Question about the Federal Reserve printing money out of nothing

I have a question about the Federal Reserve scam.

If the Federal Reserve prints money "out of nothing" and "backed by nothing" then why do other countries accept the dollar and accept money bribes from the US Government, if it's essentially worthless?

Do other countries also print money out of nothing?

Do other countries know that the dollar is created out of nothing and backed by nothing? If so, wouldn't they have called them on this scam long ago? Why would they accept fake money as real money?

I'm a bit confused. Can someone explain?

Thanks.

They accepted the money because they believed we were the most reliable alternative. They believed that we would back up our money when the SHTF. They believed we had integrity. We have lots of wealth and natural resources and we used to have a decent, honorable government way back when.

I'm fairly sure China has stopped accepting it, they've moved far away from the greenback.

I can't wait for my 5 million dollar bill to come in, got to love hyperinflation.

Originally posted by WWu777
I have a question about the Federal Reserve scam.

If the Federal Reserve prints money "out of nothing" and "backed by nothing" then why do other countries accept the dollar and accept money bribes from the US Government, if it's essentially worthless?

Do other countries also print money out of nothing?

Do other countries know that the dollar is created out of nothing and backed by nothing? If so, wouldn't they have called them on this scam long ago? Why would they accept fake money as real money?

I'm a bit confused. Can someone explain?

Thanks.

They all print fiat currency, it´s supposed to be backed up by government bonds, such as treasuries. The problem is, treasuries are really just garbage them to.

Other countries accept dollars, but the "elite", or those in charge probably don´t regard paper as any real value. Gold, Silver, drug business, weapons, mining, things like that is what those who pull the strings of countries consider a store of value i suppose.

Originally posted by WWu777
I have a question about the Federal Reserve scam.

If the Federal Reserve prints money "out of nothing" and "backed by nothing" then why do other countries accept the dollar and accept money bribes from the US Government, if it's essentially worthless?

Do other countries also print money out of nothing?

Do other countries know that the dollar is created out of nothing and backed by nothing? If so, wouldn't they have called them on this scam long ago? Why would they accept fake money as real money?

I'm a bit confused. Can someone explain?

Thanks.

Have a watch of these videos, they explain the basics...











(50 mins in total which is not too long compared to others)

There are other videos that are useful to watch but I would highly recommend these videos to answer your question firstly.



[edit on 6-5-2009 by XXXN3O]

reply to post by WWu777

"Ever since gold was removed as the backing of our currency,your personal labor and property have taken gold's place as collateral for our national debt. Every time the Federal Reserve Bank creates new money, it is a claim against your labor and property. It's not a coincident that the IRS was created at the same time as the FRB. It is their agency to collect your payments against your indebtedness.

Without a sound monetary system, we become the chattel for our national debt (9 trillion dollars and counting). This represents about $30,000 for every man, women and child in our country. That's $120,000 worth of debt placed directly on the shoulders of a family of 4.We have become property guaranteeing payment to the world bankers and other nations accepting our currency."
NolanChart

Your Strawman is created for you at birth by the state and turns you into a slave. The promise of your slave labor and property is guaranteed by your strawman, That labor being tied directly to the fiat money is what gives it it's value.

We are all slaves, literally!
learn more

China continues to support us because they have been promised eminent domain (land) as collateral.

The thing is, America did a good job of tying the dollar to gold and especially Oil. The entire world has based the price of oil on the dollar, which has made the dollar very important in the world economy.

Now that other nations are ditching the dollar, you are seeing it die. It is not coincidence.

Our dollar is used for all oil transactions in the world. The agreement was reached after WW2 when America helped everyone rebuild. Now if You know this little fact then You understand why the axis of evil is evil. Sadam Hussein was trading oil for food and medicine which is a no no because its only supposed to be traded in US dollars. Now He wouldn't stop trading oil for meds hense thats the reason of the so called weapons of mass destruction. Iran created a oil bourse and wanted to trade in other currencies and thats the reason for the saber rattling. Chavez kicked out all the european bankers and ran out all the oil companies. He also started trading oil in other currencies which is the reason why he is so evil... Also the dollar is pegged to our GDP and if You increase the money supply past the GDP growth per year it causes inflation. Our GDP is shrinking big time and the idiots in power are printing up money like its going out of style so can You say massive inflation. I almost feel sorry for the Obama supporters when full fledged inflation takes hold because they won't even be able to afford squat.... But notice I said ALMOST because if they researched the primaries there was only one man that talked about this but once again the MSM labeled him a clown and a conspiracy theorist. I personally enjoyed the breath of fresh air and the honest that he inspoused but once again I get stuck with a crook because I have to share this country with a bunch of freedom hating communist wanna be's.

Federal Reserve Notes are backed by gold from OUR gold reserves. Now I know someone is going to jump me for saying that but it only applies to the FRB.
This info comes directly from the FRB. Here is the example they offered me in 2007. The government borrows $42.00 ( gold stores are pegged at $42 per oz not spot ) from the FRB. they inturn pay the BPE 7 cents per note or 28cents. 2/$20s and 2/$1s = $42.00. They lend the $42.00 to the Federal Government at FACE VALUE plus prime. In turn, by law, the Government must collateralize the loan. They can utilize about a half dozen financial instruments but most frequently it comes in the form of a gold certificate for 1oz of 9.999 pure gold. From this one example, the FRB has spent 28 cents and has received 1oz of gold, $911.00+$42.00 org loan+ interest or approximately $952.00. They can and do remit said gold certificates for delivery of gold. The gold is then lent or traded, which ever will bear a greater dividend. So for the FRB THEIR worthless inflated paper is backed by gold. It makes no difference on what or when the government spends the money. The debt is incurred at printing.
The FRB has an escape clause. Annually, any profit is returned to the United States Treasury. This must be taken on faith because we don't know what they do or the amount of earnings. They refused my request for the amount returned to the Treasury in 2006. If I wanted that info I had to contact the Treasury. By not knowing how much they made in 06 it seemed pointless to request a quote from the Treasury.
Hence, I feel it is imperative that HR1207 get more co-sponsors, get out of Committee, both House and Senate bills are closely related, It passes and is signed into law by the current President. Considering the power inherent in their capacity to manipulate the economy this may be a very very difficult task. Jackson went down this road and eventually won, but the people payed a heavy price.

reply to post by jkm1864
Your post is very informative up to the point that
it then came political,The Federal Reserve Bank does not
really give a toss who is in power,as long as they can go
on printing Dollars and charge,(a government) for the privilege
of printing those Dollars,ie; one dollar+a percentage
goes back to the FRB, happy days for them... always!
In the meantime the guy in the street will carry on
his idealism,his politics and hopes it makes a difference.

reply to post by dazbog


Federal Reserve Notes are BASED on gold's value. The U.S. no longer ACTUALLY backs the dollar with gold.

reply to post by cautiouslypessimistic
That is true,
But that also means the FRB and only them, can claw back their loan in gold bullion if they so want to,(default).
Half of the Treasury money is supposed to be at Fort Knox,
some observers speculate that Fort Knox is empty,
never mind where the other half is.



[edit on 6-5-2009 by smurfy]

The money in the near future will not be worth the paper it is printed on.

The reality is - it is JUST paper - there is no backing to the dollar of gold or any standard - the only standard now applied is the standard of printing up as much money as possible by the govt.!

There are some countries that have some gold or metals partial backing to their money. When Nixon took us off the standard in 1972 - why did he do it? Fort Knox had not had an audit since Eisenhower - did he know something we do not?

Many groups do not think there is any gold left in Fort Knox - especially since the U.S. govt. has pushed back with request of it getting audited.

Now, with this meltdown - I would expect in the near future those holding our debt (China) might start pushing for an audit of Fort Knox themselves - they might just want to see what assets the U.S. has - as a basis of backing the debt.

If no Gold there - can you imagine what the IMMEDIATE effects on the dollar would be? One day - my guess would the one dollar bill would be worth about 5 cents by devaluation. In other words - DRAMATIC and immediate result of No gold being in Fort Knox - for all of us.

reply to post by questioningall
Fort Knox belongs to the Treasury,
you seem to be confusing it with the FRB..two different entities.

reply to post by smurfy



No, I am not confusing it, there is postings above about Fort Knox and the gold there.

The conversation has also been about a gold standard.

NO where did I say the Fed Res. owns Fort Knox - I stated the information about Fort Knox. Everything is pure and simple facts.

So, don't imply I am confusing things when I posted something about a direct subject and did not imply in any way the FRB has anything to do with that subject.

China is buying T-bills - those are treasury bills - they are buying our debt through our treasury dept. not Fed Reserve (which is NOT a govt. entity in the first place - to most people's misconception).

So, really I have no clue how you misread my post when it is plain and simple without referring to what you implied.

reply to post by questioningall
Hi there,
Yes I did read the other posts including yours,
in fact both our last posts have similarities.
If I mistook what you were saying,it is because you
had said that Fort Knox has never been audited,
but officially it is audited every year,
(officially 97% which includes analysis of the gold content)
it is not an independant audit,with which many people,(including me)
do not agree with.
The FRB do not open their books to anyone,
although there is supposed to be an inspector
who is supposed to report money movements to the Government.
So you can see that there is a "technical" difference in the way the
two operate.
That is why I mistook what you were saying,
because it is a common mistake for people to link the Federal Reserve
to The Federal Reserve Bank.
I apologise for my error,but I do think you should have been a little clearer
in what you were saying re audits.
Also,you cannot tell me what I can or cannot say,
(and I was not implying anything)
as long as I stay within the ATS rules.

Originally posted by cautiouslypessimistic
reply to post by dazbog

 

Federal Reserve Notes are BASED on gold's value. The U.S. no longer ACTUALLY backs the dollar with gold.

If I am reading this correctly, you are mistaken. Our government does in fact utilize gold certificates as collateral for the fiat money printed by the Treasury and purchased by the FRB to lend back to the government. Federal Reserve notes can and are redeemable for gold ( BUT ONLY ) by other Central banks. We are obviously not allowed this option. Other then this, and the example given ( by the FRB ) in the previous post, I don't understand what you are attempting to clarify.

Nixon took the US off the gold standard back in the 1970s, so the economic hit men went to work on the Saudi royal family.

The deal they eventually struck was basically this:
The Saudis would continue to sell oil at a price in accordance with US interests
The Saudis would invest part of their oil revenues in US bonds (debt)
The US would use the interest on that debt to westernise Saudi Arabia and provide military power to keep the royal family where they wanted to be

Most crucially, the Saudis agreed to purchase the oil with dollars, thus making the dollar the world's primary currency (the only global currency being things like oil which are useful). However, some countries do not denominate their oil in dollars, one of these is Iran.

The Japanese were semi-colonised after World War Two, and purchase large amounts of US debt because the US consumes their products en masse and provides them with a trade surplus, which they use to buy more debt. In the last couple of decades the Chinese have become the premier holders of US debt/dollar currency reserves due to a similar deal at the Japanese.

However, the Chinese are now dumping their dollar reserves and seem to have stopped or drastically slowed their purchase of dollar debt. Nonetheless, other countries still buy the debt because they think it is a good investment, they believe that the US will continue to be able to grow an economy, tax its labourforce and thus make their citizens' labour the collateral for the debt. Most countries are too poor economically or technologically, or are just too unstable for it to be worth buying their debt. America is politically the most stable country in the world, except for maybe the UK (who operate in much the same way).

I believe that the Federal Reserve is a scam. If the government could lie about John F. Kennedy, the moon landings, Martin Luther King, and 9/11; I'm sure they wouldn't mind the Federal Reserve being a complete hoax or scam of some sorts.

The Money Failure

this is from an online book that is fiction; however, the explanation in this chapter related to "The Money Failure" is NOT fiction - it is just the most understandable explanation i've so far found.