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GeordieAndy

Is This The Video That Will Finally Make People Get It?

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This 30 minute video is being linked to by a LOT of top financial people and although they use USA as the example I think this is one of the clearest explanations of what's going on today:

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This 30 minute video is being linked to by a LOT of top financial people and although they use USA as the example I think this is one of the clearest explanations of what's going on today:

Thanks for that, has answered some questions

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Thank you for posting that. I don't normally watch the video links (short attenion span...?) but that one was interesting and well worth the concentration it took :)

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Quick question - the first method of creating currency shown at the start is describing QE right? Ie the treasury issues bonds, the banks buy them then sell them to the Fed, who buy them with money that they don't have. Am I wrong or is this only describing the QE mechanism? If so, it seems a bit 4rse backwards to explain that before fractional reserve banking. In a way, it almost normalises QE, which I don't think should be the case.

Unless I'm wrong, but I don't know of any other reason for the Fed to be buying treasuries off the banks with an unbacked "cheque"?

Edit to answer own question - Open Market Operations, although as far as I'm concerned, it's the same intention, just to varying degrees.

Edited by Fully Detached

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Quick question - the first method of creating currency shown at the start is describing QE right? Ie the treasury issues bonds, the banks buy them then sell them to the Fed, who buy them with money that they don't have. Am I wrong or is this only describing the QE mechanism? If so, it seems a bit 4rse backwards to explain that before fractional reserve banking. In a way, it almost normalises QE, which I don't think should be the case.

Unless I'm wrong, but I don't know of any other reason for the Fed to be buying treasuries off the banks with an unbacked "cheque"?

Edit to answer own question - Open Market Operations, although as far as I'm concerned, it's the same intention, just to varying degrees.

The issue of money shouldnt be by buying the asset...the banks should be borrowing from the FED using their Government Gilt assets as collateral.

There really is no reason at all why the Government shouldnt just issue money which the banks borrow direct from the treasury.

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Just watched the whole thing. Like the Fully Detached, I find steps 1-2 a bit more challenging and I'll have to think about it some more.

I'm more used to the Positive Money approach to focus on the commercial bank money creation, but I guess this is the bigger picture.

Shame they had to ruin it at the end with the precious metals plug... It's like MoneyWeek - "protect your family" - scaremongering...

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A lot of scaremongering factoids for the net-educated. Of course, quite a lot of it was true. How do people know how to separate the wheat from the chaff?

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I ended up watching the second half. Even worse. It states that banks own the federal reserve. Utter nonsense. A bit like the idiots who claim that the bank of England is owned by the Rothchilds.

Also, I don't want to be too pedantic but if he is so clever, surely he would know the difference between "you and me" as opposed to "you and I".

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I ended up watching the second half. Even worse. It states that banks own the federal reserve. Utter nonsense. A bit like the idiots who claim that the bank of England is owned by the Rothchilds.

Also, I don't want to be too pedantic but if he is so clever, surely he would know the difference between "you and me" as opposed to "you and I".

i think the problem stems from the 6% dividend paid to member banks, holders of the fed stock as it were.

Member banks ("[a]bout 38 percent of the nation's more than 8,000 banks")[24] are required to own capital stock in their regional banks,[24][25] and the regional banks pay a set 6% dividend on the member banks' paid-in capital stock (not the regional banks' profits) each year, returning the rest to the US Treasury Department.[26] The Fed has noted that this has created "some confusion about 'ownership'":

[Although] the Reserve Banks issue shares of stock to member banks...owning Reserve Bank stock is quite different from owning stock in a private company. The Reserve Banks are not operated for profit, and ownership of a certain amount of stock is, by law, a condition of membership in the System. The stock may not be sold, traded, or pledged as security for a loan....[27]

In his textbook, Monetary Policy and the Financial System, Paul M. Horvitz, the former Director of Research for the Federal Deposit Insurance Corporation, stated,

...the member banks can exert some rights of ownership by electing some members of the Board of Directors of the Federal Reserve Bank [applicable to those member banks]. For all practical purposes, however, member bank ownership of the Federal Reserve System is merely a fiction. The Federal Reserve Banks are not operated for the purpose of earning profits for their stockholders. The Federal Reserve System does earn a profit in the normal course of its operations, but these profits, above the 6% statutory dividend, do not belong to the member banks. All net earnings after expenses and dividends are paid to the Treasury.[28]

In the American Political Science Review, Michael D. Reagan[29] wrote,

...the "ownership" of the Reserve Banks by the commercial banks is symbolic; they do not exercise the proprietary control associated with the concept of ownership nor share, beyond the statutory dividend, in Reserve Bank "profits." ...Bank ownership and election at the base are therefore devoid of substantive significance, despite the superficial appearance of private bank control that the formal arrangement creates.[30]

http://en.wikipedia.org/wiki/Criticism_of_the_Federal_Reserve

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I ended up watching the second half. Even worse. It states that banks own the federal reserve. Utter nonsense. A bit like the idiots who claim that the bank of England is owned by the Rothchilds.

Also, I don't want to be too pedantic but if he is so clever, surely he would know the difference between "you and me" as opposed to "you and I".

I would have expected it to be HM Bank of England if it was truly state owned though.

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A lot of scaremongering factoids for the net-educated. Of course, quite a lot of it was true. How do people know how to separate the wheat from the chaff?

If you could not sort the wheat from the chaff, you obviously did not understand it.

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i think the problem stems from the 6% dividend paid to member banks, holders of the fed stock as it were.

http://en.wikipedia.org/wiki/Criticism_of_the_Federal_Reserve

Thank you for confirming my fears. The problem with these highly professional looking videos is that they present easily verifiable fiction as fact on the basis that the net - educated will not seek a second opinion.

The video closes with a couple of actions for viewers: to watch the video over and over again until all the arguments have been learnt and then to distribute it widely. Those sound like the techniques of a religious cult.

A lot of people here think that this shows how the system really works because it tells them what they want to hear while deriding the so-called sheeple for not watching these misinformation videos.

Grrrr (cross face)

Edited by Ah-so

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If you could not sort the wheat from the chaff, you obviously did not understand it.

The video introduces falsehoods in amongst facts to confuse the casual viewer.

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The video introduces falsehoods in amongst facts to confuse the casual viewer.

The perfect counter to the Bankers Tale of prudence, care and proberty..

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I would have expected it to be HM Bank of England if it was truly state owned though.

Well, your expecation is not proven by reality. The Bank of England is legally a company, but 100% of its shares are owned by HM Treasury. No doubt that prior to its nationalisation after the War shares were owned by all sorts of people and institutions, but that is not the reality today.

Edited by Ah-so

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Such as the Federal Reserve being owned by the private banks.

The court case Lewis v. United States, 680 F.2d 1239 (1982) ruled that Federal Reserve Banks are "independent, privately owned and locally controlled corporations",

In any case, how does that alter the pyramid scheme characteristics of the monetary system ?

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