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• Mothafucker McSmith January 8, 2009 9:32 am

  

  why can’t we print billion dollar bills to negotiate the economic bailout–we could put George Bush’s face on them and dispense them through corporate ATM machines–that should get us free and clear–at least until the apocalypse–and then–FUCK IT!–everybody just MAX YOUR CARDS!

• Sean December 30, 2008 3:35 am

  

  Mark,
  You describe fractional reserve banking not fiat central private banking. I have no problem with fractional reserve banking, while it is regulated. Banking as an industry is not a bad way to service debt.
  As for paying off the debt by an act of congress – that would not cause riots in the US streets. It might cause riots in the sovereign city empire of City of London Corporation, to which I say who cares. I would support the US Airforce dropping bombs on City of London Corporation for that matter. That sovereign city empire is the blood enemy of all free Americans.
  As for my and many others observation that private central banking causes loss of wealth in the middle class that is NOT correlation without causation Mark. They are directly related to the money supply as Milton Friedman proved. Spouting off a trinket of Latin is not going to do you any good trying to disprove Friedmans legacy.
  The supply of money in an economy dictates the inflation rate. Inflating the supply of money in the economy by charging interest on the issuance of money will always cause inflation/deflation periods that strip the wealth from the middle class. Only crack pot keynesian economists would suggest inflation is a good thing.
  That kind of mumbo jumbo is pure trash. Anyone ever wonder why no one can understand people like Mark and Alan Greenspan when they talk about monetary policy? It’s because they don’t want you to know the honest straight forward truth of money. They rely on spatterings of obscure theories and odd sounding phrases to explain why it is a good thing that private bankers should be allowed to rob everyone blind.
  Marks continued insistence that the Federal Reserve Bank is a part of the government is purely laughable in the age of the internet. Just how stupid do you think your listeners are Mark? In ten seconds anyone can go to google and type in “who owns the federal reserve bank” and hit enter.
  Anyone that can read English will learn very quickly that the answer to who owns the Fed is:
  “there is a linear connection between the Rothschilds and the Bank of England, and the London banking houses which ultimately control the Federal Reserve Banks through their stock holdings of bank stock and their subsidiary firms in New York.”
  Not only have countless independent researchers discovered the private ownership of the Fed, but so has congress. Mark has worked in congress and specialized in econ in school, so I find it impossible to believe he doesn’t know this already. The special commission created to look into the Fed and the IRS was the “Grace Commission”. This commission of congress found that the Fed is private. That it does charge interest on the issuance of money into the money supply, and that 100% of the money collected by the IRS goes to pay that interest. That means that all the money you pay in “income” tax goes directly to the private Fed.
  The Grace Commission report, “Modern Money Mechanics”, the writings and speeches of Congressmen Louis McFadden and Ron Paul, and “Lewis v. United States 680” are but a small sample of the massive mountain of research that very clearly shows any American that wishes to educate themselves what the true nature of the Fed really is.
  Mark you are free to defend your theories of money. Most Americans have lost significant portions of their retirement and long term investments. We can all see how fantastic your theories treat the middle class. Members of the CFR may all be on the same page, that accepting financial ruin for the betterment of a ruling class of freaks is a good idea. But, I’m free to defend a very real alternative to this pansy scheme as outlined by those that advocate sound monetary policy.
  On Marks side of the debate we have a multi level marketing pansy scheme of money creation. Private central bankers out of the City of London Corporation, down to the member central banks like the Fed, maintained and propagated by private institutions like the CFR and the Tri Lateral Commission – issue all money out of thin air and pass that money down the pyramid. Just like Amway the guy at the top of the pyramid gets kick backs from all the lower levels of the scheme. People line up to be a part of the pyramid as it is very profitable and greed is a great motivator.
  Soon the pyramid is so large and so self feeding you have an entire industry of corporations, politicians, PR people (like Mark), and confusing economists all promoting the pyramid as though it is not an outright fraud.
  Look at the back of the one dollar bill to see their system of money for yourself.
  On the other side of the debate you have Milton Friedman and the sound money theories. This side says, create the money out of thin air by the legislator (like the US constitution says), and match it to the size of the economy. The issuance of the money is interest free and the money never needs to be paid back up the chain. Instead it is used to service the liquidity needs of the economy directly with no pansy scheme attached to it.
  FYI…
  “Backing” the money with a metal that can be monopolized and cornered, is a red herring. Sound money has nothing to do with backing the money up with a commodity. The only reason to back money by metal would be to try and prevent inflation. Inflation can be controlled by matching the money supply to the size of the economy so this outdated theory is no longer supported by serious economists.

• Mark December 29, 2008 10:20 pm

  

  Sean, the Federal Reserve was created by an Act of Congress in 1913. I will not explain the entire structure and history of the Federal Reserve to you. You really should read it for yourself. But briefly:
  The Federal Reserve does NOT make a profit. It is a nonprofit institution. It is regulated by the US Government by law and the US President appoints its Board of Governors, with the approval of Congress. (If you feel regulation is insufficent, that’s another issue and, I think, a valid criticism, but insufficient regulation is not the same as no regulation.)There’s a more complex system to elect the presidents of the regional banks that includes some private as well as public interests but the Board of Governors has majority control of the Federal Open Market Committee that makes the important “central bank” decisions nationwide.
  Creating money “out of thin air” is indeed the essence of what central banks do. Interestingly, it is also what ordinary banks do, although they are properly regulated and restricted by a good central bank.
  Perennial Presidential candidate and preacher William Jennings Bryan used to complain about being crucified on a “cross of gold” at the turn of the 20th century because he (like I) thought it ridiculously arbitrary that the amount of gold in existence would determine the amount of money in existence. In the 19th century, a Gold Rush meant easy credit while a gold shortage led to a sharp financial contraction. The gold standard made little sense then and even less sense today. Farmers and other “ordinary people” demanded paper money and eventually they got their wish.
  The creation of money by ordinary banks out of “thin air” is not that hard to understand. (They teach it in Economics 101, a really good class I would recommend to anyone whether student or adult.)
  Here’s a quick explanatory example:
  Bank receives $100 from Person A. Bank keeps 10% as a reserve and loans out $90 to Person B which is deposited in this (or another) Bank. Bank then keeps 10% and loans out the remaining $81. How much money is now in circulation? $171. Even without making further loans, the bank has created $71 out of thin air!
  Poof. It’s either black magic or an understanding of economics. But it really isn’t a conspiracy. It is the natural way credit has expanded the money supply from time immemorial.
  Finally, while Sean is right that Congress could unilaterally default on the National Debt, I think it would be extraordinarily unwise to declare “National Bankruptcy”. Treasury bills, seen right now as the safest investment worldwide, would suddenly be worthless. Neither foreign countries nor the tens of millions of Americans who hold these bills would ever invest in America again. Even in the gravest of times — the American Revolution and the Civil War — Washington and Lincoln respectively understood that a nation must pay its debts. If the USA ever once defaulted on its debts, it would destroy our economy and trade for several generations to come, possibly longer. We would go from a world leader to a two-bit Third World nation in that one action. And there would be likely be riots in the streets. I am not aware of a single Member of Congress–including Ron Paul!–to ever suggested such an action at any time in American history.
  Finally –
  1: The Government has many different “pots of money.” (Ask Al Gore about his “lock box.” That would have kept Social Security funds in one part of the Treasury inviolate from being spent by another part of the Treasury.) Moving money or assets from one part of the Government to another part of the Government is very common.
  2. Why has global warming increased since the Fed began existing in 1913? “Post hoc ergo propter hoc”, the logical fallacy suggested by Sean, claims that anything that happens after another thing causes it. But it’s n obvious fallacy. The fact that Obama won his election a few months after Michael Phelps won his medals does NOT mean Phelps caused Obama to win. Neither is the Great Depression of 1929-34 attributable to the creation of the Fed in 1913.
  3. I’ve explained the money supply above. Inflation is not always a bad thing. Indeed, moderate inflation is a very good thing. Without it, you have extreme credit crunches as they had in the late 19th Century. But inflation can get out of control. That’s why we have a Central Bank to regulate it.
  4. The Fed does not make a profit. I quote now from the FAQ on the Federal Reserve website: “After paying its expenses, the Federal Reserve turns the rest of its earnings over to the U.S. Treasury.”

• Sean December 29, 2008 5:18 pm

  

  http://www.informationclearinghouse.info/article21556.htm
  Here is a story on HR 2755.
  Tough questions that Mark can’t honestly answer:
  1 – How can the Act designate the Director of the Office of Management and Budget to liquidate Fed assets and transfer them to the Treasury? How would this be possible if the Fed was already a part of the Government? How can it have assets to be liquidated?
  2 – Why has the standard of living (minus industrial advancements) gone sharply down since the Fed took control of the USD? Why did the great depression happen as the very first action by the Fed once they had control?
  3 – Why do we have inflation now under the Fed, when from the late 18th century to 1913 virtually no inflation existed except during times of war?
  4 – Who receives the profit from the Fed, and where does that profit come from?

• Sean December 29, 2008 4:57 pm

  

  Skip/Mark,
  On June 15, 2007, Ron Paul introduced HR 2755: Federal Reserve Abolition Act. There were no co-sponsors, no further action was taken, and the legislation was referred to the House Committee on Financial Services and effectively pigeonholed and ignored.
  This Act would fix our financial system.
  Marks delusion that the Federal Reserve Bank is part of the Government is a laugh. Mark it is PRIVATELY OWNED. How can something that is for-profit and privately owned not be considered private? Does the US Government receive the profits from the Fed – no. Does the US Government regulate the Fed as you claim they can – no. Does the US people have any ownership of the Fed – no.
  They loan the US banking industry, and the US Government money that they don’t even have to loan out. (yes they create money out of thin air, and back it by absolutely nothing) This make believe money is then paid back to them with interest, by us the US people.
  How can creating money out of thin air and then loaning it to people on interest not be considered a fraud of the highest caliber? Skip you are 100% right and every day more and more people are waking up to this tremendous fraud.
  Mark your position is indefensible. You either deny reality by wishing really hard that this private foreign corporation is somehow legitimate, or you simply can’t deal with the reality and just close your eyes to the situation.
  Any honest assessment of the Fed shows it to be a fraud. Take the congressional record for example if you don’t believe me and Skip – and our cited sources.
  Congress persons have multiple times stood up on the congress floor and demanded audits of many types of the Fed – the Fed always refuses. (some regulation there Mark)
  The Fed stopped providing the money numbers – which I’m sure Mark knows full well. Why? They refuse to tell congress when asked.
  The Fed does not disclose its internal procedures or operations to congress, even when asked to do so.
  The Fed was not created by congress, it was authorized by congress. Congress did not draft any of its policies or procedures. That was done in the dark of night by a small group of PRIVATE bankers on Jekyll Island in total secrecy.
  (google “jekyll island fed” if you don’t believe me)
  Mark is right about one thing though. The power to issue money is guaranteed by the constitution to be the job of Congress, so they DO have the power to disband the Fed.
  HR 2755 would do just that.
  Imagine if the creation of money didn’t come with a ridiculous pay back clause! We could wipe the entire US debt off the books in 5 minutes, with a single act of Congress.
  We could own our own money, and LEGISLATE the inflation rate by tying the money supply to the size of the actual economy.
  We could abolish the IRS as we would no longer need taxes!
  Think of it every one, think! No more taxes. Your money would no longer loose value just because time passed. If you make $20, in 10 years it will still have the buying power of $20.
  The US People and Private Bankers have exchanged the power of the central bank 8 time in our history. Every single time the power is taken by the Private Bankers, the US middle class looses its wealth. Every single time it is taken back by Congress the middle class booms.
  Mark knows this history full well. Ask yourself if he is being disingenuous when he tries in vain to claim the Fed is somehow a part of your government.