56 responses to “The Bizarre Art of Central Banking”

  1. Meredith

    Bernanke got schooled! Go Ron! I hope he does run in 2012. I’m sick of the government screwing everyone over. Ron Paul is one of the very, very few politicians that I actually trust to do the right thing.

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  2. Ross Johnson

    The dilution of wealth via the fractional reserve banking system is the greatest travesty ever perpetrated on our humanity.It is theft by stealth.When the non productive systems in our economies take more than they give,we have decadence that suck the essence of creativity that once made the USA and the West a philosophy to be revered.

    Now we have bankster avarice that seeks total power,thus destroying the inspiration and creativity that made it all possible.

    The greedy Wall St war mongerers must now face their accusers .

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  3. Fred the Protectionist

    Dismantling America

    By Patrick J. Buchanan

    http://buchanan.org/blog/dismantling-america-3714/comment-page-1#comments

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  4. Siegfried

    SS… I believe you’re on to “Fred the Prophylactic”.
    He’s a “seminar blogger”, a self appointed tool of the Progressive radical left. He never has a valid argument, or facts to back it up, just a continuous stream of incoherent rants to muddle the topic.

    He engages in a misdirection game of S.I.N.,

    Switch the subject at every opportunity, subterfuge is the best means of confusing the topic.

    Ignore the facts they just get in the way of the subterfuge.

    Name call… when Switching and Ignoring don’t work, apply a demeaning label to end the discussion.

    Watch him, he’s very predictable.

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    1. Fred the Protectionist

      ‘He’s a “seminar blogger”’

      A seminar blogger? OMG. Actually I’m just a normal guy (normal as opposed to abnormal like libertarians), who has too much time on his hands. I don’t get out much.

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    2. longshotlouie

      And he still is unable to distinguish between gov trade and free trade.

      Maybe English is not his language.

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      1. Fred the Protectionist

        NAFTA lowers trade barriers, are you denying this aspect? Isn’t that your goal? Zero trade barriers. If that is your goal then why do you disown one step towards your goal, unless you’re a nut.

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        1. longshotlouie

          You continue to deflect. Let’s try again.

          Is NAFTA the same as the free trade that we describe here?
          It’s one question. You can answer yes or no.

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          1. Fred the Protectionist

            NAFTA is a free trade treaty, why do you deny reality.

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          2. longshotlouie

            I’ll take that as a yes.

            What you still cannot see is that it cannot be free trade if governments need to sign treaties that manipulate the market. Just because they want to call it free trade does not change the fact that it is quite the opposite.

            You and I both know that we are not speaking of the same things, but you continue to hang your hat on moot points. It is nothing more than obfuscation to avoid facing the reality that you rail against something that we are also against.

            What you are for is the flipside of what you are against. Your jacked up tariffs and isolationism will eventually do to the people what this so-called ‘Free Trade’ has done.
            The answer is and always has been, actual free, unadulterated by government fiats, trade.

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  5. mark pace

    TAXES–Everbody should pay the same % rate as everbody else. Can be done when you make a deposit at bank, send? say 10@ on the dollar and that’s it. Then gov. has to pay as you go. want to change % rate, Then take a real Vote.

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    1. Fred the Protectionist

      That’s not in the Constitution. But Tariffs are.

      Don’t Libertarians like the Constitution?

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      1. David

        Wrong Again…

        Section 8, Clause 1: The Congress shall have power To lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defence and general welfare of the United States; but all duties, imposts and excises shall be uniform throughout the United States;

        … and later The 16th Amendment

        “The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.”

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        1. Fred the Protectionist

          Taxing through banks is not in the Constitution, fruitloop.

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          1. David

            What part of “The Congress shall have power to lay and collect taxes on incomes, from whatever source derived,” did you miss? Seems pretty obvious that if they wanted to take the money when you deposit it, that is well within “whatever source derived”.

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          2. Fred the Protectionist

            Why do Ronulans always look for Unconstitutional solutions to simple problems.

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          3. longshotlouie

            Why do you continue to obfuscate the issues?

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  6. Svend

    Alright. Here’s your wedge Dr. Paul.

    http://www.zerohedge.com/article/new-merrill-lynch-disclosure-shines-new-and-perjurious-light-ben-bernankes-sworn-testimony

    You’ve got him. This is the issue. Dig in.

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    1. SS

      Dr. Paul is aware of this. That’s why he asks the questions, to get a response on record.
      Laying the trap.

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  7. Fred the Protectionist

    “Have interest rates been too low too long?” says Ron Paul implying that low interest rates are bad, or better yet says Ron, “Hey y’all lets get rid of the Federal Reserve.”

    The FED forces banks to have at least 10% reserves, and if a bank goes under that amount, than the rate the FED also sets is what banks use to borrow to get back to that reserve.

    NO FED = No reserve requirement. So Ron Paul’s solution would be effectively a zero interest rate, because during the times before the Big Bad FED, banks recklessly loaned out till they had NO reserves left; and people got screwed, and that’s bad.

    Is Ron Paul and his Ronulan acolytes suggesting we get rid of the FED? They constantly do. So why complain about low interest rates when your solution would be worse than low interest rates. That’s like complaining about NAFTA when your solution would be worse than NAFTA. HAHA, that’s insane.

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    1. David

      Most would also contend that the fractional reserve banking system needs to be changed as well. The main point however is without the fed, banks have to lend their own money and there is no lender of last resort.

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      1. Fred the Protectionist

        Without the FED, there wouldn’t need to be a lender of last resort since banks could recklessly loan out everything they have and not be forced to have any reserves.

        Personally I think 10% reserve requirement is worse than the low interest rates, but you Ronulans would prefer to whine about the low interest rates the banks use to maintain that reserve.

        10%, I mean c’mon, should be more like 50%.

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        1. gander

          when banks were first invented guess what the reserve limit was? there was none. if a bank had no reserves and a patron asked for 1 dollar then the bank would collapse. it is in the banks interests to keep healthy reserves except when they have a guarantee from the gov saying that uncle sam will take care of any problems. only then do they feel free to loan out as much as possible. this is called moral hazard. read an economics book.

          fred is so trained to trust the government that he thinks without their nanny hand guiding us we would collapse. reserve limits don’t work.

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          1. Fred the Protectionist

            When banks were first, ahem…..”invented”, people who deposited their money got regularly screwed.

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  8. Siegfried

    Well said Libertarian777.

    It’s a sad fact that too few citizens understand what the Federal Reserve really is.

    Back 97 years ago Americans were simple and ignorant of any banking principals so it was very easy to pull the wool over. But these days the ignorance displayed by “Fred the Prophylactic” and his ilk is simply inexcusable.

    It’s downright depressing knowing how many “Freds” are blithering like zombies out there, scary isn’t it!

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  9. Siegfried

    Fred is the proverbial whine and we should collectively refrain from casting our pearls!

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  10. Fred the Protectionist

    The largest bill in decades is goes through Congress right now, Health Care, and Ron Paul is focused on the Federal Reserve? Holey moley.

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    1. David

      You do realize that he is on that committee, don’t you? He doesn’t control the agenda for the committe, but he takes it seriously, which is more than can be said for the other members.

      The Fed will be the one monetizing the debt needed to pay for that large bill, so, yes, it is very important to understand what the Fed’s plans are and to attempt to control even a small part of what the Fed does (though that is unlikely).

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      1. Fred the Protectionist

        noooo, it will be Congress to monetize the debt if the debt gets monetized.

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        1. David

          At least they will be held accountable for their responsibilities. The way it is now, if things go bad, they can blame the Fed. It’s crazy that the congressmen can act enraged at the Fed for using the powers that congress continues to grant them, without acknowledging that it is their responsibility constitutionally.

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          1. Fred the Protectionist

            The only one blaming the FED is Ron Paul.

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      2. Fred the Protectionist

        “You do realize that he is on that committee, don’t you? ”

        Oh you mean that committee that has ‘oversight’ on the FED?

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  11. Ryan

    Why does everyone even give “Fraud the Pretenderist” the dignity of a response?Clearly, obviously, he is a propogandizing puppet and dedicated spamster. I don’t believe for a second that he even believes himself half the time.
    He is here every day. Why would someone that disagrees with a single politician on “every issue” spend his days at a website supporting said politician?
    He’s a troll! He’s not interested in discussion. He probably works for some neo-con candidate…. One that is very, very affraid of losing to a rational and principaled Conservative politician like Ron Paul.

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    1. longshotlouie

      The same reason a cat plays with a mouse, amusement.

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      1. Ryan

        lol Okay, I’ll accept that answer.
        … Chew him up! :P

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    2. Fred the Protectionist

      Libertarians are liberals, not conservative.

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      1. David

        More non-sense. I am neither liberal nor conservative as a whole. I am fiscallly conservative and socially more liberal.

        Do you still work for Lindsey Graham?

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        1. Fred the Protectionist

          Market “Liberalization”, open borders (bring in more “liberals”), pro-Abortion (liberal), put women in combat roles (liberal), legalize drugs (liberal), pro-Gambling (liberal), ignore Constitution or make stuff up like ‘separation of Church and State’ (liberal), instead of trying to cut EPA’s funding or restructure to punish them for trying to make policy you “liberals” would rather abolish them.

          You’re radicals (liberals).

          Liberal doesn’t mean LEFT, it means change, radical.

          Conservative doesn’t mean RIGHT, it means resistant to change.

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          1. David

            I agree that most of what you said are things I agree with. Whether they are “liberal” or “conservative” is inconsequential…. assuming you mean that those decisions are left up to each state to decide and not mandated on a Federal level.

            As for this:
            “ignore Constitution or make stuff up like ’separation of Church and State’ (liberal), instead of trying to cut EPA’s funding or restructure to punish them for trying to make policy you “liberals” would rather abolish them.

            You’re radicals (liberals).

            Liberal doesn’t mean LEFT, it means change, radical.

            Conservative doesn’t mean RIGHT, it means resistant to change.”

            … more nonsensical gibberish. I won’t waste my time.

            Also, for the record, I am proud to be radical.

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          2. Fred the Protectionist

            Fine, just stop abusing words.

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          3. Fred the Protectionist

            “But if thought corrupts language, language can also corrupt thought.” George Orwell

            http://www.mtholyoke.edu/acad/intrel/orwell46.htm

            George Orwell, “Politics and the English Language,” 1946

            Libertarians are corrupt to the bone.

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  12. Fred the Protectionist

    “There’s a spread over the treasury. If treasuries rates go up (e.g. from 0.25% to 5%) the other bonds would increase their yield by a similar proportion (treasuries + yield spread).”

    That’s right, no FED, zero baseline interest rate. So why complain about low interest rates when you’re solution is no interest rates?

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    1. longshotlouie

      lmao, where do you come up with this stuff, Fled?

      Is an interest rate the intellectual property of the Federal Reserve?

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  13. Siegfried

    Fred “the Protectionist”
    SAY WHAT? you cannot be serious!

    Without the FED interest rates would be around a natural rate of 5%-7% not the ridiculous 1% they are now. Fact is that the Banksters have lots of Fiat Federal Reserve Notes (cash) but also Boat Loads of mal-investment liabilities on the books in the form of hyper-inflated real estate.

    Mr. Paul’s point was… our politicians forced the banks, under threat of law suits, to make $5 Trillion in un-secured real estate loans, Fannie and Freddy guaranteed and packaged them like bales of cotton and sold them to China and Europe, and the FED (Magic Money Machine), pumped out the bogus inflated Reserve Notes at a record pace.

    How about “Protection” from the FED artificial manipulations and enforcing our Constitution to rein in the spend-thrift Politicians?

    First, enforce Article 8, and mint bullion silver Treasury coin and stop delegating that LEGAL responsibility to a Fraudulent Central Bank.

    Second, End fractional Reserve Banking on Demand Deposits!

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    1. Fred the Protectionist

      No, without the FED it would be zero.

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      1. longshotlouie

        Wake Up, Fled

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        1. SS

          Would you elaborate, Freddie?

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          1. Fred the Protectionist

            I already did, that interest rate is only used to get that that 10% reserve requirement.

            No FED=No Reserve requirement

            No Reserve Requirement = No interest rate.

            Why complain about low interest rates when your solution is ZERO interest rates?

            That’s like complaining about NAFTA/CAFTA/WTO when your solution is worse than NAFTA/CAFTA/WTO. That’s just crazy talk.

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  14. longshotlouie

    So mere humans could not agree to a rate of interest?

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  15. Fred the Protectionist

    “Have interest rates been too low too long?”

    Does Ron Paul realize that if there were no Federal Reserve than there would be no interest rate, it would be ZERO. So why would you complain about low interest rates, then turn around and say your solution is ZERO interest rates?

    Does not compute.

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    1. longshotlouie

      Price fixing is an art, says the Bernankster.

      This cannot be left to mere mortals

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    2. Ragnar

      There would be no interest rate without the Federal Reserve??

      This is the most ridiculous statement I have read at this site.

      Please educate yourself.

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    3. Libertarian777

      Fred the Protectionist : “Does Ron Paul realize that if there were no Federal Reserve than there would be no interest rate, it would be ZERO”

      Wow, where did you study finance and economics?

      LIBOR, junk bond rates, corporate bond yields etc. are not set by the Fed.

      There’s a spread over the treasury. If treasuries rates go up (e.g. from 0.25% to 5%) the other bonds would increase their yield by a similar proportion (treasuries + yield spread).

      If the Fed wasn’t purchasing Treasuries, Treasuries would have to compete with the higher yielding corporate, sovereign and other bonds.

      There are numerous studies including those by the CBO that shows at the current rate of growth the eventual amount of treasuries that have to be issued just to pay for the interest on the national debt will crowd out all other bonds (interest on teh current national debt runs over $300billion a year).

      Having interest rates this low does numerous things, 2 of which are really bad.
      1. it discourages saving (who want’s to invest in a CD earning 0.25%?)
      2. it encourages borrowing. Particularly by the government. Since the interest rate on treasuries are only 0.25% the government is getting money for nothing.
      The problem occurs when they try and roll over the obligations in the future.
      Eventually the national debt is so large, when the government wants to roll over its obligations it will be at a much higher rate, resulting in exponential growth in the national debt.

      It’s similar to what Lehman Brothers and Bear Sterns were doing, using short term funding for long term obligations (repos to fund MBS, CDOs etc).

      Repos allows you to leverage up a lot, very quickly. Where is Lehman Bros and Bear Sterns nowadays? Their repo funding dried up rapidly after the ‘full faith and credit’ of their name was trashed.

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      1. Fred the Protectionist

        No, without the FED it would be zero..

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    4. SS

      Can Fred really be this dumb. It must be a ploy.

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      1. Fred the Protectionist

        In the purest form of the word, Ronulans are pure ‘reactionary’.

        Say something that doesn’t fit into Ronulan ideology, it’s like using that little doctor’s hammer on a kneecap, an involuntary reaction takes place, they kick. No thinking takes place whatsoever.

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