Tuesday, April 20, 2010

A Mistake Does Not Mean "De-Bunked"

We have a little confusion here, for which I realize is due to my own mistake. The Pie Chart I referenced is for % of holder's of Treasury Securities - which I mistakenly attributed to as the total Government debt in my post, Our fiat reality - 21st Century Serfdom.

The Treasury Securities, as you will note, is what the Fed sells or buys to carry out there market operations. Of the total treasury securities (which represents a debt the US taxpayer is liable for), the Fed and other Intragovernmental agencies owns 49.37% of all treasury securities debt issued up to the point in time of the chart in 2008.

And that, as PMAFT calculated, is only a fraction of total government debt.

But that doesn't "debunk" any "conspiracy" aspects pointed out regarding the Federal Reserve system.

The Federal Reserve's practice of fiat currency being "printed" into existence by a mouse click in which they sell Bonds to the Government is a major contributor to the public debt.

This also doesn't debunk the manner in which fractional reserve lending practiced by all member banks of the Fed system is a primary cause of inflation, nor does this debunk the issue of the Fed's arbitrary setting of interest rates that are the root cause of "bubble" creations.

As for the rest of PMAFT's "debunking":

There was a committee in 1976 formed to investigate corporate banking influence. They issued a report entitled: Federal Reserve directors, a study of corporate and banking influence

Here's a chart from that report.

The money quote:

Chart 1 reveals the linear connection between the Rothschilds and the Bank of England, and the London banking houses which ultimately control the Federal Reserve Banks through their stockholdings of bank stock and their subsidiary firms in New York. The two principal Rothschild representatives in New York, J. P. Morgan Co., and Kuhn,Loeb & Co. were the firms which set up the Jekyll Island Conference at which the Federal Reserve Act was drafted, who directed the subsequent successful campaign to have the plan enacted into law by Congress, and who purchased the controlling amounts of stock in the Federal Reserve Bank of New York in 1914. These firms had their principal officers appointed to the Federal Reserve Board of Governors and the Federal Advisory Council in 1914. In 1914 a few families (blood or business related) owning controlling stock in existing banks (such as in New York City) caused those banks to purchase controlling shares in the Federal Reserve regional banks. Examination of the charts and text in the House Banking Committee Staff Report of August, 1976 and the current stockholders list of the 12 regional Federal Reserve Banks show this same family control.

There's also another official source that reveals that the Fed is in fact a privately owned corporation and not a government entity - from the 9th circuit court's case: Lewis v. United States, 680 F.2d 1239 (1982)

Quote: Examining the organization and function of the Federal Reserve Banks, and applying the relevant factors, we conclude that the Reserve Banks are not federal instrumentalities for purpose of the FTCA, but are independent, privately owned and locally controlled corporations.

As for the entire mathematical argument that the Fed doesn't get that much money from their operations because they "return" the profit to the treasury...

Here's the blog posting of a guy who looked up the interest paid back by the Fed to the Government in 2008 -

Only 20% of the FEDs income returns to the US Treasury.

There is 50+ Trillion dollars of monetized debt in our US economic system. At a 5% interest rate (which I will use in my argument as the average rate of interest that FED banks charge to their customers) that would account for around 2.5 trillion of interest income on issued debt. That is a conservative number because you still need to add T-Bill interest profits, subtract the insignificant 6% divendend income that federal reserve shareholders receive, and then add extra profits that FED banks earn from transaction fees.

Off the top of my head, according to the 2008 US Treasury balance sheet, located on page 5 at http://www.fms.treas.gov/mts/mts1108.pdf , the Government only received about 500 billion in excess interest profits from the treasury in 2008. So, where did the other 2 Trillion of interest go? Should we believe that the banking system requires 2 trillion in operating expenses each year?

With the Federal Reserve banking system having more than 2.5 Trillion a year in profit, how is it even possible that there could be a single bank failure? It doesn't seem possible when we know that they are swimming in 2.5 trillion of profits on interest. It would seem that a not-for-profit corporation such as the Federal Reserve system could easily pay off their liabilities before the excess profits go back to the government. Not so in this case because evidently the tradition is to take additional bailout funds from the government after they pocket the remaining 80% of their interest income. You can't tell me that 2 trillion dollars goes to operating expenses!

This is precisely why the Fed "returns" profit to the treasury - it's a clever trick to fool the people as to what they are really doing.

Finally, PMAFT, you've rested your entire argument on mathematical calculations, while ignoring the source material I mentioned...namely, The Creature From Jekyll Island.

This book names names and goes through a historical recounting of the meeting of the financial elite who got Woodrow Wilson to sign the Federal Reserve Act into law in 1913.

In essence, you've debunked my error...not the 'conspiracy theory' of the Federal Reserve and it's role in financing the NWO.


Pro-Male/Anti-Feminist Tech said...

we conclude that the Reserve Banks are not federal instrumentalities for purpose of the FTCA, but are independent, privately owned and locally controlled corporations.

It's only talking about the Federal Tort Claims Act, hence "for the purpose of the FTCA". That same court case also said, "The Reserve Banks have properly been held to be federal instrumentalities for some purposes."

Here's the blog posting of a guy who looked up the interest paid back by the Fed to the Government in 2008 -

He obviously didn't look up what the Fed actually owned. It doesn't own $50 trillion dollars of anything. There was a comment with this link showing that the Fed doesn't own anywhere near $50 trillion dollars.

Federal Reserve directors, a study of corporate and banking influence

This is available online. I took a look at it. "Chart 1" and "Chart 2" are nowhere to be found in it. The terms "Rothschild" and "Bank of England" are nowhere to be found in it. "Chart 2" says it's taken from a document with the same name in 1983. It was written in 1976. The other charts aren't even called 3, 4 and 5. Page 1 of it has a sentence that starts out, "While the Board of Governors in Washington occupies the dominant position in the Federal Reserve System..." showing that the Board of Governors, the government agency, is dominant in the Fed system. (Feel free to check the context of that statement.)

the Fed system is a primary cause of inflation

Of course it is. That's not a plot or conspiracy but because a mainstream economists think the most optimal strategy in monetary policy is to have low inflation each year. Mainstream economists could very well be wrong on this but if you want real change in this it isn't in the realm of conspiracy theory but in the real science of economics. Even if the Fed disappeared tomorrow, whatever replaced it will have the same low inflation per year policy because it's what mainstream economics says is the best strategy.

njartist said...

Come, Come, HL don't you know that ignorance on the part of your audience means you lost your argument. Hannity, O'Rielly, and Limbaugh are frequent users of "I don't know that so I win the argument," routine.

The refusal to understand that there are conspiracies operating on many levels is the primary cause as to why our freedoms have been lost and vile men now enslave us.