Over the last few months I have struggled with the notion of whether I should convey my thoughts to you regarding a subject that has been of great concern to me. I feel compelled to share them with you. This is how I see it.

As you probably know, there has been much publicity concerning the computer bug associated with the date 2000 (Also known as the Y2K Bug). Older systems leave off the first two digits of the year so that computers will confuse the year 2000 with 1900. This may sound like an easy problem to fix but it is not. Billions of lines of code must be checked manually to ensure Y2K compliance. The Defense Department estimates it will take until the year 2012 to complete this task. Also, there are millions of systems with embedded chips that need to be tested. The international networking of computer systems also magnifies the problem. Many experts predict power outages, disruption in banking activities, and many other computer related problems. Nobody knows exactly what may occur, but a potential problem certainly does exist.

My focus is to identify the financial implications associated with Y2K. The U.S. financial structure is based on a fractional reserve banking system. In simple terms this means that only a very small portion of the money you deposit in the bank is kept for you, the rest is lent out. If everyone wanted to withdraw their deposits at once the bank simply would not have the cash. Now, ask yourself a simple question, would you withdraw your money from the bank if there would be even the slightest chance of bank systems failures such as ATM shortages, check processing malfunctions, or lost or incorrect data? If you answered yes, then it is very possible that we will see bank runs similar to those of the great depression.

Remember that the Federal Reserve Bank prints just enough paper money to support the demand for cash, which is constantly recycled in and out of banks. Over 90% of our fiat money ($ backed by nothing) is computer entries. The Fed (Federal Reserve Bank) has already started to print more money in preparation for the Y2K panic. Induced inflation will be its by-product, but of equal concern is that the depletion of bank capital can trigger a liquidity crunch that may halt the gears of the financial markets.

To grasp the severity of the situation it is important to know how fractional reserve banking works. Under a fractional reserve banking system if you deposit $1000 in your local bank, your bank will then deposit this money at the Fed. At a reserve requirement of 10% your local bank can now lend out $10,000. Thus $1,000 deposited puts $10,000 into the system. This also means that money creation can only occur through debt. If all debt were eliminated the money supply would be zero. In the past, part of your deposit was backed by gold, now it is backed by human confidence. As Alan Greenspan puts it, "The abandonment of the gold standard made it possible for the welfare statists to use the banking system as a means to unlimited expansion of credit." The term 'unlimited expansion of credit' simply refers to the Fed's pyramid loan structure whose underlying value is based on the confidence of the American people. Thus, the intrinsic value of money is not backed by anything of substance (gold or silver), it is based solely on human emotion.

Financial markets only work when there is confidence; this confidence is based on the idea that men can manage their affairs rationally. If this confidence fades, then so does the market. The rendering in of a new millennium will test the soundness of a financial system that has its foundation built upon a debt pyramid structure. Can this foundation handle the Y2K storm?

Market speculation and historical evidence indicate that a stock market crash ensued by high inflation is a very realistic possibility. In times of instability, gold and silver have traditionally been a safeguard for social wealth. Central Bank intervention has kept gold and silver prices artificially low over the past two decades. Any movement toward true supply and demand forces would escalate prices considerably. An investment at this time in gold or silver coin would not only safeguard one's wealth, but also provide a virtual risk-free vehicle for wealth enhancement.

The panic prior to January 1, 2000 and the event itself have the potential to devastate markets. This is a real issue. Please take the time to consider how this may affect your investments.

J. C. Lyons

From Gold Eagle

-- Andy (2000EOD@prodigy.net), February 07, 1999

Answers

He is absolutely correct. Unfortunately many people are naive about the Federal Reserve and the implications of Y2K on this system.

In reality, the Federal Reserve is not Federal, and it's not a Reserve. It was created by a cartel of private banks. They thought it was pretty neat how they could give you money that doesn't exist, and if you didn't pay back the money that doesn't exist, with interest, they could take your possesions away from you.

Read a book by David Icke called "And the Truth Shall Set You Free"

-- (@@@.@), February 07, 1999.

@@@.@,

>They thought it was pretty neat how they could give you money that doesn't exist,

Did you accept this nonexistent money? If so, why?

>and if you didn't pay back the money that doesn't exist, with interest, they could take your possesions away from you.

Why did you sign a contract agreeing to pay back the money, with interest, if you genuinely thought it didn't exist?

And ... if you used that "nonexistent" money to purchase those possessions, that was fraud, wasn't it? And those possessions don't really belong to you, do they? So you have no legal claim to them?

If you don't pay back what you accepted from them, even though you NOW claim it didn't exist, you are not fulfilling your end of the contract, are you?

Or do you claim that this money is nonexistent only when you owe it to someone else, not the reverse? I.e., do you have a double standard regarding the existence of that money, denying its existence only when such denial is in your favor?

-- No Spam Please (anon@ymous.com), February 07, 1999.

Spamless, I think understanding will gradually come to you as we move into the year 2000 as to what non- existent money is.

-- Nikoli Krushev (doomsday@y2000.com), February 07, 1999.

Hi Andy: I see that you 'got around' to the gold eagle site after all. Great one, don't you think? Did you ever read the Y2K articles I mentioned - the three-parter one by Heuskin callerd "An iceberg called Y2K" - I would like your opinion on it if you did. And thanks for post, I hadn't been over there for a few weeks.

-- Rob Michaels (sonofdust@net.com), February 07, 1999.

Nikoli,

Don't patronize me as to my understanding of money. FRNs are a medium of exchange. Gold is a medium of exchange. FRNs and gold have different physical properties, leading to different uses (e.g., wallpaper, jewelry) aside from their uses as media of exchange, and also leading to differing acceptability as media of exchange in various circumstances. I am fully aware of these considerations.

@@@.@'s statements about nonexistent money had nothing to do with Y2k. They were just another example of a scam that's been going around for decades in which people borrow or accept Federal Reserve Notes, use those Federal Reserve Notes to purchase goods and services, then want to claim that those Federal Reserve Notes weren't "real" money, so somehow they are justified in refusing to pay back their loans.

That stuff is just plain dishonest.

As I point out with my questions to @@@.@, if those who claim that FRNs are nonexistent money were sincere, they wouldn't accept FRNs in the first place, and wouldn't use them to purchase goods and services.

-- No Spam Please (anon@ymous.com), February 07, 1999.

No Spam, I agree it is dishonest to take a loan in good faith and not repay it when you have the ability. I didn't see any reference to that in the post. This is Y2K related because the artificial debt we are currently paying 400 billion dollars per year on via our income taxes is about to mushroom to triple that. Now I have a real problem with paying taxes, and 30% of that money is stolen, yes STOLEN, right off the top by the Federal Reserve. Which is as stated a private collection of filthy rich bandits who are holding the entire world hostage to their purse strings. The prospect of another depression which does not collapse the government means that the percentage of our taxes stolen by the fed will increase to 60-75%. Where does this insanity stop?

-- Nikoli Krushev (doomsday@y2000.com), February 07, 1999.

No Spam is quite correct. Money has value only because we all agree that it has value. Without this agreement, it has no value.

Andy's wailing about 'backing' misses exactly this point. Let's say it was backed by gold. Gold itself has value only because we agree that it has value (except for some industrial uses irrelevant to most of us). Why do we agree that gold has value? Because we expect others to accept it in exchange for what we really use, just the same as any other medium of exchange. If people decide gold has no value (you can't eat it, after all), then gold will have no value either. For Gold Eagle to say that precious metals have 'substance' is only self- serving. Precious metals have no more intrinsic value than dollar bills -- they are a pure medium of exchange just like the dollars (only harder to deal with).

Andy's argument that printing bills will lead to inflation, is simply nonsense. Bills (physical currency) amounts to only a very tiny fraction of all money, and the FED is simply replacing some bits on computer tape with physical bills, which doesn't increase the money supply at all, just shuffles it around a tiny bit.

Nikoli is correct, though. Most 'money' in our economy is tied up in assets, or more accurately, our expectations of the future value of these assets (stocks). Some tiny startup companies have market valuation greater than much larger, established concerns. This level of valuation is currently absurd, but it's really a bet on the future. Soon enough, it will turn out that the future ain't nearly so bright, and the house will call in these bets, as happened in Japan.

If you have just enough food for yourself, and your neighbors have gold and are starving, will you trade them your food for their gold and starve yourself? But at least you can be satisfied that you died rich, while your neighbors survived poor. After all, you had the *real* money, didn't you?

-- Flint (flintc@mindspring.com), February 07, 1999.

"If people decide gold has no value (you can't eat it, after all), then gold will have no value either"

This is an important matter, deconstructed at some length here:

Metals, Currency, Consumables, and the Post-Crisis Migration of Values, Parts I and II: http://www.provide.net/~aelewis/gold/crisisv1.htm http://www.provide.net/~aelewis/gold/crisisv2.htm

-- Alan (a@b.c), February 07, 1999.

Nikoli,

>I agree it is dishonest to take a loan in good faith and not repay it when you have the ability. I didn't see any reference to that in the post.

Please reread @@@.@'s paragraph from which I quoted earlier.

@@@.@>In reality, the Federal Reserve is not Federal, and it's not a Reserve. It was created by a cartel of private banks. They thought it was pretty neat how they could give you money that doesn't exist, and if you didn't pay back the money that doesn't exist, with interest, they could take your possesions away from you.

The "if you didn't pay back the money" is the clear reference to loans.

Many times before I've seen this sort of statement about FRNs being "nonexistent" money or "not real" money, coupled with some inference that wanting a borrower to repay a loan was somehow unjustified because of that contention. It's a dishonest point of view.

>This is Y2K related

but there is no Y2k reference in the part of @@@.@'s post about which I was commenting. I was not commenting on @@@.@'s entire posting - only the part about "nonexistent" Federal Reserve money and paying it (loan) back.

-- No Spam Please (anon@ymous.com), February 07, 1999.

Alan:

I read the deconstruction. Thanks for the references. Seemed to me that it was mostly two people violently agreeing about the basics. Both agreed that, basically, precious metals have value because of agreement that they do. No agreement, no value. The argument that gold has intrinsic value because it's pretty seems weak, in the sense that attractiveness isn't very useful, all in all. The argument that people are always likely to want it, however little actual utility it has, is likely true.

In a collapse, yes, people will likely accept FRNs because you can't have much of an economy beyond barter if your currency is something your customers don't possess. And barter is very clumsy.

In something less than a collapse, the relative value of gold will probably be more stable than the relative value of FRNs. Whether we experience inflation or deflation will determine which was better to hold.

-- Flint (flintc@mindspring.com), February 07, 1999.

The neat thing about gold is that all you have to do is look at it to understand its' value. Does anyone know why that guy named George Washington didn't want us to ever leave a metal standard?

-- Reporter (foo@foo.bar), February 08, 1999.

"If the American people ever allow the banks to control issuance of their currency, first by inflation and then by deflation, the banks and corporations that grow up around them will deprive the people of all property until their children will wake up homeless on the continent their fathers occupied." Thomas Jefferson, 1791

"It is apparent from the whole context of the Constitution as well as the history of the times which gave birth to it, that it was the purpose of the Convention to establish a currency consisting of the precious metals. These were adopted by a permanent rule excluding the use of a perishable medium of exchange, such as of certain agricultural commodities recognized by the statutes of some States as tender for debts, or the still more pernicious expedient of paper currency." Andrew Jackson, 1836

"There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose." John Maynard Keynes, 1920

-- Nathan (nospam@all.com), February 08, 1999.

Andy -- you've sure been on a roll this weekend. Lot of good stuff.

-- a (A@AisA.com), February 08, 1999.

No Spam and those of similar opinions: Your opinions on money, credit, and interest are to reality as intestinally processed spam is to steak.

All others: check out
    http://www.e-gold.com

-- A (A@AisA.com), February 08, 1999.

I have read that the only way the money-supply grows is by the Reserve Banks extending debt. To either hold steady (or shrink!) the "debt bubble" would cause a shrinkage of the money-supply, which in turn would cause a collapse.

Any comments as to the accuracy of this?

-- Anonymous99 (Anonymous99@anonymous.com), February 08, 1999.

"Hi Andy: I see that you 'got around' to the gold eagle site after all. Great one, don't you think? Did you ever read the Y2K articles I mentioned - the three-parter one by Heuskin callerd "An iceberg called Y2K" - I would like your opinion on it if you did. And thanks for post, I hadn't been over there for a few weeks."

Thanks Rob, just started a new job so I haven't had a chance yet - but I certainly will.

The Gold Eagle site is superb.

No Spam and others (Flint). I'm sorry to say that you haven't grasped what is going on because you are unaware, as is 99% of the population, of the game that is being played. No Spam, you've got the wrong end of the stick as regards fraud - no one suggests that you do that. We are all stuck with FRB as it is just too ingrained worldwide. That does NOT however mean that we should be IGNORANT - that is what is wanted of us after all - did you know that???

Go away and read "And the Truth Shall Set You Free" by David Icke - digest the annotated information, then come back to me and debate publically on this forum the issues that you have brought up.

I don't want to be rude but I don't have the time to waste with you if you don't have the basics. The book costs $14 - check it out.

-- Andy (2000EOD@prodigy.net), February 08, 1999.

From http://www.fame.org/research/library/chc-001.htm

The State governments may very properly authorize corporate bank ing to any extent they please; but no constitutional power remains with them to authorize the creation of currency in any form whatever; and there is no more reason why bankers should issue fictitious credits, whether in handbooks under the name of "deposit," or in notes, than that an insurance office, or a trust company, or pawnbroker, or any individual trader should do the same thing. Whenever a bank discounts a bill or security that forms the fund out of which it is itself discounted, the transaction is not banking but currency-making; and it is a cheat, for there is no such value in existence as such currency pretends to be or to represent. It is simply a fictitious credit, and it makes not a particle of difference in principle or effect whether the credit thus created is circulated in checks, or notes, or in money itself. For instance, suppose A obtains a credit of this character from his bank for $10,000; he has then $10,000 o{theoretical "money" more than he had before at the debit of his cash account, and the bank holds so much more of theoretical "deposit." If he draws the whole sum in specie, the net liabilities of the bank contain the augmentation, its assets and liabilities being reduced alike - and, unless the specie is exported, the volume of national currency also contains the augmentation of $10,000; it will appear probably on deposit in other banks. If this check is answered in bank notes, the effect will be the same; the deposit will appear in other banks; or, if he merely passes his check to another bank, it goes to somebody's credit and there as an additional deposit. In any event but that of exporting the coin the national currency is augmented; and if the bank currency be convertible at par, the local value of money is degraded $10,000 by the fictitious deposit, whether it appear in the accounts of banks or in the hands of the people or the government. Or, if it be convertible at a discount, the net sum that can be obtained for it in gold is the measure of the degradation of the value of money.

From http://www.dean.usma.edu/socs/econ/concept/$create.htm

MONEY CREATION PROCESS

The process by which a portion of each deposit into the banking system is held as required reserves by the commercial bank and the remainder is loaned to other agents in the economy.

In a fractional reserve banking system, the central bank (the Federal Reserve in the United States) specifies what percentage of each deposit must be held as required reserves (this is called the required reserve ratio). The bank can loan out the remainder [(1-rrr) * deposit] which ultimately is redeposited into a commercial bank which continues the process.

The maximum amount of money that can be "created" in a fractional reserve banking system is the new deposit * (1/rrr).

For enough numbers to make your head hurt, see http://gsmith.pomona.edu/Iman.html and http://www.smsu.edu/contrib/econ/faculty/olsen/courses/eco155/emoney. htm

You are a bank. I deposit $1000 with you. You loan the next guy $900. He deposits it. Bingo. You now have the basis for another loan. So, you loan the *next* guy $810. He deposits it. Like magic, you're now able to lend someone else $729. Then, he deposits it, and...

Repeat until yonder cows come home.

Now, at any given point, *all* of the "money" continues to "exist". The initial $1000 deposit has *grown*. It has *multiplied*.

I'm sorry you can't grasp the concept.

-- Andy (2000EOD@prodigy.net), February 08, 1999.

Another great book about this subject is called The Secret World of Money by Andrew Gause, who is a monetary historian.

-- Rob Michaels (sonofdust@net.com), February 08, 1999.

No Spam,

I was not trying to say that people shouldn't pay back money they borrow. However, the taxation and interest system that has been developed is illegal and people are being robbed.

-- (@@@.@), February 10, 1999.

(@@@.@),

How is the taxation and interest system illegal?

Will you please be more detailed about "people are being robbed"? Which people? In what respect are they being robbed?

-- No Spam Please (anon@ymous.com), February 11, 1999.

No Spam. I trimmed this from an article about the Fed, It offers a simple explanation of how the fed steals our money. But it doen't cover nearly all the angles.

The second method is: The Citizens allow the bank to print $500 billion in currency (cash). The bank pays for printing costs, ink, and paper. The Citizens do not charge the bank any interest for use of the $500 billion in printed currency. The bank uses the $500 billion cash to buy a $500 billion government bond which pays the bankers interest. The bank keeps some of the bonds and sells, for a fee (10%), some of the bonds to the public. The bank can buy back the bonds from the public simply by printing more money. The bankers can create inflation and depressions by manipulating the amount of currency in circulation. The FED operates exactly like this today. It also prints money (through the U.S. Treasury) and uses this printed money to buy loans from other banks. This money has created our inflation. We give the bank cash interest-free, then they charge us interest on our own currency.

Now what they left out here is that the debt created when those bonds were sold, we pay interest on via our taxes. Beginning to get the picture?

-- Nikoli Krushev (doomsday@y2000.com), February 12, 1999.

Oh, almost forgot, while we are paying this interest on the national debt via our taxes, we still owe the PRINCIPLE. What this boils down to is that for every dollar the fed creates out of thin air, they make 4bucks and change as profit. If this doesn't qualify as theft what does? Their money is unconstitutional, unbacked, and meets every definition of counterfiet. It is the largest con game ever perpetuated in the history of the world.

-- Nikoli Krushev (doomsday@y2000.com), February 12, 1999.

Try this one.

The IMF claims poverty and harasses our government for more funds in order to destroy more economies. Our Congress relents (after putting on a good show) and asks the FED for XX billion dollars. The FED enters some numbers on a computer system and lends the XX billion dollars to the US government.

This off-budget expense is lent to the US because the US is actually running deficits of around $130 billion as of fiscal '98 (and, incidentally, at a much higher rate for fiscal '99). The US taxpayers are now paying interest to the FED for money we gave to the IMF, which was made up out of thin air by the FED. In reality, we, the US taxpayers, are funding the tool of a consortium of G7 central banks. Were on the hook for both the principal amount and the interest payments. We will pay this interest forever or until the Republic collapses, whichever comes sooner.

The IMF then lends this money to one of the minor governments to keep their interest payments current on previous loans that the IMF extended. Frequently, the money lent to these minor governments go straight into the pockets of a few people running the government while the People of these countries are saddled with interest payments on this money. These interest payments, too, will continue forever or until that country collapses, which, interestingly, appears to be happening with increasing frequency these days.

Nice work if you can get it...

-- Nathan (nospam@all.com), February 12, 1999.

No Spam, you also asked why the current income tax system was unconstitutional, and illegal (Same thing) I clipped this from an essay and it shows why. The article was way to long to put the whole thing here so a little background. The constitution made no provision for a Federal Income tax. Tax revenues were to be raised by apportionment from the various states, excise taxes, and tarrifs on foreign trade. This is the constitutional limit on Federal Tax power. They attempted to impose an income tax and the supreme court ruled it unconstitutional because it violated the apportionment clause of the constitution. They then amended the constitution with the 16th amendment to bypass this. Now for the rest of the story.Concerning taxes, they set up the most simple and equitable tax system devised by man up to that time. Article I, Section 2, clause 3 is the apportionment rule.

"Representatives and direct Taxes shall be apportioned among the several States which may be included within this Union, according to their respective Numbers, which shall be determined by adding to the whole Number of free Persons, including those bound to Service for a Term of Years, and excluding Indians not taxed, three fifths of all other Persons. The actual Enumeration shall be made within three years after the first meeting of the Congress of the United States, and within every subsequent Term of ten Years, in such a Manner as they shall by law direct."

Then in Article I, Section 8, we find:

"The Congress shall have Power To lay and collect Taxes, Duties, Imposts, and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts, Excises shall be uniform throughout the United States."

The first authority (Art I, Sec 2) allows for direct taxes. The Framers expected this taxing power to levied on land and buildings only. Being apportioned meant that if State A had 20 percent more population than State B, State A was required to send 20 percent more money to the national government as their share for the expense of government. This was the reason for census taking which is ordained in the same section. The feeling at the convention was that direct taxation should not be used except when absolutely necessary.

The power granted in Art I, Sec 8 was for an indirect tax and this had to be uniform throughout the country. As you can see, it involved duties, imposts (tax on imports) and excises and were meant to be taxes on consumption. Whether is was liquor, tobacco or horse carriages, whatever, it was on consuming or using the item. It was assumed that this would be the chief source of direct income for the feds for years to come. And it was.

In checking through The Federalist Papers to find their intention concerning taxes, not one word is ever mentioned that they were going to tax individuals directly. Where did we go wrong? None of these powers diminished the power of the states to tax their citizens. Hamilton, in paper No. 32, points out "Under the plan of the convention, they retain that authority in the most absolute and unqualified sense; that an attempt on the part of the national government to abridge them in the exercise of it would be a violent assumption of power, unwarranted by any article or clause of its Constitution." (Any reference to paper no. in this series refers to The Federalist Papers.)

Let's jump into our time machine and come forward to 1894 when Congress passed a law to tax income. In 1895, the Supreme Court threw it out because they said it violated the Constitutional requirement that all direct taxes be apportioned. The only way the power brokers behind our government were going to beat this roadblock was to propose and pass an amendment to the constitution doing away with the requirement for apportionment.

In 1909 the Sixteenth Amendment was proposed and sent to the states for their approval. The hue and cry was "Soak the Rich - Make them pay for government! The average citizen will NEVER have to pay any income taxes!" This is the one which the bureaucracy claims is their authority to tax you and me but they have got big troubles with this one.

Let me first point out some absolutes in our Constitution. The power in the document for the business of government was granted by WE THE PEOPLE and can ONLY be altered by us. Article VI states that the Constitution is the supreme law of the land and all laws passed have to conform to the permission given by us. Everyone who works for the feds in any capacity has to take an oath or affirmation to God to support the document.

To be President of the United States, a person MUST be a natural born citizen of the United States. (Art II, Sec 1)

This is a fixed, explicit command. There are NO exceptions allowed. No emergency allowances or any amendment saying anyone but a natural born citizen can be president. This is the only requirement in the entire document that a candidate be natural born. It's obvious the Founders put it there for a specific purpose.

July 31, 1909, the proposed taxing amendment was introduced into Congress by Philander C Knox who was play acting as secretary of State. The man who was acting as president was William Howard Taft.

Taft was born in Cincinnati, Ohio on September 15, 1857. SURPRISE . . . Ohio was NOT admitted to the Union until August 7, 1953! At the time Taft was elected to be president Ohio was simply a territory. It was not a state which means he was not a natural born citizen. Our Constitution was violated. He was not eligible to be president by any stretch of your imagination.

Taft was not president and his illegal lackeys such as Philander C Knox were not officials of the government. They introduced this amendment illegally into Congress. It is therefore an unconstitutional act and of no legal consequence. So our illustrious Congress hits the panic button in a frantic effort to correct one big booboo. In their limited 'wisdom', they passed a Joint Resolution admitting Ohio as a full and equal member of the union. (Public Law 204, 83rd Congress, 1st Session).

Section 2 of that resolution states: "This joint resolution shall take effect as of March 1, 1803. Approved August 7, 1953." You don't need a calculator to show that it's backdated by 150 years. That's ex- post facto law.

They CAN'T do it. Ex-post facto law is explicitly forbidden! It's a conspicuous violation of another command in our Constitution which states: "No . . . ex post facto law shall be passed." (Art I, Sec 9) This was added protection for our citizens. An act which was legal one day could not be declared illegal a day, a week, or even years later. NO law can be predated by one day. We didn't agree to any change through the amendment process. That guaranteed protection of no ex post facto law is still the law of the land.

From where do they assume such a power especially when there are explicit commands forbidding what they did? First they believe that we are a bunch of country hicks and it's really none of our business what they do to run the country. Their stinking arrogance shows that! Most are lawyers which, they feel, puts themselves above us. They are just more equal than we are.

Two amendments which are absolute prohibitions to their assumption of powers we did not give are the Ninth and Tenth. These are the two amendments bureaucrats insist do not exist.

ARTICLE IX THE ENUMERATION IN THE CONSTITUTION, OF CERTAIN RIGHTS, SHALL NOT BE CONSTRUED TO DENY OR DISPARAGE OTHERS RETAINED BY THE PEOPLE. ARTICLE X THE POWERS NOT DELEGATED TO THE UNITED STATES BY THE CONSTITUTION, NOR PROHIBITED BY IT TO THE STATES, ARE RESERVED TO THE STATES RESPECTIVELY, OR TO THE PEOPLE.

These two absolutely tell everyone that the federal government is a government of enumerated and limited power. They are the fence that we built around their operational powers to keep them from exceeding what we allowed. Why do you suppose they can't read and understand these?

Madison insisted that the authority of the new national government is no greater under the new constitution than it was under the Articles of Confederation. Other than the power to regulate commerce, no new powers were given to the feds. The powers they had under the Articles were given vigor (to quote Madison) and the power to enforce.

"The powers delegated by the proposed Constitution to the federal government are few and defined. Those which are to remain in the State governments are numerous and indefinite. The former will be exercised principally on external objects, such as war, peace, negotiations and foreign commerce; with which last the power of taxation will, for the most part, be connected. The power reserved to the several States will extend to all objects which, in the ordinary course of affairs, concern the lives, liberties, and the properties of the people, and the internal order, improvement and prosperity of the State." Madison, paper no. 45.

Another problem surfaces under this Public Law making Ohio a member of the Union. They used a resolution to make the law when the intent of the Founders was for only bills to become law. Resolutions are to express an opinion or to censure some person or action but were never to become law.

Congress knew very well they were violating the Constitution This 'law' was buried for twenty years before someone found it while doing research. And they tell us that ignorance of the law is no excuse!

Public relations people at the IRS are real quick to tell Americans that the Supreme Court decided that the Sixteenth Amendment is constitutional. This is a stinking lie! The case they cite as proof is called Brushaber vs Union Pacific RR, (240 US 1, 1916.) There is NO lawyer, bureaucrat or otherwise, no researcher that can point to a statement in that finding that the Supreme Court rendered a decision saying the 16th Amendment is constitutional. These people must be using Orwell's newspeak now. The case didn't even involve the 16th amendment!

These same PR people then tell us that if we don't like the tax assessed, we can go to Tax Court to challenge the IRS. This, they say, meets the requirement of due process of law. What a crock. I still haven't figured how twisted a mind must have been to come up with that one!

Due process of law is guaranteed by our Fifth Amendment. It begins with the Constitution. If any link is broken between the Constitution and the law as it operates, there is no due process of law. Due process of law is only operative when the requirements of the Constitution are being followed.

We pointed out earlier about Article VI (the Supremacy Clause). Any 'law' which is passed outside the authority in the document, is NO LAW . . . due process is then inoperative and we are not required to obey the law. It's that simple.

-- Nikoli Krushev (doomsday@y2000.com), February 12, 1999.

"Now, at any given point, *all* of the "money" continues to "exist". The initial $1000 deposit has *grown*. It has *multiplied*.

I'm sorry you can't grasp the concept. -Andy"

I'm sorry Andy, but you are mistaken. I strongly urge you and the others here to read "The Debt Virus" by Jaikaran.

In point of fact, when any of the fractional loans you mentioned are paid back, they *cease to exist*. While this does not occur on the books of your local S&L, this is precisely what occurs at the top. All money is created from debt in our system and when the final debt is paid, the money ceases to exist. It DOES NOT PILE UP SOMEWHERE TO BE LOANED AGAIN!

As Jaikaran so clearly explains, the fatal flaw in the system (besides the obvious one that we don't need the "Federal" Reserve) is the money to pay the interest is not created, so there is always less money in the system than is needed to pay back all debts. This is not intuitively obvious due to the enormity of the system. Jaikaran's explanation is worth the price of admission. All dollars are borrowed into existance and disappear into cyberspace upon the extinguishing of the loan that gave them birth.

-- Will Huett (willhuett@usa.net), February 12, 1999.

Another great book which shows how the fed is a private cartel is "The Creature From Jeckyll Island," about the secret meeting between the Morgan/Rothschild bankers arranged by Wilson's eminence grise, Col. Mandel House, to create the federal reserve bank. As for the nature of our money, E. Coli said it best several threads ago when he proposed the "Peter Pan" analogy: "if all the children clap their hands and believe, then it's real." It's when the clapping stops that things will get ugly.

-- Spidey (in@jam.com), February 12, 1999.

Will, your answer is partially correct but it misses the main point. The FED is a privately owned bank and as such it's profits are paid to it's shareholders. If you take the total amount of interest we have paid on the national debt since 1913 plus the interest earned from the resale of the bonds, plus all the deficiet foreign aid (Multiplied by 2 plus 10%) and the outright interest earned from the total money supply loaned from the fed to regional banks you begin to grasp the amount of money we are talking about here. The FED has steadfastly declined to be audited, becuse if it ever became public knowledge how much they were siphoning off the top of our economy there would be an instant revolution. Taking just these factors I have listed into account I would estimate that the controlling families netted approximately one trillion dollars last year alone. Stop and think about that for a moment. Only a small percentage of that money was put back into circulation in the United States. Most of it was converted into precious metals and resides in Swiss vaults where it is secure from Nationalization or Siezure should the American people wake up to this farce and demand restitution. One year, one trillion dollars. How much did GM make last year? They actually had a product to sell.

-- Nikoli Krushev (doomsday@y2000.com), February 12, 1999.

Will,

Thanks for your response - I think anyone who has studied the history of money, the machinations at Jekyl Island, the illegal creation of the FED and all the subsequent money supply manouevres will be left in no doubt how we are all being robbed absolutely blind. I really don't have the words to express my disgust at the misery that this "ponzi" scheme imposed by the elite has caused the people of the world - not just Americans. I think this is what I was trying to get across to people. Unless you do some research on your own you will never grasp the enormity of this crime to humanity.

Cheers, Andy

-- Andy (2000EOD@prodigy.net), February 12, 1999.

Nikoli,

Your first two Feb. 12 postings are full of factual errors. Please read an accurate account of Federal Reserve System (FRS) operation written by someone with no axe to grind.

Not liking the FRS is one thing. Distorted descriptions of it are another. I think you'll have more success in convincing folks that the FRS is a bad thing if you restrict your statements about it to ones which are factually correct.

>The Citizens allow the bank to print $500 billion in currency (cash).

(I presume that by "the bank" you mean the FRS.)

No, the FRS prints no currency. Only the Treasury Department prints currency. Federal Reserve Notes (FRNs) are so called because the Treasury has an account at the FRS through which it distributes currency to financial institutions.

>The bank pays for printing costs, ink, and paper.

Substitute "Treasury Department" for "bank".

>The Citizens do not charge the bank any interest for use of the $500 billion in printed currency.

... for the simple reason that the FRS does not have the $500 billion in printed currency.

>The bank uses the $500 billion cash

No, the FRS does not have the $500 billion cash.

>to buy a $500 billion government bond which pays the bankers interest.

Interest on government bonds is paid to bondholders. There is no $500 billion bond at or owned by the FRS.

>The bank keeps some of the bonds and sells, for a fee (10%), some of the bonds to the public.

This appears to be a mangled version of the procedure by which anyone can purchase government bonds at a Federal Reserve Bank (FRB). There is no fee -- not 10%, not 1%, not 0.1%. (But you pay for your own transportion to get there.) The bonds sold at FRBs are Treasury bonds. Money from sale of them goes into the Treasury's account at the FRS, not to the FRS itself.

Perhaps the "10%" originated as a misunderstanding of the minimum denomination of Treasury bonds: $10,000. (No, I'm not talking about U.S. Savings Bonds.) For definitions of Treasury "bonds", "bills", and "notes", see www.treas.gov or similar site.

Or maybe the "10%" refers to the situation several years ago when the interest rate on Treasury securities was that high.

Or maybe it arose as a misunderstanding of the procedure by which interest is paid on Treasury notes or bills. (The purchaser of a note or bill pays the face value, then receives the interest at purchase time via a refund of a portion of the face value, then receives the face value of the security at maturity.)

>The bank can buy back the bonds from the public simply by printing more money.

Another distortion.

Anyone can redeem a government bond at an FRB. The money to redeem the bond comes from the Treasury's account at the FRS, not the FRS itself.

>The FED operates exactly like this today. It also prints money (through the U.S. Treasury)

Only the Treasury prints money. The Treasury distributes money from its accounts in the FRS.

>and uses this printed money to buy loans from other banks.

Substitute "make loans to" for "buy loans from".

>We give the bank cash interest-free, then they charge us interest on our own currency.

Will you please provide more detail on exactly what you mean here?

If you were writing about ordinary financial institutions, then so what? Yes, many banks do not pay interest on demand deposit ("checking") accounts. Others (such as mine) do. Shop around.

Financial institutions charge interest on loans. If one doesn't like that, one has the choices of (a) not borrowing, or (b) finding someone who will lend money without interest. If you lend money, you have the choice of charging interest or not.

>Now what they left out here is that the debt created when those bonds were sold, we pay interest on via our taxes.

So? Anyone who's paid attention to discussions of the federal budget knows that interest payments on the national debt use up a lot of the government's tax income. That's why the size of the national debt scares me -- when interest rates rise there will be a Very Big problem.

>Beginning to get the picture?

Yes. You're condescending without the factual basis to justify that attitude.

>Oh, almost forgot, while we are paying this interest on the national debt via our taxes, we still owe the PRINCIPLE. What this boils down to is that for every dollar the fed creates out of thin air, they make 4bucks and change as profit.

As explained above, interest on the national debt goes to the Treasury, not the FRS.

>If this doesn't qualify as theft what does?

It qualifies as distortion of fact.

>Their money is unconstitutional, unbacked, and meets every definition of counterfiet. It is the largest con game ever perpetuated in the history of the world.

Your argument would be more convincing if it had the facts straight about the FRS.

-- No Spam Please (anon@ymous.com), February 12, 1999.

No Spam, The article I posted is only one of about a thousand just like it scattered across the web. I would be interested in seeing the article from which you gleaned your information, it smacks of government spin and disinformation to me. I did not write that article, most of it is posted verbatim and only a couple of paragraphs were condensed by me to save space and reading time. I see nothing different in it than any other story I have EVER read on the Fed.

-- Nikoli Krushev (doomsday@y2000.com), February 12, 1999.

Here's another one with an economist point of view.

THE FEDERAL RESERVE SYSTEM: A FATAL PARASITE ON THE AMERICAN BODY POLITIC by Edwin Vieira, Jr.

INTRODUCTION

Although the press, the media, and major political figures never mention it, the major cause of the financial dangers facing America today is the incestuous relationship between the national government and the quasi-public, but largely private banking cartel deceptively called the Federal Reserve System (FRS). Although historians can state with little difficulty when various stages in the establishment and evolution of the FRS took place, understanding what the FRS has done to America's money, and how and why the FRS has done it, is not quite so easy. Rather, it requires careful attention to certain critical details of American monetary and banking theory and history that are usually forgotten in discussions of the problems the FRS has caused.

ANALYSIS

I. Most contemporary debate on the FRS focusses on whether what people call the "dollar" should, in some way, be "linked to" or "backed by" gold or another valuable commodity. The fundamental, unexamined, and utterly fallacious assumption in this debate is that the paper currency the FRS generates, the Federal Reserve Note (FRN), is, as a matter of fact and a matter of law, a "dollar" at all. As American constitutional law and history show, the FRN is not a "dollar", has never been declared by Congress to be a "dollar", and could never be an actual "dollar" notwithstanding all the statutes or resolutions Congress might enact. Rather, as cited in the Constitution and as historically defined in the Coinage Act of 1792, a "dollar" is a specific coin containing 371-1/4 grains of fine silver.1 Very simply put, the Constitution fixes the monetary unit of the United States as this (silver) "dollar", empowers Congress to coin silver and gold coins the values of which are to be "regulate [d]" in relation to the "dollar", prohibits any government from issuing what the Founding Fathers denominated "Bills of Credit" (and what we today would understand as paper currency redeemable in silver or gold), and outlaws any form of "legal tender" except silver and gold coins. Thus, from the constitutional perspective, it is literally senseless to talk about making the "dollar" redeemable, or adopting a "silver-" or "gold-backed" "dollar". And that such debate as occurs on the FRS and the FRN fixes on this senseless point demonstrates how confused the American people are concerning their own monetary system.

II. Defining the "dollar" constitutionally, however, is only the first step in explaining the real problem the FRS poses. Three other matters require careful consideration:

First, the evolution of the FRS exemplifies the typical historical devolution - or corruption - of monetary systems throughout the world in the last two centuries from commodity money, to fiduciary money,to fiat money. Here, accurate definitions of various forms of money are useful.

A commodity money is a medium of exchange the units of which are fixed amounts of an actual commodity that has value other than as money alone. Historically, silver and gold coins of known, standard weights and designs have emerged as the preferred commodity monies of the entire civilized world. In the case of a commodity money, the actual commodity - silver or gold - is both the medium of exchange and the standard of value (that is, the unit in which prices are stated in the marketplace). The supply of commodity money is self- limited by the costs of mining, refining, and coining silver and gold. New supplies of commodity money will be coined only to the extent that coinage is economically profitable in comparison to alternative investments of the capital needed to mine the precious metals.

A fiduciary money is a medium of exchange composed of some intrinsically valueless substance (such as paper) which the issuer promises to redeem on demand in a commodity money (such as silver or gold coin) or in a monetary commodity (such as silver or gold bullion). Historically, private bank notes and government treasury notes were fiduciary monies in general circulation prior to the 1930s. In the case of a fiduciary money, the paper promise to pay is the medium of day-to-day exchange, but the actual money and the ultimate standard of value remains the promised medium of payment, the silver or gold coin with which the note is to be redeemed. The supply of a fiduciary money is also self-limited by the requirement of redemption. In a free-market system, new supplies of a fiduciary money will be issued only to the extent the issuer is confident it can satisfy demands for redemption of its notes in a commodity money. The condition "in a free-market system" is crucial, because the self- limiting aspect of fiduciary money historically has failed in an economic regime in which the government or powerful private interests license the issuers of fiduciary monies to suspend or repudiate entirely their promises to redeem those monies on demand in coin.

Finally, a fiat money is a medium of exchange composed of some intrinsically valueless substance which the issuer does not promise to redeem in a commodity or a fiduciary money. Because a fiat money has no direct legal connexion to a commodity money (in terms of redemption) and, therefore, no real economic cost to its production, the supply of a fiat money can never be self-limiting; and the value of a fiat money is always largely a matter of public confidence in the economic or political stability of the issuer. For these reasons, historically almost all fiat monies have self-destructed in what is popularly called "hyperinflation" (that is, extreme decreases in purchasing-power) caused by either unlimited increases in the supply of those fiat monies by the issuers or accelerating loss of public confidence in the continued value of the monies or the economic or political fortunes of their issuers, or both.

Second, the theory and history of fiduciary money (which is also largely the theory and history of banking) must always focus on the ever-present problem of redemption. Emphasis on the noun "problem" is warranted, because a fiduciary money is, by definition, a promise to pay the real, commodity money of the country. A piece of commodity money - typically, a silver or gold coin - is itself payment because it contains a fixed weight of precious metal. But a unit of fiduciary money - typically, a bank or government treasury note - is only a contingent and uncertain payment that depends upon the ability or the willingness of the issuer to redeem. And there always exists a temptation for issuers to renege on their promises to redeem. Thus, fiduciary money always threatens to become fraudulent money. Not surprisingly, therefore, the history of fiduciary money has been more or less the history of monetary fraud, both economic and political.

Third, the danger of fraud in the issuance of fiduciary money becomes particularly acute in the case of modern "fractional-reserve banking". Under fractional-reserve banking, the bank always issues more units of fiduciary money, supposedly "payable on demand", than it has units of commodity money available for redemption, counting on the unlikelihood that the majority of its customers will ever seek redemption at one time. Thus, modern fractional reserve banking is inherently fraudulent, because:

For the bank simultaneously to fulfill all its promises to redeem its outstanding notes "on demand" is impossible.

The bank's managers knowthat complete redemption "on demand" is impossible, and therefore that the bank's promises to pay are false. And,

The bank's customers, by and large, are ignorant of how the fractional-reserve scheme works, and the dangers it poses to them.

III. Fully to comprehend the significance of the FRS also requires recognition that no such thing as "politically neutral" or "politically independent" money exists. For, ultimately, money is a medium both for storing wealth and for exchanging wealth. Thus, money is both itself a form of property and a mechanism for implementing contracts that transfer other kinds of property from one party to another. So, even in a free-market economy with a limited government, money exhibits a necessarily political character, inasmuch as the degree to which the government protects the monetary system from private fraud and public looting reflects the degree to which the government respects and protects private property and the right of private contract. A free-market economy will have one kind of money; a "mixed" or "fascist" economy, another kind of money; a "socialist" economy, yet another kind; and so on - but in each case, the monetary system will accurately reflect the values of the political system.

Thus, once again, the contemporary debate over whether and to what degree the FRS should be "politically independent" of Congress and the United States Treasury is badly misdirected. Originally, the Constitution made Americans' money independent of electoral politics, by fixing the monetary unit as the (silver) "dollar", outlawing "Bills of Credit", and allowing only silver and gold coin to operate as "legal tender" in the payment of debts. But the Constitution is itself the basic political charter of the country - so, far from making money "politically independent" or "politically neutral", the Constitution actually settled on one, very specific political formula for money: namely, a commodity money of historically proven intrinsic value, the supply of which the political authorities could not manipulate at will.

Creation of the FRS in 1913 did not render FRNs "politically independent" or "politically neutral", but merely changed the political character of the monetary system by empowering a small, unelected clique of self-professed "experts" and self-interested bankers and politicians to control the supply of FRNS, interest rates, and other monetary and banking phenomena. Thus, as contrasted with the constitutional system, the FRS actually politicized money, by enabling politicians, administrators, and a few selected special- interest groups to exercise the very influence over this country's monetary and banking systems that the Constitution had originally disallowed.

Americans tend to accept the description of the FRS as 64 politically independent" because, although control of the monetary and banking systems has serious political significance, the apologists for the FRS have been successful, over the years, in removing monetary and banking issues from the agenda of political parties and candidates and stifling public discussion of those issues. Yet, it is of great political significance that:

No major political movement now advocates the immediate restoration of America's original constitutional monetary system of silver and gold coinage.

No major political movement demands that all the paper currencies of private banks be true fiduciary monies - that is, be redeemable in silver or gold, or some other commodity with intrinsic value.

No major political movement attacks - or even questions - inherently fraudulent fractional-reserve banking.

No major political movement denounces the incestuous and corrupt relationship between the national government and the banking industry through the FRS, the Federal Deposit Insurance Corporation, and so on.

No major political movement challenges the government's use of the monetary and banking systems to regulate" the economy and to impose pervasive police-state surveillance on individuals.

The short-term economic effects of the FRS's policies - especially in terms of redistribution of wealth through "inflation" - are more or less of a mystery to the average American; and even the long-term effects are difficult for most economists and political scientists to predict.

Most members of Congress seem unable to understand, and certainly impotent to investigate and expose, let alone to correct, the misguided and harmful policies of the FRS. And,

The general public - to which public officials and all branches and agencies of the government are supposedly responsible - is unable to impose accountability on the FRS as the "agency of government" it pretends to be.

Obviously, a group that could completely excise these matters from political discourse in the United States, without effective (or, indeed, much of any) complaint by a significant part of the public, must be powerful indeed. Now, how the apologists for the FRS have been successful since 1913 in stifling political debate on money and banking the history books do not satisfactorily explain. What is clear enough, nonetheless, is that the FRS was established toremove the Constitution as the arbiter of national monetary policy on behalf of all Americans, and to guarantee instead that certain special- interest groups are disproportionately (indeed, monopolistically) influential in the determination of that policy, for the peculiar benefit of those groups and at everyone else'sexpense. Here, more than one level of analysis is pertinent.

A. At the first level, the FRS appears as primarily a mechanism to "stabilize" the inherently fraudulent fractional-reserve banking system. The purpose of the FRS is to impose structure, cooperation, and even discipline on the banking community, so as to serve the collective interest of those who benefit from the emission of irredeemable paper currency. Consider the devolution of the monetary system from a regime of commodity money to one of fiat money:

Under a regime of commodity money, the bankers employ the inherently fraudulent fractional-reserve system to expand the supply of fiduciary money (that is, bank-notes and deposit-currency) beyond the supply of commodity money (that is, gold and silver coin) available for redemption. This has two effects.

The bankers can loan more "money" than otherwise, thereby increasing their profits. And,

The holders of the fiduciary money become unknowing (and presumably unwilling) "partners" with the bankers in these excessive loans, thereby spreading the risk of those loans throughout society and indirectly "insuring" the bankers at the expense of the general public.

Because the expansion of the supply of this inherently fraudulent fiduciary money is limited by the possibility of widespread demands for redemption (so-called "bank runs"), followed by bankruptcy of the issuing banks, the bankers as a class support a series of steps designed to insulate the fractional-reserve scheme from collapse.

First, they use every available means of propaganda, agitation, and disinformation to instill unjustified confidence in the holders of fiduciary money, so as to minimize redemption and thereby facilitate ever-greater expansion of the supply of that money. Underfunded "deposit-insurance" schemes (either private or public) typify this deceptive tactic.

Second, if "bank runs" do occur, the bankers importune the government to authorize "suspensions of specie payments": temporary refusals on the part of the issuers of the fiduciary money to redeem their notes with commodity money. This permits the bankers to remain in business even though they are bankrupt. "Suspensions of specie payments" are a key indicator of the breakdown of the free-market economy, because they are a governmentally protected repudiation of contracts - in effect, governmentally licensed theft.

Third, to prevent "bank runs" altogether, the bankers lobby for governmental permission to repudiate their fiduciary money totally and permanently - that is, to transform their fiduciary money into fiat money. This generally requires that the government activate some mechanism for the "forced circulation" of the fiat money, such as

by making that money the unit for payment of taxes and for public expenditures;

by declaring that money "legal tender" for all debts; or

by outlawing contracts payable in any other form of money, especially commodity money.

These steps substitute the government - actually, the taxpayers - for the banks and their shareholders as the ultimate guarantors of the fiat money, in return for which the banks agree to two requirements:

They "monetize" the public debt, in effect enabling the government to use the fiat-money system as an instrument of taxation. And,

They cooperate in a cartel or other self-regulatory scheme to control their expansion of the supply of fiat currency within limits that maintain public confidence in the banking system and the government.

In short, the government and the banks agree to divide the amount that can be looted from the general public by manipulation of the money supply, and to moderate that looting so that the public never catches on or complains.

The FRS is simply an elaborate device set up to accomplish these rather simple ends in a highly convoluted, and thereby deceptive, way. The FRS was the response of bankers and their political cronies to decades of failures in the fractional-reserve banking system at the local and regional levels throughout the United States. The FRS was an attempt to maintain that system in perpetuity - first, at the national level with the Federal Reserve Act in 1913, and then at the international level with the Bretton Woods Agreement in 1944. "Was" is the appropriate verb, because the Bretton Woods Agreement collapsed in 1971, with President Nixon's repudiation of redemption of FRNs in gold internationally; and mounting strains in the system have been appearing domestically since the 1970s.

The key dates in the devolution of the FRS are as follows:

1913 - Congress creates the FRS; permits the emission of FRNS, redeemable in "lawful money"; and declares FRNs to be "obligations of the United States", but not "legal tender". In practice, the Federal Reserve Banks and the United States Treasury redeem FRNs for gold coin on demand. FRNs are a fiduciary currency.

1933 - Congress repudiates redemption of FRNs in gold for United States citizens, and declares that FRNs shall be "legal tender". The government continues to redeem FRNs in gold for foreigners; and United States citizens can redeem FRNs for "lawful money" (such as United States Treasury Notes and silver certificates), which is redeemable in silver coins. Therefore, FRNs remain a fiduciary currency, redeemable directly in gold internationally and indirectly in silver domestically.

1968 - Congress repudiates redemption of all forms of "lawful money" in silver, thus turning FRNs into a fiat currency domestically for tire first time.

1971 - President Nixon repudiates redemption of FRNs in gold, thus turning FRNs into a fiat currency internationally for the first time.

So, today, Americans suffer under a regime of fiat money and unlimited fractional-reserve banking. In this system, the FRS plays a very simple, but vital role: When public confidence in the monetary and banking systems weakens, the FRS acts to "restore confidence". The FRS may use what the public considers "drastic means" in this alleged "fight" (consider the high interest-rates of the Carter years), but never means so drastic that they endanger the long-term interests of the banking cartel, its satellite industries, and its political cronies.

The unavoidable problem, of course, is that any system of fractional- reserve banking suffers from inherent instability that increases over time, because at base fractional reserve banking is a kind of "Ponzi" or "pyramid" scheme. For that reason, fractional-reserve banking is a "confidence game" in both senses of that term. The FRS, the banking cartel, and the politicians of the American one-party system operate on the theory that "You can fool all of the people some of the time, and some of the people all of the time and that's good enough!" But they forget that, as Lincoln concluded, "You can't fool all of the people all of the time." Over time, some people - often large numbers of them - do learn. And people who have learned tend to act on their knowledge. So the remaining lifetime of the FRS "confidence game" may, and likely will, be relatively short.

B. On a higher level of analysis, the FRS is not simply a control- mechanism for the national banking cartel, but also one of the most important mechanisms in a pervasive system of fascistic "economic regulation" that has been set up in this country, slowly but surely, since the turn of the century. This explains the "political independence" of the FRS in a way more logical than the idea that money and banking are no longer politically important, divisive, or even interesting subjects. If a fascistic state is to "regulate" the economy with relative autonomy from the electoral public and most special-interest groups, then its monetary agency must claim "political independence". (Actually, in a fascistic state, all of the regulatory agencies must claim "political independence" to some degree - which claim, not surprisingly, is advanced by essentially every administrative agency of the national government today. But the degree of "political independence" will vary with the importance of the agency to the overall scheme of centralized regulation of society.) Thus, the "political independence" the FRS claims is precisely expectable were it part of an anti-democratic mechanism of economic and political control. And that no constitutional branch of the national government - not the Congress, not the President, and not the Judiciary - disputes the FRSs supposed "independence"proves that those branches, too, have been co-opted as agencies of the fascistic state.

In sum, contemporary political money and the politicized banking system that generates it have five major consequences:

1.First, modern political money is the prime means by which the government operates a scheme of OPPRESSIVE,HIDDEN TAXATION through increases in the supply of money that generate systematic increases in the prices of goods and services (what the public calls "inflation").

2. Second, by operating as a system of hidden taxation, modern political money licenses the dominant financial and political oligarchy of this country to "REDISTRIBUTE" THE NATION'S WEALTH from one group to another - more than $6 trillion since World War 11, according to the American Institute for Economic Research.

3. Third, by functioning as a mechanism for "redistributing" wealth, modern political money SYSTEMATICALLY CORRUPTS THE ELECTORAL PROCESS, enabling politicians to buy votes with promises of new or expanded governmental spending-programs made possible only by the banking system's ability to "monetize" the public debt.

4. Fourth, by linking the banking system to the public debt, modern political money licenses the banks to LOOT THE PUBLIC TREASURY, initially by guaranteeing FRNs as "obligations of the United States" and specially privileging those notes as "legal tender", and ultimately by providing taxpayer-funded "bail outs" of the bankers when the scheme of inherently fraudulent fractional-reserve banking collapses.

5. Fifth and last, modern political money and political banking function as key mechanisms in the scheme of FASCISTIC CENTRAL ECONOMIC PLANNING that misdirects and wastes resources and thereby lowers the standard of living of the vast mass of Americans for the benefit of a privileged few.

IV. Although long a powerful - and today still a politically untouchable - institution, the FRS faces a dismal future. This can be assessed by considering the contemporary political-economic conditions that have given rise to the problem of collapsing domestic banks.

A. The first of these conditions is the essentially fictional and fraudulent nature of modern paper money and fractional-reserve banking.

The fictional and fraudulent character of contemporary paper money is a demerit additional to the inescapable economic disparity between all paper money and real money (that is, silver and gold coins). Paper money can never be economically equivalent to real money because:

A transfer of real money between two persons immediately transfers a real asset: the silver or gold that comprises the coins.

Unlike real money (which is itself the monetary substance), paper money is merely a promise to pay real money at some future date, subject to various contingencies, and always uncertain.

For that reason, a transfer of paper money between two persons does not and cannot transfer the underlying monetary asset immediately, only the promise to pay - that is, the liability of the maker of the promise. And,

In as much as the promise may be more or less secure due to the credit-worthiness or -unworthiness of its maker, a transfer of paper money transfers not only a claim to the underlying real monetary asset but also a risk of loss should the promise of payment (redemption) not be honored, in whole or in part.

In short, even when paper money is actually a promise to pay - and potentially fully redeemable in silver or gold it remains an asset to its holder only to the extent that the issuer of the promise ultimately makes good on his liability to redeem, or that other people are themselves sufficiently confident of the promisor's solvency to accept the paper money at its face value in exchange for nonmonetary goods and services. In the final analysis, paper money is an asset only if it can be cashed or passed without loss in purchasing power as against real money - which the holder of paper money can determine only when he actually cashes or passes it.

In the United States, for example, today's fiat paper currency is neither itself a valuable commodity nor even a credible promise to pay a valuable commodity in redemption. No holder of FRNs has any legal right to require that the Federal Reserve Banks or the United States Treasury redeem them for any amount of any commodity. And no holder of these notes has any legal right to compel any other ordinary person to exchange a fixed amount of any good or service for some known nominal value of this currency proportional to some weight of silver or gold. Indeed, notwithstanding the statutory mumbo-jumbo mandating their redemption "in lawful money", guaranteeing them as "obligations of the United States", and declaring them "legal tender" for all debts, 2 the most a holder of FRNs can demand as a matter of law is that the national government receive them in discharge of tax- liabilities. Thus FRNs are largely fictional money: for they are, in fact and law, a medium of exchange certain exchanges of which are absolutely refused by their issuers and conditionally refused by everyone else in the marketplace, and which the government accepts only to set off antecedent tax-claims the size of which it unilaterally determines in the first instance. FRNs are, really, just tax-anticipation coupons masquerading as money.

Similarly, contemporary "reserve" banking is, not merely "fractional", but rather inherently fictional. For no bank in the FRS maintains any real "reserves" of money, only paper notes or bookkeeping-entries that the system can "create out of nothing", at any moment and in any amount - but the purchasing power of which in real money (silver or gold) or in any valuable commodity the system cannot guarantee at any time or to any degree.

Moreover, the essentially fictional character of contemporary,fiat paper currency and "reserve" banking is the source of their inherent fraudulence - because the fiction is unknown to (indeed, carefully hidden from) the general public. The special privilege of the FRS to emit unlimited amounts of irredeemable, "legal-tender" paper currency, and to loan that currency at interest through the system's commercial member-banks, amounts to a veritable license to steal - because the general public is unaware of the economic significance of the currency's irredeemability, and ignorantly assumes that its designation as "legal tender" compels its use as a medium of exchange to the exclusion of all other forms of money.

The abjectly fictional nature of modern paper currency and fractional- reserve banking encourages the question: why do fiat FRNs continue to circulate, and banks without any real monetary reserves continue to function? Those who accept the theory that "money" is whatever the government decrees would answer that FRNs (or bank-deposits denominated in FRNS) have value as media of exchange in the marketplace because people must acquire them in order to pay their taxes. The obvious fallacy here, though, is that the government accepts payment of taxes in FRNs precisely because those notes have a finite purchasing-power in the market, and therefore are usable as "money" by the government. It is not the present and future taxability of the notes that gives them their market exchange-value, but their residual market exchange-value that renders them viable as a medium of taxation. One must recall that FRNs were originally redeemable, directly or indirectly, in gold coins, silver coins, or both. For that reason, FRNs had a real exchange-value in the market that reflected their underlying redemption-values in gold or silver, and depended not at all on their use as a medium of taxation but indeed made them valuable for that purpose. When FRNs became wholly irredeemable after 1968/1971, they lost any fixed or predictable market exchange-value in terms of real money, and therefore became of increasingly uncertain value as a medium of taxation, too (at least to the extent they continue to depreciate in market exchange-value, as they have, steadily, since then).

A more realistic explanation for the continued circulation of FRNs (or bank-deposits denominated in FRNS) as "money" is that the general public is the victim of a confidence-game, in which the government and the banks have foisted off paper liabilities in the place of real monetary assets in an inverted pyramid of monetary fraud. Atthe tip of this upside-down pyramid are real "dollars": silver and gold coins that are themselves monetary assets and no one's liabilities, and circulate among those knowledgeable about the differences between real money and paper money. Next in amount in circulation - and at the first level of the institutionalized fraud - are the base- metallic token (or "clad") coins of cupro-nickel alloy. These are monetary assets to the extent of their salvageable metallic content - which is worth about 2% or less of their face values - , but otherwise are liabilities of the government which at one time were redeemable in silver, but are today wholly irredeemable. The next largest fraudulent circulating medium consists of actual FRNS, today "redeemable" only in "clad" coins. Finally, the greatest portion of the so-called "money supply" consists of bank demand-deposits, most of which have been loaned at interest to persons other than the depositors. Revealingly, not only are these purported deposits not actually on deposit in the banks at all, but also the deposits are not even formally "redeemable", because the deposits themselves are not the depositors' "money", but the banks'! The deposits are loans of money the depositors (many of them unknowingly) have made to the banks, and which the banks have then further loaned to third parties.

But how many people are aware of this situation? Why do the government and the banks not educate those who are unaware of what is really going on - other than because the government and the banks knowingly profit from public ignorance and therefore intentionally promote it? And how long can such a swindle continue?

B. This question highlights the second of the contemporary political- economic conditions that underlie the problem of collapsing domestic banks: namely, the inability of the banks to continue indefinitely to increase the supply of money within the domestic economy - as the saying goes, to "expand credit" (because the supply of new money derives from the extension of bank-credit to borrowers). The answer to the question "How long can this confidence game last?" is "Not forever!". If, on the one hand, the banks overly expand credit, hyperinflation occurs (that is, the purchasing-power of the monetary unit falls exponentially). If, on the other hand, the banks overly restrict the expansion of credit in order to avoid hyperinflation, recession and then depression occur (that is, people borrow less, and then existing borrowers in massive numbers default on loans). The bankers' "trick" - and dilemma - is to continue to expand credit within an expanding, and therefore essentially noninflationary, economy. The insoluble problem inherent in credit-expansion through fractional-reserve banking, however, is that expansion of a fiat money supply inevitably misdirects and wastes real economic resources, resulting in an increasingly nonrational economy - an economy that does not expand in real terms. In short, credit- expansion by fractional-reserve banking in the long run guaranteeseconomic collapse, with resultant social chaos and political crisis.

CONCLUSION

No crystal ball is necessary to predict that a turning point in the history of money and banking in the United States is drawing nigh. The burden of governmental debt - much of it made possible only by central-bank "monetization" - has approached levels unsustainable in real terms even with drastically increased confiscation of Americans' earnings through explicit taxation. But Americans seem reluctant to accept more taxation to fund the never-ending follies of a spendthrift welfare state. Thus, repudiation of the debt (in whole or in part) through extreme depreciation of FRNs and bank-deposits denominated therein appears likely, if not certain.

For this looming debacle, Americans can thank the FRS, the "experts" who administered it since 1913, the politicians who used it as a "cover" to finance their own careers, the bankers who profited from their monopoly over the emission of "legal-tender" paper currency, and the "intellectuals" in academia, the press, and the media who (quite unlike their counterparts in the last century) remained strangely silent on the issue of money and banking. That is, Americans can properly thank these people if Americans become aware of what the FRS is, what it does, and why it is responsible for having undermined to the point of collapse the nation's once proudly prosperous economy and staunchly republican political process.

Those who love their country may hope that that day of a new national awareness will soon be at hand.

---------------------------------------------------------------------- ----------

NOTES

1 Edwin Vieira, Jr., Pieces of Eight.- The Monetary Powers and Disabilities of the United States Constitution, A Study in Constitutional Law (1983).

2 See 12 U.S.C. 411; 31 U.S.C. 5103.

-- Nikoli Krushev (doomsday@y2000.com), February 12, 1999.

No Spam,

The bankers that decided to create the Federal Reserve ran it through Congress on December 23, 1913 right before Christmas when most of the congressman were not even in attendance to cast their vote. It was passed, even though only 2 STATES voted for it! It requires a majority vote in order to ammend the constitution, and thus the Federal Reserve System was ILLEGALLY created. The collecting of taxes ever since has been totally illegal, and the citizens of the United States are rightfully entitled to a refund of every penny they have ever paid.

-- (@@@.@), February 12, 1999.

NK,

Thanks for posting that beautiful essay.

-- Nathan (nospam@all.com), February 12, 1999.

Nathan, That essay was lifted from WE THE PEOPLE website. They are an excellent rescource and eternally vigilant.http://www.adriaticins.com/cgi-bin/wtp.cgi/50

For some astounding reference material reguarding the founding fathers and their thoughts and intentions check out: http://www.up.net/~willie/ He (Willie) has recovered an antique set of books from the library of congress and is in the process of posting this unabridged and unedited text so that it will be available to all. No spin involved, this is the straight scoop.

-- Nikoli Krushev (doomsday@y2000.com), February 12, 1999.

Read here as a prescient Andrew Jackson warned of what was to come.

From Willie's Place.

Andrew Jackson

---------------------------------------------------------------------- ----------

Veto of Proposed Bank Policies July 10th, 1832

Gentlemen of the Senate and House of Representatives:

The present corporate body, denominated the president, directors, and company of the Bank of the United States, will have existed at the time this act is intended to take effect twenty years. It enjoys an exclusive privilege of banking under the authority of the General Government, a monopoly of its favor and support, and, as a necessary consequence, almost a monopoly of the foreign and domestic exchange. The powers, privileges, and favors bestowed upon it in the original charter, by increasing the value of the stock far above its par value, operated as a gratuity of many millions to the stockholders....

The act before me proposes another gratuity to the holders of the same stock, and in many cases to the same men, of at least seven millions more....It is not our own citizens only who are to receive the bounty of our Government. More than eight millions of the stock of this bank are held by foreigners. By this act the American Republic proposes virtually to make them a present of some millions of dollars.

Every monopoly and all exclusive privileges are granted at the expense of the public, which ought to receive a fair equivalent. The many millions which this act proposes to bestow on the stockholders of the existing bank must come directly or indirectly out of the earnings of the American people.

It appears that more than a fourth part of the stock is held by foreigners and the residue is held by a few hundred of our own citizens, chiefly of the richest class.

Is there no danger to our liberty and independence in a bank that in its nature has so little to bind it to our country? The president of the bank has told us that most of the State banks exist by its forbearance. Should its influence become concentered, as it may under the operation of such an act as this, in the hands of a self-elected directory whose interests are identified with those of the foreign stockholders, will there not be cause to tremble for the purity of our elections in peace and for the independence of our country in war? Their power would be great whenever they might choose to exert it; but if this monopoly were regularly renewed every fifteen or twenty years on terms proposed by themselves, they might seldom in peace put forth their strength to influence elections or control the affairs of the nation. But if any private citizen or public functionary should interpose to curtail its powers or prevent a renewal of its privileges, it can not be doubted that he would be made to feel its influence.

It is to be regretted that the rich and powerful too often bend the acts of government to their selfish purposes. Distinctions in society will always exist under every just government. Equality of talents, of education, or of wealth can not be produced by human institutions. In the full enjoyment of the gifts of Heaven and the fruits of superior industry, economy, and virtue, every man is equally entitled to protection by law; but when the laws undertake to add to these natural and just advantages artificial distinctions, to grant titles, gratuities, and exclusive privileges, to make the rich richer and the potent more powerful, the humble members of society the farmers, mechanics, and laborers who have neither the time nor the means of securing like favors to themselves, have a right to complain of the injustice of their Government. There are no necessary evils in government. Its evils exist only in its abuses. If it would confine itself to equal protection, and, as Heaven does its rains, shower its favors alike on the high and the low, the rich and the poor, it would be an unqualified blessing. In the act before me there seems to be a wide and unnecessary departure from these just principles.

Nor is our Government to be maintained or our Union preserved by invasions of the rights and powers of the several States. In thus attempting to make our General Government strong we make it weak. Its true strength consists in leaving individuals and States as much as possible to themselves in making itself felt, not in its power, but in its beneficence; not in its control, but in its protection; not in binding the States more closely to the center, but leaving each to move unobstructed in its proper orbit.

Experience should teach us wisdom. Most of the difficulties our Government now encounters and most of the dangers which impend over our Union have sprung from an abandonment of the legitimate objects of Government by our national legislation, and the adoption of such principles as are embodied in this act. Many of our rich men have not been content with equal protection and equal benefits, but have besought us to make them richer by act of Congress. By attempting to gratify their desires we have in the results of our legislation arrayed section against section, interest against interest, and man against man, in a fearful commotion which threatens to shake the foundations of our Union. It is time to pause in our career to review our principles, and if possible revive that devoted patriotism and spirit of compromise which distinguished the sages of the Revolution and the fathers of our Union. If we can not at once, in justice to interests vested under improvident legislation, make our Government what it ought to be, we can at least take a stand against all new grants of monopolies and exclusive privileges, against any prostitution of our Government to the advancement of the few at the expense of the many, and in favor of compromise and gradual reform in our code of laws and system of political economy....

Table of Contents Main Table of Contents Return to The Bloody Yank

-- Nikoli Krushev (doomsday@y2000.com), February 12, 1999.

Nikoli,

>I would be interested in seeing the article from which you gleaned your information, it smacks of government spin and disinformation to me.

Since it seems that you won't believe anything I reference if it disagrees with your view, I won't waste time typing the links to Treasury and FRB information (easily found via Internet search). Lets try the reality test. As I pointed out in my postings above, you can simply walk in to any FRB and see for yourself who's telling the truth. You don't have to actually carry in $10,000 with you - intelligent observation, reading, and questioning will suffice. >The article I posted is only one of about a thousand just like it scattered across the web. >I see nothing different in it than any other story I have EVER read on the Fed. Quoting 1,000 anti-Fed articles does not make them accurate if they aren't. Do the reality test. I've been in one of the FRB branches. Everything I experienced matched what I'm claiming. Not everything the government publishes is a lie.

-- No Spam Please (anon@ymous.com), February 13, 1999.

My apologies for omitting some formatting. Should have been:

Nikoli,

>I would be interested in seeing the article from which you gleaned your information, it smacks of government spin and disinformation to me.

Since it seems that you won't believe anything I reference if it disagrees with your view, I won't waste time typing the links to Treasury and FRB information (easily found via Internet search).

Lets try the reality test.

As I pointed out in my postings above, you can simply walk in to any FRB and see for yourself who's telling the truth. You don't have to actually carry in $10,000 with you - intelligent observation, reading, and questioning will suffice.

>The article I posted is only one of about a thousand just like it scattered across the web.
>I see nothing different in it than any other story I have EVER read on the Fed.

Quoting 1,000 anti-Fed articles does not make them accurate if they aren't. Do the reality test.

I've been in one of the FRB branches. Everything I experienced matched what I'm claiming. Not everything the government publishes is a lie.

-- No Spam Please (anon@ymous.com), February 13, 1999.

No Spam, and any interested bystanders, reach in your hip pocket and whip out one of those greenbacks. Now turn that puppy face up and read what is written across the top of it. FEDERL RESERVE NOTE. Not U.S. treasury note.

-- Nikoli Krushev (doomsday@y2000.com), February 13, 1999.

Right on, Nikoli! And also notice on the back side a pyramid with the "all-seeing" eye, the symbol of the Brotherhood of Free Masons, controlled by the Illuminati of the global elite. Draw a star of David within the circle surrounding the pyramid and you will see that the points of the star spell out the word "MASON".

-- (@@@.@), February 13, 1999.

Nikoli,

>reach in your hip pocket and whip out one of those greenbacks. Now turn that puppy face up and read what is written across the top of it. FEDERL RESERVE NOTE. Not U.S. treasury note.

I already covered this in a previous posting. But here's more detail:

Open your checkbook and look at the face of one of your checks. It has the name of the bank at which you have your account. It has the routing number of the bank at which you have your account. Your bank is the only entity which can (at your order) debit money from your account to pay the depositor of the check.

The money someone gets when they cash one of your checks comes from _your_ account, not the bank. But the bank's name is on it anyway because that is where your account is.

Federal Reserve Notes come from the U.S. Treasury's account at the Federal Reserve, not from the Federal Reserve's own funds.

Care to take the reality test, Nikoli?

-- No Spam Please (anon@ymous.com), February 13, 1999.

@@@.@,

>It was passed, even though only 2 STATES voted for it!

Oh, come on! Give us a more believable story.

(For one thing, states don't vote in Congress.)

>It requires a majority vote in order to ammend the constitution, and thus the Federal Reserve System was ILLEGALLY created.

The FRS was not created by constitutional amendment.

But I suppose what you're trying to convey is that you think it should have required a constitutional amendment to create the FRS. Is that it? Or what?

>The collecting of taxes ever since has been totally illegal,

The Federal Reserve System does not collect taxes, so what's your point?

>and the citizens of the United States are rightfully entitled to a refund of every penny they have ever paid.

Why should anyone consider this to be other than sloppy thinking?

-- No Spam Please (anon@ymous.com), February 13, 1999.

Well If I had a checkbook I would do what you suggest, but I closed out my bank accounts months ago. It is becoming increasingly apparent that you are probably a gov. troll, or just a natural born idiot masquerading as one. You seem to assume that your IQ is superior to anyone who disagrees with you and take joy or pleasure in baiting people which is a dead giveaway to your true nihlistic,sadistic, nazi, agnostic, atheist, spiritually barren personality. Just keep mouthing that party line, espousing that gov.org propoganda, and hope in your darkest soul you have choosen the right side. We're all gonna find out pretty shortly.

-- Nikoli Krushev (doomsday@y2000.com), February 13, 1999.

@@@.@,

By the way, why don't you simply advocate paying taxes with FRNs? According to you, they're nonexistent money -- so using them to pay taxes wouldn't really cost you anything, would it?

- - - - - - - - - -

Nikoli,

A) If any of your acquaintances has a checking account, ask to see one of their checks.

B) Have you already discarded all your cancelled checks from the past? Haven't you kept even a single one of your cancelled checks for recordkeeping/accounting/legal purposes? Look at it.

C) Go to any bank. Ask to see a blank check, the sort they'd give you if you opened an account there.

Of course, A), B), and C) fall in the category of reality test.

-- No Spam Please (anon@ymous.com), February 13, 1999.

Nikoli,

I was trying to hold this back, but what with tomorrow being Valentine's Day and all ...

>It is becoming increasingly apparent that you are probably a gov. troll, or just a natural born idiot masquerading as one. You seem to assume that your IQ is superior to anyone who disagrees with you and take joy or pleasure in baiting people which is a dead giveaway to your true nihlistic,sadistic, nazi, agnostic, atheist, spiritually barren personality. Just keep mouthing that party line, espousing that gov.org propoganda, and hope in your darkest soul you have choosen the right side. We're all gonna find out pretty shortly.

Niki (if I may be so bold), you say such _nice things_ to those who repeatedly refute your arguments. (sob) I'm touched. (sniff, cry, sob) Really, deeply honored. (sniff) Excuse me ... I can't continue right now ...

-- No Spam Please (anon@ymous.com), February 13, 1999.

Got FRN's? ha ha hahehheheh ahhahahehehehheeeeeoh hell, I'm sorry, did I hurt your feelings Spamless? DIDN'T SHAKE YOUR FAITH IN THE GOVERNMENT WHORE DID I? I'm sure when those FRN's are nothing more than asswipe the gov. will make an exception for such a genius as you who hath defended the moral virtue of the FEDERAL RESERVE (All Bow) snickers in the background HAIL ROTHSCHILD, HAIL ROTHSCHILD, HAIL ROTHSCHILD.

If you just want to argue pick a better subject.

-- Nikoli Krushev (doomsday@y2000.com), February 13, 1999.

No Spam,

The Treasury Department is just the part of the Federal Reserve System that collects taxes, all part of the same scam. The sixteenth ammendment to the Constitution, granting the authority to collect taxes was passed by two states, when it required at least thirty-six to be legal.

Since you have convinced me how great this system is, my friends and I just voted to start another one. I hereby declare that my paper Monopoly money is backed by my gold reserves (small, but sufficient), and that this new currency can now be used to purchase property of real value, and to pay my taxes. We will use it to employ others to build luxurious mansions for ourselves, and then tax those employees for the currency we have paid them. We are now hiring, so since I am such a nice guy, would you like a job?

-- (@@@.@), February 13, 1999.

Nikoli,

Let me know when you've got the guts to take one of the reality tests outlined above.

Are you afraid to read the face of a cancelled check?

(P.S. You interpreted what I wrote to mean that my feelings were hurt? Better read it again 'til you get it right.)

-- No Spam Please (anon@ymous.com), February 14, 1999.

No Spam,

Bottom line - the FED, created illegally (check your history) is perpatrating the oldest con game in the world on the American people. That's what this thread is all about. IT IS A RIP-OFF, no question about it.

Your reality test means not a whit - that is not what is at issue here and is a straw man.

On another thread I said to go away and read David Ickes "And the truth shall set you free" - until you do that and have the same information many others on this thread have you cannot debate the issue. I'm sorry - I don't want to be rude but we are just going around in circles.

the book is fully annotated - you would be impressed.

Joe Bob says check it out.

-- Andy (2000EOD@prodigy.net), February 14, 1999.

Andy,

If that's the same David Ickes who has glaring factual sloppiness in his article about various EOs that he displays on his Web site, then I'll not spend money for his book.

-- No Spam Please (anon@ymous.com), February 14, 1999.

NSP,

I do not (yet) agree with Nikolai's, (et al) position, but your argumentation technique is pushing me that way. I see it as misdirected. Although you have chipped away at minor aspects of NK's interpretation, disputed his semantics, and generally nitpicked him to the point of frustration, you have made no effort to refute his quoted references. They stand on their own. Isn't it somewhat disingenuous of you to complain that NK does not believe any of your references? In addition, I have not seen any foundational reasoning for your defensive position of the FRS. Do you feel that it is a just, fair system? Do you feel that no better system is possible? Is the system sound? How does a personal visit to a FRB branch make you an expert on the system? Come on, boy, put some substance behind your own position, instead of belittling the opposition with trivialities. Otherwise, those of us observing this debate might be left with the impression that this is just an ego exercise on your part.

-- Elbow Grease (Elbow_Grease@AutoShop.com), February 14, 1999.

Reading "its" posts on this and other threads, one can only conclude that "No Spam" is either seriously DWGI re money/credit/taxes, or is a government troll. As far as I'm concerned, from now on I'm just gonna scroll by any of "its" posts. Nothing worthwhile so far. To get us to pay attention again to "its" blather, "it" will probably soon start posting with a new handle.

-- A (A@AisA.com), February 14, 1999.

Elbow Grease,

I stated the meat of my argument about the FRS early on:

NSP, Feb. 12>FRNs are a medium of exchange. Gold is a medium of exchange. FRNs and gold have different physical properties, leading to different uses (e.g., wallpaper, jewelry) aside from their uses as media of exchange, and also leading to differing acceptability as media of exchange in various circumstances.

I'd love to actually discuss the FRS, but that can't be done while we have a view of it that is cluttered by numerous misstatements of fact.

>Although you have chipped away at minor aspects of NK's interpretation,

Minor? The "simple explanation of how the fed steals our money' that Nikoli posted on the 12th is riddled with basic factual errors. The overall effect is to render it such a distortion as to completely mislead the uncritical reader.

>disputed his semantics,

Where? When he says the bank uses $500 billion cash, the meaning of the sentence is just plain wrong, so I said so.

>and generally nitpicked him to the point of frustration, you have made no effort to refute his quoted references.

What are you talking about?

On February 12, Nikoli posted a quotation from an article about the Fed. I posted a refutation of multiple errors in that quoted reference. The cumulative effect of those errors was substantial, enough to completely turn around the description of Fed operation to something very different from what actually happens.

I'm not trying or obligated to refute every quoted reference by Nikoli. I disagree with a few of them, and that's what I've posted about.

>They stand on their own.

I have no quarrel with the majority of Nikoli's quoted references, so it's fine with me if they stand alone.

>Isn't it somewhat disingenuous of you to complain that NK does not believe any of your references?

No. Since Nikoli wrote _in advance of seeing even one word_ of my references that my information "smacks of government spin and disinformation", it is an easy extrapolation to project that when I refer him to the Federal Reserve and Treasury web sites, he will not believe them either. Those websites are easily found via Internet search, as I specifically pointed out. If Nikoli or anyone else is motivated to see them, he can readily do so.

>In addition, I have not seen any foundational reasoning for your defensive position of the FRS.

What I have posted are corrections of factual errors, not a defense of the FRS. I never claimed the FRS was a wonderful thing -- I've just stated facts about it that contradict the errors introduced into this thread.

If I'm going to read through arguments against the FRS, I want them not to be cluttered and obscured beyond recognition by factual sloppiness.

After we clear away the clutter of misstatements, then we can discuss the FRS.

>Do you feel that it is a just, fair system? Do you feel that no better system is possible? Is the system sound?

What I feel is that we can't get to those topics until we've cleared away the jungle of errors and misinformation so we all see the FRS for what it is instead of the distortion some paint of it.

>How does a personal visit to a FRB branch make you an expert on the system?

I was giving a concrete example of a specific method by which one could check out the accuracy of what I am stating.

I never stated that I am an expert on the system or that my visit made me one.

I gave a concrete method of verification to counter some Nikoli's mistaken statements. E.g., if you walk into an FRB (or call, or write, or ...) you'll find that the "10%" quoted by Nikoli is fictitious. Ask to buy a bond -- pretend you actually have the $10,000 until you've been shown whether or not there is any fee. Then you will have direct confirmation that the 10% fee claim is false.

>Come on, boy, put some substance behind your own position,

That's exactly what I've done, as explained.

>Otherwise, those of us observing this debate might be left with the impression that this is just an ego exercise on your part.

As long as you apply the same standards to both sides of the debate, that's fine with me.

-- No Spam Please (anon@ymous.com), February 14, 1999.

NSP,

>On February 12, Nikoli posted a quotation from an article about the Fed. I posted a refutation of multiple errors in that quoted reference. The cumulative effect of those errors was substantial, enough to completely turn around the description of Fed operation to something very different from what actually happens. <<

So let's hear an *accurate* description of Fed operation.

The "reference" to which you responded (Feb 12), was given no attribution by NK, and had (my assumption) the characteristics of an interpretation. On re-reading it, I understand that it might be a quotation, though the errors you exposed support my assumption. At one point you ask:

"Will you please provide more detail on exactly what you mean here?" Are you not at this point making the same assumption? More on your response below.

What I'm trying to tell you is that your *technique* does nothing to help put order into this subject. While your phrase by phrase analysis *seems* to be backed by some depth of knowledge, that knowledge has so far been withheld, except as a tool to parry, dispute, and contradict. One is left with an impression of condescension and distain.

For example, this:

>The Citizens allow the bank to print $500 billion in currency (cash).

could have been answered simply with this:

"Only the Treasury Department prints currency."

And then move on, since currency is a trivial part of the equation, which is *Money,* who creates *Money,* the expansion of *Money,* and the manipulation of *Money.*

Your entire refutation concerning "currency" is in that sense trivial. And I think you knew it then.

>>Come on, boy, put some substance behind your own position,

>That's exactly what I've done, as explained.<<

Excuse me? You have *not.* I asked, and you quoted:

>Do you feel that it is a just, fair system? Do you feel that no better system is possible? Is the system sound?

And your response? A brush-off:

>What I feel is that we can't get to those topics until we've cleared away the jungle of errors and misinformation so we all see the FRS for what it is instead of the distortion some paint of it.<

Where's the substance?

I think you know there are solid, constitutionally based arguments against the authority given to the FRS. For instance, that the FRS *is* a private institution, and therefore the establishment of the FRS *should have* required a constitutional amendment. I think you are aware that the FRS *does* create Money out of thin air, and that entire national economies hang on every hint of that power. Don't you have *any* problem with this system?

-- Elbow Grease (Elbow_Grease@AutoShop.com), February 14, 1999.

Elbow Grease, when clearing away errors and misinformation constitutes a brushoff, I'm out of my depth. My apologies for not having realized this sooner. Have a nice day.

-- No Spam Please (anon@ymous.com), February 15, 1999.

96 PU R PO SE S & FU NC TI ON S 1. The first U.S. paper money under the Constitutiondemand noteswas issued in 1861. All currency issued by the U.S. government since then remains valid. Currency in circulation, other than Federal Reserve notes, includes silver certificates (which have a blue Department of the Treasury seal), United States notes (red seal), and national bank notes (brown seal). Federal Reserve notes (which have a green seal) (THIS GREEEN SEAL INDICATES THAT THE NOTES AS ISSUED ARE NOT FROM THE DEPARTMENT OF THE TREASURY, BUT FROM THE FEDERAL RESERVE, WHICH IS A PRIVATE CORPORATION) (were first issued in 1914.must be secured by legally authorized collateral, most of which is in the form of U.S. Treasury and federal agency securities held by the Reserve Banks. The notes are a first lien on the assets of the issuing Reserve Bank and are obligations of the U.S. government. The notes are designed and printed by the Bureau of Engraving and Printing of the Department of the Treasury and are delivered to the Reserve Banks for circulation. The Federal Reserve System pays the Bureau of Engraving and Printing only for the cost of printing the notes.1 (THE FEDERAL RESERVE SYSTEM PAYS ONLY FOR THE COST OF PRINTING THE NOTES) Coin is different from currency in that it is the direct obligation of the Treasury. The Reserve Banks pay the Department of the Treasurys Bureau of the Mint for the face value of the coin re- ceived rather than for the cost of the minting. ( WHY IS COIN DIFFERENT? IT IS LEGAL TENDER ACTUALLY PRODUCED BY THE GOVERNMENT ) As I STATE EARLIER NO SPAM IS SPREADING MISINFORMATION OR GOVERNMENT PROPOGANDA. This information is a direct excerpt from the Federal Reserves website and clearly shows that their are two types of currency in circulation. Coins, which are Treasury department legal tender, and federal reserve notes which are created out of thin air for only the cost of printing. But now since the Fed must purchase those coins from the Treasury at face value, how do you suppose they pay for them? Pretty simple, they just order a new batch of FRN's with enough overrun to cover printing cost, then after taking delivery of the hard currency they deposit it to their account, throw the cash in their vault, and electronicly transfer a credit to the treasury's account. So they have nos got the coins for nothing, which is exactly the same scam they used to loot our gold reserves until Nixon put a stop to it.

-- Nikoli Krushev (doomsday@y2000.com), February 15, 1999.

I'm still waiting wonder spam.

-- Nikoli Krushev (doomsday@y2000.com), February 15, 1999.

Right on, Nikoli! And also notice on the back side a pyramid with the @@@ said:

"all-seeing" eye, the symbol of the Brotherhood of Free Masons, controlled by the Illuminati of the global elite. Draw a star of David within the circle surrounding the pyramid and you will see that the points of the star spell out the word "MASON".

Note also the date on the pyramid - 1776. Hmmm...US Govt was formed at 1st Constitutional Congress in 1778...Why put the date of the signing of the Dec. of Indep. on the FRN's...unless....double Hmmm!...1776 is the year Adam Weiskaupt formed (or should we say re-formed) the Bavarian Illuminati.

These are strange synchronicities, but then again, synchronocities are strange by definition. Or should I say consensus.

-- (@@@.@), February 13, 1999.

-- a (a@a.a), February 15, 1999.

whoops...I meant

@@@ said:

Right on, Nikoli! And also notice on the back side a pyramid with the "all-seeing" eye, the symbol of the Brotherhood of Free Masons, controlled by the Illuminati of the global elite. Draw a star of David within the circle surrounding the pyramid and you will see that the points of the star spell out the word "MASON".

Note also the date on the pyramid - 1776. Hmmm...US Govt was formed at 1st Constitutional Congress in 1778...Why put the date of the signing of the Dec. of Indep. on the FRN's...unless....double Hmmm!...1776 is the year Adam Weiskaupt formed (or should we say re-formed) the Bavarian Illuminati.

These are strange synchronicities, but then again, synchronocities are strange by definition. Or should I say consensus.

-- a (a@a.a), February 15, 1999.

@@@@@@, I haven't done enough research on the Illuminati and David Ikes theories to hold a rational conversation on the subject. I will say that what I have read is extremely well documented.

-- Nikoli Krushev (doomsday@y2000.com), February 15, 1999.

Gee, does this mean everthing No Spam said was a crock of crap?

-- opened eyes (awaken@dawn.com), February 16, 1999.