Let’s examine, in simple terms, how the banks work. Pay close attention to see if you can find under which shell the pea (real money) is hiding. 😉
If I were to loan you $100, my assets would decrease by $100. But, when a bank or other “lending” institution loans you $100, their assets increase by $100! Huh? That’s right, when banks make loans; they accept promissory notes in exchange for credits to the borrowers’ transaction accounts. Loans (assets) and deposits (liabilities) both rise by the amount of the loan. So, when was the last time you loaned money to a friend, and suddenly you had more funds? (trick question)
Accepting Your Promissory Note
So, “lending” institutions (including credit card companies) accept promissory notes in exchange for credits to the borrowers’ transaction accounts. What exactly does that mean?
This means that they add money (they credit money) to your checking account, but not the one that you know you have. The funds for the addition to the “secret” account came from depositing your promissory note! (Except the credit card companies actually deposit your application/agreement – and monetize it even if you are not approved! Again, you provide the source of the funds that are deposited into your account.)
How can they do that? Because they’re banks. Your promissory note, is a note.
Federal Reserve Note
Look at a dollar bill. It says “Federal Reserve Note” on it. A note is legal evidence of a debt or obligation. Thus, a “note” is “owing money.” That means what we call “money” or “cash” today is really owing money.
So, since “money” means “owing money,” and your promissory note is “legal evidence of a debt or obligation” (owing money), your note counts as “money” and can be deposited. Still with me?
All they’ve done is converted your promissory note into “funds” that they then “loan” back to you. And now you have to pay them again, plus interest? Say what? Where in the agreement does it say that you are providing the value (through the promissory note that they received from you) to fund your own loan? Is that a mutual intention? Is that what you agreed to?
Money is such a routine part of everyday living that its existence and acceptance are ordinarily taken for granted. You might think money comes into being either automatically, as a result of economic activity, or as an outgrowth of some government operation. But just how this happens often remains a mystery.
Luckily, the Fed (Federal Reserve System and its member banks in the USA, or any other country’s central bank) will soon solve the mystery for us! In the United States, neither paper currency nor deposits have value as commodities. Intrinsically, a dollar bill is just a piece of paper. Coins do have some intrinsic value as metal but generally far less than their face value.
So, why do we, the people, accept these instruments (i.e., checks, paper money, and coins) at face value in payment of debts and other monetary uses? The reasons are:
- According to the Fed, it is the confidence we have that we will be able to exchange such money for other financial assets and real goods and services whenever we want. Really?
- It is partly a matter of law. Currency has been designated “legal tender” by the government, i.e., creditors must accept it in payment of money debts, and paper currency is a liability of the government.
- The assets that exist on the books of the government (or central bank) and the depository institutions are equal to the amount of money outstanding. This is true even though most of these assets are no more than pieces of paper.
“Money” is anything people accept, but (returning to the mystery) we just saw that “money” is not a thing, it’s just bookkeeping entries, pictures of dead presidents, and essentially valueless coins. And exactly who/what is it that creates this No Thing used as money today, internationally?
The actual process of money creation takes place in the banks. The Federal Government, with the cooperation of the Federal Reserve, has the inherent power to create money — almost any amount of it. This power makes technical bankruptcy out of the question.
The reason we no longer have gold and silver coin is because they wanted to transition us from using the money we produced and instead make us dependent upon the money they create! “Money” with the force of law; “Money” you only have IF your banker says you do! We don’t need a government to tell us to accept silver or gold coins but when it comes to bank “fiat” money?
What About Credit?
Okay, isn’t “CREDIT” what we use when we don’t have any money? Isn’t it something we apply for and get from, say a bank, after we first prove to the bank we don’t need it? You know, you’re a little short of cash right now, but you’d like to have that new car so you ‘buy it on credit’, right? WRONG! When you buy something “on credit” you are incurring a debt. Thus, credit is debt! This means our system works only with debt.
On June 24, 1968 Congress removed the last known THING, i.e., silver coin, that was used as money in the United States. Although some THING should have replaced it, in fact, it was not replaced by a THING, rather it was replaced by credit, which is debt, which is monetized debt, which is what we now call MONEY!
Not only did that Act of Congress eliminate our payments mechanism, it also established the greatest confidence game in history. The “leaders” in 1968 knew something had to be done, for if a bad check is one that is not redeemable, why isn’t a currency that is not redeemable bad currency? Currency backing isn’t relevant in today’s economy. Currency cannot be “redeemed” or exchanged for Treasury gold or any other asset used as backing. The question of just what assets “back” Federal Reserve notes has only bookkeeping significance. Unfortunately, there is no “pea” (real money) to be found because all the shells are empty. ;(
Could It Be?
Could it be that because you THINK you have money, your banker agrees that you have it, and you THINK you are paid and, therefore, you THINK you are free? Could it be that simple? By the way, the US Treasury owns no gold and hasn’t since August 1975. SERIOUSLY?
THE COMPUMATRIX SYSTEM
Compumatrix is, in short, none of the above.
In Compumatrix, you are your own bank; transactions are peer-to-peer; the system is not controlled by one entity (it’s decentralized); the value of the cryptocurrency assets is determined by the marketplace (i.e., the people); _______________ (fill in your favorite features/benefits).
SIGN ME UP!!!