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20 Questions / Front cover / page 1.....................................................Page. 1
Introductory information ...................................................................Page. 2 Table Of Contents..............Links to every page in the book............Page. 3 Read the entire book online -- right here, right now. CLICK ON PAGE 3 ABOVE and click on the various subjects in whatever sequence suits your fancy. You Da Boss! This is a 52-page, INTRODUCTION to our new 220-page book “What YOU, I, the EXPERTS, our GOVERNMENT, the AMERICAN PUBLIC and WIKIPEDIA do not know about our Money and Banking system" . . .it is an amazing story of how the engine, the fulcrum and the heart and soul of capitalism works. |
The Creation Of Money Out Of Thin Air --
A Vital But Almost Unbelievable Part
Of Our Money and Banking System
It is important to be able to show or prove that creating money out of thin air is safe and good. Almost everything on the internet and in books suggest that such actions are harmful in a variety of ways -- for instance, it is said (1) “such money-creation is invariably inflationary” and (2) “such loans create money but not the interest? -- so the loans can never be paid back.”
Does the following deductive (or is it inductive?) argument “prove” to you that “banks can safely and advantageously create money out of thin air?”
If not -- why not? -- where does my argument break down?
INTRODUCTION ...
A) -- Lots of people think creating money out of thin air is always a bad thing -- either (a) having no value or (b) being impossible.
B) -- This article is trying to prove through reasoning that such thoughts [(a) and (b) in (A)] are not valid in any way.
C) -- The article is also trying to show that creating money out of thin air through loans is always advantageous, having no bad effects on the system or the economy.
ASSUMPTIONS and REASONING ...
1) Paper Money is necessary -- because of various unique features which should become apparent after this exercise.
2) Sovereign nations have a right to create money
3) The United States has a right to create money
4) The United States has delegated that money-creating right to the Federal Reserve banking system and to Federal Reserve banks. Essentially the agreement is that the Fed will run the system and make profits doing so -- in return for keeping the money supply and the economy running smoothly
5) The Federal Reserve has an apparent agreement with all of its system banks that the Fed will cover all checks by the local member bank as long as the local member bank is solvent and obeying the rules of the Fed. That ability to write checks that will always be made good is the unique prerogative of those banks that makes each bank a bank.