''Our Banking Systems'' Are Legalised Fraud, Run By A Few, For Themselves. |Knowledge is Power

Lending something you don't have was recognised as fraud, and the cause of economic disasters, in the 1600s. The goldsmiths who loaned what they didn't have, bought our governments. Now they're banks.

****THIS IS A DRAFT!*****. This is a preliminary draft of my full article on Substack. If it interests you, you will find more information, better structured, on Substack as I continue to refine it.

I will be developing this in different directions. This is the origins

Lending money you don't have was recognised as fraud which causes economic disasters, in the 1600s. Then, fraudsters bought our governments. Now it’s called “creation of money”. And still we are deceived and fleeced by it.

Fraud is often called a “confidence trick”.

That’s what money is.

Yeah, everyone knows that?

We think it’s legit, because our government prints and coins it; unlike Bitcoin, which is made up by faceless private entities, for their own profit.

What most people don’t know, is that 98% of money is created even less legitimately than bitcoin: it’s some faceless person in a shady organisation, creating a “loan” out of nothing, for their own profit. “Money” that people can buy real things with, is created by a computer entry of a loan.

It doesn’t exist before that.

When repaid, it ceases to exist again.

In the meantime the lender has received money - called interest - for nothing.

For a computer entry.

It used to be for a line of writing on a piece of paper. Now, it’s not even that.

Can you loan nothing?

Can you loan something that doesn’t exist?

Why can some people make something up out of thin air, and get real wealth — properties, businesses from which they get wealth from other people’s work, etc — from lending it out, when no one else can?

The concept of creating credit by lending is a useful one. It enables people without money who have ideas, to start or improve ventures which create wealth and progress. From someone wanting to start a clothing venture or cafe from nothing but their own talent, to the creation and development of infrastructure such as water, power, communications, transport and sanitation which advance societies as a whole.

It prevents the haves from shutting out the have nots. It enables competition. Ironically it is the foil of capitalism: which leads inevitably to monopolies, the biggest, meanest fish consuming all competitors, aimed towards extraction rather than production of wealth.

The problem is, that the concept of allowing a few individuals or entities, appointed by “birthright” or cronyism, to enrich themselves by profit from creation of money, or lending nothing, distorts the entire structure of society. You might be able to vote for representatives, but they control them by threats — which we see in the “rich” countries, or if their threats are not bowed to, by destruction — as we see in the poor, socialist countries of the world.

Of course the banking privileged enlist the industries they control - through finance - politicians, insurance, media etc.

Hence the destruction of the Greensill Australian attempt to enter the business:

What is the solution then?

The discredited idea that governments, responsible to the people, should be the only entities able to create money, for the public good. Banks can lend money which governments create, for interest. But not lend nothing for interest.

I remember hazily a political party called “Social Credit” in my country. I was told it was a looney party that had some weird idea about money. That put me off ever looking at them. Later, being a low information voter (working long hours setting up in my own legal practice, with no time left except for debriefing on the Veuve) the Alliance Party was voted into coalition power - and Kiwibank, our first ever government owned commercial bank (aka money creator) was started up.

New Zealand needs to be educated on the banking system.

“Banking” is legalised fraud

Do you know who controls the money supply? Or what the “independent” reserve bank, (that is controlled by revolving door commercial bankers), does?

Here’‘s a simple banking 101:

The money supply is controlled by privately owned commercial banks, who get interest off creating money out of nothing. They are a plutocracy which controls governments and limits new entrants. Their aim is

Governments then borrow from them, and choose, rather than creating money, to pay interest to them as well.

Here’s an alternative scenario. What governments could be doing.

The “independent” central bank creates money when the privately owned banks create so much credit that the market crashes, because their borrowers default, they don’t have any cash or assets to pay the people who have deposited their money with them for safekeeping.

Everyone loses, all the time, except the private commercial banks. Depositors lose their savings. They can’t pay creditors or buy things to keep the businesses alive. The businesses can’t pay their creditors.

The bankers oligarchy are laughing all the way to the bank. Oh, They are already there.

“Banking” started as goldsmiths fraudulently lending out gold that people had left with them for safekeeping, (instead of using the gold itself, they gave written promises to deliver that gold — later called bank notes, bills of exchange and cheques).

The borrowers agreed to pay them back more than the amount lent - called interest - so the goldsmiths were pocketing the profit from promising to deliver gold that was not theirs.

Then they started lending the same gold multiple times at the same time - in other words, not just lending what they didn’t own, but lending what didn’t exist.

It was recognised in the 1600s that lending non-existent gold for profit was fraud (see our Crimes Act definition), and of course inevitably caused disaster for the owner of the gold, and the creditors of the borrowers, who had passed those promises to pay to others) when multiple goldsmiths’ promises to pay were called up at the same time.

(They lent in reliance that the whole amounts were not usually called up in full at the same time. But once lending got too great, that changed.)

But the Kings and merchants were the biggest beneficiaries of borrowing from the goldsmiths, and were in turn using the promises of the hapless depositors’ gold for their own profit (receiving stolen goods), they did nothing about it. Thus the owners of the gold, and the people who provided goods and services to the borrowers for the empty promises, were left with nothing, while the goldsmiths and the borrowers kept their profits, becoming ever richer and more powerful.

And because there was no democracy then, the concept that such credit could be created responsibly for the public good - enabling development without crashes - rather than private profit — didn’t occur to anyone who had power.

This was called f.r.a.u.d. in the 1600s when goldsmiths lent out gold that people had left with them for safekeeping, without the consent of the owners. Instead of delivering the gold, they gave promises to pay, multiple times over for the same gold. Leading to the boom and bust cycle, where the goldsmiths ended up with all the interest, while the depositors and the borrowers, and their creditors, were repeatedly ruined.

Until 1848 when the UK Parliament passed the farcical

So the fraudsters basically bought the governments, and the fraud was bowdlerised to “creation of money”. And later on when they crashed, instead of taking their assets and businesses which happens to anyone else, they persuaded governments to bail them out with taxes paid by the people the had ruined. Enabling them to continue their aggregation of the wealth produced by people.

Of course, they controlled everyone’s livelihoods including the media’s. So movements such as Social Credit, for the creation of money to be controlled by the government instead of the private bankers’/business cabal, were discredited and people never learned the truth.

By the time universal human rights and the right to national sovereignty were created by the United Nations in 1945¹, the bankers had come up with a far better idea: to replace colonialism by military force, with economic colonialism, odious debt and vulture capitalism. Thus the IMF and World Bank came into being². Both controlled solely by the United States of America.

So now, an oligarchy of banks create money for their own profit, and our governments literally give them the money they have lent if they are unable to pay, because they lend so much that they can’t honour their promises. We haven’t come far, have we.

New Zealand has a fascinating history of groups which understood this and tried reform it, but were discredited by the governments and media which of course are “owned” by (dependent on) those very banks. The only thing they did achieve was the creation of Kiwibank, which at least offered some competition to We deserve to understand why we are having this done to us, who is doing it, and how it is taking our wealth - and a reasoned assessment of the alternatives. for growth and inflation control. Please include Richard Murphy and Gary Stevenson’s alternative proposals.

Further watching:

1. Sovereignty: by the United Nations Charter: https://www.un.org/en/about-us/un-charter/chapter-1

Human rights: The United Nations Declaration of Universal Human Rights: https://www.un.org/en/about-us/universal-declaration-of-human-rights

2. To be covered in a separate substack. In the meantime: