December 23rd marks the 100th anniversary of the Federal Reserve. Dissatisfaction with its track record has prompted calls to audit the Fed and end the Fed. At the least, Congress needs to amend the Fed, modifying the Federal Reserve Act to give the central bank the tools necessary to carry out its mandates.
The Federal Reserve is the only central bank with a dual mandate. It is charged not only with maintaining low, stable inflation but with promoting maximum sustainable employment. Yet unemployment remains stubbornly high, despite four years of radical tinkering with interest rates and quantitative easing (creating money on the Fed’s books). After pushing interest rates as low as they can go, the Fed has admitted that it has run out of tools.
At an IMF conference on November 8, 2013, former Treasury Secretary Larry Summers suggested that since near-zero interest rates were not adequately promoting people to borrow and spend, it might now be necessary to set interest at below zero. This idea was lauded and expanded upon by other ivory-tower inside-the-box thinkers, including Paul Krugman.
Negative interest would mean that banks would charge the depositor for holding his deposits rather than paying interest on them. Runs on the banks would no doubt follow, but the pundits have a solution for that: move to a cashless society, in which all money would be electronic. “This would make it impossible to hoard cash outside the bank,” wrote Danny Vinik in Business Insider, “allowing the Fed to cut interest rates to below zero, spurring people to spend more.” He concluded:
. . . Summers’ speech is a reminder to all liberals that he is a brilliant economist who grasps the long-term issues of monetary policy and would likely have made an exemplary Fed chair.
Maybe; but to ordinary mortals living in the less rarefied atmosphere of the real world, the proposal to impose negative interest rates looks either inane or like the next giant step toward the totalitarian New World Order. Business Week quotes Douglas Holtz-Eakin, a former director of the Congressional Budget Office: “We’ve had four years of extraordinarily loose monetary policy without satisfactory results, and the only thing they come up with is we need more?”
Paul Craig Roberts, former Assistant Secretary of the Treasury, calls the idea “harebrained.” He is equally skeptical of quantitative easing, the Fed’s other tool for stimulating the economy. Roberts points to Andrew Huszar’s explosive November 11th Wall Street Journal article titled “Confessions of a Quantitative Easer,” in which Huszar says that QE was always intended to serve Wall Street, not Main Street. Huszar’s assignment at the Fed was to manage the purchase of $1.25 trillion in mortgages with dollars created on a computer screen. He says he resigned when he realized that the real purpose of the policy was to drive up the prices of the banks’ holdings of debt instruments, to provide the banks with trillions of dollars at zero cost with which to lend and speculate, and to provide the banks with “fat commissions from brokering most of the Fed’s QE transactions.”
A Helicopter Drop That Missed Its Target
All this is far from the helicopter drop proposed by Ben Bernanke in 2002 as a quick fix for deflation. He told the Japanese, “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.” Later in the speech he discussed “a money-financed tax cut,” which he said was “essentially equivalent to Milton Friedman’s famous ‘helicopter drop’ of money.” Deflation could be cured, said Professor Friedman, simply by dropping money from helicopters.
But there has been no cloudburst of money raining down on the people. The money has gotten only into the reserve accounts of banks. John Lounsbury, writing in Econintersect, observes that Friedman’s idea of a helicopter drop involved debt-free money printed by the government and landing in people’s bank accounts. “He foresaw the money entering the economy through bank deposits, not through bank reserves which was the pathway available to Bernanke. . . . [W]hen Ben Bernanke fired up his helicopter engines he took the only path available to him.”
Bernanke created debt-free money and bought government debt with it, returning the interest to the Treasury. The result was interest-free credit, a good deal for the government. But the problem, says Lounsbury, is that:
The helicopters dropped all the money into a hole in the ground (excess reserve accounts) and very little made its way into the economy. It was essentially a rearrangement of the balance sheets of the creditor nation with little impact on the debtor nation.
. . . The fatal flaw of QE is that it delivers money to the accounts of the creditors and does nothing for the accounts of the debtors. Bad debts remain unserviced and the debt crisis continues.
Thinking Outside the Box
Bernanke delivered the money to the creditors because that was all the Federal Reserve Act allowed. If the Fed is to fulfill its mandate, it clearly needs more tools; and that means amending the Act. Harvard professor Ken Rogoff, who spoke at the November 2013 IMF conference before Larry Summers, suggested several possibilities; and one was to broaden access to the central bank, allowing anyone to have an ATM at the Fed.
Rajiv Sethi, Barnard/Columbia Professor of Economics, expanded on this idea in a blog titled “The Payments System and Monetary Transmission.” He suggested making the Federal Reserve the repository for all deposit banking. This would make deposit insurance unnecessary; it would eliminate the need to impose higher capital requirements; and it would allow the Fed to implement monetary policy by targeting debtor rather than creditor balance sheets. Instead of returning its profits to the Treasury, the Fed could do a helicopter drop directly into consumer bank accounts, stimulating demand in the consumer economy.
John Lounsbury expanded further on these ideas. He wrote in Econintersect that they would open a pathway for investment banking and depository banking to be separated from each other, analogous to that under Glass-Steagall. Banks would no longer be too big to fail, since they could fail without destroying the general payment system of the economy. Lounsbury said the central bank could operate as a true public bank and repository for all federal banking transactions, and it could operate in the mode of a postal savings system for the general populace.
Earlier Central Bank Ventures into Commercial Lending
That sounds like a radical departure today, but the Fed has ventured into commercial banking before. In 1934, Section 13(b) was added to the Federal Reserve Act, authorizing the Fed to “make credit available for the purpose of supplying working capital to established industrial and commercial businesses.” This long-forgotten section was implemented and remained in effect for 24 years. In a 2002 article on the Minneapolis Fed’s website called “Lender of More Than Last Resort,” David Fettig noted that 13(b) allowed Federal Reserve banks to make loans directly to any established businesses in their districts, and to share in loans with private lending institutions if the latter assumed 20 percent of the risk. No limitation was placed on the amount of a single loan.
Fettig wrote that “the Fed was still less than 20 years old and many likely remembered the arguments put forth during the System’s founding, when some advocated that the discount window should be open to all comers, not just member banks.” In Australia and other countries, the central bank was then assuming commercial as well as central bank functions.
Section 13(b) was eventually repealed, but the Federal Reserve Act retained enough vestiges of it in 2008 to allow the Fed to intervene to save a variety of non-bank entities from bankruptcy. The problem was that the tool was applied selectively. The recipients were major corporate players, not local businesses or local governments. Fettig wrote:
Section 13(b) may be a memory, . . . but Section 13 paragraph 3 . . . is alive and well in the Federal Reserve Act. . . . [T]his amendment allows, “in unusual and exigent circumstances,” a Reserve bank to advance credit to individuals, partnerships and corporations that are not depository institutions.
In 2008, the Fed bailed out investment company Bear Stearns and insurer AIG, neither of which was a bank. Bear Stearns got almost $1 trillion in short-term loans, with interest rates as low as 0.5%. The Fed also made loans to other corporations, including GE, McDonald’s, and Verizon.
In 2010, Section 13(3) was modified by the Dodd-Frank bill, which replaced the phrase “individuals, partnerships and corporations” with the vaguer phrase “any program or facility with broad-based eligibility.” As explained in the notes to the bill:
Only Broad-Based Facilities Permitted. Section 13(3) is modified to remove the authority to extend credit to specific individuals, partnerships and corporations. Instead, the Board may authorize credit under section 13(3) only under a program or facility with “broad-based eligibility.”
What programs have “broad-based eligibility” is not clear from a reading of the Section, but it isn’t individuals or local businesses. It also isn’t state and local governments.
No Others Need Apply
In 2009, President Obama proposed that the Fed extend its largess to the cash-strapped cities and states battered by the banking crisis. “Small businesses and state and local governments are having serious difficulty obtaining necessary financing from debt markets,” Obama said. He proposed that the Fed buy municipal bonds to cut their rising borrowing costs.
The proposed municipal bond facility would have been based on the Fed program to buy commercial paper, which had almost single-handedly propped up the market for short-term corporate borrowing. Investors welcomed the muni bond proposal as a first step toward supporting the market.
But Bernanke rejected the proposal. Why? It could hardly be argued that the Fed didn’t have the money. The collective budget deficit of the states for 2011 was projected at $140 billion, a drop in the bucket compared to the sums the Fed had managed to come up with to bail out the banks. According to data released in 2011, the central bank had provided roughly $3.3 trillion in liquidity and $9 trillion in short-term loans and other financial arrangements to banks, multinational corporations, and foreign financial institutions following the credit crisis of 2008. Later revelations pushed the sum up to $16 trillion or more.
Bernanke’s reasoning in saying no to the muni bond facility was that he lacked the statutory tools.. The Fed is limited by statute to buying municipal government debt with maturities of six months or less that is directly backed by tax or other assured revenue, a form of debt that makes up less than 2% of the overall muni market.
The Federal Reserve Act was drafted by bankers to create a banker’s bank that would serve their interests. It is their own private club, and its legal structure keeps all non-members out. A century after the Fed’s creation, a sober look at its history leads to the conclusion that it is a privately controlled institution whose corporate owners use it to direct our entire economy for their own ends, without democratic influence or accountability. Substantial changes are needed to transform the Fed, and these will only come with massive public pressure.
Congress has the power to amend the Fed – just as it did in 1934, 1958 and 2010. For the central bank to satisfy its mandate to promote full employment and to become an institution that serves all the people, not just the 1%, the Fed needs fundamental reform.
___________________
Ellen Brown is an attorney, president of the Public Banking Institute, and author of twelve books, including the best-selling Web of Debt. In The Public Bank Solution, her latest book, she explores successful public banking models historically and globally. Her blog articles are at EllenBrown.com.
Filed under: Ellen Brown Articles/Commentary |
WEB OF DEBT BLOG 
Dodd Frank plans to take control and regulate the Fund managers and personal IRAs in case of a market shock .
Click to access OFR_AMFS_FINAL.pdf
http://www.americanthinker.com/2013/12/obamas_plan_to_snatch_your_savings.html
Heres a Possible Shock …..
Is a threat to the dollar as worlds trade currency a China and Germany alliance ?????
http://www.ingoldwetrust.ch/gold-leasing-is-a-tool-for-the-global-credit-game
YES,yes, “Amend the Fed: We Need a Central Bank that Serves”…THE PEOPLE.
Why is it so difficult to understand a simple truth: “We the people have legislated the right to ‘print’ our money (via loans) and the right to tax that issuance (via interest) to the Private For Profit Banks (PFPB)? We have done this because we did not wish our governing body “to have sole control of this awesome power over the people..”. Do you think, maybe, perhaps, we should reconsider? All that the PFPB have done was “earn” almost all of the money issued over the last almost 100 years using the legal taxation called compound interest. Money they called ‘Interest Income’ which they unlike a Real People’s Central Bank, redistributed those gains for their own selfish interest. Doing a great job at maximizing their profits.
If all the loans on land and improved land value were to be made by the Monetary Sovereignty instead of simply guaranteed that the loans would be backed by 100% currency , it would only change the direction of who would receive the benefits of the action-Instead of PFPB the revenue raised would go to the US Treasury. Let’s say for example for a sum of $36 trillion (makes the math easy ) at 2% for 36 years would produce a “revenue, or income in place of an income tax of $2 trillion per year.
How good is that for all the people?
A SIMPLE FIX.
Amend the Fed. As Einstein said,”Make it simple.” “TERMINATE THE STUPID PRACTICE OF PAYING INTEREST ON OUR OWN MONEY TO PRIVATE BANKS .A PRACTICE THAT CAN ONLY END WITH A FINANCIAL BUST” “Justaluckyfool”,’Please,please read: http://bit.ly/MlQWNs
Dodd Frank plans to take control and regulate the Fund managers and personal IRAs in case of a market shock the the way the Treasury.gov link talks about risk assessment .
Click to access OFR_AMFS_FINAL.pdf
I found the info at this link;
http://www.americanthinker.com/2013/12/obamas_plan_to_snatch_your_savings.html
Heres a Possible Shock to the financial stability …..
Is a threat to the dollar as worlds trade currency a China and Germany alliance ?????
http://www.ingoldwetrust.ch/gold-leasing-is-a-tool-for-the-global-credit-game
Reblogged this on Spartan of Truth.
Ellen, great article. Things are starting to look up, with Sen. Rand Paul’s ideas on Detroit and the candidate running for Gov. of Florida who wants a public bank.
Have a Central Bank that will do unto us what they are doing for the private for profit banks.
“QE 4 The People” “Raise revenue by a taxation with another name: Interest”
Quantitative Easing (QE) is the Federal Reserve Bank’s way of doing what the Private For Profit Banks (PFPB) have been doing for almost a century now. It is the process of purchasing assets while creating deposits without spending any new money. The PFPB have been making loans for trillions of dollars and have declared these loans as deposits while using “temporary money” that is not issued by the Federal Reserve which is really just ‘printed out of thin air.’ Since 1913 this may have been in excess of $100 trillion. They have used this scheme to exploit over $100 trillion (Real money already issued) from the people of this nation. They have used this non-existent money as a source of raising revenue for their own PFPB, in amounts greater than double,even triple the $100 trillion by a taxing scheme they call “compound interest”. The results are called “Interest Income” to confuse you so that you are not aware that it is “taxation by another name”.
WHY not have the Federal Reserve Bank do “QE 4 The People” ?
A simple example:
For the last year the Fed (working for the banks) has purchased $85 billion per month of bank assets through its QE program. That will be recorded as ONE TRILLION DOLLARS of assets purchased from the banks in order to assist the PFPB to become solvent, while telling us that it should help the people.But should does not mean would.
If the Fed were working for the people they would have helped the people while at the same time assisted the PFPB.
Were it went wrong for the people and so right for the PFPB.
The Fed purchased “bank assets” that were ” bank liabilities to the Fed”, leaving the people without any help to pay their (peoples) liability to the PFPB.
The Fed purchased the Mortgage Backed Security , that is a note or bond that is a liability to the bank.
HOW would that QE program have created over one million new jobs, saved over one million homeowners and at the same time raise over $2 trillion in revenues for Congress to give back to the people by appropriations; if the Fed was working for the people ?
The solution is so simple that you will refuse to believe it, and to save face; deny it.
IF the Fed had purchased the Mortgages, yes, the actual mortgages that the people were obligated to pay; that is what would happen. If the Fed refinanced that $1 trillion with new mortgages at 2% for 36 years-the housing industry would become solid, new construction would be needed and $1 million homeowners would be able to beat foreclosure and be able to pay their mortgages.
Whyt do you not want prosperity for yourselves and your children?
Read more:
***** “Believe nothing merely because you have been told it…But whatsoever, after due examination and analysis,you find to be kind, conducive to the good, the benefit,the welfare of all beings – that doctrine believe and cling to,and take it as your guide.”- Buddha
“Justaluckyfool”,’Please,please read: http://bit.ly/MlQWNs
“The Fed needs fundamental reform”, and fundamental monitoring as well as fundamental accountability, to the Government of the USA. The “revolving door” between the Fed, Treasury, Government and The White House must be “bolted shut” as well, to avoid the massive conflict of interest that is currently exposed for all to see.
“This is a big club, and you ain’t in it”- George Carlin.
Thumbs up!
If anything legislation is moving in the other direction. I was just listening to Steven Keen on the Keiser Report and Keen revealed the banksters just had a section of Dodd Frank repealed which allows the Fed to directly supply credit or money to the public domain. The banksters are the epitome of self interested greed along with their hirlings in the political class….
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Personally, I think you would wasting time ‘amending’ or fiddling around the edges of the current financial system. The notion that these people are ‘brilliant economists’ is laughable and so are their idiot theories and models which are predicated around
‘financialisation’. None of this rubbish addresses how you, firstly, create real and sustainable value and secondly, the physical constraints of the system – you cannot create infinite debt, nor can you assume an endless supply of easily accessible energy and resources and you cannot maintain social cohesion with millions unemployed and underemployed while a small minority continually enriches themselves
I would suggest that the solution would be a root and branch rebuild as the system is systemically corrupt – LIBOR manipulation, physical market manipulation (JPM and Aluminium), currency manipulation, manipulation of various Bond markets, financial oppression of viable business operations (Royal Bank of Scotland), threat to sovereign governments, next to zero disclosure and regulatory oversight, etc.
There are two paths. The first is the re-building the financial system of the world and have the banks operate as boring financial ‘utilities’. This would eliminate all the non value add financial instruments as all they do is create ‘volatility’ and are a means by which value can be ‘skimmed’ from Main Street – value they don’t earn. In fact I would argue that the banks destroy value. This would be challenging and those that own the system and benefit from it would be unable or unwilling to reform it. In any event it seems they have brought and paid everyone that might challenge their preminance.
The second path is the more likely one with the system collapsing totally and absolutely. The ramifications of this would be dire as the loss of the financial system would collapse the world’s trading system and impact the physical production of food, other goods, etc. What would come after this one could only guess.
Yes, the Fed needs to be changed. From the Fed’s birth in 1913 until 1933 the US Treasury furnished notes (showing how much “money” was owed by a bank to the bearer) to the Fed at the cost of printing. When gold backing was removed by FDR in 1933, creating fiat currency, those notes became “money” but the US Treasury continued to sell them to the Fed for the cost of printing. Presently the Fed pays 9.7 cents for each $100 bill printed by the US Treasury. giving up the $99.903 of seigniorage. There is a fairy tale that the seigniorage is recovered by interest on debt held by the Fed being transferred to the Treasury but it is only a fairy tale. We need a monetary system where the government issues all money, not just coin, into the economy.
Ellen…
Your grasp of economics has always impressed me. But, rather than “amending” the Fed… don’t you think the whole concept of debt-based money should be entirely abolished?
Every time debt-free money has been tried (with honest checks and balances), it works. In my opinion, this is the road we must take… and the clarion call we must trumpet. “DEBT-FREE MONEY!” Period.
[…] Ellen Brown Writer, Dandelion Salad The Web of Debt Blog December 7, […]
Ellen, i agree with some of the commenters here about abolishing debt based money and I know you have advocated that in your talks and writing but the reality is that we are dealing with what is politically possible and we know that what you are suggesting in this article is, in itself a tough sell in Washington.
Considering that there probably a majority of people do not even know that the Federal Reserve is not really federal, do you think it would be possible to get some of the major newspapers to print this article in their Sunday editions on Dec. 22 to signify Federal Reserve day on the following day?
I think the Federal Reserve Central Banking institutes are internationally trying to keep their position in world trade as the trade currency like its been since the end of WW2 and they are printing and extending this capital allocation trying to keep the world nations from going away from the dollar and for another currency or set of currencies in a basket like say what the BRICS have suggested as a SDR system .
The latest trade agreement called the Trans Pacific Partnership trying to be hatched is a further attempted to keep nations divided and herded away from the BRICS desires to keep the dollar relevant as the trade currency in the TPP trade Policy but the USA will sacrifice all liberties with this agreement .
The currency war of this century is going to get dicey .
See how the Federal Reserve Central banking system uses the 2 big 2 fail to funnel and keep the lure out there for dollars , I mean if you offer enough capital a persons greed sooner or later gives in to the lure …….
JPMorgan Tracked Business Linked to China Hiring
http://dealbook.nytimes.com/2013/12/07/bank-tabulated-business-linked-to-china-hiring/?nl=todaysheadlines&emc=edit_th_20131208&_r=0
[…] This piece first appeared at Web of Debt. […]
[…] This piece first appeared at Web of Debt. […]
[…] Read More […]
Abolish the USARY and a great deal of the national debt would magically disappear. Rather than “amend” the FED, we should abolish the FED. It’s the USARY, stupid!
This link describes both the problem and suggests a method for solving it. BTW, it does payoff the national debt with about 1.5T$ leftover to make us a creditor nation. It adheres to Ellen’s notions, too.
http://realmoneyecon.org/lev2/answers.html
[…] Amend the Fed: We Need a Central Bank that Serves Main Street […]
If the Bank of North Dakota is the preferred template, why not have each state operate it’s own similar public bank to set its own interest rates as the local economy dictates?
The ownership of each bank would rest soley with its respective state, would be answerable to the legislature for compliance with bank policies, and would have no obligation to serve private banking interests except to the extent those corporations were engaged in activities directly benefitting people of that state.
[…] naar andere sites. Daarna is de MACHTSOVERNAME of noem het gewoon een ordinaire staatsgreep door DE BOER een feit. En die laatste is eigenlijk diegene die op het plaatje van de toneelspelers zou moeten […]
WOW! It’s the UK, but it’s the same problem.
Positive Money is a movement to democratise money and banking so that it works for society and not against it.
Our current financial system has left us with the highest personal debt in history, unaffordable housing, worsening inequality, high unemployment and banks that are subsidised and underwritten with taxpayers’ money. We believe that these problems have a common root: money.
What’s the Problem with Money?
Many of the big social and economic problems that we’re facing today are connected to money. If we want to solve these problems, we have to change the way that money is created. Most of us learn that only the government can create money, but in reality more than 97% of money is created by private banks – the same banks you see on the high-street every day.
The money banks create isn’t the paper money you keep in your wallet. It’s the electronic money that flashes up when you check your balance at an ATM. Find out How Banks Create Money…
Banks create this electronic money whenever they make a loan. That means for every pound in your bank account, someone else must have a pound of debt. The authorities find it very difficult to limit how much money – and debt – that banks can create. As a result personal debt is now higher than ever before.
MORE: Why is there so much debt?Inequality
Since almost all of our money is ‘on loan’ from banks, someone must pay interest on nearly every pound in the UK. This interest redistributes money from the bottom 90% of the population to the top 10%. The money banks create also pushes up house prices, and blows up bubbles in financial markets – making the very rich even richer.
Join the Campaign!
Join the 16,548 of us who know that our money system needs fundamental changes if we want an economy that works for people, not banks.
http://www.positivemoney.org/
Mrs Brown , whatdo you think about this ? http://neweconomicperspectives.org/2013/12/krugman-helicopters-consolidation.html
[…] Web of Debt, by Ellen […]
[…] https://ellenbrown.com/2013/12/07/amend-the-fed-we-need-a-central-bank-that-serves-main-street/ […]
The only thing that makes sense is to end the fed. End the IRS and go back to what we had before 1913. Not perfect, but the depressions and cycles were much worse with the fed in charge. Anything run by bankers is going to be for them and no one else. Not the We the People or the USA.
The fed along with FDR made the depression last many years longer. The fed also forced thousands of banks to join the fed or go out of business. Many did go out of business rather than join the fed monster.
To save us and our country it needs to go. Now is a good time since the charter is up this month.
I believe the Fed’s charter can only be withdrawn now “for reasons”. And there are reasons. The Fed mandate is to maintain full employment and a no inflation money supply. They have failed on both counts which is a bases for revoking the charter. There are many ideas around on how to set up a monetary system sans Fed. They include a very well thought out arrangement that includes paying off the national debt over a weekend as was done in the 1830s when Biddle’s 2nd US Bank was shut down by Jackson.
Former Congressman Dennis Kucinich introduced a bill to nationalize the FED. Why not resurrect it?
That is a great idea but first, in order to have it pass, we need a big public education program to inform people why it needs to be done. The commercial media, beholden to banking interests, cannot be expected to help educate the public.
Who would run it? The same bankers would weasel there way in to take it over and we would be in the same situation.
Running the monetary system from the govt side would be much easier than running it from a CB. The govt has strong tools to control both the quantity of money in circulation and the distribution of that money. Tax policy can control the distribution of money and the quantity of money in circulation. Spending can be used to increase the money in the hands of the public. These tools are orders of magnitude stronger than the interest rate, discount rate and open market operations available to the Fed/CB.
But, if the new system was introduced, the “weasel Bankers would be ACCOUNTABLE, and regular audits, and performance appraisels, would be carried out
“Who would run it? The same bankers would weasel there way in to take it over and we would be in the same situation.” NO.
Not if we were to amend the Fed to make it an independent bank responsible to the people. All of what we know as today as banks will be deemed what they are; Private for profit banks and shall be as Keynes, Minsky, Soddy and thousands of others called for, “Separated from government”.
Use their own money for their own customers to do what they are supposed to do; maximize profits.
Excerpt from “Justaluckyfool”;
“*( Paraphrasing Frederick Soddy, “The Role Of Money”)
Actual quote,”Money now is the NOTHING you get for the SOMETHING before you can get ANYTHING”.
Money has an owner when it is in existence; someone must give up “SOMETHING” in order to get this “NOTHING”. The Sovereign Government does not own this ‘money ‘ (Nothing) it is merely the caretaker and enforcer of the redeemable rights of this sovereign nations fiat currency. If the sovereignty is a capitalistic society, all the fiat currency that it issues is by law and “good faith” redeemable into ANYTHING. The actual Wealth of the Nation is transferable into sovereign currency; stored by the government and accountable to the social group.
The entire social group owns the entirety of wealth of the nation, either expressed in its physical form (goods and services not yet produced) as well as that which has already been made fiat currency.
Every nation that has its own fiat currency, needs a banking system-a central bank that is accountable for the issuance and control of the quality and quantity of its currency.
4. The owner of the goods and services of the Sovereign Group that is a capitalistic society is the combined individuals of the society. Each one owns that portion of wealth now and until death or until they decide to GIVE those rights of exchange to anyone else.
5. A Monetary Sovereignty that is a capitalistic society is only a caretaker of the wealth of the entirety and as such should have a Central Bank that will be the accountable guardian of the Sovereign wealth.
6. As guardian, the Central Bank does not own the currency. They must control the quality and quantity for its owners-the people and must be able to redeem the NOTHING they issue for ANYTHING upon demand. The Central Bank MUST be the ONLY entity that may issue
new currency.
Read more:
Where we went wrong and how to fix it.
FREE, yes no money required. Download this book :
“The Role of Money” by Frederick Soddy (written in 1926, 1931)
http://archive.org/details/roleofmoney032861mbp
ALSO: http://www.positivemoney.org/
Then read a FOOLS interpretation:
http://bit.ly/MlQWNs
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