"As of now, the world financial system is on the brink of collapse due to it's own shortcomings. The controller of currencies stated in 2003 that the interest on the US national debt will not be affordable in less than ten years.
This theoretically means total bankruptcy for the US economy and it's implications for the world are immense."
Zeitgeist: Addendum.
Blue is the Federal Reserve
Wikipedia..... For the only way to keep the banks going is by making more money. The only way to make more money is to create more debt and inflation
. It is simply a matter of time before the tables turn and no one is willing to make new loans while defaults grow as people are unable to afford their current loans. Then the expansion of money will stop and contraction will begin on a scale never before seen. Ending a century long pyramid scheme. This has already begun"Zeitgeist: Addendum.
Wikipedia - United States Debt
As of February 28, 2011, the Total Public Debt Outstanding of the United States of America was $14.19 trillion and was 96.8% of calendar year 2010's annual gross domestic product (GDP) of $14.66 trillion. Using 2010 figures, the total debt (96.3% of GDP) ranked 12th highest against other nations.
and from www.treasurydirect.gov
| Interest Expense Fiscal Year 2011 | |
|---|---|
| February | $21,759,253,957.26 |
| January | $21,122,729,715.18 |
| December | $104,700,174,845.03 |
| November | $19,396,316,137.56 |
| October | $24,142,491,931.22 |
| Fiscal Year Total | $191,120,966,586.25 |
| Available Historical Data Fiscal Year End | ||||
|---|---|---|---|---|
| 2010 | $413,954,825,362.17 | |||
| 2009 | $383,071,060,815.42 | |||
| 2008 | $451,154,049,950.63 | ... | ||
Wikipedia - Money Creation
In economics, money creation is the process by which the money supply of a country is expanded. There are two principal stages of money creation. First, the central bank of a country can introduce or issue new money into the economy (termed 'expansionary monetary policy'). A central bank usually injects new money into the economy by purchasing financial assets. Second, the new money introduced by the central bank is multiplied by commercial banks through fractional reserve banking, expanding the amount of broad money (i.e. cash plus demand deposits) in the economy.
Wikipedia - Treasury Security
A United States Treasury security is government debt issued by the United States Department of the Treasury through the Bureau of the Public Debt. Treasury securities are the debt financing instruments of the United States Federal government, and they are often referred to simply as Treasuries.There are four types of marketable treasury securities: Treasury bills, Treasury notes, Treasury bonds, and Treasury Inflation Protected Securities (TIPS). There are several types of non-marketable treasury securities including State and Local Government Series (SLGS), Government Account Series debt issued to government-managed trust funds, and savings bonds.
Wikipedia - Government Bond
"A bond is a debt investment in which an investor loans a certain amount of money, for a certain amount of time, with a certain interest rate, to a company or country"
The US government borrows money by selling Securities. The Federal reserve buys US Government Securities.
Fractional-reserve banking is the banking practice in which only a fraction of a bank's deposits are kept as reserves (cash and other highly liquid assets) available for withdrawal.[1][2][3][4] The bank lends out some or most of the deposited funds, while still allowing all deposits to be withdrawn upon demand. Fractional reserve banking is practiced by all modern commercial banks.
When cash is deposited with a bank, only a fraction is retained as reserves, and the remainder can be loaned out (or spent by the bank to buy securities). The money lent or spent in this way is subsequently deposited with another bank and increases the cash reserves of that second bank, allowing that second bank to keep a fraction of the new deposit and lend or spend the remainder. Thus the excess cash travels from bank to bank to bank creating new deposits as it goes. Although no individual bank does anything other than lend part of what is deposited with it, the practice of fractional reserve banking in a multi-bank system expands the money supply (cash and demand deposits) to a large multiple of the cash reserves in all banks.[5]
The nature of modern banking is such that the cash reserves at the bank available to repay demand deposits need only be a fraction of the demand deposits owed to depositors. In most legal systems, a demand deposit at a bank (e.g. a checking or savings account) is considered a loan to the bank (instead of a bailment) repayable on demand, that the bank can use to finance its investments in loans and interest bearing securities. Banks make a profit based on the difference between the interest they charge on the loans they make, and the interest they pay to their depositors. Since a bank lends out most of the money deposited, keeping only a fraction of the total as reserves, it necessarily has less money than the account balances of its depositors.
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