Tuesday, March 20, 2012

The Federal Reserve: What should have outraged Occupy

The Federal Reserve: What should have outraged Occupy

The economic realities, that I would humbly submit, that more people need to know...

Consider this scenario:

The State determines that it will create a fiat currency.

The fiat currency is not money, per se, but a financial instrument representing a debt of the State, to be paid to the holder of the currency.

State fiat currency isn't truly money; the currency is actually a financial instrument representing the State's debt; it is a debt the State owes the bearer.

The State, redeems this debt-currency by accepting this debt-currency for payment of taxes.

The State, claims that a citizen owes it a debt, and then the State accepts the debt-currency as payment of this tax-"debt".

The State makes a threat to all citizens, that it will punish anyone refusing to accept the debt-currency as payment for all private debts.

The fear of punishment, forces the debt-currency to be accepted as if it was a market-currency or money.

Then the State, gives to a coalition of the largest private banks the "authority"/permission to print/create the debt-currency; this coalition of private-banks, having exclusive monopoly-privilege to create/print new debt-currency, calls itself "The Federal Reserve"

The State is incentivized to pay for all current political desires through borrowing, rather than taxation (the imposition of debt claims on others). Paying for current political desires through taxation, means that people must pay today, what is spent today; since it is a general rule of economics that a person would rather receive a desired thing, sooner, rather than later, and would rather pay back a debt, later, rather than sooner, it is always in the interest of the politicians/agents of the State to pay for political desires through borrowing against the future than to pay for political desires through taxation.

Then, the State, wishing to borrow money, to provide for current political desires, without having to tax (impose debt claims on others), it borrows money from the private coalition of banks, calling themselves, the "Federal Reserve". The "Federal Reserve", using its State-granted monopoly-privilege of creating money (legal counterfeiting), creates new money to give to the State, which the State spends on current political desires, and which the State promises to pay back in the future, at interest.

Therefore, the State, pays an interest premium, on debt, that was created by its own permission to the Federal Reserve, to create new debt-currency. The State, rather than creating new currency on its own, and spending it on current political desires, it creates a debt-obligation to a coalition of private banks, that the State gives permission, to create new currency.

Persons, that have not yet been born, will have new claims-of-debt-obligation imposed upon them (taxation), to pay back, with interest, the debt owed to the coalition of private banks (the Federal Reserve), given permission by the State to legally counterfeit currency.

The children of tomorrow, will (presumably) be burdened by the rapacity of today.

If Occupy is outraged, this is what they should be outraged about.


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