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| Joined: | Mon Nov 21st, 2005 |
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It is often said that the Federal Reserve System is the lender of last resort. This indicates a misunderstanding of the financial system. The Federal Reserve is the lender of next-to-last resort. Holders of money are the lenders of last resort.
The lenders have no choice. They lend because there are two loan officers: Congress and the Federal Reserve. Congress collects the loans through direct taxation. The Federal Reserve collects it by indirect taxation: inflation.
I am making time for commentary on this article before I read the whole thing. Readers can read that whole link, readers can read my commentary, the order of which is read first is up to the reader. I decide to write my commentary first.
Gary North is a person who may describe himself as a conservative, perhaps not. I describe Gary North as someone who reports facts in such a way as to promote his agenda. The facts are worth reading, the agenda is less worthy – in my opinion.
My agenda is called Power-Independence, and I make no secret of this fact.
Power produced into a state of oversupply, the more the better, until the limit of power production is reached will cause a political and economic reality of which few people have a desire to imagine.
Why?
I can guess the answer and convey that answer to you, to Gary North, and to anyone who lives life based upon moral principle, and anyone who has an interest in preserving productive human life, happy life, on into the foreseeable future and possibly even further.
The principle behind a lack of interest in finding out just how much power our species can produce is crime.
That is my guess.
To further communicate the reasons for my guess I offer a definition for the word I use, that being crime.
Crime is the pre-meditated employment of brain power toward injury of innocent people and then the willful exertion of physical power to cause those injuries upon those innocent victims.
Innocence, if you can see what I see, is the state of being where the individual is not encumbered with power draining thoughts of guilt, remorse, and conscience destroying self-loathing. An innocent person is free to think in ways where creativity is possible, more likely, relatively speaking.
A person who is not innocent is a person who may fear being discovered, being hounded, being punished. How much time and energy (power) is left to access the creative realm of human being?
The principle behind crime, as far as I can tell, is to create more criminals or, perhaps the flip side of the same coin, the principle behind crime is to eliminate the competition.
The competition is populated by non-criminals, those innocent ones, the people who access creativity, the ones who produce, and the ones who create value out of stark naked physical reality.
So much for my mornings rant, I hope readers do read Gary North and I may also find the time to do so.
While firms and families large and small around the country struggle to obtain financing or refinancing, and with the Fortune 500 companies' earnings down 85 percent on average (the worst performance in the ranking's 55-year history), the banks at the heart of the financial meltdown are beginning to report profits again. Bank of America, which received $45 billion in bailout money, reported $4.2 billion in first-quarter earnings. I'm certainly no financial whiz -- when the economy tanked last year, what money I had was sitting in a checking-savings account -- but who wouldn't be able to show a $4.2 billion profit after getting $45 billion in bailout money?
Next is the part describing how competition in legal money markets is punished, outlawed, or eliminated, (avenged) and how the monopoly, the cartel, or the "insiders" are rewarded (redeemed).
In the Mosaic law, there was a peculiar office: the ga'al. The word means "redeemer." This office had two aspects: vengeance and redemption. The ga'al was both the blood-avenger and the kinsman-redeemer. He was the nearest of kin. When his closest relative was killed because of an alleged accident, the blood-avenger was legally allowed to pursue the suspect and kill him. The only way for the suspect to escape vengeance was to flee to a city of refuge. There, he would be tried by a court. If he was convicted of what we call manslaughter or criminal negligence, the ga'al could not legally kill him, unless he caught the man outside the gates of the city. He went completely free upon the death of the high priest (Deut. 19).
The ga'al also had the responsibility of buying his nearest of kin out of slavery, if the kinsman went into slavery because of forfeiting on a debt (Lev. 25:48–49). A central bank is the unofficial ga'al of the fractional reserve banking system. It is an agency of vengeance. It pursues those banks and would-be banks that offer loans that are more competitive than the banking cartel has established through the central bank. It is also the agency of redemption. When a big bank gets into a crisis because of its pyramiding of debt, the central bank redeems that bank.
Last edited on Wed May 13th, 2009 12:43 pm by Joe Kelley