How the Central Banks Acquire ALL The Wealth

Imagine a country that prints its own money. In comes the Central Bank salesman who offers stability in an unstable world. This feat requires that the central bank control the money supply. To avoid a more blatant exposure of the theft Country A is, of course, allowed to keep its current money supply, but any additional money supply comes at a cost: interest. I wish I had the tools to do a video presentation, but instead I must make it numerical. The total amount (aggregate supply) isn't particularly relevant since it's a percentage issue anyway. Trillion, billion, whatever, it all works in the same manner.

Country A starts out with 100% of its original money supply
Country A suddenly requires more money (any number of reasons, but we'll use war since it's most dire)

Country A borrows 1% more on top of its currently supply.
Country A pays back 1.05%, making its current money supply only 99.95% of what it started out with.

Country A now claims additional citizen services are needed, and another war ensues.
1% + 1% are now borrowed, plus the 0.05% needed just to sustain previous cost requirements.

2.05% is paid back, plus 0.1025% to cover the interest.

We have now dwindled the original money supply down to 99.8475 - not because the government spent more than it had, but because it borrowed from a third party rather than "borrowing from itself" or just self-inflating its money supply.

Country A now must borrow 0.1525% just to get its original 100% money supply level in order to maintain the same operation level at the 100%. Each time money is borrowed the original pool is reduced and more money must be borrowed just to sustain previous operational levels.

Even at this pace all of the original money supply will become the property of the Central Bank. However, this pace is tediously slow. There are ways to speed this up:

• Inflation - by reducing the value of the currency the amount of money required to maintain current operational levels increase, requiring even more money be borrowed AT INTEREST, compounding the decay of the original supply.
  
• War - since war is a life-or-death game it's easy to convince the populous and legislature that additional funds are required in order to deploy sufficient force to win the war; this tool works fantastically to increase the rate of decay of the original money pool as war is incredibly expensive.
  
• Growing government - More things must be handled by the government because things are not working properly or well enough. Even if said failures are within the government itself illogical requires that more of the same must be the solution. Growing government requires borrowing more money, and in a debt-based monetary supply system this accelerates the decay of the original money supply.
  
• Fractional reserve - A magnificent double-edged sword. This allows banks to create their own money at the agreed upon rate. It improves the economy in the short term, inflating it at magnificent speeds - a blinding effect given the appearance of generating wealth. But every dollar created by this system belongs to the banks as it's loaned out but eventually it must be paid back to the banks, inflating their wealth at an incredible pace, but also shrinking the original money supply because each dollar loaned out, even if created by the fractional reserve system, must be paid back with interest. A 1/10 fractional reserve rate drains the original money pool by 10X the interest rate due to the fractional reserve money created within the banks' wallets.
  

Granted there is positive progress still made by Country A, however the negative drain far outweighs the positive accumulation. This is the ponzi, or pyramid, scheme that has our debt accelerating and our wealth, or equity, dwindling. It's true that in the short term of each inflationary pump the economy gets a boost, but the long term requires the funds provided be returned - with interest. This is what Thomas Jefferson was referring to in the following quote:

"If the American people ever allow private banks to control the issue of their money, first by inflation and then by deflation, the banks and corporations that will grow up around them, will deprive the people of their property until their children will wake up homeless on the continent their fathers conquered."

The inflation is the money pump, inflating through borrowing and fractional reserve banking. The deflation is the recollection of this money compounded even further due to interest.

IMO the counties of the world should declare war on the IMF and the world bank, Federal reserve and not on each other or there country men. Trade and barter should become the normal. A bushel of wheat for a equal amount of coffee or what ever the product. The bankers rule the world financing war for profit, killing millions!

Someone's been watching zeiguist films

Nice explanation. I think I am on the same page in understanding this, but see if we are.

I understand the bank to work as follows.

The bank creates 100 dollars, and then sells it to the state with interest. This means the state now owes 101 dollars for the newly created 100 dollars. You describe is as the banks taking over the existing money. I think of it as creating new money that can never be repaid because there is not enough money in existence.

If the bank keeps creating money, and the state keeps buying it at interest eventually the state has to be completely in debt to the bank. Once the state is so in debt to the bank it will reach a point where the new debt is impossible to pay. The public treasury will then owe the bank forever because there can never be enough money to pay the debt.

Am I understanding this correctly?

Our economy cannot be blamed on the people. The people can only work, they have no control over interest rates, bank lending, corporations, or government.

These problems are an unavoidable consequence of two things: compound interest and fractional-reserve banking. Under these systems, foreclosures and unemployment are inevitable.

Here are some unknown facts that shock most people who think they know anything about economics:

1) The Federal Reserve is a private, for-profit corporation just like Federal Express is. It's not part of the government.

2) The Federal Reserve is a cartel of banks who own a monopoly on our credit-creation mechanism and money supply.

3) The cartel is the only entity the people of the United States can turn to when we need money for commerce.

4) That money we get from the cartel is never given away, it is LOANED to us out of thin air.

5) They create their money for loans through a mechanism called "fractional reserve banking" which allows them to create counterfeit money and declare it legal tender. There is no limit on how much of this debt-money they can create.

6) The amount the cartel creates is always less than the people owe back to them, because of compound interest.

7) If there were no debt, there would be no money at all. This is because after 100 years of expanding the money supply by the fractional-reserve mechanism, the only money that exists anymore is all owed to a bank, plus interest. If we paid it all back, the banks would eat it up to zero their books out, but we would still "owe" more.

8) The national debt is not the United States owing the United States. It's the people of the United States owing the banks for fraudulent debt created out of thin air through fractional reserve banking.

9) It is numerically impossible to pay the national debt.

10) Compound interest is an exponential mathematical function, which means eventually the interest gets so large that it will be completely impossible for the population to even pay the interest on the national debt, not to mention the principal.

11) This scenario has happened before, and it always leads to hunger, crime, poverty, foreclosures, corruption, and war.

12) The last time the United States paid off its debt was under the administration of president Andrew Jackson. He understood how the banking system worked, and commented: "If the American people only understood the rank injustice of our money and banking system - there would be a revolution before morning." He paid back the debt to the Second Bank of the U.S., and denied an extension to its charter. Andrew Jackson's tombstone proudly displays the words: "I killed the bank."


The truth is that no matter how how trustworthy, hard-working, talented, and reliable everybody is... somebody is going to lose their home from foreclosure or file bankruptcy. There is even a mathematical formula for it. It's like a game of musical chairs. If there are 10 people in the economy, but only 9 chairs, 1 person will be left out, no matter how hard everybody tries to stay out of financial trouble.

The reason for this is that since all of our money comes from being loaned by the central bank, and they want it back (and then some) ... where does the interest come from? The answer is that the loan+interest cannot be paid back because the interest money was never created. This creates the problem.


--- It can all be solved by solving 2 major fundamental flaws in our system. Get rid of compound interest and fractional reserve banking. Replace them with a public credit system where you borrow from a public bank at zero interest, only paying a fee to process the paperwork. It would be like borrowing a book from a public library. Our "credit scores" would cease to be mysterious and would have meaning in the new system because it would all be public.

Private banks have profited and been parasites on the working people of the world for far too long.

Stop blaming the victims of the most colossal crime ever perpretrated on humanity and turn your eyes to the people who caused this: THE BANKS!



Google: Fractional Reserve Banking

Video: Money as Debt, Fiat Empire, Monopoly Men, Zeitgeist, Freedom to Fascism, The Money Masters, The American Dream, The Secret of Oz

Originally posted by stephinrazin
Nice explanation. I think I am on the same page in understanding this, but see if we are.

I understand the bank to work as follows.

The bank creates 100 dollars, and then sells it to the state with interest. This means the state now owes 101 dollars for the newly created 100 dollars. You describe is as the banks taking over the existing money. I think of it as creating new money that can never be repaid because there is not enough money in existence.

Correct on both counts. Since the bank came along at a point where a significant money pool already existed then siphoning the entire nation's wealth had a path to take instead of being theirs from the beginning so the impossibility was only a matter of time...and that time looks to be very near (now by some folks' argument).

If the bank keeps creating money, and the state keeps buying it at interest eventually the state has to be completely in debt to the bank. Once the state is so in debt to the bank it will reach a point where the new debt is impossible to pay. The public treasury will then owe the bank forever because there can never be enough money to pay the debt.

Am I understanding this correctly?

Exactly the point I was working for.

reply to post by 30_seconds



Very well written and I thank you. The system needs to be changed or we are all doomed. Maybe not today or the next but I it will happen.

I think the governments should print their own money and pay back the central banks with that.
Hell they do it, why not our governments who should be printing and coining it in the first place.
The only problem is, is that they have been given the right by governments past to rip us off and make out like bandits doing it.
Rich, influencial people sucked us in and became friendly with politicians because they wanted more money and power.

Anyway, it is all so stupid, they make money from nothing, we buy three houses and get only one or lose the whole house or car if we default on the remainder. What about the money already paid?

EX;If I buy 20 widgets on loan for $200.00 plus 10% monthly interest and I pay off $100.00 + $120.00 interest, then I run out of money, is it right that I get all 20 widgets taken away from me and sold for $150.00?
$100.00 + $120 + $150 = $370 for the bank, while I get nothing for all my sweat and tears even though 10 of those widgets should be mine in a logical rightious world.

They create loan money from a ledger book.
I EARN money to pay loans by my sweat and toil over time, and can lose it all.

The bank will always win. And we will be their slaves.

It's just not right!
What gives them the right?

Oh yeah, politicians.

First things first in Libya - establish a Central Bank for "proper" control and acquisition.

uruknet.info...

Also recall General Wesley Clark's statement regarding the 7 mid-east nations the USA put into the gun sights just after 9-11: Iraq, Libya, Syria, Sudan, Somalia, Lebanon, & Iran.

reply to post by Nefarious

Meanwhile the Bankers require that the countries collateralize their debt with their natural resources and the infrastructure that they are developing. And if and when they cant pay the loans back...guess what the bank owns?
Read some of the book, Confessions of an Economic Hitman,

reply to post by CosmicCitizen


The economic hitman are a very important factor. This "shadow money" created by the fractional reserve system is exported as a reserve currency and exploited for the purposes of those very hitmen. It's another double-edged sword. The mainland USA appreciates the currency export as it reduces inflation for if that multiplied currency were to be injected directly into our own markets inflation would be a monster so big the majority may actually do something about it. Two birds, one dollar.

Originally posted by waterman
IMO the counties of the world should declare war on the IMF and the world bank, Federal reserve and not on each other or there country men. Trade and barter should become the normal. A bushel of wheat for a equal amount of coffee or what ever the product. The bankers rule the world financing war for profit, killing millions!

The only way I see out of this mess is exactly that. Our armed forces need turned on the border-less thieves who would steal the very ground and lives beneath and around us. Take them into custody and release every stinking document found. It will hurt in the short term, but the long term will shine again.

theeconomiccollapseblog.com...

#5 The Federal Reserve is a perpetual debt machine.

As mentioned above, the U.S. government is enslaved to debt.

So how did it get enslaved?

Well, instead of printing up and spending the money that it needs, the U.S. government borrows it through the Federal Reserve system at interest.

In fact, as noted above, the U.S. government cannot create a single new dollar without borrowing it.

But each new dollar that the U.S. government borrows creates more than a dollar of new debt.

As a result, the government eventually has to collect more in taxes than what it has borrowed.

This phenomenon creates an endless debt spiral.

And is that not what we have in the United States today? In fact, you see this in almost every nation on earth where a similar central banking system has been established.

Spiritual topics aside, I find this to be the absolute most important issue upon us. We have enslaved ourselves but can't see this enslavement because we can still buy computers and plasmas TV's therefore we rationalize "how could we be slaves...with all this stuff!"