Thomas says:

'

John, sorry to hear that SWHBC banned you from participation, even from Sunday School.  I will miss your presence and contributions to the discussions.

Thanks for this last/final recording.  It was much appreciated.

Hope you are able to make a reconciliation with your family and other church leadership. 

In this latest essay, I’ve given it my best shot to try to help you understand money in another way, I don’t know what else I can say to help you resolve the conflicts you find with your last church.  I’ve attempted to enroll in you in my vision of the truth and errors about money, and you have attempted to enroll me in yours.  We have both come away more convinced of the truth of our respective visions than when we started, but we’ve had a great deal of fun, learned a lot, and grown as people.  It was one of the my most valuable, interesting, and growthful discussions.  I hope you gained as much from the discussion as I did. 

John Replies:

Just like Herb Gray helped us work out the details of how God’s law needs to be applied by bringing up various legal issues we don’t normally think about, in the same way, you really helped we flesh-out the many facets of what is involved in the differences between the monetary hole-in-the-ground and the monetary mountain. The difference between having money and not having money – the difference between using something as money and using nothing as money. Especially profited/enlighted from the mental exercise of mapping out what it would take to insure that the money-issuing-Central-Bank was only increasing/decreasing the money supply to perfectly keep overall prices ‘stable’.

In short, this last effort to analyze why the Fed was a bad idea has finally taken the mystery out of the question “Where is the error in allowing the Fed to create fiat money?”  The Fed is a de facto monetary tyranny, they are in effect gods of money creation.

Remember ‘tyranny’ comes from the word-root for ‘Without Authority’. And if they did create, they would be the supreme God, not just gods. Lower-case gods can only manufacture, since they cannot create themselves. But we have proven that money-issuers do not create, they can only dilute. Any value their ‘new’ money has, can only have value to the extent they leach purchasing-power out of previously-existing money. If somehow the ‘new’ money was distinguishable from the ‘old’ money, people would not accept it because the fraud would be evident. I’m sure you could do an experiment yourself that would confirm this. Thus, they cannot create, they can only dilute. If you pour your gallon of water in the barrel of wine, and then scoop out a new gallon of well-mixed solution, your new ‘water’ is sweeter to the exact degree that the other 54 gallons are going to be watered-down.

  If they were in fact God, their creation would be good/right and all would prosper because new money would be created by giving credit to only those best deserving. 

Even if they were God it would not help. It is not possible for the Triune God of the Bible to create the kind of money that central banks ‘create’. When God fiats – when He says, “Let there be…” – the thing He says to become, does become exactly as He says it to be. And then it exists. When Central Banks say, “let there be…”, they do not actually say (describe, define) what is to be, and nothing comes into being as a result of their saying or doing. Of course, I mean they do not say when you drill down into their official publications where they are being serious about the actual mechanics. It is possible to understand what they are saying if you are careful not to be bamboozled by the mood and tone of how they are saying it. As they are saying what is really going on, their core sentences are decorated on every side by intimations of how beneficial it is, and how unavoidable it is. The true God cannot say for something to be without that something coming into existence. As far as I have read and thought, God does not routinely de-create stuff He has created. Central Bank money issuers create without anything being created and decreate as their main routine. People borrow money into existence (falsely so-called) and pay back money out of existence

But they are not ‘getting’ anything, nor are they getting something they either deserve (as if they had earned it, or been entitled to (as your long-explanations imply, like on the basis if they accomplish some component of production) – they are being enslaved and robbed of interest rent on the money BECAUSE it belongs to the issuer. In a way, it is not being robbed, because they willingly submit themselves to pay that rent. There is no question that it is robbery for all the other dollar-holders in the world – unless you see the moral entanglement in their willingness to use the fraudulent money. Most people are ignorant that the use of the banker’s fraudulent money is wrong. People that do, have a greater responsibility to “bell the cat”, to help the ox of ignorance out of the ditch, to return the lost thing that they find. This is why Rushdoony calls for teachers and pastors to fulfill their responsibility:

[More from Rushdoony, Institutes] p 470.

Fractional reserve banking, unbacked or partially backed paper money, and inflation of money by debt and credit, is thus a violation of this law. Isaiah, in listing the charges in God’s bill of indictment against Jerusalem, declared that “Thy silver is become dross, thy wine mixed with water” (Isa. 1:22). The reference is to false weights,silver replaced with baser metals, or heavily alloyed with them, and to false measures, a quart of wine made into a gallon by mixture with water.

Thus the law clearly requires the condemnation of all fraudulent money. The law of the guilty bystander thus clearly condemns all ministers, priests, and teachers who do not declare the sentence of the law against fraudulent money. Their silence means a guilt comparable to that of corrupt judges or of counterfeiters, in that they counterfeit God’s word by their silence or by false interpretations.

As surely as a false yardstick or a false cup measure defrauds a man, just as surely a false money defrauds a man. Even worse, dishonest money introduces a false weight into every monetary transaction in a society, so that radical corruption and injustice prevail. If in every business transaction in any society a basic fraud prevails in the form of dishonest and counterfeit money, then the entire society is polluted, honest men are robbed, and thieves prevail. This is precisely what monetary fraud and inflation perpetrate, the triumph of thieves over godly men. Silence in the face of such radical corruption is an inexcusable ignorance and an evil.

P 486

To return to the interpretation of theft as, essentially, the robbing of a man’s freedom: false weights and measures, fraudulent money, and the destruction, impairment or theft of property all diminish or destroy a man’s freedom. Property is basic to man’s freedom. A tyrannical state always limits a man’s use of his property, taxes it, or confiscates that property as an effective means of enslaving a man without necessarily touching his person.

But, given that they are human, they make errors in judging the amount of new money that should be created to meet the level of men’s willingness to work, given their desire to consume, and their particular desire for consumption. 

It is so odd that you would acknowledge in the prior paragraph that it is not possible to create, and then imply that money can be created and that it is just difficult to accurately determine how much should be created.

Why would we think that men will be frustrated in their desire to work unless new money is created? What is wrong with the existing quantities of measurable substance that someone could be persuaded to trade for work? This is called freedom, to be able to make covenants and agreements with others to trade time, work, money, stuff, anything we want. If a man lacks it just means he has not found someone who is willing to trade with him or give him what he lacks. Just because this takes initiative, effort, and diligence is no excuse to give a banking system the exclusive criminal privilege to pretend to make loans to people and collect rent on what is not there.

Remember, this is not about the market needing new money. If new money was a better thing, they could plan from time to time to multiply what everybody owes each other by some factor greater than 1.0. Say on the last Sunday in March, all bank accounts could be doubled, all loans could be doubled, all prices could be doubled, and new coin & currency could be issued with an Expiration Date on the old sets to be turned in for twice as much. But, what is the point?

The point is to give only an elite society of nation-controllers the advantage in wealth and power to effectively resist the advance of the kingdom of our Lord Jesus Christ.

I believe this analysis captures the error of letting a central agency create money, rather than letting the multicentric market (i.e. individuals) do the same.  When we were on the gold standard, there was no individual or group who decided how much new money to create, people simply created more gold by work/effort, and that new money was traded into circulation.

There is nothing magic about gold, or even money. The Lord Christ/Trinity graciously gives men the power to manufacture wealth out of Creation in order to be fruitful, multiply, fill the earth, and dominate the animals (thus fulfilling the Image of God). People apply their energies, talents, and willingness to serve God and each other – and a great part of that is increasing the useful goods and services. Any goods and services can be traded. Why aren’t we legally allowed to rent farm tractors which do not exist? Why should it be harder for a farmer to rent imaginary money than a Banker? Why will the farmer go to jail if he tries to?

Curious why you use the word “created” more gold. Shouldn’t we use the term “manufacture”?

A desire for monetary expansion was organically met by desire and work by the sovereign decision by millions/billions of individuals. 

This is more true than is comfortable. Bankers have been given freedom to do what they do because General Public desires cheaper prices on the services banks offer. They want cheaper security for their money, cheaper transaction costs, higher interest rates on savings, and cheaper interest-rates on loans. They do not care that the bankers are plundering the world in order to subsidize their money services. They don’t realize they are ambushing their own lives. Also, what do you mean by "sovereign" in the sentence above. Billions of individuals are sovereign over Who? God? Men? Bankers? Government? The constellation of various, semi-secret, oath-bound societies who worship and serve Lucifer as the rightful heir of the universe in defiance of our Lord(Owner) Jesus Christ?

But, with the advent of fiat currency/the rule of the Fed, there is no effort involved in the creation of new money, and thus credit can be expanded infinitely. 

There is effort, a great deal of effort, but just in an area that is not associated with this. Effort is expended by the expenditure of blood and treasure in using our US military to force other nations of the world to continue trading exclusively by means of the US Dollar. Saddam Hussein and Muammar Gaddafi come to mind, as well as the constant Saber-Rattling against Iran.

The lack of discrimination in credit expansion produces malinvestment, resulting in the production of products for which there is no organic/commensurate demand, resulting in investments which produce little return, and money in great supply chasing the few products which are desired, thus inflation.

Your use of the noun, “discrimination” implies there is a correct, ideal rate of theft to drain purchasing-power out of the money-holders of the world.

A person could read the above paragraph and think you were calling the price-increases inflation, instead of being true to the reality that the inflation is the increase of the supply of money, and price-increases are just the result of that. Credit expansion means “creation” of new money. Loaning more of the money someone already possesses is a completely different animal.

We are in for a rough ride, and I don’t think it will be reversed by men becoming wise; rather, the end of the trip will most likely end with a crash or an even deeper/stronger tyranny than the current subtle tyranny of the Fed/the false gods of money creation. 

T.

Men who refuse to honor the Trinity and give thanks cannot become economically or politically wiser. They will think they are and will brag about their world/man-centered wisdom. Professing themselves to be wise, they will become more foolish, and find themselves increasingly under the very destructive dominion of other men and the desires of their own souls and bodies.

The big question for us concerns our responsibility with all this. Consider that you and I are among a tiny minority of people who have thought about our money system and are somewhat aware of its history. Not even Bankers understand it. The ignorant are not going to change it. Whom do you think God holds responsible to “bell the cat”, and to identify the men who can turn this around, and persuade those men to initiate the necessary actions? What will be the moral implications if no one begins to think, or speak, or act as if this massive theft is the righteous and preferred method of maturing into greater freedom and prosperity? If what they are doing is theft, how should the punishment differ between stealing a penny and stealing a trillon dollars? If they are loaning anything that does not belong to them, but steals purchasing power from other dollar holders they have no right to, is this a crime?

is it theft?

are we obligated to coerce them to pay double restitution?

What will God do to us if we don’t?

What will God think of us if we go to the bank and ask them to make up money out of nothing so that our loan interest rate is cheaper than borrowing from a private party who has to worry about what the money he is losing the use of for a period of time – is going to be worth when and if you ever pay him back.

False Memes to expose:

1. Govt wants inflation because it will be easier to pay off the debt. Not so. Even if we had pure, even inflation across the board, among rich and poor, bankers and wage-earners – and the govt had tax-income proportionate with cost inflation, though it would supposedly be easier to pay down old debt, with the cost inflation, the nominal tally of NEW debt would be accelerating higher to offset the supposed advantage/leverage of paying off old debt. In reality, inflation is not even, and rises in prices do not keep pace with increases in wages. Therefore, not only does Govt costs increase, but since wages do not increase as fast as other costs, the tax-income is going to lag behind Govt’s extra costs, thus decreasing their discretionary income they might have used to pay down old debt. Inflation, the way it actually happens, widens the gap between Govt income and costs, and so accelerates Govt debt.

2. One Country is totally separate from Another Country, and there is the potential of a win/lose situation between countries. China is getting all the gold and silver, and the US will get hung out to dry, China is a self-contained entity that may end up beating us out economically in the world market and perhaps militarily. Or Russia. There really is a cold war where the two countries are in clear opposition. The reality is that these economic, currency, or hot wars do not lead to a country<>country win/lose situation. For the Countries it is a lose/lose situation, because they both end up with less freedom, more bloated administration and greater national debt to the banks. You can’t believe gold and silver are flowing from the armed-West to the unarmed-East unless JP Morgan and Goldman Sachs says it can. At the top, or above the top leadership of these countries (at least since War II), there are men who orchestrate national polices for their own purposes of world domination, in spite of all the show of national politics. I think this is the only explanation of situations like in Ukraine.

3. There will be a time in the near future when men will turn good, honest, and altruistic.This is huge. There is an irrational hope among libertarians & anarchists -- that know enough history to know better – that as the consequences of men’s evil, selfish actions manifest themselves, people in general will learn their lessons and stop stealing from, enslaving, and murdering each other. From whence are they going to obtain this major character/nature update? Most of the history we know shows men and nations being blessed with freedom and prosperity, or cursed with tyrannical oppression, debt, and decline in accordance with how they have treated the Book, and the People of the Book (primarily, the whole Book).

4. There exists such a thing as a US Dollar or any monetary unit of account in the countries of the world today. This all seems reasonable, the way everybody acts and talks, but when you drill down and educate yourself on the methods and mechanics of money and banking, it defies description. There are no words to describe the dollar, how it comes in to being. It is not a something. It is impossible to tell if it is a negation of something, or a nothing. There is such a thing as a mountain, comprised of tons of mass of rock and dirt. There is such a thing as the absence of those tons of mass, but that would just be flat land. A hole is where the whole tons of mass of rock/dirt should be but is not. It is more than a absence, it is a deficiency, and deficit, a debt of rock mass. It is not just that the mountain is not there, but that where no mountain ever was, and the mountain’s-worth of rock/dirt has been removed. In an environment where there is no quantity of measure of substance for money, if money is owed, there is a positive missing and loss of what should have been but never was. Yet if it is impossible for there to be any mass of rock or dirt that could form a mountain, then it is impossible for any to remove material of equal-kind (ie. No material at all). If you cannot have a mountain, then you cannot have a hole-in-the-ground. If you have nothing for money, you have nothing for debt. It will not be possible for you to owe, since there is nothing is owed. Nothing is borrowed. Nothing is owed. The bank has given you nothing. They have only offered you a faux justification to steal the effective wealth of other dollar-holders in the world by dilution. In exchange, they have you pay them for the privilege of getting that shield of “righteousness”. If anyone came up and challenged what you were really doing, you would say, “No, it’s OK. The Bank says it is OK. The Government says it is OK.”

5. The Government is printing money. This has the appearance of truth, because Banks do not actually have the machinery to print the Federal Reserve Notes, Treasury Notes, and Treasury Bills. The Bureau of Engraving and Printing is a department in the U.S. Department of the Treasury (see http://moneyfactory.gov/). When you take the tour of the facility, kitty-corner across the street from the D.C. Holocaust Museum, they will tell you it wouldn’t profit you to grab some sheets of Federal Reserve Notes and run, because they are not legally money yet, when they come off the presses. They are actually paid for their printing costs by the Federal Reserve and the notes do not start becoming debt-transfer certificates until they enter the banking system. Government does print the bills but the bills are not dollars or money. At best, we might say they represent money, but they are not legally operating as such unless issued by a member bank in the Federal Reserve system. Government does not print money.

6. The Banks are printing money. As above, Government prints the bills, as a printing service for the Federal Reserve banking system. However, the number of pallets of Federal Reserve Notes in anyone’s warehouse is never an accurate measure of the quantity of dollars registered on the bank accounts of the world. What makes those printed Federal Reserve Notes legal tender for all debts public and private (except payment of taxes, it turns out) is when a Branch Bank desires some more of them to satisfy the desires of the public, orders them from their Regional Fed Branch (San Francisco), and the Regional Branch orders them from Fed Central. The Branch Bank electronically transfers dollars out of its account with the Federal Reserve and “buys” the paper bills from the them, then they move the physical bills to the Branch Bank. Private account holder walks in to his Branch Bank, gets the Federal Reserve Notes in exchange for the Dollars he surrenders out of his checking or savings account with the Branch Bank. When the physical bills are worn out or torn, they are returned to some local Branch Bank, who “sells” them to the Regional Fed Branch, Dollars are credited back to the Branch Bank. Regional sends them back to Fed Central for incineration, and Regional is credited for the dollars the paper bills represented. Thus we see that the paper bills are traveling in the opposite direction from the dollars. Think of the paper bills at [Debt-Transfer Certificates]. When you obtain them from your bank, they hand you the bill in with the agreement that they will no longer be owing you the dollars those bills represent. Those papers will be accepted among the non-bank public, but eventually, the expectation will be that someone will ‘redeem’ them at some bank who will fulfill the agreement to begin owing them dollars in some account of theirs upon surrender of the paper. All of this is to show that there is a one-for-one relationship of some kind of owing between dollars in an account, and the papers that Fed Central uses to provide debt-transfer certificates. The paper Federal Reserve Notes have nothing to do with how many dollars are created or de-created. If you burned up a suitcase of Benjamins in your fireplace, however many thousands of notes disappeared would have no effect on the dollars in the Fed Central Account which was increased when your Wells Fargo local bank ‘paid’ them to get your Benjamins. As a result of the destruction of your paper bills, you have lost your chance to take them to another bank and have them increase what they say they owe you on one of your accounts. As a result of the destruction of your paper bills, Fed Central will get to keep the Dollars from the Bank that bought them. So when Federal Reserve Notes are annihilated, the number of the dollars in the world don’t change. When Federal Reserve Notes are printed the number of the dollars in the world do not change. When Dollars are increased by the various ways their quantities are reckoned, the number of Federal Reserve Notes in the world are not affected. When Dollars are decreased by payment of the loans that created them, the number of Federal Reserve Notes in the world are not decreased. The claim that printing money, by either Bank or Treasury, causes an increase in the number of dollars in the world -- is a lie.

7. The solution to inflation or dominance by the Bankers is to have Congress/Treasury Government issue new dollars directly instead of borrowing from the banks. Admittedly, this has two attractions for the TaxPayer’s of the Issuing Country:

   1. Cost of paying interest on the loans from the bankers is decreased; and

   2. Supposedly there would be less taxes to pay in income tax. Instead of borrowing, then having to pay back both principal and interest, they would just issue more units of the money of account. The Treasury would be getting the first/greatest value of the “new” money, then those closest to the Treasury (presumably domestic countrymen). As the ‘ripples’ spread out to the further reaches of the ‘pond’ Foreigners holding dollars would be “taxed” by the lesser-value of the money units as they later try to purchase goods at increased prices.

I can see at least 4 problems with this plan:

1. The unfairness of taxing the foreigners. No reason we should charge them for our fiscal irresponsibility. That is the kind of thing that leads to war.

2. The resultant higher prices taxes all previous dollar-holders, but unevenly/unfairly over time and distance.

3. There is no mechanism for “stuffing the genie back in the bottle”, no way of reducing the money supply so that things return back to normal. At least with the hope of paying back the bank-loan principal, there would be a return to the previous quantity of money. In practice, of course, there is a never-ending increase in the number of loans rolling forward and the escalation of how much interest/rent on that new bank-issued money. Only if the Treasury would start annihilating money paid back to them in taxes (instead of spending it on new expenses) would there be hope of “regulating the money supply”, but this starts to look crazy. What’s the point? Why not, rather, just lower the taxes.

4. To properly implement this idea, it would require taking away from the bankers of the world, the legal privilege of requiring their imaginary money to pay taxes. It seems easy to prove the case that bankers have controlled our political class (president, congress, and judiciary) since the days of Andrew Jackson. Read about the struggle he had against Congress to keep the National Bank’s Charter from renewing back in the 1830’s. Notice how long Rep. Ron Paul attempted to return the nation back towards honest money and reduce our dependence on the banks. By his own confession, none of his bills he sponsored every got passed, and you saw how the supposed-democratic Republican Party shut him out of the 2012 National Convention. We need to be realistic about what is going to take to wrest control from those men in control of Federal and State governments, military, police, finance, large corporations, education, transportation, and communications. There is only one group with the power and authority to successfully overcome their controls. Bankers got their legal privilege because they were in control of Congress. That’s how they got the Federal Reserve Act passed in 1913. Even if Congress/Treasury created money directly without borrowing if from the Banks, what makes you think the banks would not still control the whole process?

8. Quantitative Easing. You have to ask, “What quantities are we using and where are they being eased to?” Quantities refer to the “Measure” aspect of what you are trading. How many pounds, how many feet, how many gallons. Sometimes quantities are referring to units of something that is sub-defined by so many quantities of a certain measure of a certain substance. This is how the US dollar started out right after the Constitution. After 1971 all substance was removed from accounts in the banking system, so there is nothing they can “ease” anywhere. The word, “easing”, may refer to how people’s consciences are made to feel better about the bankers robbing all previous dollar holders by their dilution of the money supply by pretending to increase quantities as they loan them out to governments, corporations, and private persons. It was supposed to mean that the 85 billion per month the Fed was magically creating out of nothing to purchase overpriced “assets” from others was such a relatively insignificant amount. I wonder, if the 16 trillion that they loaned out to US branches of foreign banks should have been called Quantitative Shocking?

9. Strong Dollar. This is supposed to mean “strong faith” on the part of those who ignorantly think people will be willing to trade almost as much, or more, for dollars tomorrow, as today. There is nothing strong about the dollar, itself; partly because there is no dollar. As I write this, the other currencies of the world are getting “weaker” compared to the US dollar. In this “race to the bottom” as it is called, this signifies that other currencies (yen, for example) are being diluted/debauched/monetized faster than the dollar. In other words, other central banks are being forced to steal from their own citizens/currency-holders at a faster rate than the NY Fed Octopus is robbing domestic and global US Dollar-holders.