Damn, all this time I thought banks had to hold 90% in reserves and this video says 10% in reserves? That's insane! No wonder they're at risk for bank runs LOL
I hope someone can answer this question! If all money is loaned into existence, how can the gov inflate away the debt? It can only create money by issuing new debt, therefor doubling the money supply to devalue debt can't work, because it had to take a loan equivalent to the existing money supply to inflate the original debt away, but it now owes twice as much
ok get it, Goverment has an outstanding debt for the next year, and it needs money to pay back. So the most probable scenario is borrowing money again, issuing more bonds, just in case goverment does not have money. But what happens if a responsible goverment saves and has surplus of money rather than a deficit, then they wouldn´t need print bonds to face its problems. No money creation from the government. Of course companies also issue debt and banks too, so that´s tricky isnt???
Well, nice video. But, I disagree a bit on your statement that 'it is an exponential system by its very design'. That's because when the 'demand' in the economy is low, the total amount of money in the system will reduce as the banks wouldn't find enough customers (who would loan new money into existence), and hence they will return the money to the Fed and close their debt position.
@abhisheksuraj well abhishek how do u expect a decrease in demand by continues growing world population ... the increasing population will always put a stress on demand in one way or the other
@amanvds Well, that`s a wrong comparison. We are talking of 'loan money' and not 'food', whose demand will increase with the increasing population. Anyway, here are my two points on why demand will decrease - as the risk increases (home prices falling, banks crashing) and interest rates increase (money is costlier) demand for loans will come down. The reason why there is such a huge 'debt mountain' in the world, is that the interest rates were dirty low for a very long time - which is wrong.
The exponential growth that is claimed to be unstainable. Is that really the case? Why can't gradual inflation simply counter this? I am unconvinced that this system, although bad for many reasons, cannot be sustained indefinitely without perpetual economic expansion. This end deserves more scrutiny than just a globe sitting on a graph.
But the Fed could pay printed dollars for T-bills and simply forgive that debt. The Fed would not be "out money" because it simply paid for the T-bills with nothing.
The Fed prints money. It is only tied to debt because of the nature of the system. There is no requirement for the handling of fiat currency that demands a bond exchange system.
I feel the exact same way Chris! If you think of the thousands of years humans have been around, and to witness a catastrophic event in your lifetime, that is truly a lucky opportunity. Thus whatever does happen is not perceived as necessarily negative, but enlightening and understanding.
This video is rather misleading. Money isn't lent into existence by the fed, it's spent into existence by the government, subtle difference. Without an expansion of the money supply, the economy couldn't grow. Your income is someone else's spending, so without an expanding money supply, it'd be impossible for the private sector to accumulate dollars.
@hrmIwonder The fed creates money out of thin air, there is no counter-argument against that. You can't just argue that this video is misleading, because it is telling the truth that many people don't want to be known.
@T0B0KKE No, this video is wrong, Our money is not backed by debt. Our money is by definition a govt liability(since it cancels your liability with the govt), ie debt. Private sector savings IS government debt. Your income is someone else's spending, whose income was someone else's spending, so in order for the private sector as a whole to accumulate dollars, the gvt must deficit spend. To 'pay back the debt' would mean sucking all money out of the economy. Its illogical.
@hrmIwonder If all debts would be payed off today, tomorrow there wouldn't a single dollar in circulation, right? You might be right on that regard, but the fed and the fractional reserve banking system are systems of money creation without any liability for them. It's essentially thin air money. When the US gone into wars, they printed money far beyond gold reserve levels to fund their war efforts. That's fiat money. Money without value for itself unless some kind of law states that it has...
@T0B0KKE we've been fiat since 1971. Your money is by definition a govt liability, since it will cancel out your liability with the govt (the liabilities cancel). What gives money "its value", is the ability of a govt to enforce a tax of some sort in that currency, so you have to get the currency in order to pay the tax. See wikipedia's page for hut tax.
@hrmIwonder The hut tax was used in colonial Africa, not now. What we could call a tax is inflaction. The loss of money value is like and hidden tax on savers. Again there is currently nothing giving fed money value, unless the gov says it has! And yes I know we've been fiat since 1971. Chris and his videos/books have been the best explanation so far about how modern money works. If it is spent or loaned into existence, it doesn't really matter, does it?
@T0B0KKE Yes it matters, if you take a loan from a bank, you have to pay it back, this means no new net financial assets in the private sector. Government spends it doesn't expect to be paid back, otherwise this would suck all money out of the system. The tax view is correct, there's been cases where a king's decree wasn't enough to make the currency accepted, you have to impose a liability on the people, so they need the currency to pay the tax. Taxes are not inflationary, they take money out.
@hrmIwonder Banks do pay interests back to the fed. Printed fed money is payed back with interests! Yes, it does! And liabilities doesn't cancel. If entity X owes 1$ to Y, Y owes 1$ to Z, and Z owes 1$ to X again, their mutual debts aren't cancelled even thought it would seem logical to. When goverment spends money either it came from taxes, exportation (if the external deficit is bellow 0%), selling treasury bonds in financial markets or loaning fed money. IT IS LOANED into existence.NOT SPENT!
@T0B0KKE Money isn't backed by debt, it IS debt. The money in your wallet is your asset, & on the other side of the balance sheet, it's the govt's liability, ie private sector savings is govt debt. By definition. There's no 'paying back' the govt debt. Just imagine if govt ran a surplus for too many years, there'd be no money left in the private sector (the govt 'debt' would be 0 and private sector savings would be 0), currency issuer vs. users. they're opposite sides of the balance sheet.
@T0B0KKE that is an awesome observation. So to increase the money supply, why doesn't the Fed just arrange investment circles like this? Perhaps they do.
@DCUPtoejuice They don't. That's because debt is always greater than money in circulation. It's the old example of 100 people on an island with 10 shells each. They find out that 10 shells isn't enough to buy stuff, so they start to borrow 1 shell and in return pay 2. At the end of the year in the island reunion they count the debt and find out that every single person owes 20 shells and the total debt is 2000 shells, way above the total shell supply of 1000...
@DCUPtoejuice They don't. That's because debt is always greater than money in circulation. It's the old example of 100 people on an island with 10 shells each. They find out that 10 shells isn't enough to buy stuff, so they start to borrow 1 shell and in return pay 2. At the end of the year in the island reunion they count the debt and find out that every single person owes 20 shells and the total debt is 2000 shells, way above the total shell supply of 1000...
@DCUPtoejuice They don't. That's because debt is always greater than money in circulation. It's the old example of 100 people on an island with 10 shells each. They find out that 10 shells isn't enough to buy stuff, so they start to borrow 1 shell and in return pay 2. At the end of the year in the island reunion they count the debt and find out that every single person owes 20 shells and the total debt is 2000 shells, way above the total shell supply of 1000...
If the Fed buys back bonds with money created out of thin air, then why is the US government currently in risk of having to default on their loans? I thought this was due to the fact that it is the actual government that has to buy back bonds and pay interest.
@Tarmbosse the Fed is not part of the US Government. It is a private institution. The US is "in risk of defaulting" (that's not going to happen anyway) because of the high debt it helds and the need to issue more and more bonds to pay back the bonds that are due.
A biggest public campaign has started to end fractional reserve banking, look at the POSITIVE MONEY website and support the campaign ...and spread the word.
I'm not sure the Fed's Fractional Reserve System is a scam. Abraham Lincoln and other prominent peeps wanted the government to create money directly without the Fed, but do you trust the government to create money judiciously? Hmmm, what are you doing now Obama (sadly the check in the system, the Fed, is not stopping his $100 billion / month GFC "fix").
Just ask the bank via a letter to provide you with actual accounting (an invoice will do) as to where they substantiated a loss and had a risk in the investment. Also, to provide a copy of the contract binding both parties, not just you (How could a corporation sign? It can't. What you have is a unilateral contract, not a bilateral one.) Lastly, ask them to show where they provided you with full disclosure by telling you that the "money" in question adds to inflation.Wait28days.Senddefaultnotice
So the Treasury always sells Bonds to 'Big Banks' and never to the Federal Reserve directly or does that happen as well? I'm confused as to why the Federal Reserve would want to make money out of thin air to buy bonds that where bought by 'Big Banks' from the Treasury instead of just buying bonds, with money made from nothing, from the Treasury directly?
@AveiMil Because the Treasury does not have the authority to print money. They have to "sell" the bonds to the Fed so they can authorize the Mint to print the money. The Fed took the authority to print money from the Treasury back in 1913.
The treasury is refunded the interest. The Fed is not a private bank. It's stocks act as bonds and all profits except 6 & are turned over to the govt. This guy leaves a lot out that is important.
Thanks for the video its very educational and I agree, that some people in the money creation system are actualy paid for nothing...But the FED is needed to regulate the economy, as they doing it now, by the rules and responsibility. Some people think, they want to destroy all humanzzz !!! and such... well they actualy need people and they need them to be whealthy, so they can make even more money. I want to save the world and I want peace, thats why I use condom, dont make kids theyr the debt:)
@LitongX1 you sound crazy US was doin find before 1913 when the fed became. i have been feelin some kind of way for years. It wasn't untill a friend told me about a few movies on the system, and after you watch them tell the same thing i think not.
@MrBlackBuds Well even more crazy for me is that gold have bigger value than food... I cannot eat gold or silver I have no use for living from it.... I mean some things are how they are. Ok the dollar is no longer covered by gold BUT can be exchanged with other countries currency you actualy buy "something" from or in other country for a "piece of paper" right ? With this you are now not alone in trouble, not because of the central banks, but for example now the dollar is falling against euro.
@MrBlackBuds and maybe some people think how cool is that, but the export to US will also fall and there are few countries, which are not very happy with that for example - China. So some instruments will start to work against this fall the machine is perfect, but I agree some thinks need to be fixed, because its very flustrating and not fun at all.
@MacabreManifesto Not when we live in a country that will let you go bankrupt but it will protect the Achilles heel by bailing out your debt...... isn't our government nice
@MacabreManifesto Ain't that the truth. You know big Corporations like GE etc don't pay taxes but like just a couple days ago Obama said he is going to raise taxes on small businesses. WTF?
Well done. An abundance of penetrative critical analyses concerning the Fed's transgressions and fraudulent activities are available in this medium, but too few among these are enriched by your positivity and wholly comprehensible presentation.
Pt 5bBy your own admission a hockey stick can made as long as you adjust it. The hockey stick only really applies when there is limits.Thus the Exponential "Controlled" money supply growth is limitless and as the population efficiency and total output is limitless a problem does not exist. Again In emphasize Controlled money supply Growth to reflect the equivalent production output. Let's not forget we just had a surplus a few years back. No reason why we cannot return to that type of prosperity
@Minethis1 Then you do not understand exponential concepts. Yes the hockey stick can be adjusted but the rate of growth cannot. The whole point of the exponential is that it tends to run away with a rate of change that is too fast to deal with. History is full of examples of this. The world's financial systems cannot sustain current required growth because the rate of growth of debt is now too high.
@Huttate1 I understand expo very well ty. Living on water or under it. Finding new planets, Catastrophic War disease etc. Do not limit your thoughts. The world financial system is based off of cash savings. China for the most part has been supply the world with cash savings which is supporting the Debt. Since 2001 Every 40 months they double their total currency.(crazy exponential growth). This is causing low rates. Low rates = High debt High rates = Low Debt Rate can be adjusted that is a Fact
Part 3 You are rewarded for producing less. How is that prosperity? This is why modern economics is based on Growth. Further more if inflation is controlled there is no reason why you cannot invest with limited risk in safe inflationary instruments. Unless of course one doesn't care about their money to begin with. In that case it is a personal choice that one makes.
Chris As you said in part 5 Money is a claim on human labor both present and future output. Thus all Money that is loaned into existence is based on future population growth increased efficiency and output. So to say that money is created out of thin air is a false statement. This is not to say that printing can go on continuously forever at a rate that exceeds output growth. In fact if there is not enough money in circulation it is actually deflationary! Like Gold which is limited as you said.
@Minethis1 Part 2 A limited amount of money supply like Gold Cannot accurately measure the unlimited production output. ie. exponential growth in population labor and efficiency. if there is a total of 10 GOLD pieces and total population of 10 producing 10 units The total output is1 gold piece per person per unit. As the population grows to 20 and the output also doubles the VALUE per person decreased by 50% to .5 pieces of gold per person per unit. This is clearly deflationary and negetive.
Thank you very much for posting this video. In 5 minutes you have taught me more than both of my economic professors have in regards to the Federal Reserve. This is not sarcasm, this is fact.
Thank you very much for posting this video. In 5 minutes you have taught me more than both of economic professors in regards to the Federal Reserve. This is not sarcasm, this is fact.
The Zeitgeist Movement (TZM) brought up some Real and Tangible Solutions to ACTUALLY SOLVE OUR ECONOMICAL, SOCIAL & ECOLOGICAL CRISIS - to know more about it, watch: "Awakening - Multilang - 1/4" (short video) and "Zeitgeist Addendum". Both of them are on YouTube. The SOLUTIONS presented in both videos are already being applied and they have already been proved to work in the short and long run. It's about time to expand/spread it World Wide.
I agree about getting swindled on purchasing power as long as people dont loose sight of other factors. Tell mr johnson greeting you at walmart who lost his house after the factory relocated to China while the CEO tripled his revenues that his loss in purchasing power is all due to "inflation" (or that the 50s middle class was worst off than dickensian 20s workers because coke was a dime more)
I can only hope that enough people will wake up to this fraudulent money system before its to late. Continuous growth is just not realistic on a finite planet. If we want more growth then we have to invest heavily in space travel so that we can populate other planets and eventually other solar systems. This simply won't be possible in a monetary system at its current state. For humanity to survive we have to move past this concept of consumerism and focus completely on sustainability.
why does the goverment have to loan money at the treasury? why can't the goverment print the money itself? Why does the goverment loan the money with intrest? Is the treasury a private insitute? It has to be right?
@colloredbrothers A few of our founding fathers originally wanted the government to loan money itself. It would have been a much better route to go but equally politicians aren't much better at managing money. The government doesn't loan the money with interest, the banks do. The government pays interest on the loan from the Federal Reserve. The US Treasury is a government institute but the Fed is a private institute. it prints money out of thin air and loans it to the gov with interest.
since the Rothchilds own all the money and they control it in the Stock markets buying low selling after everyone is frightened into selling also...then buying up everything at the low price.
@TheBigdick888 you're a loser and its scum like you that are making things worst than they should be. May you become homeless,and have creditors hound you for the rest of your worthless life.
The time has come for Free energy to be revealed ,But the Oil companies want these technologies unknown to the masses,Find the real deal, a free energy device at LT-MAGNET-MOTORdotCOM ,Be part of the revolution!
It was my understanding that the Federal Reserve not only purchases treasury bonds from banks, but that it also purchases treasury bonds on the open market directly from the treasury as the banks do. Is that not correct?
you missed one point about servicing the debit interest. Bank profits to employee's from credit interest and earned from savings also goes into the economy which essentially pays the debit interest.
Ok, but what does the fed do with the bonds? You said that the Fed exchanges newly created cash for the bond--which it exchages with the banks. What does the Fed do with the bonds? Do it destroy them? Or do the banks have to pay for the bonds later? And if they do and don't pay, what happens to the Fed and the bonds? Does the fed have to destroy its own real reserves to make up for the excess in the sytem?
Ok, but what does the fed do with the bonds? You said that the Fed exchanges newly created cash for the bond--which it exchages with the banks. What does the Fed do with the bonds? Do it destroy them? Or do the banks have to pay for the bonds later? And if they do and don't pay, what happens to the Fed and the bonds? Does the fed have to destroy its own real reserves to make up for the excess in the sytem?
Capitalism is defined as a non intervention system, being the individuals the owners of they own rights. Our system is highly manipulated... so why are you blaming Capitalism? We don't live, and havent met Capitalism!! Because of this intervention, bubbles appear and the poor cannot start their business cause these are overtaxed or illegal or because goverment inflation. The gov is the one who has created the fiat money, and the one that keeps you being poor! Search in youtube Ron Paul.Save USA
@TheSpanishJob Capitalism will always create highly corrupt and powerful companies. The need for ever increasing profit and control is what drives them, and whatever form of monetary based economy you have, from communism to capitalism, you will ALWAYS get the corruption and human suffering that comes from this. I advocate getting rid of this inherently immoral system and bringing about a Resource Based Economy where there are no losers, only winners. And we can do that now, today.
@TheSpanishJob Just to clarify for others...i think you meant "free-market capitalism" as opposed to capitalism, as the latter term is quite broad. Most countries are capitalist to some degree, ie they accumulate capital. It is fed and govt policy of credit creation that distorts the natural workings of business and the economy, thus creating booms, then the busts. Playing with the money supply, largely via fed fund rates, creates malinvestments that can only be rectified by a recession.
bastards! crooks! federal reserve notes are MEANT to be worhtless over a period of time. the criminal financial syndicate called Fed invented this aberrant system of currency and guess what - U.S. government never said a thing - like a good puppet regime it is.
GOLD and SILVER are the only source of real money that is immune to the fiat disease. so beat them at their own game, buy and hold as much as gold as you can. i suggest you to check out MAX KEISER report here on youtube!
The treasury issuing the money would lead to massive inflation to finance welfare and warfare. There is no real difference. The government owns the right to create currency, and guess what, they gave it to the fed. The Feds interest is payed back to the treasury as well.
Your solution then, is not really a solution at all.
The reserve act determines that the reserve determines the ammount of money in supply through advisory capacity to audit office and other government bodies.
To retain the fruits of your labor know that you are the ultimate creditor and use your signature to create non-negotiable debt instruments. You are the grantor/beneficiary to at least two trusts.You have a trust deposit at the DTC (Depository Trust Company) via the Federal Reserve and one with the Social Security via the UNITED STATES Inc.
As grantor you can change the trust rules/indenture. Mke a co-trustee perform his/her duty. Like process your debt instrument. US Treasurer co-trustee
US Treasury bonds are backed by the full faith and credit of UNITED STATES Inc. Your ALL CAPS NAME, for example, JOHN H DOE is an entity of the UNITED STATES corporation. A corporate fiction which you have been defrauded into voluntary servitude.
Because you have been defrauded it is, in reality, involuntary servitude.
videos, I have a problem with one statement. "Cutting taxes while cunducting 2 wars"
The truth is that as it always does, cutting taxes brings more money into the treasury. Record amounts were collected the last several years under W. Unfortunately, record amounts were spent also, just like under Reagan. Tax cuts DO NOT CAUSE DEFICITS! Never have, never will.
@rlrm777 Wrong! Tax cuts NEVER increase government revenues. Not a single serious economist would agree with you! Please don't repeat the lies you've been told by Fox News.
I think the one aspect that is always neglected is if such debt can be incurred then why aren't we experiencing a huge inflation to match this debt creation.
I am on the lower end of society. Well when credit cards were beign issued in india. I got mine 2 years ago. I spent money and I paid 24-30per year. Interest on that amount. that isnt loaning money. Well we had something called zamindari long ago a system that is abolished now. there for 100 Rs loaned out you had to pay 125% in the first year. how is that different from zamindari system. We looked down on the zamindars, as these people robbed the average people. so did the credit cards for me.
Longer ago yet, in India you had a system in which the country was divided into various principalities and the rulers of each one was a very large, fat man. Something like a Sumo wrestler. Because periodically their subjects had to pay the equivalent of his weight in precious metals and gems. The ruler even sat upon one of the two trays of a large scale while the people placed the treasures upon the other tray until the scale became balanced
I see! Money expands in quantity, and inflation decreases its value. BUT defaulting loans also destroys specific money, and reduces the need for inflation to reduce the value of all money.
Defaulting loans are how the Money Mongrels obtain things of real value. They know that the notes they print are equivalent to Monopoly game board money. First, they create times of plenty, a robust economy. The people obtain loans because they're earning. They then turn the loans into assets, things of real value. Then the Money Mongrels create times of hardship. The people can't pay loans so they're all selling. With nobody buying, the assets' values drop. Through default, the Mongrels collect
the peoples assets for pennies on the dollar. Whereas if the values hadn't dropped, the people may have covered the loan with 1 asset. But as such, it may require 2 or 3 of their assets. Finally, the Money Mongrels cause a robust economy again and the assets which they obtained appreciate back to their normal, higher value. Thus, for every dollar they loaned, they took back multiples of a dollar on top of whatever interest had been payed prior to default. That's why we pay interest first
It's beyond my understanding why the treasury doesn't issue the money directly without being forced to pay interest to a cartel of private banks that are being deliberately hidden by the Fed. A group of private people, abhorrent leeches get colossal amounts of money for nothing. Some democracy, freedom, liberty and equality that is. The so called 'war on terror' should start with the financial terrorists in US.
J.F.K. started to do that. He signed an Executive Order which ordered the Dept. of the Treasury to start printing the bills, at no intrest. :) Got him killed. Abe. Linc. did the same thing, he printed money to pay for the Civil War that's why they killed him. Pres James Garfield was killed because he publicy said what they were doing. Money is power, and they won't let anybody get in their way. :(
The goal was to make the Fed independent of the Treasury, i.e. independent of political influence. The hope was that their independence could be based on counter-cyclical economics, not popular politics.
I am not defending the fed, just spreading info. I actually prefer commodity based currency and interest rates set by the market (Hayek).
This video neglects to draw a conclusion from the data presented. Everytime new money is created, it devalues old money. But when it's first created, it has the purchasing power of the old money. The government and banks retain the old purchasing power with newly created money and by the time it gets to most of us, prices have risen and our purchasing power is lost. It's a systematic transfer of wealth from taxpayers to the banks and it's happening on a worldwide scale with the IMF/WorldBank
@fiaskolo It is called USURE, and you know USURE it's pure fraud, if you look, even the Bible, the Vangels, and the Quran, comndemned the usure.Jesus chased away the merchants who did this in the poor people' s skin. You know what I'm doing? Buying silver.Let's crash JP Morgan.
@fiaskolo ironically I think our money maintains its place as the world reserve currency because it is being lorded over by the banking cartel. The largest banks in the world continue to profit because of how our finicial system works which is a driving factor in world economics. If the us government/citizenry was like well fuck you our money is worth x amount not the bankers it wouldnt hold the weight it does. though it doesnt make it right just ironic.
@fiaskolo What is a concern is that people are obsessed,with MONEY and who should or should not be its custodians. Even MARTENSON silent when he has evidently proved population growth, wil hit the immoveable barrier of OIL PEAKS. Inlflation on these declining reserves and stocks. THE MONEY is an illiussion.What can only save us all seriously are resourced based economies, in which machines, operates societies were science not ignorant and greed politicians, make decisions for corperations.
@fiaskolo the american dream - youtube.com/watch?v=tGk5ioEXlIM&feature=player_embedded its good source of how the fed came about. oh and just ask president Kennedy why we dont hes the last president to take on the FED by having the US treasury make there own bills with executive order 11110, 6 months later he was assassinated from the grassy knole by high ranking CIA members and the book depository was a low level CIA patsy and took the fall and the next president signed back central banking.
This guy is a CROOK. He is NOT an economist or investment professional. He is a laid-off lab technician and he is using this economic collapse as a way to MAKE MONEY from you. He is charging for his stupid seminars. Stay away from this crook. He has no idea what he is talking about. He has dozens of shills who have been brainwashed with this "Yes We Can" hype, who troll the internet promoting him. This is the truth.
Martenson, GET A JOB AND STOP EXTORTING MONEY FROM DESPERATE FOOLS.
This guy is a tool. He is NOT an investment professional, has NO experience or EXPERTISE in the financial markets, economics or anything related to investments. Noticehow he is reading from a script. hahahaha. This guy is a vulture preying on the desperation of investors, selling his "crash course" trash. Hey dude, STOP RIPPING PEOPLE OFF. YOU DID NOT PREDICT THIS MESS AND YOU HAVE NO EXPERTISE TO UNDERSTAND IT. You're a crook who obviously lost your job and now you're trying to take ppls money
he may or may not be right on the nitty-gritty details, i don't know, i hate money and finance, and so know very little about it. as i understand it though, his key concept #4 is pretty much correct vis a vis banking and growth capitalism. it must grow to stay viable.
borrowing money from the FED means having to pay the FED interest on money the FED doesn't have, just prints. if gov spends
money to create something, they order a "chair" or a road from you. you make it, you get money from the gov. the gov gets a road it can
toll or give to you & business so wealth is CREATED. why would gov want to "borrow" money at interest from the FED, money the FED doesnt have, when money's supposed to reflect work thats being DONE, not
Key point #4 is also wrong. Total bank credit in Japan declined for 60 consecutive months. The banking system did not collapse. The general price level simply went down.
The implications of what the Fed actually does is enough, no need to conflate it to be a bigger problem that it is. Better to focus on the facts that the FED doesn't have to account for its expenses and decides its own budget. The spend some of that budge funding 'studies' and major universities, manufacturing consent.
Ouch, I was surprised that such a Fed Watcher actually presents the fallacy that an equal amount of debt must be created to pay the interest each year.
The interest paid to the FED by the Treasury on the FED holdings of T-Bonds, is used to cover the annual expenses of the FED (a small fraction of their interest earnings), the rest is remitted back to the Treasury (by law).
The way you explain it create the conspiracy that the Treasury can never by off its issued debt by design. That is false.
"At a minimum, each year enough new money must be loaned into existence to cover the interest payments on all of the past outstanding debt."
Chris, great presentation but I don't think the above statement is correct. Bank profits can be cycled back into the economy to pay back the interest. Interest must be some kind of factor in growth, but not to the extent you put it.
An interview I did with Richard Douthwaite explains another mechanism by which debt based currency itself (not the interest) is a core driver of growth. Google "Richard Douthwaite Adam Fenderson interview" (without the quotation marks) to find it.
Thanks for your comment, manchovie, it made me think more deeply about the issue. I think that you've omitted the fact that bank profits are also loaned money (from FED or banks themselves) because the system does not have a source of interest-free money. Thus I believe the video is correct.
As I heard it, the Fed creates Bonds which are sold to China et al. in return for cash. I think the Fed can later buy back those bonds but in the process increase the money supply and increase inflation. Does that sound right?
"May you live in interesting times" - Chinese curse
doc7474 6 days ago
How does the UK make it's money?
candistyx 1 week ago
Obviously the problem is that this system REQUIRES perpetual growth. That's a fatal flaw in itself. You can't have perpetual growth.
ReviewsByErik 1 month ago in playlist Chris Martenson presents The Crash Course
Damn, all this time I thought banks had to hold 90% in reserves and this video says 10% in reserves? That's insane! No wonder they're at risk for bank runs LOL
ReviewsByErik 1 month ago in playlist Chris Martenson presents The Crash Course
This isn't just in the US it is happing in every western country in the world.
303anzac 1 month ago
I hope someone can answer this question! If all money is loaned into existence, how can the gov inflate away the debt? It can only create money by issuing new debt, therefor doubling the money supply to devalue debt can't work, because it had to take a loan equivalent to the existing money supply to inflate the original debt away, but it now owes twice as much
christo930 2 months ago
it was designed to collapse the US economy
bangmeister 3 months ago
ok get it, Goverment has an outstanding debt for the next year, and it needs money to pay back. So the most probable scenario is borrowing money again, issuing more bonds, just in case goverment does not have money. But what happens if a responsible goverment saves and has surplus of money rather than a deficit, then they wouldn´t need print bonds to face its problems. No money creation from the government. Of course companies also issue debt and banks too, so that´s tricky isnt???
mentorgratis 3 months ago
Comment removed
billmandell1 3 months ago
Well, nice video. But, I disagree a bit on your statement that 'it is an exponential system by its very design'. That's because when the 'demand' in the economy is low, the total amount of money in the system will reduce as the banks wouldn't find enough customers (who would loan new money into existence), and hence they will return the money to the Fed and close their debt position.
abhisheksuraj 4 months ago
@abhisheksuraj well abhishek how do u expect a decrease in demand by continues growing world population ... the increasing population will always put a stress on demand in one way or the other
amanvds 3 months ago
@amanvds Well, that`s a wrong comparison. We are talking of 'loan money' and not 'food', whose demand will increase with the increasing population. Anyway, here are my two points on why demand will decrease - as the risk increases (home prices falling, banks crashing) and interest rates increase (money is costlier) demand for loans will come down. The reason why there is such a huge 'debt mountain' in the world, is that the interest rates were dirty low for a very long time - which is wrong.
abhisheksuraj 2 months ago
The exponential growth that is claimed to be unstainable. Is that really the case? Why can't gradual inflation simply counter this? I am unconvinced that this system, although bad for many reasons, cannot be sustained indefinitely without perpetual economic expansion. This end deserves more scrutiny than just a globe sitting on a graph.
DCUPtoejuice 4 months ago
But the Fed could pay printed dollars for T-bills and simply forgive that debt. The Fed would not be "out money" because it simply paid for the T-bills with nothing.
The Fed prints money. It is only tied to debt because of the nature of the system. There is no requirement for the handling of fiat currency that demands a bond exchange system.
TacticusPrime 4 months ago
I feel the exact same way Chris! If you think of the thousands of years humans have been around, and to witness a catastrophic event in your lifetime, that is truly a lucky opportunity. Thus whatever does happen is not perceived as necessarily negative, but enlightening and understanding.
maltodextrin1000 5 months ago
This video is rather misleading. Money isn't lent into existence by the fed, it's spent into existence by the government, subtle difference. Without an expansion of the money supply, the economy couldn't grow. Your income is someone else's spending, so without an expanding money supply, it'd be impossible for the private sector to accumulate dollars.
hrmIwonder 5 months ago
@hrmIwonder The fed creates money out of thin air, there is no counter-argument against that. You can't just argue that this video is misleading, because it is telling the truth that many people don't want to be known.
T0B0KKE 5 months ago 4
@T0B0KKE No, this video is wrong, Our money is not backed by debt. Our money is by definition a govt liability(since it cancels your liability with the govt), ie debt. Private sector savings IS government debt. Your income is someone else's spending, whose income was someone else's spending, so in order for the private sector as a whole to accumulate dollars, the gvt must deficit spend. To 'pay back the debt' would mean sucking all money out of the economy. Its illogical.
hrmIwonder 5 months ago
@hrmIwonder If all debts would be payed off today, tomorrow there wouldn't a single dollar in circulation, right? You might be right on that regard, but the fed and the fractional reserve banking system are systems of money creation without any liability for them. It's essentially thin air money. When the US gone into wars, they printed money far beyond gold reserve levels to fund their war efforts. That's fiat money. Money without value for itself unless some kind of law states that it has...
T0B0KKE 5 months ago
@T0B0KKE we've been fiat since 1971. Your money is by definition a govt liability, since it will cancel out your liability with the govt (the liabilities cancel). What gives money "its value", is the ability of a govt to enforce a tax of some sort in that currency, so you have to get the currency in order to pay the tax. See wikipedia's page for hut tax.
hrmIwonder 5 months ago
@hrmIwonder The hut tax was used in colonial Africa, not now. What we could call a tax is inflaction. The loss of money value is like and hidden tax on savers. Again there is currently nothing giving fed money value, unless the gov says it has! And yes I know we've been fiat since 1971. Chris and his videos/books have been the best explanation so far about how modern money works. If it is spent or loaned into existence, it doesn't really matter, does it?
T0B0KKE 5 months ago
@T0B0KKE Yes it matters, if you take a loan from a bank, you have to pay it back, this means no new net financial assets in the private sector. Government spends it doesn't expect to be paid back, otherwise this would suck all money out of the system. The tax view is correct, there's been cases where a king's decree wasn't enough to make the currency accepted, you have to impose a liability on the people, so they need the currency to pay the tax. Taxes are not inflationary, they take money out.
hrmIwonder 5 months ago
@hrmIwonder Banks do pay interests back to the fed. Printed fed money is payed back with interests! Yes, it does! And liabilities doesn't cancel. If entity X owes 1$ to Y, Y owes 1$ to Z, and Z owes 1$ to X again, their mutual debts aren't cancelled even thought it would seem logical to. When goverment spends money either it came from taxes, exportation (if the external deficit is bellow 0%), selling treasury bonds in financial markets or loaning fed money. IT IS LOANED into existence.NOT SPENT!
T0B0KKE 5 months ago
@T0B0KKE Money isn't backed by debt, it IS debt. The money in your wallet is your asset, & on the other side of the balance sheet, it's the govt's liability, ie private sector savings is govt debt. By definition. There's no 'paying back' the govt debt. Just imagine if govt ran a surplus for too many years, there'd be no money left in the private sector (the govt 'debt' would be 0 and private sector savings would be 0), currency issuer vs. users. they're opposite sides of the balance sheet.
hrmIwonder 5 months ago
@T0B0KKE that is an awesome observation. So to increase the money supply, why doesn't the Fed just arrange investment circles like this? Perhaps they do.
DCUPtoejuice 4 months ago
@DCUPtoejuice They don't. That's because debt is always greater than money in circulation. It's the old example of 100 people on an island with 10 shells each. They find out that 10 shells isn't enough to buy stuff, so they start to borrow 1 shell and in return pay 2. At the end of the year in the island reunion they count the debt and find out that every single person owes 20 shells and the total debt is 2000 shells, way above the total shell supply of 1000...
T0B0KKE 4 months ago
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@DCUPtoejuice They don't. That's because debt is always greater than money in circulation. It's the old example of 100 people on an island with 10 shells each. They find out that 10 shells isn't enough to buy stuff, so they start to borrow 1 shell and in return pay 2. At the end of the year in the island reunion they count the debt and find out that every single person owes 20 shells and the total debt is 2000 shells, way above the total shell supply of 1000...
T0B0KKE 4 months ago
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@DCUPtoejuice They don't. That's because debt is always greater than money in circulation. It's the old example of 100 people on an island with 10 shells each. They find out that 10 shells isn't enough to buy stuff, so they start to borrow 1 shell and in return pay 2. At the end of the year in the island reunion they count the debt and find out that every single person owes 20 shells and the total debt is 2000 shells, way above the total shell supply of 1000...
T0B0KKE 4 months ago
1:06 Could someone please provide a link supporting this statement. Thank You
FeelGoodinc91 5 months ago
how can people still not understand how the system works after a video like this that breaks it down to a retards level? JHC
djsyphonik 6 months ago
If the Fed buys back bonds with money created out of thin air, then why is the US government currently in risk of having to default on their loans? I thought this was due to the fact that it is the actual government that has to buy back bonds and pay interest.
Tarmbosse 6 months ago
@Tarmbosse the Fed is not part of the US Government. It is a private institution. The US is "in risk of defaulting" (that's not going to happen anyway) because of the high debt it helds and the need to issue more and more bonds to pay back the bonds that are due.
eordano 6 months ago
Can't anyone design a money system that works for shrinking?
bvssvni 6 months ago
@bvssvni Well their was the system used in colonial America prior to the revolutionary war.
Metaphysicist 5 months ago
@bvssvni Better take money out of the picture then...
T0B0KKE 5 months ago
If the FED pays the debt out of nothing how come is there any debt? And to whom is the debt owed?
Joker9588 7 months ago
@Joker9588 To the internation gangster banking cartels.
This documentary dosent show the full picture. Go watch the documentary MONEY MASTERS
and MONEY AS DEBT
and AMERICA FREEDOM TO FASCISM BY AARON RUSSO
and a few facts:
1.The fed is a private bank which is more powerful then thee american government
2.The fed prints money out of thin air then borrows it to gov at face value
3. Retail banks then create money through fractional banking which is basically printing money in plain english.
akscldn 6 months ago
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Joker9588 7 months ago
A biggest public campaign has started to end fractional reserve banking, look at the POSITIVE MONEY website and support the campaign ...and spread the word.
PositiveMoneyUK 7 months ago 7
I'm not sure the Fed's Fractional Reserve System is a scam. Abraham Lincoln and other prominent peeps wanted the government to create money directly without the Fed, but do you trust the government to create money judiciously? Hmmm, what are you doing now Obama (sadly the check in the system, the Fed, is not stopping his $100 billion / month GFC "fix").
climatereview 7 months ago
Just ask the bank via a letter to provide you with actual accounting (an invoice will do) as to where they substantiated a loss and had a risk in the investment. Also, to provide a copy of the contract binding both parties, not just you (How could a corporation sign? It can't. What you have is a unilateral contract, not a bilateral one.) Lastly, ask them to show where they provided you with full disclosure by telling you that the "money" in question adds to inflation.Wait28days.Senddefaultnotice
20Proff 7 months ago
So the Treasury always sells Bonds to 'Big Banks' and never to the Federal Reserve directly or does that happen as well? I'm confused as to why the Federal Reserve would want to make money out of thin air to buy bonds that where bought by 'Big Banks' from the Treasury instead of just buying bonds, with money made from nothing, from the Treasury directly?
AveiMil 8 months ago
@AveiMil Because the Treasury does not have the authority to print money. They have to "sell" the bonds to the Fed so they can authorize the Mint to print the money. The Fed took the authority to print money from the Treasury back in 1913.
dc5bom 8 months ago
@JakobsMovieTutorials word up man, add me on youtube, i got a bunch of sick documentaries/music/info on my favorites
AtheistAnarchoRudi 8 months ago
@JakobsMovieTutorials what is up fellow humanoid!?
AtheistAnarchoRudi 8 months ago
The treasury is refunded the interest. The Fed is not a private bank. It's stocks act as bonds and all profits except 6 & are turned over to the govt. This guy leaves a lot out that is important.
Peteou813 8 months ago
/watch?v=4Z9WVZddH9w
AtheistAnarchoRudi 9 months ago
Thanks for the video its very educational and I agree, that some people in the money creation system are actualy paid for nothing...But the FED is needed to regulate the economy, as they doing it now, by the rules and responsibility. Some people think, they want to destroy all humanzzz !!! and such... well they actualy need people and they need them to be whealthy, so they can make even more money. I want to save the world and I want peace, thats why I use condom, dont make kids theyr the debt:)
LitongX1 9 months ago
@LitongX1 you sound crazy US was doin find before 1913 when the fed became. i have been feelin some kind of way for years. It wasn't untill a friend told me about a few movies on the system, and after you watch them tell the same thing i think not.
MrBlackBuds 9 months ago
@MrBlackBuds Well even more crazy for me is that gold have bigger value than food... I cannot eat gold or silver I have no use for living from it.... I mean some things are how they are. Ok the dollar is no longer covered by gold BUT can be exchanged with other countries currency you actualy buy "something" from or in other country for a "piece of paper" right ? With this you are now not alone in trouble, not because of the central banks, but for example now the dollar is falling against euro.
LitongX1 9 months ago
@MrBlackBuds and maybe some people think how cool is that, but the export to US will also fall and there are few countries, which are not very happy with that for example - China. So some instruments will start to work against this fall the machine is perfect, but I agree some thinks need to be fixed, because its very flustrating and not fun at all.
LitongX1 9 months ago
Wait, if you go bankrupt aren't you essentially destroying debt?
MacabreManifesto 10 months ago
@MacabreManifesto Not when we live in a country that will let you go bankrupt but it will protect the Achilles heel by bailing out your debt...... isn't our government nice
YaHuWaHservant 9 months ago
@YaHuWaHservant To the rich.
MacabreManifesto 9 months ago
@MacabreManifesto Ain't that the truth. You know big Corporations like GE etc don't pay taxes but like just a couple days ago Obama said he is going to raise taxes on small businesses. WTF?
YaHuWaHservant 9 months ago
Well done. An abundance of penetrative critical analyses concerning the Fed's transgressions and fraudulent activities are available in this medium, but too few among these are enriched by your positivity and wholly comprehensible presentation.
rqbuchanan 10 months ago
Pt 5bBy your own admission a hockey stick can made as long as you adjust it. The hockey stick only really applies when there is limits.Thus the Exponential "Controlled" money supply growth is limitless and as the population efficiency and total output is limitless a problem does not exist. Again In emphasize Controlled money supply Growth to reflect the equivalent production output. Let's not forget we just had a surplus a few years back. No reason why we cannot return to that type of prosperity
Minethis1 11 months ago
@Minethis1 Then you do not understand exponential concepts. Yes the hockey stick can be adjusted but the rate of growth cannot. The whole point of the exponential is that it tends to run away with a rate of change that is too fast to deal with. History is full of examples of this. The world's financial systems cannot sustain current required growth because the rate of growth of debt is now too high.
Huttate1 9 months ago
@Huttate1 I understand expo very well ty. Living on water or under it. Finding new planets, Catastrophic War disease etc. Do not limit your thoughts. The world financial system is based off of cash savings. China for the most part has been supply the world with cash savings which is supporting the Debt. Since 2001 Every 40 months they double their total currency.(crazy exponential growth). This is causing low rates. Low rates = High debt High rates = Low Debt Rate can be adjusted that is a Fact
Minethis1 9 months ago
Part 3 You are rewarded for producing less. How is that prosperity? This is why modern economics is based on Growth. Further more if inflation is controlled there is no reason why you cannot invest with limited risk in safe inflationary instruments. Unless of course one doesn't care about their money to begin with. In that case it is a personal choice that one makes.
Minethis1 11 months ago
Chris As you said in part 5 Money is a claim on human labor both present and future output. Thus all Money that is loaned into existence is based on future population growth increased efficiency and output. So to say that money is created out of thin air is a false statement. This is not to say that printing can go on continuously forever at a rate that exceeds output growth. In fact if there is not enough money in circulation it is actually deflationary! Like Gold which is limited as you said.
Minethis1 11 months ago
@Minethis1 Part 2 A limited amount of money supply like Gold Cannot accurately measure the unlimited production output. ie. exponential growth in population labor and efficiency. if there is a total of 10 GOLD pieces and total population of 10 producing 10 units The total output is1 gold piece per person per unit. As the population grows to 20 and the output also doubles the VALUE per person decreased by 50% to .5 pieces of gold per person per unit. This is clearly deflationary and negetive.
Minethis1 11 months ago
/watch?v=4Z9WVZddH9w -- for the best alternative to this mind-blowing system.
Trickndel 11 months ago
@Trickndel ZEITGEIST is a load of crap!
Minethis1 11 months ago
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Thank you very much for posting this video. In 5 minutes you have taught me more than both of my economic professors have in regards to the Federal Reserve. This is not sarcasm, this is fact.
MrRobertGriffith 1 year ago
Thank you very much for posting this video. In 5 minutes you have taught me more than both of economic professors in regards to the Federal Reserve. This is not sarcasm, this is fact.
MrRobertGriffith 1 year ago
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The Zeitgeist Movement (TZM) brought up some Real and Tangible Solutions to ACTUALLY SOLVE OUR ECONOMICAL, SOCIAL & ECOLOGICAL CRISIS - to know more about it, watch: "Awakening - Multilang - 1/4" (short video) and "Zeitgeist Addendum". Both of them are on YouTube. The SOLUTIONS presented in both videos are already being applied and they have already been proved to work in the short and long run. It's about time to expand/spread it World Wide.
VISIT:
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FS
FactualSolutions 1 year ago
I agree about getting swindled on purchasing power as long as people dont loose sight of other factors. Tell mr johnson greeting you at walmart who lost his house after the factory relocated to China while the CEO tripled his revenues that his loss in purchasing power is all due to "inflation" (or that the 50s middle class was worst off than dickensian 20s workers because coke was a dime more)
Rickdeckard2020 1 year ago
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tiblon1 1 year ago
OMG...too much information
HoodSick 1 year ago 9
I can only hope that enough people will wake up to this fraudulent money system before its to late. Continuous growth is just not realistic on a finite planet. If we want more growth then we have to invest heavily in space travel so that we can populate other planets and eventually other solar systems. This simply won't be possible in a monetary system at its current state. For humanity to survive we have to move past this concept of consumerism and focus completely on sustainability.
addiktion13 1 year ago
Funny thing is a nation started all of a sudden right now with a positive balance, it would be the only nation on earth with a positive value.
HWGuyEG 1 year ago
why does the goverment have to loan money at the treasury? why can't the goverment print the money itself? Why does the goverment loan the money with intrest? Is the treasury a private insitute? It has to be right?
colloredbrothers 1 year ago
@colloredbrothers A few of our founding fathers originally wanted the government to loan money itself. It would have been a much better route to go but equally politicians aren't much better at managing money. The government doesn't loan the money with interest, the banks do. The government pays interest on the loan from the Federal Reserve. The US Treasury is a government institute but the Fed is a private institute. it prints money out of thin air and loans it to the gov with interest.
addiktion13 1 year ago
since the Rothchilds own all the money and they control it in the Stock markets buying low selling after everyone is frightened into selling also...then buying up everything at the low price.
hatemurder 1 year ago
This is why I stop paying my mortgage 2 years ago...and living rent free !
TheBigdick888 1 year ago
@TheBigdick888 you're a loser and its scum like you that are making things worst than they should be. May you become homeless,and have creditors hound you for the rest of your worthless life.
alex94115 1 year ago
I have pre-ordered it! :D I have the money I've earned with the system explained at ez-casino(dot)com
kathiAcevedovimi 1 year ago
This vid is utter crap money is NOT backed by debt as it fails to understand that 1 mans debt MUST be another mans asset.
funisverygood 1 year ago
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cloudburstlenepmhq 1 year ago
It was my understanding that the Federal Reserve not only purchases treasury bonds from banks, but that it also purchases treasury bonds on the open market directly from the treasury as the banks do. Is that not correct?
ACDC7369 1 year ago
Look up
President John F. Kennedy signed Executive Order No. 11110
DeepSpace8andahalf 1 year ago
you missed one point about servicing the debit interest. Bank profits to employee's from credit interest and earned from savings also goes into the economy which essentially pays the debit interest.
daragazzo 1 year ago
bankofenglandact (dot) co (dot) uk
psb87 1 year ago
Ok, but what does the fed do with the bonds? You said that the Fed exchanges newly created cash for the bond--which it exchages with the banks. What does the Fed do with the bonds? Do it destroy them? Or do the banks have to pay for the bonds later? And if they do and don't pay, what happens to the Fed and the bonds? Does the fed have to destroy its own real reserves to make up for the excess in the sytem?
gogolando 25 seconds ago
gogolando 1 year ago
Ok, but what does the fed do with the bonds? You said that the Fed exchanges newly created cash for the bond--which it exchages with the banks. What does the Fed do with the bonds? Do it destroy them? Or do the banks have to pay for the bonds later? And if they do and don't pay, what happens to the Fed and the bonds? Does the fed have to destroy its own real reserves to make up for the excess in the sytem?
gogolando 1 year ago
Capitalism is defined as a non intervention system, being the individuals the owners of they own rights. Our system is highly manipulated... so why are you blaming Capitalism? We don't live, and havent met Capitalism!! Because of this intervention, bubbles appear and the poor cannot start their business cause these are overtaxed or illegal or because goverment inflation. The gov is the one who has created the fiat money, and the one that keeps you being poor! Search in youtube Ron Paul.Save USA
TheSpanishJob 1 year ago
@TheSpanishJob Capitalism will always create highly corrupt and powerful companies. The need for ever increasing profit and control is what drives them, and whatever form of monetary based economy you have, from communism to capitalism, you will ALWAYS get the corruption and human suffering that comes from this. I advocate getting rid of this inherently immoral system and bringing about a Resource Based Economy where there are no losers, only winners. And we can do that now, today.
skept1c615 1 year ago
@TheSpanishJob Just to clarify for others...i think you meant "free-market capitalism" as opposed to capitalism, as the latter term is quite broad. Most countries are capitalist to some degree, ie they accumulate capital. It is fed and govt policy of credit creation that distorts the natural workings of business and the economy, thus creating booms, then the busts. Playing with the money supply, largely via fed fund rates, creates malinvestments that can only be rectified by a recession.
AussieAustrianBlog 1 year ago
'When the Federal Reserve writes a check, it is creating money. "
jphwacheski 1 year ago
Asses(ts) to the left of us, big banks to the right, here I am FUCKED in the middle with you.
LazyOtaku 1 year ago
@LazyOtaku
The reason why hyperinflation is in our future.
Better start stocking canned goods, guns, and precious metals(lead).
Won't hurt to have some form of livestock as well....
ziggy2sound4u 1 year ago
you sound sexy
meaghanmac1991 1 year ago
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bastards! crooks! federal reserve notes are MEANT to be worhtless over a period of time. the criminal financial syndicate called Fed invented this aberrant system of currency and guess what - U.S. government never said a thing - like a good puppet regime it is.
GOLD and SILVER are the only source of real money that is immune to the fiat disease. so beat them at their own game, buy and hold as much as gold as you can. i suggest you to check out MAX KEISER report here on youtube!
pingadomulatinha 1 year ago
The treasury issuing the money would lead to massive inflation to finance welfare and warfare. There is no real difference. The government owns the right to create currency, and guess what, they gave it to the fed. The Feds interest is payed back to the treasury as well.
Your solution then, is not really a solution at all.
10speech110 1 year ago
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johnnypop82 1 year ago
The reserve act determines that the reserve determines the ammount of money in supply through advisory capacity to audit office and other government bodies.
CyberAthletethefirst 1 year ago
To retain the fruits of your labor know that you are the ultimate creditor and use your signature to create non-negotiable debt instruments. You are the grantor/beneficiary to at least two trusts.You have a trust deposit at the DTC (Depository Trust Company) via the Federal Reserve and one with the Social Security via the UNITED STATES Inc.
As grantor you can change the trust rules/indenture. Mke a co-trustee perform his/her duty. Like process your debt instrument. US Treasurer co-trustee
zonsb 1 year ago
US Treasury bonds are backed by the full faith and credit of UNITED STATES Inc. Your ALL CAPS NAME, for example, JOHN H DOE is an entity of the UNITED STATES corporation. A corporate fiction which you have been defrauded into voluntary servitude.
Because you have been defrauded it is, in reality, involuntary servitude.
zonsb 1 year ago
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"National insolvency is caused by Congress spending too much, not taxing too little. " YES! AGREED!
mrcoffeeQQQ 1 year ago
National insolvency is caused by Congress spending too much, not taxing too little.
herbs814 2 years ago
Although there is much great info in these
videos, I have a problem with one statement. "Cutting taxes while cunducting 2 wars"
The truth is that as it always does, cutting taxes brings more money into the treasury. Record amounts were collected the last several years under W. Unfortunately, record amounts were spent also, just like under Reagan. Tax cuts DO NOT CAUSE DEFICITS! Never have, never will.
Not my opinion, a matter of record.
rlrm777 2 years ago
@rlrm777 Wrong! Tax cuts NEVER increase government revenues. Not a single serious economist would agree with you! Please don't repeat the lies you've been told by Fox News.
QuatuorMortis 1 year ago
great stuff chris. keep it going! Peter Schiff for senate
3daughterskillme 2 years ago
@3daughterskillme true that. greets from romania
fritzroy15 1 year ago
im not thrilled at all...
BloodMech21 2 years ago
Hello ChrisMartensondotcom
I have to admit I am very impressed with the quality of your videos here on youtube.
They are certainly a pleasure to watch as I do enjoy them.
I am sure there is many others who also feel the same about your videos.
Mark McCulloch
MarkMillionaireGuru 2 years ago 2
I think the one aspect that is always neglected is if such debt can be incurred then why aren't we experiencing a huge inflation to match this debt creation.
25sounds 2 years ago
@25sounds: see Chapter 16. Fudging numbers.
fupedworld 2 years ago
more debt = more inflation?
aaroncoleman3 2 years ago
@aaroncoleman3: Yes. But the government lies with statistics. See Chapter 16.
fupedworld 2 years ago
Anyone with basic knowledge of the central banking system will realise just how much of a monolithic scam it is.
SpaceMonkeeys 2 years ago 59
I am on the lower end of society. Well when credit cards were beign issued in india. I got mine 2 years ago. I spent money and I paid 24-30per year. Interest on that amount. that isnt loaning money. Well we had something called zamindari long ago a system that is abolished now. there for 100 Rs loaned out you had to pay 125% in the first year. how is that different from zamindari system. We looked down on the zamindars, as these people robbed the average people. so did the credit cards for me.
seekerbiswas 2 years ago
Longer ago yet, in India you had a system in which the country was divided into various principalities and the rulers of each one was a very large, fat man. Something like a Sumo wrestler. Because periodically their subjects had to pay the equivalent of his weight in precious metals and gems. The ruler even sat upon one of the two trays of a large scale while the people placed the treasures upon the other tray until the scale became balanced
Interesting world we live in!
Chuichupachichi 2 years ago
I see! Money expands in quantity, and inflation decreases its value. BUT defaulting loans also destroys specific money, and reduces the need for inflation to reduce the value of all money.
aresmars2003 2 years ago
Defaulting loans are how the Money Mongrels obtain things of real value. They know that the notes they print are equivalent to Monopoly game board money. First, they create times of plenty, a robust economy. The people obtain loans because they're earning. They then turn the loans into assets, things of real value. Then the Money Mongrels create times of hardship. The people can't pay loans so they're all selling. With nobody buying, the assets' values drop. Through default, the Mongrels collect
Chuichupachichi 2 years ago
the peoples assets for pennies on the dollar. Whereas if the values hadn't dropped, the people may have covered the loan with 1 asset. But as such, it may require 2 or 3 of their assets. Finally, the Money Mongrels cause a robust economy again and the assets which they obtained appreciate back to their normal, higher value. Thus, for every dollar they loaned, they took back multiples of a dollar on top of whatever interest had been payed prior to default. That's why we pay interest first
Chuichupachichi 2 years ago
It's called inflation. When the numerical quantity of the money exceeds the material value of society it loses representational value. T
oweninc 2 years ago
Who owns the Fed Reserve? And, who regulates them?
ammusi 2 years ago
The Big Banks own the Fed and regulate themselfs.
One thing to keep in mind is that if we get rid of the Fed their dollar goes with them.
CosmosPrivateer 2 years ago
H.R 1207......................
soundgarden21 2 years ago 2
so who are the owners of the fed reserve?
nervs777 2 years ago
Interesting... He said that money creation is simple... I must be stupid, because I got very confused with this.
ShwangShwing 2 years ago
It's beyond my understanding why the treasury doesn't issue the money directly without being forced to pay interest to a cartel of private banks that are being deliberately hidden by the Fed. A group of private people, abhorrent leeches get colossal amounts of money for nothing. Some democracy, freedom, liberty and equality that is. The so called 'war on terror' should start with the financial terrorists in US.
fiaskolo 2 years ago 68
I think, this is how it works all over the world (not just in US). In every national state that has its own currency.
FED simply printing money but also ECB (Euro), BOJ (Yen), ect... do.
This is banking system in action, without this it would be no banking system at all.
It's not so thefty as you might think... You can rise your own Bank if you want...
StratenaMatoha 2 years ago
J.F.K. started to do that. He signed an Executive Order which ordered the Dept. of the Treasury to start printing the bills, at no intrest. :) Got him killed. Abe. Linc. did the same thing, he printed money to pay for the Civil War that's why they killed him. Pres James Garfield was killed because he publicy said what they were doing. Money is power, and they won't let anybody get in their way. :(
troyalldis 2 years ago 5
@troyalldis Don't forget the assassination attempt of Andrew Jackson...
SavingUSA101 7 months ago
@fiaskolo
The goal was to make the Fed independent of the Treasury, i.e. independent of political influence. The hope was that their independence could be based on counter-cyclical economics, not popular politics.
I am not defending the fed, just spreading info. I actually prefer commodity based currency and interest rates set by the market (Hayek).
FrickinLaserBeam 1 year ago
@fiaskolo thank god you have a brain don't you wish others would think like you i wish people understood things better
bxccapricorn 1 year ago
@fiaskolo because they are corrupted and/or manipulated.
skept1c615 1 year ago
This video neglects to draw a conclusion from the data presented. Everytime new money is created, it devalues old money. But when it's first created, it has the purchasing power of the old money. The government and banks retain the old purchasing power with newly created money and by the time it gets to most of us, prices have risen and our purchasing power is lost. It's a systematic transfer of wealth from taxpayers to the banks and it's happening on a worldwide scale with the IMF/WorldBank
ACDC7369 1 year ago
@fiaskolo It is called USURE, and you know USURE it's pure fraud, if you look, even the Bible, the Vangels, and the Quran, comndemned the usure.Jesus chased away the merchants who did this in the poor people' s skin. You know what I'm doing? Buying silver.Let's crash JP Morgan.
evadidio 1 year ago
@fiaskolo ironically I think our money maintains its place as the world reserve currency because it is being lorded over by the banking cartel. The largest banks in the world continue to profit because of how our finicial system works which is a driving factor in world economics. If the us government/citizenry was like well fuck you our money is worth x amount not the bankers it wouldnt hold the weight it does. though it doesnt make it right just ironic.
awsomeshot 1 year ago
@fiaskolo What is a concern is that people are obsessed,with MONEY and who should or should not be its custodians. Even MARTENSON silent when he has evidently proved population growth, wil hit the immoveable barrier of OIL PEAKS. Inlflation on these declining reserves and stocks. THE MONEY is an illiussion.What can only save us all seriously are resourced based economies, in which machines, operates societies were science not ignorant and greed politicians, make decisions for corperations.
nbm34 11 months ago
@fiaskolo the american dream - youtube.com/watch?v=tGk5ioEXlIM&feature=player_embedded its good source of how the fed came about. oh and just ask president Kennedy why we dont hes the last president to take on the FED by having the US treasury make there own bills with executive order 11110, 6 months later he was assassinated from the grassy knole by high ranking CIA members and the book depository was a low level CIA patsy and took the fall and the next president signed back central banking.
enlighteningshockras 11 months ago
@fiaskolo we will tahe them down this time; the cats too far outa the bag
bullsnutsoz 9 months ago
2:45 : "Given the fact that[...]"
It makes sense to switch to get the hell out of Dodge and switch to another money, is what makes sense... : P
PanzerDivisionBOM 2 years ago
wow, we really shouldn't loan out our treasury bonds to other countries, because wouldn't that just end up funding them at our expense
willy14916 2 years ago
Yes but then who would buy them then? And if no one buys them (loans you americans money) then where would you get the money from?
AIQ88 2 years ago
that is a good point, i guess the american people could but not in the amount we need
willy14916 2 years ago
From FED.
FED can buy banks' bonds (simple by printing money) and government (I think with FED cooperation) determines the interest.
Central Banks simply print money (through buying bonds) with money that DOES NOT EXIST!
StratenaMatoha 2 years ago
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Richballermoney 2 years ago
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This guy is a CROOK. He is NOT an economist or investment professional. He is a laid-off lab technician and he is using this economic collapse as a way to MAKE MONEY from you. He is charging for his stupid seminars. Stay away from this crook. He has no idea what he is talking about. He has dozens of shills who have been brainwashed with this "Yes We Can" hype, who troll the internet promoting him. This is the truth.
Martenson, GET A JOB AND STOP EXTORTING MONEY FROM DESPERATE FOOLS.
exposingcrooks2009 2 years ago
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This guy is a tool. He is NOT an investment professional, has NO experience or EXPERTISE in the financial markets, economics or anything related to investments. Noticehow he is reading from a script. hahahaha. This guy is a vulture preying on the desperation of investors, selling his "crash course" trash. Hey dude, STOP RIPPING PEOPLE OFF. YOU DID NOT PREDICT THIS MESS AND YOU HAVE NO EXPERTISE TO UNDERSTAND IT. You're a crook who obviously lost your job and now you're trying to take ppls money
ispeakthetruth2008 2 years ago
Wait some 10-15 years or so, then write again on this topic
marottt 2 years ago
he may or may not be right on the nitty-gritty details, i don't know, i hate money and finance, and so know very little about it. as i understand it though, his key concept #4 is pretty much correct vis a vis banking and growth capitalism. it must grow to stay viable.
polyzygote 2 years ago
borrowing money from the FED means having to pay the FED interest on money the FED doesn't have, just prints. if gov spends
money to create something, they order a "chair" or a road from you. you make it, you get money from the gov. the gov gets a road it can
toll or give to you & business so wealth is CREATED. why would gov want to "borrow" money at interest from the FED, money the FED doesnt have, when money's supposed to reflect work thats being DONE, not
numbers borrowed.
gunthaarz 2 years ago
Key point #4 is also wrong. Total bank credit in Japan declined for 60 consecutive months. The banking system did not collapse. The general price level simply went down.
The implications of what the Fed actually does is enough, no need to conflate it to be a bigger problem that it is. Better to focus on the facts that the FED doesn't have to account for its expenses and decides its own budget. The spend some of that budge funding 'studies' and major universities, manufacturing consent.
doobadoo1 2 years ago
Ouch, I was surprised that such a Fed Watcher actually presents the fallacy that an equal amount of debt must be created to pay the interest each year.
The interest paid to the FED by the Treasury on the FED holdings of T-Bonds, is used to cover the annual expenses of the FED (a small fraction of their interest earnings), the rest is remitted back to the Treasury (by law).
The way you explain it create the conspiracy that the Treasury can never by off its issued debt by design. That is false.
doobadoo1 2 years ago
The Federal Reserve is a criminal operation that needs to shut down and all share holders of that criminal bank arrested.
freedomfighterone 2 years ago 4
Ron Paul - H.R.1207: Federal Reserve Transparency Act of 2009.
This is pass we'll know what's going on at the fed.
cnxtrans 2 years ago 5
this is passed?
basiclifej 2 years ago
Sorry, I meant if this pass...
cnxtrans 2 years ago
I doubt it will pass... because you can buy and sell congressman in this country!!!
basiclifej 2 years ago
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The is misleading no money created the bank has money from when it sold thebond originally - no mmoney has been creatde.
Asshole.
ufewl 2 years ago
Well put... Very convincing... Your command of the English language is incredible.
haplau 2 years ago
You got my attention. I like that you're not placing good or bad on topics. I will continue on in your video series. Thanks. SifuZ
ps- slide shows are a lot of work... awesome job.
wingchunclub 2 years ago
"At a minimum, each year enough new money must be loaned into existence to cover the interest payments on all of the past outstanding debt."
Chris, great presentation but I don't think the above statement is correct. Bank profits can be cycled back into the economy to pay back the interest. Interest must be some kind of factor in growth, but not to the extent you put it.
manchovie 2 years ago
An interview I did with Richard Douthwaite explains another mechanism by which debt based currency itself (not the interest) is a core driver of growth. Google "Richard Douthwaite Adam Fenderson interview" (without the quotation marks) to find it.
manchovie 2 years ago
Manchovie,
You are absolutly correct. This video is wrong.
Acrobat747 2 years ago
Thanks for your comment, manchovie, it made me think more deeply about the issue. I think that you've omitted the fact that bank profits are also loaned money (from FED or banks themselves) because the system does not have a source of interest-free money. Thus I believe the video is correct.
dsfkjdslkgnalerfe 2 years ago
1) Money can only be created by loaning it
2) -> All bills are debt for an amount larger than their face value
3) -> To pay back the loans of creating all the money in existence, we need more money than exists
4) -> We need to create new money
5) GOTO 1
dsfkjdslkgnalerfe 2 years ago 2
Very good loop Program.
swamiaman1 2 years ago
Hope everyone's paying attention.
kritik6 2 years ago
john f kennedy bought in his EXECUTIVE ORDER 11110 to get rid of the federal reserve america bring it back john f kennedy for america
duchesseagle404 2 years ago 2
correct me if im mistaken but isnt this very similar to zeitgest?
stevieisseraph 2 years ago 5
Debt can be paid back with interest without needing more money to be created:
spreadsheets (dot) google (dot) com (slash) ccc?key=p7jSfNelm7FDJ47ek1DvxEQ&hl=en
gregcopenhaver 2 years ago
But goods creating also create value. If the world keep creating new goods as fast as money is created the money will keep its value.
Anyway, goods ccreating never would be that fast.
CHB1285 3 years ago
Why do you think the media and government keep pushing people to borrow more money.
It keeps the system working.
CosmosPrivateer 3 years ago 3
So China et al do not hold Treasury Bonds like the Main Steam Media tells us...the Fed does. Is that correct?
jcpubs 3 years ago
As I heard it, the Fed creates Bonds which are sold to China et al. in return for cash. I think the Fed can later buy back those bonds but in the process increase the money supply and increase inflation. Does that sound right?
StephenWard9 3 years ago 2