How Banks "Create" Money

This post is a rehash of an older post, which was a rehash of an even older post I made at The Spearhead. But in my opinion, the main point here needs to be restated, reiterated and repeated until it becomes a commonly understood meme.

I've been a long time reader of Vox Day's blog...at least since 2002 (maybe earlier, I can't remember). His was the first place I truly encountered Austrian economic theory and anti-Statist, libertarian philosophy. Most of the long time commentariat (known collectively as the dread ilk) are well informed about economics and understand the system of the US Federal Reserve.

But even some of the long-time regulars of the dread ilk still miss one of the most relevant points regarding our present day money "creation" system, which is a very big part of driving inflation. Dread ilk old-timer, Difster, wrote the following:

"The banks themselves don't create money but the Federal Reserve does.

I'd suggest you read The Creature from Jekyll Island about the creation of the Federal Reserve. Also of course, read End The Fed by Ron Paul.

This will give you a great education and probably piss you off. If it doesn't, there's something seriously wrong with you."

Now, it's true that banks don't print paper currency money, but they most certainly do "create" money...aka - digital numbers entered into their account record-keeping computing system. In other words, you go to the bank, and you sign the paperwork to take out a loan, the bank doesn't physically count out stacks of bills in the amount you're borrowing and then hand it over to you in one lump sum.

No, they simply type the number in to their system, and voila, you now have whatever amount of money you agreed to borrow in a new account (or "deposited" into an already existing account). The only constraint they have on their money "creating" powers, is the fractional reserve requirement of their regional Federal Reserve Bank - which is generally 10%. This reserve amount on deposit, than allows the bank to "leverage" it to create money in the form of loans made out to other borrowers from the bank.

In other words, your local bank need only have $100 in their regional Fed Reserve account to turn around and "create" a $1,000 loan account to you. At the signing off of a new loan document, the bank just "created" $900 of fiat currency at the push of a few keyboard buttons. This new "$1,000 account balance" is than considered a "new deposit" for which only the required reserve amount is deposited at the Federal Reserve Regional Bank to than turn around and make a new loan to someone else.


Now this is a very simplified example I've used to explain the money creation process. It used be stated plainly on the Dallas Federal Reserve Bank's own website. The following quote was taken straight from an old html page that no longer exists on the Dallas Reserve's website:

How Banks Create Money

Banks actually create money when they lend it. Here’s how it works: Most of a bank’s loans are made to its own customers and are deposited in their checking accounts. Because the loan becomes a new deposit, just like a paycheck does, the bank once again holds a small percentage of that new amount in reserve and again lends the remainder to someone else, repeating the money-creation process many times.

However, this exact same quote is still available on a new .pdf file you can download from the Dallas Federal Reserve Website: dallasfed.org/assets/documents/educate/everyday/money.pdf

Page 11 of that pdf file contains the exact same quote that used to exist as an html webpage as of less than a year ago, the html page still existed and easily hyperlinked and googled. Now it's only found as a pdf download.

A Federal Reserve Branch essentially admits a core feature of our modern monetary system: Federal Reserve member banks (aka Cartel members) are allowed to "create" money by making loans.

In other words, anytime you see the tell-a-vision footage of the Fed's printing presses making all those brand new sheets of dollar bills to be put into circulation, the actual, physically existing paper money  is only a fraction of the total money in our economy. MOST of the "money" in today's economy exists solely as digital numbers entered into bank's accounting/record-keeping computer systems, with only the required 10% actual cash being deposited at the regional Fed bank.

In other words...most of the money in today's "economy" is not actual paper currency...but DEBT agreed to by borrowers from the Federal Reserve's fiat currency/fractional reserve Cartel members. The more debt that's created, the more the money supply exponentially expands, driving inflation,

Paleo Toddler

It's been a year and a day since I posted the most read, linked-to and commented-on thread on this blog, Paleo Baby.

Getting linked by Primal lifestyle guru Mark Sisson was the equivalent to getting an Instalanche here on the fringes of the politically incorrect blogosphere. (Mahalo, Mark!)

Initially, I was amazed by the sheer number of folks that left comments...but I was even more amazed by the number of folks who were hostile, angry or felt personally insulted by that post.

A lot of folks seemed to think that somehow I was coming across as a condescending, know-it-all blowhard who implied that because they fed their kids formula or that their kids were colicky, I was judging them as parental failures.

At first, it made me angry and I responded in kind. The passage of time, interactions with many young and new to-parenthood peers and much personal reflection, has given me new insights into the psychology of Parenting. I get it. I really do!

Like everything else in our Brave New World Order of Mass Media Indoctrination, everybody has ideas about what is best for raising children. My new parental discussion code is this:

I'm not trying to tell you what to do, and I'll politely listen to your beliefs. I'll explain why I may disagree, but only if  you ask...but mostly I'll just nod and give you an affirmative smile, rather than tell you why I don't think feeding kids grains, cereal, or not much meat is such a great idea.

I've learned since having my own kid, that everyone who's had kids is an expert when it comes to parenting.

"THEY say 'X' is best for 'Y'!"

I'm no expert. I only pretend to be one as an anonymous blogger on teh interwebz!

This is simply sharing my experiences from loosely adopting the Primal/Paleo lifestyle. "Going primal" nearly 5 years ago now, has been a dramatically life altering experience in terms of my own health and well being. So when my first child came along, it was only natural that I applied the same principles in feeding and caring for my offspring.

So here we are one year later, and "Paleo Baby" is now "Paleo Toddler."

My how time seems to fly quicker once you have someone other than yourself to care for and observe as they grow and mature..

Over this past year, I've periodically received emails and comments requesting I give updates, recipes, tips and pointers from people desirous of raising "Paleo babies" of their own, as well as the curious, wanting to know how my kid's health and growth are going. I've basically had to resist the urge to turn my blog into a "new-parent" navel gazing blog (not that there is anything wrong with those sorts of blogs).

Nevertheless, consider this my obligatory "update" post.

In revisiting many of the points from my original post, let's just say most of those points have not changed much in the past year. To avoid overusing the term "Paleo Baby" or "Paleo Toddler" and turning this into a caricature of gimmickry, I'm going to refer to the kid from here on out as "Keiki," which is Hawaiian for child.

- Approaching two years of age, my keiki has never had an ear infection, a chest cold, or a fever...other than the mild, low grade fever that typically accompanies teething. Keiki has had a runny nose a couple of times, but that usually cleared up within a day or two.

- Speaking of teething, Keiki has an entire mouth full of choppers, all nicely formed, straight and evenly spaced. This seems to fit with the observations of Dr. Weston Price regarding dental health and development that correlate with the nutrient dense diets of traditional peoples. I myself have a narrower jaw and crooked teeth. Then again, I was raised on Soy formula from birth. I had poor dentistry, bad allergies, asthma. So far, keiki has seemed to avoid all that.

- Keiki's immune system is strong. Mommy has gotten sick several times in the past year, as her job puts her into contact with a lot of travelers from around the world, on a daily basis (she works at the airport). Keiki has never contracted anything she's brought home...including the flu and a pretty bad chest cold for which she ended up having to get an anti-biotic prescription for.

- In keeping with the Primal diet ethos, keiki has eaten almost zero grains/cereals or legumes. About 6 months ago, I dropped keiki off with a short term babysitter. I assumed that dropping keiki off with a cooler full of foods my wife had prepared, that the sitter would feed keiki that food, so I need not worry. She ended up feeding keiki a bunch of "heart-healthy, whole grain!" dry cereal. Keiki had diarrhea for the next 12 hours. Fascinating to see a child who's gut had never encountered grains for the first year and half of life, and had almost zero diarrhea episodes prior, would react to cereal like that. That was also the last time keiki had diarrhea (or grain based cereal).

- Recently, while at a party with a large group of kids and adults, in a moment where I wasn't paying attention, another parent who I was not well acquainted with (all who know us well, know how strict we are with keiki's diet, lol), gave keiki a cracker. Keiki threw up a half an hour later. Coincidence? I don't know. All I know is that Keiki has only thrown up 3 times ever. Vomiting is not normal behavior for my keiki, unlike some other cereal munching, soy formula kids I know.

- So what does keiki eat now? Basically everything my wife and I eat...i.e. freshly prepared, "slow food" meals. No fast food, convenience foods, processed, packaged foods. We try to vary up our diet a lot, but the one constant is the usual daily breakfast with eggs from our pasture raised, free range chickens.

- Keiki eats a wide variety of animal protein: free range/additive free bacon and sausages. Most of it though is Paleo...Hawaiian style. Lot's of smoked, dried, raw and fresh fish, tako (octupus), shrimp, crab, hawaiian slipper lobster, 'opihi (limpets) and lots of grass fed beef (including some occasional liver), and wild boar if I manage to have a successful hunt. Keiki also gets a lot of bone-broth based soups and stew that we've begun to eat on a regular basis.

- Keiki also loves dairy; organic, unsweetened yogurt, and a wide variety of high quality cheeses...and the very occasional mouthful of ice cream (are favored 80/20 very occasional "cheat".)

- Contrary to some of the Paleo/Primal purists and adamant low-carbers, we do eat moderate portions of carbohydrates at almost every meal - white rice, sweet potatoes, mashed potatoes, fried potatoes, poi, and tortilla made from corn flour (treated with lime) and once in a while, some gluten free pasta.

- Keiki loves vegetables. I have a hard time believing it. I've watched keiki push meat and other dishes aside to pick out only the broccoli, cauliflower, asparagus, carrots, green beans, peas or peppers out of the meal, and forsake all the other food on the plate. The only thing keiki likes more than vegetables, is fruit. Sometimes we have to force keiki to eat the other foods.

- Since fruit is basically the only source of sugar in keiki's diet, keiki gets excited and squeals in delight at the mere sight of a banana, apple, papaya, nectarines, peaches, mango, pear, grape, strawberry or blueberry.

- Of course, everything we eat is cooked with either butter from grass fed cows, saved bacon grease and/or extra-virgin cocounut oil. All our food is and liberally salted with fresh ground Hawaiian sea salt. Other parents frequently comment on what a good eater keiki is.

- Same goes for keiki's Pediatrician. She cannot believe how we feed keiki when she asks about it. The only thing she says is that "I guess we can't argue with your results." That being said, I've had to continuously resist her recommendations to give keiki all sorts of vaccines (they want to give keiki 3 or 4 vaccines in a single sitting at almost every checkup! WTF? No, my child does not need the flu shot, the whooping cough shot, the chickenpox shot and the distemper shot right now...we'll take our chances, thanks!). Same goes for supplementing with fluoride. Why would I want to put that crap into my child?

- Oh yeah, I still sunbathe regularly, and most times keiki sunbathes with me in just a diaper. Keiki has never had a single drop of sunscreen applied. Keiki can frolick in our yard for 2 to 3 hours at mid-day with just a diaper on and has yet to get a sunburn. Ever. Same goes for taking keiki to the beach. Keiki has a perpetual, healthy looking tan (just like daddy! lol). Needless to say, I'm not worried about keiki's vitamin D levels.

- Some paleo purists might ask about whether or not we include intermittent fasting in our lifestyle? For a young child? LOL. I don't know many kids that can go for 6 hours without noticing they might be hungry, but keiki sometimes does. I don't try to force keiki to eat. I just wait until keiki gets hungry. But sometimes, keiki just isn't hungry and occupied with toys and playing around and doesn't think about food for hours on end. Lest anyone think I'm starving the kid, trust me when I tell you, keiki lets me know when it's time to feed the beast! But I  never feed the kid until keiki lets me know it's time. Sometimes I have to feed as soon as keiki wakes up. Other times, we don't have breakfast until keiki has been up for 3-4 hours.

In summary, the guiding principles I try to follow with raising a "Paleo Toddler" are this: Focus on real food, eaten until satiated. Get adequate, regular, mid-day sun exposure to ensure optimal vitamin D levels. Avoid consuming modern day, mass produced, industrialized toxins like vegetable and grain oils, high fructose corn syrup, cereal grains and flour, MSG, and other mass produced, processed food garbage.

It is my personal experience and testimonial that it works for small children as well as it works for adults!

Finally, for all the naysayers, disbelievers, skeptics and cynics who criticized or got offended last year, I will state the following: What works for me and my child may not work for you.

YMMV. N=1 and all that.

You may very well feed your kid soy formula, cereal grains and a vegetarian diet, and you kid may be the picture perfect representation of health. Awesome. I say that in all sincerity!

Perhaps you're lucky or just blessed with great genes.

Or maybe I am just mistaken, deluded and full of shit. Have a look around my archives, you'll see I've been called that a lot. I'm a conspiracy theorist whack-job that hates teh womynz! Why should you care what I have to say?

Move along folks...nothing to see here.

I'll keep on doing what I'm doing, and you can feel free to do what you do.

This is an anonymous blog and I am not trying to sell you or anyone else a damn thing.

I write on this topic, because I'm passionate about diet and nutrition. I was not a healthy baby. I have lifelong health problems for which I now believe are attributed to my poor nutrition as an infant. My keiki is now in the 95%-tile for height. Neither my wife and I were, when we were babies. I anticipate our child is going to grow up much taller and healthier than either of us did.

So far, I've put my hard-gained knowledge and personal experimentation with the Paleo/Primal/Archevore/Weston Price paradigm to the ultimate test - by raising my child on these loose proscriptions based on years of research and self-experimentation. Seems to be working as my child has avoided all of the problems I had when I was a kid.

Keiki is not perfect.

I'm figuring out that the "terrible 2's" applies to "paleo babies" just as much as it does to SAD fed kids. I also think I need to figure out this whole aggravating potty training thing. One other thing...a well fed, healthy kid can still throw wild, dramatic temper tantrums, destroy things and get into quarrels with other children.

I am not a perfect parent.

My kid is not better than yours. (Well...I might actually think so, but that's not the point.)

If you read this and that's what you take away from it, than please, go work on your reading comprehension and quit jumping to conclusions.

Offended? Good.

I believe I've gained some important experiences and knowledge, and share them with teh interwebz to help those who are interested and see the value in discussing the whole "Primal/Paleo" lifestyle. This is just my $.02

None of this should EVER be taken seriously. Feed your kids what the Doctors, Pediatricians and American Medical Establishment tells you to! It's your fault if you try any of what this blogger relates here and your kid turns out mysteriously well nourished and healthy!

(I think our Pediatrician thinks I'm lying when I tell her what we feed the kid).

For those interested in reading up on the sorts of things I've used as guidelines, here are some of the readings I found helpful for me:

Dr. Art Ayers Cooling Inflammation blog. Great blog overall, but this particular post discussing gut flora and the role it plays in digestion and nutrient absorption...and how infant formula fucks it all up, is a very important one - Why Discuss Mother's Milk?

The Weston Price Foundation has a wealth of knowledge on Infant Nutrition as well.

Peggy's the Primal Parent blog is also a great n=1 account regarding infant pre and post natal nutrition topics.

And I just discovered another good blog from Dr. Chris Kresser. You can check out his "paleo baby" advice here: http://healthybabycode.com/

And of course, the place were I send anyone and everyone that always asks me about "my special diet," Mark's Daily Apple is the starting point I refer all to.

For those about to have babies or seek to improve the diet of your kids, good luck!

Now I'm off to take "Paleo Toddler" outside to get some mid-day sunshine...

"Sun is Shining..the weather is sweet!"

let freedom ring

Some anonymous person found my blog, read my last post and left the following comment:


What you really don't like is the freedom that women fought valiantly for, and over a ridiculous amount of time, acheived. It's over little men, and your patriarchial utopia exists only in your dreams, and the ash heap of history.

Gotta love all this freedom we're experiencing. Thank you, oh valiant women who fought for this current utopia we are all living in for a ridiculous amount of time!

What's not to like about the new normal of all these broken homes, destroyed childhoods, rampant divorces, declining marriage rates, expanding police state, and a record number of incarcerated citizens? Surely things are so much better now! We are living in a milieu that is so obviously a vast improvement over the "patriarchal utopia" we little men are pining away for!

I'm truly grateful to have been given this wake up call from delusions of utopia by anonymous commentary at my blog! I had forgotten all of these freedoms women have valiantly fought for!

Let us recall all of these freedoms "...that women fought valiantly for, and over a ridiculous amount of time, acheived!"

The following are these hard won freedoms of the 21st century, empowered, liberated female, as noted by a former daycare worker, who observed the behavior, attitudes and actions of mother's and the children they used to pay her to care for, while they were busy enjoying all this freedom that valiant women acheived (over a ridiculous amount of time!):

We are free to take vanity to bizarre standards and measures – those created by the beauty, health, and media industries – that mandate skeletal thinness, life-long photo-youth looks, tanning bed skin color, Botox shots in the face, fake breasts, fake fingernails, waxing, manicured eyebrows, plastic surgery of every make and measure, bleached teeth, and unending and life-long diets. 

We are free to fall into the trap of the mandatory mental health industry – supporting big pharma and the New Freedom Initiative on Mental Health – by our addictions to anti-depressants to the tune of millions and millions of American women now zoning out on a daily basis with mood-altering drugs. 

We are also free to become useless in our homes. We now hire maid services, landscapers, pool cleaners, painters, interior decorators, cooks, nannies, teachers and tutors, caterers, therapists, party planners, massage therapists, laundry services, etc., while losing every intuitive instinct of our female natures. 

We are free to have extra-marital affairs, multiple lovers, to abort children, to disrespect and ignore the traditions of our families and religions, to use men like ATMs, to back-stab our friends and family members, and to take thousands upon thousands of family dollars for personal use in our missions to look like (and act like) teenagers. 

We are free to have children with as many men as we choose, and to bankrupt multiple men with mandatory child support payments.  

We are then free to ignore children by paying far more attention to maid-cleaned, spotless, and magazine-cover homes, where no cooking is achieved, no family memories are created, and no shoes are allowed to be worn on the white carpets of the “new” American home.

We are free to give our children computer software to keep them addictively occupied for YEARS, and then complain about their lack of social skills. 

We are free to completely ignore the FACT that our children are SUFFERING with mean-spirited and incompetent mothers – children who are hungry, starved for attention, and mistreated by non-stop extracurricular sports regimens, drive-thru bags of dangerous food, teachers and public school indoctrination camps, completely ignored spiritual needs, and disrespect and contempt of their children’s fathers.

These exercises in freedom were so commonplace, she ended up with enough material to write a book about it: The Cultural Devastation of American Women: The Strange and Frightening Decline of the American Female (and her dreadful timing)


And what has all this freedom created?

Sadly, this list has become the typical “home” scenario for America’s children and husbands. “Home” has become sterile because the women in American homes have lost their senses under the highly political guise of “liberation.” 

So, another question begs – what does liberation mean to American women? Does it mean the freedom to vote? Freedom from historical gender bondage? Freedom from ownership?

I don’t think so.

Today’s American female is free to be an idiot – a shallow, self-involved, pathologically vain, completely incompetent, and angry person – angry to the tune of making the anti-depressant industry the largest profit maker, bar none, for big pharma. 

Stupid is what stupid does. 

 

American children do not have happy homes. They are television and computer addicts thanks, primarily, to mothers. So sorry, but facts are facts. American children have so many video games, movies, and “equipment,” that we now have to have “media rooms” to contain the sheer numbers of purchases made to very purposefully ignore our children. 

Then add to the mix that American women can’t and don’t cook. They don’t know how, and furthermore, between jobs, beauty and “health” regimens, and chronic diets, today’s mothers feel like crap most of the time, which translates into anger in the home. 

Just ask dad (or boyfriend).

Most never think to ask. Then they discover this little sector of teh interwebz called the manosphere, and they're shocked that there exists people who are not enthralled with all this progress and freedom those valiant women fought so long and hard for. (Never forget, it was a ridiculous amount of time!)

Don't worry...just keep exercising your freedom! You need not worry about us men longing for our mythical Patriarchal utopia. That, as you correctly noted, is in the ash heap of history...along with all the other terrible things that went along with it - like orderly and civilized society, made up of stable homes and happy children.