The Monetary Crisis XIV

seven steps to prepare myself for the monetary crisis

jwr1947

The first step is the hardest (1 Minute)

Only a few people ever invested a few days to understand modern banking systems, which are key elements in prosperity and wealth. To even shorten these few days we don't have to invest more than one minute to understand the fundamental principle, which has been formulated by the Rothschild brothers of London writing to associates in New York, 18631: The few who understand the system will either: be so interested in its profits or be so dependent upon its favors that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests. That is: basically banking business is based on ignorance of the masses. If you belong to these masses you may step back and go on living in ignorance.

The second step is harder than the first

Of course I did not accept the statement as it is and decided to dig deeper. The second step is to understand how it works. Reading the publications of the Board of Governors of the Federal Reserve System did not really help because the principle is explained, but not its risks and the basic problems for the future. Officials will only explain historical facts and the current status. If you read the newspapers the future however seems to be at risk. In fact the Federal reserved in not federal at all. It turns out to largely be owned by private bankers, who are still hiding the system against unveiling the principle and the risks. In order to find out the basics and the fundamental risks I needed to invest some more time.

The third step is illuminating (30 minutes)

Ultimately I found 5 YouTube-videos in which Ellen Brown explains these principles adequately within approximately 30 minutes. Web of Debt - Ellen Brown - 1 of 5 Web of Debt - Ellen Brown - 2 of 5 Web of Debt - Ellen Brown - 3 of 5 Web of Debt - Ellen Brown - 4 of 5 Web of Debt - Ellen Brown - 5 of 5

1 Famous Quotations on Banking from The Money Masters - How Banks Create 90% of the World's Money

Ellen Brown explains the base monetary system as to be based on the empirical observation that statistically 10% of the money deposited in a bank may be withdrawn, whereas 90% remains deposited in bank accounts and (probably) never is expected to leave the banking system. If cleverly used as a reserve these loans may be used to generate more money by a multiplication factor depending on the reserve rate. At a reserve rate of 10% the multiplication factor may be increased to 97%.

Fig. 1: The expansion of $100 through fractional-reserve lending at varying rates.

Source Money Multiplier - transferred to Wikipedia Commons by User:Sreejithk2000

The total amount of money is explained as to consist of: 3% solid coins, dollars banknotes and checking account balances (M1). This is the monetary base or total currency, from which other forms of money (like checking deposits, listed below) are created and is traditionally the most liquid measure of the money supply. Bank reserves are not included in M1. 97% of virtual money, explained as electronically generated money, existing in banking circuits only. M3 represents money, "close substitutes" for money plus large and long-term deposits. Since 2006, M3 is no longer tracked by the US central bank.

The M3/M1 percentage may be expressed in a money multiplier-factor. These 5 videos have been uploaded in January 01.2009 and although they clearly explain things the system meltdown has been proceeding for some years, in which some more evidence has been added. The banking system based on credits has been working for 300 years. Has the meltdown been expanding, braked or stopped ever since? What happened to the expansion and the multiplier factor? I needed to make another step.

The fourth step is a Warning

From Wikipedia the proceeding of the meltdown may be expressed in clear numbers: As of November 17, 2011 the Federal Reserve reported that the U.S. dollar monetary base is $2,150,000,000,000. This is an increase of 28% in 2 years. The monetary base is only one component of money supply, however. M2, the broadest measure of money supply, has increased from approximately $8.48 trillion to $9.61 trillion from November 2009 to October 2011, the latest month-data available. This is a 2-year increase in U.S. M2 of approximately 12.9%. That is: in fact none of Ellen Brown's suggested activities 2 worked. The meltdown is proceeding. Obviously the control system is out of control.

The fourth step is an Analysis

I studied the risks for my own financial position. Obviously the largest part of the money supply (M2) is located in the banking business. These supplies also include all my pension funds, insurances, bank accounts, certificates and other deposits. In the case of a monetary collapse these deposits would be lost. If the banks and their computers would be deactivated the system would be deprived of 97% of the global assets. These accounts of generated money (defined as bank money) would be lost and the global assets would be reduced to 3% of the current monetary base (M0). In monetary base it is explained: The monetary base is called high-powered because an increase in the monetary base (M0) can result in a much larger increase in the supply of bank money, an effect often referred to as the money multiplier. An increase of 1 billion currency units in the monetary base will allow (and often be correlated to) an increase of several billion units of "bank money". This is often discussed in conjunction with fractional-reserve banking banking systems. A system of full-reserve banking would not allow for an increase of currency in the banking system on top of the monetary base. Following the recent financial crisis, proposals for the restoration of full-reserve banking have been made by various economists. However, proposals for full-reserve banking are generally ignored by mainstream economists3. If the meltdown proceeds and/or even accelerates the system will end up in a crash, which in a number of locally limited areas already has been observed. A crash in a leading global currencies however will be felt in every corner of the planet. Some kind of protection is needed for each individual citizen.

2 Ellen Brown suggested to switch to state-owned banks such as the BND in the nation. The Bank of North Dakota (BND) is the only state-owned bank in the nation. Their mission, is to promote agriculture, commerce, and industry in North Dakota. 3 Mainstream economists generally believe that the costs and inconvenience of full-reserve banking would outweigh any benefits. Since banks would not receive profits from lending out deposits, depositors would have to pay banks for keeping their money safe and providing checking and other banking services. Such a system would be difficult to implement and would likely be rejected by the public.

The fifth step is an Amortization

The crash will be concentrated in the banking system, where the bank money is located. These assets normally (statistically) hold 97% of everybody's assets. You do not need large amounts of cash money to pay for your bread, drinks and gasoline. Normally and statistically a wealthy person may for example hold a few hundred of cash money (say 500 US$) in his wallet, whereas his bank account may hold a 300-fold deposit (say 150.000 US$). Furthermore he may own his own house (representing a value of say: 150.000 US$). The house may have been amortized or still financed by a adjustable-rate mortgage or by a fixed-rate mortgage. If your house has been amortized you own your house and may comfortable. If you haven't paid your loan the house may be in danger if you cannot pay the mortgage payment. These risks increase in eras of high inflation. Unless you have a 30-year long fixed-rate mortgage with a minimal interest rate the first step should be to get rid of the adjustable-rate loans, which may kill you as soon as a hyperinflation really starts. Having paid for your house you may have saved 50% of your direct assets. However there are still some risk you may lose this component. In emergency cases the state will directly load a (new) forced mortgage (say 10% of the current value) on your house. This is a direct tax for all owners of real estate property, which has been applied in several states. In Germany forced mortgages have been applied in 1923 and 19484. In order to prepare these taxes the state already organized an appropriate census in 2011. The state will merely need a mouse-click to send all German homeowners to send them bills for their enforced mortgages. This probably raises more than 900 billion Euros, although it would not solve the problems. It merely helps to pay for the Greek debts (approximately 350-380 billion Euros) and (say) a minor part of Italian's debt 2,113 billion US$5. If you ever planned to buy several houses you will have to consider a series of forced mortgages, which all will have to be served. Also the the state may repeat the system of forced mortgages, or increase the 10% amount to 25%. In developing of ideas the phantasy is unlimited and taxes may be posed on anything that is registered and may be located somewhere. Your house should be amortized as soon as possible, but you will need some real money to pay the 15.000 US$ forced mortgage in case the bank accounts get lost in a monetary collapse. Otherwise you will lose your home. To save your own home from deprivation you will need some emergency cash, which cannot be located easily.

The sixth step is a physical money deposit

After a collapse of the banking system you will not have access to any bank accounts, but you will have to pay your forced mortgage anyway. Usually it is not a good idea to go to your bank and take your bank deposits (say 150.000 US$) and save them at home in a drawer. It might be too dangerous. Of course you may go into the woods and bury the cash somewhere beneath a large oak. You may sketch the location and deposit a description of the exact location in a bank safe, just in case you get lost in the coming turbulence and you want to transfer your assets to your loved ones. You might buy some physical gold to pay your taxes and keep it in a safe place. An amount of 15.000 25.000 US$ in gold represents approximately10-20 ounces in. In order to compensate for the volatility of courses you might need the double amount, say 20-40 ounces respectively coins.
4 Sources: Zwangshypothek and Zwangshypotheken im Anmarsch ? 5 Source: government debt

The seventh step is an extra reserve deposit

Having paid for your 150.000 US$-house and reserved a 30,000 US$-gold deposit for extra taxes you must consider the idea of converting the remaining 120.000 US$-bank account in real money. In case of a collapse you will need some extra reserve deposit for living. You probably will not prefer real estate for these are expensive in turbulent times and may be loaded with excessive forced mortgages. Most investments in stock probably are not very attractive as most stock may belong to the assets which are prone to heavy losses in case of a monetary collapse.

You might consider to convert the rest of your bank account into physical gold, but your gold largely may be confiscated by the state, e.g. by buying it at an official standard price for 35$ / ounce. Confiscations of gold have been recorded in 1933. Under current federal law, gold bullion can be confiscated by the federal government in times of national crisis 6. Most governments have prepared themselves for taxes and confiscations by reporting mechanisms for some voluminous gold and other monetary transactions. You might consider to partially transfer your money from a bank account into a safer deposit, such as commodities such as precious artwork, precious paintings, diamonds, old coins or antiquities. This last step however is easier than the preceding steps. You may take some more time and wait for a while until the breakdown is coming nearer. You may wait for another manipulation phase in which the market for gold, silver or stock is dipping and the transactions are cheaper. Remember: even now only a few people understand modern banking systems, but you are amongst the illuminated insiders who have studied the Famous Quotations on Banking and the explanations given by some whistle-blowers.

Conclusion
The first step has been the hardest, as you realize you belonged to the masses who were mentally incapable of comprehending the tremendous advantage that capital derives from the system and will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests. In fact you and I already belong to the victims of the greatest fraud of all times, which has been initiated 1694 by the Bank of England7. The fraud lasted for 300 years. Some monetary experts claim it (therefore) may last for another century. That remains to be proved, but I think it may as well merely last 300 days or another 300 hours. The system in out of control and may explode any day now. After 7 steps you have experienced astonishment, fear, and anger but now you know what may be happening soon, tomorrow, this night or perhaps in 10 or 100 years - if we are lucky. Now you are able to take your precautions, which may be executed in a few steps. Don't say you haven't been warned if your accounts get lost8. As usual these notes are my own remarks and opinion, based on private investigations without any guarantee for correctness.

6 Avoiding Gold Confiscation 7 Web of Debt - Ellen Brown - 3 of 5 8 And don't blame me for warning. It has been said many times before.