The Federal Reserve produced a document called Modern Money Mechanics detailing how the Federal Reserve will work:
The United States decides it needs 10 billion dollars so it calls the Federal Reserve. The Fed responds with fine, we’ll buy 10 billion worth of government bonds from you. The government takes some official looking bits of paper and paints some designs on them, call them bond, and sends them over to the Fed. In turn the government draws up official pieces of paper and calls them Federal Reserve notes. The Fed then takes these notes and exchange them for the bonds. The government the deposits the money in a bank account and calls them money. The government is then free to lend them out. And that is how 10 billion dollars is created. Only 3% of the government money exists in paper money, the other 97% only exists in digital form.
When the money is created out of nothing, the government is promising to pay back the money plus interest to the Fed. This means it is impossible to pay back the entire debt.
That 10 billion dollars now become part of the bank's wealth, this is where fractional reserve banking comes in. As quoted in Modern Money Mechanics: a bank “must maintain legally required reserves… equal to a prescribed percentage of deposits” it goes on to say “under current regulations, the reserve requirements against most transactions is 10 percent” This means that of the 10 billion
10, 000, 0000, 000
1, 000, 0000, 000 is held as the excessive reserve
9, 000, 0000, 000 is used as the basis for new loans
The 9, 000, 0000, 000 is created on top of the 10, 000, 0000, 000 making a total of 19, 000, 0000, 000
The process is then repeated
9, 0000, 000 is held as the excessive reserve
8, 100, 000, 000 is used as the basis for new loans
The 8, 100, 000, 000 is created on top of the 900, 0000, 000 making a total of 27, 100, 0000, 000
8, 810, 000, 000 is held as the excessive reserve
8, 7.290, 000, 000 is used as the basis for new loans
The 7.290, 000, 000 is created on top of the 8, 100, 000, 000 making a total of 34, 390, 0000, 000
This process can go on forever, approximately 90, 000, 000, 000 can be created on top of the initial 10, 000, 000 created by the Fed. For every deposit created out of thin air about 9 times that amount can be created. This is how the money supply is expanded.
What is giving the new money value, answer the old money? Because the current monitory system is not backed by anything it steals its value from the money already in circulation. This is referred to as inflation. Prices rise diminishing the purchasing price of every dollar.
Inflation is a hidden tax on the public. The act of expanding the money supply without there being a proportional expansion of goods and services in the economy will always debase a currency. One dollar in 1913 required $21.60 in 2007 to match it. That is a 96% devaluation since the Federal Reserve came into being.
If there were no debts in our money system there wouldn’t be any money. All money is created out of debt. Therefore all money is debt and all debt is money.
The last time the national debt for the US was paid off was 1835 when President Andrew Jackson closed down the second Federal Reserve Bank of America.
According to a report, entitled the Federal Reserve directives, the study of corporate bank influences conducted by the committee on currency and housing also representative in August 1976 It was concluded that all major financial banking cartels of the United States are all subsidiaries of the London Bank of England. In other words, the NM Rothschild Bank owns every major bank in the United States. This list includes Lehman Brothers, Morgan Stanley, recently dissolved from the creative economic crisis national City Bank, Chase Manhattan Bank, and many others.
Every time a taxpayer pays his tax he’s transferring his labour to the Queen of England and all of her heir. Her heirs include all of the Presidents and high office officials, who are related to the autocracy by blood. These officials are more commonly known as esquires. An Esquire is defined as a man belonging to the high order of gentry ranking immediately below a knight. To represent the crown Esquires or Attorneys were used to handle the legal process of infiltrating the Americas.
These Esquires maintain the position of power thus continuing to control Admiralty Law.
John Adams, Benjamin Franklin and John Jay (Founding father of the USA) were all esquires to the crown. The negotiated the Paris Treaty of Paris 1783 on behalf of the United States. It becomes clearer now how why the treaty seems to align with the British supposedly lost the war of independence. The Paris Treaty of Paris did not give America title to land. The King's possessions in America were protected and governed by corporate charges.
Benjamin Franklin visited France and England many times during the revolutionary war. British just moved from overt control to covert control 13 thirteen colonies.
After the civil war, the United States was financially weakened, low on resources and still struggling to put the country back together America needed money. The international bankers was right there to lend America all that it needed. In February of 1871, Congress cut a debt with the Rothschild bankers in incurring a debt, which allowed the establishment of a new government controlled by foreign money interests under the legislative act of 1871 the United States incorporated as a commercial enterprise to do business for profit. The United States of America changed from a country into a corporation.
What is a corporation? According to a dictionary definition, it is; a company or group of people authorised to act as a single entity (legally a person) and recognized as such in colour of law.
This act of treason changed The Distract of Colombia into a different form of the country with different laws and the different way the United States was run. The USA now incorporated could borrow huge sums of money from the commercial bankers. The debt got so high by 1933 the USA would have to file for bankruptcy. The 50 states are separate from the District of Columbia. The other 50 states are subsidiaries of the District of Columbia. This is why each different state has different laws. Only a King or Queen can rule over a country that’s why The United States has a President, to make decisions on behalf of the King or Queen.
Washington DC operates under the Roman law of lex fori; concerns relations across different legal jurisdictions between persons, and sometimes also companies, corporations, and other legal entities. Which means the District of Columbia is answerable to the Queen of England, who in turn is answerable to the Vatican.