The Federal Reserve does not just 'print' money out of thin air

When the Federal Reserve has to buy back it's own treasury's because no one really wants' to buy them anymore (Because of our Debt) You 'KNOW' we're screwed...

Can you say......Banana Republic?

OP, please elaborate and link/cite some sources. I'm interested in learning, because I've been taught that they DO create money out of nothing.

The fed buying Treasuries is pure counterfeiting. Never has been done before prior to the QE1 and QE2. They are also buying 40 billion a month in mortgage debt with counterfeit money. Its all fake. Interesting that the money system hasn't collapsed. It proves that their are no laws of economics unlike the laws of physics. It's a a magick money black magick system.

"Second of all, the amount of federal reserves (not necessarily physical currency) they can create is limited by the securities they hold."

The Government prints up the treasuries, the Fed "buys" them with money they create out of thin air. That's exactly how it works. So what you are saying is not true.

They can and do create money out of thin air, all that needs happen is for the government to "borrow" money from them by making treasuries and then the fed "buying" them with their fiction money created out of nothing. Now that the fed has these treasuries, the government has to pay interest on them. That's where taxpayers come in, and is the reason why we are under crushing taxation today that is about to get worse.

So why should Americans have to be taxed to oblivion to pay interest on bogus debt sold to an entity for money they created out of nothing?

Dur, the Fed already said that:

When people say "the Fed is printing money," do they actually believe the Fed is printing money?

It would help clear up the misunderstanding if Bernanke hadn't confused things by answering this baited question thusly on his first 60 Minutes appearance in 2009:

Interviewer Scott Pelley: “You've been printing money?”

“Well… effectively. And we need to do that, because our economy is very weak, and inflation is very low. When the economy begins to recover, that will be the time that we need to unwind those programs, raise interest rates, reduce the money supply, and make sure that we have a recovery that does not involve inflation.”

What the Fed is doing is artificially propping up government debt. No one else wants that crap.

Treasuries aren't from the Fed , they are from the Treasury. The fed has no cash. It creates credits to buy treasuries out of thin air. It's all counterfeiting.

I prefer the term "circle jerk" personally.

You are correct, it is not money backed by nothing printed out of thin air.

They are in fact slave notes. Promises of slave labor of the once free American people. Every note brought into creation is an indirect tax of inflation upon the American people whenever it is created, and if there isn't enough wealth to cover the note created, then it is backed by the promise of that the enslaved people will repay the promise with their labor i.e. taxation!

Thank you for clearing that up for everyone.

Yes. It does print money out of thin air. It also creates money that does not even exist yet in the form of interest. (job security)

The money goes to the government with a T-Bill as collateral. A T-bill is always gonna be good as long as the government can tax.

The other path for the money is through the primary dealers. Money center and investment banks. They print the money and can accept ANYTHING as collateral from a the banks at any valuation. This is why they don't want to be audited. The banks can't tax, but they can foreclose, repo, etc.

you left out charging the tax payers interest on money they created out of nothing.

Your only point is invalid because money creation is based upon demand for it, not an asset backing; that ended with Nixon.

Last Edited by Intergalactic Diplomat on 12/29/2012 02:34 AM

Slave notes, once backed by gold and silver, now backed by the slave labor of present and future generations.

In 1912 there was no Federal Reserve, little national debt, and No Federal Income tax.

We are now taxed slaves!

you're right the Fed doesn't do the printing, the mint does. But the damage is not done through printed currency, it's done by creating new dollars on the computers.

There is around 100 trillion in existence, if you think there is 100 trillion dollars of cash laying around, well....you're not very bright.

Hell, there isn't 16.4 trillion dollars in cash in circulation right now.

Not correct.

There is no inherent pre existing value to currency since Nixon took us off the gold standard; No real backing for newly created money. The asset exists first; then the currency gives the asset a perceived value because other assets are assigned values using the same currency.

The gutter is the treasuries; they will take the brunt of any hyperinflation because there is nothing backing the price of assets in dollars... currency is paper; it is not valueable in and of itself.

Last Edited by Intergalactic Diplomat on 12/29/2012 02:30 AM

It really IS amazing if you stop and really look into it. The only thing that gives the dollar it's 'worth' is that we believe it's worth something...

The first part of your statement is completely false, the Fed buys (and sells) Treasurys all the time through the Open Market Trading Desk at the New York Fed: [link to www.newyorkfed.org]

Precisely.

The Fed is now buying over 60% of our own treasuries, this would be like me kiting checks to myself and collecting the money. What bullshit voodoo economics is this shit. There is no American Citizen in this country other than the private citizens of the non Federal Reserve that could get away with this shit.

UNREAL!

"The Federal Reserve bank buys government bonds without one penny..." -- Congressman
Wright Patman, Congressional Record, Sept 30, 1941

"When you or I write a check there must be sufficient funds in out account to cover the check,
but when the Federal Reserve writes a check there is no bank deposit on which that check is drawn.
When the Federal Reserve writes a check, it is creating money." -- Putting it simply, Boston Federal
Reserve Bank

"Neither paper currency nor deposits have value as commodities, intrinsically, a 'dollar' bill is just
a piece of paper. Deposits are merely book entries." -- Modern Money Mechanics Workbook,
Federal Reserve Bank of Chicago, 1975

"The Federal Reserve system pays the U.S. Treasury 020.60 per thousand notes --a little over
2 cents each-- without regard to the face value of the note. Federal Reserve Notes, incidently, are
the only type of currency now produced for circulation. They are printed exclusively by the
Treasury's Bureau of Engraving and Printing, and the $20.60 per thousand price reflects the Bureau's
full cost of production. Federal Reserve Notes are printed in 01, 02, 05, 10, 20, 50, and 100 dollar
denominations only; notes of 500, 1000, 5000, and 10,000 denominations were last printed in
1945." --Donald J. Winn, Assistant to the Board of Governors of the Federal Reserve system

"We are completely dependant on the commercial banks. Someone has to borrow every dollar
we have in circulation, cash or credit. If the banks create ample synthetic money we are prosperous;
if not, we starve. We are absolutely without a permanent money system.... It is the most important
subject intelligent persons can investigate and reflect upon. It is so important that our present
civilization may collapse unless it becomes widely understood and the defects remedied very soon."
--Robert H. Hamphill, Atlanta Federal Reserve Bank

behold the wizard, the non federal privately owned Federal Reserve Bank!



It says "in god we trust" on your currency because it is the biggest leap of faith in the entire world to believe that paper has value!

Do you have a cite for the 60% figure? Not doubting you (I mean really, who else is stupid enough to buy them at this point? That would be like me loaning money to a crackhead), just curious where you got that number from.

Good start OP, it gets so tiresome the misinfo bs that goes round. Tip: avoid any thread that has the word "fiat" in it.

You may find a better link, this is the very first I found.

Yes, because it is backed by your slavery, so that really wouldn't be fiat, good point.

You can't call it fiat, it should be called a slave auction!

That's what it really is, they are selling you and me!

Got a question, what are the names of the owners of the Federal Reserve?

Can you go to their houses and audit them?

Can we print of pieces of paper and sell them into slavery, and make them work for us?

Can we confiscate all their wealth and use it to pay down the debt they created?

Who had enough money to lend to put the entire world in debt? Answer no one.

OP is the one spreading misinfo, by implying that FRN's hold a "value" by themselves; or are backed by assets; they are not. Without a market pricing system, and the good faith that supports said system, dollars would be worth their paper value..

And "fiat" as a term referencing currency is absolutely correct; it is an ordainment; a decree by the federal reserve (which is not the government) that the money is "marketable" for use.

So you see, money is in fact backed by faith; and faith ONLY.

Last Edited by Intergalactic Diplomat on 12/29/2012 02:40 AM

Thanks but ouch, can't handle dude recording in a moving car who can't get his facts straight.

Did dig this one up from Gonzalo Lira, a great (and entertaining) financial site if you don't already read it and are interested in this stuff: [link to gonzalolira.blogspot.com]

yes, and it is this faith that people are dying for.

WOw, I guess religion really is responsible for many deaths after all. Look at all the people willing to die for this false religion of money, a complete belief system in something that is ran completely off of faith. We believe the money has value, so we agree to the slave auction or selling of our labor to back up their printing and money creation. WOW

Scary