Genuine Progress Indicator
GDP as a shorthand indicator of progress; but the GDP is merely a sum of national spending with no distinctions between transactions that add to well-being and those that diminish it
According to Redefining Progress' latest Footprint Analysis, humanity is exceeding its ecological limits by 39%. Or, put another way, we would need to have over one third more than the present biocapacity of Earth to maintain the same level of prosperity for future generations.
Income Distribution
Both economic theory and common sense tell us that the poor benefit more from a given increase in their income than do the rich. Accordingly, the GPI rises when the poor receive a larger percentage of national income, and falls when their share decreases.
Housework, Volunteering, and Higher Education
Much of the most important work in society is done in household and community settings: childcare, home repairs, volunteer work, and so on. The GDP ignores these contributions because no money changes hands. The GPI includes the value of this work figured at the approximate cost of hiring someone to do it. The GPI also takes into account the non-market benefits associated with a more educated population.
Crime
Crime imposes large economic costs on individuals and society in the form of legal fees, medical expenses, damage to property, and the like. The GDP treats such expenses as additions to well-being. By contrast, the GPI subtracts the costs arising from crime.
Resource Depletion
If today's economic activity depletes the physical resource base available for tomorrow, then it is not creating well-being; rather, it is borrowing it from future generations. The GDP counts such borrowing as current income. The GPI, by contrast, counts the depletion or degradation of wetlands, forests, farmland, and nonrenewable minerals (including oil) as a current cost.
Pollution
The GDP often counts pollution as a double gain: Once when it is created, and then again when it is cleaned up. By contrast, the GPI subtracts the costs of air and water pollution as measured by actual damage to human health and the environment.
Long-Term Environmental Damage
Climate change, ozone depletion, and nuclear waste management are long-term costs arising from the use of fossil fuels, chlorofluorocarbons
Changes in Leisure Time
As a nation becomes wealthier, people should have more latitude to choose between work and free time for family or other activities. In recent years, however, the opposite has occurred. The GDP ignores this loss of free time, but the GPI treats leisure as most Americans do—as something of value. When leisure time increases, the GPI goes up; when Americans have less of it, the GPI goes down.
Defensive Expenditures
The GDP counts as additions to well-being the money people spend to prevent erosion in their quality of life or to compensate for misfortunes of various kinds. Examples are the medical and repair bills from automobile accidents, commuting costs, and household expenditures on pollution control devices such as water filters. The GPI counts such "defensive" expenditures as most Americans do: as costs rather than as benefits.
Lifespan of Consumer Durables & Public Infrastructure
The GDP confuses the value provided by major consumer purchases (e.g., home appliances) with the amount Americans spend to buy them. This hides the loss in well-being that results when products wear out quickly. The GPI treats the money spent on capital items as a cost, and the value of the service they provide year after year as a benefit. This applies both to private capital items and to public infrastructure, such as highways.
Dependence on Foreign Assets
If a nation allows its capital stock to decline, or if it finances consumption out of borrowed capital, it is living beyond its means. The GPI counts net additions to the capital stock as contributions to well-being, and treats money borrowed from abroad as reductions. If the borrowed money is used for investment, the negative effects are canceled out. But if the borrowed money is used to finance consumption, the GPI declines
http://www.rprogres
Why we need to close the Federal Reserve System/bank
In order to finance the North's Civil War efforts, Lincoln approached the European banks controlled by the Rothschilds in 1861.
They demanded 24% to 36% interest. Lincoln refused and instead passed the Legal Tender Act of 1862. Under this new piece of legislation, Lincoln issued US$449,338,902 of interest-free money, known as Greenbacks, so-called from the green ink they used. It served as legal tender for all debts, public and private and was used to finance the Union's Civil War efforts.
"The government should create, issue and circulate all the currency and credit needed to satisfy the spending power of the government and the buying power of consumers...
An editorial in the London Times, 1865, reveals sentiment of the European bankers:
"If this mischievous financial policy, which has its origin in North America, shall become endurated down to a fixture, then that Government will furnish its own money without cost. It will pay off debts and be without debt. It will have all the money necessary to carry on its commerce. It will become prosperous without precedent in the history of the world. The brains, and wealth of all countries will go to North America. That country must be destroyed or it will destroy every monarchy on the globe."
By the end of 1863, Congress had authorized the printing of US$850 million worth of Greenbacks. Private banks used these Greenbacks as bank reserves, against which they issued their own bank notes and demand deposits. Over the course of the U.S. Civil War the money supply went from $45 million to $1.77 billion. Prices subsequently skyrocketed.
In 1863, Congress passed the National Bank Act from which point forward, all money in circulation would be created out of debt from bankers buying U.S. government bonds in exchange for bank notes. By 1865, the national banks had 83 percent of all bank assets in the United States.
Lincoln was assassinated by John Wilkes Booth on April 14, 1865, just five days after Lee surrendered to Grant. On April 12, 1866, Congress passed the Contraction Act which called for retiring Lincoln's greenbacks from circulation as soon as they came back to the Treasury in payment of taxes.
Assassination of President Garfield
President James A. Garfield was inaugurated in 1881 and was the second American president to be assassinated. He was shot by Charles J. Guiteau on July 2, 1881 and later died from medical complications on September 19.
Two weeks before being shot, President Garfield is attributed with saying:
"Whoever controls the volume of money in our country is absolute master of all industry and commerce...and when you realize that the entire system is very easily controlled, one way or another, by a few powerful men at the top, you will not have to be told how periods of inflation and depression originate."
Panic of 1907
Three failed attempts of establishing a central bank in the United States did not dissuade a fourth. By the beginning of the 20th century the most influential business men and bankers were the J.D. Rockefeller, J.P. Morgan, Paul Warburg, and the Rothschilds.
The Panic of 1907 was a run on the American banking system as a result of a public announcement by J.P. Morgan that a prominent bank in New York was insolvent. The results were wide-spread mass withdrawals on the entire banking system. This forced the banks to call in their loans. Bankruptcies, repossessions and financial turmoil emerged.
Congress created the National Monetary Commission after the Panic of 1907 to draft up a plan for banking reform. Nelson Aldrich headed the Commission that comprised of two components - one to study the European central banking systems headed by Aldrich himself and another to study the American monetary system.
Centralized banking was met with much opposition from the American public, who were suspicious of a central bank and who charged that Aldrich was biased due to his close ties to wealthy bankers such as J.P. Morgan and his daughter's marriage to John D. Rockefeller, Jr.
Creation of the Federal Reserve
Allegedly, in exchange for financial support for his presidential campaign, Woodrow Wilson agreed that if elected, he would sign a bill that would lead to the formation of a central bank for the United States.
On 1910, a secret meeting took place on the Morgan estate on Jekyll Island, Georgia. Aldrich met with representatives of prominent banking firms. Such men included Henry Davison (senior partner of J.P. Morgan Company), Frank Vandelip (President of the National Bank of New York associated with the Rockefellers)
Over a period of ten days they drafted the Federal Reserve Act that was voted on in Congress on Monday 22 December 1913 between the hours of 1:30 am to 4:30 am when much of Congress was either sleeping or at home with their families for the Christmas holidays. It passed through the Senate the following morning and Woodrow Wilson signed the bill into law later that same day at 6:02 pm. This Act transferred control of the money supply of the United States from Congress as defined in the U.S. Constitution to the private banking elite.
The deceptive terminology of the name was carefully chosen because the American public did not want a central bank similar to those in Europe. The Federal Reserve is not a federal governmental entity nor is it a reserve, such as a governmental treasury, backing up its currency. The Federal Reserve is a legalized cartel of the money supply owned by private national banks, operating for the benefit of the few under the guise of protecting and promoting public interests.
The meeting on Jekyll Island remained unknown to the public until Forbes magazine founder Bertie Charles Forbes wrote an article about it in 1916, three years after the Federal Reserve Act was passed.
Wilson wrote in his book, The New Freedom:
"A great industrial nation is controlled by its system of credit. Our system of credit is privately concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men...[W]e have come to be one of the worst ruled, one of the most completely controlled and dominated, governments in the civilized world--no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and the duress of small groups of dominant men." (Woodrow Wilson, The New Freedom: A Call for the Emancipation of the Generous Energies of a People)
A central banking system wherein every Dollar created is an instrument of debt requires the collection of large sums of money from the people to pay off the interest. Interestingly, 1913 was also the year that introduced the Sixteenth Amendment, thereby giving government the power to collect taxes based on income.
World War I
In 1914, when war broke out in Europe, the American public did not want to become involved. While President Woodrow Wilson publicly declared that the United States would remain neutral, efforts were being made behind the scenes to ensure America's entry into the war.
Wars are extremely profitable for central bankers because it forces the governments to further borrow addition money at interest. Secretary of State, William Jennings Bryan wrote, "the large banking interests were deeply interested in the world war because of the wide opportunities for large profits."
Allegedly on May 7, 1915 the Lusitania, an ocean-liner carrying American passengers, was deliberately sent into German controlled waters. The German Imperial embassy paid to have a warning ad in fifty East Coast newspapers, including those in New York, stating that anyone boarding the Lusitania would be doing so at their own risk . The ad appeared only in the Des Moines Register.
As expected, a German U-boat torpedoed the Lusitania. German records indicate that a large secondary explosion followed the torpedo hit leading some to speculate the storing of ammunition. As a result 1,198 people of the 1,959 aboard lost their lives and the U.S. shortly entered the war thereafter.
The First Moves of the Federal Reserve
The public was told that the creation of the Federal Reserve would stabilize the economy. From 1914-1919 the money supply nearly doubled.
This resulted in extensive loans to small businesses and the public. A calling in of the loans in 1920 resulted wide-spread bankruptcies and bank-runs marking the steep 1920-1 recession. Over 5400 independent and competitive private banks outside of the Federal Reserve System collapsed thus consolidating the power of the central banks.
The Harding administration did not intervene despite political pressure to do so. Harding's approach to the problem was, "the banks got themselves into this mess, so let them get themselves out of it." Since the Harding administration public management of the economy has emerged as a primary activity of the government.
President Harding was the sixth president to die while in office. It was during his "Voyage of Understanding"
The Great Depression
From 1921 to 1929 the Federal Reserve increased the money supply by 62% thus fuelling the period known as the Roaring Twenties. Further fuelling the rise in stock market indices was a new type of loan, known as a margin loan, whereby an investor would only need to put down 10% of the value of a stock with the remaining 90% being loaned from the broker.
Like today, these loans could be called in at any time and had to be paid within 24 hours, known as a margin call. This is typically accomplished by the selling of the stock purchased using the loan.
These two factors, loose monetary policy and easy loans resulted in a fivefold increase in the Dow Jones Industrial Average over the latter half of the 1920's.
The mass calling in of these margin loans by the New York banking establishment resulted in the devastating market crashes of October of 1929. "Black Thursday", the initial crash, occurred on October 24. The crash that caused general panic five days later on October 29 was known as "Black Tuesday".
Then, instead of expanding the money supply, the Federal Reserve contracted it, thereby creating the period known as the Great Depression. Congressman Wright Patman in A Primer On Money reported that the money supply decreased by eight billion dollars from 1929 to 1933, causing 11,630 banks of the total of 26,401 in the United States to go bankrupt. This allowed central bankers to buy up rival banks and whole corporations at a deep discount.
It is interesting to note that biographies of J.P. Morgan, Joe F. Kennedy, J.D. Rockefeller and Bernard Baruch indicate that they all managed to transfer their assets out of the stock market and into gold just before the crash of 1929.
Legend has it that Joseph P. Kennedy decided to sell his considerable stock holdings after hearing an investment tip from a shoe-shiner. Joe Kennedy went from having $4 million in 1929 to over $100 million in 1935.
One must wonder if that 'shoe-shiner' was Paul Warburg, a founder and original member of the Federal Reserve warning of the coming collapse and depression in an annual report to the stockholders of his International Acceptance Bank,
"If the orgies of unrestrained speculation are permitted to spread, the ultimate collapse is certain not only to affect the speculators themselves, but to bring about a general depression involving the entire country." (Paul Warburg, March 1929)
On June 10, 1932, Congressman Louis McFadden, a long-time adversary to the Federal Reserve, made a 25-minute speech before the House of Representatives, in which he accused the Federal Reserve of deliberately causing the Great Depression.
In 1933, McFadden introduced House Resolution No. 158, Articles of Impeachment for the Secretary of the Treasury, the Comptroller of the Currency, and the Board of Governors of the Federal Reserve, for numerous criminal acts, including but not limited to, conspiracy, fraud, unlawful conversion, and treason.
Louis McFadden died in Oct 3, 1936 during a visit to New York City. The official reason of death was "heart-failure sudden-death"
There were previously two alleged attacks on McFadden's life. The first came in the form of two revolver shots when he was in a cab outside one of the Capitol hotels. Both shots missed their intended target. The second was when he became violently ill after a political banquet at Washington. He was saved from a physician friend at the same banquet that procured a stomach pump and gave McFadden emergency treatment.
Seizure of the American Public's Gold
Under the pretense of helping to end the Great Depression came the 1933 Gold Seizure whereby the Roosevelt Administration outlawed private ownership of gold. Under the threat of imprisonment for 10 years, a US$10,000 fine or both, everyone in America was required to turn in all gold bullion to the U.S. Treasury.
The rationale for the seizure was that the declining prices of the Great Depression were a direct result of overcapacity. This flawed reasoning resulted in the creation of disastrous policies such as National Industrial Recovery Act where business cartels were deliberately constructed to keep prices high and the Agricultural Adjustment Act that ordered mass destruction of livestock and crops in order to reduce supply and drive up prices. In a time when unemployment is at record highs and people are suffering from economic hardship, these policies are the complete opposite of what is required.
As a final component to the Roosevelt Administration'
On April 5, 1933, Roosevelt signed Executive Order 6102, which ordered people to turn in their gold to the government at payment of $20.67 per ounce. Individuals could hold up to $100 in gold coins, and there were some exceptions for dental use, jewelry, and artists and others who used gold in their jobs.
While U.S. citizens could be ordered not to hoard gold, Roosevelt knew he could not impose such a law on sovereign nations. Foreigners could still exchange there U.S. dollars for gold, but shortly after issuing Order 6102, Roosevelt devalued the Dollar to US$35 per ounce thereby decreasing the value of the Dollar overnight by 40.94%.
The result of these policies allowed greater ability of the Federal Reserve to increase the amount of money in circulation thereby increasing their revenue from interest.
World War II
"The question was how should we maneuver them [Japan] into firing the first shot...it was desirable to make sure the Japanese be the ones to do this so that there should remain no doubt as to who were the aggressors." (Henry Stimson, U.S. Secretary of War prior to WWII, Nov. 25, 1941 in a journal documenting his conversation with President Roosevelt)
Franklin Delano Roosevelt's uncle, Frederic A. Delano, was appointed by Woodrow Wilson to the First Federal Reserve Board on August 5, 1914. Roosevelt may have been sympathetic to the central bankers desire for American entry into the Second World War. There exists some suggestive evidence that the Roosevelt administration provoked the Japanese into attacking American forces stationed at Pearl Harbor.
In 1940, FDR ordered the pacific fleet transferred from the West Coast to Hawaii. Admiral Richardson complained of inadequate protection from both air and torpedo attack. He twice disobeyed orders to berth the fleet there and was replaced by Admiral Kimmel, who later brought up the same issues.
On October 7, 1940, Lieutenant Commander Arthur McCollum wrote an eight page memo describing a process to force Japan into war with the U.S.
On February 11, 1941, FDR proposed sending six cruisers and two carriers to Manila. It is generally agreed that the U.S. oil embargo on Japan lead promptly to the Japanese invasion of the Dutch East Indies.
Roosevelt further antagonized Japan by freezing all of the Japanese assets in the United States, supplied financial aid to Nationalist China and military aid to the British in violation to the existing international war rules.
On Dec 4, three day prior the attack on Pearl Harbor, Australian intelligence warned Roosevelt of a Japanese task force moving towards Pearl Harbor.
The attack resulted in the deaths of 2,400 American soldiers and resulted in the entry of the United States into the war. Before the attack on Pearl Harbor, 83% of the American public did not want to enter the war. After the attack, one million men volunteered for the military service.
Bretton Woods Agreement
The United States had emerged from the Second World War as a dominant world power both militarily and economically. It had grown wealthy selling weapons and lending money to both sides of the war.
In 1945, the U.S. produced half the world's coal, two-thirds of the oil, and more than half of the electricity. The U.S. manufacturing industry was able to produce great quantities of machinery, including ships, airplanes, vehicles, armaments, machine tools, and chemicals. In addition, the U.S. held over 65% of world's gold reserves and was the sole possessor of the atomic bomb.
Delegates from 44 Allied nations gathered at the Mount Washington Hotel in Bretton Woods, New Hampshire for the United Nations Monetary and Financial Conference during the first three weeks of July 1944. The purpose of the conference was to establish the rules for commercial and financial relations amongst the world's major industrial states. The agreements signed at this conference became known as the Bretton Woods Monetary System.
The Bretton Woods Monetary System was basically a pegged rate currency exchange system with the U.S. dollar functioning as the underlying currency. All countries would peg their currency to the U.S. Dollar and would buy and sell U.S. Dollars to keep the market exchange rates within a trading band of plus or minus 1% from the original ratio. The U.S. Dollar would be convertible into gold at a rate of US$35 per troy ounce. In effect, the U.S. Dollar took over the role held by gold under the previous international gold standard financial system.
The U.S. has enjoyed an enormous advantage of such a system because they are the only entity legally capable of creating more of the reserve currency, that being U.S. Dollars. Other nations were forced to buy large amounts of U.S. dollar reserves to maintain their currency within the trading band.
John Fitzgerald Kennedy
On June 4, 1963, John F.Kennedy signed a virtually unknown Presidential decree, Executive Order 11110, a mere four months before his assassination on November 22, 1963. This decree returned to the U.S. Federal government the Constitutional right to create and "to issue silver certificates against any silver bullion, silver, or standard silver dollars in the Treasury."
As a result, $4,292,893,815 of new "Kennedy Bills" were created through the U.S. Treasury instead of the Federal Reserve System. In 1964, Kennedy's successor, Lyndon B. Johnson, stated that, "Silver has become too valuable to be used as money." The Kennedy bills were removed from circulation.
Below are examples of the $2 and $5 dollar denominated "Kennedy Bills" (also known as "Red Seal Bills"). Note the 1963 date and words "United States Note" at the top instead of the familiar "Federal Reserve Note" wording.
The importance of these bills is not to be underestimated. The regular Federal Reserve Notes are created through the Fed who exchanges them for an interest-paying government bond. These "United States Notes" were directly created through the U.S. Treasury and backed by the silver held there.
There was no interest to be paid on these bills by the government (or more correctly, by the tax-payer) to the Federal Reserve.
Vietnam War
U.S. involvement in Vietnam began as far back as 1954, but the "official" position was that no combat missions were conducted until late 1963.
The official declaration of war on Vietnam in 1964 came as a direct result of two alleged attacks on two U.S. destroyers by North Vietnamese PT boats in the Gulf of Tonkin. A report released in 2005 by the National Security Agency indicated that the second attack likely never occurred.
During the Vietnam War, many American air commanders were convinced that rigid Rules of Engagement (ROEs) prevented an American aerial victory over North Vietnam during the Rolling Thunder air campaign form 1965-1968. These rules of engagement were declassified in 1985. Many were so restrictive that it was impossible to achieve effective results. Some of the rules included:
· North Vietnamese anti-aircraft missile systems could not be bombed until they were known to be operational;
· No enemy could be pursued if they crossed into neighbouring Laos or Cambodia;
· Critical strategic targets could only be engaged unless initiated by high military officials;
· Pilots were restricted from attacking enemy airfields, SAM sites, power plants, naval craft in some areas, a 30 mile area around Hanoi, and a 10 mile area around Haiphong;
· In many instances up until early 1967, U.S. pilots were not allowed to engage enemy fighters unless they themselves had been attacked first;
These rules of engagement were televised in North Vietnam thus enabling them to strategize their war tactics around them.
In 1966 Johnson lifted trade restrictions against the Soviet Union knowing full well that the Soviets were funding up to 80% of the North Vietnamese war supplies. David Rockefeller financed factories in the Soviet known to manufacture military equipment for North Vietnam.
The war in Vietnam was never meant to be won. It was intended to be sustained for the benefit of the central bankers who lent money for the war effort. The war resulted in the deaths of 58,000 U.S. soldiers and three million Vietnamese.
Nixon Unilaterally Closes the Gold Window
Escalating costs from both the Vietnam War and domestic social programs resulted in ever increasing amounts of U.S. Dollars being printed. In the early 1970s, the United States as a whole began running a trade deficit for the first time in the twentieth century. Foreign owners of U.S. Dollars began to question the ability of the U.S. government to reduce budget and trade deficits.
Increasingly, foreign nations, in particular the French under Charles de Gaulle, began to send the U.S. Dollars earned by exporting to the U.S. back to be redeemed in gold as legally entitled under the Bretton Woods Agreement signed in 1944.
The drain on U.S. gold threatened to completely empty the U.S. Treasury. To prevent this from happening, on August 15, 1971, President Richard Nixon unilaterally closed the gold window. He made the Dollar inconvertible to gold directly, except on the open market.
The severing of this last link between gold and paper money meant that all the world's currencies now "floated" against one another. The result was inevitable, with the "http://www.
This was the final step in abandoning the gold standard. All the central banks had to control now was the public's perception of inflation to allow them to create as much money as desired.
Central Bank Gold Auctions
On January 1, 1975, after 42 years, it became "legal" for individual Americans to own gold again. Anticipating the demand, many central banks sold off large quantities of their gold reserves. The effect was a decline in the "http://www.
Gold regained its previous nominal high of $195 set on December 1974, almost three-and-a-
The new Fed Chairman, Paul Volcker, appointed by Jimmy Carter announced a change in policy upon return from a conference in Belgrade concerning the global financial system. He announced that the U.S. Federal Reserve was switching its policy from controlling interest rates to controlling the money supply
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By 1982, interest rates had dropped and gold had fallen to $296 an ounce. Investors piled both into the stock market and gold. The price of bullion reached a peak of $510 an ounce at the end of January 1983. However, in the last four trading days of February 1983, "http://www.
Thus began the long bear market in gold and boom in equity markets.
The Rise of Debt
Further fuelling the rise in equities was the effective abandonment of the permanent debt ceiling of $400 billion set in March 1971. By late 1982, the public debt had tripled to $1.25 trillion. Presently, the public debt of the United States stands at over $9 trillion.
This explosion of debt led to worldwide monetary inflation as the U.S. still enjoys a de facto reserve currency status by virtue of history and an agreement made with OPEC in 1973 that world oil would be priced in U.S. Dollars.
Monetary inflation leads to the formation of economic bubbles wherein market speculators bid up the prices of assets to unrealistic highs. When all market participants have clambered into the market the market generally collapses when it becomes apparent that there is nobody left to buy.
There have been four notable economic bubbles formed since 1982:
· The global stock market boom of 1982-87
· The Japanese stock market boom of 1988-90
· The Dot-com boom from late 1994 to early 2000
· The U.S. and global housing market from 2001 to present-day
It is important to be aware of the fact that these booms, and subsequent busts, are not the result of free-market capitalism as commonly held. They are the direct result of monetary manipulation by central banks no different in principle than Soviet-era market intervention.
In Summary
The current Federal Reserve banking system is modeled after the European central banking system Americans revolted against during their War of Independence.
Every Dollar created under the present monetary system does not represent a tangible asset. It represents an I.O.U. from the government, and therefore the people, to the central bank. After three failed attempts, central bankers finally gained control the monopoly on the issuance of American money with the creation of the Federal Reserve in 1913.
There are two unavoidable results of the Federal Reserve System:
devaluation of the Dollar, and
accumulation of debt.
Rising prices is not intrinsic to free-market capitalism. It is a monetary phenomenon caused by increasing money supply. Money, like anything else, is subject to the laws of supply and demand. The more abundant the money, the lower its value.
If the amount of money were to remain constant relative to population, we would see a general decrease in the prices of goods as technologies and transportation efficiencies improved. This would be a boon to consumers.
Consider the rapid spread of telecommunications and computers, two industries where technological improvements have actually been able to outpace the price escalation caused by the monetary inflation of central banks. Lower prices have led to a surge in consumer usage. People don't hold onto their money in hopes of waiting for a better computer or phone. Quite often they buy a second or third one. The consumer base grows as well because for those who previously could not afford one now can do so.
Despite these blatant observations, conventional economic thought believes that decreasing prices are bad for the economy because it encourages saving. It is widely held that consumer spending, not saving, is what drives the economy.
This is a falsehood, perpetrated by those would stand much to gain by further and further indebtedness of the public. Savings leads to capital investment which is the real driver behind capitalism.
Debt
Every Dollar created is an instrument of debt lent out at interest. The extra money required to pay back the interest can only come from one place, that being the central bank. As such, the central banks must continuously increase the money supply.
Below are three measures that would establish an honest monetary system.
Repay the Public Debt
The U.S. government must begin by first balancing the annual budget and then begin reducing the public debt. This would reduce the tax burden and ultimately allow tax dollars to be spent only on services requested by the people and not to banking agencies.
Introduce a Hard Currency
A hard currency should be introduced that competes against Federal Reserve Notes. Each of these bills would be backed by a defined quantity of a hard asset, such as gold, that are fully convertible at any time. Such a system could be comprised of bills representing a number of grams of gold.
There should be no legislation regarding the exchange ratios between gold and any other commodity or fiat currency. The free market should determine what the price of silver or Euros is in gold.
Borrowers and lenders should negotiate an interest rate on any lending arrangement using the hard currency. There should also be no law requiring that people must use this new currency. Legal tender laws are needed to make people accept a bad currency, not a good one.
This hard currency would require banks to store gold in their vaults. Any bank without gold would be unable to issue out the hard currency either in cash or as a loan.
In essence, the hard currency is a paper receipt convertible on a 1:1 exchange basis with gold. The gold is the money; the paper receipt is merely a representation of the physical metal.
Abolish Fractional Reserve Banking
The practice of fractional reserve banking should be criminalized, as is any other form of fraud. No business should be able to lay claim to assets they do not have, let alone lend out these assets and charge interest on them. This would eliminate the phenomena of bank-runs whereby panicked depositors line up to withdraw their assets for fear that the bank is insolvent. A bank should be able to lend out $10,000, only if it has $10,000 to begin with.
http://goldnews.
The Panic of 1907
J.P. Morgan started a rumor that a prominent branch of the Bank of New York was insolvent . He knew this would cause mass hysteria that would affect other banks as well, causing people to withdrawal their money from the banks. As a result the banks were required to recall in their loans, causing people to sell their stock.
US Congressmen recommended a central bank which resulted in the Federal Reserve Act, which was written by the large banking interests. Congress passed this act in 1913 and Pres. Woodrow Wilson signed it into law.
From 1914 to 1919, the Federal Reserve Bank (FED) increased the U.S. money supply by 100 percent, resulting a large number of loans to banks and the public. Then in 1920, the FED called in mass percentages of the outstanding money supply, resulting in the banks to call in huge numbers of loans. As a result, runs on banks (lines of people wanting to pull their money out of the bank) and bankruptcies resulting in 5,400 banks outside the Federal Reserve system collapsed, further consolidation of the banking monopoly into the hands of a small group of international bankers.
From 1921 to 1929 the FED increased the money supply by 62 percent by making loans to the public and banks (at interest). A few months before October 1929, J.P. Morgan, Joe F. Kennedy, J.D. Rockefeller Sr. and Bernard Baruch quietly sold their stock holdings on Oct. 24, 1929 banks started calling in loans, and resulted in the collapsing of 16,000 banks. This allowed the international bankers to buy rival banks at a discount, but also to buy whole corporations at pennies on the dollar. And instead of expanding the money supply, the FED decreased the money supply, resulting in the great depression.
The gold standard under an executive order of the president, May 1, 1933, everyone in America was required to turn in all gold bullion and gold certificates (dollar bills redeemable in gold) to the Federal Reserve Bank. And at the end of 1933 the gold standard was abolished.
World War I cost the U.S. about $30 billion, most of it barrowed from the FED at interest, furthering the profits of the large U.S. banking interests.
Source: "The Money Masters " do the google thing to find it.
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1 comment:
The Federal Reserve Has Created the Risk of a Global Depression!
Please sign, publish or forward our Abolish the Federal Reserve Petition at
http://www.petitiononline.com/fed/petition.html to all your pro-freedom friends and associates.
The collapsing dollar, exploding oil and food prices, falling housing market, the subprime mortgage and growing credit crisis and stock market weakness are all a result of earlier Federal Reserve actions designed to maximize Wall Street and banking profits at the expense of productive, working people around the world.
Ron Holland, The Swiss Confederation Institute, Wolf Laurel, NC
PS Check out the July Las Vegas FreedomFest Conference www.freedomfest.com
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