[MonteQuest]

From my book:

$this->bbcode_second_pass_quote('', 'O')ne of the most important powers given to the Fed was the right to buy and sell government securities, and provide loans to member banks so they might also purchase them. This provided another built-in mechanism for profit to the banks if the government debt was increased. All that was needed was a method to pay off the debt. This was accomplished through the passage of the income tax in 1913. A national income tax was declared unconstitutional in 1895 by the Supreme Court, so a constitutional amendment was proposed in Congress by none other than—Senator Nelson Aldrich.

Since it was graduated, the tax would “soak the rich” ...but the rich had other plans, already devising a method of protecting wealth. By the time the (16th) Amendment had been approved by the states, the “ruling elite” had created “foundations.” They used them as repositories for their “divested” interests...making their assets non-taxable so that they might be passed down through generations without...estate and gift taxes. Each year the ruling elite can dump up to half their incomes into their pet foundations and deduct the “donations” from their income tax. With the means to loan enormous sums to the government (the Federal Reserve), a method to repay the debt (income tax), and an escape from taxation for the wealthy, (foundations), all that remained was an excuse to borrow money. History has shown us that nothing drives a government more deeply into debt than major war.

[nth]

It is hard to imagine US actually broke. I can see the economy crashing and all that, but broke?
US debt is denominated in USD, so technically, they are borrowing from themselves. They are selling securities to lenders and promised to pay the lenders back in paper notes aka money. With US having a lot more paper notes in circulation than the bonds they sold, it will be quite hard for US to go broke.

[Dreamtwister]

The US has been broke since it went off the gold standard, and that was in 1973. Since then, it's just been borrowing against it's own future.

Well, it's time to pay up, kiddies.

[firestarter]

$this->bbcode_second_pass_quote('nero', ' ') Most of the Fed's "profits" are given to the federal government. .

[rogerhb]

$this->bbcode_second_pass_quote('nth', 'I')t is hard to imagine US actually broke. I can see the economy crashing and all that, but broke?
US debt is denominated in USD, so technically, they are borrowing from themselves.

[firestarter]

$this->bbcode_second_pass_quote('rogerhb', '')$this->bbcode_second_pass_quote('nth', 'I')t is hard to imagine US actually broke. I can see the economy crashing and all that, but broke?
US debt is denominated in USD, so technically, they are borrowing from themselves.

[Kingcoal]

Bankruptcy is when the creditors come pounding on the door and you don't answer or you answer and tell them you can't pay today. As far as I know, the creditors have not demanded their money, so we aren't bankrupt yet.

I guess it would be pounding on Tony Soprano's door and demanding your money back. Nuff said?

[pedalling_faster]

$this->bbcode_second_pass_quote('MonteQuest', 'F')rom my book

[nero]

$this->bbcode_second_pass_quote('firestarter', 'A')nother way of looking at the Fed is where do its profits come from, in other words, what are the sources of revenue of the Federal Reserve?"

By far the largest is interest on its holdings of U.S. Government securities. This accounts for almost 99 percent of the Federal Reserve income.

btw, can you source what "most" of the Fed's profits that are confiscated by the govt. amount to? 10%, 40%, 70%?

[rwwff]

$this->bbcode_second_pass_quote('Kingcoal', 'B')ankruptcy is when the creditors come pounding on the door and you don't answer or you answer and tell them you can't pay today. As far as I know, the creditors have not demanded their money, so we aren't bankrupt yet..

[firestarter]

$this->bbcode_second_pass_quote('nero', '')$this->bbcode_second_pass_quote('firestarter', 'A')nother way of looking at the Fed is where do its profits come from, in other words, what are the sources of revenue of the Federal Reserve?"

By far the largest is interest on its holdings of U.S. Government securities. This accounts for almost 99 percent of the Federal Reserve income.

btw, can you source what "most" of the Fed's profits that are confiscated by the govt. amount to? 10%, 40%, 70%?

[rwwff]

$this->bbcode_second_pass_quote('firestarter', '"')Since it does not have the money, and Congress has given away its authority to "create" it, the Government must go to the "creators" for the $1 billion.

[nero]

$this->bbcode_second_pass_quote('', 'W')hat are the results of this fantastic transaction? Well, $1 billion in government bills are paid all right, but the Government has now indebted the people to the bankers for $1 billion on which the people must pay interest!

[firestarter]

$this->bbcode_second_pass_quote('nero', '')$this->bbcode_second_pass_quote('', 'W')hat are the results of this fantastic transaction? Well, $1 billion in government bills are paid all right, but the Government has now indebted the people to the bankers for $1 billion on which the people must pay interest!

[LadyRuby]

Here's a lecture at MIT by this guy (he wrote a book on the same topic):

Kotlikoff - on why the US is bankrupt

[firestarter]

$this->bbcode_second_pass_quote('nero', '
')
$this->bbcode_second_pass_quote('', 'T')ens of thousands of such transactions have taken place since 1913 so that in 2005, the U.S. Government is indebted to the Bankers for more than $8,000,000,000,000 (trillion). Much of the income taxes that we pay as individuals now goes straight into the hands of the bankers, just to pay off the interest alone, with no hope of ever paying off the principle. Our children will be forced into servitude. "

[BrazilianPO]

One point that I do not see being discussed much is the other currencies reaction to the US$ going down. Given the connectivity between countries and economies, it is very likely that the US$, euro, Yen, Yuan, etc, will all go down together. I do not see the US going broke and Europe saying "ha, ha", damn you Americans, we Europeans will be just fine.

In a situation of global recession triggered by debt and rising oil prices, where does the smart money go to? Russian rublos, Iranian rials, Saudi riyals, Venezuelan bolivars, precious metals, land?

[nero]

$this->bbcode_second_pass_quote('', 'T')he Federal Reserve is a private corporation and private corporations are not taxed at a 95% rate. One third of that rate, maybe, but I'm not so sure that the Federal Reserve pays a dime in taxes, yet I'm willing to be educated.

[presidentsherrill]

I am going to let you all in on a little secret.


The United States is a failure. The United States has been dead ever since we first declared bankruptcy at the beginning of this last century. Since that time the US government has been a corporation. A corporation so poorly run, that to compare to enron is an isult to the Memory of Ken Lay.