Yep, the ones who dont agree are idiots and should be silent. Sounds more and more like a religion and Para is the preacher.

Also Para, you seem to be in this personalized bubble I described to you earlier: You are all aware of the fact that when you use google, youtube etc the results get more and more personalized until everything that shows up kinda agrees with you and your opinions until you believe just about anything and it also seems that everyone else agrees with your thoughts too right?

Probably, or at least the powerfull people who came out of those. I mean 300 years is a long time. Once you made all the money in the world from that, ofc. you either cash out or branch out to other stuff... like defence contractors, energy companies like big oil, maybe big pension companies, law firms .. who knows. As they said, they used the money they made from the big crashes, to build big steel industries and other stuff.

But if you focus on the key issues of fractional reserve lending, the private ownership of big central banks and their power over government, maybe we can find some common ground? We are not here to solve the economic problems of the world, but to wake up people to the fucked up system people unknowingly live under imo.

I begin to understand the bad things about centralizing all stuff in europe.. law making, economics.. Too big money, too much power in one place.

hooraytio, then why do you think that the related videos to that video has any relevance at all? Your comments so far has been nothing but idiotic.. i repeat again "this documentary's is bogus, because of the related videos to the right" "also i think he just made it up".

Can someone back me up here? =)

At least come with some sound arguments like Dedi, It sounded like he started to see some light at least, even in my crazed ramblings. Even if he hasn't actually seen the movie yet.

But at least you saw the movie, you made up your mind, blaze also saw it - that's some progress. Then we can talk about the same material instead of say "it's probably just another conspiracy movie", which it is not btw.

confusion...order thru the chaos? all the knowledge in the world are no use to fools. we are riding to utopia, road map says we will be arriving soon!

back in the days i could play quake. and folks could go to bank and trade their 1 dollar bill to fixed amounth of gold, i guess that doesnt work anymore.

and for last, only serious input to the topic, blaze: if its interviews what you seek, "The inside job (2010)"

i wont be taking sides here, as its impossible, i dont understund the whole scenario even a 1% of the big portreit. flow of information is so twisted these days, there will be always someone depating on the value of the info anyone inputs to any of these "conspiracy topics" i dont mean the bank stuff alone. as there are shit loads of more as you all may know.

Where does the genuine info come from anyways, where can we find it and verify it?

Trying to house too many different cultures and/or religions under the same roof has proven to suck so many times so yeah, the EU and other centralizing projects are probably bad ideas. They will collapse in the end. Not just because someone get too powerful and the ppl oppose them, but also because the ppl are too different and will oppose eachother as well.

Yeah I have seen the Inside Job, that is actually the only reason I knew anything about this topic beforehand.

Another great must see video (nothing to do about consipiracy)


Good to watch in bed or something where you can relax and take it in
Not good to watch while surfing and chatting

Ah I can see now the misconception about this. 1000:10000 and 90,9:909 are both 1:10, but of course it's fundamentally different. In the first case the bank would create money out of nothing, in the latter case they only lend from what they got and nothing new is created. So I guess the question is which of these is the actual method in use and can anyone really verify it.

What do you think happened in Ireland?
What do you think happened in Iceland?

And I already gave you a good link to verify it..

But you can go further to http://www.swifteconomics.com/glossary/f/#fractionalreservebankingsystem for more info.

And if you don't care to watch those things, or read it, I can give you the headline. Yes they create money out of thin air, and yes if you put in 1000 kroner they can lend out 9000. But in some cases the 1:10 is not obeyed AT ALL, and they go WAY over that limit.


source: http://ecedweb.unomaha.edu/ve/library/hbcm.pdf

You can simply google fractional reserve lending for 1000's of other links verifying it.

"Welcome to the SwiftEconomics.com Glossary! Each word will come to life using witty jokes, satire, and colorful examples. The glossary is meant to amuse"

Perhaps your source is misinterpreting the concept for entertainment value.


I have. For example from Wikipedia it seems that Dedi's interpration is the correct one, not yours. Just because a 1000 people have been misled by some conspiracy theory to misunderstand a concept, doesn't make their interpration correct.
I think I'll wait for more input before making up my mind about this.

I'm getting tired and Para is giving an overwhelming amount of cases to jump into. It would take hours to go through and I'm not that interested in it. I'd rather conclude my part of this thread with giving my input on the two main issues we have been talking about. Fractional reserve banking and the existence of central banks.

1. Fractional reserve banking does not allow money to be created infinitely as Para seems to think. I will prove it with simple calculation everyone can repeat in their Excel or whatever. Let's consider ratio 1:10. This means that if central bank deposits $1000 into a private bank, money that is real, the quantity has increased by $1000. The bank can lend out 10/11 of this, that is ~$909. Now this money ends up in another bank, they now have $909 and thus can lend $826 and keep $83 in the bank. Then $826 is deposited again, 1:10 ratio for lending, $750 goes out. When you continue this you end up calculating a sum of $1000 * (10/11)^n where n goes from zero to infinity. The sum approaches $10000 and will never go past it. This is how fractional reserve banking works. It is very easy to predict how much new money the private banks can create in regard to central bank open market operations. Or if central bank sells bonds, how much it will shrink money supply. Did you ever even consider that central bank has the tools to decrease the money supply?

2. Now let's dig into central banking. I will use FED because it has been discussed here a lot and I assume it is also studied the most. FED has three tools as I've said before: interest rates, open market operations and fractional reserve ratio. Believe me, the people mr. Obama appoints for Board of Governors do know about these tools. And they use them. If they use $1000 to buy government bonds (=open market operation), they do expect banks to multiply it with the ratio (fractional reserve banking). If the ratio was irrational to them, they would simply change the ratio. They have control! By law Board of Governors are nominated by the President of the United States and confirmed by the U.S. Senate. Not private banks. If there was no central bank, it would still work the same way. Government would still appoint specialists to lead the fiscal policy. Ownership of FED has nothing to do with who is making the decisions, it is not a regular private company.

The private banks who have invested in FED are so called Member Banks. They do not make decisions, they do not handle the income. If you take NY FED for example and look at year 2010, here are the figures that to me are not fucked up:
- Private banks have invested $7682 million in FED. They receive their 6% dividend, which is roughly $460 million. Compare this figure to the amount that is paid out to US Treasury which totals ~$39000 million. It's mere 1.2%. Private banks do not make their profits from FED income.


3. Oh I got to answer one more thing. You suggested countries print more money when in need and then pay it back later. I don't get it, some time ago you were against taxes. Now taxes could be used to cover this. And in the end, this is exactly what is going on. Yes, government pays interest but as you can see from NY FED annual report for example, ~98% of this comes back to US treasury. Yes, if they loan money from China, they lose money to China. Why on earth would you blame the system for action taken by the government it self? If they didn't borrow from China, they would not pay interest to China. Hey, I will help you prove this yourself. Here is the annual report.

End of my fifty cents. I'm not here to heal the world, I don't care enough to try.

Yeah so if the central bank puts $1000 into circulation, the absolute maximum of money that can be created from it is $10 000. A situation where there would be $10 001 is impossible. The only way to get to $10 001, is if the central bank puts 10 cents more into circulation. So the central bank always has an absolute control of the maximum amount of money in circulation.

Also this theoretical maximum can only be achieved if every last cent is sitting in a (virtual) bank vault. If any part of it is borrowed to citizens, the amount in circulation will not achieve this theoretical maximum limit.

I'm wondering now though, if all of those banks expect interest, how can that ever be paid? The absolute maximum amount of money is in circulation, but with that you can only pay back the loan itself, not interest. There simply is no money to pay the interests? Weird.

Yes. In fact the documentary suggests that the owners of the central banks actually use these tools to cause recessions, which allows them to transfer more and more property to the banks. While this sounds like a wild conspiracy theory, even the Wikipedia recognizes that this has happened before. Also the FED is already the third incarnation of a central bank in the US. Both first and the second central banks were disbanded by the president at the time, because they didn't serve public interest. The documentary suggests that the bankers learned from this and finally devised the current form of FED, that looks like it isn't privately owned. It suggests that even the name was carefully chosen to imply that it is run by the government.


http://en.wikipedia.org/wiki/Federal_Reserve_System#Creation_of_First_and_Second_Central_Bank

Yeah it's all there, and the blatant obvious abuse of power the central banks had is most obvious in the past history where they could easier manipulate markets. As blAze pointed out, this is the third installment of central bank where they refined it and hid the purpose of own interest even more by choosing the right name etc.

Now you put me in doubt about this fractional reserve lending as well, but even so, it STILL means they are creating money out of thin air, regardless if it's a factor of 10 or not. 1000$ STILL becomes 10.000$ for the banks. NOTHING HAS CHANGED IN THAT ARGUMENT. It's still as fucked up.

Did you see the Iceland video? 8min, Did you see the Croatia video also around 8min? Those are just teasers for the documentary imo.


Ok I can agree I misrepresented the part about Fractional Reserve Lending, it was not as agressive as I proposed, but still it doesn't stray from the fact they make money out of thin air - and they did it very agressive also by offering loans to anyone that wanted them.

And dedi keep saying the FED don't make any money from it - well the people on the board probably don't make them now, but the private banks who has shares in them most certainly do, because they are part owners of the international banks , that just got bailed out by the billions.

Did you not watch the video yet dedi? plejz.

And dedi, it's really stupid to ONLY look at how current fed operates, if you don't know the history about it. It will give you much wider perspective.

"The first U.S. institution with central banking responsibilities was the First Bank of the United States, chartered by Congress and signed into law by President George Washington on February 25, 1791 at the urging of Alexander Hamilton."

If i recall correctly,about a 10years later hamilton was killed in a pistol duel with some dude of the opposing party or something wouldnt that sound cool eh?

Perhaps one should say that money gets created, when banks loan to each other. A single bank from it's own point of view doesn't really create anything. It receives $1000 and can lend $909 of those forward. The important point is that there is an absolute upper limit dictated by the central bank. In a way money is always created out of air. It gets it's value from the fact that there is a limited amount of it. Because of the upper limit, that holds true for fractional lending as well.

Does it really matter if it's all created out of air by the central bank from the start, or if 10% is created by the central bank and the rest gets created automatically when banks loan to each other? In the end you have an amount of money, that got created out of nothing, and that does not exceed a certain hard limit.

So with that in mind, I would say that from the documentary a bigger problem is giving the money monopoly of a country into private hands, than fractional lending. Perhaps the fractional lending was even misinterpreted in the documentary.

bla bla its all technical details how they create the money, the fact is they do. If they lend to each other, or invest in stupid stuff etc. They have lots of ways to increase the money flow.

And think about this, if they make all these loans out of thin air, all money that gets paid back they can use or scim off the top or invest in own big firms or make deals etc. You can say they do this and that or it's because of that law or this tool. Fact is it HAPPENS and it is LEGAL, and it is proven to fuckup whole countries economies over and over again. It varies with what speed it does it - depends on level of corruption and greed I guess. But most of the involved parties casuing the crashes go scott free.. there are no consequences for the rich, who gamble with taxpayers money in that magnitude. Just look at Ireland or Iceland. This was prophecied many years ago cause it has happened in history before, but in times of booming business, noone gives 2 shits "omg we got CASH $$$". And consequence? rich gets richer with no consequences, and poor get even more poor. Loosing houses/jobs becoming true slaves because they got no options anymore. Public services are cut to the minimum to pay for the fiasco party so public schools/health care will get cut into. The rich people who did the scam don't care, they go live in other countries or send their kids to expensive boarding schools and use private hospitals. With endless money why would they care.

Public have no option, at mercy of government "ok we gotta try to save the ppl, but we all have to make a big sacrifice! are you with us?" fuck no.. oh wait, what alternative we got? Revolution or slavery.
Slavery is good for most, if you can live in comfort, but when the tough gets going, then it's not so comfortable anymore, when they start to take away your basic needs.

Well it was you who has been complaining about fractional reserve. Now it was merely pointed out, that in fact, it doesn't make a difference. Consider these 2 scenarios:

1) Central institution creates all money. Banks can not loan deposits and create money. Let's say the central institution creates $10 000.

2) Fractional reserve lending. Central institution creates $1000. The banks loan it to each other with 1:10 ratio. Finally the money supply equals to it's maximum value: $10 000.

So, after all said and done, we are left with effectively same amount of money in the circulation ($10 000), completely regardless how it was created.

And no, it is not proven anywhere that fractional reserve lending has ruined any country anywhere.

What is proven to some extent is that private monopoly on the creation of money and reckless loans have lead to recessions and depressions.

So I would recommend two improvements:

1) Only government has the power to create and control money supply. Never private parties.
2) Banks should be tightly regulated. They should not be able to outsource the risks in their loans, and they should not be bailed out. Nor should they be let to grow to "too big to fail".

can only be achieved by abolishing fractional reserve lending. So gg to your first comment.

I can agree on your 2nd improvement.

I guess you will never understand the concept. So I give up. ggs.

? the reason they grow that big is because of fractional reserve lending in first place, and the concept of that is creating money out of thin air, which u said government should control, not banks, so what am i missing

interesting analysis of the Masters of Money advocating gold/silver backed money and not FIAT money as proposed in MSM

Btw all this talk about leads me to think bitcoin are the superior currency atm then
It is scarse, you cannot counterfeit it, you cannot create endless ammounts of it and it's been proven 100% safe so far.

It is hardly a technical detail how the money gets created. That you can use the same word - create - for two different things doesn't mean the things and their effects are the same. Never forget that you always think inside of a certain language (Wittgenstein), I think in this case the language is blinding your thoughts.

In your case (100->1000->...) the chain could be endless, from 100$ you could create infinite amount of money. This doesn't happen with FRB (100->190->280->...). Out of 100$ at the best (worst?) case you create 1000$, but it stops there.

Using gold, hmm, lets see. I kindly ask you to lend me 10 pieces of gold, and you do that. I use it for whatever I need, after I'm done I can return it to you. But before I do that, a friend asks me to lend him some fish. I tell him I have no fish left, but I can borrow him 9 pieces of gold, so that he can go and buy it for himself. So we agree and I lend him 9 pieces of gold. *POOF* we "created" gold just as FRB "creates" money (you have 10 pieces, just not available to you right now, my friend has 9 pieces).

(Edit: why? Let's say a scrutiny is started at this point. An officer stops by your door and asks you how much gold you have. You answer 10 pieces, which is true, the gold is owned by you, you just can't use it right now. When he asks me, I answer let's say nothing, and my friend answers 9 pieces, because he can physically show those pieces to the officer. Summary: There are 19 pieces of gold in this village. Rings any bells? Notice how "currency in circulation" remains almost the same for the whole time. Just as there's only 10 pieces of gold in the example.)

Substitute gold with fish and magically also fish can be created. Not only fish, by sharing one woman our group of three desperate guys can "create" two additional women out of one, by using the same lending method

I like the part about creating more women for each man! Or... lets not, its expensive enough with 1 woman per home.

It does not stop there? Because those 1000 has to be paid back WITH INTEREST, that means you have to create new money to pay the debt, so it's a never ending circle of adding more and more money, with more and more accumulated interest and then you get exponential growth in debt+money.


Again, you lend out my gold.. if you can't pay it pack to me, because your fish friend wasted it on hookers, you are accountable for that. Noone is gonna bail you out, I'm probably gonna break your legs. It's not like I can get another 10 gold pieces for free somewhere else.

But that's not how it works for the banking system. They can lend out and if you run with the money, the bank will get bailed out by taxpayer money. So I'm not sure the analogy fits.

Also you haven't created any new gold, you just created debt + illusion of money, since if I ask for my gold back, you cannot give it back. Cause you lend it to someone else. And I can't go to the supermarket and buy stuff and when they ask me to pay I will give them an "i owe you" note from you. They won't accept that, so you didn't create new value, you simply transferred the debt.

But what the bank creates, you can actually go out and buy stuff with.. when they create a bank loan out of thin air, you can spend that money in the real world. And you can go and redeem that money in any bank for REAL money, in your case.. for gold. But the thing is, when too many people want to get their money out, the jig is up, cause ther IS no money, so they have to ask government for permission to print more real money else whole system collapses. So that's when the central banks can create inflation, receseion, depression or financial booms by controlling currency flow at will. And there are many trillions at stake for people involved.

I can honestly say I don't know the perfect sollution, but I can certainly see a big problem. And we can just look around us today to see the consequences and that it cannot be the wise choice to simply do the same mistakes again and again. By printing more EUR money or putting countries to deeper debt by lending them more.

Your last post actually describes the underlying problem that causes the banks to "create" money. Countries/Companies/People want to buy stuff they cant afford.

Also I didn't hear any good comments toward the Icelandic / Croatia videos.

What do you think happened in Ireland?
What do you think happened in Iceland?

This stems from the same concept of fractional reserve lending authority banks have.

And Croatia situation, how a country put itself in debt to foreign banks who now have power over them to push them into EU.

I would say that all you talking about crisis and banking root troubles is only a part of CONCEPTUAL KNOWLEDGE (first typed in Russia in 1990).

That concept was approved by V. Putin in 1996 year and it easy follow with humanity from known oldest history to current days and current troubles, so you can understand it with a different point of view.

I got this concept in 2008 by fortuity, and did my own site. But main work was a huge collection of films (russian mostly) dedicated to that theme - world understanding in social and physical structure.

Unable to get it in good english while, but interested people can read it via google translator http://translate.google.ru/translate?sl=ru&tl=en&js=n&prev=_t&hl=ru&ie=UTF-8&layout=2&eotf=1&u=http%3A%2F%2Fzachem.org%2F_kob.html
Or look a few subtitled videos about "rule the world": http://www.youtube.com/results?search_type=search_playlists&search_query=Lectures+Petrov+%28+Politics%2C+Economics+%29+in+English&uni=1