Central Banks, How The Rich Stay Rich Last
Photo From blog.fora.tv The First US Bank of Fraud, (since 1913)
Exactly what are the Fed’s Books? This institution is “audited” every year by the US government, but it has never been completely audited. The Fed only allows the government to see what it wants it to see.
In 2012 thanks to independent senator Bernie Sanders, the Fed was forced to reveal what it “loaned” to foreign Mega Banks and Corporations after the financial collapse of 2008.
The sum was a staggering $16 Trillion, which at the time was more than the annual production (GDP) of the entire American economy. One might only wonder what kind of fake collateral it got in return for these loans?
And incidentally this enormous $16 Trillion figure, was hidden by pretty much all US propaganda media except for Forbes, which had the courage to take it to print,
Still even today the Fed resists a fully open an independent audit. As I write the demand for such an audit has overwhelmingly passed the House of Representatives, but Democratic Senator Harry Reid is going to prevent this bill from even being voted on in the Senate.
Until such an audit exists the Feds “books” are pretty much meaningless. They are simply what they want the public to see.
So when the Fed says, as they do today that they have $4+ Trillion of monies they have loaned out, who knows if that is even true?
All of this came to pass because in 1913 the US congress decided to outsource its constitutional responsibility to control the money supply, to bankers who could use this authority, so that they could loan money out at interest to themselves.
Remember Part one of this series, banking is fine in a relatively free market, but like all things commercial, is not fine in a rigged marketplace.
The Federal Reserve as the Capos for the banking mafia, rig the system in a number of ways. Number one they fix interest rates and that determines to a very large degree who wins and who loses.
For example the Federal Reserve today has forced very low interest rates on everyone in the US dollar system.
Who wins from this? Well big money wins. As per part 4 of this series Mega Banks who have special access to the Fed, can borrow for next to nothing and then invest that money in areas that pay high interest rate returns, with virtually no risk, pocketing a fortune, money essentially for nothing.
Corporations can also borrow at very low rates, which is what they are doing. And with the borrowed money they buy their stocks back, which drives the price of the shares up.
People wealthy enough to own stocks make money. But the top officers of the corporations make a killing, because as a part of their pay package they get “stock options”, which only have value when the companies’ stocks gets over a certain price.
These options are designed to reward administrators for doing a good job and making their company flourish. But these stock options also reward administrators who have not in any way made their company better.
All they did in this case, was put their company in debt, so they could use the money to drive up its stock price. These fat cats will then cash out their stock options, many making millions.
Who is hurt by low interest rates? Well old people and savers are hurt and hurt badly. Typically what they receive on their savings is below the inflation rate. Many thrifty old people saved their entire lives so they could supplement a small state pension (Social Security in the US) with interest they might earn on their savings.
Now there is no interest on their savings, so many have to keep working, some even into their late old age while the rich can collectively make billions.
The second way the system is rigged is that only a few Mega Banks and Corporations have access to the dirt-cheap money from the Fed, and the Fed does its best to hide which institutions these are.
Why do some get access to money at rock bottom interest rates, while others don’t? And given that the privately owned Federal Reserve banks refuse to state who their owners are, mightn’t there be a conflict of interest behind which groups the Fed will give its money to and which they won’t?
The Feds “books” are a joke, as is the collateral they receive.
The collateral of a real bank is supposed to be used so if ever a borrower cannot repay his loan, then the collateral is sold to ostensibly compensate the bank for its losses.
But the Feds collateral will never be sold, because if the borrowers, (the Mega Banks) don’t repay, the Fed can always double down and “loan” them more money with even more fake collateral as per Part 4 of this series.
And when you are the sole means of creating money for a country and you can create as much of it as you want, then there is no limit to what you can “loan” out. Collateral is simply a fig leaf, created to make it hard for people to understand what is really going on.
But when the Fed does take collateral it also rigs the system. That is because if the Fed will take someone’s IOU as collateral, suddenly there is a market for it no matter how weak it might be in terms of the potential for non-payment.
Up until recently the Fed accepted municipal bonds as collateral. And that meant that even municipalities in financial trouble could sell bonds at low interest rates, because the buyer of last resort was the Fed with its infinite printing press.
Now the Fed under Janet Yellen has decided to stop accepting Municipal bonds, That means especially for municipalities with a lot of debt and not much tax revenue, that they will have to pay much more to borrow money, with the financial losses coming out of public services,
So the Fed can choose to take the IOUs of one weak company as collateral and not another. And worse since there has been no complete audit in the history of the Fed, it can continue to hide what it does and why,
Since the Federal Reserve law of 1913 all money can only be created as a debt to the privately held Federal Reserve banks. Even the US government must borrow money from the private bankers, the Fed and at interest to them.
It is true that the Fed returns to the treasury the vast majority of money it earns each year. But the question then comes as to why the treasury has to borrow money at interest from the Fed, only for the Fed to return its profits at years end?
Well here is the answer. When the US government borrows money from the Fed, the Mega Banks handle the transactions, and in so doing they make a lot of money. And that stays in the pockets of the bankers.
If you ask the bankers and corrupt politicians why the government can’t handle the transactions itself, they will tell you their usual BS, that these transactions are “complicated”, as if the US Treasury doesn’t have people who can handle complex financial transactions, or can’t get them as needed.
The only person who effectively broke the law and issued money without borrowing it from the private bankers of the Fed was president John Kennedy, He had the US Treasury print the money directly and distribute it debt free. He was killed less than 200 days after he began this process. No other president ever tried it again.
An amazing fact is that apart from Kennedy’s money, every US dollar that exists anywhere in the world, whether in cash or electronically is owed to the privately owned Federal Reserve.
As fantastic as that sounds, think for a minute. The center of US money creation is the Fed. No one else can create money including the US government. The Fed creates dollars ONLY through debt. So the dollars it sends out are all pre-wired to at some point return to their creator like a homing pigeon.
But believe it or not it gets worse. Please don’t just read this without thinking of what it means.
When money is created by the Fed, because someone somewhere borrows it from a bank belonging to the Federal Reserve system, (in the US virtually ALL of them do) the money itself is created BUT THE INTEREST IS NEVER CREATED!
That means for example should you be the first person in the world to borrow $50 from a Fed bank, the Fed dutifully prints this first $50 bill and hands it to you. But should you want to repay this loan 5 minutes later, you can’t.
That is because you borrowed the money at interest. And even if the interest on that loan is only 10 cents, there is nowhere on earth you can get that 10 cents from, because it doesn’t exist.
The only way you can ever repay your loan with the interest you owe, is if some other fool borrows money from a bank belonging to the Fed.
Then if you can get 10 cents of that person’s money, you could pay off your debt with the interest, but then there would not be enough money in the world for the second person to pay off his debt with, along with the interest, until a third fool would borrow money into existence and so on and so on.
The money borrowed is always created, but NEVER the interest. Thus at any given point of time, the cumulative debts that are created by the Fed through the creation of money, can NEVER be repaid because there is not enough money in the world to repay them, until yet another person takes out yet another load.
This all goes to the benefit of the Mega Banks who almost certainly own the Fed. Like drug pushers they effectively force debt, at guaranteed profits to themselves, on everyone in the US dollar system.
This is what debt money is all about.
And all of this terminal nightmare that is the US Federal Reserve, could have been so easily avoided, by having an agency that in the name of the people of the country simply printed money as needed and either sent it out to its citizens, or handed it over to their government no strings attached.
If you want to know why this is all happening think of who probably owns the Fed. No not the banking institutions who own it, (which the Fed still hides) but the people who/ control those institutions. No one will ever tell you. This secret is guarded more carefully than nuclear weapons technology.
Then think about this very old saying.
Gold is the currency of kings. Silver is the currency of merchants Barter is the currency of peasants, but debt is the currency of slaves.