I was listening to the news on the radio on our drive back from Mass last Saturday evening. There was a news story about the economy, the National Debt (Capitalized because it is HUGE), interest rates, money supply and Quantitative Easing. Actually, not all of the above stuff was in the story, but the story alluded to all of this if one really paid attention and understood what is happening to our currency in America.

The Muckster was astonished by the misrepresentative, misleading, confusing, ambiguous, disingenuous, deceptive, false and untruthful commentary. So I lost it completely and went into a five-minute rant over a two-minute story. I don’t know if it was a story. I am labeling it a story because it was brilliant science-fiction without the facts.

So what happened next. You guessed it. Lovely Lainey was sitting in the shotgun seat without a shotgun. If she would have had one you would now be reading my obituary. Very calmly, she reminded me that we had just been told the Mass was over and we should “Go in Peace.” She then said, please, just write that down for your next article. Or something like that implying she would rather read about it than listen to another of my rants on how “We the People” are being lied to by the MSM (Main Stream Media) and our political knights in shining armor.

Does the Fed Print Money out of Thin Air?

Folks, The Fed is not printing money out of thin air. Not anymore. They create it on that keypad on the right side of your keyboard. Click, click and hold down that big “0” key on the bottom for a while. Voila, new money goes to the banks. Less purchasing power for “We the People.”

A central bank was created by Congress on December 23, 1913. A day that will really live in infamy, once we all learn how that act sold us down the river. That central bank was called the Federal Reserve System. They made up that name to disguise what it really was. Grand theft.

In 20/20: A Clear Vision for America I laid out the entire fraud for all to read. I explained how we will not be able to continue to pay a large portion of our revenues to service the interest on the National Debt. Don’t you like the way the politicians refer to paying interest on the pork they bought. Service the debt. Sounds like something we did to a mare I had when I was a teenager.

A method/trick to bring down interest rates that are close to zero, or almost zero. The most criminal step in QE is that the central bank creates new money for use in the economy. This is done because interest rates cannot be cut below zero. When rates near zero the effect they have on regulating the economy becomes subdued.

Banks still need to make a profit and in troubled times the banks will increase the gap between the official interest rate and the rates faced by companies and households, because lenders want a greater return for the additional risk of granting a loan in tough times. That is called greed.

Central banks normally set the price of money using official interest rates to regulate the economy. These interest rates radiate out to the rest of the economy. They affect the cost of loans paid by companies, the cost of mortgages for households and the return on saving money. Higher interest rates make borrowing less attractive because taking out a loan becomes more expensive.

So when interest rates are close to zero, they pull their magic trick out of the bag to affect the price of money: Quantitative Easing (QE). Only a central bank can do this because its money is accepted as payment by everybody. A central bank simply creates new money at the stroke of a computer key, in effect increasing the credit in its own bank account.

 QE (Quantitative Easing or How to Pick Your Pocket without You Knowing It)

A method/trick to bring down interest rates that are close to zero, or almost zero is the process in QE whereby the central bank creates new money for use in the economy. This is done because interest rates cannot be cut below zero. When rates near zero, the effect they have on regulating the economy decreases.

Banks still want to make big profits and in troubled times the gap between the official interest rate and the rates faced by companies and households can rise, because lenders want a greater return for the additional risk of granting a loan.

Central banks normally set the price of money using official interest rates to regulate the economy. These interest rates radiate out to the rest of the economy. They affect the cost of loans paid by companies, the cost of mortgages for households and the return on saving money. Higher interest rates make borrowing less attractive because taking out a loan becomes more expensive.

So when interest rates are close to zero, they pull their magic trick out of the bag to affect the price of money: Quantitative Easing (QE). Only a central bank can do this because its money is accepted as payment by everybody. A central bank simply creates new money at the stroke of a computer key, in effect increasing the credit in its own bank account. This is how they create recessions and rebounds. Another felonious act of self-indulgence.

It then uses all of this “newfangled” money to buy whatever assets it likes: government bonds, equities, houses, corporate bonds or other assets from banks. With the central bank weighing in, the price of the assets it buys rises and the yield, or interest rate, on that asset falls. Companies, with a willing central bank wanting to buy its bond, will be able to pay a lower interest rate when new bonds are issued, or when existing bonds come to the end of their life and need to be replaced.

With cheaper borrowing the hope is that the central bank will again encourage greater spending, putting additional demand into the economy and pulling it out of recession. As the money ends up in bank deposits, banks then stumble upon their funding position improved which causes them to want to lend.

A side effect of this new money is increased consumer prices. The result: “We the People” make less and pay more. And now you know why that shiny silver dollar only buys 3 tarnished pennies worth of consumer goods in 2016 as opposed to 100 shiny copper pennies worth of purchases in 1913.

Okay, you say. We need more money today because things cost more. We have to pay workers more money so everything must cost more. This is not a valid argument when you consider real inflation has gone from about 7 percent in 1913 to 250 percent in 2016 but wages have only increased about 20 times in the last 100 years. Another factor is American workers are much more productive today that they were in 1913. Prices should go down, not up.

Things do not cost more. Money costs more. That is how the banks steal our wealth to increase their wealth.