Economy Rigging 1

Banking Ponzi May 28, 2012

Filed under: Uncategorized — bashstreetkidjailbreak @ 10:25 pm


t’s interesting to note that at all times economists and most citizens assume that the current system of governments borrowing money at interest from private banks and other financial institutions on the so-called ‘free-market’ is the natural way to finance the state.

Remember, the banks are bankrupt…so where does that leave us?

Consider Draghi’s munificence to the sum of 1 trillion Euros of cheap (1%) credit to the European zombie banks; and ask how is this supposed to help the European national economies.

This is how it works:
1. the banks are bankrupt
2. the central bank loans them money at minimal interest
(1% in Europe; 0% in the USA)
3. the banks then loan the money to governments (by buying bonds).

Where does the money in the central bank come from?
It is invented….created out of thin air as credit/debt.
What is the basis of its value…or what is the basis of the power of the ECB to create the credit/debt?

Answer: the future wealth and taxability of European citizens…us in other words.

So money is created by the central bank on the basis of our future work and productivity and given at minimal interest to banks who then loan it back to us at higher rates of interest.

If that is not crazy, I dont know what is.

  • It is true that the ECB can create money through making accounting entries in bank accounts.

    The fact that the ECB creating a trillion euro was such an extraordinary event probably made you wonder who creates euros in the normal run of things, if not the ECB.

    It is the commercial banks which create euros by crediting the borrower’s account when they process loans. This is the source of the debt crisis and indeed many of our social problems.

    I’m not sure if you’re aware but banks also delete money as a loan repayment is processed and so reducing our debts reduces the money supply by the same amount. This is why there is less money during a recession. It is pretty crazy alright.

    One solution to the crisis would be to declare all bank-account money as legal tender and this would allow the Central Banks to create debt-free digital money as well as cash for their Governments.


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