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Alternative banking systems? (76 posts)

  1. Diane
    Member

    In the thread on Christian theocratic movements, emanuel wrote:

    It is interesting to me that the Sentinel Group advocates the setting up of an alternative banking system, something Catherine also advocates. Thing is, don't we all advocate that? I mean nobody likes the current one, right?

    I would be interested in your thoughts (and the thoughts of other people here) on what kind of alternative banking system you would like to see, and how it would work. What are your specific criticisms of the current banking system, and how would you want to see those problems fixed?

    The Alex Jones / We Are Change wing of the 9/11 Truth movement has spread quite a bit of nonsense about the banking system, e.g. about the Federal Reserve. It would be desirable to develop a more fact-based critique -- and, if possible, a more realistic vision for change.

    Posted 15 years ago #
  2. Diane
    Member

    I just now came across an article about Catherine Austin Fitts, libertarian, a critique of Fitts's economic ideas from a left-wing perspective, on the questionsquestions.net blog.

    Posted 15 years ago #
  3. emanuel
    Member

    I would be interested in your thoughts (and the thoughts of other people here) on what kind of alternative banking system you would like to see, and how it would work. What are your specific criticisms of the current banking system, and how would you want to see those problems fixed?

    Zikes! That's a huge question. But I do have an answer. Here it is:

    http://video.google.com/videoplay?docid=-905047436...

    This is a 40-minute animated video about the current banking system, the history of money, and the only alternative that could possibly work. The alternative is very simple. It's an interest-free, government issued currency, the amount of which released into the economy matched to the amount of wealth being created via renewable resources. This is opposed, of course, to the current system predicated on endless growth, where money is released into the economy as debt, and works (for the bankers and wealthy investors mostly) only in-so-far as oil allows ever increasing amounts of wealth (i.e., "development" that is destroying the planet) to be created each year.

    Really, I can't recommend this video enough. You should forward it to everyone you know. I have it on my signature file of my email account, and it thus goes out to everyone I email.

    Emanuel

    Posted 15 years ago #
  4. Diane
    Member

    I have dial-up, hence can't watch online video. Are there any written sources you can recommend?

    On technical matters like economics, I'd much rather look at a written source than a video anyway. But what is the name of the video you recommended (just in case I might happen to have it around here on DVD)?

    Posted 15 years ago #
  5. emanuel
    Member

    Literally there is no educational piece better than this video, written or otherwise, in explaining the current financial crisis and the larger picture of money and banking. You really have to go over to a friend's house and watch it. It's only 40 minutes long.

    Emanuel

    Posted 15 years ago #
  6. Diane
    Member

    I am not going to pester my friends to let me borrow their computer. I do not watch online videos, period, end of story.

    For the second time, could you please tell me the TITLE of this video, and who made it? Perhaps I might be able to get it on DVD at some point?

    Posted 15 years ago #
  7. chrisc
    Member

    could you please tell me the TITLE of this video

    If you click the link from Emanuel the page you can watch it on displays the title, the official site for the flim is here (mostly flash only):

    http://www.moneyasdebt.net/

    But there is a HTML listing of references which will give you an idea about where the film is coming from (I haven't got around to watching it yet):

    http://paulgrignon.netfirms.com/MoneyasDebt/refere...

    It's also available via bittorrent:

    Posted 15 years ago #
  8. chrisc
    Member

    What would potentially be interesting would be a synthesis of the "money as debt" type understanding of capitalism and the Marx's labour theory of value -- both seem to be missing parts of the overall picture?

    http://en.wikipedia.org/wiki/Labour_theory_of_valu...

    Posted 15 years ago #
  9. chrisc
    Member

    Paul Grignon, the guy behind Money as Debt, has an old page on 9/11 here:

    http://www.paulgrignon.netfirms.com/Lifeboat_News/...

    and also some stuff here:

    http://www.paulgrignon.netfirms.com/Lifeboat_News/...

    Which on a quick scan is probably more-or-less OK, though the page above does promote Dave von Kleist's 911 In Plane Site... but it does look like a page that hasn't been updated for years...

    Posted 15 years ago #
  10. chrisc
    Member

    Paul Grignon also made a video in 2000 about "chemtrails" with Will Thomas, "Chemtrails - Mystery Lines in the Sky" 28 min -- see the bottom of this page, here:

    http://www.paulgrignon.netfirms.com/MoonfireStudio...

    It's on Google video, I haven't watched it:

    http://video.google.com/googleplayer.swf?docId=784...

    Posted 15 years ago #
  11. chrisc
    Member

    So I watched some of and listened to most (I missed some bits where there was scrolling text and no voice over) of Money as Debt and what made me somewhat uneasy about it was that it could, rather easily, be used to support a "blame the (Jewish) bankers" analysis of the current crisis of Empire -- in the film the banker is called Goldsmith, he starts off as a goldsmith...

    Posted 15 years ago #
  12. chrisc
    Member

    This film appears to be popular with people we wouldn't want to be associated with...

    google.com/search?q=site:www.stormfront.org+"money+as+debt"

    I haven't read the threads on that site, but the fact that there are 1,100 hits is kinda disturbing...

    Posted 15 years ago #
  13. truthmover
    Administrator

    In my opinion, the first section of "Zeitgeist: Addendum" deals with the monetary system in more responsible manner than "Money as Dept." Addendum over-reaches a bit here and there, but doesn't have any racist overtones.

    Posted 15 years ago #
  14. Diane
    Member

    I haven't seen "Addendum," but the original Zeitgeist certainly did NOT deal with monetary issues in a responsible manner. It used the same nonsense that a lot of pop monetary critiques have lifted from the writings of Eustace Mullins (a fierce Jew-hater who also advocated the blood libel).

    For example, it claimed that the Fed is nothing but a private banking cartel, "as Federal as Federal express," and it claimed that the Federal Reserve Banks are profit-making entities whose profits go into the pockets of member banks.

    In fact, the vast majority of the Fed's "profits" are returned to the U.S. Treasury. The private member banks do earn a dividend on the portion of their reserves that they are required to keep at their local Federal Reserve Bank, but that dividend is only 2 to 3 per cent of the Fed's total profits.

    See the long discussion about banking systems starting on page 3 of the Truth Action thread We Are Change - September threads on right wing views. See also the Federal Reserve System's income and expense tables for 2005 and 2006.

    Posted 15 years ago #
  15. truthmover
    Administrator

    Most here agree that Zeitgeist was crap. The new movie is entirely different in content, approach, and tone. Although, as with the first, I think each of the sections have different merits.

    I recommend having a look at the Wikipedia entry:

    http://en.wikipedia.org/wiki/Zeitgeist_addendum

    Posted 15 years ago #
  16. chrisc
    Member

    It's not just the Federal Reserve that is the problem, other states also have national banks, eg The Bank of England and there are of course the commercial banks and the global organisations, like the BIS, the IMF and World Bank, but Money as Debt and Zeitgeist: Addendum go much further than wanting to see a reform of the Federal Reserve -- they are basically saying that the whole monetary system needs to be recreated from scratch as a sustainable system, I think... Personally I'd rather see a system based on production for need, abundance of basic necessities and no money at all...

    Posted 15 years ago #
  17. chrisc
    Member

    See also the Truth Action thread on Zeitgeist: Addendum: http://truthaction.org/forum/viewtopic.php?t=4412

    Posted 15 years ago #
  18. emanuel
    Member

    Wow. I've been away for a few days. Nice to see so many posts in this thread. I have some comments.

    First, sorry Diane for not including the name of the video in my response to you, and for any offense you may have felt in reiterating my recommendation that you watch the video online. I am not sure if you can get a DVD copy.

    Chris, that's disappointing to hear the producer of Money as Debt made a video on chemtrails (since chemtrails really are just persistent contrails). Too bad so many people get caught up in that one.

    As for anti-semitism or "racist overtones" in the video, I do not see that anywhere. In fact, one thing I like so much about Money as Debt is how it clearly takes care not to include any of those stereotypical depictions of "Jewish Bankers." The international banking cartel, of course, is comprised of people from many ethnicities and religions. It's not a Jewish conspiracy. What the video suggests is that this cartel grew out of the wealthy, aristocratic, capitalist families of Europe, like the Rothchilds, for example. I believe this is true. It makes no reference to race anywhere.

    It really is unfortunate how discussions of the the FED, the international Banking Cartel, etc., have come to be associated with anti-semitism and the "right wing" in general. I believe much of this is intentional disruption. Anti-semitism is a favorite label provocateurs pin onto activists. We have all seen this in the 9/11 truth movement, and I have seen first-hand how they use this race baiting to divide the anti-war movement. Nothing is more repugnant than to be associated with racists and anti-semitism. Hence it is an effective disruption tactic. But we shouldn't disassociate with everyone (or every video) who exposes the banking conspiracy because we fear being falsely labeled a racist. And this is true even though there really are a lot of racists who understand there is a banking conspiracy. There are a lot of racists who know 9/11 was an inside job too, and who link their websites to the good 9/11 websites. Are we to stop associating with the good 9/11 truth activists as well? Now I will admit I haven't researched Paul Grignon, but just because a bunch of right wing racists like his video does not mean the video has racist overtones, or that Grignon himself is racist. Judging from the video, I would guess he is not, because I don't see anything racist in the video.

    The monetary system of debt/credit/interest is so important for the left to understand and work to change. As Mike Ruppert always says, "we will change nothing until we change the way money works." I believe much of the anti-semitism associated with critiques of the international banking cartel is purposefully injected into the information streams in order to dissuade the left from going there. (Remember the early claim that thousands of Jews who worked in the World Trade Center did not show up on the morning of 9/11? This was a similar ploy to dissuade the Left from getting involved in 9/11 research and activism.)

    Lastly, Diane, thank you for posting the link to page three of that truthaction forum thread. I enjoyed reading the debate. I must say, though, that I do not agree with Patrick S. McNally's take on the matter. His defense of the federal reserve appears to me to be a bunch of straw man arguments. The notion of "rebates" to the National Treasury makes no sense when the US Treasury borrows from the FED (which creates the money), not vice versa. And his claim that the national debt is the result of a "spending spree" rather than the fact that the US government has to borrow money from the FED, sounds very conservative, and is clearly disingenuous. It's like saying that my student loan debt is the result of my spending money on my schooling, rather than the fact that I had to borrow in order to attend. The US government used to create it's own money. (A college education used to be free.) The US government gave the power to create money to the FED, and now they have to borrow it. (The State of California stopped funding the UC System, and now students have to borrow to pay for their education). The national debt thus has nothing to do with how much the government spends. It has to do with how the system is set up, requiring all new money entering the economy to be issued as debt, such that even the US government has to borrow it.

    As for the FED being private, this is irrefutable, even if the President gets to appoint the figurehead. McNally's talk of the stock market is all red herring. The FED is not a "publicly" traded private company. It is a private-private company. There are wealthy, principal investors (i.e., owners) of the largest banks that comprise the FED. They loan money (they create it out of thin air) to lesser banks, with interest. These banks loan it to businesses and consumers, with greater interest. When the lesser banks pay back the FED, they most certainly make profits, much of which goes to the principal investors.

    Again, this is an issue that many people identified as "right wing" are concerned about. The left ought to be concerned about it too. It really has nothing to do with left-wing or right-wing politics. We should not throw the baby out with the bathwater just because there are right-wingers who care about the issue. The baby, in this case, is far too important.

    Emanuel

    Posted 15 years ago #
  19. chrisc
    Member

    Emanuel, thanks for the substantive reply.

    Posted 15 years ago #
  20. Diane
    Member

    Emanuel wrote:

    The notion of "rebates" to the National Treasury makes no sense when the US Treasury borrows from the FED (which creates the money), not vice versa.

    However, what happens to the interest that the Fed gets from loaning money to the US Treasury? Most of that interest gets returned to the US Treasury. (See the two Fed financial reports I linked to in my earlier post.) That's what is meant by the "rebates." Only about 2.5% of the interest goes to the member banks, in the form of dividends on the reserves that they're required to keep at their local Federal Reserve Bank. One can argue that even that 2.5% is too much, but it's miniscule compared to the size of the national debt.

    Posted 15 years ago #
  21. Diane
    Member

    Emanuel wrote:

    As for the FED being private, this is irrefutable, even if the President gets to appoint the figurehead. McNally's talk of the stock market is all red herring. The FED is not a "publicly" traded private company. It is a private-private company.

    Private companies don't turn over 85 to 90 percent of their interest income to the U.S. Treasury. And the President appoints more than just a "figurehead." The Fed has a Board of Governors who are appointed by the President and confirmed by the Senate. And the chairman is no mere "figurehead" - he has lots of power.

    Again, this is an issue that many people identified as "right wing" are concerned about. The left ought to be concerned about it too. It really has nothing to do with left-wing or right-wing politics. We should not throw the baby out with the bathwater just because there are right-wingers who care about the issue. The baby, in this case, is far too important.

    True. However, we should be careful to avoid repeating false claims that have been popularized by Jew-haters and other extreme right wingers. When we repeat false claims that have been popularized by Jew-haters and other extreme right wingers, we thereby do make ourselves look like extreme right wingers, even when the claims themselves are not overtly racist.

    Assuming that what you've said about the Federal Reserve System, above, is an accurate reflection of ideas contained in the video Money Is Debt, it appears that Money Is Debt is indeed repeating the same old Eustace Mullins nonsense. No wonder the neo-Nazis are so fond of it.

    On the other hand, there have been plenty of left-wing critiques of the IMF and the World Bank which do not repeat such canards. I would suggest that we try to dig up some of these old left-wing critiques, instead of repeating right wing nonsense.

    Posted 15 years ago #
  22. mark
    Member

    Here's a much better link on the history of money, although I can't vouch for everything there ...

    http://www.themoneyfix.org

    If you combine the links and experts promoted there with the peak oil / peak money paradigm of M. King Hubbert and the Peak Oil experts, that would be a fairly comprehensive understanding.

    see

    http://www.mkinghubbert.com Hubbert's writings

    http://www.postcarbon.org Post Carbon Institute: Heinberg, Darley, etc.

    http://www.dieoff.org economics at the end of oil

    http://mikeruppert.blogspot.com

    http://www.oilempire.us/peak-money.html several links on sustainable economics and the limits to endless growth on a finite planet

    Posted 15 years ago #
  23. emanuel
    Member

    Hi Diane (and others of course),

    To respond to your comments... First, the Money as Debt video is not about the Federal Reserve specifically. It is about the history of money and how money is created in general. The FED is barely mentioned.

    Next, you say:

    Private companies don't turn over 85 to 90 percent of their interest income to the U.S. Treasury.

    And neither does the FED. What you are referring to is only the interest from the "member banks" reserve deposits. The FED is comprised of 12 "reserve banks." Then all other banks (if they want to receive loans from the FED, that is, which essentially means all major banks in the US) are called "member banks." Member banks are required to have reserves or "initial deposits" in the Reserve Banks (in the FED). It is only the interest/profits of these initial deposits that you are talking about. This is petty compared to the interest made on the NEW MONEY (created out of thin air) by the reserve banks themselves, loaned to the member banks. So, for example, if you and I wanted to start a bank, we would fill out an application for the FED, send it in with our initial deposit money. We are now a "member bank". We are not allowed to earn interest on this money. But then, the FED (i.e., the 12 "reserve banks"), starts loaning us money they create out of thin air... WAY MORE money than our initial deposit or "reserves." We pay interest to the FED on this money, which does NOT go to the Treasury. We profit not from our initial deposits, which were minor, but rather from re-loaning the new money the FED loaned us to companies and consumers. Our profit is the differential in interest rates between what we charge our debtors and what the FED charges us.

    The system only works (meaning makes us and the 12 Federal reserve banks profit) when the companies and consumers we lend the money to are out there working and making real money in the "real economy" (distinguished from the "financial economy"). This can only happen when the overall real economy is growing, which is dependent on cheap and plentiful oil. It's a system based on the myth of perpetual growth on a finite planet, and it institutionalizes the destruction of the planet. This is what the video is about (really, you should watch it). It explains this in a very clear manner, as well as the long and general history of how this system developed. (Again, it doesn't talk about the FED issues we are discussing here).

    True. However, we should be careful to avoid repeating false claims that have been popularized by Jew-haters and other extreme right wingers. When we repeat false claims that have been popularized by Jew-haters and other extreme right wingers, we thereby do make ourselves look like extreme right wingers, even when the claims themselves are not overtly racist.

    Of course! But what false claims are you referring to? There are no false claims (as far as I know) in the Money as Debt video. And there are certainly no false, racist claims. Also, it is wrong to imply that the basic (and correct) critique of the perpetual-growth-based financial system, and even the basic (and correct) critique of the FED, "have been popularized by Jew-haters." This is not true. These critiques have been popularized by intelligent, concerned, non-racist activists. For the most part, it is not us who are repeating their claims. It is them who are repeating our claims. This is true even with regards to 9/11. More damaging than the nonsense claims put out there by anti-semitic groups, are the accurate ones. It tarnishes by association.

    So... if there are false claims none of us want to repeat them. This would be true regardless of who originally made the claim.

    Assuming that what you've said about the Federal Reserve System, above, is an accurate reflection of ideas contained in the video Money Is Debt, it appears that Money Is Debt is indeed repeating the same old Eustace Mullins nonsense.

    Again, the video is not about the FED at all. It is about a perpetual-growth based financial system that destroys the planet imposed on the world by the financiers of capitalism (i.e., the international banking cartel). You will be happy to know it even mentions the IMF and World Bank.

    And the President appoints more than just a "figurehead." The Fed has a Board of Governors who are appointed by the President and confirmed by the Senate. And the chairman is no mere "figurehead" - he has lots of power.

    And what power is that? To adjust the interest rates to member banks? It is the structure and role of FED that matters, not who is at the top. In other words, the FED is not like the EPA, where the appointed head can go in and kick butt and change things around for the good if she/he wants to. The FED serves the interests of 12 private banks. It is officially called a "quasi-public" entity, but this is a euphemism. In any practical sense it is private. It took over the responsibility of creating money from the US Government, and now loans the US Government money, effectively reducing the US government to a subserviant debtor. I can elect the board members of my credit union too if I wanted to, but I am under no illusion that that makes them accountable to my interests. The President and the senate are corrupt. The system is corrupt. Call it "quasi-public" if you want, but it doesn't change the fact that the capitalist financiers hijacked the financial system of the United States... slowly over it's history, and completely in 1913.

    Emanuel

    Posted 15 years ago #
  24. Diane
    Member

    I wrote earlier:

    Private companies don't turn over 85 to 90 percent of their interest income to the U.S. Treasury.

    I misspoke here. Instead of "interest income" I should have said "total net income." The relevant lines from the Fed's 2005 financial statement are:

    Net income before payment to U.S. Treasury 23,520,080

    Dividends paid 780,863

    Payments to U.S. Treasury (interest on Federal Reserve notes) 21,467,545

    Transferred to/from surplus 1,271,672

    And the relevant lines from the Fed's 2006 financial statement are:

    Net income before payment to U.S. Treasury 34,194,762

    Dividends paid 871,255

    Payments to U.S. Treasury (interest on Federal Reserve notes) 29,051,678

    Transferred to/from surplus 4,271,828

    Here, the "dividends paid" are apparently the dividends paid to member banks, on the money that the member banks are required to keep at their local Federal Reserve Bank. Notice how small that figure is compared to the "payments to U.S. Treasury."

    Posted 15 years ago #
  25. Diane
    Member

    emanuel wrote:

    To respond to your comments... First, the Money as Debt video is not about the Federal Reserve specifically. It is about the history of money and how money is created in general.

    Here is a brief history of money systems from a mainstream liberal point of view: Myth: The gold standard is a better monetary system. Fact: The gold standard causes deflation and depressions. . Despite its title, this article is about more than just the gold standard; it contains a brief history of money systems in general. I would be interested in your comments on it. Does it agree with your understanding of the history of money? If not, what are your points of disagreement?

    Perhaps Nicholas, or someone else here, can refer us to a good history of money from a Marxist point of view? (and preferably an online written source, not a video?)

    emanuel wrote:

    What you are referring to is only the interest from the "member banks" reserve deposits.

    See my previous post for my response to our misunderstanding on this point.

    So, for example, if you and I wanted to start a bank, we would fill out an application for the FED, send it in with our initial deposit money. We are now a "member bank". We are not allowed to earn interest on this money. But then, the FED (i.e., the 12 "reserve banks"), starts loaning us money they create out of thin air... WAY MORE money than our initial deposit or "reserves." We pay interest to the FED on this money, which does NOT go to the Treasury.

    Judging by the Fed's financial statements, it would seem that a significant part of it does go to the Treasury.

    We profit not from our initial deposits, which were minor, but rather from re-loaning the new money the FED loaned us to companies and consumers. Our profit is the differential in interest rates between what we charge our debtors and what the FED charges us.

    That is indeed correct, I think.

    The system only works (meaning makes us and the 12 Federal reserve banks profit) when the companies and consumers we lend the money to are out there working and making real money in the "real economy" (distinguished from the "financial economy"). This can only happen when the overall real economy is growing, which is dependent on cheap and plentiful oil. It's a system based on the myth of perpetual growth on a finite planet, and it institutionalizes the destruction of the planet.

    Yep, that is indeed a fundamental problem.

    But what false claims are you referring to?

    The claim (which I thought you were making -- perhaps I misunderstood you?) that the Fed is a profit-making enterprise from whose profits go directly into the pockets of member banks. Also the claim that the Fed is a "private" profit-making enterprise.

    Also, it is wrong to imply that the basic (and correct) critique of the perpetual-growth-based financial system, and even the basic (and correct) critique of the FED, "have been popularized by Jew-haters." This is not true. These critiques have been popularized by intelligent, concerned, non-racist activists. For the most part, it is not us who are repeating their claims. It is them who are repeating our claims.

    I agree with you regarding the basic critique of a growth-based economy. But that's different from the claim that the Fed is a private profit-making enterprise whose profits go into the pockets of member banks.

    In any practical sense it is private. It took over the responsibility of creating money from the US Government, and now loans the US Government money, effectively reducing the US government to a subserviant debtor.

    Well, sort of. As already noted, most of the interest on said loans to the Treasury gets returned to the Treasury.

    Regarding the power of the Fed chairman:

    And what power is that? To adjust the interest rates to member banks?

    To stabilize the money supply, which benefits almost everyone, not just the banks -- albeit within the context of the current growth-based system, with its inherent larger problems.

    Call it "quasi-public" if you want, but it doesn't change the fact that the capitalist financiers hijacked the financial system of the United States... slowly over it's history, and completely in 1913.

    The "capitalist financiers," along with other wealthy folks, have always been on top in the U.S. economy; they didn't "hijack" a previously pristine system. What happened in 1913 was simply a banker-approved variant of the monetary reforms that many other people had been calling for as well, to smooth out the business cycle and eliminate the frequent depressions that had been plaguing the economy on a regular basis.

    And indeed the Federal Reserve system has been largely (though not completely) successful in its mission to stabilize the economy, once the people running it finally got the hang of it during World War II. Since then, we've had plenty of recessions, but no full-fledged Great Depression since the 1930's, whereas crises like the Great Depression had previously been commonplace. If anything, it has perhaps been too successful, insulating us against longterm dangers.

    Posted 15 years ago #

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