What is Digg?356 Comments
- inactive, on 03/29/2008, -17/+145"It turns out that under the charter of the Federal Reserve Bank that it is absolutely illegal for the Fed to loan money to an investment bank."
Oh - the irnoy of it all. The Fed is unconsitutional itself.
The U.S. Constitution set forth the powers of Congress. In Article 1, Section 8, Congress was given the sole power "To coin money, regulate the value thereof…” Likewise, the Coinage Act of 1792 was signed into law by President George Washington on April 2, 1792. It provided for the establishment of the first mint in Philadelphia.
"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."
- Thomas Jefferson (before the existence of the privately-owned Federal Reserve)
The banks are required to maintain a portion of their deposits as cash reserves in the form of U.S. note deposits in reserve banks. And the reason we see very few non-interest bearing U.S. notes in circulation is because they are "non-interest bearing" and kept in bank vaults out of circulation.
In December, 1913; with a barequorum present, Congress passed the 16th Amendment to the Constitution (Federal Income Tax) and also passed the unconstitutional "Federal" Reserve Act.
Read Article I, Section 8, Clause 5 and Article 1, Section 10, of the U.S. Constitution that Congress in Dec., 1913, abrogated their Constitutional oath by passing the "Federal" Reserve Act without a Constitutional amendment ratified by three-fourths of the states consenting.
The 16th Amendment was the vehicle to take money out of the working people's pockets to pay for the unearned interest that the Federal Reserve Act creates and this transfers wealth from the working taxpayer to the rich owners of the unconstitutional "Federal" Reserve who do nothing to earn the money because nothing is backing their privately owned Federal Reserve Notes.
This is how they have the unending supply of money to pay for the transfer of wealth, created by the middle income taxpayer, to the super rich.
It is the assertion that the Federal Reserve System is the main reason local governments are in a financial bind is true because the stock owners of the "Federal" Reserve System are raking in all the profits instead of the money going to the people.
If Congress were to repeal the Federal Reserve Act and eliminate this unconstitutional debt interest system, there would be no national debt and over 300 billion dollars that the taxpayers pay annually on just the interest on this debt, which is unearned interest, created by the liberal finance big spenders could be used to fund a public health program for all Americans, infrastructure for bridges and road repairs, school system, local government expenses and senior citizen needs.
Read Article I, Section 8, Clause 5 and Article 1, Section 10, of the U.S. Constitution that Congress in Dec., 1913, abrogated their Constitutional oath by passing the "Federal" Reserve Act without a Constitutional amendment ratified by three-fourths of the states consenting.
The Federal Reserve Board is staffed by appointments rather than by elections, but the U.S. Constitution empowers only Congress to control the value of the dollar.
This divorced monetary policy means the people lost their Constitutional right to control the money system through their elected representatives thereby giving an unelected monopoly of international bankers control of the money system instead of the citizens of the U.S. as defined by the U.S. Constitution.
When the population increases you get additional money into the system only through debt and these owners of the "Federal" Reserve get a royalty on every additional dollar added to the system through unearned interest.
Concluison: Prepare for the worst and expect the best. Keep your poder dry casue you might need it. - inactive, on 03/29/2008, -7/+82"The auctions are just one of a series of unorthodox steps the Fed has taken to battle the current crisis. The biggest of those moves was an announcement that it was allowing investment banks to borrow directly from the Fed. Previously, only commercial banks, which face tighter regulations, had that privilege."
It turns out that under the charter of the Federal Reserve Bank that it is absolutely illegal for the Fed to loan money to an investment bank. - chipsngravy, on 03/29/2008, -7/+63Typical corporate double standards. Whenever big business are attempting to drive down wages, outsource jobs, and generally throw workers rights down the toilet they get up on their almighty high horses and preach to the rest of us on the wonders of the free market, routinely regurgitating hackneyed capitalist pieties like "let the market decide".
But as soon as they get themselves in trouble they come grovelling to the government with their hands out, as if they have they God given right to get their grubby mitts on taxpayers money.
The sad thing is our elected representatives don't have the bollocks to stand up to these weasels, and instead dole out our hard earned cash by the barrowful in what amounts to a bonanza for the recipients of corporate welfare. - smotpoker, on 03/29/2008, -11/+62$100,000,000,000?!
THOSE BITCHES WON'T EVEN GIVE ME FOODSTAMPS, WTF?!@#! - coolian, on 03/29/2008, -3/+45Ok, help me understand this *****.
Are these ***** just creating the $100 billion from nowhere and lending it out, and as a result, making the dollar even more worthless in the process? - americangoy, on 03/29/2008, -7/+44Like it was said before, the FED can ONLY help out banks. REAL banks.
Not financial institutions, like Bear Stearns and their ilk, who make money lying and swindling by dealing in hedge funds and insane loans of the subprime and adjusted rate mortgage variety.
What happened was against the law.
Don't hold your breath waiting for any prosecution... - motivatedmama, on 03/29/2008, -6/+42Debt = Slavery. Intended effect. End result.
- kelmaster1, on 03/29/2008, -2/+34yes, that is exactly what they are doing. It's called inflation, the hidden tax.
- Misinformant, on 03/29/2008, -3/+31You people are heartless. These bankers might have to have to sell their helicopters and yachts if the government doesn't help.
You would just let that happen?
Disgusting... - Look4Truth, on 03/29/2008, -3/+28The spigot is on...from our pockets to theirs.
- aimhelix, on 03/29/2008, -1/+25$300 Stimulus Payment - lol.
- LordSkywalker, on 03/29/2008, -3/+27***** it. Why not just make it a trillion? If they're going to just pull this out of their asses, why not make it a more exciting number?
- cobbwobbles, on 03/29/2008, -3/+26It's funny how McCain is saying 'don't bail out irresponsible home owners!' but it's ok to bail out the banks that can't get their money back after making loans to poor people? Why not let them sort it out themselves, and get the money from the home owners then? Why hold the hands of the people who knowingly gave out *****, over-complicated loans to people who, let's be honest, they knew might get into exactly this type of situation? They just didn't think about the consequences, didn't think it would come back to them when the whole thing collapsed, the lenders just didn't anticipate how widespread these practices were becoming.
- bc289, on 03/29/2008, -10/+30Don't get me wrong (but I am sure a lot of you will anyway), what the Fed did was not within their powers. It's extremely controversial, and they may have overstepped their boundaries.
However, with that said, it may have saved us all. Sounds ridiculous I know, especially since all you think the Fed and corporations are all evil, but look at Japan in the late 1980s. They faced a similar crises with a housing and stock market bubble, and with banks about to go under. The BOJ did nothing to help out these banks, and the economy went into what is known as the "lost decade", a decade of stagnant growth. In fact, even today, they still are having trouble getting their economy going. The lost decade had a lot to do with the fact that the BOJ contracted the money supply rather than expanding it, and it also had to do with the fact that banks went under (there were basically bank runs and the banks lost a lot of liquidity) without any help. Sounds like they got what they deserved right? Yes, but the financial system collapsed as all banks were affected.
Look what has been happening here in the U.S. We have had a housing bubble and a subprime mess, and Bear Stearns basically had a bank run happen in one day, forcing them to just about go bankrupt. If Bear Stearns had gone bankrupt and hadn't been sold, it would have affected other financial firms as investors would have been quick to pull their money out. We see this time and time again in history, whether it's with Russia and their financial crisis in the 1990s, or back when we were on the Bretton Woods system in the early 1970s. Liquidity is HUGE, and when there are panics, it goes out the window. What the Fed did may have been illegal, but it provided liquidity at a time when it was needed most. Although we are not yet out of the woods, what the Fed did may have saved us from a "lost decade."
Now here come the buries from the Ron Paul and Zeitgeist supporters.... - inactive, on 03/29/2008, -3/+23Don´t hold your breath for anyone to bail out the dumb pukes who got tempted into buying homes thatwre way too expensive for their incomes. "Those people should have known better and now they will just have to take the consequences of their bad decisions"
Uh....if the poor slob from Terre Haute Indiana should have known better, then uh.... shouldn´t the financial geniuses at Countrywide Finance and Bear Stearns, who gave themselves over 2 billion dollars in bonuses last year, uh.... shouldn´t they have known better too?
How come they shouldn´t be responsible for their bad decisions?
How come JPMorgan offered 1 billion for Bear Stearns and it was going to be accepted, otherwise the firm faced bankruptcy, but then three or four days later they change their offer to ten billion! And guess where the other 9 billion came from?
Hahahaha from your pocket sucker!!! - grrrrrrrrrrrrrr, on 03/29/2008, -1/+16I believe it was Bill Clinton that demolished the Glass-Steagall Act that formerly separated the Investment Banks from the Commercial Banks, I think now, technically, anyways, there is no real distinction between the two...it certainly would be interesting to see Obama pose a pointed question to Hillary on this issue.
http://www.pbs.org/wgbh/pages/frontline/shows/wall ... - firepowered, on 03/29/2008, -3/+17We're so rich! Need money? Dont worry, we're printing more!
- inactive, on 03/29/2008, -1/+14@cobbwobbles, I must humbly disagree, the lenders did think about what they were doing and they knew how widespread the practice was. They were sure that when the feces hit the fan that the Treasury Department and the Fed would be standing by, ready with billions of dollars of free money.
They were right. - chijim70, on 03/29/2008, -2/+15then go get your own place and live on it... betting you can't/
- Bodieslikesheep, on 03/29/2008, -6/+18Facism: Government (although the Fed being as Federal as FedEx) and industry colluding.
And yes, banking is an industry.
There has been only 1 presidential candidate who offers solutions to stop the same treatment and abuse of the tax payer - even if our taxes pay merely interest on the Fed loaning us our currency. - ronjohn, on 03/29/2008, -4/+16Let me get this straight banks get over 500 billion because they fugged up but people during Katrina couldn't get water for 3 days and couldn't cross over into the next town either. Real classy America Real Classy. I blame you know who... (the dude Kanye West was talking about)
- ZeroIce, on 03/29/2008, -1/+12I bet the Rockefeller's have a big smile right now.
- merher, on 03/29/2008, -4/+15Just another example that fiat money always grows on trees and in the end has no real value. the only 'thing' backing the currency is an ever increasing amount of debt.
I know this and I'm only 18! - mweels, on 03/29/2008, -0/+10
Its all a game, we still have plenty of military might.
Oh *****, that all takes gas. Were f'd. - Hangly, on 03/29/2008, -1/+11"To say that The Fed is "creating $100 billion from nowhere" is like saying a bank just creates a few hundred thousand dollars whenever it makes a home loan."
Right on both counts. - thefuzz187, on 03/29/2008, -0/+10"Creating Money
To create money, the New York Fed buys government securities from banks and brokerage houses. The money that pays for the securities hasn't existed before, but it has value, or worth, because the securities the Fed has bought with it are valuable.
More new money is created when the banks and brokerages lend the money they receive from selling the securities to clients who spend it on goods and services. These simplified steps illustrate how the process works.
1. The Fed writes a check for $100 million to buy the securities from a brokerage house. The brokerage house deposits the check in its own bank (A), increasing the bank's cash.
2. Bank A can lend its customers $90 million of that deposit after setting aside 10%. The Fed requires all banks to hold 10% of their deposits(in this example, $10 million) in reserve. A couple borrows $100,000 from bank A to buy a new house. the sellers deposit the money in their bank (B).
3. New Bank B has $90,000 (the deposit mine the required reserve) to lend that it didn't have before. A woman borrows $10,000 from bank B to buy a car, and the dealer deposits her check in Bank C.
4. Bank C can now loan $9,000.
This One series of transactions has created $190,099,000 in just four steps. Through a repetition of the loan process involving a wide range of banks and their customers, the $100 million that the Fed initially added to the money supply could theoretically become almost $900 million in new money."
~ The Wall Street Journal. Guide to understanding money & investing
Copyright 1999 by Lightbulb press, inc and Dow Jones & Co., inc.
page. 17 - deklax, on 03/29/2008, -0/+10The banking industry is quite skilled at privatizing profits and socializing losses.
As far as the federal reserve is concerned, in the case of the investment banks that have been taking these massive loans by the Fed, they are putting up sub prime mortages as collateral which have been deemed worthless by the market because of predatory and unfair lending practices. So no one is willing to buy them for any price, but they are good enough for the government? These massive infusions of cash DO increase already rising inflation. At 7% inflation a year your money will be worth HALF what it is today in 10 years.
As far as the "economy works", banks do loan out as much as 20-30 times the amount of assets they have at hand. Bear Sterns had less than 800M in assets and over 30B in liabilities! In effect, they ARE creating money from nothing by "leveraging their assets" against future value that may or may not ever materialize. Due to corrupt federal regulation, they are able to say "I have 10 dollars in my pocket so I am going to loan out 300, charging 10-30% interest then sell that debt to a third party who will assume liability based on statistical probabilities with the collection process fully back by the government - assuming prices continue to rise; and if they don't, we'll just unload it onto the public sector". - PaulOwen, on 03/29/2008, -0/+9QUIIICK PRINT MORE MONEEEEEYYYYY!
- inactive, on 03/29/2008, -1/+10I am sorry to hear that your leadership has shown the same lack of vision in the financial markets as they did in the idiot plan to invade Iraq.
Why would people as bright as Blair and Brown follow an idiot as stupid as our Preident into war and economc ruin? - radu79, on 03/29/2008, -1/+10Kind of strange when you think about it:
If I print my own money, I go to jail.
If they print their money, it's called saving the economy. - db0255, on 03/29/2008, -4/+12step 1. become a bank
step 2. suck ass
step 3. get money from fed!!! - Bodieslikesheep, on 03/29/2008, -2/+10Good luck. Even if Obama or Hillary were to make a "comment", it would merely consist of them either
a) answering in ambigious form
b) referencing how "experienced" or the levels of trust in their administration. (And if you do some research, Democracy Now! has a great article on the people in line to take over cabinet level positions.)
As Immortal Technique says, "It's not the average white person I want to bring it to. In fact, I have more in common with those middle class white people than house negros and sellouts. It is the white man behind the scenes that I need to bring it to." - johnstar, on 03/29/2008, -3/+10America's economy is a ticking ***** time bomb. I knew that ***** when I was in high school (ten years ago).
- StaticThunder, on 03/29/2008, -0/+7The more the money inflates, the easier it will be to pay them off.
- ltchimpo, on 03/29/2008, -1/+8If only the commodity were tea instead of real estate. Hmmm, makes you think the equivalent of dumping tea into our harbors would be destroying the building of financial institutions. I mean really, what ever happened to the executive jumping out of the fortieth floor window?
- PeppermintPig, on 03/29/2008, -2/+9Bad business must be permitted to die off.
Invest less in Dollar based savings and invest more in yourself and assets of sustainable or growing value (not mere dollar based inflation!!!). - qwertydvorak, on 03/29/2008, -2/+9just figuring that out ? a couple thousand years ago a book titled "The Bible" said that the borrower is slave to the lender.
- betterth, on 03/29/2008, -2/+8It's totaled about 450$ billion now. They're getting there! Just give them time =)
- sentime, on 03/29/2008, -1/+7lol they probably will ... woo 1 trillion $ bills .. look at our growing GDP
- Hangly, on 03/29/2008, -1/+7You're right. The facepalm convinced me.
- techweenie, on 03/29/2008, -3/+9The corporation is a super citizen with extraordinary rights under the law. It is naturally encouraged to behave in an amoral fashion, and we have created many laws to protect the management of corporations. No wonder they spend so much money to keep the politicians in their pocket.
Stand up to the Fed and the corporations? The last guy to do that was Elliot Spitzer! - firepowered, on 03/29/2008, -6/+12We're so rich! Need money? Dont worry, we're printing more!
- inactive, on 03/29/2008, -11/+17Article I, Section 8, Clause 18.
McCulloch v. Maryland.
The Federal Reserve Act is constitutional. If you don't like it, fine, but try not to stray into nutter territory. - lopla, on 03/29/2008, -2/+7America is sitting on 54trillion in debt and it's getting worse by the minute. By 2019 this will all crash beyond anyone's wildest imagination. I would like to urge all Americans who can to move to common wealth countries. Start preparing for this now before you are left in a 3rd world country, sitting on a dirt road in ragged clothes, emaciated and covered in flies. Americans really have no idea what is coming. The info is available to anyone with open eyes and a brain.. I already got my family out. Does no one see the collapse is happening?
- ltchimpo, on 03/29/2008, -3/+8oh wait, nm, re-read. looks like im the deutschbag
- Dodobutt222, on 03/29/2008, -0/+5All I'm wondering is: How the hell do you auction money?
- jamie329, on 03/29/2008, -1/+6But why would we tie our currency (and thus the growth of our economy), to something we dig up out of the ground? Does it makes sense that we will magically find more gold at exactly the same rate as our economy grows? To make that happen, we would have to increase the value of gold at the same rate as the growth of the economy, but if that happens, how is gold any different from fiat money? The answer, of course, is that it's not different at all!
- Aokitsune, on 03/29/2008, -0/+5What do you have against Germany?
- sporg, on 03/29/2008, -1/+6Words can not express the incredible anger I am experiencing while reading this article. If the background was a raging petrol fire this picture might come close...
http://www.myps3.com.au/Photo.aspx?id=2523 - gluecode, on 03/29/2008, -2/+7om nom nom nom nom
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