Skip to comments.We have been Cyprus since 1913, 6% every year to the Fed out of the economy
Posted on 03/20/2013 12:24:08 PM PDT by reluctantwarrior
Why the sudden anxiety over a one time 10 percent haircut out of Cypriot bank accounts?
Because the average person is hardly aware that the Federal Reserve even exists let alone anything about how it operates. Just ask someone while waiting in the check-out line in a store and see what answer you get.
The charter and organization of each Federal Reserve Bank is established by law and cannot be altered by the member banks. Member banks, do however, elect six of the nine members of the Federal Reserve Banks’ boards of directors. From the profits of the Regional Bank of which it is a member, a member bank receives a dividend equal to 6% of their purchased stock. The remainder of the regional Federal Reserve Banks’ profits is given over to the United States Treasury Department. In 2009, the Federal Reserve Banks distributed $1.4 billion in dividends to member banks and returned $47 billion to the U.S. Treasury
Federal reserve citation on wikipedia
that is without a doubt the stupidest analogy I have ever seen.
When my father could buy a new Buick for $2000 in the ‘50s and our new brick custom home cost $25,000, I have seen in my lifetime the drastic devaluation of the dollar. One can only guess how many tens of thousands of shrinking dollars my grandchildren will have to spend to buy their cars and homes.
thanks for the insult since Im so stupid please explain why its the stupidest analogy ever
Fed banks get paid by banks six percent on the FRNs they laon to member banks the FRNs are created for nothing so the fed pulls six percent out of the economy for the use of FRNs
the 1973 Nixon decision to exit the partial gold backed currency and allow infinite money expansion led to a flat or small loss of wage/purchasing power of most wage earners since 1974
It will be Zim dollar inflation when the Chinese move most trade to the Yuan.
Because in Cyprus there is a 10% loss overnight to depositors as compared to in America where depositors have not lost money in a bank insolvency.
And because you imply that 6% of GDP goes to the banks, rather than a 6% return on a tiny, token volume of capital stock that would barely show up on a community bank’s balance sheet if indeed it exists at all.
The six percent is paid on every dollar loaned from a federal reserve bank to a member bank since each FRN is considered a share otherwise how does 46 billion get paid back into the Treasury in 2010 and 1.6 billion posted as retained earnings but the balance sheet shows an additional capital stock growth from 900 billion to 972 billion. Where did the 72 billion come from in 2010. Pull the balance sheet from the Feds website and run the numbers it is time better spent then insulting me, but hey I guess since you are an expert facts are only an impediment to your considered opinion
the Fed owns more than two trillion in bonds. That’s where the bulk of that income derives from. Oh and by the way that money you cite is federal government REVENUE and thus helps offset the deficit. It’s a yield paid on bonds by the taxpayers, TO the taxpayers. A zero sum for the sake of deficit calculations.
When the Fed participates in bank lending it is through the Federal Funds market, which currently is an interest rate between 0 and 0.25%.
To imply that they pull a 6% yield on the entire money supply is just hogwash. You’re like that guy who says “I have no idea, therefore ALIENS” only it’s “I have no idea, therefore banking conspiracy”
80 percent of treasuries are now purchased by the fed 85 billion a month so how does the fed pay interest on a bond it buys with FRNs it creates digitally
when you monetize your debt your are insolvent
the expansion of the balance sheet isn’t a good thing, fractional reserve banking is our undoing but hell you’re an expert and I’m just a simple guy who must balance his budget every month but hey deficits don’t matter and debt is simply us paying ourselves. You sir are part of the problem, keep whistling past the graveyard but I am opting out of the Federal Reserve Ponzi scheme
Youre like that guy who says I have no idea, therefore ALIENS only its I have no idea, therefore banking conspiracy
Ah! so you do not believe the federal reserve is a banking conspiracy?..
Since it obviously is.. you’re outted..
Obviously since there is nothing federal about the federal reserve..
They are private for profit Banks with stock shareholders and everything.. A BUSINESS..
A global international business... with one purpose, making a profit..
They could care less about the American Constitution, and don’t..
The word game “federal reserve” is a scam.. a BOONdoggle.. for theft on a massive scale..
Both partys support it.. an “Animal FArm” milking the american people like farm animals.. and butching their children..
The Federal Reserve is a parasite.. a virtual Vampire..
at the root of all the Nixons, Clintoons, Obama’s, and Kennedy’s.. and Yes.. Bush’s.. Farming the American people like sheep.. It all starts at the federal reserve but threads go through every fabric of american politics..
The federal reserve is not federal it’s GLOBAL...
Silly me.. I’m talking to SHEEP!... LoL...
Nothing except of course that...
Not sure I trust the goverment's measure so to double check that...historical food prices
Cost of bread in 1914. $0.063. Cost today $2.00 Bread Inflation 0.035%
Cost of Sirloin Steak in 1914. $0.259/lb Cost of sirloin steak today. $5.99/lb (Kroger current ad) Steak Inflation 0.032%%
Thats the way it is supposed to work.. you really don't think it actually works that way do you?...
That the fed.res stockholders have no say in these matters?...
That the fed is not MORE Corrupt than General Motors? or General Electric?.. or Chase?..
Much more corrupt.... if thats even possible..
The federal reserve is a Vampire.. that grows intestinal worms in the body poltik also parasites.. and elects or has them elected to figurehead positions.. I see you seem to be a sheep..
Cost of bread in 1914. $0.063. Cost today $2.00 Bread Inflation 0.035%
Try that with the cost of a car or house or silver or gold..
or an education.. amazing inflation..
That's why it returns the interest to the Treasury.
the expansion of the balance sheet isnt a good thing, fractional reserve banking is our undoing
I agree with you 100%. We do not need a central bank; it was created solely to enable the government to fund itself without resorting to tax increases.
I do disagree with your interpretation of the Wikipedia article. The Fed does not take a profit of 6% on the entire money supply. At the current supply of money [M1], 6% would be $164.5 billion.
A house or car are hard to compare because the standards in housing and cars are so dramatically different. The average house in 1913 cost $6000. But at 3.5% inflation that’s worth $187,000 now. Which would you rather have, a $187,000 house built today, or the kind and size of the average house selling for $6,000 in 1913, with no running water, no electric plugs, no a/c, no lights, no appliances, and not built to any safety codes? Seriously?
Gold’s in a bubble right now. But even so, since 1913, the inflation rate in gold has been a whopping 4.5%. 1913 to 2003 was 3.4%.
I will go re reread the monster from Jekyll Island to check on this, but I do believe it does pull 6 percent on the M1