CONTINUED PREVIOUS POST: ...In fact, the last time in American history the national debt was completely paid off was in 1835 after president Andrew Jackson shut down the central bank that preceded the Federal Reserve. In fact, Jackson’s entire political platform essentially revolved around his commitment to shut down the central bank. Stating that one point: “The bold efforts the present bank has made to control the government… are but premonitions of the fate that awaits the American people should they be deluded into a perpetuation of this institution or, the establishment of another like it.” Unfortunately this message was short lived. And the international bankers succeeded to install another central bank in 1913, the Federal Reserve. And as long as this institution exists perpetual debt is guaranteed. Now, so far we have discussed the reality that money is created out of debt through loans. These loans are based on a banks reserves, and reserves are derived from deposits and through this fractional reserve system. Any one deposit can create 9 times its original value. In turn, debasing the existing money supply raising prices in society. And, since all this money is created out of debt and circulated randomly through commerce, people become detached from their original debt, and a disequilibrium exists where people are forced to compete for labor in order to pull enough money out of the money-supply to cover their costs of living. As dysfunctional and backwards as all of this might seem there is still one thing we have omitted from this equation. And it is this element of the structure which reveals the truly fraudulent nature of the system itself. THE APPLICATION OF INTEREST... When the government borrows money from the FED or when a person borrows money from a bank it almost always has to be payed back with accrued interest. In other words: Almost every single Dollar that exists must be eventually returned to a bank with interest payed as well. But, if all money is borrowed from the Central Bank and is expanded by commercial banks through loans only what would be referred to as the “principal” is been created in the money supply. So then, where is the money to cover all of the interest that is charged? NOWHERE. IT DOES NOT EXIST. The ramifications of this are staggering for the amount of money owed back to the banks will always exceed the amount of money that is available in circulation. This is why inflation is a constant in the economy. For new money is always needed to help cover the perpetual deficit build in to the system. Caused by the need to pay the interest. What this also means, is that mathematically the faults and bankruptcy are literally build into the system and there will always be poor pockets of society that get the short end of the stick. An analogy would be a game of musical chairs: For the once music stops, somebody is left out to dry. And that is the point. It invariably transfers true wealth for the individual to the banks. For, if you are unable to pay for your mortgage, they will take your property. This is particularly enraging when you realize, that not only is such a default inevitable due to the fractional reserve practice, but also because of the fact that the money, that the bank loaned to you didn’t even legally exist in the first place. In 1969 there was a Minnesota court case, First National Bank of Montgomery v. Jerome Daly, involving a man named Jerome Daly, who was challenging the foreclosure of his home by the bank, which provided the loan to purchase it. His argument was that the mortgage contract required both parties, being he and the bank, each put up a legitimate form of property for the exchange. In legal language this is called consideration (a contracts basis. a contract is founded on an exchange of one form of consideration for another.) Mr Daly explained that the money was in fact not the property of the bank, for it was created out of nothing as soon as the loan agreement was signed. Remember what Modern Money Mechanics stated about loans? What they do, when they make loans is to accept promissory notes in exchange for credits. Reserves are unchanged by the loan transactions, but deposit credits constitute new additions to the total deposits of the banking system. In other words: The money doesn’t come out of their existing assets, the bank is simply inventing it, putting up nothing of it’s own, except for a theoretical liability on paper. As the court case progressed, the bank’s president Mr. Morgan took the stand. And in the judge’s personal memorandum he recalled that “the Plaintiff (banks president) admitted that in combination with the Federal Reserve Bank did create the money and credits upon its books by bookkeeping entry. The money and credit first came into existence when they created it. Mr Morgan admitted that no US Law or Statute existed which gave him the right to do this. A lawful consideration must exist and be tendered to support the Note. The Jury found that there was no lawful consideration and I agree.” He also poetically added: “Only God can create something of value out of nothing. And upon this revelation the court rejected the bank’s claim for foreclosure and Daly kept his home. The implications of this court decision are immense, for every time you borrow money from a bank, whether it is a mortgage-loan or a credit-card charge, the money given to you is not only counterfeit, it is a illegitimate form of consideration and hence voids the contract to repay, for the bank never had the money as property to begin with. Unfortunately such legal realizations are suppressed and ignored. And the game of perpetual wealth transfer and perpetual debt continues and this brings us to the ultimate question: Why?
Posted on: Tue, 20 Aug 2013 22:18:34 +0000
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