Sunday, January 4, 2009

The Currency Scam

(Before reading The Currency Scam, please read What is Money)

If you understand the difference between MONEY and CURRENCY, congratulations, you are one in a million according to
Vladimir Lenin:
"There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose." - Vladimir Lenin, as quoted by John Maynard Keynes
Lenin was saying that almost no one realizes that CURRENCY is a major variable in their lives. Most people simply do not recognize that CURRENCY undergoes wild swings in buying power, carefully imposed by powerful interests to steal away their wealth--routinely, systematically, and ruthlessly. How does it work? How do the powerful systematically steal wealth from under your nose?

The Currency Scam.

Perhaps since the dawn of civilizations, there have been Money Changers. Many will recognize the derogatory term "Money Changer" from the Bible. I'm not sure how far back you can carbon date the act of "Money Changing" as a recognized scam, but the first well documented instance, that I know of, was related to the assassination of Julius Caesar in 44BC.

Caesar's death enabled Money Changers to corrupt and debauch Rome's hard money for private profit--it was downhill from there. Jesus famously upended the tables of the Money Changers, relatively soon after:
He overturned the tables of the money changers. 'It is written,' he said to them, 'My house will be called a house of prayer but you are making it a den of thieves. - Matthew 21:12-13
We'll hear the term "Den of Thieves" again, as young America struggles to throw off her second generation of parasitic Money Changers in the 1830's.

What is a "Money Changer?"

Wikipedia defines Money Changing as "a trade involving exchanges of coins in different denomination. It is thought generally to be the origin of modern banking in Europe."

What a laugh. Somehow I don't think Jesus submitted himself to death by crucifixion to protest honest currency exchange. No, Money Changers do something that is distinctly criminal but often not technically against the law. That is because the law itself operates on the assumption of a stable currency. If it didn't, the Money Changers would create enough CURRENCY to change the law.

Money Changers exploit the largely unrecognized difference between CURRENCY and MONEY. They have done it in a variety of ways, but their method de jour is what we call "fractional reserve banking." We'll get into the precise mechanics of fractional reserve banking later, as it is critical to understanding why the the stock market is falling and will continue to drop. For now, let's stick to identifying The Currency Scam and how it steals away your MONEY.

As we know, the CURRENCY supply relative to the MONEY supply = PRICES. The MONEY supply is not easily manipulated. Contrary to the slippery words of our Federal Reserve Chairman, one cannot print money. It is an absurd notion that one can "print" a house, or a car. What can be printed (or burned), quite easily, is CURRENCY, as any petty counterfeiter will attest.

The act of flooding the market with CURRENCY is known as INFLATION. The act of draining CURRENCY from the system is known as DEFLATION. As we identified earlier in What is Money, the total CURRENCY supply divided by the total MONEY supply yields our current PRICE levels.

So:

INFLATION is the act introducing more paper currency into the system, causing prices to rise as new paper competes with old paper to buy existing assets.

DEFLATION is the act of draining paper currency from the system, causing prices to fall due to currency starvation (ala our current real estate and stock markets).

So "Money Changers" quite literally change the price of MONEY by willful manipulation of the CURRENCY supply. This handy little trick is not magic, to the contrary, it is a trivial feat in any system that allows fractional reserve banking.

Most people think of INFLATION as an accident, or some sort of natural phenomenon of macro economics. Oh, how wrong that is. We account for every penny in routine transactions, and errors offset. INFLATION must be introduced by an act of malice. It's measurable existence is the smoke produced by a simmering fire of hidden crime.

How does INFLATION impact you? Simple. By printing more CURRENCY, the Money Changers simply purchase your MONEY from you, causing all prices to rise. As prices rise, things become less affordable, which in turn ratchets down your standard of living. You've been scammed.

But as bad as intentional INFLATION sounds, in a country that is supposedly honest, forthright and free, it pales by comparison to the DEFLATIONARY scandal the Money Changers have in store for you. After they steal your wealth by INFLATION, they cut you off at the knees with DEFLATION. Once INFLATION causes prices to rise, people have no choice but to adjust to the new price levels. Unless you refuse to live in a house, you have to pay the price of a house. Same goes for cars, energy, food, everything. You are trapped if you must conduct trade in their currency (that is why they always want to consolidate currencies, like the Euro). INFLATION also means that the price of DEBT notes goes up. Instead of a $3,000 mortgage in 1932, we now have $300,000 mortgages. The existence of INFLATED DEBT notes presents the Money Changers with a uniquely profitable opportunity: DEFLATION.

The scam is almost complete. INFLATION has run its course, now it is time for DEFLATION. With society hooked on high priced DEBT, a sharp drop in prices is catastrophic for the borrower. Given DEFLATION, a $300,000 home falls to $150,000, drowning the borrower $150,000 underwater. His wages fall, or possibly disappear, causing the INFLATED PRICE of his DEBT note to become more and more of a burden. Additionally, lower prices across the board increase the VALUE of future interest payments. Eventually, borrowers break, and their homes, cars, savings (their MONEY) is seized by the Money Changers.
If the American people ever allow the banking system to control their money, first by inflation, then by deflation, their children will one day wake up homeless on the continent their fathers conquered. - Thomas Jefferson
Who are the modern Money Changers?

The answer is another question: Who holds the keys to INFLATION and DEFLATION in our financial system?

The answer: The private Federal Reserve corporation.

8 comments:

  1. That guy was "Vladimir". I know - I am russian. Wazi

    ReplyDelete
  2. Nicely put, succinct and clear. Do you think that FDR#2 will "fix" the current mess we are in as FDR#1 was credited for in the reality check of that time period?

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  3. "Do you think that FDR#2 will "fix" the current mess we are in as FDR#1 was credited for in the reality check of that time period?"

    I don't think any "FDR" (a harbinger of unimaginable new debt to create an orgy of perpetual private bank profits) happens by accident.

    So yes, chances are FDR #2 either willingly or by historical ignorance will cause multi-decade Great Depression #2, again transferring most of America's wealth to private banking interests.

    ReplyDelete
  4. I'm a little confused about this:
    Article 1 Section 8 grants congress the right to coin money and establish weights and measurements but I find Section 10 a bit more enlightening.
    I'm not really sure how to interpret this and I think the framers either overlooked something or bowed to political pressures of the time.

    Section 10. No state shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts; pass any bill of attainder, ex post facto law, or law impairing the obligation of contracts, or grant any title of nobility.

    I don't get it. Congress can coin but if you are in a state only gold or silver coin may be tendered in payment of debt.

    So, how do you interpret that?

    ReplyDelete
  5. "So, how do you interpret that?"

    Article I Section 8 says congress (the people) shall (legally meaning "must") coin our money. Further, it states that all Federal money must be backed by gold and silver, which was later expanded to include copper.

    The Framers knew that MONEY was the key to a stable currency, not un-backed paper, or other non-valuable metals, like the relatively worthless Zinc LBJ switched into our current coinage.

    The Framers forced congress by law to "coin MONEY" with valuable metal, as opposed to "print CURRENCY" on worthless materials. Their words were carefully chosen.

    Article 10 simply consolidates that power at the Federal level. I think that was a mistake, but they were trying to keep a handle on quality money, after being burned by the counterfeiting facilitated by the poor choice of pewter in the Continental Dollar.

    Today, the US Constitution is simply ignored, and our paper currency is printed by a cartel of private banks for their private profit. The private central bankers who print our nation's paper currency haven't even bothered to change the law, they simply break it, and buy congressional complacency/advocacy using the very paper they print.

    Today, we have the precise arrangement our Constitution was carefully written to prevent, and the reason the American Revolution was fought.

    ReplyDelete
  6. Senate just approves 1.1 trillion spending bill. When government spends money like there is no tomorrow don't you think US economy is headed toward hyperinflation due to diluted dollar?

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  7. "don't you think US economy is headed toward hyperinflation due to diluted dollar?"

    Government spending strengthens the dollar. It costs more than it wastes, it transfers 2.5X as much interest to private bankers as it injects, and worst of all it burns commercially available private credit by reducing personal and corporate income.

    Remember, private banks issue our currency for enormous interest profits and huge fees, not the government. All deficit spending is nothing more than a transfer of wealth from the poor to manically rich.

    ReplyDelete

The USA's political-economc system is best described as:

On Nov 2, 2010, I plan to vote (FOR or AGAINST) my incumbent congressman

 
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