Posts Tagged ‘Alistair Darling’

THE GREAT BANKING SCAM

November 20, 2008

Makes us all impoverished and enslaved to the banks

 

How’s this for a little gem of information then ?

“I’m afraid the ordinary citizen will not like to be told that banks can and  do create money. And they who control the credit of a nation direct the policy of governments and hold in the hollow of their hands the destiny of the people.”

 

Reginald Mckenna, past chairman of the Board of the Midlands Bank of England came up with this nasty little truth some long time before today’s credit crunch; and boy oh boy.  Just how right he was.

 

Because the banks can destroy money even faster than they create it in the first place – and that is exactly what they have just done over the entire World economy in just a few weeks recently.

 

That is why people are being made homeless and losing their jobs all over the World; why the whole fabric of society in Iceland is disintegrating and it’s citizens queuing in doleful lines for food handouts to stop previously middle class professional  families starving; people everywhere losing their savings and why we’re all going to have a lousy Christmas this year even if we don’t lose our job; because the entire World economy is going bust. This is because the sheer incompetence and greed of banks has paralysed the supply of money and is rapidly shrinking the total amount available for all of us to spend. 

 

Without the ability of all us to spend, businesses  go bust on an epic scale, putting more and more people out of work. This further reduces the amount of money which people would normally be spending at an ever faster and faster rate. A spiral of wanton destruction destroying millions of lives just because the banks are both incompetent and breathtakingly greedy.

 

They are so dishonest they cannot even trust each other. That is why they don’t want to lend to each other and why they now cannot find enough money to lend to businesses or anyone else. 

 

The financial system relies entirely on banks lending to each other and if they don’t, there is no financial system and there is no money at all. With no money business and trade simply cannot function, so ultimately no one  will have a job if the process is taken to its logical conclusion.

 

So, at a stroke, they are completely destroying the World economy as they close down ever increasing numbers of businesses and turn out hundreds of thousands, possibly millions of people, out of their homes and onto the streets.

 

Quite simply, the banks have destroyed everyone’s trust in money  and set about the process of destroying money itself and the only means of World trade.

 

Decades of building up wealth have vanished in an instant because greasy, immoral, devious thugs have somehow wormed their way into the banking system to wreak havoc with it as they made continuous increments towards ever increasing risks and constantly pushing at the boundaries of honesty and probity. 

 

That famous phrase ‘The Big Bang’ seems to spring effortlessly to mind. This was the phrase  used to describe the ’deregulation’ of banks. For ‘deregulation’ read ‘ be as dishonest as you can get away with’. It certainly turned out to be quite a bang, didn’t it ? The whole World economy is now going up in smoke.

 

There is no honesty or probity in banking anymore; just raw, savage, heartless greed. Banks are liars and thieves. There is no honour amongst liars and thieves. That is why the banks know they cannot trust each other and so it is why they are now so reluctant to lend to each other.

 

As about 95% of all the money in circulation is apparently created by banks during their process of taking deposits and then making loans, this means they are just as capable of destroying 95% of all the money in circulation if they continue to be as greedy and stupid as they have been in the recent past.

 

This is how the great banking scam works.

 

There is something called a fractional reserve ratio. It is a neat little conjuring trick, conjured out of thin air by the bankers getting together in a huddle with the government in the past to persuade it to pass a law saying banks could lend many times the amount of money actually deposited as savings.

 

A fractional reserve ratio of 9:1 allows  banks to create and lend £100 000 from a deposit of only £1 111.12p – an actual multiple of nearly one hundred times the original sum as the money is lent and re-lent at a diminishing amount of nine times the deposit sum each time; gradually diminishing to ever smaller sums before aggregating at about one hundred times the original sum. At 6% interest this provides the bank with £6 000 annual interest income which is roughly six times the original deposit of £1 111.12.

 

At 18:1 it would be twice the amount or £12 000 income for the bank from just £1 111.12p deposited.

 

The need for deposits from savers is entirely dispensed with when the bank or mortgage company charges a loan ‘arrangement’ fee. This fee simply allows the bank to conjure up the complete amount of your loan or mortgage from thin air without the tedious business of the bank having to be in possession of a single penny in the form of a deposit in the  first place. Effectively, by paying your ‘arrangement fee’ up front, you are simply creating your own loan or mortgage out of absolutely nothing !

 

It seems rather a pity we have to bother with doing it via the bank instead of just creating how ever much money we want to spend ourselves. It really wouldn’t be any different – except there wouldn’t be a nasty, grasping bank to repossess your property if you failed to make the repayments on time !

 

How’s that for a financial conjuring trick then ?

 

Some banks and mortgage companies have recently been rumoured to use fractional reserve ratios of up to 40:1. This would mean that for every £1 111.12p in cash they get their hands on, they can lend £400  000 , earning £24 000  a year in interest at 6%. 

 

But of course the interest rate is often a great deal more. In the case of credit cards it might be 30%, for instance. Hmm. That would make an annual income of £120 000 for the bank from just one single deposit of £1111.12p then. Nice little earner, isn’t it ? 

 

You could say it is just a teeny, weeny bit excessive. 

 

Just for the avoidance of any doubt  whatsoever, that translates into immoral and dishonest, which in turn really translates into a form of theft. You might call it conversion really; whereby the bank dishonestly converts honest savings from customers into entirely dishonest and misrepresented and risky loans which have now put the entire World economy at risk and threaten all with imminent recession and poverty.

 

So, when you pay your mortgage company £1 111.12 as a mortgage ‘arrangement’ fee, they might lend you just £200 000 and then have another £200 000 left over to lend someone else – or possibly pay themselves a large bonus instead, what ho ! Good little wheeze, don’t you  think ?

 

How else do you think all those meaninglessly huge sums of money sprung into existence from nothing – along with all those gigantically huge banker’s bonuses running into billions of pounds ?. 

 

Why, the bankers simply  realised they could conjure up as much money as they liked and spend it how they liked because they had complete control over it and virtually no one else understood how the whole thing worked.

 

Now we are all paying for their dishonesty and misrepresentation as our lives disintegrate around us. It’s about time our Government rounded all the bankers up and shot the lot of them. They are worthless fraudsters.

 

I came across this interesting observation by the Credit Manager of the Federal Reserve Bank, Atlanta, Georgia, USA,  Robert H. Hemphill  in a film called ‘Money as debt’.  

 

“Individual debts paid off leave individuals with more money. All debts paid off leaves society with no money at all. So there it is, we’re totally dependent on continually renewed bank credit for there to be any money in existence. No loans, no money.

 

“This is what happened in the great depression as the money supply shrank drastically as the supply of loans  dried up.

 

“This is a staggering thought. We are completely dependent on the commercial banks. Someone has to borrow every pound we have in circulation, cash or credit.

 

“If the banks create ample synthetic money we are prosperous; if not we starve.

 

“We are absolutely without a permanent money system. When one gets a complete grasp of the picture, the tragic absurdity of our hopeless position is almost incredible. But there it is”.

 

 

 

 

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