Rhodan
11-23-2006, 04:57 AM
But I don't see it anywhere so.
#1 No, this will not make you rich - it won't get you a penny
#2 No, there is nothing to buy - it won't make me a penny
#3 Yes, it is something everyone should know so they can put pressure on their elected representatives to get it changed!
Our banking and monetary systems (in most western nations) do not work the way most of us think. Exactly how they do work is not taught in school - not even in university level economics classes - I know, I've talked to many students and a couple instructors who were all shocked when I debated with them and they learned the truth.
One tidbit - inflation. The word inflation originally meant an expansion of the money supply (and deflation the contraction of the same). It has since been usurped to describe price increases, leaving no english word to describe the state of the money supply.
Most people have this nebulous idea that money is created by government and that steady price increases are because government is printing too much money but, this is almost completely false. While government does print money and mint coins, the amount created by government is less than 5% of the total expansion of the money supply each year. The bulk of new money creation is done by banks.
This sounds like an incredible statement - how could banks print money? That would be counterfitting wouldn't it?
Well, as far as I am concerned, I believe this SHOULD be considered counterfitting, but I'm not a lawmaker. Instead, governments issue a "Charter" to banks that allow them to lend more money than they get in deposits. This charter is really a license to create money out of nothing.
Before the Federal Reserve (and the Bank of Canada), money in north america was printed almost exclusively by banks. I mean actual banknotes printed by individual banks and a dizzying variety of shapes, sizes, and colours. The amount of money a bank would print depended on its gold reserve but typically each bank printed 5-10 times as much money in notes as they had in bullion. This worked because few people actually withdrew gold, they used the money (paper receipts for gold) instead as its a lot easier to move around.
After many "great" depressions, the Federal Reserve was created to standardize the form of paper money and coins and to act as a stabalizing force in banking. The banker's told Hoover that "with the federal reserve in place, crash's will be impossible" - then immediately after it was created it caused a big recession, a giant land boom in florida (and accompanying bust) then a stock market boom in the 20s and a bust in the 30s (now known as "The" great depression.
Unfortunately, in the United States of Amnesia, people have forgotten that the "Great" depression wasn't the only depression nor was it the greatest one. They also forgot the cause of the great depression - rapid expansion then contraction of the money supply - and instead blame a symptom of the money supply manipulations - a stock market crash.
I've been working on a layman's explanation of how banking works and its effects on the economy and YOU for a couple of years now. You can see what I have done so far at.
http://politicsofmoney.net
I'll be happy to answer any questions people have.
#1 No, this will not make you rich - it won't get you a penny
#2 No, there is nothing to buy - it won't make me a penny
#3 Yes, it is something everyone should know so they can put pressure on their elected representatives to get it changed!
Our banking and monetary systems (in most western nations) do not work the way most of us think. Exactly how they do work is not taught in school - not even in university level economics classes - I know, I've talked to many students and a couple instructors who were all shocked when I debated with them and they learned the truth.
One tidbit - inflation. The word inflation originally meant an expansion of the money supply (and deflation the contraction of the same). It has since been usurped to describe price increases, leaving no english word to describe the state of the money supply.
Most people have this nebulous idea that money is created by government and that steady price increases are because government is printing too much money but, this is almost completely false. While government does print money and mint coins, the amount created by government is less than 5% of the total expansion of the money supply each year. The bulk of new money creation is done by banks.
This sounds like an incredible statement - how could banks print money? That would be counterfitting wouldn't it?
Well, as far as I am concerned, I believe this SHOULD be considered counterfitting, but I'm not a lawmaker. Instead, governments issue a "Charter" to banks that allow them to lend more money than they get in deposits. This charter is really a license to create money out of nothing.
Before the Federal Reserve (and the Bank of Canada), money in north america was printed almost exclusively by banks. I mean actual banknotes printed by individual banks and a dizzying variety of shapes, sizes, and colours. The amount of money a bank would print depended on its gold reserve but typically each bank printed 5-10 times as much money in notes as they had in bullion. This worked because few people actually withdrew gold, they used the money (paper receipts for gold) instead as its a lot easier to move around.
After many "great" depressions, the Federal Reserve was created to standardize the form of paper money and coins and to act as a stabalizing force in banking. The banker's told Hoover that "with the federal reserve in place, crash's will be impossible" - then immediately after it was created it caused a big recession, a giant land boom in florida (and accompanying bust) then a stock market boom in the 20s and a bust in the 30s (now known as "The" great depression.
Unfortunately, in the United States of Amnesia, people have forgotten that the "Great" depression wasn't the only depression nor was it the greatest one. They also forgot the cause of the great depression - rapid expansion then contraction of the money supply - and instead blame a symptom of the money supply manipulations - a stock market crash.
I've been working on a layman's explanation of how banking works and its effects on the economy and YOU for a couple of years now. You can see what I have done so far at.
http://politicsofmoney.net
I'll be happy to answer any questions people have.