What About the 2/3 of Government Revenue that Comes from Returns on Its Investments?

With all this fear-mongering about the U.S. going into default, I think it's important to understand that the government is the largest investor in the companies its supposed to be regulating and 2/3 of its revenue comes from investments (every government agency maintains its accounts in what is called the "Comprehensive Annual Financial Report" or CAFR, which is NOT the  taxpayer"budget".  It is the general accounting structure for government, a FULL DISCLOSURE of all assets and liabilities),  NOT taxes. So one might ask the government the following questions: how do you regulate a company when you're sharing in its profits? How do you avoid conflict of interest when that conflict is embedded in the established system?  How do you act without considering the revenue potential of your actions? How do you protect us from corporate evil when you are the largest most powerful corporation in the world?  Government power and wealth is corporate power and wealth. There is no separation between government and corporate agendas. It should be readily apparent through the continuing passage of laws that profit government, as well as not only the lack of enforcement applied when the political/corporate elite break the law, but their rewards as in the recent bailouts.

“They tell us that our taxpayer budgets are continuously short of money from debt, taxes, tariffs, tolls, fines, levies, fees, dues, duties, orders, finance charges, excises, audits, permits, licenses , contracts, legalities, acts, rules, regulations, restrictions, requirements, requisites, prerequisites, post requisites, documentation, obligations, restraints, constraints, options, conditions, causes, tenure, status, etiquette, postage limits, speed limits, size limits, weight limits, closed circuit tv, red-light cameras, citations, tickets, quotas, equal opportunity, signs, signals, boundaries, borders, fences, zones, zoning, associations, directives, mandates, sanctions, liabilities, confiscation, eminent domain, restraint, restraining orders, position, possession, influence, ownership, control, lawsuits, punishment, capital punishment, bail, detention, psychiatric observations, rendition, custody, confinement, captivity, incarceration, arrest, manhunts, warrant, required insurance, prescriptions, registration, referrals, waiting lists, free speech zones, terrorist watch-lists, no-fly lists, and, classified information,. These are all sources of revenue for government. In other words, taxation without representation." -- Clint Richardson

The only thing that's in our favor is the government's need to pose as a public servant who performs legitimate tasks, but that mask seems to be dropping more and more every day while we continue to wring our hands and buy into the outright lies that the mainstream media report, 24/7,  in order to ensure that their masters--the unaccountable federal government--remain immune from their ever-increasing legalized "crimes". This continuous threat of government shut-downs, defaults, and going over "fiscal cliffs" is nothing but pure fiction. The reality is that our government is not interested in providing public service, because there is money to be made at our expense by promoting and creating legislation that practically guarantee corporate agendas. Keep in mind that government, directly or indirectly, own 70% of all equities on the stock markets and 80% of the Fed’s income goes back to the treasury!

How do we know this?  It is thanks to Mr Walter Burien and Mr. Clint Richardson, who have exposed a huge piece of the puzzle: that the government owns it all by investment, that we can liberate ourselves from this false reality.  We all need to learn that the political elites profit  immensely from this ongoing government-by-crisis political theater that  unfolds before our eyes everyday on FOX News, CNN, MSNBC, etc. We need to learn that the outrageous revenues that government collects through taxes, fees, permits, licenses, penalties and various forms of corruption, piracy and theft is permanently lost to public benefit.

However,  to most of us, it's much easier to digest the promoted fictions and fallacies about the Federal Reserve and the "default" that they threaten us with through, as Clint Richardson says, the "daily feeding frenzy of misinformation surrounding this investment and currency scam, where inaccuracy and downright fiction rule over any comprehension of what the Fed really is, what it does, and who its master is," than to wade through the 479 pages of deliberately confusing and boring truth that lay within the audited financial statements of the Federal Reserve and the 185,000 government CAFRs of the United States government.

From Walter Burien:

** Government was NOT supposed to operate at a profit. How did they get around this restriction?

ANSWER: If for example a city had a 100-million dollar profit for the year from any of its operations, at a stroke of a pen they create or deposit into a "liability fund" and poof, there goes the profit re-designated now as a liability.

Here is the link to the Board of Governors Comprehensive Annual Financial Report (CAFR), . for 2011, the latest and 98th audit of the Federal Reserve. According to Clint Richardson, "it explains how everything operates, its foreign investments and foreign currency swaps and schemes, its many separate limited liability corporate holdings like Maiden Lane, its dealings and bailouts with AIG, Bears Stearns, and JP Morgan, and of course its assets and liabilities balance sheet."

“Within this 479 pages of dry and boring financial reporting is a full description of the Fed’s operations, including the basic financial happenings of each individual reserve bank. Yeah, I know, it doesn’t have the flair of a good “Secrets of the Temple” or “Creatures” type of novel, but its got all the actual facts and figures from TARP to SOMA. Why? Because this is what is required by federal law.

If you want to know about the Fed, read the CAFR.

If you want to know about your city, read the CAFR.

If you want to know about your county, state, district, or any other governmental agency or corporation, read the CAFR.

Here are a few highlights:

Board of Governors of the Federal Reserve System
Washington, D.C.
May 2012

To: The Speaker of the House of Representatives:

Pursuant to the requirements of section 10 of the Federal Reserve Act, I am pleased to submit the ninety-eighth annual report of the Board of Governors of the Federal Reserve System. This report covers operations of the Board during calendar year 2011.

Sincerely,

Ben Bernanke
Chairman

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Austerity Measures and Sequestered. Meanwhile Over $28 Trillion in Limbo or Given Away to Foreign Banks and Corporations.

Remember the GAO audit released on July 21, 2011, discovering $16.1 trillion went to foreign banks, and foreign corporations in addition to domestic banks and corporations?  Well, apparently you can add $9 trillion that's supposedly unaccounted for, or lost.  And let's not forget the $2.3 trillion missing from the Pentagon, announced by Donald Rumsfeld on 9/10/2001.

As one seadooyah1 commented:

“How is it the IRS (which is the mafia for the FED) can find a $100 mistake on our tax returns, but cannot find 9 trillion dollars of our money???

And as Hugh Mann said:

“Money? What money. There hasn't been REAL money on this planet in decades. This digital horseshit called currency isn't even backed by shit. It's absolutely worthless. The banks print money from thin air, loan it to you with interest and when you can't repay the loan, they take all you own. What an ingenious idea of getting something tangible for nothing.

The Parasites That Be are spending and losing like drunken sailors because they know it's crap and it's going to collapse. They better get as much as they can before it's too late.

Below, Rep. Alan Grayson questions Inspector General Elizabeth Coleman in 2009 as to where $9 Trillion went. She responds that she has no idea.

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QE3 and the Global Land Grab

You can't create wealth out of thin air; therefore it's plain to see that money is not wealth, it's the mechanism used to transfer wealth from we the taxpayers to the ruling class. For instance, when Ben Bernanke prints new money (QE3), who gets first dibs on that money? His wealthy friends, of course. And then, in turn, they lend it out at quadruple the price and/or purchase up all of the finite resources--especially land, farmland, that is. Why? He who controls the food controls the world.

That's right, the global tycoons, especially since the financial crisis in 2008, have been buying up farmland all over the planet at an alarming rate, while subsistence farmers are losing their land and their way of life. They're being priced out of existence as the New World Agricultural Order unfolds.



Meanwhile, the Fed is quietly acquiring massive amounts of property in the US through their purchase of mortgage-backed securities. There are an estimated 1.5 million homes currently in the foreclosure process. Under the current QE3, Bernanke will own those properties once the foreclosure is complete. The point? To create a huge land-grab within the US where the Fed owns massive amounts of land and can leverage this acquisition against the American public as the transition becomes apparent.

Oh, and the Federal Housing Finance Administration (FHFA) recently announced that “strategic defaulters”, i.e. those homeowners who have abandoned their mortgage because they could not afford to make the monthly payments will be jailed for this “crime”.

So what we have here are banks, agencies and government "manipulating" the market toward their own agenda at the expense of we the people. Nothing new here.

Links:

'Shadow REO': As Many as 90% of Foreclosed Properties Held Off the Market, Estimates Suggest

Supposedly, these homes are being released in bulk to major conglomerates who have billions of dollars to buy them for pennies on the dollar and fix and sell them or lease them out. The banks are selling in bulk to them with the understanding that they are not to be sold within a certain amount of time

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$16 Trillion in Secret Bailouts!

According to Senator Bernie Sanders, the first top-to-bottom audit of the Federal Reserve took place, implying that the Federal Reserve is audited, as the Comprehensive Annual Financial Report (CAFR) shows, however, that audit doesn't go far enough. Anyway, Senator Sanders said this audit uncovered "a whopping $16 trillion in secret loans to bail out American and foreign banks and businesses during the worst economic crisis since the Great Depression."

"As a result of this audit, we now know that the Federal Reserve provided more than $16 trillion in total financial assistance to some of the largest financial institutions and corporations in the United States and throughout the world," said Sanders. "This is a clear case of socialism for the rich and rugged, you're-on-your-own individualism for everyone else."

"No agency of the United States government should be allowed to bailout a foreign bank or corporation without the direct approval of Congress and the president," Sanders said.

From the Silver Bear Cafe:

The list of institutions that received the most money from the Federal Reserve can be found on page 131 of the GAO Audit and are as follows..

Citigroup: $2.5 trillion ($2,500,000,000,000)
Morgan Stanley: $2.04 trillion ($2,040,000,000,000)
Merrill Lynch: $1.949 trillion ($1,949,000,000,000)
Bank of America: $1.344 trillion ($1,344,000,000,000)
Barclays PLC (United Kingdom): $868 billion ($868,000,000,000)
Bear Sterns: $853 billion ($853,000,000,000)
Goldman Sachs: $814 billion ($814,000,000,000)
Royal Bank of Scotland (UK): $541 billion ($541,000,000,000)
JP Morgan Chase: $391 billion ($391,000,000,000)
Deutsche Bank (Germany): $354 billion ($354,000,000,000)
UBS (Switzerland): $287 billion ($287,000,000,000)
Credit Suisse (Switzerland): $262 billion ($262,000,000,000)
Lehman Brothers: $183 billion ($183,000,000,000)
Bank of Scotland (United Kingdom): $181 billion ($181,000,000,000)
BNP Paribas (France): $175 billion ($175,000,000,000)
and many many more including banks in Belgium of all places

The GAO Report

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The Revolving Door of Access, Power and Privilege Continues to Spin.

On behalf of global corporate interest President Obama has nominated a fox to guard the hen house. That's right. While President Obama was vacationing in Hawaii, he nominated Jerome Powell, a former Carlyle Group executive, former hedge fund insider, to serve on the Federal Reserve Board of Governors.

The Carlyle Group is a massive private equity firm.  It is "an immensely powerful company with virtually no scrutiny," and is one of the most powerful, well-connected, and secretive companies in the world.

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Ron Paul's Convoluted "Audit the Fed" Scheme.

It can't be stated enough. Ron "Audit the Already Audited Fed" Paul's donning the mantle of an outsider when, in reality, he's been playing dirty politics inside the beltway for over 30 years.  Once again,  presidential candidate, Clint Richardson, who produced The Corporation Nation  - which exposes the hidden wealth and investment totals of the United States, Inc. - proves it again.  In the video below, he asks why HR 1207, the predecessor to Ron Paul's “HR 459, The Audit the Fed Bill to the 112th Congress“ that "garnered broad bi-partisan support with 320 cosponsors in the 111th Congress - enough votes to pass in Congress - was transformed from a free-standing bill into an amendment,  which was attached (but removed in conference) to the Dodd-Frank Financial Reform Bill“.

Not to mention, in the description of another bill that Ron Paul sponsored this year - H.R. 1496: Federal Reserve Transparency Act -  it states the Federal Reserve System is already audited.

“To amend title 31, United States Code, to reform the manner in which the Board of Governors of the Federal Reserve System is audited by the Comptroller General of the United States and the manner in which such audits are reported, and for other purposes.”

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Ron Paul and the Federal Reserve Act

Clint Richardson takes a look at the "Ron Paul campaign and makes an honest assessment of Dr. Paul's true disposition, as well as those who call him a "prophet".

Richardson asks, "Why isn't Ron Paul talking about the Comprehensive Annual Financial Report (CAFR)?" Which is the audit of the Federal Reserve, and  which does expose the true wealth of our nation, exposing the fact that government owns it all by investment.

Ron Paul won't tell you this, but federal government controls the Federal Reserve, not the other way around. The Federal Reserve is a tool which the United States Corporation uses to put us all in debt. 

The Federal Reserve Act states that it allows banks to be opened in and invested in foreign countries. The Federal Reserve Act has been amended many times. The Federal Reserve Act is prima facie law, which just means it is presumed law...that it goes on with your consent.

The Fed is the property of the United States. Assets of failed federal reserve banks go to the United States Inc, the corporate structure that rules the 50 states.  Yes, the United States is a corporation.

In other words, as I've always thought, Ron Paul is full of it.

"A gang is a group of men under the command of a leader, bound by a compact of association, in which the plunder is divided according to an agreed convention. If this villainy wins so many recruits from the ranks of the demoralized that it acquires territory, establishes a base, captures cities and subdues peoples, it then openly arrogates to itself the title of kingdom, which is conferred on it in the eyes of the world, not by the renunciation of aggression, but by the attainment of impunity" - Saint Augustine defining government

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Americans Still on the Hook for Trillions.

The global GDP is $65 trillion. The US GDP is $15 trillion. Guess how much the Federal Reserve is backstopping for Bank of America's derivatives? $75 trillion! Wells Fargo derivatives? $73 trillion! That's more than double the global GDP!

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Jackpot Capitalism: Great Fortunes Made Gambling With Other People's Money

Never before in history, have so many, amassed such spectacular fortunes in such a short period of time. Sure, during the Industrial Revolution, the robber barons became tremendously wealthy over a span of about 45-50 years. However, at the very least, this great wealth resulted from exploring new technology and/or finding new resources that did benefit society, despite the extraordinary suffering these men of spectacular fortunes caused.

Fast forward a century, and people are literally profiting immensely from the turmoil that they created. The same cannot be said of this new crop of even faster growing fortunes (approx. 10 year span). Oh, these "jackpot capitalists" have contributed more than their fair share of suffering on a global scale; however, unlike their predecessors, the robber barons, they have produced very little, if any benefit at all, to society. In fact, the opposite can be said. With access to a bull market, and the bank's capital, these new "robber barons" have single-handedly collapsed our economy with their one-way, no risk bets.

How did these individuals become wealthier than some nations? Well, engineered by the Federal Reserve, itself, most of their wealth was made on the sharp fall in the cost of money. After all, the Federal Reserve sets the interest rates for America, as well as greatly influencing global rates.


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Deep Inside Monopoly Capitalism

The following video is an adaptation of a documentary filmstrip, made sometime in the 1960s, mostly based on the book, Tragedy and Hope, by Dr. Carol Quigley. It traces the history of a small group of powerful people who control the money systems of the world. It shows how this group is protected by governments and how its wealth is derived by creating money out of nothing. We see how this group wields power through government, foundations, education, and the mass media. It has aided such regimes as Russia and China, not because it is pro-Communist, but because a visible enemy and the threat of war have been useful in persuading the masses to embrace the group's ultimate goal: a one world government which they expect to control from behind the scenes.

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As the Debt Ceiling Crisis Turns

The Federal Reserve gave out $16.1 trillion in emergency loans to U.S. and foreign financial institutions between Dec. 1, 2007 and July 21, 2010, according to "first-ever audit of the central bank". Yet, we're supposed to worry about what is essentially, chump change, in comparison? Debt ceiling crisis, my ass!

Okay, let's pretend it's real. According to Rob Johnson, Senior Fellow at the Roosevelt Institute (see video below), it's much easier to go after we, the people, than to take on Wall Street, the Military Industrial Complex, Big Pharma, etc., to pay for this so-called "crisis". As he says, it's the "logic of collective action".

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What Do North Dakota and Libya Have in Common?

We have a confused understanding of the federal money system because we base it on what we know about our own personal bank account, and we were never taught that the federal system does not operate in the same way. If you look at a chart of historical national debt and compare it to a chart of national money supply, they're the same. They both go up at the same rate. Why? Because the federal debt IS our money supply. Our money is credit and debt.

The federal government can initiate the supply of money by writing checks (debits in fed acct) that directly jumpstarts our economy. When the government writes checks to its employees, for real goods and services, that shows up as credits in real people's accounts that they, in turn, spend into the economy. The federal government can also write checks for infrastructure, which shows up as credits in commercial accounts, and creates jobs, thus creating credits in real people's accounts that they can spend into the economy.

States can create their own credit, as well. North Dakota is the only state that escaped the credit crisis. They own their own bank, which partners with the local banks and keeps credit moving within the state. So, why aren't all 50 states taking control of their money supply in the same way? Well, this would greatly threaten the international banking cartel (ibc). And, when you threaten the ibc, you end up like Libya, who had the nerve to create their own central bank that issues the money and issues credit for the nation's infrastructure, interest free; therefore, they had the lowest debt to GDP ration in the world.

However, unlike the political leaders in North Dakota, Khadaffi was trying to mobilize all of the African countries to follow his lead, while setting up an African monetary fund that would compete with the International Monetary Fund.

So, yes, we have the money to do anything we want to do. That's what money is: the credit of the nation, and the nation can advance the credit for what it needs to do.

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Tax the Federal Reserve!

Bottom up horizontal connection will bury rule by secrecy, and bloggers will be the "intelligence minutemen of this century". Well, that is, according to a former CIA officer. He said the power of the Internet, and bloggers, who "let no evil thing go unnoticed" has brought, or will bring us to a turning point that will start an "historical shift in power that will restore the constitution".

Okay, I don't know about that, but I do like his idea about taxing the Federal Reserve...a lot!

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What Should Be the Servant has Become the Master.

It's no secret that the ruling class does not want an alert and informed citizenry that can read budgets and ask critical questions. In fact, millions, if not billions of dollars are spent to keep the masses completely in the dark regarding our monetary system. Why? Those who "get it" are far more likely to fight for control.

In an overly acquisitive society such as ours, where the drive to amass obscene amounts of wealth trumps any and all regard for human life, it's time to reform our monetary system. Hence, the reason why it's so important to develop an understanding of what money really is. That is, if we, the masses, wish to not only take back our nation, but, moreover, to maintain our humanity.

Here's the thing, there is so much disinformation circulating, it's not easy to discern the truth. Nevertheless, this is some of what I've learned so far.

Economics is not a science, yet economists - in an effort to make economics, more scientific, I guess - removed "normative values" from its study. What are "normative values"? In one word, morality. Well, removing standards of ethics, honesty and morality from its study might be okay if economics followed the scientific method, and wasn't so intertwined with our survival, but it doesn't, and it is.

Unfortunately, too many economists ignore the historical origins of money, as most are trained to support the status quo...something that is clearly not working. As Alexander del Mar once said, "As a rule, economists do not take the time to study the history of money. It's much easier to imagine it and deduce the principles of this imaginary knowledge."

So, what is money? 

John Locke and Ben Franklin defined money as a pledge for wealth instead of wealth itself. However, it is Aristotle's definition: "money exists not by nature, but by law," that made "money" by it's very nature, a fiat of the law.  Now, despite the ranting and raving of the many against our fiat money system, fiat money, in and of itself, is not the problem; rather, it's fractional reserve banking...the private creation of "money" that is the problem here. Why? In a nutshell, it benefits only those who control its usurious issue.  If the money power is privately controlled, it benefits the few...if publicly controlled, it benefits the many.


It was Jeremy Bentham, best known for his advocacy of utilitarianism, and his influence upon modern welfare economics, who we can thank for redefining usury.  In a series of letters written to Adam Smith, he tried to convince Smith to give up his support for interest rate limits. Originally, the concept of usury was much more comprehensive than the mere charge of interest. According to Stephen Zarlenga, usury was the "antisocial misuse of the money mechanism for private gain".  Our entire monetary system is a usurious kleptocracy. 

Part of the "monetary" agenda consists of substituting the idea of credit for the concept of money, so that we, the people will come to think of money and credit as interchangeable, when that not true at all. Credit is only a promise to pay in the future; whereas money pays at the time of exchange. Not to mention, credit evaporates in a crisis; money does not.

What about Ron Paul and his mission to return to the gold standard?

Essentially, he is mis-defining money as a thing...in other words, as wealth. This will not give our society the ability to advance properly, because there will never be enough gold to keep pace with population and commerce growth. As history has shown,  banks will cheat and issue private bank paper that only pretends to be convertable to gold. One can only imagine the problems that would cause in a crisis. 

So back to Aristotle's defintion.  The only problem with  is that his definition is all too brief. Alexander del Mar later expanded on Aristotle with the following defintion of money:

"What is commonly understood as money has always consisted tangibly of the number of pieces of some material marked by public authority named and understood by the laws and customs that its palpable characteristic: mark of authority; essential characteristic: possession of value defined by law, and it's function: the legal power to pay debts and taxes and the mechanical power to fascilitate the exchange of other objects possessing value." -- Alexander Delmar

In other words, setting aside whatever is used to signify it - paper, metal, feathers, etc. - "money  is an abstract social power embodied in law, as an unconditional means of payment." *

Which brings us to Stephen Zarlenga's three elements (The American Monetary and Financial Securities Act) that he maintains must be included in order to create a monetary system that works for the benefit of all:

1. Put the Federal Reserve system into the US treasury so it is within our sytem of checks and balances.
2. Get rid of the fractional reserve Stop the banks from creating our money supply...any of it. If they create even 10%, they're smart enough to get all of it. Billions are being stolen under cover of law, for not only doing nothing, but for damaging and destroying society.
3. Government prints and spends new money into circulation to pay for infrastructure repair, either printed on paper or inserted on an account The key is that it's not debt; it's money.  Moreover, human infrastructure must be included:  health care and  education, as you cannot build the hardware without healthy, intelligent people. .

Source:

* Stephen Zarlenga, author of the ‘National Emergency Employment Defense Act of 2010’ (renamed The American Monetary and Financial Securities Act by Rep Dennis Kucinich, which gets rid of a private credit system, and puts into place, a government money system),  founder and director of the American Monetary Institute, and author of The Lost Science of Money

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Federal Reserve Releases 29,000 Pages of Bailout Loans that Includes Libya.

Late last week, the court ordered the Federal Reserve to release (see download zip archive link)  29,000  pages of documents that contain the complete contents of the Federal Reserve Discount Window data on loans, from August 8, 2007 to March 1 2010.  Many of these loans bail out foreign banks during the height of the financial crisis in 2008. Moreover, some of those banks are even controlled by "repressive dictators" such as Qaddafi (Arab Banking Corp, 59% owned by the Libyan central bank at the time, received 46 different loans).  That's right, the 100% Libyan owned central bank that those "ragtag bunch of rebels"  shut down so easily  in order to  immediately establish a brand new national central bank (not to mention, the brand new national oil company) received lots of  bailout money!  

Only one man, Sen. Bernie Sanders,  dared to question why billions of American taxpayer dollars bailed out a Libyan-owned bank.

Here is the emergency order that was issued by the Federal Reserve on Feb. 25, 2011, exempting the Arab Bank Corporation from the previous freeze order.

All transactions involving banks that are owned or controlled by the Govemment of Libya and organized under the laws of a country other than Libya are authorized...

So, let me get this straight. In our nation, poverty is escalating, our infrastructure is rapidly deteriorating, the middle-class is withering away to nothing, we're involved in three wars, yet, the only concern in Washington is balancing the budget on the backs of working families. Federal programs that provide suffering people basic needs and/or try to level the playing field, such as: early education, job training, post-secondary education, nutrition assistance for women and children, home heating programs for low-income people, planned parenthood, community health centers, e-gov, transportation, etc, will be slashed to the bone.

In the meantime, taxpayer subsidized banksters and corporate giants who are earning record breaking profits, continue to live off the dole. The pentagon continues to waste billions, not to mention, outright loses trillions of dollars ($2.3 trillion that Rumsfeld announced, went missing, 9/10/11).  Two-thirds of all US corporations pay no federal income tax, and almost all of the corporations continue to sit on trillions and trillions of dollars, refusing to hire, or invest any of that money back into the American economy. Despite this, slashing the corporate tax rate is top priority.

Links:

Download zip archive (129 MB)

Foreign Banks Tapped Fed’s Secret Lifeline Most at Crisis Peak

The biggest borrowers from the 97-year-old discount window as the program reached its crisis-era peak were foreign banks, accounting for at least 70 percent of the $110.7 billion borrowed during the week in October 2008 when use of the program surged to a record. The disclosures may stoke a reexamination of the risks posed to U.S. taxpayers by the central bank’s role in global financial markets.

Fed Releases Discount-Window Loan Records During Crisis Under Court Order

The Federal Reserve released thousands of pages of secret loan documents under court order, almost three years after Bloomberg LP first requested details of the central bank’s unprecedented support to banks during the financial crisis.

The records reveal for the first time the names of financial institutions that borrowed directly from the central bank through the so-called discount window. The Fed provided the documents after the U.S. Supreme Court this month rejected a banking industry group’s attempt to shield them from public view.

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Banking System Rigged to Blow if We Do Not Continue Bailing Out the Wealthy.

If you took the $1.4 trillion that was initially spent to bail out the banks and distributed it amongst financially troubled Americans, each person would receive close to $400,000.  Even better, if you took the $3.3 trillion recently reported by the Federal Reserve to bail out international as well as national banks and corporations, and distributed amongst financially troubled Americans, each person would receive close to $1 million!

Keep in mind that most of this money would be spent immediately, thus returning it to the stream of purchasing power so crucial to the economic flow.  Without a doubt, new jobs would be created as aggregate demand would increase.   Obviously, it's not that simple, however it demonstrates how rigged our financial system is to favor the wealthiest Americans.

We live in a country that has enjoyed more wealth than any other country in human history, yet we live amidst rampant unemployment, with one in six people living in poverty, and millions of people living without health insurance. We, the ordinary Americans are left to fend for ourselves while the wealthy get bailed out for "being evil".  Why? Because our banking system is rigged to blow up the global economy if we do not continue to bail the rich bastards out. Wait, isn't that what terrorists do?

Consider the following excerpt from  Marketplace:

Kai Ryssdal from Marketplace: "...the news this week that the Federal Reserve released all of those documents on Wednesday...we now know who borrowed how much and at what times.  Here's the thing though, John, as much as the WikiLeaks cables at the State Department show that our diplomats say nasty things about other countries, does it matter that we know Goldman Sachs went to the Fed 84 times?"

John Carney from CNBC: "I think it matters in that it shows how severe the financial crisis really got. That even relatively healthy banks had to depend on the Fed for funding in late 2008.  I think that is a good reminder that things were really, really, really were awful, and measures that the Fed took allowed a lot of these banks to actually stay alive.  It's very clear from the numbers that Morgan Stanley was dead. They borrowed so heavily from the Fed's facilities because there was no other way for them to continue to operate. 

Kai Ryssdal from Marketplace: What about that?

Lee Gallagher of Fortune magazine: What also was really interesting about that dump that it really drove home that it was not just the banks. It was companies like Verizon and Harley Davidson and GE and we knew back then that the commercial paper market had frozen up but most people really don't know what that means. What we see now is that companies like Harley Davidson couldn't make their payroll and needed to have those facilities."

"Need to have those facilities?"  Need??  Well, what about our needs? I thought this country belonged to us.  What about when things get really, really, really awful for us  ordinary Americans? What about when we the people can no longer operate, or survive because terrorist bankers stole our money, our jobs, our quality of life? Where is our "facility" that disperses money at 0%, so that we can loan it out at three-four times that amount?  Well?

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We the Servants of the Fed's Multi-Trillion Bailout.

Very recently, it was revealed that the Federal Reserve not only paid out trillions of dollars to Wall Street and the American elite, but they included the international elite as well. 

"The financial crisis stretched even farther across the economy than many had realized, as new disclosures show the Federal Reserve rushed trillions of dollars in emergency aid not just to Wall Street but also to motorcycle makers, telecom firms and foreign-owned banks in 2008 and 2009."

Meanwhile,  in the rest of the United States, where we the people reside, the prices of basic necessities - food, energy, and healthcare - continues to rise, as about 2 million Americans are set to lose their unemployment in December (despite proof that unemployment insurance pays off in more ways the one) and millions more will start the new year with less income due to cut-backs in state and federal government spending, underemployment, frozen wages, and frozen Social Security cost of living adjustments (COLA) which have not kept up with inflation for years as it is.

So, the transfer of wealth continues, just as,  unemployment rates, which have remained stubbornly high, since the economy crashed in 2008, continue. It's fairly safe to say that unemployment is a chronic and deep-rooted problem. Yet,  we seldom hear about the detrimental impact that unemployment can have on the economy due to insufficient income going to those who would surely spend it - we the people -  thus returning earnings back to the stream of purchasing power necessary to the circular flow of production and income.

In other words, who is going to buy back the output of the economy if most of the "income" is in the hands of the wealthy?  The rich have the option of saving and/or investing their income, and not necessarily in the United States, therefore increasing their wealth at the expense of people who have no choice but to spend their income short-circuits economic flow.

Nevertheless, despite a $13 trillion national debt, the push to give tax breaks to billionaires goes on. Republicans are demanding a two-year extension of all Bush tax cuts.

This means that the historically long duration of unemployment will more than likely have a snowball effect on the employment and earnings recovery of too many Americans, even as the economy appears to be recovering in general.

And, as always, the poor get hit the hardest:

According to the U.S. Census Bureau, median household income in the United States fell from $51726 in 2008 to $50221 in 2009.

According to the U.S. Census Bureau, 29 states reported lower median incomes than the U.S. median, while 20 states and the District of Columbia reported higher median incomes than the overall median.

The government’s formula for poverty is only based on the states with the lowest cost of living, therefore, double the federal poverty level is normally required throughout most of the US, to provide a family with basic necessities such as food and housing, according to the National Center for Children in Poverty.

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Power of the Purse: How the Wealth of the World Remains in the Hands of the Few.

"When the government fears the people, there is freedom. When the people fear the government, there is tyranny." - Thomas Jefferson

The Power of the Purse Volume 1 Part 1




The Power of the Purse Volume 1 Part 2

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Greenspan Admits To Fraud In U.S. Banking System

At the Jekyll Island Federal Reserve Conference - A Return to Jekyll Island: The Origins, History, and Future of the Federal Reserve - this past weekend, marking 100 years from the 1910 Jekyll Island meeting that resulted in legislation for the creation of a U.S. central bank, Greenspan admitted the truth:

"There are two fundamental reforms that we need: adequate capital, and two, to get far higher levels of enforcement of fraud statutes. Existing ones...I'm not even talking about new ones. Things were being done that were certainly illegal and clearly criminal in certain cases.  Fraud is a fact..fraud creates very considerable instability in competitive markets. If you cannot trust your counterparties, it won't work, and indeed, we saw that it didn't."

 

The November 1910 Jekyll Island meeting that gave birth to the Federal Reserve was shrouded in secrecy. According to author Edward Griffin, Forbes founder Bertie Charles Forbes said the event was so secret that the full names of the attendees were not mentioned once. Attendees of this "most secret expedition in the history of American finance" reportedly included the powerful Senator Nelson Aldrich and several leading bankers of the time.

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If 1928 = 2007 Then Does 1929 = 2008?

Economist Robert Reich, fascinated by the parallels between the 1929 Stock Market Crash and the Crash of 2008, looked at the research, and saw two years that stood out as having the greatest concentration of wealth at the very top: 1928 and 2007.

He writes about that and much more in his new book, Aftershock: The Next Economy and America's Future.  In particular, he was impressed with Marriner Eccles, former Chairman of the Federal Reserve between 1934 and 1948, who after much analysis, saw that the growth and concentration of income at the top created the "underlying economic stresses that caused the Great Depression."  In particular, the creation and destruction of two bubbles.

1. Middle Class Debt Bubble: The declining purchasing power of the middle class, who no longer had what they needed to keep the economy going because so much of the wealth and income in America went to the very top, so that the only way the middle class could continue spending was by going deeper and deeper into debt.
2. Concentrated Wealth Speculative Bubble: The top 1%, had accumulated so much money they started speculating  in stock, commodities and real estate.  

FDR, with the assistance of Eccles fundamentally restructured the economy.  If one thing didn't work, FDR tried another.

In 1935, FDR legalized unions and added protections for collective bargaining.  He created Social Security, the minimum wage, the 40 hour work week, with time and a half...in other words, he found ways to spread whatever prosperity there was in order to get the economy moving again.

Between that - the reorganization of the economy under the New Deal - and WWII, which put Americans to work, the post war economy became "The Great Prosperity", as Reich calls it, which lasted for 30 years.  By the late 1970s, the concentration of wealth at the top went from 23.5% in 1928 to just 9%.  Is it any surprise that the power elite hate the New Deal...hate FDR...hate...

However, not to worry:

The insufferable suffering would soon expire,
as Reverse Robin Hood appeared with bailing wire.
President Reagan, the almighty, we bow to thee;
to the rescue, lift us up, oh great missionary!
The excess wealth transfer will soon commence,
and return us from this horror to a new pretense.
-- a top 1%percenter from 1980

"It became apparent to me, as a capitalist, that if I lent myself to this sort of action and resisted any change designed to benefit all the people, I could be consumed by the poisons of social lag I had helped create. [...] ...men with great economic power had an undue influence in making the rules of the economic game, in shaping the actions of government that enforced those rules, and in conditioning the attitude taken by people as a whole toward those rules. After I had lost faith in my business heroes, I concluded that I and everyone else had an equal right to share in the process by which economic rules are made and changed."  -- Marriner S. Eccles

"As mass production has to be accompanied by mass consumption, mass consumption, in turn, implies a distribution of wealth -- not of existing wealth, but of wealth as it is currently produced -- to provide men with buying power equal to the amount of goods and services offered by the nations economic machinery. Instead of achieving that kind of distribution, a giant suction pump had by 1929-30 drawn into a few hands an increasing portion of currently produced wealth. This served them as capital accumulations. But by taking purchasing power out of the hands of mass consumers, the savers denied to themselves the kind of effective demand for their products that would justify a reinvestment of their capital accumulations in new plants. In consequence, as in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped. That is what happened to us in the twenties. We sustained high levels of employment in that period with the aid of an exceptional expansion of debt outside of the banking system. The time came when there were no more poker chips to be loaned on credit. Unemployment further decreased the consumption of goods, which further increased unemployment, thus closing the circle in a continuing decline of prices.This then, was my reading of what brought on the depression." -- Marriner S. Eccles

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