Ron Paul on his new book “End the Fed”




Ron Paul: I’m Congressman Ron Paul and this is my new book, “End the Fed”.

Well, the next book came out this week, “End the Fed”, and we’re having a lot of excitement surrounding this and I’ve had a lot of interviews on this.

Today somebody asked me, “What should I do in this country to improve our economy?” My answer was very simple: End the Fed.

The Fed is the culprit and I talk about about that in this book and explain why the Fed not only creates our problems, they perpetuate the problems and the sooner we come around to understanding that, and first of course get the audit of the Fed, but eventually we have to end the Fed if we care about sound money, personal liberties, limited government.

This is the book that you have to read.



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247 Comments:

  1. Need everyone's help to pass this around it's Obama's connections to Acorn/SEIU
    http://www.youtube.com/watch?v=ULey3AaEuA8

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  2. Looking for patriots to help on the Kentucky front.
    http://kentuckyfight.com/

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  3. One of the benefits of having an intellectual at the helm of the Federal Reserve during this ongoing economic crisis is that intellectuals tend to leave a paper trail. Bernanke, famous for being a student of the Great Depression, is without question very well-informed on the relevant historical issues. His book reveals an intelligent and scholarly mind that does not shirk from the details but, rather, leaps without hesitation into statistical analysis of the most technical economic minutiae. The book simply wallows in charts, equations and log changes; the net result is impressive, especially when compared with his predecessor's lightweight, revisionist chronicle, "The Age of Turbulence."

    On the one hand, it is reassuring to know that there is a genuinely intelligent man in full possession of the significant historical information at the helm of the monetary authority right now. On the other, Bernanke's "Essays" serves as a reminder that even the most brilliant man's abilities are limited by the conceptual models he is using to understand the situation as well as by the data available for plugging into those models. For example, on several occasions Bernanke resorts to utilizing proxies, and in one case, a proxy for a proxy, when the data required by the model cannot be found. While this is perfectly understandable, it necessarily raises questions about the reliability of his conclusions even if one assumes that his model is flawless. The Misean calculation problem does not only apply to socialists.

    As one reads the book, four things about the present situation gradually become clear. The first is the recognition of the tremendous shock that the financial crisis must have given the Fed chairman. Because he places the greater portion of the blame for the Great Depression on mismanagement of the historical gold standard, it's fairly clear that he did not – and perhaps still does not – genuinely believe that another economic contraction of similar size is theoretically possible in its absence.

    "If the monetary contraction propagated by the gold standard was the source of the worldwide deflation and depression, then countries abandoning the gold standard (or never adopting it) should have avoided much of the deflationary pressure. This seems to have been the case. ... In summary, data from our sample of twenty-four countries support the view that there was a strong link between adherence to the gold standard and the severity of both deflation and depression." (pp. 78-84)

    The second noteworthy item is Bernanke's misunderstanding of debt deflation. He wrongly describes it as "the increase in the real value of nominal debt obligations brought about by falling prices." But he has it backward, as it is the refusal of borrowers to take on additional debt that collapses the demand required to support price levels. The Cash for Clunkers program was not enacted and the extension of the federal homebuyers credit of $8,000 was not proposed to decrease the real value of nominal debt obligations, they were designed specifically to increase those debt obligations and thereby increase both demand and prices. This misunderstanding indicates that Bernanke is unlikely to recognize the problematic nature of stopping the deleveraging process that has seen TOTLL, total loans and leases by the commercial banks, fall from $7.2 trillion to $6.8 trillion in the three months from June through August.

    The third point is the explanation for Bernanke's focus on the banks rather than the consumer or even the private and commercial mortgage holders. While Bernanke follows Barry Eichengreen's lead in blaming the gold standard as the primary source of monetary contraction in 1930 and 1931, he views "sharp declines in money multipliers (reflecting problems in the commercial banking sector)" as one of the major causal factors responsible for extending the depression after 1931. While those who understand that the problem is too much debt, not too little money, will rightly be skeptical of both Bernanke's historical diagnosis and current prescriptions, this does explain some of his otherwise inexplicable actions in supporting loan modification programs that help the banks rather than the defaulting homeowner.

    The fourth is the recognition that the Federal Reserve is not omnipotent and that Bernanke's ability to act is rigidly constrained by the economic circumstances. As the quoted paragraph about the Austrian banking problems of the 1920s shows, Bernanke is perfectly aware of the way that merging failing banks with still-solvent ones imperils the entire banking system, and yet the Federal Reserve and the FDIC have been addressing the failures of Bear Stearns, Washington Mutual, Merrill Lynch, Wachovia, and dozens of smaller banks in exactly the same way.

    The fact of the matter is that the global economy is far too large and complicated for any one man, no matter how intelligent and informed, or any one institution, no matter how rich and powerful, to control. The debt deflation scenario must play out eventually, and the sooner that Ben Bernanke and the Federal Reserve accept this and work to speed up the process rather than fight it, the better off the American public will be. It is far too late to save the banks, as they sealed their fate when they increased the average amount of loans and leases per bank from $71.4 million in 1980 to $854.2 million today.

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    • David B Daniels of Boston

      I think you have enough original insight to write a book. Thanks for some real wisdom.

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    • You have a huge misunderstanding of everything.

      "While those who understand that the problem is too much debt, not too little money, will rightly be skeptical of both Bernanke’s historical diagnosis and current prescriptions"

      When a country runs out of money, or capital, or when they have "too little money", they must result to debt or an economy cannot grow. Banks will go into debt with larger banks, and larger banks will go into debt with foreign nations. This happens naturally without any government involvement. In the past, we had the resources to grow our money supply. Now we have used up all our resources so we have to borrow from foreign countries.

      When we spend 8 trillion dollars overseas than we lose money that could have been invested into our country. Instead we have to rely on debt.

      Increasing the money supply can be good for a country. Just look at India for an example. India was a third world country forever until they dramatically increased their money supply over the past 2 decades.. Now their economy is growing at 10% per year. They are growing 3 times faster than we are. Same with China and Brazil.

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      • "it’s fairly clear that he did not – and perhaps still does not – genuinely believe that another economic contraction of similar size is theoretically possible in its absence."

        Of course he believes that another economic contraction of similar size is possible. Why do you think he went to such large leaps to increase the money supply?

        Also, he was correct when he said.
        “the increase in the real value of nominal debt obligations brought about by falling prices.”
        You just don't know what you are talking about. Nominal Debt increases when prices fall. When homes lose their value, debt then becomes greater than value.

        I could sit here and correct every word you said, you need to learn basic definitions and terminology before you try to step up against a Princeton Professor. I doubt you have good enough grades to make it into any college.

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        • That's why so many people walked away from their mortgages. Whenever their homes lose value, they are forced into paying money on a home that isn't worth as much. That extra money owed is called "nominal debt." SO.. Nominal debt increases when homes lose value. That is a true statement.

          Here, educate yourself a bit..
          http://en.wikipedia.org/wiki/Real_versus_nominal_value

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          • 'Essays on the Great Depression' - B. Bernanke
            published in 2000

            The subject is 'What did Bernanke believe previous to being blind-sided by this downturn and why did he not see it coming?'

            The writer was speaking to Bernanke's belief before the downturn, not after.

            p.s. The author is Vox Day

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          • Ben Bernanke was not blindsided by the downturn.

            He knew the whole time what he was doing. Even Keynesian's believe in the business cycle. Ben Bernanke more than likely helped attribute it so we could improve our economy. He wanted to put more capital into the system so we weren't running strictly on debt.

            This is not my conspiracy, it is a well known fact that central banks encourage business cycles to improve the economy.

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          • He was either blindsided or he knew what was going on and lied about it. Either way, he is not to be trusted.

            Ben Bernanke was Wrong
            http://www.youtube.com/watch?v=9QpD64GUoXw

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          • That's the thing about economists, they sometimes rely on data too much and not enough common sense for future predictions. He knew that something wasn't right with the housing prices. I'm sure most economists would have seen that as a threat. The same thing happened in Japan throughout the 90's.

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      • Sean.

        Your understanding of the money supply is staggeringly simple. However, there is hope. I used to write the same things you are writing.

        The main body of my argument is:
        "Human Action" "Road To Serfdom" "Meltdown (Tom Woods)" "America's great depression"
        and the Nobel Prize winning austrian business cycle theory...

        please rebut.

        What did you find contradictory or unsatisfactory about the theory? I found it to explain the business cycle quite well.

        Followers of the Austrian theory WERE the ones to predict the great depression... and the dot com crash... and the housing bubble, when everyone else was hollering, "Housing prices will NEEEEEVer fall".

        Regardless of the good intentions, introduction of new money to a static value base must have EXACTLY the same effect as if money were counterfeited by some scallywag and laundered through the bank. The bank gives out the money in business loans and home loans. These loans go to popular investments and screw with pricing and resource allocation throughout that market, sucking away productive individuals into bad investments that go wrong because all the prices of the contended for commodities just soared, and the good investments are now bad.

        If you believe that counterfeiting hurts no one in general, then I pray your reason soon recovers.

        If you believe that the intentions of those at the printing press somehow change the effect of the new dollars on the market, then you are just being stubborn.

        "If we call it LEGAL, no one will get hurt..."

        Seek Truth

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        • I believe our current dollar does not hold any value. The only things that have value are tangible items. People don't set their prices based off of the value of the dollar, they set their prices based off the value of their goods.

          All people say that the value of the dollar is determined by the demand for that dollar. The more scarce it is, the more it is worth. This is true to a certain extent, but we must understand that our current money is only used as a means for exchange. We don't actually demand dollars, we demand goods and services. The higher the demand for these goods and services, the more they will cost. Health care, education, housing, oil.. These are all high demand goods which the costs are rising so very quickly, but at the same time goods like electronics, clothing, and retail seem to have been getting cheaper. This is because the demand for them have gone down.

          Bubbles come from high demand sectors in the economy. Whenever people over invest in a market, the prices tend to go up because more people need to get their share of the pie. Yes, the federal reserve did cause a huge housing bubble from making investments seem more attractive, but this is something that could occur with or without the fed. The fed did contribute to the housing boom, but the costs of health care and education are mainly driven by the market. It was a combination of health care and housing that really caused the damage. The housing by itself made it expensive to live and then people got blown away by out of pocket health expenses.

          Some people may argue that health care and education prices are driven by the government but this is as true as it sounds. The reason why health care is as cheap as it is, is because there is a private market involved which negotiates deals. Just look at oil for an example, oil is not controlled by the government but the price went to over 150 dollars a barrel because of wall street and over investment.

          I do agree that the fed played a huge roll in our economic downturn, but saying that fed is the only thing that causes booms and busts is just incorrect. We actually had larger and more frequent booms and busts during the national banking era before the federal reserve was created.

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          • Some people may argue that health care and education prices are driven by the government but this is NOT as true as it sounds..

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          • The reason why health care and education are so expensive is because of the baby boom. The baby boom era is getting to the point where they need more medical attention, and to the point where they are trying to send off their children to school. The demand for these services are increasing, so will the price.

            Frosted Flakes will always be cheap because not everyone eats frosted flakes..

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  4. It's funny how the next G20 meeting is going to be directed in balancing out trade between nations. I wonder if the President of the United States knows something that we don't.... I think his exact words were that we need to stop purchasing items overseas with out nations credit card. I wonder where we have heard that before.

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  5. Donald Rumsfeld.The missing $2.3 trillion in defence.The day before 911 Rumsfeld declared that $2.3 trillion or $8000.00 for every person in the USA had gone missing without a trace.This represents 1/4 of the total defence budget pa.see; http://www.youtube.com/watch?v=xU4GdHLUHwU

    If $10 trillion is the total defence budget,then how can every person afford $32,000.00 pa in taxes to pay for it?For a family of 4 this is $128,000.00 pa! Someone has to be either creating money or a lot of debt in order to pay for it.

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  6. 2 Nobel Economists Confirm that Credit is NOT Created Out of Excess Reserves

    http://www.debtdeflation.com/blogs/2009/09/19/it%e2%80%99s-hard-being-a-bear-part-five-rescued/

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    • Since when did you care about whether or not someone has won a Nobel prize? I mean Krugman won one, so does that mean you listen to him? Nah, you pick and choose those who ascribe to your belief system.

      For that matter, what do the other 60+ recipients believe?

      Also interesting this article is advocating giving money to private companies and not banks? So you ARE for bailouts, but instead we should have been giving the money directly to private, non-financial firms? How would that have worked out in this system you distrust so much? You are now saying the government would have properly allocated $700B to private companies efficiently?

      Finally, if you ascribe to this article, does it not mean that you are actually saying that the excess capital the Fed has injected into the system will not cause inflation. That is a new stance for you. Oh wait, Austrians use a completely different definition for inflation, which this guy is STILL saying there is zero inflation occurring:

      "In fact, the expansion in M0 has been met by a fall in the credit-generated component of the money supply: since M2 includes all of M1 and M1 includes all of M0, this is clearer when we substract the double-counting out. M1 has actually contracted almost as much as M0 has expanded, while the expansion in M2 has been less than a third the size of the growth in M0."

      So all this hand-wringing about the Fed printing too much money is a myth and there really is ZERO inflation as a result of their actions? interesting.

      Keep posting those links, it is great fodder.

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      • I can only guess that your 'filter' takes no days off.

        I posted an interesting article for consumption, and you jumped to all kinds of conclusions.
        Turn off your filter for a moment, and read what was proven:

        -------------
        [Obama] justified giving the money to the lenders, rather than to the debtors, on the basis of “the multiplier effect” from bank lending:

        " ... the truth is that a dollar of capital in a bank can actually result in eight or ten dollars of loans to families and businesses, a multiplier effect that can ultimately lead to a faster pace of economic growth." (page 3 of the speech)

        This argument comes straight out of the neoclassical economics textbook. Fortunately, due to the clear manner in which Obama enunciates it, the flaw in this textbook argument is vividly apparent in his speech.

        This “multiplier effect” will only work if American families and businesses are willing to take on yet more debt: “a dollar of capital in a bank can actually result in eight or ten dollars of loans”.

        So the only way the roughly US$1 trillion of money that the Federal Reserve has injected into the banks will result in additional spending is if American families and businesses take out another US$8-10 trillion in loans.
        --------------

        It's that daisychain of debt that get's you excited?

        The inflation is in the system, it just has not filtered down yet. Keynesianism is on the fast track to hell, as illustrated in our current economy. Even with it's steadfast supporters, like yourself, it's demise is guaranteed.

        Do you not pick and choose?

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        • The federal reserve didn't inflate the dollar any more than banks would have through debt. Instead of banks inflating the currency through promissory notes, the fed inflates it with actual dollars, because actual dollars is more stable than debt. Either which way, money is still being created through banking transactions, inflation will be the same except there will be less contraction of money because there will be less debt, which will actually make the system more stable.

          Inflation is determined from how much money is in the economy, not how much money is sitting in banks. Banks are the ones that create money and put it into the economy. Money can be either debt, or actual dollars. The fed is trying to flood the market with actual dollars so banks wont lend out as much debt.

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          • When more dollars go into the same market it means a dilution of the dollars already in the market, you get inflation.

            The inflation is being seen in food and fuel which are not represented in the CPI (coincidence?), and they have barely begun to release these dollars.

            Get ready for the next wave.

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          • I don't think you get what i'm saying. First you have to understand that IF the federal reserves dollars didn't go into the market, promissory notes would instead. Either which way, new money will be introduced into the economy, either as debt or value.

            The fed doesn't put money into the economy, banks do. Either the banks can put debt into the economy or they can put money.

            The difference is that debt requires interest to be paid back and that is money that wasn't created during the whole promissory note process. Debt actually takes money from the economy where value lets it circulate forever and forever.

            If nobody creates money, than banks create it based off of IOU's(debt)... Maybe you should learn some of this stuff before your strut around like you understand any of it.

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          • Speak to the specific flaw described here:

            ".... the only way the roughly US$1 trillion of money that the Federal Reserve has injected into the banks will result in additional spending is if American families and businesses take out another US$8-10 trillion in loans."

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          • No, its going to be harder to get a loan because they are only going to accept good credit scores and they are going to set capital requirements. It's not going to flood the market if it carries sounder policies.

            And that person doesn't seem to know the difference between capital and debt.
            It may be 8 trillion in loans over a long period of time, but thats loans with money instead of loans out of thin air. There is a huge difference, which you are misunderstanding.

            If you were to create money instead of creating debt, you don't have to pile debt on top of debt, you can just reuse money /

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          • Banks can either lend out debt, while piling debt on top of debt, or the fed can make money and have banks loan it out so they can reuse that money in circulation.

            When you create money out of debt, there is always interest on the debt which is taken out from the rest of the economies money. Instead of continuing to "re inflate the bubble," they filed up a bunch of balloons and tied them off.

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          • What the fed did was pretty much an overhaul of the system. It's a whole new era of banking. Financing is going to be completely different. They took us from a debt driven economy to a capital driven economy.

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          • Just as it is disastrous to create "actual dollars" out of thin air, so it is disastrous to create debt out of thin air. The former leads to inflation; the latter to artificially increased "value" [what many people also like to call inflation]. Neither will "actually make the system more stable" in the long run.

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          • BAM! hotfive knocked that one out of the park.
            So simple and concise.

            For those that can handle the truth:
            http://www.youtube.com/watch?v=7ukJiBZ8_4k&feature=player_embedded

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          • No hotfive.. In the past whenever there was capital requirements, if you were to up the money supply, banks were able lend more, putting more money into the economy.

            Because we haven’t had capital requirements, banks could just lend all the money they wanted. They could lend money they didn’t have. “credit out of thin air.”

            Just because the fed upped the money supply doesn’t mean that banks will lend more. Banks were already lending at their max capacity inflating the dollar as much as possible with “credit out of thin air.”

            Now they are going to have stricter capital requirements where they can’t just inflate the dollar by putting money into the economy. They can only put in so much money with capital requirements. It’s basically limiting the money supply, just as a gold standard would have done.

            The reason why the fed had to give them capital is because they practically had none. Our money gets spent overseas, 8 trillion dollar trade deficit.. That’s why we eliminated capital requirements in the first place.

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  7. David Icke "What is Money?"
    from Radical Truth Knowledge and Revolution
    http://www.youtube.com/watch?v=peiTfY7Bx4c

    This video really makes you think about money. One day we will not buy and sell...because we won't use money. So if the dollar crashes, so what? Will we stop what we are gifted at doing that contributes to society? We don't really need the illusion of money anymore. It's a tool of control to produce have's and have nots. Listen to all the wasted conversations, time and energy spent on the topic of money as it intrudes on human issues...housing, healthcare, personal income, food, dreams and goals. We could have it all if money were not the limiting manipulated factor that it is.

    We will have a humanitarian-based society when we finally advance and desire a superior level of living, become willing to let go of what is NOT, NOT working. One day, everyone on the planet will have what they need and no one will be without their basic needs and more. We may be approaching this time sooner than we think... 2011-2012?

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    • This is a quaint notion, however, it is an impossibility. Money is not a limiting factor. It is the exact opposite. It is an advancing factor. It enhances trade. Without money, individuals are relegated to barter and subject to its many problems. Money is the solution to these problems. Money elimintates the double coincidence of wants and allows for saving capital accumulation and diversification. People use money in order to perform accounting and price goods/services. This is essentially impossible under barter.

      You ask "So if the dollar crashes, so what? Will we stop what we are gifted at doing that contributes to society?". As a matter of fact, yes, many people will stop what they are gifted at doing. Not because they want to but rather because economic conditions will force them to do so. Under a barter economy (an economy w/o money), the division of labor remains very limited and primitive. The use of money allows for a much more complex and advanced.

      There is no way (other than force) to prevent money from arising. Money emerges naturally on the market. That is, it emerges through the voluntary exchanges of individuals.

      Keep in mind that when I say "money" I mean REAL money. I do not mean the worthless paper currencies of governments/central banks. By money, I mean the most widely used commodity. The market tends to select gold/silver as money for very good reasons.

      Sorry for the rambling response. I'll try to find some articles explaining the function and benefits of money and post them.

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      • "You ask “So if the dollar crashes, so what? Will we stop what we are gifted at doing that contributes to society?”. As a matter of fact, yes, many people will stop what they are gifted at doing. Not because they want to but rather because economic conditions will force them to do so."

        "...because economic conditions will force them to."

        The error in your thinking is still stuck in "economic"...money-based beliefs that money should control. I say, the heart and humanitarian beliefs should guide. Every good deed and contribution would be pursued without limitation. We would see an entirely different world and the people who wish to finally express and address humanitarian issues would do so. There is plenty of work to do and we would all gladly contribute, especially after such a stark contrast to the financial crisis. The realization of what we have allowed our beliefs in money to do to ourselves, each other and the earth is shocking. I believe people would experience a freedom we have not known for eons. True creatives don't look for articles to support their beliefs...they just acknowledge that there has to be a better way and think for themselves.

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        • How is anyone going to express and address humanitarian issues without money? These things that are done with the help of money.

          If you think a society can get along without capital or money, you should move to Africa.. I would say the people in Africa are more friendly, but they can't do anything with their lives. I guess you would fit in perfectly.

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          • Keep thinking that thought...How would we address our needs without the use of money? You may come up with creative ideas. An different idea is firstly ignored and attacked.

            Exactly...people in Africa...the problem exists because they are without enough money to meet their human needs.

            Because there are those who lord over others in pursuit of oil and resources who do have money and their decisions are born from a money-based system for profit and control...to serve themselves. That is the very corruption I speak of.

            The monetary system is in place to create haves and have nots whereas in a humanitarian-based society, everyone's needs are met and we prosper even down to our souls from the work that is pursued to better this world and planet we share.

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          • Your speaking of two different debates.. One debate is thousands of years old from figures like Plato and Aristotle about the usage of money. I think we figured out that money is more productive and carries societies much farther.

            Another debate that started during the Renaissance was about corruption from those with too much money and the necessity of laws to protect the people.

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          • Our collective consiousness will eventually rise to the occasion. We run through this repetition of things that are not working until the day it dawns on us that the pain and suffering caused by a system of things has no real value to us anymore, that we value ourselves and the planet so much more than to keep perpetually denying ourselves true freedom through one disasterous belief after another.

            Because this is the way life has become is no reason to maintain it. We were born with minds to think freely, creatively and to be free. We are to learn from our mistakes and move to higher levels of living. We may be approaching this time soon. Choose a microchip and remain limited and controlled or opt for a humanitarian-based society. Which is it?

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          • Show me a person that would not accept a million dollars if handed to them, and I will then agree that money is not wanted or needed.

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          • Sean, you are still stuck in the mentality of a money-based system. Unfortunately we still live in one. Nothing has changed for the better, yet. We may be forced to face a decision here soon.

            How about envisioning no need for millions of dollars or even one cent. You just go right ahead and pursue your dreams free of charge. We all just get up and go make our personal contributions to the betterment of society using the gift and talents we each have without the limitation of money. You choose which gifts and talents to develop in your lifetime, knowing yourself better than any other. You would not be choosing a pursuit based on profit, but on filling a need in society to improve life here on planet earth. You are free to create whatever would contritute positively to the planet and humanity wherever worldwide. The needs to fill are great thanks to the monetary-based system!

            Just think of this... The people who hoard most of the world's money are in the minority. The people doing with a lot less and without are in the majority. If collectively the majority filled their minds with the new vision, that would be enough power to change everything and overwhelm the minority. With a new humanitarian-based system, we would no longer be serving the elite and instead flip it to serving the areas of greatest need, having our own needs met freely, and enriching ourselves on a spiritual level at the same time. And humanity and the planet rise to a higher level of living rather than daily dealing with the harsh reality and ramifications of the elite minority ruling the planet and our lives. When we decide not to give our power away to the minority any longer, in this way, and armed with new and better ideas, that will be the day we come alive and are truly living. The money hoarding minority would be zapped of their power and control over others. They could spend days counting their money, but it would be reduced to the meaningless pieces of paper that they are. Power shift 2012 or sooner.

            Rather than round tables full of bankers and gangster politicians who meet in secret deciding what will be for the rest of us, we would replace them with people who come together to share creative ideas, ideas and plans that exhibit our readiness and willingness, fully capable of taking care of ourselves, each other and our tiny planet.

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          • Everything you just spoke of can be achieved with or without money.

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          • What about property rights? Without money to purchase land, anyone could run up in your house and take it over. Who is to say what is and what isn't yours to own if you did not purchase it? If you find some land to live, it's just as much yours as anyone else's. It's not first come first serve, that just wouldn't work.

            Without the corruption of money, we would see corruption in totally different ways. Money is not the root to all evil.

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        • Meh. Enjoy your delusions. Economic dose not mean "money based beliefs that money should control". Indeed, you are actually arguing for an ecnomic system. It has already been thought of and written about. It's called a "gift economy". Go ahead and look it up. Your "true creatives" admonishment is as childish and naive as your belief that money is a limiting factor. Some of us are humble enough to admit that we don't have the answers. Hence, we turn to others and seek their advice and insight. Apparenlty you are arrogant (or deluded) enough to imagine you can do work out everything for yourself.

          You have provided no argument that people WOULD follow their "heart and humanitarian beliefs". Has this ever happened in all of history?

          You don't realize that it is not sound money you are arguing against but rather fiat currency. Do you not see the difference between irredeemable paper (government fiat currency) and real money (a commodity like gold/silver)?

          What would prevent money from emerging naturally on the market as it inevitably does? What would prevent the free and voluntary exchanges of individuals from discovering a medium of exchange (money)?

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        • Money should not control, anymore than a car or a hammer should control. These are tools.

          Money is not the root of all evil, but the love of money that tempts.

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          • What can money provide? Money can provide security and pleasure. These are the things that encourage corruption which would still be there, even if there is no money.

            People would steal to eat, and people would kill someone and take over their home. There would be no police to prevent these things, because there would be no tax dollars to fund it.

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          • Sean, people would steal to eat? Steal what if we didn't live with this horrible money-based system of life. this money-based system does not give us security or pleasure!

            Do you understand the mind shift that would be involved in going from a money-based system to a humanitarian one? No one would be interested in stealing or robbing. That mentality comes from the money-based system. If everyone could just have what they needed, no one would be interested in taking from someone else. This would be a giving society, not one based in greed as in the money-based system.

            Longshotlouie, you're right, it is the love of money that is the root of evil...and evil is abundantly clear.

            When we have people and governments worldwide who are willing to convince populations to have a flu shot for a non-existent pandemic and add to the ingredients disease causing elements to cause people to buy more drugs for more illnesses so the corporations will make a profit, that is evidence that the monetary system is not designed FOR you and me. Rather, it is something that works against us and our right to life, liberty and the pursuit of happiness.

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        • Offer someone freedom and they opt to continue to be controlled, stollen from and manipulated so a few can profit and live well.

          You think people own their property? No they don't. The tax system designed by the moneychangers keeps collecting property taxes forever and mortgages are not designed to be paid off, the majority never do. All for profit.

          I imagine a world where what is produced is necessary not because someone needs to do something to make a huge profit. So many resources are used up and wasted due to this profit mentality, so much harm is done to people and the planet. I mean, do we really need a cereal isle for everything and then unnecessary. If big corps didn't have to pay off shareholders and pop off the assemply line just anything that will sell, we could actually produce things of real value.

          It's a very different lifestyle when everyone is working for the good of all and the planet.

          When the financial crisis hit they said spend, spend, then people were told to cut back on credit spending, then lost jobs, no money to spend, lost homes, but still the mantra is spend and boy is our government spending on borrowed money! It's all craziness. To have a politician tell us to go buy something, to just go spend, is a little over the top. We buy as we need and when we can afford it and on what we value.

          Nate, you say delusion...when so many are deluded in the illusion of money. It's paper, printed out of thin are and they decide the value, not you, even though you are the one who works your butt of for it, just like the hampster in the cage, round and round, faster, faster. They they take what you make and leave you a little to get by on. What a system and an unfortunate state of affairs our world is in because of it when we have such great potential...potential that will never be tapped into unless and until....

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          • I'm not like dissn your utopia. I just think there is more to life than peace and hippies. I believe in capitalism. I don't think you should become a slave to your job. I believe you should do whatever you wanna do with your life, and I want there to be that opportunity for you, me, and billions of people across the world.

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          • I know that we have come to accept "paper printed out of thin air" as money. But it is not money if we are to use the word properly. Again, you are arguing against fiat currency not sound money. Sound money is the answer.

            Care to respond to any of the questions I posed? I would sincerely like to know how money would be prevented from emerging naturally on the market. As I see it, you are caught in a bind. You want people to be free but you also want a world without money. This is an impossibility. Why? Because if people are free to act, money will eventually emerge as a result of their free actions.

            Please share your thoughts.

            On the origins of money...http://mises.org/resources/2692

            Also, you appear to be disgusted by profits/the profit motive. In a free market, profits indicate efficiency and wealth generation. Here...http://www.hacer.org/pdf/Hazlitt00.pdf read chapter XXI "The Function of Profits"

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          • I'm for doing away with the whole idea of money fiat or sound, doesn't make a difference. It's a total illusion that has been created and we have ascribed value to pieces of printed paper, electronic blips, sea shells, fractional reserve banking (money that does not even exist (illusion) is loaned for interest payments (real money earned), that's how artifical this whole thing is, yet it controls so much and we have believed in the illusion of it). Let's pull back the curtain to see OZ. It's almost ridiculous to even talk about it. The value is maniuplated by those who control its value, depending on what mental/financial/emotional state they want to put a population in so they can make people desperate for a change they would never otherwise agree to, make countries indebted to them so they can control their resources and take them over. It's insanity to support such a destructive system in favor of a few!

            With either fiat or sound money we are dealing with making decisions based on profit and the whole 9 yards that goes with the system including the ever present corruption and elite controllers. It's gotten so bad that our basic human needs are unaffordable. Is that a system that people can live with or are we just tollerating something that needs to be replaced with a more humanitarian-based system that actually allows us the freedom to enjoy life and pursue our dreams and goals unhindered? We need to value ourselves enough to create a system that serves us well, not tollerate one that takes our life, liberty and freedoms away. We need a system that allows us to have genuine meaning to our lives, not one that just supports a few crazed elite families so they can live well while they tax our wealth unto death to use it to destroy other people's lives and countries worldwide. It's a little one-sided wouldn't you say?

            Money would not resurface after people had a taste of life as it is suppose to be lived, when societal problems disappear. Think of all the societal problems we pay for that stem from the concept of money. Think of all the convesations, the arguments, the time spent discussing issues, bottom line is, it's all about money. Money, money money. Start talking solving a problem and sooner or later the topic will get around to money.

            The for profit idea causes us to produce products that will soon break or are inferior on purpose so they need to be replaced to make even more profit. Pretty wasteful I'd say. That waste is expensive! Landfills galore. When will we stop filling the ground with our crap or China's crap?

            How about a society that produces only what it needs to be conscientious and preserve the earth's resources? Hmm? There's not much profit in it, but hey, we need to start thinking this way.

            Be inspired.
            http://www.youtube.com/watch?v=61BCB2-OmRY

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          • So apparently you're hoping for humans to have a mass trancendental experience after which they will shun the concept of trade and, by extension, money. Yeah I won't hold my breath for that. Got any examples of this happening in all of human history?

            I watched the video you linked. It was good but not very inspiring because I already hold many of the views espoused.

            If people are not restricted from trade, money will naturally emerge as a result. Sound money works against all the evils of which you speak. It is a protector of property rights and civil liberties. Sound money is free of the manipulative control that you rightly despise.

            Namaste.

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          • Likewise, show me where sound money exists and where corruption is non-existent with the use of money. That's an illusive thought. It does not exist anywhere on the planet.

            The humanitarian-based society exists remotely. They are free of the stress produced by our financial practices that you and I face every day. They are happier, healthier people for it. I envy them and wish their guides to living fully were pervasive throughout the world. We think we are advanced here in the U.S. because we have more stuff, but that is not advancement. We think we are advanced because we have an organized government, but it is full of criminals, so that is not advancement. We constantly hear how the U.S. is the richest nation, but we are in debt to China and many other countries, and our finanancial system is full of criminals, so that the government and corporations may be rich, but the average person is not. That is not true wealth. We have the finest medicine available they say, but it is not financially available to most Americans. Alternative methods that actually help the body heal are discouraged rather than supported. Our food is full of chemicals and so is our air with chemtrails by our government, the organic farmer is under attack...so health in America...it does not promote nor practice true health. All this because of profits for big pharma, bankers and gangster politicians.

            Some day....some way...we will need to change our ideology to a system that serves our human needs to the highest degree possible so we can live more fully here in America and around the world. And it won't be accomplished with money. It will be accomplished through hearts of those who care more about each other an the planet than profit. The corruption behind much profit is the source of many human problems. Perhaps we will only change or wish we had when there is no other choice, or when we have lost all ability to make a choice.

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          • Some how...some way huh? This is probably the biggest shortcoming of your vision. How does this ideal state of yours emerge?

            Just FYI, you continue to develop laundry lists of problems (chemicals in our food, alternative medicine shunned, pollution, etc.) that will never be fully solved. The solution is either government (force) or the market (freedom). And again, money will emerge out of the market. Unless "some how...some way" people transform into perfectly benevolent beings.

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          • It emerges in the hearts of those who have humanitarian thoughts, who are benevolent beings. Those who value life, not the dollar.

            The system you defend is a design for human demise and the earth's demolition, pervasive unhappiness, illness, greed, corruption, theft, world domination by a few who have no morals, war, death of untold millions of people senselessly and needlessly, starvation, attacks on households at the whim of the elite. All this from imaginary concepts of value placed in the exchange of pieces of paper or electronic blips. And we let that happen when we refuse to change from supporting such a system, also guilty of the untold crimes against humanity by belief.

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          • You are playing a very disingenous game. You keep strawmanning my position. I do not support the current system of paper money and electronic blips. I have made that abundantly clear. What I am questioning is the belief that people will be lead by their "heart and humanitarian ideas" and will not employ money to enhance their exchanges. If they are free to act and trade with one another, money will emerge as a result of those transactions.

            In the end, this little disagreement is trivial. If you want people to have their freedoms and their rights to life, liberty, and property but no one has the right to infringe on the rights of others, then we have no significant disagreement.

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          • We shall see. This monetary system is going to get full exposure for what it is. It will shock some people and challenge beliefs they curently hold that are tied up in lies and deceipt. Some of us have gone into it searching for the truth whereas some will be hit by the truth and in both cases eyes will be wide open. Then, they will turn to following their own hearts and put aside the foolish notion that governments are honest and were set up FOR the people, that wars were to keep us protected from outside terrorists and instead come to know the FED, the elite, corporations and governments have used the people for their own personal gains, disregarding the many. It is apparent that they no longer listen to the true desires of the people. Very few in politics, and Ron Paul is one of them, are honest and don't seek authority to rule over the people in an arrogant way, but serve in a manner that is heartfelt and consistently true to the guidance in our country's founding documents. I applaud such a humanitarian.

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          • We shall see? What the hell is that supposed to mean? I don't have the slightest support for the current monetary system. I recognize the it for the fraud it is. You are again (tacitly) attacking positions I do not hold. Very strange. And why even bring Ron Paul into the conversation? Especially as support of your "humanitarian" views? I assume you have End The Fed. Have you read the chapter explaining "Why we should end the Fed"? He basically lays out the complete difference between sound money (commodity money like gold) and fiat currency (Federal Reserve Notes) and states that money naturally emerges out of barter in order to facilitate trade. Those last few words are almost lifted verbatim. Keep hoping for that mass enlightenment. Can't hurt to hope I guess.

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          • and what if America doesn't have any gold? That is possible. Then what?

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          • Just to be clear, the argument is not "the government should outlaw FRNs immediately and decree that only gold is money". That would be much too economically problematic and, more importantly, would run contrary to the idea of liberty.

            Now to your question...

            You ask "what if we don't have any gold?". An answer is actually in the very chapter I mentioned (Why We Should End the Fed) and can also be found in plenty of other books/articles. Anyway, this is not a problem for a few resons. First, the new market selected money would not necessarily be gold. Just let people freely trade and allow for competing currencies (repeal legal tender laws) and see what the market selects as the preferred money. Gold/silver tend to be chosen as money for very good reasons. But we'd have to see if that came to pass. However, it is essentially impossible that the market would choose unbacked paper splashed with ink (Federal Reserve Notes) as the preferred money.

            Also, it is very important to remember that money (even if it is gold) is not wealth. Wealth is measured by the goods an economy produces and by productive capacity. One is not helpless if one has no money (gold) so long as one is wealthy (has goods/the ability to produce goods/services). Perhaps it is actually your recognition of this (money is not wealth) that leads you to think that money is an "illusion". Anyway, I think that chapter (Why We Should End the Fed) will prove instructive. Enjoy.

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          • Money is an illusion. You only have to look at fractional reserve banking to see this is true. Money is an idea that someone created as are all the financial products like CDOs.

            We are humans with daily needs for good food, water, shelter, clothing. If money was such a great idea and a real solution, then everyone on the planet would have good food, water, shelter and clothing, but in all of our existence, we have never achieved this. Why? We are to take care of the planet, but in all of our existence, we have not achieved this. Why?

            Money is not a solution. We go off to work to be responsible for our needs, but politicians in Washington and in other governments meet to decide how our personal share of the money will be spent (and we pay them well to sit in endless discussions to do this to us which subtracts from our wealth!). Those who control the value of money, the elite FED, are guilty of theft all the time in many ways. Not only that, but they create a climate of wars for oil for their own personal financial gain (a few) and loss of human life, the devastation to countries.

            There is enough on this planet for everyone and yet, we still have not achieved this level of living, nor have we achieved peace. We could have a society where everyone contributes to the building of good living everywhere, but we don't. We opt to be stuck in the confines of the idea of this game called money. The game has winners and losers. That is no way to live. In a humanitarian-based society, we all win. What affects one, affects us all. I look forward to the day when there is no such thing as financial class (rich, middle, poverty), that it is rendered totally meaningless. We are all humans with human needs that deserve to be met. With all the so-called advancements, we have not advanced as a human race unless and until we have achieve this level of living.

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          • That's a lot of oysters and no pearls.

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  8. I just ordered Ron Paul's new book. He is an inspiration to me.He is also a hero to my youngest son. Im not political minded but my son got me interested in him. I was amazed how corrupt things are. I hope to educate myself and really appreciate the injustice that exists in our government.

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  9. Is America Hooked on War?
    http://original.antiwar.com/engelhardt/2009/09/17/is-america-hooked-on-war/

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  10. I just received this email for tracking 833/1207

    You are currently monitoring: H.R. 833: Federal Reserve Board Abolition Act, H.R. 1207: Federal Reserve Transparency Act of 2009.
    Congress is in session today.
    Sep 15, 2009 - House Debate
    Auditing the Federal Reserve Is Long Overdue
    http://www.govtrack.us/congress/record.xpd?id=111-h20090915-78

    Excerpt: "...it was announced earlier today that there will be a hearing on H.R. 1207, the bill to audit the Federal Reserve Bank. This will be the first independent audit in the Federal Reserve's 96-year history, and it's long..."

    "The right of representation in the legislature [is] a right inestimable to [the people], and formidable to tyrants only." --Thomas Jefferson: Declaration of Independence, 1776.

    Gotta love Alan Grayson and Ron Paul.

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    • More from Alan ....
      http://wallstcheatsheet.com/knowledge/interview-knowledge/exclusive-interview-congressman-alan-grayson-talks-fed-transparency-and-missing-money/?p=1878/

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  11. It's Official !! Peter Schiff is running for Dodd's Senate seat, and

    World Wrestling Entertainment Inc. said Wednesday that Linda McMahon has resigned as the company's chief executive to seek the Republican nomination for the U.S. Senate seat now held by Connecticut Democrat Christopher Dodd.

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  12. Make a slide show for pre processing of the messy/manipulative subject of economy for the more general audience. It will make easier processing a longer book. Make it factual and backed up with real data. Like a prelude to the book.

    At least part of the main information will reach a larger audience, if it costs a small amount and can be downloaded, and it might get more people interested in buying the book.

    I don't trust anyone any more, and there's too much information going around, so I would make very professional, simple, and accurate.

    I hope you read this message.

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  13. I'm about to go buy my copy.

    Sean,

    Will you be buying a pile of copies (like you claim to have done with The Revolution) and distributing them to your friends and family? Enjoy.

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    • I'll probably buy a copy. He covered the fed in his last book so i'm not going to try to make everyone read this book too. I just started reading one of JFK's books. He's the most well spoken president we've had in the past 150 years. He's a true conservative liberal.

      http://www.youtube.com/watch?v=xE0iPY7XGBo

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  14. What people don't understand is that the primary architect of the Federal Reserve System , Paul Warburg , was basically a Nazi . Warburg was on the Board of Nazi Chemical giant I.G. Farben's American subsidiary American I.G.. Warburgs brother Max was on the Board of the Reichsbank and part of the German Secret Service . Their basic concept was to destroy the Country , which they have been systematically working on since 1919 . In 1933 under the advice of Warburg's son , Felix , F.D.R. confiscated America's gold . It was shipped to Germany . A Congressman Louis T. McFadden protested but was ignored . That's how Germany stableized it's economy years before America during the Great Depression. Everyone needs to support Congressman Paul big time. Go Ron !!

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  15. Thank you sean, for proving our point.

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    • Proving what point?

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      • Is this the same sean that keeps telling us that we cannot survive without perpetual debt?

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        • Omg you too! Stop twisting my words around. I say that we need to be more productive and or import less goods in order to have any sound monetary system. I don't favor perpeptual debt. I don't believe we need perpetual debt to survive persay.I say that we got off the gold standard and the government encourages deficit spending to replace the money spent overseas, and that is something we should stop! You can agree or disagree with what I say but do not try to outwit me or outshow me by saying that I'm a socialist or anything like that.

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  16. Mattsean, what is your motivation for backing a failed monetary system? What is your motivation for your derisive remarks to those that get their life savings confiscated by such a system?

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    • You are the one who favors debt, as long as it's not "excessive" debt. I am quite the opposite, I favor a hard currency but see many obstacles in the way. I just said that it's healthy for banks to slow down lending via inflation.

      Why must you twist things around to make lies. That is very pathetic.

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      • Now you simply lie to harden your argument?

        You cannot back the Fed and believe in sound money.

        I notice, again, that you do not answer the question.

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        • Yes I can. I'm sure Ben Bernanke believes in sound money as well. I bet everybody believes in sound money, who wouldn't?

          Believing whether or not we can just switch back to sound money without being a productive country is a different story which does not change the way I feel about a hard currency. I still have strong beliefs. I wouldn't say that we need to live within our means a million times if I felt that we could live off credit for the rest of our lives. Even Ron Paul said one of the first things we need to do was live within our means.

          Any more lies?... Pathetic.

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          • Still did not respond to the question. Nothing new here.

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          • I am not backing a failed monetary system. I'm sitting here promoting a hard currency. Answer me this, what is your motivation for backing a failed monetary system?

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          • Why are you such a socialist longshot? Why do you support government takeover in the banks? AND in health care?? What is your pathetic motivation?

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          • Poor Sean, hoisted with his own petard.

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    • How do you not get dizzy and fall down with all of your circular arguments?

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  17. A Letter to France

    by Lyndon H. LaRouche, Jr.

    September 10, 2009 (LPAC)-- At a time when the entire planet is on the edge of a menacing crisis far worse than that of the Fourteenth-century "New Dark Age" launched by Venetian monetarist interests, we are faced with a global situation for which only a close alliance among the four greatest nations of the planet, the U.S.A., Russia, China, and India, can lead the world as a whole out of the immediate threat of the greatest, planet-wide new dark age in the known history of mankind.

    The most significant of the by-products of that crisis, is the effect of a virtually criminal decision shared by the governments of the United Kingdom, France, and the U.S.A. of President George H.W. Bush, during 1990, to crush the reunification of Germany under terms tantamount to the Versailles conditions which caused the 1923 hyperinflation in Weimar Germany, and made possible that then-pro-fascist British monarchy's initiative which brought Adolf Hitler into power in Germany. The crisis of Europe today, is largely a by-product of the creation of the conditionalities which led to the virtually British imperialist dictatorship of the Euro over continental western and central Europe by, chiefly, the parliamentary regimes of Prime Ministers Margaret Thatcher and the notoriously lying Tony Blair who authored a new long, Sykes-Picot war in the Middle East.

    The present phase of the chronic crisis of the post-de Gaulle France, is, in significant part, the ruin of the de Gaulle-Adenauer pact projecting a "Europe from the Atlantic to the Urals," a ruin, leading into that subsequent assassination of U.S. President John F. Kennedy which was an Anglo-American financier oligarchical faction's response to President Kennedy's adoption of the policy of U.S. General of the Armies Douglas MacArthur's warning against involvement in new "land wars in Asia." With that assassination of President Kennedy, the world as a whole entered a deadly new long-ranging crisis which has brought the entire world and its affairs into the present conditions of an imminent general monetary breakdown-crisis of the entirety of this planet, a crisis which, unless reversed almost immediately, means the plunge of the entire planet into a dark age, for a generation or, probably, more, to come.

    Presently, there is no remedy for any nation of this planet as a whole, except attacking the problem at the root, the root typified by the monetarist ideology traced to the Berlin Germany, first edition of the pro-fascist, general theory of monetary imperialism supplied by the Briton who was to become the leading adversary of U.S. President Franklin Roosevelt at the 1944 Bretton Woods conference, John Maynard Keynes.

    It should be clear, that the extremely fragile present stage of the U.S. Obama administration is the only remaining obstacle to anti-monetarist alliance of a group of nations gathered around an anti-monetarist, unified policy of revolutionary action by the governments of the U.S.A., Russia, China, and India, and those governments which would soon join such a new partnership for a general, global economic recovery from the presently oncoming, global catastrophe. The August 2009 outbreak of a true "mass strike," which has broken out among a majority of the U.S. citizenry, signals the existence of the preconditions for such cooperation among the U.S.A., Russia, China, India, and other nations.

    It is urgent that the leading nations of western continental Europe, France, Germany, and Italy, be freed, as one, from the grip of what Thatcher created, so that a truly planet-wide recovery of the economies, under a credit-system, rather than yet another, intrinsically imperialist monetarist system, be established to lead a true recovery of the economies of the planet as a whole.

    That message from me should be brought to the attention of the relevant figures of the Socialist and other parties of France at this time.

    — Lyndon

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  18. what a peice of crap this country has become, thanks to the people in gov. with their hands in the cookie jar

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  19. If you are not pissed off, then you are not paying attention.

    Seven Hundred Billion Dollars ($700,000,000,000.00) was allocated to get the toxic assets off of the books of big banks. Guess what!
    The toxic assets are still on the books of these big banks.

    So they took $700,000,000,000.00 out of our pockets, and out of our economy, FOR NOTHING!!!!

    Only sheople would not be up in arms at this point.

    Talk to me.

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    • Not sure what this has to do with the Fed, but since some of y'all think all of the evils in the world are attributable to the Fed, sure I'll talk, and educate.

      First off, it was not 'for nothing' Louie. Anyone with half a brain could see through this baseless rambling. If you wish to make valid points about, say, the mechanism chosen that is one thing, otherwise to say something as ridiculous as "FOR NOTHING" only makes you look biased, uneducated or completely misinformed.

      After having a very difficult time in determining how to value the varied, complex, and illiquid securities for which there is very little or no information available e.g. 'no market' it was decided to approach resolution in another manner. In final, the $700B went to recapitalizing the banking system with the government receiving equity stakes in those banks - some of which have already been repaid at a significant profit.

      This is not without precedent, as it was the same thing the Swedish did to resolve the 1990's banking crisis in Scandinavia. Which involves a few things:

      1) Injection of equity capital into the banking system
      2) Providing confidence in the banking system to investors by providing transparent marks to illiquid securities
      3) Taking equity stakes in firms that are strong enough to survive and liquidating those that aren’t - this helps to remove moral hazard because there is a serious price to pay if you want to remain in business and you are a financial company
      4) Providing incentives to banks to lend their newfound capital

      Whether or not you agree with this approach is one thing, but how you display your willful ignorance is completely another.

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      • My willful ignorance?
        The toxic assets are still on the books, and the banks aren't lending.

        Hope your KY Jelly jar is full, and bending over is comfortable.

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        • Banks lend out debt. I thought you were against debt, but who knows whats really going on inside your little brain. It should be a good thing that banks actually watch out from taking on too much debt with not enough capital.

          All the $700,000,000,000 has been payed back. The taxpayer PROFITED off of TARP.

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          • Still having trouble with that critical thinking, I see.

            The bank lending was a promise of those that sold the bail out. It's not happening. I don't have a problem with debt, but I do have a problem with excessive debt. I also have a problem with going further into debt when the debt is already excessive. It won't work in my house, in my community, or in my business.

            All that has happened is that those that can actually pay back a loan can't get one. The paperwork for a mortgage loan has gone from a 1 inch stack to a 6 inch stack.

            The banksters were bailed out and the customers get the shaft.

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          • So you are okay with debt and our fiat currency? As long as its not "excessive" debt.

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          • Our fiat currency is what greases the skids on the road to excessive debt.

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          • Your are for debt, but at the same time against debt because it leads to excessive debt.. smart guy.

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          • LMAO that you cannot see the holes in your own reply.

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          • "I don’t have a problem with debt, but I do have a problem with excessive debt."

            - Longshotaway from a prosperous life.

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          • When will I receive a check, Sean?

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          • I dunno. I'm not concerened with your social welfare

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          • Only half of the TARP money has been dispensed, but all of it has been paid back and we made a profit?

            Source, please.

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          • Sean: I hate to disappoint you but Bank of America still has 40 billion in Tarp money on their books. Look at their most recent quarterly report if you don't believe me. Bank of America wants to pay it back but........... it's a long story. Anyway, the whole mess should never have happened and if we would have let some of these banks go under we would be better off now! The Fed has played favorites with the banks (The Fed HATES Bank of America). All the more reason to end the Fed.

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          • You're right. Not all the banks have paid back. I just heard that we profited, but we haven't gotten a return on all of the banks money and we really didn't even profit that much.

            We should get all of the money back, and it is supposed to be used to pay off the deficit.

            The only reason why I wouldn't want them to fail is because we would of lost most of our retirement pension funds. I'm sure there could of been a better way to handle it.

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        • "and the banks aren’t lending."

          God you are full of rhetoric. How many ways should I prove that is a complete lie? First off, banks ARE LENDING and they are just doing so more prudently (which they should have done in the first place), in addition people are also WILLFULLY cutting their household debt. The punch bowl has been taken away, and as a result society is largely adjusting, which has manifested in a 8% decrease in overall revolving consumer debt, and I say it is not all banks that are doing the cutting as our personal savings rate as a nation is up to 5% of disposable income. If you have good credit, you can get a loan. To say otherwise is purely BS. As for citations to refute your idiotic lying (I like to use intelligence and sources to prove my point rather than childish comments about KY Jelly) how about cars and homes - two things people purchase on credit:

          August 21st: "For the first time in five years, existing-home sales have increased for four months in a row, according to the National Association of Realtors®." (oh wait, are those all cash purchases or is that banks lending?)

          How about all the cars sold in the cash for clunkers program? Who do you think loaned consumers the money to purchase the glut of 700,000 cars that were sold under the guise of that program? Or did all of those people who had crappy cars to being with get their $3k rebate and buy a $17k car with cash out of pocket? Really louie? Really? Please tell me another story.

          "The toxic assets are still on the books"

          Did you not see my point? The government decided it DID NOT WANT TO BUY THE TOXIC ASSETS because it could not come up with a mechanism to accurately price them. It was deemed the Swedish model of recapitalizing the system which was deemed as success, was a better route than trying something like distorting a completely opaque market for those securities.

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          • It is so sweet when you jump into the trap with both feet.
            I get a Three Stooges memory when you post.

            1. What does God have to do with this?
            2. You never prove anything, you just gossip.
            3. We went from 5 of 6 loans being approved to less than 1 of 2. You can call that what you like.
            4. Your increase in purchases argument is so weak it couldn't stand if it had four legs. An increase from a previously pitiful figure? Puhleeeze! And your failure of a cash for clunkers program is something that you want to wave your flag from?
            5. The toxic assets are still on the books, meaning nothing that caused the problem has changed.

            Thank you for coming back to be the laughing stock of our humble site.

            Say Cheeeeeese !!

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          • 1. What does God have to do with this?
            A figure of speech. I apologize but I did not mean it to be pertinent to this discussion.
            2. You never prove anything, you just gossip.
            Oh, and you cited your source for the statement “and the banks aren’t lending.” when decrying "sheople to take up arms"? Looks like Emperor Longshot isn't wearing any clothes. Hey, but since you like having your intellectual hand held, to support my statement that "banks are continuing to lend just at a prudent rate" how about a report from the treasury on that states:
            "The June survey found that outstanding loan balances fell 1 percent in June and new loan originations in all 22 banks surveyed rose by 13 percent.

            The lending survey results show that total originations of loans by all respondents rose in five categories (mortgages, HELOC, C&I renewals and new commitments, and CRE renewals) and fell in three loan categories (credit cards, other consumer lending products, and CRE new commitments). Total originations of all loans (by all 22 respondents) increased by 13 percent. The increase in originations was driven largely by increases in new home purchases and seasonal renewals in C&I and CRE lending."

            http://www.financialstability.gov/docs/surveys/SnapshotAnalysisJune2009.pdf

            Now remember, I am saying that banks are being more prudent in lending, I am NOT advocating lending as much as we had been. We obviously overborrowed and are due for a correction. As well, I know this is June, I am sure there are newer, but you will still see that banks ARE LENDING.

            Or how about the underlying details about loan amounts:
            http://www.financialstability.gov/docs/surveys/June2009Submissions.pdf
            "3. We went from 5 of 6 loans being approved to less than 1 of 2. You can call that what you like."
            Thanks for refuting your own argument, you are still receiving loans. Is this lender even a recipient of TARP money? If it isn't what does that say about the 'new normal'? Why do you deserve 5 or 6 loans? Maybe those 3 or 4 loans at the margin are the very loans that comprise these toxic assets on banks' balance sheets that caused all of these problems in the first place? If those '5 or 6 loans' are of creditworthy nature you will find someone to extend credit. Lending has slowed, it has NOT stopped.

            "4. Your increase in purchases argument is so weak it couldn’t stand if it had four legs. An increase from a previously pitiful figure? Puhleeeze! And your failure of a cash for clunkers program is something that you want to wave your flag from?"
            My point is that banks ARE lending, which is refuting your statement of “and the banks aren’t lending”, maybe your memory isn't all that fantastic. Besides, if the 'excessive debt' creation you fret over is what caused this crash - why is a lower number for consumption 'pitiful' to you and not 'appropriate'? I am arguing banks ARE lending, and ARE doing so more appropriately. People do NOT have a right to credit and banks are doing what they SHOULD have been doing in the first place - lending cautiously. Do you want to force people to borrow or force banks to lend to uncrediworthy borrowers or do you want the market to figure out an equilibrium? Your argument is losing me as you dig yourself deeper.

            "5. The toxic assets are still on the books, meaning nothing that caused the problem has changed."
            Why are you still focusing on the problem when I am describing the solution and it's impact? You act like you WANT the government to buy up all the toxic assets at prices that would have been near impossible to gauge and in a time of crisis, brilliant louie, brilliant. The solution has changed to better address the problem. The banking system was recapitalized and the combination of restored trust, increased visibility and accountability, continued and orderly failure of banking institutions, have gone from crisis mode to an environment where businesses, consumers, and financial institutions can work their way out of.

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          • Are there more than one 'Longshotlouie'?

            Louie # 1:
            "and the banks aren’t lending."

            Louie # 2:
            "We went from 5 of 6 loans being approved to less than 1 of 2."

            How could they be the same 'louie'? One louie is seeing banks lend, and another is not? Interesting...

            Either way, TAKE UP ARMS SHEOPLES! Don't let the facts get in the way!

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          • Like I said, you call it what you want. And, again, up 13% from what?
            You're a statist whore and you can't help yourself, so I sure as hell won't try.
            Tell us how the worst is over, so we can laugh at you again down the road.

            Are you getting overtime this weekend?

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          • Wow, I like how you make reference to 'whores' and 'KY' in what should be a grownup discussion.

            I guess I could find one thing you said that applies to your stance: "You never prove anything, you just gossip."

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          • Whew, Sean! Here I was thinking that you were saying that YOU were the "Princeton Professor". My impression of Princeton would have undergone quite a shift had you not cleared that up for me.

            I should ask to which "prestige university" you went, though your inability to write betrays a want for actual education.

            Please let me know which of my statements was "stupid," and how so.

            In the meantime, please explain how there will be "less debt" because the Fed has endeavored to inflate the U.S. currency.

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          • I'm finishing up my undergraduate at A&M.. Its not prestige but it's one of the best schools in Texas.

            Okay, i'll tell you exactly why principle is better than debt..

            Whenever you put debt into an economy, the debt must be paid back, so therefore there is a contraction in the money supply which causes recessions and depressions. Money is allocated to certain parts of the economy and taken away from other parts. This is why debt must be perpetuated, there has to be people borrowing money in order for there to be money in the economy.

            When you create money as principle, it is free to recycle in the economy. You don't need to continue to print money over and over again in the same fashion as debt. It limits the amount of money creation in the economy.

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          • First, "stay in school"--and I mean that sincerely, without sarcasm. Would that I could afford to go back soon.

            But why the acceptance of inflation as a viable monetary strategy? For every dollar printed, the value of the dollars already held is decreased. How is that fair to anyone? Tell me. I plead ignorance.

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          • You don't have to keep printing money if is not created as debt. Money as principal is free to recycle the economy. It's that simple, i'm sorry if i can't explain it any better for you.

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          • Matt: The banks pay for FDIC insurance, not the taxpayers. It would certainly be prudent to raise the FDIC insurance rate for the banks as they have not been very prudent themselves. However, the banks that survive will pay the higher rate to stay in business and they will also get the deposits of the failed banks customers. Maybe we should increase the reserve requirement to maybe 25% so that the chances of banks failing will be less. Of course the ultimate cure is to get rid of this whole mess of fractional reserve banking and the Fed. Then the Treasury Department will take over what they were constitutionally delegated to take care of.

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      • Matt: Why couldn't we just let those banks that were failing fail? Then the stronger banks would receive their deposits and thus have plenty of new found capital. Why are the Fed and the Treasury refusing to let Bank of America repay their Tarp money while they let other banks repay? Can you explain the Merrill Lynch dealings where under oath it was said by Mr. Paulson that if Mr. Lewis didn't buy Merrill he would be out of a job? Can you explain the Feds open market operations which include lending the equivalent of over 3 thousand dollars per person to New Zealand? The Fed is out of control and control of the Treasury must be restored to the people ASAP.

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        • Because we do not know how many of 'those banks' there are, nor can we predict the potentially dire consequences of what 'just letting them fail is'.

          http://www.bloomberg.com/apps/news?pid=20601170&sid=aX8D5utKFuGA

          Nor, as you infer, is it NEARLY as simplistic as just assuming these 'stronger banks' will even want to just assume the deposits of the failing banks in times of crisis. It's not a country family waking up on a sunny morning and having a yard sale so don't portray it as such. It would be like having a yard sale when your whole neighborhood is burning down - markets in times of crisis.

          If I am a stronger bank in a time of crisis why would I want your deposits? Where am I going to get funding to purchase your bank when no funding is available? Do I even know what your liabilities are? Do you even know exactly what they are? Can I anticipate the counterparty risk on your books when I don't even know what is going on at other firms? Where am I going to get the capital to make up for the capital shortfall that caused the other bank to fail? Is the government going to assume the liabilities? Or will it go through bankruptcy court along with all of the other banks that would go under? What will you do with your liabilities, and if your liabilities are junked, what does that do to the counterparty, who could be you, your money market fund, your mutual fund?

          Maybe you aren't understanding the issue, but in times of crisis everything stops, there is no trust or confidence, and markets cease to function. How do you sell something when noone wants to buy it, because they don't know what is going to happen?

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          • So a surviving bank would not want to take in the deposits of a failing bank? Why are they in business?

            Say Cheeeeese !!

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          • "So a surviving bank would not want to take in the deposits of a failing bank? Why are they in business?"

            Of course they want deposits, but how are you proposing a bank could just buy all the deposits and not assume the liabilities at a time of crisis where noone can borrow, people are questioning everything, banks won't even lend to each other, and there is no market for the failed bank that theoretically has your money but can't pay you because it is insolvent? What will you do then?

            Right, government intervention. Take some time to learn about balance sheets, the FDIC, and free markets work. It will help you make fewer overly-simplistic comments in the future.

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          • These banks have gotten so big from purchasing failed banks, thats why they have a monopoly on our economy and our country.
            They are centralizing the debt until we are basically owned by them. Thats why the government was so scared and acted out of fear instead of wisdom.

            These banks OWN the Local Federal Reserve Branches, literally.

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          • Bank of America is the largest bank we have and it has acquired more banks than any other over the past 150 years. It started out as The Commercial National Bank in 1874, than it merged and became the well known Nations Bank. From there it purchased over 200 banks. Then it started purchasing larger financial institutions until they acquired over 284 billion dollars in assets. It took over BankAmerica and then changed their name to "Bank of America". Since then they have taken over at least 4 or 5 large institutions, including Merrill-Lynch. They refused to give shareholders information and was charged for civil fraud from the SEC, but that was dropped in court.

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          • Matt: You are not too bright! The surviving banks get the deposits of the failed banks customers for free! The customers remove their deposits from the failed bank (or their FDIC payment) and put it in the strong bank. There is no buying or selling involved. Also, as a bonus, the strong bank gets stronger because it raises its deposit base. Hence they can afford to loan more money! Funny how well the free market works isn't it!

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          • You are right that banks don't have to purchase deposits, but they do have to purchase assets. They have to buy up all the bad debt with their own depositors money. This could be for pennies on the dollar though. Its a good deal, lets put it that way. Bank of America payed 50 billion for Merrill Lynch just recently.

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          • Banks don't loan out peoples money anyways, this is a false impression. Banks lend out money that they don't have on a promise that someone will pay it back. This is the premise of our debt ran country.

            Whenever you take a loan, the bank puts a negative balance in your account. No money was needed to do this, just a few key strokes.

            Most of these investment firms that failed weren't even depository banks.

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          • Sean: Bank of America owes 45 billion in TARP money. Lewis was FORCED to pay 50 billion for Merrill Lynch by Paulson even though he didn't want to. Paulson basically told him "buy it or else!" Bank of America would never have needed TARP money had they not been forced to buy Merrill Lynch!!!!!

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          • haha, i'm sorry but thats kinda wrong. Bank of America was trying to invoke the MAC. They were trying to pull out of a deal they already made to negotiate lower terms because the bank's assets lost more value during the process.

            The reason why the government is holding bank of america ransom is because they are the biggest threat to our banking system by performing the most unlawful immoral practices.

            You should read a lil bit about bank acquisitions. There are thousands of them online if you want to find out more. Banks purchase other banks assets, that's the way it has always been.

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          • sean says:
            September 23, 2009 at 5:37 pm
            Banks don’t loan out peoples money anyways, this is a false impression. Banks lend out money that they don’t have on a promise that someone will pay it back. This is the premise of our debt ran country.
            -------

            Please clarify. Are you supporting this system of an entity loaning money that it does not have?

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          • Of course I don't support it. I'm pretty sure I told you that in this thread twice already, stop being a pee body.

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          • I have to ask: was anyone here insinuating that he/she is a "Princeton Professor" [sic]?

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          • Ya I was. From the stupid statement you made earlier, I know that he has better understanding of economics than you. What prestige university did you go to? I guess you don't understand their level of education bc you think the internet is all the education you need. Grow up.

            I also said he doesn't have common sense when it comes to economic predictions. Do you wanna criticize that too?

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          • This is actually what I said about our banking system a couple posts up..

            [Bank of America] they are the biggest threat to our banking system by performing the most unlawful immoral practices.

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          • Sean, could you please list what you are for and against in the way of economics. Your responses are contradictory.
            You seem to defend the same things that you say you are not for.

            Of course, it could be that the rest of us are ignorant and are just unable to comprehend your genius.

            Maybe.

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          • Lindsey says: "Matt: You are not too bright! The surviving banks get the deposits of the failed banks customers for free! The customers remove their deposits from the failed bank."

            OK Lindsey, in your pure 'free market' situation... How do you just "remove your deposits from a failed bank" if they don't have your money? What if it just closes up one day? What will you do then?

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          • And, to clarify Lindsey, we are only referring to 'failed' banks. I am not referring to mergers or open-market acquisitions. Your reference assumes people CAN remove their money from a failed bank - which is impossible as the very definition of a failed bank is where the assets DO NOT cover the liabilities (deposits). That isn't exactly 'freedom' if you don't get your money, right?

            And if you want to understand how failed (or failing) bank mergers do occur right now, which will help you understand why your argument is so insane, check out this:

            http://www.fdic.gov/news/news/press/2009/pr09170.html

            Here are some key statements:

            - "To protect the depositors, the FDIC entered into a purchase and assumption agreement with First-Citizens Bank & Trust Company"
            - " In addition to assuming all of the deposits of the failed bank, First-Citizens Bank & Trust Company agreed to purchase approximately $874 million of the assets. The FDIC will retain the remaining assets for later disposition."
            - "The FDIC and First-Citizens Bank & Trust Company entered into a loss-share transaction on approximately $715 million of Venture Bank's assets." "The loss-sharing arrangement is projected to maximize returns on the assets covered by keeping them in the private sector. The agreement also is expected to minimize disruptions for loan customers."

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          • Matt: No bank has enough assets to cover liabilities when it comes to short term deposits We use a fractional reserve system of banking in this country. The present percentage is I believe 15%. That means that a bank has to keep 15 cents out of every dollar deposited in reserve. the rest..... When a bank fails in this country the FDIC steps in and covers the deposits of the banks customers up to I believe now 250 thousand. The process takes about one day. You do understand that don't you?

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          • Sean: Lewis never actually signed the deal and when he learned more about Merrill and decided that he didn't want to go through with it he was threatened by Paulson. Then Lewis had a choice; He either betray his stockholders by making a decision he knew was bad for his bank or face the wrath of the administration threatening him with his job etc. I agree that Lewis probably should have told Paulson to kiss off but that is a hard thing to do. So he bought Merrill. As it is now Lewis was not removed from his job by the stockholders of Bank of America although they took away his CEO position and he retained his president position. I guess they trust Lewis a lot more than they trust the government don't they!

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          • No, I was correct. They were in the process of the acquisition when he tried to INVOKE THE MAC.

            "Lewis testified under oath, as he has in the past, that mounting losses on the books of Merrill Lynch, which came to light in mid-January, made him seriously consider invoking a material adverse change clause to pull out of his bank's acquisition of Merrill. The losses, as the story went, were Merrill's fault."

            Ken Lewis hid information from his shareholders and had lawsuits filed against him.

            "He also said his management had gotten weekly reports about Merrill's books since the deal was put together in September, and that Bank of America was aware of losses mounting as early as November. The loss projections evident in mid-December, which provoked his reticence, were based in part on November losses.

            That makes it look like Lewis used a MAC clause as a bargaining chip to get more federal assistance, Kucinich said. "There has been a misconception here that the government put a gun to Bank of America to do the deal, when in fact it was Bank of America that put the gun to the government," he said to Lewis. "You are trying to change the scenario" to being a victim."

            -Forbes magazine

            http://www.forbes.com/2009/06/11/bofa-merrill-lynch-business-washington-fed.html

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          • Sean: That is Kucinich's opinion and he is entitled to it. The trial will start soon and I'll bet that Bank of America wins! I say Lewis was railroaded!

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          • I think bank of america is corrupt. I heard they bought merrill lynch with credit instead of actual dollars!(PBS) These large banks are the source to all of our debt troubles and you see people trying to get them under control as evil? What backwards thinking you have.

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          • Lindsey, thank you for making my point: "When a bank fails in this country the FDIC steps in and covers the deposits of the banks customers up to I believe now 250 thousand. The process takes about one day. You do understand that don’t you?"

            Yes, but... Ummmmmmm.... How could you consider that to be 'free market activity'? Isn't the FDIC a government entity funded by our tax dollars and is designed to insure banks are solvent? Are you really saying the FDIC just flies in like superman, covers all of the deposits, and then the deposits are reallocated via the efficiency of the free market system to a stronger bank, for free?

            How naive.

            Remember, you originally posited:

            "Why couldn’t we just let those banks that were failing fail? Then the stronger banks would receive their deposits and thus have plenty of new found capital."

            Looks like you are now saying 'well since MY deposit is insured by the government it is ok to let the government take the losses and the deposits to reallocate for 'free'. And by 'free' i mean at a cost to the taxpayer.'

            Sounds a little hypocritical.

            Let's look at the last failed bank to see how deposits are simply reallocated 'for free' in your little utopia:

            http://www.fdic.gov/news/news/press/2009/pr09170.html

            "As of July 28, 2009, Venture Bank had total assets of $970 million and total deposits of approximately $903 million. In addition to assuming all of the deposits of the failed bank, First-Citizens Bank & Trust Company agreed to purchase approximately $874 million of the assets. The FDIC will retain the remaining assets for later disposition.

            The FDIC and First-Citizens Bank & Trust Company entered into a loss-share transaction on approximately $715 million of Venture Bank's assets. "

            Interesting, words like 'FDIC retaining assets', 'loss share transaction'... Well, lets re-visit this 'deposits just move for free' theory:

            "The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $298 million. First-Citizens Bank & Trust Company's acquisition of all the deposits was the "least costly" resolution for the FDIC's DIF compared to alternatives."

            So Lindsey, you can't have it both ways. You can't have the taxpayers paying to insure your money is safe while asserting that when a bank fails it's as simple as another bank swooping in and getting the deposits 'for free'.

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          • You are correct Matt. Depositors used to be only be insured up to 100k, but since the crisis they changed it to 250k..

            If a bank were to go under and someone had more money than that, they would lose it. This has always been true. It is the main reason for a "run on the bank." The reason why bank runs happen is because people pull their money out when they are afraid it is not solvent. This is why most banks don't want the audit of the federal reserve. They don't want their investors/depositors to know how insolvent they truly are. Most of them don't have any money because they rely on debt. There could be massive bank runs when this bill passes. At least that is what i've heard from top investors.

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          • "The Deposit Insurance Fund (DIF) balance decreased by 20 percent ($2.6 billion) to $10.4 billion during the second quarter of 2009."

            http://www.fdic.gov/about/strategic/corporate/cfo_report_2ndqtr_09/0609_CFO_Report.pdf

            Soooo, 10 billion versus roughly $4-$5 trillion in deposits (with a national savings rate that is going up) that it guarantees? And, backed by the full faith of the government?

            Imagine if the treasury/fed would not have stepped in last year and provided capital, those banks would have failed in a disorderly fashion, the FDIC would have been tapped out, and more runs on banks would have occurred like the one at WaMu.

            Who knows if you would have gotten your money back as a retail customer then?

            And I say again, what bank would have been scurrying around and snapping up failed banks in that environment?

            Check out the Libor/OIS spread and tell me banks would have been able to get funding to purchase other banks in a time of crisis:

            http://research.stlouisfed.org/publications/es/09/ES0924.pdf

            They couldn't even trust to LOAN each other money, nonetheless go around buying stuff up...

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          • Matt: One bank's loss is another banks gain. My kid had an account at WaMu and he now has an account at Bank of America. Bank of America got a new customer because of the WaMu episode. (Actually I'm sure they got a lot of them!) Yes, the FDIC was out a lot of money in the deal but as I said before, if we get rid of fractional reserve banking we can solve this problem. Get rid of the Fed. too!

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          • Zeitgeist: Addendum 1/13
            http://www.youtube.com/watch?v=NT-2fenmLnc&feature=related

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          • Ya i own both zeitgeist movies. I saw the first one like 3 or 4 years ago. I saw it also at a special showing at the theaters.

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          • You should watch the first zeitgeist Christine..

            http://video.google.com/videoplay?docid=-594683847743189197#

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          • I've watched all of them. He created the addendum when he became aware of more updated info.

            If a person steps back and takes a look at this whole system of things including the money, politics, anything that divides us, and looks at it as if not a part of it but an onlooker...it all is quite insane what we tollerate and allow, what has been created.

            Then think of yourself listening to someone who is going to begin to create this mess, er idea, someone who is trying to evoke enthusiasm and cooperation from the masses to join in and believe ...knowing we could create a way of life any way we choose... I think the person would be booed and hissed off the stage and be forever subject to public ridicule.

            Was this beautiful tiny planet meant to be run by the concepts born from minds that are not well and the insane?

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          • I don't believe in corporatism at all. If the government allowed more unions, than there wouldn't be such a large income inequality.

            http://www.youtube.com/watch?v=5kwA-CwFK5A

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        • Bank of America didn't take over Wamu, JPMorgan Chase did... As in the JPMorgan. He's was one of the wealthiest man ever.. One of the most crooked guys ever. Him and Rockefeller.

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          • JPMorgan and CFR and NWO..

            http://www.youtube.com/watch?v=3sGs8eFld1U

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          • Sean: I said my kid took his account from WaMu to Bank of America as did many people. JPMorgan Chase may have bought the assets but depositors are always free to put their deposits wherever they want.

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  20. I pre-ordered this book, got it a few weeks ago. It is an amazing read.
    They should make it required reading in the schools!!!

    Let's make it #1!!!!

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    • Casey: I will make sure to go to the local bookstore to get a copy and the en pass it around to as many people as I know. Everyone on this site should commit to that!!!!!!!!!!!

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