THE FEDERAL RESERVE : THE CREATION OF A SNAKE
What you are looking at is a picture of an Eastern Diamondback Rattlesnake
or what I would draw if I was asked to draw a picture of
the Chair of the Board of Governors of the Federal Reserve System
The banksters have a bird in the hand and a bird in the bush. They never lose because when they gamble with your deposits at "their" banks they have a bird in the hand. The Federal Reserve System is there to create money out of thin air and lend it to banks at a below market interest rates (a "market rate" being based on what you and I would think would be an appropriate rate for the risk invovled). This allows the banksters to bail themselves out.
Banksters have a bird in the bush because they can lend multiples (usually 10 times) of the amount of any deposits they hold for you at the bank. This is called fractional reserve banking and it means the banks only have a fraction of the reserves that they would have if they were required to keep one dollar in the bank for each dollar they lent out. They usually lend out 7 to 10 times the amount of the deposits that they have on their books. The reason there were bank runs in the old days is that citizens understood this and there were no computers to wire money to banks with a push of a button. The other reason was that money was officially backed by gold or silver before 1973. Not anymore. All you have is a credit memo or piece of worthless paper.
Banksters have a bird in the bush because they can lend multiples (usually 10 times) of the amount of any deposits they hold for you at the bank. This is called fractional reserve banking and it means the banks only have a fraction of the reserves that they would have if they were required to keep one dollar in the bank for each dollar they lent out. They usually lend out 7 to 10 times the amount of the deposits that they have on their books. The reason there were bank runs in the old days is that citizens understood this and there were no computers to wire money to banks with a push of a button. The other reason was that money was officially backed by gold or silver before 1973. Not anymore. All you have is a credit memo or piece of worthless paper.
Tomorrow the Chair of the Board will say some drivel to the public about how the Federal Reserve has everything under control and that markets are normalizing with some disruptions from Russia and oil prices. What they won't say is how their irresponsible financial engineering by creating money out of thin air to buy bonds and mortgages to drive interest rates to near zero steals money from the savings of responsible citizens and veterans and grandmothers and grandfathers who worked their entire life so that they may retire someday. No. You won't hear how the FED bails out the banksters and irresponsible borrowers and pays off the public unions and helps the government spend money on wars and silly projects and political payoffs. You won't hear that.
You won't hear how easy money allowed every Tom, Dick and Harry to get money to drill oil wells in the Permian Basin because banks could finance operations that would never exist in a true free market with a true free market interest rate and with free market returns (as well as free market failures). If you read the financial statements of most of the new drillers, and look at the build up in debt, it would make your head spin. Most were never free cash flow positive even with oil over 100 dollars. Imagine what their finances are like with oil at 50 dollars.
You may not remember the last two train wrecks from the FED's easy money policies. Let me remind you. The first big one was after the year 2000 when Greenspan flooded the market with money because everyone thought the computers were all going to blow up when they turned over to the year 2000. Then came 9/11. The second one was caused by pumping up the real estate market to unsustainable levels up until 2008. The "official" reasons the FED does this are always the same. The FED is saving the markets, saving the banks or monitoring employment levels but the real reason is merely to enrich those who control the money supply. Heavy government regulation makes only the politically connected rich. Free markets allows everyone to get rich (along with the requisite responsibility of managing your own money). Do you want to take a shot at getting elected to get rich or do want to do what you want to get rich and not have it taken from you from the FED's constant inflation of the money supply?
Easy money never ends well. Don't believe the snake when she tells you this time is different.
Easy money never ends well. Don't believe the snake when she tells you this time is different.
No matter what, the FED will be there to bail out the banks (even the ones that lent money to Tom, Dick and Harry). That is why the banksters created the FED in the first place.
I have said it once and said it 100 times. End the FED. We will all be better off.
I have said it once and said it 100 times. End the FED. We will all be better off.
