H.R. 2755 to Abolish the Federal Reserve

http://www.picassodreams.com/picasso_dreams/2007/06/hr_2755_to_abol.html ^ | June 17, 2007

[keyd]

June 17, 2007

H.R. 2755 to Abolish the Federal Reserve

If our nation can issue a dollar bond, it can issue a dollar bill. The element that makes the bond good, makes the bill good, also. The difference between the bond and the bill is the bond lets money brokers collect twice the amount of the bond and an additional 20%, where as the currency pays nobody but those who contribute directly in some useful way. Is it absurd to say that our country can issue $30 million in bonds and not $30 million in currency? Both are promises to pay, but one promise fattens the usurers and the other helps the people.” - Thomas Edison

“Banking was conceived in iniquity and born in sin. Bankers own the earth; take it away from them but leave them with the power to create credit, and, with a flick of the pen, they will create enough money to buy it all back again. Take this power away from them and all great fortunes like mine will disappear, and they ought to disappear, for then this world would be a happier and better world to live in. But if you want to be slaves of bankers and pay the cost of your own slavery, then let the bankers control money and control credit.” - Lord Stamp, Director of the Bank of England, 1940

“I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is now controlled by its system of credit.

We are no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of a small group of dominant men.” - Woodrow Wilson, 1919 (Referring to the Federal Reserve and the transition to a debt-based economy)

“The stock of money, prices and output was decidedly more unstable after the establishment of the Reserve System than before. The most dramatic period of instability in output was, of course, the period between the two wars, which includes the severe (monetary) contractions of 1920-21, 1929-33 and 1937-38. No other period in American history contains as many as three such severe contractions. This evidence persuades me that at least a third of the price rise during and just after World War 1 is attributable to the establishment of the Federal Reserve System… and that the severity of each of the major contractions - 1920-21, 1929-33, and 1937-38 - is directly attributable to acts of commission and omission by the Reserve Authorities… Any system which gives so much power and so much discretion to a few men, (so) that mistakes - excusable or not - can have such far reaching effects, is a bad system. It is a bad system to believers in freedom just because it gives a few men such power without any effective check by the body politic - this is the key political argument against an independent central bank… To paraphrase Clemenceau, money is much too serious a matter to be left to the central bankers.” - Milton Friedman, Nobel Prize winning economist.

Presidential candidate and Congressman Ron Paul (R-TX) introduced H.R. 2755 “To abolish the Board of Governors of the Federal Reserve System and the Federal reserve banks, to repeal the Federal Reserve Act, and for other purposes.”  This legislation would help to restore the U.S. Constitution, which mandates that only Congress can coin money (Article I, Section 8, Clause 5), and that US debts be settled in silver and gold Article I, Section 10, Clause 1).

This is the second time he has introduced legislation.

Given that one out of six Americans works for government (local, state and federal) or an organization/corporation that receives the majority of its revenues from government, it is easy to see why this news isn’t considered newsworthy for the mainstream press. Government workers are dependent upon the printing presses. Politicians certainly don’t want the dissolution of the Fed. They borrow money from the bankers and make your great grandchildren pay interest on the debt so they can “bring home the pork”. You did not participate in these loans, you receive no financial benefit from these loans, nor did you sign any contracts making you responsible for the debt, but you and future generations will be forced to pay until Congress dissolves the Fed or there is revolution. There is no other choice.

[Toddsterpatriot]

So when the $1000 is withdrawn, where does the bank get the cash? Do they print it?

Can't even keep track of your own post?

The fact that you can come back to the bank the very next day and withdraw your entire $1000.00

We can talk about what happens if I withdraw my money, but that wasn't in your example.

When $1000 is deposited and the bank goes through this "process" 28 times, how much "money" exists? Is it more than $1000? If so, where did it come from?

I could explain it to you, but based on your apparent knowledge, you wouldn't understand it.

[Toddsterpatriot]

Sorry Fan, I thought that was him, not you. LOL!

[iconoclast63]

Absolutely the bank creates MORE than your original deposit in new loans. As long as their borrowers deposit the loan checks into checking accounts held at the bank, the bank can continue to create new loans based on those reserves. In one analysis I read, in todays banking system, a bank can needs less than $20 in deposits to create $10,000 in new loans. Not sure about that though.

As far as cash, you must understand that actual paper currency has little to do with the total money supply because the VAST majority of dollars are nothing more than data bits in bank computers. Banks maintain what they think will be sufficient cash to meet the daily requirement of check cashers.

[iconoclast63]

Instead of just saying “wrong” why aren’t you offering an alternative? On what points, precisely, am I wrong and what is correct?

[Toddsterpatriot]

Instead of just saying “wrong” why aren’t you offering an alternative?

Alternative? You made claims. I said they were wrong. If you have a source, post it.

[the OlLine Rebel]

“which mandates ....that US debts be settled in silver and gold Article I, Section 10, Clause 1).”

Sorry, but this part doesn’t quite make sense.

Section 10 is about what STATES may or may not do. It specifically says in the same clause that STATES may neither coin money (which you are advocating only Congress has power to do, per other referred clause) nor “make any thing but gold or silver coin a tender in payment of debts”.

It doesn’t say anything about the US as a WHOLE specifically using gold or silver.

[iconoclast63]

That is correct, oh arrogant one. I have made assertions, based on YEARS of research and discussion with economics professors, Fed apologists and politicians.

You say my assertions are wrong? Fine, how are they wrong?

[Loud Mime]

I’ve read that all governmental agencies are corporations. Anybody know about this?

[Toddsterpatriot]

That is correct, oh arrogant one.

Talking to yourself? LOL!

I have made assertions, based on YEARS of research and discussion with economics professors, Fed apologists and politicians.

Great, now show actual numbers that prove your assertions were correct.

Fine, how are they wrong?

Wrong, the opposite of right.

[iconoclast63]

If you want to know where the Fed gets the money it uses to buy government debt, you need merely read up on the Fed's own literature to find out that it CREATES money for that purpose. A much better place to educate yourself on the true nature of the financial system is www.monetary.org. Or, in the congressional record you will find plenty of quotes, for example: This money creation which is put into the system when the banks extend loans, eventually becomes a source of funding when our government’s bonds are sold to the public. Here is how Wright Patman, former House Banking and Currency Committee Chairman for 16 years criticized that process: “I have never yet had anyone who could, through the use of logic and reason, justify the Federal Government borrowing the use of its own money....I believe the time will come when people will demand that this be changed. I believe the time will come in this country when they will actually blame you and me and everyone else connected with the Congress for sitting idly by and permitting such an idiotic system to continue.”

[Toddsterpatriot]

You haven’t answered any of my questions or proven any of your assertions. Try again?

[iconoclast63]

You have not asked me a single question, you have merely sat back and said I was wrong. I suggest that anyone keeping track of this thread, not you Todd because you are an idiot, go the website I posted: www.monetary.org and read up on the subject. There is much to be learned and much to be gained by all of us by putting forth a serious effort to reform our corrupt monetary system. Here are the 3 principle recommendations of AMI, for your approval: Monetary reform is achieved in 3 parts which must be enacted together for it to work. Any one or any two of them alone won’t do it, but could actually further harm the monetary situation. First, incorporate the Federal Reserve System into the U.S. Treasury where all new money is created by government as money, not interest-bearing debt, and spent into circulation to promote the general welfare; monitored to be neither inflationary nor deflationary. Second, halt the banks privilege to create money by ending the fractional reserve system in a gentle and elegant way. All the past monetized private credit is converted into U.S. government money. Banks then act as intermediaries accepting savings deposits and loaning them out to borrowers; what people think they do now. Third, spend new money into circulation on infrastructure, including education and healthcare needed for a growing society, starting with the $1.6 trillion that the American Society of Civil Engineers estimate is needed for infrastructure repair; creating good jobs across our nation, re-invigorating local economies and re-funding government at all levels

[Toddsterpatriot]

You have not asked me a single question, you have merely sat back and said I was wrong.

I asked you to post the sources for the numbers that prove your assertions about Fed ownership of Treasury debt as compared to foreign ownership of debt.

You never gave your source for "Finally, estimates say that the American people are in debt to the tune of over $40 trillion at present"

You never explained "and feeding the banking system with unlimited profits". Who earns those unlimited profits? Or how much those profits are?

No source for "The Treasury securities you speak of are sold FIRST to the Fed"

I suggest that anyone keeping track of this thread, not you Todd because you are an idiot

If you say so, noob.

First, incorporate the Federal Reserve System into the U.S. Treasury where all new money is created by government as money, not interest-bearing debt, and spent into circulation to promote the general welfare

Good way to pump up inflation, idiot.

Second, halt the banks privilege to create money

You still haven't shown how they create money while lending less than their deposits.

by ending the fractional reserve system in a gentle and elegant way.

By causing a new Great Depression? LOL!

All the past monetized private credit is converted into U.S. government money.

Huh?

Banks then act as intermediaries accepting savings deposits and loaning them out to borrowers

Exactly how is that different from what they do now?

[Freedom4US]

What probably made FDRs stunt so popular, is he gave his buddies forewarning. So, they cleaned out their accounts and sent their gold overseas for safekeeping. Then, FDR confiscates coinage gold from the public and then re-values the official price from $20 to $35, thus netting a hefty 60 per cent profit overnight. Even today, virtually all “new stock” old US gold coins for sale to collectors come from european vaults, apparently.

[Toddsterpatriot]

and then re-values the official price from $20 to $35, thus netting a hefty 60 per cent profit overnight

$20 to $35 is a 75% profit.

[iconoclast63]

You have not asked me a single question, you have merely sat back and said I was wrong: I suggest you do your own research because you obviously have no data to refute my assertions or you would have provided it. I will include a link to help you out with the total debt burden since I have that link right on my desk top. Going forward, please present any of YOUR assertions which would contradict mine and I will be happy to address them and who knows, maybe I will learn something new. I asked you to post the sources for the numbers that prove your assertions about Fed ownership of Treasury debt as compared to foreign ownership of debt. You never gave your source for "Finally, estimates say that the American people are in debt to the tune of over $40 trillion at present" According to mwhodges.home.att.net total public and private sector debt excluding contingent liabilites is $48.4 Trillion. You never explained "and feeding the banking system with unlimited profits". Who earns those unlimited profits? Or how much those profits are? No source for "The Treasury securities you speak of are sold FIRST to the Fed" I suggest that anyone keeping track of this thread, not you Todd because you are an idiot If you say so, noob. First, incorporate the Federal Reserve System into the U.S. Treasury where all new money is created by government as money, not interest-bearing debt, and spent into circulation to promote the general welfare. Good way to pump up inflation, idiot. How is government spending money into the system MORE inflationary than allowing a central bank to loan it? Money is being created by the same process except under AMI's proposal there is no attendant debt, saving taxpayers BILLIONS in interest. Second, halt the banks privilege to create money You still haven't shown how they create money while lending less than their deposits. Ok, one more time. Banks create money when they use a deposit as the basis for a new loan then immediately return the money to the depositor. When you deposit $1000 in the bank and they use that as the basis for an $800 loan, THEN YOU COME BACK THE VERY NEXT DAY AND REMOVE THE $1000, that does not mean the $800 check they wrote the borrower disappears by some kind of magic. The money they loaned is REAL money that the borrower is using to pay for things, yet the original deposit that served to create that loan is no longer in the bank. Once again, WHERE DID THE $800 COME FROM??? by ending the fractional reserve system in a gentle and elegant way. By causing a new Great Depression? LOL! All the past monetized private credit is converted into U.S. government money. Huh? Banks then act as intermediaries accepting savings deposits and loaning them out to borrowers Exactly how is that different from what they do now? AMI is proposing to replace ALL existing Federal Reserve Notes with actual hard cash in the form of United States Notes. Every FRN in the banking system would be replaced by actual cash, so the banks would not suffer a loss, and going forward banks would ONLY be allowed to loan ACTUAL cash held in their vaults that BELONGED to the bank. They would no longer be allowed to loan depositors money unless the depositor agreed to allow the bank to hold their cash for the full term of the loan. Fractional reserve banking would be prohibited.

[Freedom4US]

You’re right, they didn’t actually hit 35 bucks till a bit later on, tinkering with the economy as it were. “Prime the pump”, Roosevelt said they would decide on a figure pulled out of the air over breakfast.

[Toddsterpatriot]

I suggest you do your own research because you obviously have no data to refute my assertions or you would have provided it.

I know you're an ignorant noob, but the way it works is if you make an assertion, you should provide a source that backs you up.

According to mwhodges.home.att.net total public and private sector debt excluding contingent liabilites is $48.4 Trillion.

Adding government debt to private debt and then claiming the American people are in debt is just a little bit (okay, a lot dishonest). And discussing debt without including assets is pointless. My debt has doubled in the last 10 years. Wow! My net worth has increased by over 900%. My debt doesn't sound as scary now, does it?

How is government spending money into the system MORE inflationary than allowing a central bank to loan it?

You'd have to compare how much the government currently borrows to how much the Fed buys in Treasury securities. But if you did that, you wouldn't have made the stupid mistakes you did upthread.

Banks create money when they use a deposit as the basis for a new loan then immediately return the money to the depositor.

But they can't do that. If the depositor pulls $1000 out, in your example, they'd have to shrink loans by $800. I know you don't understand that either.

AMI is proposing to replace ALL existing Federal Reserve Notes with actual hard cash in the form of United States Notes.

FRNs are bad but United States Notes are good? That's funny!

and going forward banks would ONLY be allowed to loan ACTUAL cash held in their vaults that BELONGED to the bank.

So, they'd be able to loan 100% of deposits instead of the current 90%. How is that better?

They would no longer be allowed to loan depositors money unless the depositor agreed to allow the bank to hold their cash for the full term of the loan.

Reserve requirements are lower (maybe 0%) on long term deposits already.

Fractional reserve banking would be prohibited.

Well, 100% isn't a fraction. So what?

Please learn how to format. It's hard enough following your stupid posts, don't make it harder than it has to be.

HTML Bootcamp

[Fan of Fiat]

Adding government debt to private debt and then claiming the American people are in debt is just a little bit (okay, a lot dishonest). And discussing debt without including assets is pointless.

I borrowed $100 from my wife's purse to buy a savings bond. Therefore, US / private debt just went up $200! We're DOOMED!

How's that for goldbug math?

[Toddsterpatriot]

How's that for goldbug math?

That is a really excellent example. He'll never understand.