That was a very good video Jones. Good find!
As I watched the video, 2 things came to mind. First was the banking system itself and what is known as
Fractional Reserve banking. At the Wiki link, the best and easiest understanding for most people to grasp is found in the section entitled History and how the old gold and silversmiths use to create what were once known as Promissory notes. This premise is why also on your dollar bill it sez "Federal Reserve NOTE". But a true pormissory note requires 4 major elements to be a valid note at law.
1) A payor
2) A redeemer
3) An amount
4) A due date
Federal Reserve Notes otherwise known a FRNs initially had this when our money was gold and silver backed. The payor was the Fed. or US Treasury, the redeemer was the person holding the note for redeeming, the amout was the face amount on the note and the due date was when presented. Here's a 1928' Federal Reserve Note that meets all the conditions of being a true promissory note.
But such type money presented a major problem for both bank and State. For the bank, it created a limiting factor on debt creation (profit limits) and for the State itself, it's means of operation were confined to raising money mostly by taxation alone and not via the magic of debt creation (an the hidden taxation of inflation) as we see today. By erasing this limits on our money, both the bank and the State benefit from this relationship as the State avoids a pay as you go system and the banks via debt creation can increase profit potentials to almost endless levels until the inflated dollars become worthless in value.
Under a limited economic system say for example of gold and silver backed, there was always a kind of value ceiling that kept prices low and in order for goods and services to move about, the pressure was on downward pricing instead of a continuos upward pricing as we've seen in America since 1933' when FDR outlawed gold and then the nail in the coffin in 1971' when Nixon closed the gold window for good. Both national debt, private debt and inflation have risen in lock step in ever growing rates and at the same time, these false economies as the video shows come into play.
OK, the 2nd part in this deal is the State itself and we kinda covered some of those benefits above but here's the real kicker IMO. People scream that banks and Wall Street aren't regulated and that is absolute bogus on it's face. The real problem is gov't policy creating a false economic driving people towards these markets but that's another story in itself. The real problem is the very regulated agencies overseeing these operations are in a catch 22. First, this bureaucracy is a completely false picture in that the very thing regulated in truth does and always has controlled that which regulates it. Just look as the principle enforcement officer of our economy in the Sec. of Treasury and how many of them no matter the party in power come right from Wall Street or Big Banking itself. If a major UPS manager was made Sec. of Transportation, is there anyone here who wouldn't expect some favorable outcomes in law for UPS? Then why are we blind when gov't picks a banker or wall street person to run our economy and it seems only Wall Street or Banks end up winning? I know that sounds a bit popularist simplism but there is a bit of truth in that.
The State now on the one hand must regulate this major entity that has "STATE PLANNED" control over the economy but at the same time, this industry is also a major tax resource in both corp. and capital gains taxation collected for the State itself. As I watched the video, a background thought to all those money making processes was the profits and then the State revenue derived from those profits. So on the one hand, the State has a
real money maker but on the otherhand they have a regulator interest. And in a political environment where gov't is spending huge sums of money and increasing ever growing debt levels, what are the chances they spank
that money maker to correct it's bad ways? The answer is those 2 infamous cowpokes named "Slim & None!"
Now after the hit & run crime has been committed, we want to in effect give the bad driver a better car in which to advance his list of victims via the so-called gov't regulatory oversight. These gangsters if you will have used gov't and the bureaucratic process to cartelize and monopolize the market place and our answer is to just give them more as they cry their plea!
PLEZ! PLEZ! Brer Fox, what ever you do, don't throw me in the briar patch!
Everytime we throw Brer Rabbit in the regulated Briar patch he always gets loose to do more damage because we've yet to realize he created the briar patch and actually lives there. Instead of gov't planning an economy around itself like some business plan, it should step back, vastly downsize itself and even let Wall Street and banking become a wide open wild west. Yep, you heard me. Let that sucker go in whatever way it wants to go by removing all gov't sanction and oversight but at the same time kill it's monopoly status on the economy and let Americans themselves create there own economies as they see fit and to their own needs. I'd bet in short order, the whole Wall street/Banking cartel (a false market in itself) would almost vanish as only the badest gunfighters would enter Wall Street and then they'd just be killing each other and the rest of us would just avoid that part of town anyway. Did you ever ask yourself why is it that the average person can't go directly to a company and buy their stock from them rather than the Wall Street middle man? Who gave Wall Street that monopoly power in the first place?
What happened to a buyer and seller working directly without some gov't sanctioned middle man? Funny how some people still actually call this monopolized practice laissez faire, free market economics!
The video is very much correct on what happened but to overlook the State itself in all of this and how the State helps to actually forment this problem will only lead to the problem coming back again & again & again and each time it will be worse and worse and worse!
Here's something to also think about if you truly believe in helping the poor and the working man. A question was posed on
Yahoo Answers about what someone should do with $100kand the quick answer was to buy gold and that's fine. But a further explaination was given and you can find historical data to back this up all over yahoo and google searches. Here's the answer.
in 1920 a U.S. bill 20$ would buy you a good suit and a great tie.
in 1920 an ounce of GOLD would buy you a good suit and a great tie..
in 2008 a U.S. bill 20$ would barely buy you a decent tie.
in 2008 an ounce of GOLD would buy you a suit, a tie, a little dress for your wife, and supper for both of you just before you go to a nice hotel for the night.
Now why would that ounce of gold piece go further today than in 1920'? Because look at the advancements in production efficency, worker productivity and product advancements themselves. In a specie backed economy, the consumer, the poor, the worker profit from the economy as this is the true supply side, trickle down economics working for the good of the common man but the Reagan republicans backstabbed on their deal to return to gold and silver backed monies and thus the heart of this concept died before it even got started. Just a footnote on comparing a $20 gold piece to an ounce of gold. A dollar of gold is 24.75 grains in weight and multiply 24.75 x 20 = 495.00 Because coinage has a small element of other alloy, the 495 is not all gold but a true Troy oz. is 480 grains in measure so the $20 dollar gold piece by weight is a troy ounce in gold so the comparison of $20 1920' gold coin to an ounce today is a equal comparison.
With a fiat currency economy with fractional reserve banking, the poor, the common man lose everytime and the winners are the State and big Business itself via the banking monopoly as they get first dibs on new money and we working types and the poor get it way after the fact after inflation has already eroded it's value. Even Bush's TARP deal and Obama's stimulus will do the same as preferred customers of each adminstration will get the money first when it has it's highest value. We poor smucks come later!
Maybe it's time we realize and admit that even
Hitler Was a Keynesian!