tooo damn funny...
Posted on 03/29/2008 6:48:20 PM PDT by ovrtaxt
oops....what I have are $2 red seal United States Notes...1953 series. : )
True, lol!
US Notes were issued directly by Congress, bypassing the Fed.
Imagine what would have happened to us if Congress could still issue its own money!
Until recently, here's how it worked. Buy a home. Hire someone to appraise my home for more than I bought it for. Go to a bank and with draw that amount of money.
Great. So if all they have is $10,000 where does the $100,000 come from?
That is a lot of lamp posts!
Officials of the Bank of England asked [Benjamin] Franklin how he would account for the newfound prosperity of the colonies. Without hesitation he replied:“That is simple. In the colonies, we issue our own money. It is called Colonial Scrip. We issue it in proper proportion to the demands of trade and industry to make the products pass easily from the producers to the consumers... In this manner, creating for ourselves our own paper money, we control its purchasing power, and we have no interest to pay to no one.”
How is money created? It’s called a printing press. Perhaps it’s been heard of.
The primary difference between the United States Note and the Federal Reserve Note is that a United States Note is created by the government directly as a bill of credit, and thus there is no interest for the Government to pay for the creation of that dollar.A Federal Reserve Note, on the other hand, is bank currency, and the U.S. has to pay interest on the treasury bonds that it gives the Federal Reserve System in exchange for the right to produce a like quantity of Federal Reserve Notes. This, in turn, increases the tax burden on the people. Abraham Lincoln advocated the use of United States Notes because they avoid the usury and debt multiplication aspects of debt-based currencies, and thus save the Government immense sums of interest. Thomas Jefferson also believed that the issuing power of money should rest with the US Treasury, and not the private banks.
http://en.wikipedia.org/wiki/United_States_Note
tooo damn funny...
They create it.
If they need 10% in reserves they can either take that original $10,000 keep $1,000 in the vault and loan out $9,000.
Or they can keep all $10,000 in the vault and loan out $100,000.
Would Mr. Bankerman rather collect interest on $9,000, or $100,000?
Remember that the borrower almost never gets his loan in cash, it’s almost always in the form of a check, or as a deposit in his account.
Money is neither created nor destroyed... it just gets swiped in massive quantities just before a deposit of the left-overs hits my bank account.
That's funny.
If they need 10% in reserves they can either take that original $10,000 keep $1,000 in the vault and loan out $9,000.
Excellent! Yes! Correct!
Or they can keep all $10,000 in the vault and loan out $100,000.
Bzzzt! Wrong! Thanks for playing.
Try to follow the math. If the Fed requires you to keep 10% of all your deposits as a reserve and you get a deposit of $10,000 then your reserve requirement is $10,000 x 0.1 or $1,000. You seemed to understand that.
Now, if you're keeping $10,000 in the vault, how in the name of public school math do you get $100,000 to loan out? Take your time. Walk through the steps one by one.
btt
Money today can be extinguished, as when a loan is paid off, or in aggregate by federal open market operations. Do you consider the prime concern today to be one of deflation or inflation as evidenced by FED activities in the last six months? What, if anything, do you reckon would be the right thing to do with respect to Bear Stearns? Hint: “let them twist slowly, slowly, in the wind” isn’t one of the choices.
Beware Toddster works for the Federal Reserve and is paid to ask people stupid questions and defend the stupid system. Ignore him.
Beware Toddster works for the Federal Reserve and is paid to ask people stupid questions and defend the stupid system. Ignore him.
Sorry. that is precisely what they do. The rules allow them to loan out 10 times what they have in the vault. That’s exactly what they do.
Seriously.
Ask your bank manager Monday.
Hey Todd? We can handle the truth.
Really.
http://www.dollardaze.org/blog/?post_id=00255
Do you mean 1963 series? There are pics of those notes at the link. Apparently, Kennedy signed an executive order allowing the issuance of those notes backed by silver.
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