A special live event and screening of a documentary on fiscal responsibility entitled I.O.U.S.A. was held this evening. Ron Paul had a small part in the movie (actually two), but it was one of the more crowd pleasing moments of the entire movie. Paul’s clip showed him questioning Greenspan and telling him that if a doctor had the same failure rate at meeting his goals, patients would die. Then silence and everyone staring at each other, including Greenspan, all dumbfounded. Hilarious. The packed theater thought so too as the crowd laughed heartily and loudly.
The movie as a whole took great pains to be non-partisan and was quite successful. Ron Paul was the only Presidential candidate in the movie painted in a positive light. In fact he was utilized as an expert, especially during the discussion of the Fed and it’s power. The unflattering moments were saved for George W. Bush in the final part of the movie on the “leadership deficit”.
Bill Clinton received some positive air play for balancing the budget in the late 90’s. I was pleased that they then accurately added Social Security and Medicare to the budget equation showing the surplus being wiped out.
In Part 3, it was explained that money is a commodity and its main purpose is to serve as a medium of exchange. We also learned about the 7 “Ron Paul requirements” of good money. This article will define the four types of money followed by a discussion of what is the best currency.
“We make money the old fashioned way. We print it.”
– Art Rolnick, former Chief Economist, Minneapolis Federal Reserve Bank
Subject: How big is the money supply?
The value of your money depends on the amount of money in circulation. Is it possible for you, as a layman, to learn and understand how large the money supply is, and whether it’s growing or shrinking?
Probably not. There are many measurements of the money supply, and there seems to be no consensus about which measurements are best. These measurements go by the names M-zero, M1, M2, M3, and MZM. There’s even something called the “True Money Supply,” devised by Murray Rothbard, and reported at the website of the Ludwig von Mises Institute.
The “True Money Supply” page will also give you numbers for M1, M2, M3, and MZM, but the numbers are only updated through April, and the M1 measurement, for some reason, is only current through February of 2006.
Well, you could try the Federal Reserve instead. They ought to know, right? Well, there are problems there too. The Fed doesn’t report M3 anymore, which some people think is the best measurement. The Fed also provides two different numbers for M1 and M2, one seasonally adjusted, and one not, without explaining what the seasonal adjustment entails. Worse still . . .
Open your wallet and take a look at the money you have inside. Hopefully you have some metallic coins and slips of paper (actually its linen). Take a closer look. At the top in large letters it reads: ‘FEDERAL RESERVE NOTE.’
The Federal Reserve is the central bank of the United States. It issued the money you hold in your hands, although the Department of the Treasury actually printed it. Although it has the word ‘Federal’ in the title, the Federal Reserve is a private bank or company delegated the power by Congress to manipulate the money supply. It is no more ‘federal’ than Federal Express or Wal-Mart for that matter. More on this later.
Now, far more curious is the use and definition of the financial term ‘note.’
Note - A written promise to pay a specific sum of money on a certain date. A written pledge to pay.
Interesting. A ‘Note’ is actually a form of Debt, i.e. you are owed its worth by the United States government. The linen also has text “THIS NOTE IS LEGAL TENDER FOR ALL DEBTS, PUBLIC AND PRIVATE.” ‘Legal Tender’ is a legalese that means money that cannot be refused by law when you are paid or go to buy something.
But what is this note for debt actually worth ? A common fallacy is that the worth of the dollar is indirectly tied to the gold at Fort Knox. Dead wrong! Another is that the dollar is tied to the nation’s GDP/GNP/purchasing-power parity. There is some truth to this, as the dollar’s worth ‘floats’ or fluctuates with the exchange rates of other currencies like the Euro and Yen, but what is a dollaractually worth ?
This series will seek to explain what I’ve nicknamed the Money Matrix. We will first discuss what money really is or should be, then educate ourselves on why the current global monetary system is intrinsically flawed. As we proceed, taboo topics or not-well-understood time-bombs like the Federal Reserve, financial derivatives, and hyperinflation will be discussed. The last part of the series will seek to provide basic understandings of US big government finances such as the national debt, social security, the income tax, the trade deficit, etc. My goal is to explain this as simply as possible and how the current global monetary policy is morally wrong, so please ask any questions as probably both you and I will learn something further.
However, anything I write will just be tidbits of a greater truth, what I write will not be a substitute for thorough understanding. With that end in mind, I’ve included an online source list with comments at the end of this letter for you, the Reader, to peruse.
For your reference, this column really started with my outrage and personal search for truth concerning the morally wrong American wars of invasion or the “War on Terror,” but in a way I now believe I have been treating just a particularly egregious symptom, not the disease itself. Like Neo choosing the pill of reality, I believe I have at last come in contact with the walls of this ‘Matrix’, and having ripped a hole in it, and at long last can peek out and gaze at a reality for the first time from the outside in. I see how this Matrix has enslaved (or controlled, take your pick) all, and constrained mankind from our full potential. I see how this Matrix has enabled more wars and strife for our world, and I will now oppose it, rid of my ignorance. However, make no mistake, history is littered with battles of free men against this Matrix, and the wreckage of defeat is strewn throughout the sands of time, as well as the modern day. (To clarify the ‘Money Matrix’ idea, I believe it just consists of people and groups with their own motives, ideas, beliefs, resources, and desires, not some type of wacko conspiracy. These people (just like I) are just acting out life in their vision which may include “for the greater good of all” or for more self-centered reasons.)
Quote of the Day:
“Be thankful we’re not getting all the government we’re paying for.”
– Will Rogers
Subject: Can we control the runaway federal deficit?
When you earn less, you must spend less. But when the government earns less, it spends more, usually by borrowing. It’s happening right now.
The U.S. economy has slowed. Tax revenues are dropping, but government spending is soaring. The federal deficit is projected to reach a record level next year — $490 billion. That’s nearly half a trillion dollars added to the national debt in just one year.
This is bad for the economy. Money that’s borrowed by the government can’t be borrowed by businesses. Businesses create jobs. Businesses are competing with the government for capital. It’s a competition businesses can’t win. But it gets worse . . . Read More »
The White House released a budget deficit projection today for 2009 at $490 billion. In more shocking news, the Democrats and Republicans blamed each other for the mess. Bush inherited a budget deficit of $128 billion from Bill Clinton in 2001. This after Clinton was praised the year before for showing a budget surplus. What a wonderful gift George Bush and his Congress are leaving for the next administration and America. It’s like receiving a mugging for Christmas.
The two major parties continue to rearrange deck chairs on the Titanic while truly fiscally responsible Third Party candidates are waving their arms wildly holding up life preservers trying their best to show the economic geniuses the way to salvation. Maybe someday they will pay attention.
The White House on Monday predicted a record deficit of $490 billion for the 2009 budget year, a senior government official told CNN.
The deficit would amount to roughly 3.5 percent of the nation’s $14 trillion economy.
The official pointed to a faltering economy and the bipartisan $170 billion stimulus package that passed earlier this year for the record deficit.
The fiscal year begins October 1, 2008.
The federal deficit is the difference between what the government spends and what it takes in from taxes and other revenue sources. The government must borrow money to make up the difference.
The official spoke on the condition of anonymity, citing a lack of authorization to speak publicly ahead of an official briefing later Monday by Office of Management and Budget Director Jim Nussle.
White House spokeswoman Dana Perino said the stimulus package was necessary, even if it increased the deficit.
The current Bush AIDS relief plan expires at the end of September. That was a Bush backed plan to send $15 Billion overseas (mostly Africa) to combat the proliferation of AIDS. Now, the House has approved another Bush backed relief plan that more than triples the current plan, bringing the total to $48 Billion. Bush is said to be running around with pen in hand anxious to sign the bill.
I must sound like a jackass for saying anything against such a “charitable” thing but if that is the case then so be it. I don’t care if it is AIDS relief or sending billions of our tax payer money to places like Pakistan, Saudi Arabia, or Israel for whatever reason. I think we should just stop. If I were to become President (gods help us all) I’d install a large plasma screen (at my own private expense) on the ceiling above my bed in the White House. On the screen will be the the National Debt clock. Every day after falling asleep I will have ticking number nightmares and wake up in a cold sweat until I take action so that the numbers reverse and start counting towards zero.
It is actions like these that confirm the notion that the two major parties are just more of the same.
I feel like crying. I feel like what my daughter must feel like when I brush her ever-tangled hair each night. “Daddy, please make it stop!” I guess I’m supposed to welcome Big Daddy Government’s painful brush by now, but I just can’t do it, not even for AIDS relief.
Ron Paul is keeping up with his promise to release periodic video messages regarding the “happenings” in with our lawmakers. Here he discusses the recent House bill to bail out Fannie Mae and Freddie Mac among other topics. He, as usual, relates the bailout to the devaluation of the dollar. Check it out below.
I have, for the past 35 years, expressed my grave concern for the future of America. The course we have taken over the past century has threatened our liberties, security and prosperity. In spite of these long-held concerns, I have days – growing more frequent all the time – when I’m convinced the time is now upon us that some Big Events are about to occur. These fast-approaching events will not go unnoticed. They will affect all of us. They will not be limited to just some areas of our country. The world economy and political system will share in the chaos about to be unleashed.
Liberty Maven
In Part 3, it was explained that money is a commodity and its main purpose is to serve as a medium of exchange. We also learned about the 7 “Ron Paul requirements” of good money. This article will define the four types of money followed by a discussion of what is the best currency.
Money can be classified into 4 types.
