Well Rick blew the hell out of that one. Not only is paper legal tender because it says so on the note, it's legal tender in law, specifically Section 31 U.S.C. 5103, which defines U.S. legal tender. And guess what is not defined as legal tender, bank and Wall Street generated Credit, or if you prefer, electronic digits. In point of fact, credit has no legal standing as a currency, let alone 'money' at all, not even the credit generated by the Fed. Another fact that has apparently escaped Rick's attention is, all of that credit (electronic digits) represent an I.O.U. legal tender dollars as payment in full. But, I can understand Rick's desire to conflate the credit that drives Wall Street, with the actual legal tender money, no one wants to deal with the fact that they've been bamboozled and cheated out of their money with their acceptance of bank debt (credit) as payment.
The bank's war on cash is an attempt by banks to get out of debt free by negating their legal responsibility to redeem their debt generated credit currency (electronic digits) with legal tender upon demand. It is the legal tender that is the money, the credit generated by Wall Street and the banks, has no legal standing as a currency and it most certainly is not money.
Prior to 2014, the Fed used to print that fact in the upper left margin on every H.6 report, it read as follows:
"Credit dollars are a debt generated currency that is denominated by a unit of account. Unlike money, credit itself cannot act as a unit of account. However, many forms of credit can readily act as a medium of exchange. As such, various forms of credit are frequently referred to as money and are included in estimates of the money supply."
Now, wasn't that magnanimous of the Fed to accommodate our lackadaisical misidentification of bank generated credit/debt as money, and include that bank debt as being part of the money supply....
It's in the history of money, which extends well beyond the 1990's when credit first gained acceptance as a form of payment via the innovation of electronic banking and the 'debit card' which made credit a viable, and standard use, medium of exchange.
Gold, Silver = Money Tally Sticks = A Proxy For Money Credit = Debt
Gold, Silver = Money Paper = A Proxy For Money Credit = Debt
Gold = Money Paper = A Proxy For Money Credit = Debt
Paper gets Promoted = Money Credit = Debt
Paper = Money Credit = Debt + A Proxy For Money
Credit gets Promoted = Money = Perpetual Debt
The paper Federal Reserve Note is, by government decree and law, the money. it was put into circulation to replace the U.S. notes that promised to pay gold (and in 1933, the gold), that were already in circulation as money. Banks already held a supply of money that belonged to their depositors and even today, every deposit account is representative of the money that is supposed to be in supply. (That's why the Fed counts deposits as being part of the money supply, even though there is no money in them.)
The FRNs in circulation is not determined by loans, it is determined by public demand for the notes, and while you may request notes with a loan, they are not loaned into circulation. Anyone with a deposit account can get FRNs because they are the Legal Tender Money and deposit accounts represent that Money being held for depositors. Fractional Reserve Banking means that banks are only required to hold a small portion of Money in reserve to meet customer demands for that money. Demand deposit accounts represent, both in law and by contract, their obligation to Give You Your Legal Tender Money Upon Demand. Every deposit account is bank DEBT. And what makes deposit accounts bank debt, is the legal tender law, which defines the money, the medium that banks are legally obligated to maintain on you behalf. And, unlike bank generated credit, FRNs and US coin are Your Money, not theirs. Get it; your money, their DEBT?
Well Rick blew the hell out of that one. Not only is paper legal tender because it says so on the note, it's legal tender in law, specifically Section 31 U.S.C. 5103, which defines U.S. legal tender. And guess what is not defined as legal tender, bank and Wall Street generated Credit, or if you prefer, electronic digits. In point of fact, credit has no legal standing as a currency, let alone 'money' at all, not even the credit generated by the Fed. Another fact that has apparently escaped Rick's attention is, all of that credit (electronic digits) represent an I.O.U. legal tender dollars as payment in full. But, I can understand Rick's desire to conflate the credit that drives Wall Street, with the actual legal tender money, no one wants to deal with the fact that they've been bamboozled and cheated out of their money with their acceptance of bank debt (credit) as payment.
ReplyDeleteThe bank's war on cash is an attempt by banks to get out of debt free by negating their legal responsibility to redeem their debt generated credit currency (electronic digits) with legal tender upon demand. It is the legal tender that is the money, the credit generated by Wall Street and the banks, has no legal standing as a currency and it most certainly is not money.
ReplyDeletePrior to 2014, the Fed used to print that fact in the upper left margin on every H.6 report, it read as follows:
"Credit dollars are a debt generated currency that is denominated by a unit of account. Unlike money, credit itself cannot act as a unit of account. However, many forms of credit can readily act as a medium of exchange. As such, various forms of credit are frequently referred to as money and are included in estimates of the money supply."
Now, wasn't that magnanimous of the Fed to accommodate our lackadaisical misidentification of bank generated credit/debt as money, and include that bank debt as being part of the money supply....
It's in the history of money, which extends well beyond the 1990's when credit first gained acceptance as a form of payment via the innovation of electronic banking and the 'debit card' which made credit a viable, and standard use, medium of exchange.
ReplyDeleteGold, Silver = Money
Tally Sticks = A Proxy For Money
Credit = Debt
Gold, Silver = Money
Paper = A Proxy For Money
Credit = Debt
Gold = Money
Paper = A Proxy For Money
Credit = Debt
Paper gets Promoted = Money
Credit = Debt
Paper = Money
Credit = Debt + A Proxy For Money
Credit gets Promoted = Money = Perpetual Debt
The paper Federal Reserve Note is, by government decree and law, the money. it was put into circulation to replace the U.S. notes that promised to pay gold (and in 1933, the gold), that were already in circulation as money. Banks already held a supply of money that belonged to their depositors and even today, every deposit account is representative of the money that is supposed to be in supply. (That's why the Fed counts deposits as being part of the money supply, even though there is no money in them.)
The FRNs in circulation is not determined by loans, it is determined by public demand for the notes, and while you may request notes with a loan, they are not loaned into circulation. Anyone with a deposit account can get FRNs because they are the Legal Tender Money and deposit accounts represent that Money being held for depositors. Fractional Reserve Banking means that banks are only required to hold a small portion of Money in reserve to meet customer demands for that money. Demand deposit accounts represent, both in law and by contract, their obligation to Give You Your Legal Tender Money Upon Demand. Every deposit account is bank DEBT. And what makes deposit accounts bank debt, is the legal tender law, which defines the money, the medium that banks are legally obligated to maintain on you behalf. And, unlike bank generated credit, FRNs and US coin are Your Money, not theirs. Get it; your money, their DEBT?
I hope this helps....