Banks are foreclosing on homeowners left and right these days, but how are they allowed to do this when the only thing they’ve brought to the negotiating table is ink? Before we can begin to grasp the concept of illegal foreclosures and the diabolical nature of the world banking system, we have to understand how banks are allowed to create money out of thin air.
The monetary system is one of the most misunderstood institutions and one of the most unquestioned forms of faith in today’s world where 1% of the population owns 40% of the wealth. Because of the complicated banking formulas and the complex mathematics that supports it, most people balk at trying to understand one of the most paralyzing institutional structures ever created.
What I’m about to explain can be found in the Federal Reserve’s own publication called, Modern Money Mechanics, which explains the institutionalized practice of creating money. Bear with me for a minute as I attempt to unravel this complex monetary conundrum. The U.S. government wants borrow $10B from the Fed. Just a few words about the Fed for readers who think it may be part of the United States government. It’s not. The Federal Reserve is a privately owned corporation called the Central Bank. One of the Rothchilds of the London banking system put it this way, “It (Central Bank) gives the National Bank almost complete control of national finance. The few who understand the system will either be so interested in its profits, or so dependent on its favors, that there will be no opposition from that class… The great body of the people, mentally incapable of comprehending, will bear its burden without complaint, and perhaps without even suspecting that the system is inimical (contrary) to their interests.” The Federal Reserve act was pushed through Congress before the Christmas of 1913 by Nelson Aldrich, the maternal grandfather to the Rockefellers. Aldrich represented a group of bankers who funded and staffed Woodrow Wilson’s campaign. When elected, Wilson passed the FED. Later, Wilson remorsefully replied (referring to the FED), “I have unwittingly ruined my country.” Find out more at: http://www.apfn.org/apfn/fed_reserve.htm
So, the U.S. government wants to borrow $10B from the Fed. The Fed, in turn, buys $10b in government bonds or Treasury Bonds. The Fed prints up $10B in Federal Reserve Notes, or dollars, in exchange for the bonds. The government then takes the $10B and deposits it in a bank and this newly printed currency becomes official legal tender. Ten billion dollars of new money was just created electronically since no money exchanged hands. Actually, only 3% of the US cash supply that exists today is actually physical currency. The rest is stored in computers. In return, the government promises to pay back the money that was created out of debt.
Here’s where it gets good. The $10B is deposited in the bank where it becomes part of the bank’s reserves which must equal its deposits, which is usually about 10%, or in this case, $1B. The other $9B is considered an excessive reserve and can be used to make new loans. So $9B is created out of thin air and added to the original $10B giving the bank now $19B and this is how the money supply is expanded according to Modern Money Mechanics. “Of course, they do not really pay out loans from the money they receive as deposits. If they did no additional money would be created.
Next, someone borrows the $9B and deposits it in their own bank account. Again 10% of the $9B that was deposited becomes part of the bank’s reserves for an additional $900M, so now $8.1B (90%) is available as newly created money that can be loaned out so the wheel keeps spinning. In the end, $90B can be created from the original $10B. What does that mean? For every deposit that ever occurs in the banking system, 9 times that amount can be created out of thin air. This is well documented in the movie, Zeitgeist Addendum by Peter Joseph. (See video)
This practice was exposed in a landmark case called the Credit River Decision. In 1968, Jerome Daly, a Minnesota lawyer who was well aware of this synthetic process of creating capital, took the 1st National Bank of Montgomery to court over his foreclosure. Daly, defending himself, did something unprecedented by accusing the bank of failing to put up anything for consideration except the ink that was on the paper and loaning the money back to him as if it were already on the books. When questioned, bank president Lawrence V. Morgan admitted that the bank had risked nothing and that this was the standard practice in banking. Justice Martin V. Mahoney ruled against the bank and denied the foreclosure. Mr. Daly kept his house and paid no more on his mortgage. Here’s the rub. Six months later, Justice Mahoney died in a boating accident but, oddly enough, his body had been pumped full of poison. What followed was an uproar starting with the State Bar and ending when the State Supreme Court came to the aid of the banks and ruled that the entire case was null and void. Read more at: http://www.educationcenter2000.com/legal/credit_river_decision.htm
Once again, the government that is supposed to protect and represent homeowners, sold them out so foreclosures are now, in practice, legalized theft of property.