What Calculator Were You Using?

October 10, 2009 | Banking, Congress, Economy

In the article JPMorgan $29 Billion WaMu Windfall Turned Bad Loans Into Income from Bloomberg, the authors explain how the bank turns fiction into more fiction.

The article states, and I quote; “Faced with the highest U.S. unemployment in 25 years and a surging foreclosure rate, the lenders are seizing on a four- year-old rule aimed at standardizing how they book acquired loans that have deteriorated in credit quality. By applying the measure to mortgages and commercial loans that lost value during the worst financial crisis since the Great Depression, the banks will wring revenue from the wreckage, said Robert Willens, a former Lehman Brothers Holdings Inc. executive who runs a tax and accounting consulting firm in New York.”

This is old news, but the major media either doesn’t catch on, or it is simply proving that it is bought and paid for by a corrupt banking cartel. I could say the same for our congress, and legislatures, but I hope it is becoming obvious to the masses.

Once more for those with MBA’s, and accounting degrees, we have a FIAT monetary system. What does this mean you ask? Despite the fact that you attended a university, and they gave you a sheet of paper stating that you actually graduated, you either still don’t get it, or are turning a blind eye. The money did not exist to begin with. It was created out of thin air, which means that the money for a loan, for example, is created by the signature of the borrower. There is no actual transfer of dollars from the net to another net position.

The lender applies the money as a credit to its books, and an accounts receivable is created upon the fictitious debt. It’s all make believe in a world designed to create wealth out of nothing but ink on pieces of paper.

If the money did not exist from the outset, what risk does the lending institution have? In actuality there is none to the financial institution except in the methodology of keeping the books under Generally Accepted Accounting Principles.

When the money is created, the interest on that loan does not exist, nor is it created. If the loan is $1,000,000 and the interest on the loan is .07% there will always be a shortfall in the supply of money. If the loan happens to be a 30-year loan then the payout over that period amounts to $2,395,087. That means that there is a shortfall of $1,395,087 in the money supply.

Extrapolate over time, and several loans, and the deficiency in the supply of money can amount to quite a large sum. Now add to that the fact that loans are bundled up, and sold off creating additional accounting without the necessary money created to be applied to other interests, or whatever it is that the purchaser of a derivative might hope to obtain. The FIAT money is drawn from accounts, but real, solid, whole property is not at hand in order to compensate for all the wrangling that is going on. It’s a pyramid type scheme that is wholly embraced by our government.

Explore from the point of credit derivatives, and you begin to see the problem unfold over the long haul. Billions of sheets of paper created that are based on a limited true value piece of property, without creating the means to pay any of it back. The value of the property is subject to the whims of an economic system that can be manipulated quite easily. Therefore if the money powers decide a recession is due, then they can easily manipulate the economy down because only a small portion of the system has true value.

In the short run, those who understand the system take advantage of the false accounting principles. They reap huge profits, and bonuses until it starts to unravel. Who is holding the bag on this Ponzi scheme?

Ponzi scheme? “A Ponzi scheme is a fraudulent investment operation that pays returns to investors from their own money or money paid by subsequent investors rather than from any actual profit earned. The Ponzi scheme usually offers returns that other investments cannot guarantee in order to entice new investors, in the form of short-term returns that are either abnormally high or unusually consistent.”

When congress abrogated its constitutionally mandated responsibility to control the monetary system the outcome was that it left the People with the tab for the coming slaughter. Massive taxes will need to be imposed on all the lambs out there who thought they were getting their just reward.

Since the borrowing of money has become an intricate, or more correctly a totally unnecessary part of maintaining the monetary system we are left with the problem of repayment. Hopefully we understand that the failure to create the means to produce anything of substance will lead us to bankruptcy. http://drudgereport.com/flashocs.htm

By allowing the government to create an unconstitutional enterprise such as the FED, we have given the greedy, and dishonest the ability to control every aspect of the monetary system, and therefore our lives.

We the People need to step back and review. Forget about what we’ve been told, and clear our minds of the rumbling that is taking place between our ears.

On one hand we have the growing unemployment rate, and a congress all too willing to bail out, or confiscated some industry all for the illusion that they are doing something about our financial problems. Our problems were caused by a callous and corrupt congress to begin with so we want them to stop. Just shut up, release those industries that you have destroyed through massive regulation, and allow the little guy to grow his own enterprise without having to fear some regulation, or non-constitutional bureaucrat who loves the feel of the power to destroy.

Congress should be doing everything within their limited power to rectify the situation since much of it has been caused by their outright corruption, and disdain for a vibrant economic system where people are allowed to create.

Congress can regulate trade, impose excise taxes, and control immigration. They have done everything wrong in these areas. They should be levying stiff import taxes, up the tax burden on companies that out-source to foreign nations, and begin repealing work visas. This won’t happen because much of congress has a deep abiding hatred of the American way of life. There I’ve said it. The people you are voting for have no respect for who you are, and your position as a sovereign citizen of these United States.

Many people do not understand the notion of free enterprise. They believe that government needs to regulate business, and thereby protect the consumer. How about we let the consumer protect his, or her own interests. This would be accomplished by allowing a growing segment of business to offer product that is not scrutinized by some obnoxious government agency.

If the business is failing in the sense that it is promoting a safe and effective product, or a well made product then the consumer should be allowed to take action in a court of ‘common law’. That is not allowed today because the attorney’s who make the law want their share of the pie. The average Joe has to hire a lawyer, which costs, and then go into a court guided by procedures rather than justice.

In a court of ‘common law’ you should be allowed to present your case in clear and simple terms. The American people can see what is right or wrong, we don’t need an elaborate case to bring in front of jurors who should be able to recognize fraud when they see it.

Common sense, a good understanding of productivity and what made this country great is what we need. We don’t need thousands of lawyer’s speaking in tongues to promote justice through unconstitutional laws.

We need hard working machinists, carpenters, engineers, mechanics, and all of the folks that produced hard goods in this country. That is what made us great, and that is what will bring us back on the path to recovery.

I don’t have an MBA, but I can read the writing on the wall. We are in for one heck of a down turn from which we will not recover if we listen to Wall Street, the Congress, and the Courts. They are here for themselves, and their sole concern is the promotion of their own well-being.

‘Nick’