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Tom Britton

Director, Teacher, Language School

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To what extent are Americans worried about the fact that the Federal banking system is a private institution?

Is the privatisation of the Federal bank (to 10 stake holders) part of the American capitalist dream of freedom? To what extent does the general American public attribute the national debts of the U.S to abuses by the Federal bank? Is it abuse at all or is it in fact a justifiable part of American freedom? Do Americans think that it is, for any reason at all, justifiable to put a debt on every piece of currency that enters circulation? If the Federal bank was not a private institution, what would happen to America?

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Closing Statement from Tom Britton

Thanks to everyone for your input. I look forward to seeing how far the central bankers will go before the majority of the general public starts realising what is going. I suspect all of us lot will be long gone by then, if it ever happens.

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    Oct 16 2013: for those that care about the theory and history:

    Murray N. Rothbard: What Has Government Done to Our Money?

    available for free in pdf format: http://mises.org/money.asp
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      Oct 16 2013: Hi Kristían, thanks for the link. Does this material contain any information about the consequences of privatising the central banking system to profiteers?
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        Oct 16 2013: it contains information about how central banks in general destroy the economy, about why central banks can not come to life on a free market, about how the state created central bank in the US.
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          Oct 16 2013: and who, in your opinion, controls the central bank in the US? The government?
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        Oct 16 2013: wikipedia: "Board of Governors [...] are appointed by the President of the United States and confirmed by the Senate "
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          Oct 16 2013: I think it is a question of whether or not you believe the FED bank is governed by the president or not. I, for one, do not. We have the same situation in the bank of England and in the EU central banks. A central bank strangling the economy. Whether or not to have a central bank at all is another debate. Evidently, to have a truly free market economy, a central banking system is a no no. But a central banking system is what we´ve got, globally, and it isn´t about to go away.

          Kristian, presumably you are aware that presidents, over the last 100 years, have sold their power that they had over the bank in exchange for campaign funds? You are aware that the central bank has stake holders that run the state bank at profit, arguably with disregard for the common citizen?
        • Oct 20 2013: Thomas Jefferson believes there is no taxation without representation. While representation has been frugal and most people dont know who to point at, i do. There has really only been two worth mentioning for the past 30+ years. The Fed is a Board like Kris said, Alan Greenspan was the Head chair for many years, then Ben Bernanke. Both are extremely quick witted men. Both have been in office while a financial crisis threatened our livelihoods. Also Logic- Fed Speak was invented by Alan Greenspan as a way of dodging questions, in order to "keep stock holders confident" while they address the nation.
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        Oct 16 2013: you are arguing from two points of view at the same time. you say that the legal or formal status is relevant and you also say that it is not relevant.

        if you assume that big business controls formally government organizations, then what is the difference between "private" or "public" central banks? it does not matter. if this is the case, even the department of health or education is under private control.

        so what your point after all?
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          Oct 16 2013: I am not saying that it is irrelevant at all, what I am saying is that it is a separate point entirely and not included in the title of this "conversation".

          I´m under the impression that you think that the private sector is not exploiting the Federal bank. Am I right in thinking that?

          My point is that I want to know if Americans are concerned about the Federal bank being exploited by profiteers outside of the government. Obviously, exploitation exists outside and inside the government, so much so that the government and private sector is very blurry indeed. But essentially, the Fed bank isn´t federal at all. If it is the case that the central bank doesn´t even so much as function as a regulatory distributor of money, then the consequences could, potentially, be dire. Many have accused these top central bankers of orchestrating wars and keeping a minute percentage rich. This, as is explained in the link that you provided, is "hoarding". There are a massive range of issues that could seriously damage the entire planet if the Fed bank is in the hands of profiteers. Some more far out thinkers have even suggested that massive financial melt-downs have been designed by central banks and that this debt crisis in America is, at this very moment, part of a plan to bring more money and power to the central bank.
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        Oct 17 2013: oh, not at all. my point is that the FED is only called private, it is in fact a state organization. obviously it is hugely susceptible to bribing and serving big business. just as any state organization. but not because it is private. exactly because it is part of the government.

        if you follow the link i gave, you find out that banks for long tried to establish some FED like organization, but they couldn't. they sought help from the state. people at that time understood that it is a violation of everyone's rights. but in the course of a century, one small step after the other, they they succeeded. it is an unholy alliance. the state and the banks share the loot.
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          Oct 17 2013: Quite right. They share the loot but very little of the power which is still in the hands of the bank. But saying that the state shares the loot is somewhat of an over statement. The state pays a massive never ending price. I presume you meant that the fat cats skimming off the top inside the government share the loot.
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        Oct 17 2013: nope, the power is in the hands of the state. as i said, banks tried hard to establish something like the FED. they could not without the state. the state does not pay, they benefit. without the FED, the government have only one income: taxes. with the FED, they can inflate and they can borrow. at the end, the people pays for the party. but they don't see it. inflation and debt are insidious ways of taxation. the government couldn't care less if banks also make money. in fact, it is good, as they can get some of that too, as bribes.
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          Oct 17 2013: Do you think that the government still has more power than the Federal Bank?
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        Oct 17 2013: the fed is an arm of the government, one of the many
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          Oct 17 2013: Arguably, Roosevelt sold off what little power the government had over the Fed over a hundred years ago in exchange for campaign funds.
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      Oct 16 2013: Kris,
      Pat Gilbert has already beaten me up on my apparent disregard for Mises.org and their positions on monetary.
      policy.
      I am not happy with a central banking system. It has, is and will make a mess of the economy.
      But, we do away with it tomorrow, now what?
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        Oct 17 2013: the fed is just half the problem. the true root is fractional reserve. it is immoral and an obvious violation of contract. but with the help of rulers (kings first, governments later) it was legalized, and now it is so deeply part of banking, you look like tinfoil hat lunatic if you question it.
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          Oct 17 2013: I am not questioning your point, but if we didn't use the fractional reserve would there be enough money to cover all that is in play? I didn't look it up but it has to be in the trillions.
          The banking system is a mess and flim-flammery is all over, and we don't seem to punish the guilty.... but in reality, how else can a nation of over 300 mil pop and nearly $25 trillion in activity manage? Or am I asking the question beyond answer.
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        Oct 17 2013: The US constitution originally required the (United States Treasury) to exclusively issue new currency, not a (global banking cartel). The FED has become a (world wide shadow government) overriding the will of the people not just in the U.S. but everywhere, through the (World Bank) and (International Monetary Fund). They're destroying precious constitutional rights to self governance, and monetary control. The oligarchs, or robber barons of the early twentieth century created this mess, not a bunch of welfare queens looking for food stamps. The concept of fractional banking can be debated into eternity. Good, or bad it is the matter of ( degree ) to which fractionally is exercised that is at the heart of the problem. Fractional banking as practiced for centuries has created an overall inflationary oscillation, and upward spiral of money costs. Today it has become an out of control tool funding the grand casino for insanely wealthy hedge fund managers, and oligarchs who will stop at nothing to gain the sickening, pathological ,prestige of having the most toys, and the ability to abuse the most slaves. Thats you. and me by the way, the slaves I mean. The Fed is an abomination by any standard. Worse yet our congress a wholly owned subsidiary mouthpiece for the private Fed is selling the American people out to the highest bidder and most Americans sadly are to ignorant or confused to see it. If we simply read some treatises on the subject by Jefferson, Benjamin Franklin and hundreds of others who had the most intimate knowledge of currencies and banking that simply doesn't exist today we could save ourselves. But alas ignorance seems to be bliss.
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        Oct 17 2013: "would there be enough money to cover all that is in play?"

        what determines the price of a loaf of bread? how many loafs people offer and how much money people offer. the two meets somewhere. if we have fewer loafs, the price is higher. similarly, if we have fewer money, the "price" of money in terms of loafs will be higher. that is, more loaf for the same amount of money. that is, loaf is cheaper. it is perfectly logical. if there is more money out there, prices get higher accordingly.

        therefore, there is no "right" amount of money. prices adjust.
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          Oct 17 2013: Yes, in theory, but in the real world... we have seen hyperinflation and deflation. Neither is good.. There is a right amount of money... that amount which is not inflated or deflated in it's value. that being said, the US dollar has inflated 1000% in the last 50 years. That is an indictment of the Feds poor policies. I would say we need to redo the laws of 1913.

          What I can't see is the Treasury going into the banking business. I have watched the US Federal government get into health, education and welfare. We have more sick, illiterate, and more poor people then ever..
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        Oct 18 2013: hyperinflation of government managed paper money. that's the point. we need money that is fixed in amount, so nobody can inflate it. like gold, or some electronic money. or, free money. repel all legal tender laws, all laws making it more difficult to use alternative moneys, and see what people choose.
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          Oct 18 2013: I agree. There is a need to limit or fix the value of money in play. Right now the Fed can ask for money without any limit from the treasury.

          But, this conversation is about a central bank and do Americans care. I say, most don't care and I don;t know how a country this size could function with out a central bank..
        • Oct 20 2013: Well Kris, Gold Standard system was in place until the Feds found a better alternative to issuing currency. Where did the Gold go? It use to be on display and it belonged to every citizen of America holding a bank note.
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        Oct 18 2013: vice versa. the FED can create money, and the government "asks" them to do so. informally.

        how could it function: much better. government controlled inflation destroyed all moneys in existence so far. it is only a matter of time. romans managed to destroy even gold coins. you know, if a soldier shows up at your stand, and offers you a "gold" coin that does not even resemble gold, you tend to accept it. if another merchant tries this ...
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          Oct 18 2013: Not quite. Only the treasury can create money. the Feds can ask, but the President can refuse.
          Now the Fed does sell money to national banks and returns profits to the treasury.. Money is a commodity like oil or gold or.... wheat. As a commodity, it only holds value of what someone else will exchange for it.
          Too many people give money more credit then it is worth.
          I have enough money to meet my needs and at my age I have no wants. And there is the story. Too many people have a great list of wants and no means to exchange for those wants. They are all about money, who has it and how they can get it. Many ask the government to meet these wants for cash and the government complies by putting more money into play and is not the central banks problem, they get more to play with and the cheats get more to steal.
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        Oct 18 2013: i don't know where do you get your information from, but the FED is in charge with controlling the money supply. this is not up to debate.

        the government is of course the ultimate decision maker, but they control the money supply through the FED, which actually creates the new money.
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          Oct 18 2013: Kris,
          We are splitting hairs. The question are Americans concerned about the Central Bank and they are not. The mechanics of who what when and where are not really that important to most Americans, Banks are buildings on the corner of the street where you get home loans and credit cards.. They will give you a checking account and a money machine card. That is all most Americans know about banks and that is all they care.
          In America, There were three periods of time where we had a Central Bank. We are in the 3rd period. In the intervening times we had free banking more or less. It didn't work well during those periods/

          The US Central Banking systems is not working and the 1913 law needs serious
          remaking. .
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        Oct 18 2013: as i explained earlier, the fed is not the root of the problem. fractional reserve is. but without a central bank, inflation is limited and ends in a bank run. while with the fed, it leads to a never ending credit expansion which eventually destroys something, either the government or the economy.

        americans are not concerned. europeans neither. nor anyone basically. this is the true genius of the concept. how can you rob someone with the guy liking it?
        • Oct 20 2013: You are both right. Most people do not care about it. However, most people here that i have questioned have no footing in a discussion. I want to discuss facts with my teachers, friends, and family but i cannot because they have no facts about it. i find myself educating them, which i dont mind :)

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