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Understanding Fiat Money

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Because of the interest in the thread "On the Cusp" (about gold and silver and fiat money) I have decided, following the request of some via emails, to set up a new thread dedicated to explaining just what fiat money is and who controls it. When you put aside half an hour and watch these Youtube videos linked below you will see why our monetary system is so corrupt and why the big banks (like Bank of America, J P Morgan and Goldman Sachs) are "too big to fail". It is J P Morgan in particular that has been manipulating gold and silver prices by shorting them with "paper trades". If you watch these videos you will understand why.

 

This could be the most important thirty minutes you have spent in a long, long time and will give you a very good insight into how flawed fiat money (the cash in your bank account) is and why the system is "off the rails".

 

I would encourage others to add their video clip links and comments on this subject to this thread....

 

1) What is fiat money .. excellent easy to understand 10 minute video: YouTube - Money As Debt - How our Banking system works.

(Fiat money as no real value - that's why you can just print more of it)

 

2) Two minute video on who owns the Federal Reserve Bank, IMF and World Bank:

(A private cartel of major US banks... who created the fiat system.)

 

3) Five minute video exposing the secretive Federal Reserve Bank:

(The financial system is unconstitutional)

 

4) Seven minute BBC video on the corrupt agenda of the World Bank and IMF and its four stages of manipulating states:

Includes a comment on Drug companies who for years prevented people in South Africa suffering from aids getting drugs... operating under World Bank WTO rules... people just died and they did not care.

 

5) Seven minute video on the move by the big banks towards a global currency: YouTube - The move towards a global currency

(Scary)

 

6) Three minute video - So who owns South Africa? :

(Demonstrates how gold is being literally stolen from South Africa by the big banks through the fiat system)

 

In short, the global economy - including South Africa - is run by Wall Street bankers who have no interest in your welfare. Inflation is used as a form of private taxation that continually devalues your wealth and puts it in the hands of the ultra rich banking families.

 

In these videos is the disturbing comparison of Tanzania with 25 million people and a GDP of just US$2.2 billion and Goldman Sachs sharing annual profits of US$2.2 billion among just 160 wealthy shareholders.

 

Kind regards

 

Scott Balson

Edited by ndoa18

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Mike Klee

Hi Scott,

"6) Three minute video - So who owns South Africa? :

(Demonstrates how gold is being literally stolen from South Africa by the big banks through the fiat system)"

Iwatched the above YouTube video and find fatal flaws with it. Just two off-hand:

(a) the statement "the Bank of England owns the South African Reserve" simply cannot be true. The SARB is owned by the South African Government and minority shareholders of whoever wishes to buy such shares (when they become available). I would suggest you read "Noseweek", which has shed great insight into the workings of the SARB. Also, the South African Government has recently passed legislation that defangs these minority shareholders.

(b) the video said that overseas banks buy shares in SA gold mines, then manipulate the share price downwards to cause financial distress to the mines. A low share price does not cause financial distress to a company, only a low price for its product.....so the buying and selling of gold shares would seem to me to be the least effective way of manipulating the gold price?

Mike Klee

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Agreed but the thrust of the argument is correct.

 

Hi Mike

 

Pleased you picked that up!

 

I am not suggesting that that video is without fault but the general thrust is correct. I would suggest that the private ownership of any state's central bank is NOT good - and that is what I am trying to point out. The SARB has a limit of 10,000 shares for any investor - out of just 2,000,000. The Reserve Bank of any country should be run by government seeing that its income comes from tax payers paying back public debt. It isn't. In the US (the global currency) the Federal Reserve Bank is owned by the major banking families and banks (who remain anonymous) - and if they sneeze South Africa catches a bad cold - see video two.

 

Look at video one and the ACTUAL value of FIAT MONEY then consider how gold and silver prices are manipulated lower by PAPER TRADES on Wall Street - and that is S Africa's assets going overseas at a bargain discount price. That, to me, is theft. The IMF and World Bank (referred to in the video) are flag bearers for the major US banks and do not have your best interests at heart...

 

If I had found a video on who owns South Africa which was without any faults I would have linked it.

 

PS from a recent press release by the S A Reserve Bank you can sense the frustration shareholders.. Letter to Shareholders Have you ever heard of a public company being accused of corruption and theft and no comment in the media? And this is not any public company... see the other videos on how the media knowingly cover up the fiat system.

 

This Business Day report linked here and quoted below gives an insight into the shareholder's concerns... allAfrica.com: South Africa: Reserve Bank Bill Process Challenged

 

Quote:

Cape Town — The Reserve Bank was pushing through amendments to its founding act with "unseemly haste", Charl Kocks, head of African governance ratings agency Afrika Ratings, told MPs yesterday.

His criticism adds to the chorus of complaints by disgruntled Bank shareholders who object to the proposed amendments, intended to limit their power to elect representatives to the Bank's board.

 

Does anyone know who is on the SA Reserve Bank's board and who they represent? Apparently the President (Zuma) appoints the governor, three deputies and three of fourteen directors.

 

Interesting background on the SARB here: http://www.southafrica.info/business/economy/policies/reservebank.htm

 

Kind regards

 

Scott Balson

Edited by ndoa18

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The Bigger Picture

 

PS I am not claiming to be an expert on the S A Reserve Bank - I am not.. maybe someone here is...

 

I don't want us to lose sight of the bigger picture - see the other videos.

 

So I will leave this part of the debate to others.

 

Kind regards

 

Scott Balson

Edited by ndoa18

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jwither

There is a defintely a general lack of understanding on how the financial system works. Here is the first of many installments I have on this topic. I can clarify these as necessary if anyone is interested. The analysis I wrote is written from the standpoint of the United States, but there is no substantive difference from one country to another, if any. The primary purpose of this analysis is to explain the dynamics of inflation and deflation and indirectly, who benefits from either.

 

Defining money

To most, this should not even need definition but before there can be any discussion on the prospects for inflation or deflation, it is necessary to define our terms.

So what exactly is money? Today it is almost entirely fiat currencies issued by national central banks and treasuries. Most people think in terms of the paper notes they carry around but in actuality, the vast majority of the “money supply” is electronic debits and credits recorded in the computer systems of your financial institution.

The first point I am going to make here is that contrary to the opinions of most people and specifically financial professionals and economists, there is no difference between money and non-money. It is purely arbitrary and artificial.

In the modern era, “money” is the fiat currency issued by the central bank but historically, it has generally been gold and silver but also other base metals plus occasionally, other items. In theory, it could be ANYTHING, whatever the private economy decided if there was a free market in money. Due to practical considerations gold and silver have been the choice due to (1) scarcity (2) portability and of high value (3) divisibility.

Today, most supposed “money” is actually NONE of these. There is little “money” in use in the financial system. The same applies to the “money supply”. The vast majority of the “money supply” is actually CREDIT and DEBT. If you ask someone where they have their money, they will tell you (as examples) in a bank account, the stock market or a bond. NONE of these are “money”. They are in actuality LIABILITIES of the issuer which must almost always first be sold before you can actually obtain ACTUAL “money”.

Defining inflation

 

This is another term which to most people is apparently obvious, but it isn’t either. There are two primary definitions of inflation.

 

The first and technically correct one is an expansion of the money supply which today in actuality really means an expansion of outstanding credit.

 

The second is an increase in prices which in actuality is the RESULT of credit and monetary inflation. For purposes of this discussion, I will use the term credit inflation for the first and price inflation for the second.

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No John!

 

Hi John

 

I normally agree with you and really enjoy and respect your input but I have two points of difference with your last post.

 

The first point I am going to make here is that contrary to the opinions of most people and specifically financial professionals and economists, there is no difference between money and non-money. It is purely arbitrary and artificial.
Gold and silver have since the beginning of time been recognised as having value in themselves (ie a silver coin has an asset value in itself - the silver). Fiat currency is based on debt and (today) has nothing but future taxation of the masses supporting its value. Fiat money is at the whim of traders and speculators. Reminds me of some Biblical references regarding the money lenders in the temples - in my view they have just refined the process.

 

And..

silver should be several thousand dollars per ounce .. if you accept the argument in this video .. it's all about manipulation by Wall Street. ) P S this video is just over a month old and the silver price then was under US$21...... it has gone up nearly 25% since then.

 

Defining inflation
Inflation is clearly a form of taxation with the profits (from our loss in value of assets) going to the central banks - ie not to support the community as it should be.

 

It is because of this private taxation gold and silver have exploded in value - demonstrating just how we have been screwed ever since we went off the gold standard. The profits from "private taxation" land up in the hands of the major shareholders of the banks running the Reserve or Central Banks.

 

In effect investing in gold and silver takes the manipulation of the banks out of the picture and (in my view) in light of the impending fiat currency implosion, gives those who hold gold and silver a head start.

 

John, according to many commentators fiat money is unconstitutional in the US (representing the global currency) - I would be interested in our comments on:

 

a) is that true?

b) why are the public not aware of this fact? and

c) just what the constitution actually says on this issue (the system of money)

This video on Youtube seems to make a lot of sense:

 

Kind regards

 

Scott Balson

Edited by ndoa18

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Dangerous Times

 

My intuition is freaking me out.

 

We live in very dangerous times.

 

The western media is controlled by Wall Street interests and do not tell the whole truth; the major banks in the US are now facing ruin through gold and silver short selling; quantitative easing has destroyed the US dollar's role as the global currency - its collapse is in virtual freefall (Wall Street in action); banks are closing down all over the US ... hundreds this year, and; despite the US Reserve Bank's "printing presses" going mad sufficient jobs are not being created in the US.

 

What we have now is a growing class of poor in the US, a shrinking middle class and a tiny but extremely affluent and privileged wealthy class who are "too big to fail".

 

In effect the super-wealthy bankers have become the aristocrisy of old. The Kings, Queens and their offspring live in castles built on screwing everyone else through their control of Fiat Money. We know that the US Senate is controlled by the lobby groups (despite Obama's shallow promise) and laws are enacted to protect their masters. And the money men will not let go of their wealth or influence without a fight.

 

Sovereign debt in Europe is getting very much worse but the media have pushed this reality under the carpet. Fiat Money is in general collapse.

 

Zoellick's comment overnight is as concerning as the first admission by the media in the 1990s, after years of denial, that "globalisation was a reality" .. and was of course "good for the plebs (you and me)". (See this post on BoB re Zoellick: http://forum.bidorbuy.co.za/coins-notes-numismatist/9090-cusp-22.html#post89556)

 

The President of the World Bank is now signalling the basis of a global currency.. incorporating a few major first world currencies. China, the world's emerging financial superpower, is left off the basket suggested by Zoellick. If you look at all the world wars they have all been sparked by financial issues. Today we live in a world where guided missiles and unmanned aircraft form the first strike force - they are sophisticated weapons that will kill millions. In the Middle East we have the Sunni and Shia tearing the guts out of each other in divided Iraq. Israel, the West Bank and Iran is the wildcard. And then we have growing global poverty - which always leads to unrest, and as traditionally stable countries face instability the food and medical support they have given third world countries will dry up as self-interest prevails.

 

The world is historically long overdue a major world war and the next one, whenever it happens, will be a duzie. In my view the next ten years will either see

 

1) trade becoming more regionalised and localised (ie less global ownership, more nationalisation) with a gold based financial system replacing a failed FIAT money system - but, I believe, that this can only come as the result of a world war involving the US, China, the Middle East and Europe - because it will take this sort of global disruption for the Wall Street money power to lose its current control over the world,

OR

2) there will be a single global currency replacing all our state currencies (ZAR, Au$, Euro etc) with the banking aristocrisy completely controlling us like serfs - and, within the next 50 years, identification microchips under our skin monitoring our every transaction and move.

 

I will say no more but that we live in very dangerous times and, sadly, the first option is, in my view, in the best interests of our grand children.

 

NOTE: These comments are based on my intuition and research but have no factual basis.

 

Kind regards

 

Scott Balson

Edited by ndoa18

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Shill Financing

 

We have all heard about shill bidding but how about a new term you heard first here on BoB?

 

Shill Financing

 

Citibank is one of the major banks in the US which was bailed out by the tax payers in that country following the global financial collapse. Of course the Au$ is strong so guess what is now happening as a result?

 

In the last three months I have had a cascade of unsolicited credit card applications from Citibank (the Australian arm) wanting me to take out their credit card with guaranteed facilities of thousands of dollars - no questions asked. They have all landed up in the shredder - as did the one received today.

 

Why is this important? CNBC (a US based finance cable program owned by General Electric - owned by the big banks) was talking earlier today about the major banks in the US using their wins from quantitative easing not to help their own economy but to look for opportunities in "emerging markets in Asia". I guess that now includes us.

 

Here is the fraud - quantitative easing is backed by US tax payers aimed at stimulating employment. However, the big banks are taking that money offshore to maximise their own profits. How does that help the struggling US tax payer? It doesn't.

 

Fiat money is a complete fraud and the US$ is rubbish!

 

Kind regards

 

Scott Balson

Edited by ndoa18

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Its simple mathematics

 

The video clips below exposes the flaws of fiat money and inflation.... arithmetic takes away any argument suggesting that fiat money will survive.

 

So why did the greedy central banks develop a mortally flawed system knowing it would fail?

 

You must watch these.....

 

Youtube clip - part one (10 minutes):

 

just after two minues in this part he talks about the impact of inflation on the value of your money, pension, share values.. it will blow you away!

 

Remember when gold was backing currency (eg gold sovereign) there was no inflation for hundreds of years.

 

Remember inflation is a form of taxation levied by the central banks on us!!!!

Kind regards

 

Scott Balson

Edited by ndoa18

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Cold Sea

The facts according to Scott

 

NOTE: These comments are based on my intuition and research but have no factual basis.

 

Scott, you are truly amazing.

 

Cheers

 

Derick

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Facts and predictions..

 

Hi Derick

 

Let me explain. Nothing that is in the future can be predicted factually.. that's why we use the word predicted. Events from the past can be recorded factually - often this requires research.

 

Hope this helps.

 

Kind regards

 

Scott Balson

Edited by ndoa18

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jwither

Scott,

 

To answer your question on the constitutionality of US fiat money, I am not a constitutional "expert" but yes, I absolutely believe that the PRIVATE or at least QUASI-PRIVATE issuance of federal reserve notes is unconstitutional. But then, the apologists for the system have probably gotten around this by first claiming that the US courts have already ruled on this issue. They have but I believe they simply made the incorrect interpretation. And second, its also possible that because federal reserve notes are not issued by the US Treasury that this is why it is technically "legal".

 

The US constitution, which I believe to be the ultimate legal document ever written, does not address central banks. Probably for the simple reason that there were enough signotories who opposed one. There were some, such as Alexander Hamilton as first US Treasury Secretary, who favored it. But to my knowledge, the First Bank of the United States (1796-1816) and Second Bnak of the United States (1816-1836) did not resemble the modern Fed. But it might not have been that different to the Fed prior to 1933 and I just do not know it since both were constrained by the gold standard.

 

As for inflation, it is a tax (and a fraud) but not specifically for bankers. Its really for those who have first access to money. Personally, since banks have both their assets and liabilities denominated in depreciating fiat currency, I do not see that this particularly gives them any specific advantage.

 

Here is the next concept to cover.

 

Financial Systems

 

There are two types of financial systems in existence today, a currency based system and a credit or fractional reserve lending system.

 

A currency based system is one where the money supply is composed of circulating money such as bank notes and coinage. In actuality, there is no economy which uses a pure currency system because every economy (to my knowledge) has some credit, but for purposes of this discussion, I will refer to a currency system as one which provides limited credit availability or where credit represents a much smaller proportion of the “money supply” and purchasing power equivalents compared to the “sophisticated” (Ponzi scheme) financial systems.

 

A fractional reserve lending system is where most of the “money supply” and purchasing power is composed of credit and debt. This is the (Ponzi scheme) system that dominates the global economy today.

Edited by jwither

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The money trust

 

Hi John

 

This short video gives an excellent understanding of how the Federal Reserve came about in 1913:

 

The banking cartel:

 

As you will the financial system is based on fraud, is fraud and aimed at deceiving the wider population.

 

Here is another article on this subject: http://wiki.answers.com/Q/Is_the_federal_reserve_act_of_1913_a_fraud

 

So who owns the Federal Reserve? http://www.youtube.com/watch?v=bLCHWhmyn8w

 

And this is what the money trust/ money power want (another short video):

 

Yes, they want the US$ to collapse - they want a global currency THEY CONTROL - like the mainstream media who are supposed to keep YOU informed.

 

Kind regards

 

Scott Balson

Edited by ndoa18

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jwither

I'm not a believer in conspiracies in the sense that some are. I believe there is an "open" conspiracy to create a world government because there are many influential people who favor it or seem to favor it. David Rockefeller is one even though he denied it for decades.

 

But at the same time, it is a mistake and an error to assume, as most apparently do, that those who are behind this movement are monolithic. They are not robots who are going to sacrifice their self-interest more than anyone else will which is why you see the division and strife in political organizations such as the EU now. When it comes to currencies, many or even most of these people would either be ruined or lose a fortune which is why I do not believe that most of them either want to or will destroy the USD or any other hard currency inentionally. Not only do they not want to but they cannot do so because none of them have the power to do so unilaterally. The post I wrote before on what Fed Chairman Ben Bernanke can and cannot do applies equally to everybody else.

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Legalised corruption sums up Wall Street

 

Hi John

 

Interesting debate on CNBC earlier today.

 

To me this just sums up Gordon Gekko (greed is good) - the flawed and corrupt system which is Wall Street.

 

The US taxpayers bailed out General Motors for billions of dollars during the GFC to save it from collapse. As a result of the bailout nearly 100,000 GM jobs were lost and those who remained (about 200,000) lost most of their perks - resulting in massive profits for an overhauled company with just four car brands being kept.

 

Here is the sting in the tail.

 

GM shares were relisted today at US$33 each but ONLY made available to large institutional investors through J P Morgan and the other big banks brought in to oversee the listing. It is expected when the shares go on market tomorrow they will, within hours, increase by 15%. So the institutional and wealthy investors will simply offer their US$33 shares for sale and make a 15% profit from the taxpayer (retail investor) in a couple of hours.

 

So the tax payer footed the bill for saving the company; the major investors make 15% in less than 24 hours and the tax payer (who takes up the offer) gets left with shares that could go either way.

 

IMPORTANT NOTE: TAXPAYERS - RETAIL INVESTORS WERE NOT ABLE TO BUY THE SHARES IN THE COMPANY THEY SAVED AT US$33

 

See for launch of GM shares: News Headlines

If Wall Street does that over a listing what does it do in the big currency/fiat-monopoly money game .. this is nothing more than legalised fraud. And has been ever since the Rothchilds, Rockefellers etc took over the Fed. But to make a direct comment against the money power results in being labeled anti-Semitic or racist by the mainstream media; and guess who runs that?

 

It is a very strange world we live in.

 

Kind regards

 

Scott Balson

Edited by ndoa18

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jwither

Well, I do not know what to tell you about GM. I suppose the US government could have had an open IPO auction in which everyone had a chance to buy shares. That would have eliminated the immediate aftermarket profit though since I can guarantee you that the public would never have an opportunity to buy in at $33 a share either because the price would be higher. I'm not aware that this has ever been done except possibly with Google. I recall that this is what they were going to do but do not know if they actually did.

 

As for the GM employees, as far as I am concerned, they made out like bandits, at least those who kept their jobs. I do not know the specifics but they definitely made out better than the bondholders who were SECURED creditors or at least some of them were.

 

Personally, I do not believe that there should have been a bailout at all and I absolutely do not believe that the union should have been bailed out either. The management of this company has been absolutely awful for as long as I can remember but the union was equally to blame for the recent bankruptcy. Did you know that, at least until recently, at least some laid off employees contined to receive 95% of their pay indefnitely. I'm not sure how many did so but it may have been a lot of them, even all of them who were in the union. That is absolutely insane.

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Hi John

 

I totally agree.

 

But if we were on the gold standard none of this could have happened. The central banks are to blame and now they are raping and pillaging American wealth for their own profit because fiat money is like a piece of string - just find the end (you never will).

 

Kind regards

 

Scott Balson

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How corrupt is fiat money?

 

QUOTE:

Banks in Ireland – as elsewhere in the USA and Europe – declared themselves insolvent and so got billions in taxpayer bailouts. Government „guarantees“ to the banks for these fraudulent paper debts has resulted in a gigantic mound of national debt to the very same banks that created the crisis in the first place.

 

Deutsche Bank is one of the main holders of Irish bonds, gulping up Irish tax payer’s money and Deutsche Bank will also swallow up any „eurozone“ bailout.

 

The Irish government plans to impose unprecedented spending cuts or tax rises totalling 6bn euros (£5bn) to pay off these fraudulent debts and bring its budget deficit down from about 12% to about 9.5 % next year.

 

Source: Why financial collapse is approaching so fast for the euro

 

Kind regards

 

Scott Balson

 

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The price of silver killing J P Morgan - buy an ounce of silver

 

As silver rises J P Morgan gets closer to crashing - over US$1 trillion exposure now... between 25 to 50% of all shorts on silver are held by J P Morgan

 

See: FREE PLANET: Max Keiser - crash JP Morgan buy silver - JFK federal reserve link 11110

 

Fascinating 30 minute video which also discusses Fiat Money - see first 13 minutes of the video; the second part looks at the corrupt mainstream media.

 

Kind regards

 

Scott Balson

Edited by ndoa18

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Executive Order 11110 - JF Kennedy

 

Quote:

 

On June 4, 1963, a little known attempt was made to strip the Federal Reserve Bank of its power to loan money to the government at interest. On that day President John F. Kennedy signed Executive Order No. 11110 that returned to the U.S. government the power to issue currency, without going through the Federal Reserve. Mr. Kennedy's order gave the Treasury the power "to issue silver certificates against any silver bullion, silver, or standard silver dollars in the Treasury." This meant that for every ounce of silver in the U.S. Treasury's vault, the government could introduce new money into circulation. In all, Kennedy brought nearly $4.3 billion in U.S. notes into circulation. The ramifications of this bill are enormous.

 

With the stroke of a pen, Mr. Kennedy was on his way to putting the Federal Reserve Bank of New York out of business. If enough of these silver certificats were to come into circulation they would have eliminated the demand for Federal Reserve notes. This is because the silver certificates are backed by silver and the Federal Reserve notes are not backed by anything. Executive Order 11110 could have prevented the national debt from reaching its current level, because it would have given the gevernment the ability to repay its debt without going to the Federal Reserve and being charged interest in order to create the new money. Executive Order 11110 gave the U.S. the ability to create its own money backed by silver.

 

After Mr. Kennedy was assassinated just five months later, no more silver certificates were issued. The Final Call has learned that the Executive Order was never repealed by any U.S. President through an Executive Order and is still valid. Why then has no president utilized it? Virtually all of the nearly $6 trillion in debt has been created since 1963, and if a U.S. president had utilized Executive Order 11110 the debt would be nowhere near the current level. Perhaps the assassination of JFK was a warning to future presidents who would think to eliminate the U.S. debt by eliminating the Federal Reserve's control over the creation of money. Mr. Kennedy challenged the government of money by challenging the two most successful vehicles that have ever been used to drive up debt - war and the creation of money by a privately-owned central bank. His efforts to have all troops out of Vietnam by 1965 and Executive Order 11110 would have severely cut into the profits and control of the New York banking establishment.

 

Source: John-F-Kennedy.net - JFK, The Federal Reserve And Executive Order 11110 by Cedric X

 

And from Wikipedia: http://en.wikipedia.org/wiki/Executive_Order_11110

 

Kind regards

 

Scott Balson

Edited by ndoa18

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jwither

A couple of comments on your last posts.

 

I have never heard of that executive order but as far as I know, it would have been irrelevant. The President of the United States does not have the authority to do that. The Federal Reserve would simply have challenged Kennedy in court if necessary and he would have lost.

 

As for JP Morgan and its silver expsoure, for it to have $1 trillion in silver exposure, it would have to have contracts on 40 billion ounces which at a standard size contract of 5000 ounces, would be 8 million. Are you sure your math is correct? The other possibility is that they have part of those positions hedged in some way because contrary to this claim, I absolutely do not believe they are part of some conspiracy to drive down the price of silver. They have absolutely nothing to gain from that. The other thing I would add is that you and those who agree with you must be the only ones who believe that JP Morgan's crash is imminent because it sure is not reflected in the stock price. During the financial crisis of 2008, the banking stocks did crash even as the fantasy of "mark to model" asset accounting continued and still does to this day. But it was not in silver futures which are level 1 assets and which MUST be marked to current value, but in all the other garbage they have on their balance sheet. If anything is going to crash this bank or any other large one, its not going to be any supposed silver manipulation but their mountain of bad loans, pending lawsuits and derivative exposure elsewhere. JP Morgan's notional derivative exposure in financial instruments was least $50 trillion several years ago and could be in the hundreds by now.

 

As for Ireland, they should never have agreed to bail out the banks. The politicians were a bunch of fools and traitors to do that. I absolutely believe that austerity was the course to take but doing so in conjunction with a bank bailout is absolutely insane. And its even dumber when combined with a bailout of foreign depositors. Why should Irish taxpayers bail out international banks and someone who does not even live there?

 

I would not have bailed out the banks at all but if I had, I would have left the international operations to collapse and saved the local operations. The other host governments could bail out the rest of it at their own expense.

Edited by jwither

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QEII and other manipulation by banks

 

Excellent article on .. quote:

 

Why the Federal Reserve's Quantitative Easing Strategy Won't Save the U.S. Economy

 

QUOTE from the article:

 

But here's a shocker: The Federal Reserve's real dual mandate is to enrich the banks the central bank is created by and works for – and to cover Congress when its laws enrich banks at the expense of jobless American taxpayers.

 

See: Why the Federal Reserve's Quantitative Easing Strategy Won't Save the U.S. Economy - Money Morning

 

With regards to J P Morgan and silver ... just Google to see how exposed the pariah is.

 

For example: YouTube - Silvergate - Precious Metals Price Manipulation Whistleblower Revealed By GATA

 

Kind regards

 

Scott Balson

Edited by ndoa18

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jwither

I just performed a Google search on "silver futures contracts open interest". According to the COMEX data on this site http://www.gotgoldreport.com/2010/11/us-banks-in-silver-futures.html, COMEX had a total open interest of 158,633 as of November 2nd. Even though there are other exchanges in both the US and elsewhere (London the primary one), this does not remotely equate to 8 MILLION which is what is necessary to reach an exposure of $1T at today's prices. And even this would imply that JPM had a position in ALL of them which is obviously false.

 

Any claim that JPM is about to collapse based upon this reason is not supported by the facts which can be independently verified. And there is no reason to accept any unsubstantiated claim at face value simply because someone says it is true either. No one should believe this type of claim until that proof is given.

 

The best evidence of whether JPM (or any company or issuer for that matter) is about to fail is the open market price of their publictly traded shares and debt instruments. There are any number of instances that I (or anyone else) can provide to support this. The "poster child" example is Enron in 2002 where so many claimed they were "shocked" that it went bankrupt even though it had been rated "AAA" by S&P and Moody's either days or weeks before its collapse. Well, no one should have been surprised at all. Even before it became general knowledge that they were in any trouble at all, the stock had crashed from $70 to $14. Anyone can also observe the same pattern in the financial stocks such as Citigroup and Fannie Mae in 2008.

 

If this claim were remotely true, then why is the stock at $40/share now when it was below $20 at the height of the financial crisis in late 2008? Are you trying to tell me that EVERYONE has been duped except for those who are making these claims? If so, that makes no sense.

 

Do I believe that JPM is a sound institution today? No, I do not. I believe they are technically insolvent and inadequately capitalized, regardless of what any regulatory agency says or what the "stool pigeon" security analysts say either. But this is no more true of JPM than either every other or practically every other large financial institution in the world today.

 

Its just that it has nothing to do whatsoever with silver and to the extent that they have any unrealized losses in silver, its a pittance of the total they actually have. We can know they are insolventr because of the reasons I gave. The volume of non-performing loans is much higher than the historical average and this is for what they admit. There are undoubtedly many other loans in commercial real estate and commercial lending which are actually worth much less RIGHT NOW than the carried value. And this is true even before many additional loans go bad in the near future which is almost certainly going to happen. But both the regulators and knowledgeable market players already kow this though no one may knowexactly how much.

 

These banks also have huge exposure to "Level 2" and "Level 3" assets which DWARF even this supposed silver exposure which cannot even be substantiated. This is the 'mark to fantasy" accounting which some of you must have heard.

 

When JPM and the other banks collapse in the next stage of the financial crisis, it will have absolutely nothing to do with their silver losses. Those will be a miniscule fraction of the total, however much they may be.

Edited by jwither

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Hi John

 

I guess we will just have to wait and see :)

 

Kind regards

 

Scott Balson

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