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Economy
In reply to the discussion: STOCK MARKET WATCH -- Monday, 23 July 2012 [View all]Demeter
(85,373 posts)53. How The Big Banks Run The World -- At Your Expense
http://www.alternet.org/story/156079/how_the_big_banks_run_the_world_--_at_your_expense?page=entire
... "Money" in the real world is a piece of paper (or electronic version of the same) that is a promissory note - a promise to pay you - that legally must be accepted by anyone to whom it is given to settle a debt. Behind this promise is the federal government in two very big ways: First, the government itself stands behind the promise as the party that will pay what it says it will pay on the piece of paper. Second, the government ensures that everyone must accept this promise if the piece of paper is handed over when you buy something or settle a debt...Some "authority" must have the power to issue or authorize the issuing of "promises to pay that must be accepted" - i.e. to "create" money. In the United States that "authority" is called the Federal Reserve ("the Fed" .
And yes - because the economy does, in fact, get bigger over time - the Federal Reserve Board must have a way to create more money (more promises to pay) as time goes on. It does this all the time. In the modern era, it does it via computers issuing - literally out of thin air, via nothing more than accounting entries - promises to pay that are called "dollars." The Federal Reserve uses these to buy up securities owned by banks - and then these newly created "dollars" are deposited in the banks' reserve account at the Fed. Again, yes, created literally out of thin air. (Otherwise the money supply wouldn't expand and we would be back in 1776 ...)
...one estimate is that roughly 25 percent of the world's banking systems allow central banks to extend credit directly to governments; another 37 percent allow short-term advances. These include some of the fast charging so-called "BRIC[S]" countries such as India and South Africa, as well as Malaysia, the United Arab Emirates, Israel and Japan...
... "Money" in the real world is a piece of paper (or electronic version of the same) that is a promissory note - a promise to pay you - that legally must be accepted by anyone to whom it is given to settle a debt. Behind this promise is the federal government in two very big ways: First, the government itself stands behind the promise as the party that will pay what it says it will pay on the piece of paper. Second, the government ensures that everyone must accept this promise if the piece of paper is handed over when you buy something or settle a debt...Some "authority" must have the power to issue or authorize the issuing of "promises to pay that must be accepted" - i.e. to "create" money. In the United States that "authority" is called the Federal Reserve ("the Fed" .
And yes - because the economy does, in fact, get bigger over time - the Federal Reserve Board must have a way to create more money (more promises to pay) as time goes on. It does this all the time. In the modern era, it does it via computers issuing - literally out of thin air, via nothing more than accounting entries - promises to pay that are called "dollars." The Federal Reserve uses these to buy up securities owned by banks - and then these newly created "dollars" are deposited in the banks' reserve account at the Fed. Again, yes, created literally out of thin air. (Otherwise the money supply wouldn't expand and we would be back in 1776 ...)
...one estimate is that roughly 25 percent of the world's banking systems allow central banks to extend credit directly to governments; another 37 percent allow short-term advances. These include some of the fast charging so-called "BRIC[S]" countries such as India and South Africa, as well as Malaysia, the United Arab Emirates, Israel and Japan...
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The whole scam is just so massive. It's just mind boggling how complicit the richest criminals have
mother earth
Jul 2012
#9
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Demeter
Jul 2012
#25
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Demeter
Jul 2012
#50
I know some do not appreciate Taibbi, but who else tells it like it is? Looking forward to "more".
mother earth
Jul 2012
#11
I know, seems like RS & Vanity Fair have stepped up enormously. I love MattT.
mother earth
Jul 2012
#17
Holding Off Armageddon: The Libor Scandal In Full Perspective By Paul Craig Roberts
Demeter
Jul 2012
#8
Exclusive: Prosecutors, regulators close to making Libor arrests (REST THE CASE)
Demeter
Jul 2012
#14
Raining like mad in the markets, too. US Futures looking UG-LEE. Italy down 5%
Roland99
Jul 2012
#40