What's Wrong with Our Monetary System?

Read this:

http://www.apfn.org/apfn/...

Watch this:
http://www.youtube.com/wa...

Good Luck America,Good Luck Ron Paul

I had seen a few clips, but thanks for putting it all together in one!

To those bloggers who accuse us of crimes, or worse, Ron Paul of being involved in 'frauds or scams', you have been put on notice. And in this video you will learn that the Federal Reserve is the biggest scam and fraud of our country's lifetime.

While the feds are grabbing a few million $ of Liberty dollars and coins from people trying to ptotect their assets, we have trillions of useless paper about to collapse the global financial system and the culprits are awarded $38 billion in bonuses this year alone. Wake up America.

http://www.bis.org/press/...

Dear Arlen,

According to the BIS report, just the Credit and Credit Default OTC derivatives are above $20 trillion nominal value by themselves. Nominal value becomes real value when the special performance contract is called on to do its special performance. They are now called on, and have to a very large degree failed. Because of this fact there is no value. If there is no value then the value is zero.

The total amount of derivatives outstanding is approximately $450 trillion, of which $400 trillion are over the counter derivatives with the characteristics listed below.

Wherever London Financial Times got their number fits the diversion operation "White Noise."

If as the London Financial Times says, the estimate of world investment in total is around $145 trillion then the comparison is to 450 trillion nominal value derivatives outstanding.

OTC derivatives can and will tear the financial world a new rear end by June of 2011.

Where $2 trillion is concerned, I have only one comment, "Bull Shit."

Regards,
Jim

Keep in mind that over the counter derivatives generally have the following characteristics.

Without regulation.
Without listing on public exchanges.
Without standards.
Therefore not in the least bit transparent.
Therefore without an open market of the bid/ask type.
Dealt in by private treaty negotiations.
Without a clearinghouse.
Unfunded without financial guarantee of any kind.
Functioning as contracts of specific performance.
Financial character or ability to perform is totally dependent on the balance sheet of the loser in the arrangement.
Evaluated by computer assumptions made by geek, non market experienced mathematicians who assume religiously that all markets return to their normal relationships regardless of disruptions.
Now in the credit and default category alone considered by accepted authorities as totaling more than USD$20 trillion in notional value.
Notional value becomes real value when the agreement is forced to find a real market for ending the obligation which is how one says sell it.

Posted On: Monday, November 19, 2007, 4:11:00 PM EST

In The News Today

Author: Jim Sinclair www.jsmineset.com

Great post and great news...thanks for sharing. When you get people like Forbes and other monetary savy investers supporting Ron Paul, word gets out fast.

Money and Debt: A Solution to the Global Crisis
by Thomas H. Greco, Jr.
Second Edition, 1990
pp. 26-27

http://circ2.home.mindspr...

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In addition to the above, there is active discussion of the monetary system and a broad-based effort to abolish the Federal Reserve System. This too has been largely ignored by the media.

Some pertinent facts are:

1. There is a national movement which is challenging the constitutionality of the Federal Reserve System and the monetary monopoly, and is seeking to make it a political issue.

2. The National Conference of State Legislatures has 4 times voiced its concern over the monetary system and has called for the states to act to challenge it.

3. The legislatures of 5 States (Arizona, Alabama, Indiana, Idaho and Utah) have passed resolutions calling for repeal of the Federal Reserve Act and 12 more are considering it. (CRC Bulletin #287, May 1986).

4. During 1987, the Legislature of the State of Washington voted to hold a 26 referendum on a proposal to have that State bring suit in U.S. Supreme Court challenging the constitutionality of the Federal Reserve System. The 1987 elections included the referendum, and while it did not pass, proponents managed to garner 36% of the vote in favor of the referendum - this with minimal resources to mount only a very modest informational campaign, and “slanted and inaccurate information” put out by the Washington (state) Bankers Assn. (“Honest Money for America,” vol.4, #4, Dec. 1987)

Other developments of probably greater importance are 1) the rediscovery of a vast body of Monetary Freedom literature, 2) the dedicated efforts of a small corps of modern theoreticians who are exploring the nature of money and alternatives for mediating the exchange process and, 3) the growing number of alternative exchange and local currency systems which are beginning to spring up in diverse places. Models are being developed and tried. The most promising approach appears to be the creation of a network of locally controlled (credit) exchanges similar in their essentials to those developed by Michael Linton. Linton’s design, called LETS, for Local Employment and Trading System provides for the facilitation of exchange within a limited area or group without the imposition of interest charges, the use of legal coercion or the establishment of any privileged class. (See Linton and Greco, “The Local Employment Trading System,” Whole Earth Review, vol. 55, Summer 1987).

So who do you believe? This is the one thing that I am having doubts with. Could this be a very deceptive ploy with a candidate layed upon us under the assumption of freedoms? Maybe he is a pawn without his knowledge? How else would it go down so easily in this country? Who the heck can you believe? Please help me with this one. We cant afford to make a mistake here. I dont want to be the unsurper of my own liberty any further than I already have. Let me know your thoughts on this.Thank You.

This is just another Problem-Reaction-Solution by the Elite to shove the Amero down our throat. Virtually the same thing was done when they wanted the Euro to become the currency of choice. Let's not forget that a lot of Europe did not want the Euro when it was initially proposed. However, sink the current national currency and watch the Euro come to the rescue. Exact same thing is happening here in North America with the Amero.

"None are more hopelessly enslaved than those who falsley believe they are free."
-Goethe

The Amero and NAU becomes more easily acceptable if the currencies are closer in the exchange rates. A financial meltdown will cause people to look to government for solutions due to the decades of conditioning. Then miraculously the Feds will solve everything with the NAU. Life becomes wonderful. Well, except for the loss of our liberty. But we really don't need that with this all caring government.

Has anyone thought this? Please reassure me. What happens if the dollar crashes and we usher in something to keep it stable. Has anyone heard of the Amero? Could this be the final nail in our coffin? Could this be the goal of the elitists? This could be the final push for the North American Union? I have to look at all sides of this. Please let me know your thoughts on this. Thank You.

"The Federal Reserve System implements monetary policy largely by targeting the federal funds rate. This is the rate that banks charge each other for overnight loans of federal funds, which are the reserves held by banks at the Fed. This rate is actually determined by the market and is not explicitly mandated by the Fed. The Fed therefore tries to align the effective federal funds rate with the targeted rate by adding or subtracting from the money supply through open market operations. The late economist Milton Friedman consistently criticized this reverse method of controlling inflation by seeking an ideal interest rate and enforcing it through affecting the money supply since nowhere in the widely accepted money supply equation are interest rates found."

Summary: The Fed "prints" money to affect the lending market rates -- the more money they print, the cheaper it is for banks to get a loan, and the better the bank's bottom line.

"The Federal Reserve System also directly sets the "discount rate", which is the interest rate that banks pay the Fed to borrow directly from it. However, banks usually prefer borrowing fed funds from other banks, even at a higher interest rate, rather than directly from the Fed, because that might suggest problems with the bank's credit-worthiness or solvency."

Summary: Banks could, and occasionally do, borrow money directly from the Fed, but generally try not to. The Fed's role as lender is essentially unimportant, because of this.

"Economists from the Austrian School and the Chicago School who want the Federal Reserve System abolished. They criticize the Federal Reserve System’s expansionary monetary policy in the 1920s, arguing that the policy allowed misallocations of capital resources and supported a massive stock price bubble. They also cite politically motivated expansions or tightening of currency in the 1970s and 1980s.

Milton Friedman, leader of the Chicago School, argued that the Federal Reserve System did not cause the Great Depression, but made it worse by contracting the money supply at the very moment that markets needed liquidity. Since its entire existence was predicated on its mission to prevent events like the Great Depression, it had failed in what the 1913 bill tried to enact. This is also the current conventional wisdom on the matter, as both Ben Bernanke and other economists such as the late John Kenneth Galbraith--the latter being an ardent Keynesian--have upheld this reasoning. Friedman also said that ideally he would "prefer to abolish the federal reserve system altogether" rather than try to reform it, because it was a flawed system in the first place. He later said he would like to "abolish the Federal Reserve and replace it with a computer," meaning that it would be a mechanical system in nature that would keep the quantity of money going up at a steady rate. Friedman also believed that, ideally, the issuing power of money should rest with the Government instead of private banks issuing money through fractional reserve lending."

"Ben Bernanke, the current Chairman of the Board of Governors, apparently agrees with Friedman's assessment, saying in a 2002 speech: "I would like to say to Milton [Friedman] and Anna [J. Schwartz]: Regarding the Great Depression. You're right, we did it. We're very sorry. But thanks to you, we won't do it again.""

"Economists of the Austrian School such as Ludwig von Mises contend that the Federal Reserve's operation amounts to an artificial manipulation of the money supply and has led to the boom/bust business cycle occuring over the last century. Many economic libertarians, such as Austrian School economist Murray Rothbard, believe that the Federal Reserve's manipulation of the money supply to stop "gold flight" from England caused, or was instrumental in causing, the Great Depression. See Austrian Business Cycle Theory. In general, laissez-faire advocates of free banking argue that there is no better judge of the proper interest rate and money supply than the market."

Just to piggyback on this important forum, have you all seen the US Comptroller, David Walker, speak on this issue:

http://www.youtube.com/wa...

He says, "The most serious threat to the United States is not someone hiding in a cave in Afghanistan or Pakistan, but our own fiscal irresponsibility."

very good video on a number of topics

Jim Rogers on the dollar and his investments. He does mention Ron Paul.
http://www.youtube.com/wa...