Thread by @TheEndOfMoney

1/ AT ONE TIME, EVERY PIECE OF #PAPER MONEY WAS BACKED BY #GOLD. REMEMBER… FOR EVERY 20 DOLLAR BILL… THERE WAS $20 WORTH OF GOLD IN A #GOVERNMENT VAULT. NOT ANYMORE.

TODAY, GOVERNMENTS CREATE #CURRENCY BY FIRST CREATING BONDS OR TREASURY-BILLS.

2/
THESE #BONDS ARE SOLD IN THE #MARKET… GENERATING FUNDS FOR THE GOVERNMENT THAT ISSUED THEM.

LARGE #BANKS BUY U.S. BONDS TO FLIP THEM… SELLING THEM TO THE #FEDERAL RESERVE AT A PROFIT -- THIS IS THE MAGIC MONEY MACHINE. #FED

3/ YOU SEE… THE FED IS AMERICA’S #CENTRALBANK. BUT IT DOESN’T HAVE ANY MONEY, NO #CASH ON ITS BALANCE SHEETS.

WHEN A BANK BUYS A BOND AND TAKES IT TO THE FEDERAL RESERVE, THE FED SIMPLY SAYS “THANK YOU MR. BANKER, HERE’S THE PRINCIPAL AND SOME #PROFIT.”

4/ NEW MONEY ISN’T EXCHANGED, IT SIMPLY APPEARS ON THE BANK’S ACCOUNTS. MAGIC.

FOR 100 YEARS AND COUNTING, THE PRECISE MECHANISMS OF THESE BOND PURCHASES HAVE REMAINED A SECRET.

HERE’S WHERE IT GETS REALLY INTERESTING. THE FEDERAL RESERVE IS NOT A GOVERNMENT AGENCY.

5/ IT’S A PRIVATE ENTITY…AND ITS SHAREHOLDERS ARE BANKS WHICH EARN A DIVIDEND. AS MUCH AS 80 BILLION DOLLARS PER YEAR--TOTAL-- ARE PAID OUT TO SOME OF THE VERY SAME BANKS THAT SELL THE GOVERNMENT DEBT... TO THE FED.

6/ WHICH BANKS? DON’T EVEN BOTHER ASKING. THAT’S ALSO A SECRET. IN OTHER WORDS… THE MAGIC MONEY MACHINE ANSWERS TO NO ONE.

THE FED ALSO SETS THE BAR FOR HOW MUCH INTEREST YOU PAY FOR A CAR, HOME, OR BUSINESS LOAN.

7/ “The Federal Reserve has been giving the impossible task of trying to run the credit and monetary system as though we are the Soviet Union: It’s the central planner for the key aspect of capitalism which is how money and credit is allocated. … The Federal Reserve, on balance

8/ ..." does not help the economy. On balance, it hurts the economy. And it’s bound to make mistakes even with the best of intentions.” @barronsonline
Gene Epstein, Economics Editor, Barron's Financial Weekly

9/ THE FED IS ALSO SUPPOSED TO BOOST EMPLOYMENT WITH LOW #INTERESTRATES ENCOURAGING PEOPLE AND BUSINESSES TO BUY MORE GOODS AND SERVICES.
@NGruen1
“Governments getting involved in money is a good thing, and it’s also a bad thing. It’s a good thing because money is the arteries

10/ ... "of the economy, the blood #supply of the #economy. #Markets are subject to bouts of euphoria and despair. And it makes sense for Govts to back currency and to manipulate it. Moving the money supply up and down is the most powerful way to sedate that boom and bust cycle.”

11/ Nicholas Gruen, CEO, Lateral Economics

MANIPULATING THE SUPPLY OF MONEY HAS SHORT TERM AND LONG TERM CONSEQUENCES.

CHAPTER: #INFLATION

Albert #Einstein “#CompoundInterest is the eighth wonder of the world. He who understands it, earns it ... he who doesn't ... pays it.”

.... this is the #script from a short sequence about #Government #Money creation from our first #documentary 2014/2015. It seems so relevant today. I just uploaded it here on YouTube: vimeo iTunes
vimeo.com/ondemand/bitco…
#CryptopiaFilm coming soon /end