In the previous blog article, we discussed how money is created in the form of debt. As crazy as that sounds, it is only half the story. Aside from controlling the money supply [inflation], the Federal Reserve also controls the interest rates.

The Federal Reserve does not simply supply a government’s economy with money, it loans it to them at interest!

It doesn’t take a lot of ingenuity to figure this scam out. When the government borrows money from the Fed or when person borrows money from a bank, it almost always has to be paid back with accrued interest. In other words, almost every single dollar that exists must be eventually returned to a bank, with interest paid as well.

This is when it gets ridiculous, see if you can follow…

If all money is borrowed from the central bank and is expanded by the commercial banks through loans, only what would be referred to as the ‘principle’ is being created in the money supply…. So then, where is the money to cover all of the interest that is charged by the Federal Reserve?

Nowhere. It doesn’t exist. The ramifications of this are staggering, for the amount of money owed back to the banks will always exceed the amount of money that is available in circulation. This is why inflation is a constant in the economy, for new money is always needed to help cover old debts.

The central bank has to perpetually increase its money supply to temporarily cover the outstanding debt created through interest; and as we have already learned, all new money is loaned out at interest which creates even more debt. The end result of this system is slavery for it is impossible for the government, and thus the public, to ever come out of the self-generating debt.

The fractional reserve policy perpetrated by the Federal Reserve is, in fact, a system of modern slavery. Think about it… Money is created out of debt. And what do people do when they’re in debt? They submit to employment to pay it off. But, if money can only be created out of loans, how can society ever be debt free?

It can’t. And that’s the point!

To put it a different way, every single dollar in your wallet is owed to somebody by somebody; for remember, the only way the money can come into existence is from loans.

Physical slavery requires people to be housed and fed. Economic slavery requires the people to feed and house themselves.

Here is another example on how the idea of interest is used to create and maintain the class structure, it’s called social mobility. This basically refers to the degree to which an individual’s or group’s descendants move up and down the class system. If you are born to great wealth, there is a great chance that you will stay wealthy. If you are born into poverty, chances are that you will stay poor.

This reality can be blamed in part to the financial system, in particular the mechanism of interest. If you have $1 million and you put it into a C.D. at 5%, you will generate $50,000 a year for doing absolutely nothing. You are making money of money itself.

Now, if you are a lower to middle class person, which must get an interest-based loan to buy a home or use a credit card, you are essentially paying interest to the bank which the bank is using to pay the person’s return with the 5% C.D.

This is outrageously offensive, interest is used to steal from the poor and give to the rich. It’s designed to uphold class stratification, keep the lower classes poor under the constant burden of debt, while keeping the upper classes rich with the means to turn excess money “magically” into more money.

Slavery never ended, it has just evolved. This is one of the most ingenious scams for social manipulation ever created. Debt is the weapon used to conquer and enslave societies and interest is its prime ammunition.

If all this sounds completely crazy to you, or you say to yourself “It’s too big of a scam operation for it to be true” or “this is simply conspiracy theory nonsense”. I say to you, please pick up a finance book. This is actually very public information, all one has to do is take a step back and think for a second. Take a few university level classes on Economics, Finance, Sociology and Poverty…Many professors are aware of this and are trying their best to inform their students of the changes that our society very much needs.

To give a great example of something completely fabricated and sold to us as fact, just look at religion. I need not elaborate.

There is no “man behind the curtain”. This is simply the society that we have built over time. We have allowed it to happen. It’s culture my friends, nothing more, nothing less. It’s time we take responsibility: Change our culture, change our system.

Either we continue as apathetic clogs in the wheel, ignoring the horrendous system that we have created; or we can actually be civilized human beings!

Thanks for reading and spread the word,

Notes:

1. Disclaimer: Most of the information and words used on this article come directly from Zeitgeist: Addendum. I highly recommend watching the movie: http://video.google.com/videoplay?docid=7065205277695921912#
2. Social Pathology | The Zeitgeist Movement | NYC 2010 http://vimeo.com/10707453
3. Fed Profits: $52 Billion in 2009, CNN Money: http://money.cnn.com/2010/01/12/news/economy/fed_profits.fortune/
4. Modern Money Mechanics: http://en.wikisource.org/wiki/File:Modern_Money_Mechanics.pdf
5. About the Federal Reserve System – The Drawing Board Video: http://www.clevelandfed.org/About_Us/who_we_are/about_the_system/index.cfm
6. Time Magazine: Person of the Year 2009; How the Federal Reserve Works http://www.time.com/time/specials/packages/article/0,28804,1946375_1947930_1947942,00.html
7. Federal Reserve Education: http://www.federalreserveeducation.org/
8. The Federal Reserve – Duties: http://www.investopedia.com/university/thefed/fed2.asp