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In the years leading up to its creation in 1913, the architects of the Federal Reserve System defined America’s “money” as a debt instrument. This is true of most, if not all, Western nations.
This means that “money, as currently defined, must be loaned into existence or it simply can’t exist.”
The lone exception is coinage, but it represents such a small proportion (2-3%) of the overall money supply that it can be disregarded in order to avoid unnecessary complexity.
Federal Reserve notes and all bank credit entries (the money owed to you by banks, credit unions, brokerages, etc. that is typically considered to be savings, checking and/or investments) are debt instruments.
A Federal Reserve note is, in essence, a debt receipt, just like a mortgage or car note. It exists solely because someone or some group, somewhere, owes it as a debt, along with its associated interest expense.
The debt it represents cannot be extinguished, by definition, until the debt receipt is destroyed and no longer exists. Once this fact is understood, it also follows that the only way for society to pay back its debts are to completely eliminate its money supply.
Put simply, a few people decided that society would be forced to “rent” its money supply from wealthy backers with motivations to wrest the control of the nation’s “money power” from government.
In so doing they re-defined the nature of money itself as a debt instrument and the right to control the issuance (debt) currency and credit.
In the case of the United States, these people are the interests that control the Federal Reserve System.
Positive Money UK has produced an excellent 3 minute video covering some important basics of a debt based monetary system:
Consequences of Fractional Reserve Banking 2) – Poverty – Debt is not a choice
Did you catch that the fundamental nature of debt dollar monetary systems essentially acts as a terminal debt “virus” that systematically expands its infection throughout society? By definition, one person’s monetary wealth is another person’s or group’s debt obligation.
Worse yet, the debtors can’t pay back the debt unless they can extract the debt dollars from their current owners. The best a debtor can do is offload the debt to some other individual or group of individuals.
I refer to this systematic, impersonal debt servitude engine as “Debt Dollar Tyranny” simply because that is the best description of it.
The leading cause of poverty in a nation afflicted under Debt Dollar Tyranny bondage is the monetary system itself and, to a lesser extent, those that become wealthy under this monetary tyranny. Their wealth is, by definition, everyone else’s debt servitude and poverty.
The more concentrated the wealth in a society, the more debts and usury the rest of society has to bear. Sit back and meditate on the magnitude of this fundamental economic truth they don’t teach in economics or business school.
Let’s look at a simplified example to better understand Debt Dollar Tyranny’s mechanics, for it is critical to understand the problem if we, as a society, are ever going to be able to craft a solution.
Mrs. Fed has the power to lend money into existence and, using that power, lends $20 to Mrs. Subject for a term of one year at 5% interest.
At the end of one year, Mrs. Subject owes Mrs. Fed $21, but Mrs. Subject has only been given $20 as part of her loan package.
Without the issuance of new debt money, there is only one way for Mrs. Subject to pay back her debt in full to Mrs. Fed. Mrs. Subject has to gain access to 100% of the interest paid to Mrs Fed in a timely manner and then use that money to pay off the rest of the loan.
This can be done by selling her labor or her assets to Mrs. Fed. Time is of the essence, though – earning the interest back after the final payment due date will still create a default.
In order to better understand this, let’s get into the mechanics of a successful repayment effort. Imagine that Mrs. Subject repays Mrs. Fed a total of $20 ($19 for principle and $1 for interest). If Mrs. Subject could sell her labor or assets to Mrs. Fed and earn back that $1 in interest paid to Mrs. Fed in time to pay off the loan, then she could pay off the loan in full ($21 total paid back = $20 loaned + $1 of interest paid to Mrs. Fed and earned back through some level of toil or asset sale).
That’s a pretty sweet deal for Mrs. Fed – she gets a servant or free assets simply because she rigged the monetary system, not because of all the so called “capitalist virtues” that surround her money lending operation as highlighted in the pamphlet Mrs. Fed handed out when she gave Mrs. Subject the $20 loan.
Also note a key aspect in this relationship – Mrs. Fed has complete control over whether to make Mrs. Subject’s loan unpayable. All Mrs. Fed has to do is withhold 1 cent of interest back from Mrs. Subject and the loan can’t be paid back no matter how talented, how creative, how hard working, how persistent, Mrs. Subject is during the loan time frame.
Mrs. Subject will only be able to pay $20.99 back and, therefore, will default on the loan with 100% mathematical certainty. Upon default, I’m sure that Mrs. Fed would then lay claim to Mrs. Subject’s assets that were used to secure the loan in the first place.
While this example is admittedly simplified, it is not overly so. This example does a good job demystifying Debt Dollar Tyranny and how it actually works at the “atomic” level. The complexity of our system overlays this “atomic” behavior, but it does not negate it.
If Mrs. Fed were satisfied to asset strip Mrs. Subject for $20, she may well choose the option of withholding some amount of paid interest and forcing Mrs. Subject into default under the terms outlined above.
However, If Mrs. Fed saw an opportunity to asset strip even more wealth, she would continue to issue even more debt money. This would make the first $20 debt easily payable and would tend to obfuscate the sheer insanity of borrowing money at interest from someone who could force one into default whenever it served the lender’s calculated interests. Of course, none of the actual dynamics have changed, they have just been concealed by complexity.
It is also worth noting that the central bankers’ put Andrew Jackson’s face on the $20 bill.
You know, the same Andrew Jackson that said,
“I killed the [central] bank” and “You [central bankers] are a den of vipers and thieves. I have determined to rout you out and, by the Eternal, I will rout you out!”
The idea favored by some of the poverty inducing uber rich oligarchs (their wealth is our debt, by definition!) is to set themselves up as “philanthropists” over the people that their wealth has impoverished. In this way, the impoverished can view the very root cause of their debt induced poverty as “good people” trying to help.
Martin Luther King addressed the fallacy of this view when he said, “Philanthropy is commendable, but it must not cause the philanthropist to overlook the circumstances of economic injustice which make philanthropy necessary.”
Whether Martin Luther King understood Debt Dollar Tyranny is the foundation of economic injustice or not, I do not know. But he hit the nail on the head. A philanthropist that doesn’t address the root cause of poverty, that is Debt Dollar Tyranny, is not much of a philanthropist at all.
We, The People, can’t resist this evil economic warfare model and solve this problem, unless we properly understand how it operates. Exposing the Federal Reserve System Debt Dollar Tyranny Trojan Horse to the masses and organizing an effective resistance is our only hope of avoiding Henry Ford’s prophetic words,
“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning. The one aim of these financiers is world control by the creation of inextinguishable debt.”
Once the root cause of our problems is properly understood, we can then, and only then, move on to develop a productive monetary system that fulfills Abraham Lincoln’s dream, that “money will cease to be master and become the servant of humanity.”
As for the “bailouts,” they are equivalent to Mrs. Fed keeping the $20 debt money receipt loaned to Mrs. Subject and then demanding Mrs. Subject pay the $21 in full in a year’s time – even though Mrs. Subject has no control over the money mathematically required to pay off the debt.
I’m sorry we have to be the ones to break the news to you but, no, the richest, most powerful people on the planet did not bail themselves and their multinational corporate front entities out in order to save the common person.
Rather, they did so in order to accelerate the inevitable bankruptcy that was planned for you, your community, your state and your nation as soon as this small cabal of international bankers were able to seize control of the the national monetary system through a covert Debt Dollar Tyranny coup in 1913 (the year the Federal Reserve Act was passed).
This information is critical. The people of the world can not properly understand the world in which they live unless they posses this critical knowledge. Why don’t any politicians tell us the truth? Why doesn’t the media tell us the truth? Why doesn’t the education system tell us the truth? Why don’t our religious leaders tell us the truth? None of these questions can be asked until one properly understands there is a critical truth that is being withheld from them – a truth that will bankrupt and impoverish their community, their state and their nation with 100% mathematical certainty.
Few things are more important to understand than Debt Dollar Tyranny and how it hurts our communities and is driving us all into bankruptcy – yet there is a near complete societal (media, education, politicial, religious) black out.
This means we have to share this information. We have to commit to understand how this system works and how it bankrupts its host nation. We have to share this information and break through the mega corporate “Berlin Wall.”
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