Federal Reserve Challenge

[ericgibian]

L.E.T.S. (local exchange trading system) is on viable alternative. And of course there's the gold standard, which Peter Schiff points out could be a much more divisible, pliable, practical system today due to electronic banking than it ever was. The big question of course is how dow we get this big FED monkey off our backs??

[2tolerant]

No doubt, the banks siphon off money from the productive sector.

The fed does provide a few useful services such as 1) they protect the dollar from counterfeit due to the watermark and 2) the dollar is accepted almost everywhere.

2) is especially useful. If leagal tender laws are repealed and companies start printing their own money, how does a merchant decide which currencies to accept and at what exchange rates? Does this complicate buying goods from the consumer's perspective?

[RenewalOfAllThings]

Ezekiel 18:13

[trufiend138]

how many time will u repeat urself?

[lorax2013]

@trufiend138 I'll repeat myself until people get it - which means A LOT of repeating : ) Seriously though, it takes a little repetition to overcome the lifetime of conditioning most people have received.

[WarzSchoolchild]

The ideal situation, would be to drop the concept of 'money', and recognise that humanity has been enslaved by Satan's stool long enough! First it was gold that made baubles and trinkets for the womenfolk. Women like to display status symbols, and also have something to trade, if their man is killed on a hunting expedition. The concept of money is stone-age thinking!... this is 2009! it's about time we grew up! and stopped behaving like savages! Good riddence to bad rubbish! KILL MONEY NOW!

[finefilth]

Only a brainwashed automaton could argue against the death of money..We have all the keys and are wasting time and resources with this outdated system of phantom imaginary credit...other, better forms of compensation could be easily figured out

[WarzSchoolchild]

The late Douglas Adams, in "Hitch Hiker's Guide to The Galaxy" put it succinctly, "Money is the product of a deranged mind!"... the expression 'sound money' is an oxymoron. as foolish as saying 'painless torture'. "Better forms of compensation.." WELL SAID! BRAVO!

[finefilth]

thank you, a famous and brilliant scientist once decided to study money, and after 2 years of in depth fact finding he determined it was nothing but a confidence trick...lets dump this con game run by con men

[RenewalOfAllThings]

@WarzSchoolchild

I believe that God is "overpopulating" the earth so that we will learn to throw away the concept of money and learn to live with one another, rather than waiting till we die to live at peace. Imagine a world in which robots and machines don't do the jobs of THOUSANDS of willing and capable HUMAN workers! We will all have roles and organic foods, we will truly learn to love our neighbors as ourselves. Your identity can't be stolen, etc etc. Technology =/= Prosperity.

[WarzSchoolchild]

Great quote from Ezekiel...And the good news is that God's return, and rule, will NOT be doubted by any living person.

[uturniaphobic]

checkout the Ron Paul Dollar ..even Walmart accepts it and it's backed in gold!

thanks for the video, great info!

[KamikazeKoscki]

This family in the USA determines who lives Financially and who dies Financially.

Rothschild Dynasty control the world, it's time one million militia join together with guns and stop congress from all their corruption. Restore the Constitution! I would be willing to die for the cause on the front lines for freedom!

[7514328]

We had Abraham Lincoln and JFK. I am certain they would have succeeded with usurping the money changers who got us into this dilemma to bein with. I want to see this monetary/Banking scam collapse. How can we do that?

[finefilth]

if everyone stopped paying at once... that would be hard to convince people too do.. especially the people who have advantage in the system

[RenewalOfAllThings]

@7514328

All we need for it to collapse is to hold them accountable. Since they have infinite resources tucked away in safe houses and panic rooms, we will need the use of the American military and law enforcement. They must be held accountable to the LAW for their monetary crimes. If we rely on murdering them then we are lawless savages. If, however, we rely on the law then we prove that the law is just and that no one is exempt.  Then we refund the money justly to those it was stolen from

[Atom299]

Yes.. the FED is 100% illegal parasitic cartel. No one can argue against that.

They serve no useful purpose whatsoever. There's NOTHING they do that the treasury couldn't do without charging "interest"(usury).

Their only purpose is to enrich themselves at the expense of the citizens and they are the sole cause of all the US financial ills.

[vme02]

Central banks and fractional reserve banking are the biggest frauds ever put on populations. Actually these banks can only create money by our signatures, it is our credit that creates the fiat money, otherwise, known as debt.

I would have been hell on earth for my economics professor if i knew then what i know now.

[pure2warrior]

The elephant in the corner is the DEBT ISSUE, fake money digitized out of thin air loaned with compounded intrest. Paid thru extorted theft a debt slave control tool

[zahimqubadi]

If there were only 30 million Americans like lorax2013, I have no doubts at all that there would be a rise against the superpowers by tomorrow morning.

[finefilth]

this guy is the man

[emmazedbend]

Excellent explanation, will you be doing any more videos?

[AccuracyMarked]

Interesting stuff.....when I was 13 I helped stimulate the economy and created valueable real money by altering a 1944-D lincoln penny to 1914-D then exchanging it for a roll of silver mercury dimes....it was absurd of me, yes, & illegal......however I am a fan of Jerry Springer's trailer trash girls....they're really HOTTER don't you think? I got to go to bed now....mind lost control....kind of thing

[Lordgout]

Brilliant video dude! I take it you have seen Zeitgiest and Zeitgeist addendum! My friends never seem willing to debate because there is always an excuse that something that they know of (i.e music industry, art) is going to be affected

[brightlightbabe]

good one!!

[PeaceIsRad]

My way of educating others and saying fuck you to the fed, is writing a little message on every dollar that goes thru my hands.

I write things like, Google Money Masters, or Google PNAC, or Google Freedom to Fascism.

Get the word out to the masses!

[llothar68]

Talking on youtube about the FED does not help. Go out to the streets and organize protest.

When i see a million people marsh in lower Manhattan i get some more hope but at the moment you fucked up country is still doped with obama, jerry springer and wal-mart.

Your grandfathers would spit on you.

[Mambu152]

You are correct that it will take huge numbers of people to demand returning to sanity to do any good but it isn't so simple to get the kind of grassroots uprising and revolution you are looking for started. Realistically, just what do you suggest.

[bar730]

Going back to Lincolns "greenbacks" or releasing all of the United States Notes JFK had printed would be a couple options as they were both issued by the U.S. government and kept private bankers out of the loop.(Strange they were both assasinated)

[007bruclee]

Lorax

I think this video is great. THank you so much!!Please go to this link and watch the short but very infomative documentary called Meet the Fed. I'll admit the first 7 minutes might not interest you but after that is the Chicago Feds PR representative answering the questions like , is it true the Fed is private? Is it true they create money with a penstroke? ETC.. A must see if you want to know more about the FED.Here's the link.

(ht tp)://MeetTheFED(dot)com

[MachApocalypse]

Oh my god i think i

JIZZED IN MY PANTS

felt something hot and sticky must have

JIZZED IN MY PANTS

Oh wow it feels so good now

JIZZ IN YOUR PANTS

It's hard to believe all this

JIZZ IN MY PANTS.

[davincij15]

problem is no one believes me when I tell them that banks create the money. It's to unbelievable like the matrix.

[kensho3]

A private community could just use monopoly money. You attach a dollar value to say, a single live chicken, and the "free-market" will determine the dollar value of everything else off of that. A 3rd-grader could understand why the Fed ruins countries.

[c16467]

Thank you for your steady, intelligent voice! I subscribed tonight and look forward to your other videos.

[pjperalta]

Prof. Giacinto Auretti gave solution to arbitrary money creation by Jewish dynasties. Gold being no back up, money is the result of law and should be created by government. Money should be credited to citizens through a social number. Banking interests/ services should be regulated. Money should be a resource available in relation to growth and needs of the people - presently banks create money as per debt interests, above the GNP growth rate, causing inflation/ infamous wealth for bankers.

[blemished2006]

Two US presidents have tried to create interest-free government money, Abe Lincoln and JFK.

[corvettedude346]

Yes, and look what happened to them when they crossed the "banksters". Also Reagan tried to expose the IRS and how all the income tax goes to pay the interest to the "federal reserve" with the Grace Commission in 1984 and the same fate almost took his life. He stopped pushing it after that, our Presidents today are too corrupt to want to stop it and even if they did they wouldn't have the balls :(

[kensho3]

I was wondering why "they" shot Reagan. very enlightening.

[arkadyka]

You sir, know what you are talking about.

Very nice.

[DividedLove]

Lorax2013 what do you think of: FREEDOM TO FASCISM, MONEY MASTERS, MONEY AS DEBT, RING OF POWER, ENDGAME, 911 MYSTERIES, ZEITGEIST, ESOTERIC AGENDA, MIND OVER MATTER? THANKS! -ONELOVE

[mindprism]

At root, its a voluntary system. They aren't counterfeiting anything at all technically.

Come over my house we'll play some monopoly.

You use the currency of Americas *enemy domestica* and now you want me to feel sowwy for you?

It is the currency user who wants to NOT PAY that which he owes (see inflation, defaults, bankruptcy protections, stock ownership liability protection).

Sinners all!

THAT is the correct decomposition of this madness.

[corvettedude346]

So what is our alternative in the current system, barter? If we try to trade privately minted silver rounds they would arrest US for counterfeiting even though they are the counterfeiters (The Constitution states only gold and silver shall be money). Let's ABOLISH the "federal" reserve!!!! Even though America does not own enough gold or silver to back all the money the government could at least print it themselves DEBT FREE and there would be no need for income tax!!!

[faszika]

=o this is infuriating :( so should i buy a shotgun and shoot my bank manager?

[corvettedude346]

No, most local bankers are pawns in the game and few even truly understand the big picture. I am not advising you shoot anyone, BUT if you were going to shoot someone make it a top dog "federal" reserve banker :)

[sageit4me]

lorax2013 is my favorite channel. you present the important facts about important topics without the CT clutter. watch "washington you're fired" and run for office. get your ideas into the mainstream via a political campaign.

[jasonmhc]

i agree with your vid! the federal reserve is a criminal organisation set up partially by the wanker who denied us free energy (zero point) J.P.MORGAN the finacial luminary. nickola tesla wanted to create free energy for humanity and when jp morgan found out about his plans he withdrew all funding to tesla(one of the unsung genius's of the last century) we have been uneccasarily poisoning our planet for no other reason than the bankers.

[actop19]

Keep speaking the truth!

[DeluxeGoldTop]

Problems with video:

1. A bank creating funds for a loan is not the same as counterfeiting.

2. Banks and Federal Reserve do not create paper money.

3. The capital that banks create for loans are created "out of thin air" when issued but VANISHES from the books when paid back. Thus, it would no longer exist... no inflationary effect once paid off.

[NoobTube2010]

My comment on 3.)

3.) Let's say I have the magical power to create gold on demand, with the limitation that the gold will only exist in reality for a fixed period of time. There is no limitation on how much gold I can create. The fact that the gold disintegrates to nothing after a period doesn't really matter because everyone know I will just make more when it is convenient. I now control the current value of gold as I control the current production...

[DeluxeGoldTop]

Well, you pretty much said the problem with a gold standard. The commodity is limited.

Going back to a gold standard would take us back in time when the poor and middleclass had no means of obtaining a house, car, or business without loan. It would be the nail in the coffin for our economy.

Try demonstrating how fractional reserve banking is bad for the economy. Also, demonstrate how the banks create money "when it is convenient".

[isisarchist]

"when the poor and middleclass had no means of obtaining a house, car or business"

The most obvious problem with the above quote is the inclusion of poor people with middle class.

Middle class people have steady, permanent income and savings. Poor people DON'T have any.

The federal reserve did not make it possible for the middle class people to obtain loans, they have been able to get them throughout history because it is a safe investment for wealthier citizens to invest GOLD into.

[sabiki74]

"If the American people ever allow the banks to control the issuance of their currency... the banks and corporations that will grow up around them will deprive the people of all property, until their children wake up homeless on the continent their fathers conquered." -Thomas Jefferson

[DeluxeGoldTop]

I agree.

However, the banks do not issue/print money. Banks loan temporary money to people that have collateral, then the money disappears from books as it's paid bank.

The FED also does not issue/print money, nor does it loan the government money. The FED buys government securities at auction and returns 85-95% of the interest made on those securities annually back to department of treasury. Regular people can purchase these securities (government bonds) as well.

[lorax2013]

Hi DeluxGoldTop,

Insightful points. Yes, the money created by fractional reserve banking is eventually "extinguished" - as noted, it makes little difference. It clearly does create inflation - no one else besides the banks and Fed Res are legally counterfeiting therefore almost all inflation is due to fract res banking. There are other options to gld std. You could simply have a transparent fiat currency and if people wanted it to inflate the govt could counterfeit more instead of taxing.

[lorax2013]

DeluxGoldTop,

2nd half of reply: You also note that this system stimulates loans(helps the poor get homes). I partially agree, but it does this by stealing value from everyone. If you feel these easy loans are needed, why allow the banks to keep the benefit? Why not allow anyone with a minimum credit score and down payment to create their own money, pay themselves the interest, and extinguish the principal later? Alternately, why not let the govt create/loan the money and keep the interest?

[DeluxeGoldTop]

I don't agree that it is stealing value from everyone, but banks definitely profit of the recipient of the loan. Why? Because banks are a for-profit business, that's how they make money. If it wasn't worth the interest, then people wouldn't do business.

Why not allow people to create their own money? Currency would lose all value completely, impossible to regulate.

Why not let the govt create/loan money? Because it can't be trusted. It would no longer need collateral to acquire new $.

[DeluxeGoldTop]

The Federal Reserve banks have only a small share of the total national debt (about 7%). Therefore, only a small share of the interest on the debt goes to the Fed. Regardless, the Fed rebates that interest to the Treasury every year, so the debt held by the Fed carries no net interest obligation for the government. In addition, it is Congress, not the Federal Reserve, who is responsible for the federal budget and the national debt.

[lorax2013]

Agree about Fed Res interest. However, IMO, people could be allowed to create money subject to the same restrictions as current. Therefore no more $ would be made than current. Actually easier to regulate because no banker with a conflict of interest between the regulators and the borrower. I'm not saying it would be ideal, but better than the current situation where banks are given a monopoly on theft. My first choice is sound money - it never stopped expansion/opportunity/loans in the past.

[DeluxeGoldTop]

It would be better for people to create their own money? That sounds like it would be more susceptible to fraud and misregulation.

Banks are a service industry. They create temporary money by collateralizing something of equal or more value to issue a loan, that created money vanishes from the books when paid. It is the job creation engine of the world.

In order to provide services, banks must profit. They do this by offering competitive interest rates on loans. Whats wrong with profit?

[lorax2013]

Totally agree letting anyone create $ is a formula for fraud beyond the original inflationary theft itself. I think people begin to see both the potential for fraud as well as the absurd/inflationary nature of creating money when you substitute "individual" for "bank".

Also agree it is a "job creation engine" - but in the same sense feudalism was.

Agree profit is good - but if I want to profit I can't create 10x my capital and then get a taxpayer bailout if my investment/loan goes bad.

[DeluxeGoldTop]

Yes, banks have the power to create 9-10x their capital for new loans. And when a loan goes bad, banks turn to the taxpayers for a bailout. That is the problem with socialized systems.

But that is something to be blame on government policy again. In the past, banks were very strict about who they loaned money to. They analyzed their customers financial situation to make sure they could afford the loan.

Government policy took away these risks for the banks, and put the burden on taxpayers.

[DeluxeGoldTop]

The government removed the caps on banking/credit card interests. Credit cards now charge outrageous interest rates, and issue credit to almost anyone who applies. Banks offer more competitive rates for loans, but have more power to take advantage of the financially-challenge with options like: neg am, ARMS, no money down kinda loans.

My argument is that government policy should be in place to restrict banks and credit card companies to practical interest rates and responsible loaning.

[fredstopp]

I really like your videos. Thanks for making them.

[DeluxeGoldTop]

Also, this "free" money is hardly free at all. When you go for a loan, one of the main requirements you need to meet is collateral.

Collateral is basically insurance for the bank that the initial loan will be paid back in full plus interest.

This means the bank can use the loan as collateral to generate new loans for new customers.

One thing u should mention, is that this money "created out of thin air" also VANISHES from the books when the loan is paid back. Interest is bank profit.

[MillionthUsername]

Taking cash out of banks and buying assets and/or gold and silver coins would take power away from banks. Their reserves would plunge.

Ultimately, any system relies on confidence - and if that confidence is withdrawn en masse then it should die.

Seems to me that creating an efficient exchange system is not too difficult, BUT gov't systems have the advantage of implementing things by force instantaneously and so it's hard to compete. Plus they have guys with badges and guns who follow orders.

[LucyVanPelt22]

just print!!!

US dollar is backed by oil, dont worry!!!!

Iran will not spoil our plans!!!

Cause we are able to bomb them

Just make sure that the media can convince people that the iranians got nuclear bombs!!!

Just like what mccain siad, bomb bomb bomb!!!

[glendouglas2]

people this is a MORON!

now you know what a MORON IS!

its not how he look its want he says!

this is how you help a MORON!

you buy him BOOKS LOT's of BOOKS

then you pray to God so that he reads them

then one day he will think befor he talks

[DividedLove]

glendouglas2: First lets start with learning how to spell and form proper sentences, then you obviously have a long way to go. So please SHUT UP! IF YOU WANT TO KNOW THE TRUTH THAT THE COUNCIL OF FOREIGN RELATIONS (MAINSTREAM MEDIA) DOES NOT WANT YOU TO KNOW THEN PLEASE WATCH: FREEDOM TO FASCISM, 911 MYSTERIES, MONEY MASTERS, MONEY AS DEBT, RING OF POWER, ENDGAME, ZEITGEIST, ESOTERIC AGENDA...

-ONELOVE

[voicefromthegrave]

Yes, every parasitic system collapses... but is always replaced by yet another parasitic system because human nature remains constant. While every revolutionary cause starts out as noble, once they finally achieve in ending the status quo, they are once again intoxicated by the corrupting influence of power. Until humanity can be overruled by an artificial power structure based on non-negotiable rules (not biased to favor any person or group), this act will continue to play out ad infinitum.

[jayrp]

Hey Lorax, my favorite thinker on youtube! Watch the great Jim Rogers: he's already predicted that the Federal Reserve will go away. All corrupt systems will fail because they are not sustainable. All pyramid schemes eventually fail. My hope is that the new systems are sound instead of another corrupt system. But that fate rests on the human heart and whether that stays corrupt or not, and that includes you, me and everyone like us.

[BrightAnarchist]

Man, great video. I believe that the Fed will no longer exist within a couple decades. I am not expert, but a lot of people who study monetary history and cycles believe that the world will have to go back to hard money in this cycle. I guess we'll see.

[rseveran]

The Fed is in extreme peril if the masses do awaken because of this debacle.  It's a turning point in central bank history.

You're right, it is part of a cycle. History just keeps repeating itself. We're coming up to revolution time in my view.

[utubehayter]

When Cash disappears people think they have been cheated! Well.. they have, but long time before they found out - when they participated in a fractional reserve system. If they were on a gold standard, the cash could be in shortage, but all money that people are owed could be repaid to them in gold or which ever commodity it was based on. (It could be oil or any consumable goods too. Doesn't have to be gold).

Question is - why did people think their bank balance can be withdrawn in full?

[itsjack360]

Loren's a good guy trying to help people realize the parasitic nature of our economy. Don't try to compare his point and thought process on money and economics with your racists drivel. Crawl back into your cave.

[j25ack]

What?? When you sell a house you are paid in cash at the closing this money is not "produced out of thin air" It is $ that the members have deposited with the bank. They pay interest on the balances and charge higher interest on loans. All part of a crazy scheme they thought of to make money

If they could as you say "produce their on money" then Indy Mac would not have gone under. Only the FED can print new money and they are good at it It is called inflation, increasing the money supply

[utubehayter]

Lets walk through this- so your bank pays money on your behalf - as a loan to you - to the home builder/seller. What does he/she/they do with that money? Put it in a bank? maybe? They go buy more land and raw materials - the sellers of which will again put it in the bank OR the sellers that sell them stuff will put that money in the bank..

Eventually it ends up back into the banks. Net result - a lot of goods have traded hands, but the money ended up from where it started ... (continued)

[utubehayter]

and then you owe interest and so does everyone who has borrowed from the bank. The more borrowers borrow, the more the bank makes profit. So, what happens when the bank has already dished out all the money it has in deposits? Well, since its going to comeback anyway, they - get this - borrow from the Fed Reserve - and lend it out!

Problem comes when people decide they actually want to empty their bank accounts. This is when the flaw is detected and out in the open. Money (Cash) disappears!

[lorax2013]

Hi j25ack, under fractional reserve banking, the bank does actually produce/counterfeit money out of nothing. In practice, the individual banks counterfeit far more money than the Fed Res. The common perception is that banks re-lend only deposit money, but that is not the case. The reality of how the system works is so audacious that "the mind is repelled" and people assume it operates fairly with banks only lending their deposits. As for why banks can still go broke watch my inflation/defl vid.

[Azandex]

2. Start a savings plan with REAL money like silver or gold now and include your friends. Anyone can muster together 20 dollars per pay check to start a savings. As soon as they start seeing their savings grow they will naturally devote more cash to their savings. It works.

[Azandex]

Another great vid Mr. Lorax2013.

I did take your challenge and it is truly a challenge. Most friends and family are very defensive when it comes to their money so, here are some things that could help those who run into the same problems as i did.

1. Refer them to this channel and have them watch 'The real story of money' they will naturally branch out and start doing some investigating them self's and in time become comfortable with the truth.

[davidcononie]

sound money sounds good, you get a loan from a fed entity, and pay it back with real sweat and labor, paying something tangable for something that was created out of thin air, and meanwhile, the money value decreased, the fed needs closed, before we end up with crazy inflation

[JackNeedles]

Great video. Wise man.

[AtrumVerum]

couldnt explained it better than that

[AkoyPinoy2]

Are you a Ron Paul supporter? You should speak at the Minnesotta Rally.

[rseveran]

Yes, Loren has mentioned that he is a Ron Paul supporter.

Great video, once again. Abolish the Fed, get sound money, have *stable* prosperity. Imagine that.

[DeluxeGoldTop]

So what is your alternative, lorax?

The federal reserve is not the problem. It is a major reason why people can start their own businesses, and buy a house that once only the rich could do.

The problem has to do with government corruption. Because of Reagan, we went from a tax and spend government to a borrow and spend government. Pretty much gutting our childrens futures in exchange for all we want now.

I like your videos, but you are wrong on the fed. Sorry

[rseveran]

Watch Money Masters on google video. Then Money as Debt.

The Fed is not some altruistic organization.

[lorax2013]

Getting back on sound currency doesn't exclude people from borrowing or issuing stock to start a company. I agree though that loose money policy stimulates loans (basically by stealing value from wage earners and savers). As mentioned in the vid, rather than get into that discusson, I'll accept your premise that loose money is "needed" - in that case why not let anyone who meets the loan requirements be issued this free money from the government rather than a bank which then keeps the interest?

[DeluxeGoldTop]

This isn't "free" money, it isn't created out of "thin air". It is BORROWED from the Federal Reserve by the government and banks. This money has to be repaid, but the government has accumulated such a debt that it is unpayable.

The government should have only been spending tax dollars not borrowed dollars. But we shifted to a borrow and spend policy during Reagan.

The Federal Reserve is not the problem. The problem is government mismanagement. Borrowed dollars for war and weapons, etc.

[lorax2013]

The vast majority of the money is created/counterfeited by banks using fractional reserve banking rules. The Fed's loans to the govt are in effect interest free and basically constitute a smaller inflation tax on the people. It is a purposefully complex system - if you are interested to learn more of the details, which are hard to cover in a video, you can check out my book.

[DeluxeGoldTop]

I'm assuming that you are all for a system that is fixed to a commodity such as gold in favor of fractional reserve banking. In such a system you would have drastic deflation and inflation in response to the fluctuation of the value of gold. A system like that would be easily manipulated.

I read your book, and I liked it. But you are wrong about the FED. Most of what you blame on the FED are stemmed from deliberate government policy many from Reagan era and on.

[rseveran]

Evidently you don't believe the book? The Fed helps the gov't get bigger through interest free loans, since the Fed gives the gov't the interest back. The gov't can print money at will, and the Fed makes it possible. Otherwise they would have to tax the citizens heavily, which is unpalatable to most. The Fed is a crucial part of the government mismanagement/waste problem that you discuss.

I think you are simply refusing to even entertain the possibility that the Fed is not out to help.

[DeluxeGoldTop]

rseveran, this policy you are talking about is only 20-some years old. It dates back to the Reagan era. GOVERNMENT olicy was deliberately put in place so that the GOVERNMENT could BORROW from the FED to spend instead of TAX and SPEND.

They took a great financial tool like the Federal Reserve and used it to make the rich richer.

I argue that the FED is useful to the economy, but government policy must be reversed. The people are paying for the government's "bad loans" for war.

[rseveran]

I find that one major (there are a few, IMO) "point of inflection" was not the Reagan era as you propose, but Nixon in 1971, when he closed the gold window. Yes, the debt exploded under Reagan, but the ability to take that action was created in 1971.

Since 1971, they could print as much money as they wanted, since the dollar was no longer backed by any sort of gold standard.

How is the Fed a great financial tool? They create booms & busts in the economy by manipulating the money supply.

[DeluxeGoldTop]

Actually since 1933 the dollar was no longer backed by gold.

Having a gold standard would actually have more drastic fluctuations in value because the limited amount of gold is mostly owned by a small portion of people known as "the rich".

The FED is a great financial tool because it offers fractional-reserve banking. That allows the banks to issue loans of temporary created money that vanishes once paid back. Poor and middle class can use it to purchase homes, car, and start businesses.

[rseveran]

Yes, 1933 was another "inflection point." 1971 was in fact the official death knell of the gold standard, until then foreign nations could redeem $'s for gold.

If the poor and middle class benefit from the system as you propose, who loses?

(BTW, since the poor and middle class are paying interest on money that never existed, I find it difficult to believe they are the greatest beneficiary. Also, the *inflation* from the fractional reserve system hurts the poor the most.)

[DeluxeGoldTop]

My point is this: Fractional reserve banking is a usable idea, it worked in the past. The government policy during the reagan era was deliberately past to scheme the system that benefitted the rich.

Destroying the entire system and go back into the past is not progress, progress is better regulation...policy that protects the peoples interest against government corruption.

America is trillions of dollars in debt. Mostly from government borrowing for war that our reps in gov voted for.

[sabiki74]

Sorry, I was just confused by the top of my money where it says "Federal Reserve Note".

[jdcremin]

Interesting viewpoint as usual. So what's going on with oil and gold falling last week? I really wish I understood how oil is priced. Was the fall in oil not related to the futures market?

[reversekenny]

The fall back was after an accelerated runup triggered by short covering of a large hedgefund (that went bankrupt). I.e. first oil went up, then it artificially skyrocketed, now that has been corrected. From here on, oil can continue its "normal" way up.

[jdcremin]

Short covering - So the hedge fund had shorted oil and the covering of that short caused the oil price to rise? Is that basically it? Same for gold maybe? I guess covering a short basically means buying the stock/commodity.

[reversekenny]

Yep. It was underreported in the media but its position was huge: 100 mln barrels. But ... that barely represents more than a day of world demand.

In gold (and especially silver) the situation is far more extreme. But no forced short covering has occurred yet. Perhaps because (though shady middlemen) it is government(s) themselves who are short, manipulating the price on purpose as they know PM's success is widely regarded as an indicator of their own failure. Wait until that becomes untenable!

[earthbowl]

Most people i've spoken too are incredulous,( "deer in headlights" is a perfect description of the look on their face) The assumption is federal Reserve Bank means 'run by the the USgovernment'.

Thanks for video.

[ioniancat]

This collapse will be good for it will destroy the credit market since most who are currently using credit will fall with it. After that, who wil they then loan money to?

[leninstreet]

Do not believe that individuals can be trusted with the creation of money. What is needed is a regulatory framework(agreement) that enforces all parties involved in the creation and use of money to work for the greater good of the local as well as global community. Realistically however the parasite must injure the host significantly before any action can be taken.

[lorax2013]

Leninstreet: I agree that no one should be able to counterfeit. I just meant to use that as an argument for the people who believe creating and loaning money is necessary for the economy. As long as banks can do it, why not let everyone else do the same?

[ElementAbstract]

Your videos are always refreshing.

[ROFLpwnedvideos]

I've explained it to my friend, and he agreed that it is ridiculous.

This should be interesting to bring up in my Principles of Macroeconomics class.

[Simpateeko]

Everyone I have talked to about the subject has been completely ignorant. My brother in law who works for a bank, got really agitated with me when I brought up the subject of the monetary system. My mother looked at me like a deer caught in headlights when I told her our money was not backed by gold in Fort Knox. I told her I was going to put money in PMs and she said I should go up to the bank "they sell gold there".

[MrFredGSanford]

Glad to see you back! :-)