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28
Jul

How to Create Money Out of Nothing

   Posted by: chris   in Fish Talk

We all know by now that the Federal Reserve actually creates money out of thin air. The government produces a bond for 10 billion and the Federal Reserve waves its wand an hey presto 10 billion appears from absolutely out of nowhere.

All this is fine for the Fed but how do you as an ordinary person perform this act of pure financial alchemy. The answer is really simple. Buy a house.

When Joe and Jane public go excitedly to the closing for their new home they are actually partaking in the magical ritual of money manifesting.

The reality is that whatever amount is stated on the home loan documentation is miraculously pulled from thin air. The lending institution does not take the loan amount from its reserves and give it to the seller. Rather the lending institution through the miracle of line item accounting writes the money into existence and gives this newly created line item to the seller.

The buyer gets their new home. The seller gets a ledger line item in the sale amount on the ledger of their bank. The bank that facilitated the transaction in the form of a fictitious loan gets monthly payments from the new home owner for up to 30 years.

This micro financial transaction goes macro and now there are millions of apparent home owners. Millions of line item loans. Millions of monthly home loan checks in the mail.

Everything works just fine until bugs appear in the precariously balanced system. The seller wants cash instead of a line item, the home loan check isn’t in the mail, the lender has more line items cash calls than his/her reserves can meet.

There is no money. Money is an agreement. It is a way of measuring indebtedness. Without debt there is no money. Absolutely and totally no money.

There is only property or control of property. A man/woman’s wealth is measured in money which is actually a reflection of what they control.

Human energy is a resource which just like property can be controlled. The ultimate wealth is reflected in the control of the premier resource which is human energy.

The Primary means of controlling human energy is debt. The unit of measurement of debt in modern society is money.

Most people think that they go to their mundane job for money and this is precisely how the people who control the human resource designed it to appear. It is however a carefully crafted illusion. The reason you go to your mundane job is because you are indebted and you must make repayments in the form of your energy. Put simply you must work off your debt.

But the sad reality in the case of the home owner is that not alone are you indebted to the seller who sold you their home; there is also the middle man who facilitated the deal with the ledger line item to pay.

In the case of a $200,000 home loan at 5% interest over a 30 year period the interest paid to the facilitator would be $231,676.

The total costs of the repayments of a $200,000 home loan are $431,676.

The lender gets $231,676

The seller gets $200,000

The buyer gets screwed.

Now if the lender was actually giving something of value to the transaction then a case could be made for the huge profits. But the reality is that the lender by manipulating a system, created the funds brought to the closing table out of nothing.

The simple accounting trick of writing $200,000 into a ledger and thereby creating a loan or debt enabled the lending institution to control the borrower’s energy in the amount of $1,199.10 every month for up to 30 years.

 

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This entry was posted on Tuesday, July 28th, 2009 at 2:53 pm and is filed under Fish Talk. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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