I haven’t written anything on this blog for a very long time. I plan on writing regularly. Stay tuned.

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Change!

Change You Can Believe In!

Nearly one year later and what real change?  The Patriot Act isn’t opposed by Obama.  The Employee Free Choice Act it dead.  We are still spending tons of money on futile “wars” in Iraq and Afghanistan.  The banks are robbing the people blind.  The insurance companies are taking most of what the banks don’t get.  Real assets are being transferred to the banks at an alarming rate. I could write many many more examples.

What change? I want to know what “change you can believe in” is there?

The basic philosophical reason the American colonies fought for liberation from England centered on the concept of representation. The colonists were opposed to the idea of Parliament “representing” their interests when parliament had become a, “deliberative assembly one nation, with one interest, that of the whole, where, not local prejudices ought to guide, but the general good, resulting from the general reason as a whole.  Instructions, therefore from particular constituents to their own Members are or can be only of information, advice, and recommendation . . . but not absolutely binding upon votes and actings and conscience in Parliament” (Bailyn).

Prior to this period, the members of parliament acted as “attorneys” in the interest of their constituents.  The idea of Members of Parliament acting for the good of the whole in opposition to the wishes of their particular constituents who elected them and who they represented was refuted throughout the colonies.  This idea of “virtual” representation was (and is in my opinion) “too ridiculous to be regarded” as colonist James Otis wrote.

Given this, I find it absolutely un-American that our Congress continues to ignore the wishes of the people in the interest of “the country.

I’ve been thinking about perspective a lot in the last couple of days and have decided to provide here a little perspective on The Great American Theft AKA the bailout of the banks.

According to documents posted by the Department of Treasury, under the “Capital Purchase Program”, We The People, under the guise of the Department of the Treasury, purchased preferred stock in these companies with this much borrowed money:

Bank of America:  $10,000,000,000

Goldman Sachs:  $10,000,000,000

Morgan Stanley:  $10,000,000,000

Citigroup:  $25,000,000,000

JP Morgan Chase:  $25,000,000,000

Wells Fargo:  $25,000,000,000

Bank of New York Mellon:  $3,000,000,000

State Street:  $2,000,000,000

Merrill Lynch:  $10,000,000,000

and the total purchase price under the “Capital Purchase Program is:  $110,000,000,000.

Under the “Targeted Investment Program, We The People, under the guise of the Department of Treasury, purchased securities from Citigroup for $20,000,000,000 with borrowed money.

In order to save, “Systemically Significant Failing Institutions”, We The People, under the guise of the Department of Treasury, purchased AIG securities with $40,000,000,000 of borrowed money.

The Grand Total of what I can decipher out of the documents posted by the United States Treasury thus far is:  $170,000,000,000.

I haven’t gone through in detail, so I don’t know if I’m missing anything.  I don’t believe that all of the agreements have been posted yet either.  For the time being, let’s put this $170,000,000,000 in perspective.

According to the most recent U.S. Census data, the median household income for 2007 was $50,740.
$170,000,000,000 is enough money to pay the entire median household income for one year to 3,350,413 households.

According to the U.S. Census, the median home value in 2007 was:  $191,471 $170,000,000,000 would buy 888,762 homes at this median price.

According to the National Coalition on Health Care the average cost of health care per person in 2007 was $7,900 $170,000,000,000 would pay the entire health care bill under the present system for 21,518,987 people.

I won’t even get into the interest on this borrowed money or any details at this point.  I just wanted to give some perspective.

If any of this angers you, speak out, educate, and be vigilant.

Call Congress at 202-225-3121.

What can I say?  We have just survived the worst presidency in history, filled with blatant corruption, tyranny, and disregard for any and all laws both human and natural.  The economic situation is getting worse every day.  The front page of the Minneapolis Star Tribune headline stated, “

Monday jobs massacre: 55,000 lost

”.  My hometown has a population of around 8,000 people and it’s a relatively large town in it’s neck of the woods.  I think of everyone in my home town and all towns within a 50 mile radius losing their jobs in ONE DAY and I nearly cry.

This is tragic on so many levels.

The loss of jobs causes a loss of income causing a loss of purchasing power causing a loss of demand for goods and service causing a surplus causing less production and distribution causing a loss of jobs and on and on and on and on.

It’s the deflationary cycle.  The decreased demand causes prices to fall and more of the above.

What can be done to stop it?

Well, as far as I can figure, it comes down to money.  Now I’m not talking about money in the sense that you’re probably thinking about money.  I’m talking about a whole paradigm shift regarding money.

If you read my earlier posts, you have an idea of how money is created in our economy through the banking system.  Now I want to share a piece of the Constitution of these United States of America.  Article I Section 8 gives Congress the power,  “To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures”.

Hmmm.  It seems that the fact that we borrow our money from the Federal Reserve and have given the Federal Reserve the power to regulate the value of our money through supply and demand controls such as interest rates and “infusions into the money markets”, is counter to the law of the land.  What if the United States Treasury nationalized the Federal Reserve as a regulatory agency and monetary clearing house, and started printing it’s own money as the Constitution states?  What if the United States Government (also known a s We the People), then printed the 1.6 trillion dollars needed to repair our infrastructure and proceeded to execute a plan to do so?  What if we provided universal single payer health care the same way?  What about free post secondary education?

What about the right of the people?

I am tired and haven’t had a lot of good writing time today so I decided to write a short post related to yesterday’s post about banking, bailouts, and theft.  If you recall, the 700 billion dollar bailout was requested by the financial industry last fall.  It was presented to congress as a “do or die” scenario.   Either you give us this money or the entire world financial system will collapse.  The reasons given for needing the money revolved around losses due to subprime mortgage lending and the subsequent freezing of credit markets.  There was a lot of talk in the news about banks being afraid to lend money even to each other.  The talk was that interbank lending had ceased and banks had quit loaning money to basically anyone.  We heard it straight from Secretary of the Treasury Henry Paulson and head of the Federal Reserve Ben Bernanke.

 

The problem with this is that none this was even close to true. A report from the Minneapolis Federal Reserve Bank titled “Working Paper 666” states that “Figures 5A and 5B display data for interbank loans made by all U.S. commercial banks.

These Figures show that, at least in the aggregate, interbank lending is healthy. The second claim, that the volume of interbank lending has fallen sharply, is false, at least as of October 15.”   As far as lending to businesses and consumers the report states, “Figure 1B displays the same data from the beginning of 2008 onward. Bank credit consists of the aggregate amount of assets held by these banks excluding vault cash. As is clear from these Figures, bank credit has not declined during the Financial crisis. Indeed, bank credit appears to have risen relative to trend in the month of September. Figures 2A and 2B display analogous data for loans and leases made by U.S. commercial banks. Again, we see no evidence of any decline during the  Financial crisis. Figures 3A and 3B display data for commercial and industrial loans. Again, we see no evidence that the Financial crisis has affected lending to non-financial businesses. Figures 4A and 4B display data for consumer loans and show no evidence that the financial crisis has affected consumer lending.”

 

Again, why are we giving the financial industry our money?  Why aren’t we fixing infrastructure, investing in education, and providing health care with this money instead?  

Where does money come from? This is one of the most important concepts in our society, and I have met very few people who can answer the question. At least 90% of our money is created out of thin air through bank loans. It isn’t handed out by the government or printed as cash. It is created at local banks through loans.
When you go into a bank to get a loan to buy a house, you fill out a bunch of paperwork, the bank checks your credit etc., you sign the mortgage, and the bank credits your account with the money. You then pay for the house. Many people think that when the bank credits your account with the money, the bank is transferring money from the bank’s pile of money into yours. This is not true.
Banks are subject to a reserve requirement imposed by the Federal Reserve. This reserve requirement was essentially eliminated by Allen Greenspan. This reserve requirement stipulates how much money can be loaned in relation to the banks assets which include cash and deposits held for the bank at Federal Reserve banks. What are the reserve requirements? According to a paper at the Federal Reserve Bank of New York’s Web Site, for 70% of banks they are zero.
What does this mean? This means that when you go into a bank and sign the promissory note (mortgage) for a $200,000 house, the bank can just credit your account with $200,000 without moving any money from anywhere. This is stated directly in a report by the Federal Reserve Bank of Chicago. The have literally created $200,000 with that transaction. In reality they have also created the need for much more money, since you need to pay interest on that $200,000. I’ll address the interest in the future. With this system in place, why do we need to give the banks what amounts to $2,200 for every human in this country?