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| What's the deal with the fed?; I keep bumping up with vague theories | |
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| Tweet Topic Started: Oct 28 2008, 05:52 AM (891 Views) | |
| mynameis | Oct 30 2008, 02:14 PM Post #26 |
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Internet Jujitsu
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I am not moving away from any post. All these are behaviors exhibited by those with whom the FED banks operate. Taxes fund the debt run up by the FED each year. The money funded for that loan comes from what source; what source pays off the loans from the previous year? Loans are taken in at interest, the more interest gained versus money in circulation. If there was a run on the banks, what is contained by law at all banks is what I meant by fictional 0s and 1s. The amount of fictional 1s and 0s and the legal amount of 0s and 1s as required by each bank are caused by interest on the loans etc...are not balanced for the real world, there would be a shortage.
Do you have a link to the M3 data from last year proving this?
Perhaps you don't realize that I put the words "can easily become" in that sentence for a reason?
In theory that's what should be happening, but the reality isn't in the United States. This is why tax breaks are given to corporations come hell or high water.
Excuse my French (no shit). This is why most banks have diversified into other currencies and derivative markets. No banks form or buy into a multinational corporation which does buy public property like: transportation, water, electric, energy, or communications etc...
When money printing and circulation are part of keeping the economy floating on a sea of derivatives, there are too many factors to name so I won't begin to start. I will state that its like baseball cards in circulation; the more rare a card the more its worth. Just as dollars, whereas the more dollars in circulation, the more inflated the currency. Edited by mynameis, Oct 30 2008, 02:18 PM.
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| FreeCriticalThinker | Oct 30 2008, 07:55 PM Post #27 |
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When I say that the thread is being derailed I don't mean it in a bad way. Now, as soon as we started discussing fiscal policy and the misconceptions you had with forward contracts and issue of lending and spending beyond one's mean, we did went of topic. Still I think the conversation has been interesting all the while.
First of all I should clarify that the Federal Reserve does not operate any banks, remember that it is a quasi-public and quasi-private institution and member banks are part of the quasi-private component. Taxes do not fund the debt owned by member banks, in any case debt is funded by deposits from the open market. In the specific case a bailout the Federal Government makes a loan and takes ownership of certain assets, to take this idea and claim that taxes fund the debt owned by member banks is quite a leap.
Banks get money from various sources, the normal deposits and loans bank gets cash from financing activities (selling of financial instruments) and direct deposits. The loans from the previous year paid by their clients, just like when you go to pay your credit card every month.
Yes, this is the only logical thing to do. Why would I lend you any money when I could invest it in some productive activity and get a return on it? You would have to offer a higher return rate or compensate some of it with significant lesser risk. The concept of pricing the transfer of money between time periods is not particular to modern banking so it even if you do away with the fed people still wouldn't lend you a single dime at a 0 interest rate ... unless you buy something from them, but that's another story.
You are a bit confused in this issue. First, yes banks are required to keep a percentage of its deposit by law, but this money is far from fictional. Actually, in the case of a run this is the only cash the banks would have on hand before they scramble for cash. The requirement is not caused by the interest on the loans, rather it is a ratio of the total deposits held by a bank.
This information is not contained in monetary aggregates, this info has more to do with fiscal policy than monetary policy. You would find this info in the fiscal year reports presented by the government. This document here: http://www.whitehouse.gov/omb/budget/fy2007/pdf/07msr.pdf can give you an estimate of the amounts. I used a slightly increased number (if you see the actual net interest row in the table in page 41 you'll see it's actually 264 billion us$) for the calculations, but the that illustrates my point even further as it represents a smaller share of the government expenditures.
You can't compare corporations and individuals if you do wish to go there I can tell you right now it is a very unfair comparison. Now, between individuals those with a higher income, in reality, do pay a higher share of their income in taxes.
Those are long/medium term investment and are not liquid enough to be able to be used to buy any kind of goods and services without penalties or transaction costs, far from making a bargain banks would be at a loss if they did this.
Public transportation and utilities are usually monopolized and subsidized by the government, as soon as a bank buys any of these firms then it becomes private. Energy stopped being a public good a long time ago, if it ever was.
Assuming that this is in fact taking place in the real world. Can you post real world data that support this assertion? According to the bureau of printing and engraving a large part of the bills they print are used to replace those already in circulation, not to keep the economy afloat. |
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| mynameis | Oct 30 2008, 08:24 PM Post #28 |
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Internet Jujitsu
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I don't see what you see in this pdf. http://www.whitehouse.gov/omb/budget/fy2007/pdf/07msr.pdf On the rest it's clear you don't see what I see either and I don't have time to find the information. Which is locatable, but I'd rather leave it as you have your opinion and haven't show proof as I haven't. I asked for one simple thing, show us the M3 data for 2007, you can't. So have a nice whatever. One final note is that the WH documents are not acceptable due to conflict of interest in how the operation works. You should have posted a link from a college or school of economics. Dated yet still valid.
http://chestofbooks.com/finance/banking/Banking-And-Currency/Chapter-II-The-Value-Of-Money.html Edited by mynameis, Oct 30 2008, 08:34 PM.
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| FreeCriticalThinker | Oct 30 2008, 08:44 PM Post #29 |
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Just scroll down to page 40 and look at the table named "Outlays by function". Remember that you asked for the information to prove the ratio I calculated to demonstrate that your idea about the interest growing to a level beyond the principal or that people are taxed to pay for this interest was not accurate.
Actually I've shown more than just an opinion, I've done the calculations to backup my posts and sourced the necessary numbers.
You asked for m3 data to proof something that is not contained in that monetary aggregate, that is why I corrected your misconception and redirected you to the correct source. Still, why do you want me to calculate m3 for you?
There is no conflict of interests with those documents, they are presented to Congress every year and are audited by the Government Accountability Office ... if there was a flaw in those documents we'd know by now. |
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| FreeCriticalThinker | Oct 30 2008, 08:47 PM Post #30 |
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You posted that quote after I finished posting my last post. Please, which of your points is supported by it? The information contained in it is pretty accurate yet it's only tangentially, at its best, related to the different points you've put forth. |
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| FreeCriticalThinker | Nov 4 2008, 12:14 PM Post #31 |
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After listening to Edward Griffin's speech I have to say that I'm surprised at the amount of intellectual dishonesty I've been exposed in the last hour I dedicated to listen to this. I would like to start with the basic premise behind his, let's call them assertions: The Federal Reserve was created to loan money to the government. He even makes it explicitly clear when he said:
A brief look at the numbers tells us a complete different story. Please take a look at this document and go to page 232. There you'll find a table with the following data: Total Gross Federal Debt: 8,950.7 Billion US$ At the end of 2007, the Federal Reserve Banks held $779.6 billion A quick calculation paints a different story than the one Griffin is trying to sell: only 8.7% of the total federal debt is held by Federal Reserve Banks. If Griffin was right, we should expect a much higher share given the "fact" (according to Griffin that is) that one of the reason the fed was created is so that the government can borrow from them. Still, the government uses less this source for less than 9% of its total debt. How could this be when, again according to Griffin, the fed was created so the government can have access to any amount of money at any time? The only answer is: Griffin is not telling the truth. And this is just the start, but first I would like to know what do you guys think about this particular bit. Edited by FreeCriticalThinker, Nov 4 2008, 12:17 PM.
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| FreeCriticalThinker | Nov 8 2008, 02:52 AM Post #32 |
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So no one is going to comment about this? Not even the video poster or JFK who so strongly suggested and insisted that I watched this pack of lies? |
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| gata.org | Nov 8 2008, 08:49 PM Post #33 |
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You should watch "money as debt" or "zeitgeist addendum", they explain in quite easy to understand terms how the central banking scam works, the government creates debt paper which the fed buys using money it creates out of thin air, or computers. This creates a situation where the government is essentially owned by the central bank. This constant injection of new paper money into the economy is why prices constantly go up, rather than decreasing as you would expect with increasing abundance. Another aspect of the scam is the crises which are deliberately orchestrated every 20 years or so, which get steadily worse (i.e. the crisis is at the moment is much worse than the one we had 20 years ago). The central bank acts as "lender of last resort", it essentially authorises itself to give the failed banks money to "recapitalise". Again this is freshly printed cash which goes to enable this (causing more inflation). You and me pay the price of banker "stupidity" with higher milk prices at the supermarket. Your point about the fed not holding much of the debt, well I've heard a lot of it is held by foreign (privately owned) central banks, the largest holder being china of course. The central bank problem isn't unique to the USA by any means, almost every country has one. |
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| JFK | Nov 8 2008, 09:12 PM Post #34 |
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Well obviously you didn't. Because it was an audio presentation. I have yet to see you prove any of that presentation false. And frankly with your attitude, I could care less.
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| esopxe | Nov 9 2008, 12:27 AM Post #35 |
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I knew from your first response
that the last thing that you were actually after was learning about the FED. I'm sure your mind was already made up before you even came to this forum. Some people only need a little bit of evidence to know something is seriously wrong with the FED and some people can never be shown enough. Keep on truckin. |
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7:55 PM Jul 10