currency in order to maintain the fixed rate. If they don't, your gold reserve will be too cheap or too expensive, which means that there is an arbitrage for traders to reap the fruits of.

What I'm saying is that the dollar is in a tricky situation, but if you peg it to something, things will become worse, faster than you would expect.

[Edited on 3-11-2003 by yergen]