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For many, the US dollar is the nation’s fiat currency. It all starts with the US Treasury just who creates bonds which are governing administration IOU’s that are paid back for a specific time period with curiosity.

The Treasury holds monthly auctions to sell off a bonds to primary marketers, who are the major mortgage lenders. Then the US Federal Reserve enters the game by getting all the bonds from the banks through something called “open market operations”.

Once again nothing backs those dollars except IOU’s. Furthermore, for the hard work each individual US citizen does to help you earn his or her salary, a part of it eventually ends up in the Treasury in the form of income taxes. This is exactly what pays the principle and interest on the bond that Fed bought with a examine from nothing. US citizens happen to be forced into paying taxes for the use of our present-day money supply system.

Once again that banks go back to the US Treasury auctions the next month investing in more bonds and providing them to the Federal Save. And every month this cycle of buying and selling keeps on getting repeated.

The entire system of making money from nothing is a ready-made scam. It all starts while using the Federal Reserve and the YOU Treasury exchanging IOU’s. A good check is an IOU meant for cash and a bond is an IOU to be reimbursed with interest at several later date. Cash has existence once the Fed difficulties someone a check.

Within the financial banking sector we now have the things I refer to as “magic money creation” which is truly called “Fractional Reserve Lending”. Here is an example of how fractional reserve lending works. Let’s pretend someone deposits $100. 00 into a bank account, the bank that received that deposit is now legally allowed to remove $90. 00 or ninety percent of your deposit and re-lend it to someone else.

The person who received your hard earned cash from the bank as a loan product will use it to buy an item such as a car. Then that person will pay the car dealer while using the money he borrowed. Right now the car dealer will lodge this money into an individual’s own account at the loan company. Now there is $190. 00 on deposit and the bank can legally steal Three months percent again or $81. 00 and lend it out.

However, it’s important to note, that when all the Fed writes and difficulties a check, there is no revenue what so ever in the account to cover the amount of which usually check. The account those checks are written from will always carry your zero balance. Therefore each dollar that exists, is actually borrowed and must be repaid.

At last over time, there becomes surplus bonds at the Fed and cash in the Treasury. The Treasury now takes the following excess cash and deposits it into the various organizations of government.

In that way actually leaving your balance with only $10. 00 or ten percent of your finish deposit. However your loan company statement will still demonstrate to the entire $100. 00 funds or one hundred percent of your bank, on deposit in your balance.

This can be a Ultimate Government backed and sponsored pyramid scheme, when only the banking top dogs who own the Federal reserve and other central banks around the world, massively profit by stealing out of generations of innocent people.

Which is then spend on wars, military, federal salaries, social programs, general public work projects and other shortfall spending that keeps concerning re-occurring. Next all those government employees and military personnel take their salaries and deposit them into a variety of bank accounts throughout the location. This is how the fiat capital now enters the commercial banking sector.

The next person after that comes along, and borrows revenue. Once the new borrower pays off the seller for what these bought the money again can be re-deposited into the bank and there is $271 dollars with deposit. This creation from money through deposits and loans (fractional reserve lending) keeps re-occurring to where at some point your original $100. 00 deposit has grown to $1000. 00 (ten moments the amount of your original deposit) in fiat currency made out of the bank.