Some interesting facts and a few shocking figures from America’s central bank and the opinion of Tom Paine and I.
by Jake, the Champion of the Constitution
Originally published Monday, February 23, 2009 at http://www.nolanchart.com/article6036.html
[All figures are taken from the 2008 Annual Report published by the Board of Governors of the Federal Reserve System unless noted.] (emblem)
Wouldn’t it be great to work for a company that “makes money”? This is, of course, exactly what the FED does. The FED, in effect, prints money out of thin air and buys US Treasuries debt obligations from its “primary dealers” companies like Goldman Sachs and JP Morgan Chase as I described in all its enlightening detail here “The Money Matrix – How the FED Works (PART 6/15)“. The Treasuries earn interest which the FED then uses to pay for its operations and salaries. What few probably do not know is that the FED returns this excess interest to the Department of the Treasury after first paying itself and the dividends to the owners of the FED. Pretty convenient little scam I mean payment system – eh?
In 2007, the FED earned $40.3 Billion from its security holdings, but passed $34.6 Billion to the government. The FED spent $3.3 Billion to run itself. (pg 6/40) Taking into account its revenue stream, I estimate the FED paid out roughly $3.9 Billion in dividends which are mandated by the government to be 6%.
We also find that in 2008 the FED paid 4.7 cents to print a $1 bill, and 12.5 cents to print a $100 Federal Reserve Note. (pg 28/40) Pretty good to make a 99.875% gross profit margin on your chief product! That pretty much beats any business I could think up!
The nation’s money supply is soaring. Here are the numbers for the past year, as measured by M2 . . .
* In January of last year the money supply stood at $7.3 trillion
* As of this January the money supply now stands at $8.2 trillion
* This means the Federal Reserve has created nearly $1 trillion new dollars out of thin air, in the space of just one year
The Fed claims they’re doing this to save the economy. They also claim they’ll be able to withdraw this new money as soon as the economic recovers. They’ll do this buy selling various financial instruments they’ve purchased with their funny money. They’ll then retire the dollars they receive in return for these assets, thereby shrinking the money supply before it causes price inflation.
This sounds feasible, but can they really do it? Will the market want to buy what the Fed has to sell? The Fed has purchased huge amounts of distressed assets from the private economy, as well as vast quantities of Treasury notes from the government. Will the market want to buy these “assets?”
The Federal government has sold trillions of dollars of Treasury notes to fund their many bailouts and interventions, and they aren’t done yet. The market is already flooded with government debt instruments, but Congress wants to sell more and more of them to fund additional vast new bailouts. Will investors want to buy more of these government debt instruments when the Federal Reserve decides they need to sell the ones they own? Read More »
Ron Paul in his latest video to supporters criticizes Obama’s mortgage bailout plan, his foreign policy of intervention in Afghanistan, the stock market, and more. Here are a few choice quotes.
“It’s all more of the same. Sadly so.”
“We’re not learning one thing from history.”
“It’s a dead end street to try to militarize Afghanistan.”
“It looks like it’s going to be a quagmire. I see no good coming from this.”
“The sooner we get out of Afghanistan the better.”
The speech covers a fraction of what his book covers, but it gives a great synopsis of the contents of the book. Healy successfully argues the, perhaps obvious case, that the office of the President continues to grow by leaps and bounds unchecked. What many may not want to hear is that Healy also suggests the reason it grows boundlessly is that we the people aren’t demanding that growth stop.
Instead we put faith in our Presidents as saviors of everything from the economy in general to our borders. Now we even seem to expect our President to help pay our mortgages.
If we want to block this growth of power it is up to us to make it stop. The future of our republic is at stake. Watch Healy’s speech below. It is about 20 minutes long (in two parts).
The past couple days have been quite interesting due to a live improvised and impassioned rant by CNBC’s Rick Santelli the other day. His rant represents the near-rage many Americans feel about the Obama administration’s latest plan for wealth redistribution and creating further moral hazard.
The story begins with Rick Santelli’s rant:
Amen Rick. Amen. He may be a loud talker, but he speaks the truth, which these days needs to be shouted for anyone to hear it. After the stir he caused with his rant online CNBC posted a poll asking if you would show up for a Chicago Tea Party in July as he mentions in the rant. Apparently, before the poll was removed 94% said they’d be there with about 250,000 votes.
This morning I heard Rick’s rant played and discussed on Glenn Beck’s radio show, Opie and Anthony’s radio show of all places, and several other main stream media outlets.
Ron Paul’s appearance on HBO’s Real Time with Bill Maher is below.
They discussed free markets, foreign policy, and the drug war in the six minute interview.
The best part of the interview was Paul’s answer on the drug war which garnered the most applause.
Unfortunately, the panel following Ron Paul’s interview (not shown in the clip) was made up of socialist birds of varying degrees. Maxine Waters, one of the first law makers to push for bank nationalization said she liked Ron Paul, but he was a “true believer”.
I suppose having principles and sticking to them is completely foreign to most in government. Given what they are used to hearing that isn’t surprising.
One of the most important efforts we liberty seekers can do is help spread the message to as many minds as possible. On Wednesday Judge Andrew Napolitano broadcasted his new online only television talk show “Freedom Watch” at Foxnews.com. In the first two weeks of the show guests have included Ron Paul, Peter Schiff, Cody Willard, Lew Rockwell, Stephen Moore, and others.
The show is truly a freedom power hour and it was met with great enthusiasm but in order to reach more viewers it should be aired on the regular Fox News Channel. If not that then offering it up for rebroadcasting on local Fox affiliates around the country would be a great step as well.
To that end a Facebook group has been created to demonstrate interest in the show. Perhaps if enough interested people join the Facebook group Fox will consider opening up a time slot for the show, or a rebroadcast of it.
During Ron Paul’s primary campaign in late 2007 I was traveling for a conference wearing my Ron Paul 2008 t-shirt. A man noticed the shirt and struck up a conversation with me by saying, “That guy is real. He’s an Independent, not like the others. I saw him on that show on HBO… uhmm… Bill Maher! He was great!”
The man who spoke to me about Dr. Paul in the airport was not the first nor last person that told me they first learned of Ron Paul by watching him on Maher’s show.
Outside of the Leno, Meet The Press, and Comedy Central appearances his appearance on Real Time was probably the one that gave him the most exposure. This is especially true since it occurred fairly early in his campaign, following the debate where Paul and Giuliani exchanged blows regarding the Iraq war.
Look for video of his appearance here tomorrow after it airs.
Ron Paul was interviewed yesterday on Antiwar Radio with Scott Horton. Horton’s interviews are always interesting and that is especially true when his guest is Ron Paul.
They discuss the escalation of the war in Afghanistan. Obama has promised 17,000 more troops and is expected to ok at least 10,000 more in the coming months. Questions are beginning to be asked… will Afghanistan be Obama’s Iraq, Vietnam, or worse?
As the escalation mounts we will likely see the antiwar left’s support of Obama wane completely if it hasn’t already. This proves yet again that Obama’s foreign policy is no different than Bush’s. Only the locale has changed.
Liberty Maven
[All figures are taken from the 2008 Annual Report published by the Board of Governors of the Federal Reserve System unless noted.] (emblem)
“, delivered an excellent speech at a Ronald Reagan Symposium in Virginia Beach, VA earlier this month. ![Reblog this post [with Zemanta]](http://img.zemanta.com/reblog_e.png?x-id=fb00dd92-ba71-48b8-a11f-528b66a0f9ed)
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