Entry for the President’s Brainstorm Page: TAKE BACK THE POWER TO CREATE MONEY FROM THE PRIVATE BANKING INDUSTRY

Today was the last day to submit entries to the President’s Open Government Brainstorm page. I submitted the one below. The website has a place to vote (“Looks Promising!” “Not So Sure.”) If you feel like voting, the link is here —

http://opengov.ideascale.com/akira/dtd/3648-4049

The Constitution states, “Congress shall have the power to coin money and regulate the value thereof.” This power has been abdicated to private bankers. Today, 99.99% of our money is created by private banks when they make loans. This includes the Federal Reserve, a private banking corporation, which orders Federal Reserve Notes to be printed, and then lends them to the U.S. government. Only coins are actually created by the government itself. Coins compose only about 1-10,000th of the M3 money supply, and Federal Reserve Notes compose about 3% of it. All of the rest is created by banks as loans, something they do by simply writing numbers into accounts.

Congress could take back the power to create the national money supply by:
(a) Nationalizing the Federal Reserve.
(b) Reviving the Reconstruction Finance Corporation, a government-owned lending facility used by Roosevelt to fund the New Deal. Rather than merely recycling borrowed money as Roosevelt did, however, the RFC could actually create credit on its books, in the same way that banks do it today, by fanning its capital base into many times that sum in loans. Assuming $300 billion is left of the TARP money approved by Congress last fall, this money could be deposited into the RFC and leveraged into $3 trillion in loans. That’s based on a 10% reserve requirement. If the money were counted as capital, at an 8% capital requirement it could be leveraged into 12.5 times the original sum. That would be enough to fund not only President Obama’s stimulus package but many other programs that are desperately short of funding now.

Many references are available which will be furnished on request. See generally http://www.webofdebt.com/articles.

BUT GOVERNOR, YOU CAN CREATE MONEY! JUST FORM YOUR OWN BANK.

Christmas comes early, Governor. You CAN print your own money. Fiscally solvent North Dakota is doing it . . . and so can California. Now!!! Here’s how . . . .

Read more here –
http://www.webofdebt.com/articles/but_governor.php

TIME TO GET OUT THE WHEELBARROWS? ANOTHER LOOK AT THE WEIMAR HYPERINFLATION

Worried commentators are predicting a massive hyperinflation of the sort suffered by Weimar Germany in 1923, when a wheelbarrow full of paper money could barely buy a loaf of bread. But there is something puzzling in the data. The British government is already funding more of its budget by seigniorage than Weimar Germany did at the height of its massive hyperinflation. Yet the pound is still holding its own, under circumstances said to have driven the German mark to one-trillionth of its former value. Something else besides mere money-printing to meet the government’s budget must have been responsible for collapsing the German mark, but what? And are we threatened by the same risk today?

Read more here –
http://www.webofdebt.com/articles/hyperinflation.php

THE TOWER OF BASEL: DO WE REALLY WANT THE BANK FOR INTERNATIONAL SETTLEMENTS ISSUING OUR GLOBAL CURRENCY?

Earlier this month, the G20 leaders agreed to inject $250 billion in SDRs or Special Drawing Rights into the world economy. In an April 7 article titled “The G20 Moves the World a Step Closer to a Global Currency,” Ambrose Evans-Pritchard wrote that “In doing so, they are putting a de facto world currency into play. It is outside the control of any sovereign body. Conspiracy theorists will love it.” The article is subtitled, “The world is a step closer to a global currency, backed by a global central bank, running monetary policy for all humanity.” Which naturally raises the question, who or what will serve as this global central bank, cloaked with the power to issue the global currency and police monetary policy for all humanity? When the world’s central bankers met last September, the Bank for International Settlements was suggested . . . .

Read more here –

http://www.webofdebt.com/articles/basel.php

Translated into Italian by Marco Giacinto on www.truciolisavonesi.it here:
http://www.truciolisavonesi.it/articoli/numero199/brown.htm – Part 1
http://www.truciolisavonesi.it/articoli/numero200/brown.htm – Part 2

REVIVE LINCOLN’S MONETARY POLICY: AN OPEN LETTER TO PRESIDENT OBAMA

REVIVE LINCOLN’S MONETARY POLICY: AN OPEN LETTER TO PRESIDENT OBAMA

Ellen Brown, April 8th, 2009
http://www.webofdebt.com/articles/lincoln_obama.php


Dear President Obama:

The world was transfixed on that remarkable day in January when, to poetry, song, and dance, you gazed upon Abraham Lincoln’s likeness at the Lincoln Memorial and searched for wisdom to navigate these difficult times. Indeed, you have so many things in common with that venerable President that one might imagine you were his reincarnation in different dress. You are both thin and wiry, brilliant speakers, appearing on the national stage at pivotal times. Fertile imaginations could envision you coming back dressed in that African heritage you freed, to help heal the great scar of slavery and prove once and for all the proposition that all men are created equal and can achieve great things if given a fighting chance.

As Wordsworth said, however, our birth is but a sleep and a forgetting; and if that is true, you may have forgotten a more subtle form of slavery from which Lincoln tried less successfully to free his countrymen.  You may have forgotten it because it has been omitted from our popular  history books, leaving Americans ill-equipped to interpret the lessons of our own past.  This letter is therefore meant to remind you.

President Obama, we are now met on another battlefield of that same economic war that visited Lincoln and the Founding Fathers before him.  For you to finish the work Lincoln started would be a poetic triumph no American could miss.  The fate of our economy and the nation itself may depend on how well you understand Lincoln’s monetary breakthrough, the most far-reaching “economic stimulus plan” ever implemented by a U.S. President.  You can solve our economic crisis quickly and permanently, by implementing the same economic solution that allowed Lincoln to win the Civil War and thus save the Union from foreign economic masters.

Lincoln’s Monetary Breakthrough

The bankers had Lincoln’s government over a barrel, just as Wall Street has Congress in its vice-like grip today. The North needed money to fund a war, and the bankers were willing to lend it only under circumstances that amounted to extortion, involving staggering interest rates of 24 to 36 percent. Lincoln saw that this would bankrupt the North and asked a trusted colleague to research the matter and find a solution. In what may be the best piece of advice ever given to a sitting President, Colonel Dick Taylor of Illinois reported back that the Union had the power under the Constitution to solve its financing problem by printing its money as a sovereign government. Taylor said:

Continue reading

THINKING POSITIVELY ABOUT MONETARY POLICY: HOW ‘QUANTITATIVE EASING’ COULD BE HARNESSED FOR THE PUBLIC GOOD

Nervous pundits are predicting the end of American life as we know it, after Fed Chairman Ben Bernanke announced on March 18 that he would be dropping yet another trillion dollars in helicopter money – up to $300 billion to buy long-term government bonds and an additional $750 billion to buy private debt, with the Term Asset-backed Securities Loan Facility (TALF) to be opened up for the sake of consumers and small businesses. The dollar immediately experienced its worst drop in 25 years, amid worries that the Fed’s intervention would spur hyperinflation.

Read more here —
http://www.webofdebt.com/articles/bernanke.php

Josh Harkinson, “How the Nation’s Only State-Owned Bank Became the Envy of Wall Street,” Mother Jones 3-27-09

The Bank of North Dakota is the only state-owned bank in America—what Republicans might call an idiosyncratic bastion of socialism. It also earned a record profit last year even as its private-sector corollaries lost billions. To be sure, it owes some of its unusual success to North Dakota’s well-insulated economy, which is heavy on agricultural staples and light on housing speculation. But that hasn’t stopped out-of-state politicos from beating a path to chilly Bismarck in search of advice. Could opening state-owned banks across America get us out of the financial crisis? It certainly might help, says Ellen Brown, author of the book, Web of Debt, who writes that the Bank of North Dakota, with its $4 billion under management, has avoided the credit freeze by “creating its own credit, leading the nation in establishing state economic sovereignty.” Mother Jones spoke with the Bank of North Dakota’s president, Eric Hardmeyer.

Read the rest here —  http://tiny.cc/RhE5T

Cash-starved States Need to Play the Banking Game: North Dakota Leads the Way

Forty-six of fifty states are insolvent and could be filing Chapter 9 bankruptcy proceedings in the next two years. One of the four states that is not insolvent is an unlikely candidate for the distinction – North Dakota. What does the State of North Dakota have that other states don’t? The answer seems to be: its own bank.

Read more here — http://www.webofdebt.com/articles/state_bank_option.php

If you like this idea, here is a sample letter to send to your congresspeople, prepared by Charlie Fleetham —

https://webofdebt.wordpress.com/sample-letter-to-congressmen-forming-a-state-owned-bank/

Standing Up to the Banks: Make Them Produce the Note!

This is a followup to my post of July 30, 2008, “Standing Up to the Banks: How to Challenge Your Foreclosure.”  The make-them-produce-the-note defense has made it to prime time.  This clip is from “Good Morning America!” —

http://www.youtube.com/watch?v=fx7YkiH79nw

A lobby of many people prepared to bring this defense could have some significant clout in Congress.

MONETIZE THIS! A Better Way to Fund the Stimulus Package

Funding the government’s budget shortfall has usually been left to private lenders; but those loans are drying up, and servicing them is proving expensive. Both this interest burden and the need to continually attract new lenders could be avoided by tapping into the government’s credit line at its own central bank . . . .

Read more —

http://www.webofdebt.com/articles/monetizethis.php

Mysterious Prison Buses in the Desert

Prison buses are driving around empty in the Tucson area.  Are Wackenhut and the DHS preparing for civil unrest?

Read more —

http://www.webofdebt.com/articles/wackenhut.php

HOW TO RESOLVE THE CREDIT CRISIS: GIVING CREDIT WHERE CREDIT IS DUE

Economist John Kenneth Galbraith famously said, “The process by which banks create money is so simple that the mind is repelled.”  If banks can create money, why are we suffering from a “credit crunch”? Why can’t banks create all the money they can find borrowers for? 

                                                                                                                 Read more . . .

Price fixing in the bond market by the Fed?

Interesting observation on the Yahoo! Message Board (UltraShort Lehman 20+ Trsy ProShares), December 31, 2008:

It seems as if one branch of the government (Treasury) needs money, so they auction off T-bills and T-notes. Obviously, the lower the interest rate, the better (less interest for us taxpayers to have to pay).

So now, another pseudo-branch of the government (Federal Reserve Bank – chartered by Congress in 1913) is now buying most of these T-bills and T-notes and putting them on their balance sheet. They are doing so in a scheme to keep the interest rates as low as possible. In other words, they have stepped in front of the market and now ARE the market for T-bills and notes. There are other buyers and sellers of T-notes and bills, but due to the size of the Federal Reserve, and the depth of their pockets, they are elbowing everyone else out of the market.

How is this even possible? Isn’t this price-fixing? The government is essentially selling T-bills and notes to itself in order to fix the interest rate? Shouldn’t this be illegal? This certainly seems to have more than a whiff of fraud to it, and yet our entire economic system is based on the premise of government selling debt instruments to itself? I am new to the bond market (certainly not an insider, and not someone who has “seen it all” by any means). But my reaction as an outsider looking in, is that this is a “scam”, a “scheme”, or whatever derogatory noun you would like to place upon it.

We charge Bernie Madoff for conducting a ponzi scheme. Is this “scheme” any less fraudulent than Bernie Madoff’s simply because two agencies of the Federal Government are the ones running it?

Seriously, what am I missing? I would appreciate it if someone would step forward and tell me “hey, wait a minute. You’ve missed something here (some very important fact about this arrangement) and this is why this is all legitimate.”

Thanks in advance. I am trying to understand this crazy world we live in…

Borrowing from Peter to Pay Paul: The Wall Street Ponzi Scheme Called Fractional Reserve Banking

Bernie Madoff showed us how it was done, but his Ponzi scheme was small compared to one that has been perpetrated for hundreds of years by the banking system itself. What distinguishes the legal scheme known as “fractional reserve” lending from the illegal schemes of Madoff and his ilk is that the bankers’ scheme is protected by government charter and backstopped with government funds. The sheer size of the bailout efforts today, however, indicates that the banking scheme has reached its mathematical limits and needs to be superseded by something more sustainable.

Read more:   http://www.webofdebt.com/articles/ponzi.php

GROUND ZERO ON WALL STREET: FED FUNDS AND TREASURY BILLS HIT 0% INTEREST

The federal funds rate and the interest on 3-month Treasury bills both just hit ZERO percent. This means banks and the government are borrowing money for free. Yet demand for the T-bills at auction was four times the available supply! Who is clamoring to buy the debt of the world’s most insolvent debtor for no return at all — and why?

Read more  —  http://www.webofdebt.com/articles/zero_percent_t-bills.php

Sustainable Government: Banking for a “New” New Deal

Even before taking office, Obama has started his version of the “fireside chats” (updated from radio to online video) given by Roosevelt nearly weekly to reassure the public. He said on November 22 that he plans to create 2.5 million new jobs by 2011 and kick-start the economy by building roads and bridges, modernizing schools, and creating technology and infrastructure for renewable energy. These are excellent ideas, but what will they be funded with—more government debt?

Read morehttp://www.yesmagazine.org/article.asp?id=3162

“Oops, We Meant $7 TRILLION!” What Hank and Ben Are Up to and How They Plan to Pay for It All

The $700 billion that was arm-twisted from Congress in October was just the camel’s nose under the tent. The Paulson/Bernanke team is now prepared to pay $7.76 trillion to rescue the financial system. Prepared to pay how? Congress has not raised its debt ceiling to that level, and the Fed doesn’t have the funds on its books . . .

Read whole article here — http://www.webofdebt.com/articles/oops.php

All Is Well in Stepfordville: More on the Pre-election Chicanery of the Plunge Protection Team

It was another surreal week on Wall Street, with the Dow Jones Industrial Average rising a thousand points while the economy continued to sink into its worst financial crisis since the Great Depression. More evidence of the Plunge Protection Team at work? The election was only days away . . .

Read more — http://www.webofdebt.com/articles/stepfordville.php

THE NOT-SO-INVISIBLE HAND: HOW THE PLUNGE PROTECTION TEAM KILLED CAPITALISM

October 24 marks the 79th anniversary of the October 1929 stock market crash.  Many feared a repeat of this disaster on Friday, October 24, 2008; but remarkably, disaster was averted.  How?  Suspicious observers saw the hand of the Plunge Protection Team pulling strings behind the scenes . . .

Read more

http://www.webofdebt.com/articles/manipulation.php

THE COLLAPSE OF A 300 YEAR PONZI SCHEME: THE REAL DEBATE IS CRONY SOCIALISM OR FINANCIAL SOVEREIGNTY

Last night, the Presidential candidates had their last debate before the election. They talked of the baleful state of the economy and the stock market; but omitted from the discussion was what actually caused the credit freeze, and whether the banks should be nationalized as Treasury Secretary Hank Paulson is now proceeding to do. The omission was probably excusable, since the financial landscape has been changing so fast that it is hard to keep up. A year ago, the Dow Jones Industrial Average broke through 14,000 to make a new all-time high. Anyone predicting then that a year later the Dow would drop nearly by half and the Treasury would move to nationalize the banks would have been regarded with amused disbelief. But that is where we are today.

Read more —

http://www.webofdebt.com/articles/modest_proposal.php