LaRouche Denounces Imperial Scheme

[PolyNewbie]

BC:Particular to your error, United States Notes can still be found in circulation.

How many were produced last year ? I think model T's are still around too.

[bush_cheney2004]

and the supposed difference between these supposedly different notes?

and how does getting paid in one differ from getting paid in the other?

Moot point, as most people of are not paid with bank notes, excepting drug dealers, prostitutes, etc....but I will keep an open mind about such matters. Payment by United States Note may provide numismatic value beyond face value if recognized by a collector, but most are just spent as legal tender for booze or cigarettes.

[GostHacked]

I have read 1984. There are similarities that are close to what is happening today:

The fact that you are able to read your conspiracy theory websites and watch your conspiracy theory movies coupled with the fact that you can post your conspiracy theories without threat should indicate to you that the world we live in today is unlike the fictional world George Orwell created in 1984.

I guess, if it is not exactly like the book, then the argument is useless. There are similarities however. I have read the book and watched the movie several times.

Look at how much surveilance is done now. Great Britian is a PRIME example of how Big Brother is taking over. There are wars going on in places we don't even know exist. The divide between poor and rich is getting wider, and the amount of rich people grows slowly while the poor population is exploding.

Now back to the topic.

From what I know about money and economics (and it is not much), something is missing here. It used to be that the amount of currency that is in circulation must be backed up by hard currency like gold, silver, ect. If you have more money out there than what you can back up in with hard currency, then when people come to cash in their stock, they are either not going to get the whole value of it, or maybe nothing at all.

100 lbs of gold for sake of argument is equivilant to 100 dollars. A pound of gold is one dollar. The current cirulation of money out there is much more than 100 dollars. There are 11 people each with 10 dollars in their pockets. Someone is going to get the shaft, or all of them are going to be getting less gold than what the monetary notes are stated as being worth.

So the math does not add up. Now inflation comes into play. Is inflation needed to counteract the deficit of backed up hard currency for the circulation of monetaryt notes? So we raise the value of what the gold is worth in order to compensate for the deficit of hard currency to paper money?

Moot point, as most people of are not paid with bank notes, excepting drug dealers, prostitutes, etc....but I will keep an open mind about such matters

Most of our transactions now are paperless. Electronic money transfers. Credits if you will. Cashless society. This is what you are 'virtualy' worth now. Paper money will eventually go out of circulation to be replaced by an electronic system. Credit card. Debit Card and the like.

[bush_cheney2004]

From what I know about money and economics (and it is not much), something is missing here. It used to be that the amount of currency that is in circulation must be backed up by hard currency like gold, silver, ect. If you have more money out there than what you can back up in with hard currency, then when people come to cash in their stock, they are either not going to get the whole value of it, or maybe nothing at all.

100 lbs of gold for sake of argument is equivilant to 100 dollars. A pound of gold is one dollar. The current cirulation of money out there is much more than 100 dollars. There are 11 people each with 10 dollars in their pockets. Someone is going to get the shaft, or all of them are going to be getting less gold than what the monetary notes are stated as being worth....

No, that's the beauty of fractional reserve banking. The banks can mitigate and such risk by selling interest bearing bonds and other instruments to offset their exposure....effectively drying up demand for immediate redemption at face value.

[PolyNewbie]

Ghost Hacked: From what I know about money and economics (and it is not much), something is missing here. It used to be that the amount of currency that is in circulation must be backed up by hard currency like gold, silver, ect. If you have more money out there than what you can back up in with hard currency, then when people come to cash in their stock, they are either not going to get the whole value of it, or maybe nothing at all.

100 lbs of gold for sake of argument is equivilant to 100 dollars. A pound of gold is one dollar. The current cirulation of money out there is much more than 100 dollars. There are 11 people each with 10 dollars in their pockets. Someone is going to get the shaft, or all of them are going to be getting less gold than what the monetary notes are stated as being worth....

You could watch the video links I have posted. Money As Debt is a 47 minute cartoon. Nothing could be easier. An 8 year old could understand it. Its a brilliant piece of work, the favorite amoung monetary reformers all over the world.

You have listened to me rant about the banks for 6 months. You have told me that I am all wrong in how I handle everything - advice that I didn't even ask for - you state you know nothing about money and you still haven't watched this video. Why don't you give it 5 minutes and if you don't like it the just stop watching it.

[PolyNewbie]

Riverwind:Giving the government (or anybody) free money removes the incentive to use the money in ways that will generate the best ROI.

Who is giving anyone free money ? Who suggested this ? Do you just make everything up as you go along ?

Are you some kind of cointelpro operative that is using stupidity as some form of psychological warfare ?

[Riverwind]

You could watch the video links I have posted. Money As Debt is a 47 minute cartoon.

The video completely misrepresents the process of creating money via loans. When a bank creates money via a loan it assumes a liability because the person who borrows the money will spend it. If the borrowed money ends up in the another bank then the lender with have to provide cash immediately to the other bank to cover the value of the loan. This means banks generally will not lend money unless they have enough cash to cover it. Even if the borrowed money ends up in the same bank the bank will now have to pay interest on that money they created for the loan.

The net result is banks only make money on the difference between the interest on the loan and the amount they pay in interest. The suggestion that banks make a profit equal to the face value of the loan is unequivocally false.

[GostHacked]

You have listened to me rant about the banks for 6 months. You have told me that I am all wrong in how I handle everything - advice that I didn't even ask for - you state you know nothing about money and you still haven't watched this video. Why don't you give it 5 minutes and if you don't like it the just stop watching it.

Well if I give it 5 mintues, I am not going to get anything out of it, cause it is 47 minutes long!!!

Let me rephrase my statement then. I don't know a lot about money/currency apart from videos I have watched on the subject. But basic math shows me that something is missing and many are not getting full value of the dollar. I have seen many videos regarding the Federal Reserve and how it works. I have a basic understanding, but I am no freaking expert on it. I never claim to be an expert on anything here.

And when you do this

Are you some kind of cointelpro operative that is using stupidity as some form of psychological warfare ?

This is what I am talking about.

Also, when you state, HERE WATCH THIS video, and in the next paragraph (now this is before you even posted the reply) you complain that I have not even watched the movie yet. This is the crap I am talking about. Makes my head hurt dude.

I may just have seen it before. I remember watching this video earlier this year and other vids on the Federal reserve. That by no means makes me a freakin expert on it. And by you watching the videos, does not make you smarter than me or better than me for whatever reason.

It's like a girl you want to date. But you keep calling her names, and telling her she does not know anything. Chances are you are not going to get anything from this girl. She wants nothing to do with you. This is what I see when you try to get some truth to the masses. It is all in the approach/delivery.

[Riverwind]

But basic math shows me that something is missing and many are not getting full value of the dollar.

It is a mistake to assume that there should be a connection between a currency and a single commodity. The value of commodities changes over time - some become more expensive but others would be cheaper depending on supply or demand. A dollar will allow you to buy things because people believe in it - so it has value in itself and no one with losing out. A fixed exchange between a dollar and gold does not do you any good if the price of oil goes up when compared to gold.

[PolyNewbie]

Ghost Hacked:And by you watching the videos, does not make you smarter than me or better than me for whatever reason.

Thats probably true but the books I have read and the courses I have taken probably does in terms on monetary issues and economics.

[PolyNewbie]

Riverwind:The video completely misrepresents the process of creating money via loans. When a bank creates money via a loan it assumes a liability because the person who borrows the money will spend it. If the borrowed money ends up in the another bank then the lender with have to provide cash immediately to the other bank to cover the value of the loan. This means banks generally will not lend money unless they have enough cash to cover it. Even if the borrowed money ends up in the same bank the bank will now have to pay interest on that money they created for the loan.

No, it doesn't. Lots of economists like it. Its you that misrepresents just about everything with your know it all attitude and know nothing reality. You have misrepresented banking in the above statement.

[Riverwind]

No, it doesn't. Lots of economists like it. Its you that misrepresents just about everything with your know it all attitude and know nothing reality. You have misrepresented banking in the above statement.

Here is a good tutorial that explains it properly.

The key point:

The maximum amount of money that a bank can create is equal to its excess reserves. For example:

If the reserve requirement is 10% and the total deposits are $2100 then the required reserves are $210.

If the bank has $300 in reserves then the _most_ it can lend out is $300 - $210 = $90.

When it comes to banking the claims that you make are unequivocally wrong. Try reading an economics textbook for once instead of Internet opinion pieces.

Go ahead and repeat your claim that economics textbooks are wrong - it will simply demonstrate how much tunnel vision you have when it comes to your sources of information.

[PolyNewbie]

The maximum amount of money that a bank can create is equal to its excess reserves. For example:

If the reserve requirement is 10% and the total deposits are $2100 then the required reserves are $210.

If the bank has $300 in reserves then the _most_ it can lend out is $300 - $210 = $90.

This is an example of simple thinking and posting as if you are some kind of authority when clearly you are not. This is normally the case with Riverwind as has been shown repeatedly. I don't tolerate this kind of thing and when you post something you should understand what you are talking about or else get called on it.

Lets start with the $2100.00

The bank lends out 1990.00 and that gets deposited in the bank as another asset. The banks assets then become 2100 + 1990, of which 90 % of the additional $1990 can be lent out. The net owed to the banks becomes

$2100 + $1990 + $1791 + $1611 + $1450....+ = $21,000. This is the mechanism for which banks create money and how a $ 2100.00 deposit becomes $21,000.00. Almost $19,000.00 has been created from thin air.

Of course the lent money may be deposited in another bank by (for example) a car dealership, but that all works both ways. This bank gets deposits when someone borrows from another bank to buy a swimming pool. The swimming pool dealer may put his money in this bank.

All the money that isn't in cash is held in a bank somewhere.

[PolyNewbie]

If I were you Riverwind, I would stop replying to my posts - *especially* when you feel the urge to educate me.

The textbooks are not wrong. They just don't tell the whole truth.

[kuzadd]

You could watch the video links I have posted. Money As Debt is a 47 minute cartoon.

The video completely misrepresents the process of creating money via loans. When a bank creates money via a loan it assumes a liability because the person who borrows the money will spend it. If the borrowed money ends up in the another bank then the lender with have to provide cash immediately to the other bank to cover the value of the loan. This means banks generally will not lend money unless they have enough cash to cover it. Even if the borrowed money ends up in the same bank the bank will now have to pay interest on that money they created for the loan.

The net result is banks only make money on the difference between the interest on the loan and the amount they pay in interest. The suggestion that banks make a profit equal to the face value of the loan is unequivocally false.

when a bank makes a loan, using a house as an example, it assumes a liability, but really, it doesn't, as you pay mortgage insurance, first of all, that pays the bank if you default, and also the bank takes your houseif you do default.

So, since the bank holds all the cards, if you don't pay, they really isn't that much liability to assume.

Yes I realize this is oversimplified.

Banks do not have to have "cash" to cover there loans made ,in any physical sense of the word.

[Riverwind]

The bank lends out 1990.00 and that gets deposited in the bank as another asset.

In this example, the bank already has $2100-$300=$1800 in loans outstanding to the bank can only lend an additional $90 (that is what is meant by the term excess reserves).

Your calculations would only make sense if the bank started with $2100 in cash deposits.

when a bank makes a loan, using a house as an example, it assumes a liability, but really, it doesn't, as you pay mortgage insurance, first of all, that pays the bank if you default, and also the bank takes your houseif you do default.

It still is a liability that the bank has and it costs money to pay for insurance and/or repossess a house. More importantly, the bank has to pay interest on the money it loans to the depositors. The net result is banks only make money on the difference between the interest paid to depositors and the rate of the loan.

Banks do not have to have "cash" to cover there loans made ,in any physical sense of the word.

Electronic cash is not the same as electronic money. The bank must have enough cash (electronic or otherwise) to cover the value of the loan. Banks cannot create cash - but they can create money. Only the BOC can create cash.

[kuzadd]

The bank lends out 1990.00 and that gets deposited in the bank as another asset.

In this example, the bank already has $2100-$300=$1800 in loans outstanding to the bank can only lend an additional $90.

Your calculations would only make sense if the bank started with $2100 in cash deposits.

when a bank makes a loan, using a house as an example, it assumes a liability, but really, it doesn't, as you pay mortgage insurance, first of all, that pays the bank if you default, and also the bank takes your houseif you do default.

It still is a liability that the bank has and it costs money to pay for insurance and/or repossess a house. More importantly, the bank has to pay interest on the money it loans to the depositors. The net result is banks only make money on the difference between the interest paid to depositors and the rate of the loan.

The bank doesn't pay the insurance, the purchaser of the home does!

Have you not heard of CMHC, for example?

What is CMHC Mortgage Loan Insurance?

Mortgage loan insurance is typically required by lenders when homebuyers make a downpayment of less than 20% of the purchase price. Mortgage loan insurance helps protects lenders against mortgage default, and enables consumers to purchase homes with little or no downpayment — with interest rates comparable to those with a 20% downpayment.

mortgage loan insurance is paid for by the potential homeowner , to protect the bank!!!

All cost of repossession are born by the insurer,the sale of the home, or the defaulting homeowner.

[Riverwind]

All cost of repossession are born by the insurer,the sale of the home, or the defaulting homeowner.

You are assuming that the home is actually worth more than the value of the loan. You also forget that a lot of debt (i.e. credit cards) is not secured by assets which means the banks to assume complete liability.

[kuzadd]

All cost of repossession are born by the insurer,the sale of the home, or the defaulting homeowner.

You are assuming that the home is actually worth more than the value of the loan. You also forget that a lot of debt (i.e. credit cards) is not secured by assets which means the banks to assume complete liability.

Riverwind, I am only speaking of home's at this time. if the home is not sold for what is owed on it, the insurer or homeowner is on the hook, you don't seem to grasp that the banks hold all the cards, not you or me.

Credit cards are a whole other issue, but ,by and large looking at the massive profitibility of the banks, they are making out "like bandits" so to speak.

[Riverwind]

Riverwind, I am only speaking of home's at this time. if the home is not sold for what is owed on it, the insurer or homeowner is on the hook, you don't seem to grasp that the banks hold all the cards, not you or me.

The bank is still liable for that money even if the homeowner goes bankrupt. Many home loans do not have CHMC coverage which means the bank has no insurance in case of default.

What you cannot seem to grasp is the banks are responsible for all money that they create. And they must pay interest on it even if the money is repaid by the borrower or third party insurance.

Think about it: you borrow $10000 from a bank. You spend that money on a car and the seller puts that money in a bank and collects interest. You get $10000 from your employer who uses another bank and you pay off the loan. The bank now has $10000 in cash which it could re-loan but it still has to pay interest on the money in the car seller's account. That means the bank is now losing money because of the liability the created when they lent you the original $10000.

Now the bank can make money by loaning the car seller's deposit and the cash you repaid but they aren't always able to find a suitable borrower.

IOW: the bank's liability for money that it creates does _not_ go away when the loan is repaid. Once created - the money cannot disappear unless the BOC intervenes.

[kuzadd]

riverwind:

The bank is still liable for that money even if the homeowner goes bankrupt.

bad loans are simply written off, and the buck is passed to you and me.

Many home loans do not have CHMC coverage which means the bank has no insurance in case of default.

Almost all home loans have CMHC coverage or others because it is mandatory, when the purchaser, has a downpayment below a certain percentage of the asking price. Which is how most homes are purchased at this time, very low down payments.

if this is rarely, not the case, the bank takes the home and sells it, and cost that is not gotten back in the sale is again passed to the homeowner.

Again I will reiterate, have you noticed bank profitibality as of late, "livin large"!

This is possible, because there is soooo much credit extended from lenders,(backed by nothing) in which very substantial interest is charged on that credit,( all forms of credit) hence the massive profits. Also ridiculous service fees.