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If you have not already watch Arron Russo's movie America, From Freedom to Fascism Please do now. Find out more at http://www.freedomtofascism.blogspot.com/
would be a better course of action
http://www.khouse.org/articles/2006/640/
http://journals.aol.com/kweinschen/Veritas/
Congress should be in control of US currency not a private company. If congress was in charge we would no longer have to pay interest on the money borrowed. It would save the tax payers billions in a few years and trillions over time.
I'm not sure how you imagine anybody could borrow money at no interest rate. The overnight counter rate set by the Fed dictates only what interest banks pay at an annualized rate when they come to borrow money (overnight) if they don't meet the deposit reserve requirements. The free market determines the interest rate for the rest of us; when a company wants money for a certain project, the market prices it according to a borrowers credit risk, expected ability to pay, expected rate of inflation over the life of the bond, and other factors to determine the interest rate (which is a function for the price paid for the bond, the coupon rate, or monthly payout, remains the same).
You'll always pay interest because of opportunity cost; the people that give you money could be doing other productive things with that money other than letting you have it just out of the goodness of their great big hearts. There's a hundred other reasons why your statement was off, but I won't do what a highschool econ teacher should've done for you over the course of a semester.
Background:
On the Greed Show on Fox TV, 02/11/2000, it was determined that we would need $454 today to buy what $100 would buy in 1969. This comes to 5% compound interest inflation.
There is way to falsify our inflation rate other than outright lying. This is called the Quality Adjustment Method. This is a gimmick that says there is an “improvement in quality” and they can say such a percentage of some increase in inflation is really an improvement in quality and, therefore, not inflationary.
In 1947, my weekly salary for an entry position at Eastman Kodak Stores was $23:
In 2024, at 5% compound interest inflation that $23 becomes $409 or $10 an hour. The equivalent salary would now be $409. This is par. Notice there is no value for productivity. In fact, it looks like the productivity has been deducted. The purchasing power is about 1/18 of the original $23 less the productivity increase for the intervening years.
In 2024, at 5% compound interest deflation that $23 becomes $1.12. The equivalent salary would now be $1.12. This is par for 5% increase in productivity a year. The purchasing power increases by a factor of 20. $23 now has 20 times the purchasing power of $23 in 1947.
The above weekly salary paragraphs are a general guide. To see more of the enormity of the falsity of the Federal Reserve debt and interest money system, ask for the catalog or publications list:
Monetary Science Publishing
Box 86
Wickliffe, Ohio 44092-0086
These 4 groups of experts, who seek the truth and what is best for our country, must cooperate to bring this forth:
ACCOUNTANTS: to keep, audit and inspect the financial records of the Federal Reserve debt and interest money system, and report to the public.
STATISTICIANS: to collect, organize and interpret the numerical data.
MONETARY EXPERT: understands and is able to create a debt-free Constitutional money system to replace the Federal Reserve debt and interest money system.
(Peter Cook, M.Sc., C.M.E. from Monetary Science Publishing)
ECONOMISTS: deal with production, distribution, development and consumption of goods and services; economic condition.
Good job Richard. I do have something else to add about our inflation rate. Between 1913 and 2024 our inflation rate is 2024.375%! It was fairly level for decades but took a steep climb during the past 30 years. My daughter went to Penn State University for 4 years. I became interested in the ton of tools they have available on their site as a result of my daughter being a student. Those tools are available for anyone to use wether or not you're a student and can be found here: http://www.libraries.psu.edu/gateway/referenceshelf/
One of the tools I found very usefull in calculating our inflation rate is on that site. It's a third party link which lets you know the value of your money from 1790 - 2024. This is how to find that link:
http://www.libraries.psu.edu/gateway/referenceshelf/
under Almanacs, Fact Books, & Utilities
click on Calculators & Converters
then go to Five Ways to Compute the Relative Value of a U.S. Dollar Amount, 1790 - 2024
that will take you to this site: http://www.measuringworth.com/calculators/compare/
Initial Year *: (I entered 1913)
Initial Amount: (I entered my sons current salary 250000)
Desired Year *: (I entered 2024)
I left everything checkmarked and got these answers:
In 2024, $250,000.00 from 1913 is worth:
$5,085,937.50 using the Consumer Price Index
$3,824,287.65 using the GDP deflator
$10,396,281.36 using the value of consumer bundle
$21,955,307.26 using the unskilled wage
$26,131,896.44 using the nominal GDP per capita
$79,559,274.40 using the relative share of GDP
Using the Consumer Price Index figure, you get an answer of $5,085,937.50, with that amount being what you would have needed to = the purchasing power that $250000 had in 1913, in 2024! When you divide 5,085,937.50 by 250,000 the answer is 20.34375. Converting that figure to a percentage rate by moving the decimal point 2 places is how I arrived at our inflation rate since 1913.
1913, coincidently, is the year of the Federal Reserve Act and also the first year of Federal Income Tax! Which, by the way, through the wording in the IRS Code, IS ILLEGAL when being applied to our wages!
More information can be found here: http://www.wethepeoplefoundation.org/
Inflation is dependent on the basket of goods used. The basket used on "greed" is more likely to be biased than the standard baskets used for these calculation. The BLS uses a basket of goods that is meant to mirror an average households consumption for the CPI. Obviously quality is important because the car I buy today is not the same car as I bought in 1950: gas milage, safety, performance and durablity are all better. Today we spend money on computers, software, internet, cable... each of those services are MUCH better than the 1980 equivalent and were not available in 1950. All of these elements come into play when you try to establish a "fair" standard for inflation.
You could make up a shopping list of things that make up a small fraction of my budget and get outragous numbers for inflation. Your end assumption would have to be that people were better off in 1947 since they would have made more money then. Please find me the people who want to give up their electronic life style for 3 channels of black and white tv and prop airliners.
Check out this link if you are not yet convinced.
The reporter that did this story is named John Pilger he is a very credible person.
I hate pork, you hate pork, but we got pork! Before we can abolish the FRB, we have got to prevent Congress from getting their hands in the till. A real overhaul of the budget would have to include specific budgetary guidelines, no subsidies for failing business sectors or sell outs to foreign interests: no store--no income, no income--no tax base. I wonder if Congress gets it.
Everybody loves their pork but hates the other guy's pork. Everybody seems to like their Congressmen but do not like Congress. Everybody hates the Special Interests but probably belong to one of those with offices on K St (check your checkbook!). Let's hear it for cognitive dissonance folks! So we need to own up to our complicity in this if we are ever going to solve. remember the first step in the AA 12 step - acknowledge you have a problem. And we need to start with ourselves if we are to be honest! The Congressmen and earmarks were NOT dropped upon us from Outer Space. We empower them and the lobbyists/PACs/Special interests that really run this town here in DC! The problem dear Brutus is NOT the stars but us!!
Pork! The FRB?? Bank/Reserve? How can it be when there is nothing to BACK our American Dollar??!!! We LOST our Federal Reserve of GOLD, years ago!!! How??? Euro Dollar!! It was sent there to BACK the start of the European Dollar, what did we get out of that deal??!! A President who can't destingush between SEX, and can't lie, GAVE our reserve AWAY!
http://www.usatoday.com/printedition/news/20070529/1a_lede29.art.htm
It makes me sick to see destruction of our once prosperous country. According to the USA Today article the federal gov't lost $1.3 trillion last year far more than the official $248 billion deficit. Part of the solution to this madness is to lop off entire branches of the federal gov't and the Federal Reserve. The assets of the Federal Reserve and their members should be confiscated and handed over to the Treasury, then a return to Constitutional money and elimination of the debt based money system.
On this issue Bookmark this site - http://www.facingup.org/
HC - THIS is exactly why Comprehensive Entitlements Reform is Issue #1 that needs effectively addressing in the next 4 to 8 years. ALL other issues such as immigration, energy policy, environment,education,etc pale in comparison and are "feel-good" issues compared tothis entitlement one. If we cannot address this #1 issue we will not be able to sustainably operationalize a solution ANY OTHER issues that might come our wayor that willneed addressing. So first things first - we need to address Entitlements #1! I do not subscribe to your extreme solution suggested there HC, but you ARE correct that THIS is THE issue! We ignore at our nation's peril!
DC - 3rd ward - milligansstew08@yahoo.com
http://milligansstew.blogspot.com
Ther problem is the debt money system and the unsustainable debt we are facing. The debt money system must be repalced as it is what allows the gov't to spend money they don't have and to pass the debts they create on to future generations. But the gig is about up as the dollar is nearing the fate of all unbacked fiat paper in history, utter and complete failure. All countries who have faced this problem before have had two options hyper-inflation or massive deflation. All of them opted for the hyper-inflation which was followed by the deflation (depression). As for entitlements they need to be eliminated period, with provisions made for those too far along in the system already.
Global inflation is now running over 15% per annum with no signs of slowing down. Shadow stats dot com is saying that M3 (total money supply) is increasing at over 12% in the US now which translates to at least 12% inflation.
We are at critical mass now! the BIS (bank of international settlements) says that total global derivatives in now $415.2 trillion or 789% of global GDP. This is unsustainable. It takes over $2 billion per day of foreigners buying our debt to keep us afloat, and they have stopped buying because of the low interest rates here. The Fed is in a pickle, they can raise rates and save the dollar and thus ruin what is left of housing and the economy or they can cut rates in an attempt to salvage the domestic economy and thus deliver the death blow to the dollar.
No one here likes to hear this but the only candidate with a clue as to how to salvage this situation is Ron Paul. He is by far the most economic literate of all the candidates. He understands how the American public has been robbed by the gov't and the Federal Reserve and more importatntly how we can at least try to correct the problems.
On a side note John, I hope you can recall the website that I posted and we discussed briefly a couple of weeks ago. There is new breaking news there that I think you may be very interested in.
Ron Paul is the only candidate who fully understands this problem!!!
check the video!:
An independent central bank provides the best possiblity for a low inflation fiat currency. Perhaps the Fed has a bit too much freedom and should go to a inflation targetting primary mandate, but even without this mandate the fed has been fairly successful at controlling inflation. Inflation has been a reasonable levels for a long while now. Giving congress power over a fiat currency is stupid: Britain and New Zealand both had significant "congressional" control of their currencies and had horrible inflation until they provided inflation targetting mandates and greater independence in the 90s, since that time there has been very low inflation in both countries.
If you want to go back to the gold standard, you must realize the risks:
1)Dependence on the gold market: currency that is tied to the whims of the gold mining industry. There was actually huge inflation as a result of gold discoveries in the 19th century. Questions about industrial demand for gold also come into play as gold is an important commodity.
2) Loss of the use of monetary policy. Monetary policy is the only macro economic tool which can be readily used with some effectiviness in order to respond to business cyles. While it may not be completely necessary to respond to most business cycles, it is a nice tool to have in the box. There are plenty of academic papers discussing the different channels through which monetary policy can be effective.
3) Loss of protection against financial shocks. The Fed has a history of successfully being the lender of last resort. The feds ability to lend after 9/11 allowed our economy to avoid financial crisis as a result of losing a financial center. Something like 200 times the normal loans were made that week. Similarly, stock market crises drops have not sparked financial crises in this country. Over the same period of time, many countries around the world with various banking systems have had financial and banking crises.
4) Flexible exchange rate. Having an exchange rate in response to the asset markets and fundamentals allows the market to work. We have a large current account deficit and the dollar is losing value: this is a good thing! Our currency loses value and there will be more demand for American products by both Americans and foreigners. This is how the market fights "outsourcing".
On treasury bonds:
1)People want to hold American bonds because they trust the stability of our economy and government. If anything, the problems begin when they stop eating up our bonds.
2) If the bottom drops out of the bond market that could be really bad for everyone everywhere. In good news, no one serious really believes thats a threat at the moment. We do need to deal with some issues of budget over the next 10 years, but it isn't anything our economy can't handle.\
3)If things go badly, they'd probalbly be worse under a hard money regime. If there are pressures to devalue the currency in a fixed currency regime, there can be speculative attacks and the collapse of the whole system. In a fiat system, a some inflation is better than the loss of the banking system. Clearly inflation is never a long term solution, but it is a tool if the crap hits the fan.
No where on this page do I see a full outline of the arguments for killing the FED. I really shouldn't have taken you seriously to write up this response. Ron Paul's arguments weren't very convincing: I really don't get his concern with fiat money: he just seemed to feel it is without value, something consumers prove wrong every day. He seems to think that it is less stable which largely goes against our experience since going to fiat money. He talks about inflation as if it is currently a huge problem: the cost of 2%-3% inflation is minimal and consumers take it into account while making decisions. He completely glosses over the finer points of how the fed has used monetary policy and simplifies the monetary model to a point where it doesn't line up with the data. There was an incredibly weird shift in monetary behavior (currency holdings going up for example) and velocity of money was all over the place in the 90s. Ironically over the same period, inflation wasn't unusual-- the fed was doing something right.
Final argument: Politicians are economic idiots. Britain has a panal of economists who advises on all policy issues while here in the US the FED is the only real voice of economics. If you feel that economics is crap, than don't pretend to use it to defend policy. If you feel that perhaps having economic professionals on the dole is an intellegent move, getting rid of the FED isn't very smart. The dismal science has progressed with mathematics and technology, yet most congressmen and their speech writers mix and match elements of 40 year old models which are not supported by data. Call me ivory tower, but it seems like designing economic plans would be a good time to call for a bit of ivory. It is nice that there is one organization in government where professionals can work largely without political pressure. Killing the fed is akin to killing that national wealther service because weather alerts tend to cause panic (at least from the information lost perspective).
The Federal Reserve is a PRIVATE BANK that charges us interest on every dollar they print. This system has only one objective...KEEP AMERICA IN DEBT. Comparing it to the National Weather Service is flat out STUPID...because the weather service can't control the weather unlike the Federal Reserve which has total control of OUR MONEY. Do you really think it is the Fed's interest to provide less money or debt to US? NO!!!!!! Why do you think we have had almost constant war and debt since 1913? Both provide profits for the PRIVATE BANKS.
You talk about inflation...well how about this. The US dollar now buys $0.05 of what it bought in 1912! I would call that obscene inflation and the primary reason people have to work multiple jobs to survive despite productivity gains from technology.
Just like your bank doesn't have YOUR interests in mind when they set their policies neither does the Federal Reserve.
And without the Fed it would probably take $1,000 to cover what our 1912 nickel would probably buy today. Get out the wheel barrels. Nope! I'm sorry! Americans keep america in debt do not blame the Fed for that. They are just trying to keep our accumulated public/private irresponsible profligacy in some sort balance/check. Thank God for people like Paul Volker, Alan Greenspan, Alice Rivlin, Bernanke - without them this country would really be sucking wind BIG time much more than it is now!
DC - 3rd ward - milligansstew08@yahoo.com
http://milligansstew.blogspot.com
No fiat paper money in the history of the world has survived and the dollar is on the edge of the proverbial cliff right now.
The Fed talks about fighting inflation when all they can do is inflate. They can do nothing more. It was Alan Greenspan who made the easy money available to people who could not afford to pay it back and caused the housing crash we have only seen the beginnings of so far.
By the way does anyone know where Greenspan is right now? He has been rather quiet in the last three weeks. It must be hard to communicate from his present residence.
We are living in an era of prosperity that is unprecedented in human history - not bad for "fiat" money. The problem is keeping it in balance and the Fed has done pretty good to do that given the public/private forces (and political pandering by BOTH parties) pressure to inflate and borrow-borrow-spend-spend. Actually inflation is pretty darn low compared historically.
Thank GOD for Volker, Greenspan, Rivlin, and Bernanke!!! The problem is NOT the Big Daddy Fed but our panderbear politics and us - the big spenders who want our cake and eat it also. "The fault Dear Brutus is us and NOT the Stars"
DC - 3rd ward - milligansstew08@yahoo.com
http://milligansstew.blogspot.com
All money eventually returns to it's intrinsic value, which in the case of paper is zero. It is now real close to that value and sinking.
The dollar is not what it onece was for sure but do not blame paper and gold would be a deflatonary/depression assuring disaster. Rather what we need to focus on is promting a Savings/Endowment Society and policies therewith and STOP promoting this inane pandering Entitlement Borrow-Borrow/Spend-Spend Mentality that has taken hold in the last 40 years (and last 20 esp). Will take a LOT of True political courage to reorient this ship. Savings focus is they key not the metal or cellulose backing. Must be done though to add a Century or 2 to the life of this blessed republic!
DC - 3rd ward - milligansstew08@yahoo.com
http://milligansstew.blogspot.com
In 1787 Lord Mayer Rothschild (you know the Bank of England) said "Give me control of a nations money supply and I care not who runs the country or even what form of government it has". What do you think he meant by that?
Do you have any clue about US history? Do you know what the big fight between Hamilton and Jefferson was about during the first 25 years of the USA? Hamilton was a New York Banker and wanted a PRIVATE central bank. Jefferson was determined not to hand control of the country back to The Bank of England and luckily he won...temporarily.
The Private Banks tried all through the 1800's to set up a PRIVATE central bank. They had managed to buy enough congressman by 1913 to get their wish and the UNCONSTITUTIONAL Federal Reserve was created along with the un-ratified 16th amendment which created the ILLEGAL INCOME TAX to pay interest to the Private Banks. Gee what a surprise we have had one debt producing war after another every since.
TURN OFF THE FOX NEWS AND DO SOME READING SCHMUCK!
You can complain about the Federal Income Tax and the FED all you want. The fact of the matter is, they are there. Stop being an a$$hole to people who hold a differing opinion. He's not resorting to calling you names.
Now, back to the argument. You want to quote American history. Don't forget who won the argument between Hamilton and Jefferson. Hamilton found widespread support for his plan, even among people who were close to Jefferson. Jefferson has support as well, but not to the same level. That is why, as soon as Jefferson was gone, the country moved in the direction it WANTED to go in.
With our economic system the way it is, the FED has to stay. It is the least of a mountain of problems. If you look at WORLD HISTORY, you can see that the system the U.S. has is not all that bad. We've had only one or two major economic crises since 1913. Look at any other industrial nation, and they have had many, many more.
The FED has government over site, and it (for the most part) acts in what it considers to be the best interest of both individual Americans and the American economy, which sometimes needs more protection than the individual.
The Federal Reserve steals the wealth of the People and the nation through inflation and deflation. It is the Fed (Alan Greenscum in particular) that has created the subprime mortgage crisis that now threatens not just the US economy but the world economy as well.
To suggest the Fed does what it considers is in the best interest of America and Americans is naive. The Fed does what is in the best interest of the Fed and in particular the owners of the Fed who's very identities are unknown to the American people.
The crash of 1929 is in hindsight going to look like a Sunday picnic compared to what the crash that lies ahead, probably before the year ends.
A return to honest money, and elimination of the fiat debt money system, as prescribed by the Constitution is necessary now. Every step away from true Constitutional government leads us further into decay, especially the debt money system that is a vulture offering credit. Credit implies debt and debt implies slavery. The debt money system is not compatible with liberty and freedom.
After every FOMC meeting all the economists wait with baited breath to see what direction the Fed is leaning toward on interest (usury) rates and what their outlook on inflation is. The Fed has discredited itself too many times. Everyone knows their numbers are bogus (PPI & CPI) and out of touch with reality. The MSM proclaims the Fed to be hawkish on inflation when in reality all the Fed does or can do is inflate, inflate and inflate some more. We are now at the doorstep of hyperinflation just like the Weimar Republic in 1929 and it will end in massive deflation (depression), it is inevitable.
The Creature From Jekyll Island is a must read for interested who, how and why the Federal Reserve stealing us blind.
The Revolution is not being televised but it is being youtubed!
Join the Ron Paul Revolution and eliminate the Federal Reserve!
Isn't the Economy always the main issue?
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Government provides the mandate and appoints the board of govenors. Individual Federal Reserve Banks are owned by member banks and have boards made up of people from banks, the private sector and the fed.
Realize that financial crises were common before 1913: we've had one since then.
The federal government does not have total control of our money. They are mandated by congress and congress can adjust that mandate whenever it sees fit. The fed is fairly transparent as to what it does to the money supply: you can find daily listings on there website for many indicators.
Price levels are different from inflation. According to most monetary theory money is neutral, therefore it really doesn't matter what prices are. Inflation is the change in prices. I did some quick math and your average inflation rate is 3.2%. That number is hardly a tragedy and welfare effects of inflation at that level are minimal.
By all scales of measurement, the growth of REAL INCOME (inflation adjusted) has increased dramatically since 1913. Your current consumption whould have been possible in 1913 regardless of how many jobs you work.
Finally, the fed's profit is limited by congress and excessive profit is returned to congress. Characterizing the fed as a private bank is a bit unfair.
The Federal Reserve is an UNCONSTITUTIONAL PRIVATE MONOPOLY on OUR MONEY. Only CONGRESS, according to the Constitution, can regulate and print money. During Christmas vacation 1913 a few crooked members of Congress were bribed into creating the Federal Reserve Bank as well as the as yet un-ratified 16th amendment which created the INCOME TAX to pay the interest on the money printed by the Fed.
These criminals completed their takeover of our monetary system in 1933 when the Fed took America off the Gold Standard. Not coincidentally the "All Seeing Eye Pyramid" symbol showed up on the dollar in 1933...they were telling US they now own our stupid asses.
I'm guessing those here who think this is a good idea are the ones taking out second mortgages to pay their credit cards. AKA MORONS! Every dollar these criminals print costs US $1.33 with interest. In case you haven't noticed the country is BANKRUPT...we can't even pay the interest to our Corporate Bank Masters.
Lord Mayer Rothschild (primary owners of the FED) said "Give me control of a nations money supply and I care not who runs the country". What do you think he meant by that?
The last guy to make a serious attempt to abolish this ILLEGAL MONOPOLY was John Fitzgerald Kennedy! Gee I wonder if that had anything to do with his murder?
Oh yeah...by the way the almighty US Dollar now buys $.05 of what it bought in 1912 the year before the Federal Reserve was created.
If you want to trash our entire society and rebuild on a different model, at least be honest enough to come out and say which one.
I agree. To say that our whole economic system is so far off whack is to ignore the fact that we have been the largest economy in the world for much of the last 100 years. You people claim that the FED and the income tax are the worst things to happen to the economy of this country. Find me one, just one example, of a country that runs on the system that you would suggest, that has been more economically stable over the last 100 years, and I will never post in this thread again. I don't think you can, but I wouldn't mind being proved wrong. Show me proof, and I'll listen. Mindlessly harass other members for their opinions, and you not only tick people off, you make them opposed to your idea.
Oh yeah, and by the way perkwya, I have immaculate credit. To generalize that those who don't agree with you are those who don't know anything about economics or budgeting is just plain ignorant.
The problem isn't the Fed, its us, sorry perkwya. We, as consumers, drive ourselves into debt with credit cards and such without the help of the federal reserve. The Fed keeps the economy stable. We also ascended onto the world stage as a "World Power" shortly after the creation of the Fed. yea, the fed is evil, we've only become the strongest and richest country in the world since it was created. but lets abolish it anyway? and after reading this thread, i've noticed that perkwya, you just used the same argument in every post. sounds like your just repeating some anarchist type propaganda over and over again. The debt caused at the government level is because our government is just two massive and spending too much and taxes are too low to support it. The answer isn't to raise taxes. It would be to cut a lot of the Entitlement programs (slim chance of that happening though) and drastically reducing military spending. The cold war is over, and terrorists cannot be fought with an army (exibit A: Iraq). the obscene military expenderatures are just the result of the military industrial complex. So, we really just need to start cutting programs. i dont think we need a defense budget greater than that of all the other industrialized nations in the world combined. are we expecting hitler to attack us from space or soemthing? haha. Also, when we had a gold backed currency the economy was very unstable. Fiat money stabilizes it.
I agree with everything you've said. The key to fixing the national deficit/debt is reduced military spending and the elimination of pork/overspending.