DID YOU KNOW?
Banks create money “out of thin air.”
Empirical studies have been undertaken to prove this thesis and this is the conclusion:
In the 5,000 year history of banking, banks have been thought of as “Deposit Taking Institutions which Lend Money”.
1. What is the legal reality? Banks DON’T TAKE DEPOSITS and DON’T LEND MONEY.
The public is under this false impression on purpose because the language of Banks is not Legal language.
So--what is a “deposit”?
A deposit is not actually a deposit. It’s not a bailment, its not held in custody.
At law, the word “deposit” is meaningless.
If you give your money to the bank (no matter what they call it) it is really a loan to the bank.
Banks borrow money from the public--calling it by the opposite terminology, a “deposit.”
2. Surely Banks LEND money, right? WRONG.
No they don’t. Banks don’t lend money.
Banks, at Law, (it is very clear) are in the business of PURCHASING SECURITIES.
That’s it. That’s all. Here is how they do it.
So, what does a customer do when he wants a LOAN?
A contract, an offer letter (written specifically in the above legal terminology) specifies the customer has “issued a Security”, namely a Promissory Note; and the bank is going to purchase that.
Stop for a moment and get that clear inside your mind.
What almost everybody everywhere THINKS is happening is, in fact, not taking place.
What the Bank is really doing is very different from what it presents itself as doing to the public.
Explain this to a customer and he’ll still say, “Well, how do I get my money? I don’t care about all these legal details--I just want the money.”
The Bank will reply, “You’ll find it in your account with us.”
If the Bank said, “We’ll transfer it to your account”, that’s wrong.
Why? Because no money is transferred. At all. Ever.
3. Neither inside the Bank nor outside the Bank is money ever transferred.
What the Bank calls a “Deposit” is simply (legally) its record of its Debt to the Public.
Now it owes you money and its record of what it owes you is what you THINK you’re getting as money. THAT IS HOW THE BANK CREATES the MONEY SUPPLY.
4. 97% of Bank “deposits” are created out of nothing by the Banks when they “Lend.”
BANKS INVENT FICTITIOUS CUSTOMER DEPOSITS by restating (incorrect in accounting terms) what is an accounts payable liability arising from the “loan contract” (having purchased the customer’s promissory note) as a “customer deposit” BUT NOBODY HAS DEPOSITED ANY MONEY.
Stop and make sure you understand that.
False words=Money supply.
How does the FCA (Financial Conduct Authority) deal with this? You’re not supposed to mislead your customers!
Banks are inventing money by inventing claims (fictitious deposits) misunderstood by the public because of false language.
5. A stable economy is only a result of small Banks using customer’s money to fund other customer’s efforts to create new businesses goods and services.
An unstable economy is the result of LARGE Banks speculating in the Stock Market, creating bubbles, and losing funds which aren’t the property of the Bank in the first place.
6. Banks “creating money” using fictitious accounts for consumption purposes (blind spending without investment) creates a downward spiral and economic crash.
Greater than 70% of LARGE Bank activity is not used creating new goods and services, consequently there are no gains--only losses.
Only by raising prices at large are the losses covered for the time being. This is the origin of inflationary spirals. BANK MALFEASANCE.
When the Banking sector has focused too much on non-productive “lending” the world goes to hell.
If Banks were forced to advertise what they are really doing in clear Legal Terms--the sketchy practices which plague international economies would be exposed.
Where the money is going--as the state of things now exists--is a SECRET and no accountability is possible.
Banks are NOT financial intermediaries at all.
Banks are purely money creators--and even that is because of shady business practices tolerated by political cronyism.
7. IT IS A REGULATION PROBLEM.
In 2009 Dodd-Frank Bank regulation laws were passed in reaction to the crash the previous year with oversight rules which call for strict monitoring.
On March 14, 2018, the US Senate passed a bill by a 67 to 31 vote, easing financial regulations and reducing oversight for banks. The law passed the House of Representatives on May 22, 2018 in a 258–159 vote. The legislation was then signed into law by US President Donald Trump on May 24, 2018.
The Bank Credit for Financial Transaction bubbles were set in motion once again.
It’s a game of musical chairs and hide the salami.
As long as Banks can continue to play this “CREATE MONEY OUT OF NOTHING” charade, the economy appears vigorous. Inevitably, one bankruptcy after another jerks the illusory foundation out from under the matchstick economy and the walls come tumbling down.