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Mark Spitznagel Asks "Wouldn't We Be Better Off Without Central Banks?"

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Submitted by Mark Spitznagel via Institutional Investor,

Happy 100th Birthday, Federal Reserve - Now, Please Go Away

Nearly 100 years ago, on December 23, 1913, the Federal Reserve Act was signed into law, giving the U.S. exactly what it didn’t need: a central bank. Many people simply assume that modern nations must have a central bank, just as they must have international airports and high-speed Internet. Yet Americans had gone without one since the 1836 expiration of the charter of the Second Bank of the United States, which Andrew Jackson famously refused to renew. Not to be a party pooper, but as this dubious anniversary is observed, we should ask ourselves, Has the Fed been friend or foe to growth and prosperity?

According to the standard historical narrative, America learned a painful lesson in the Panic of 1907, that a “lender of last resort” was necessary, lest the financial sector be in thrall to the mercies of private capitalists like J.P. Morgan. A central bank — the Federal Reserve — was supposed to provide an elastic currency that would expand and contract with the needs of trade and that could rescue solvent but illiquid firms by providing liquidity when other institutions couldn’t or wouldn’t. If that’s the case, then the Fed has obviously failed in its mission of preventing crippling financial panics. The early years of the Great Depression — commencing with a stock market crash that arrived 15 years after the Fed opened its doors — saw far more turmoil than anything in the pre-Fed days, with some 4,000 commercial banks failing in 1933 alone.

A typical defense acknowledges that the Fed botched its job during the Great Depression, but once the wise regulations of the New Deal were put into place, and academic economists realized just what had gone wrong during the 1930s, it was relatively smooth sailing from that point forward. It would be silly, these apologists argue, to question the advantage of central banking now that we have learned so many painful lessons from experience, which Fed officials take into account when making policy decisions.

What about the excruciating pain of the recent past, dubbed the Great Recession of 2008 and 2009? In the five years from 2008 to 2012, almost 500 banks failed. What would history need to look like for people to agree that the Fed has not done its job?

But wait! The Fed is necessary to the promotion of stable economic growth — or so the conventional wisdom says. The idea is that without a central bank, the economy would be plagued by wildly oscillating business cycles. The only hope is a countercyclical policy of raising interest rates to cool an overheating boom, and then slashing rates to turn up the flame during a bust.

In actuality, the Fed’s modus operandi has been to trick capitalists into doing things that are not aligned with economic reality. For example, the Fed creates the illusion, through artificially low interest rates, that there are both higher savings and higher consumption, and thus all assets should be worth more (making their holders invest and spend more — can you say bubble?). The perpetuation of this trickery only delays the market’s eventual, and often precipitate, return to reality.

Many economists now recognize that the massive housing bubble of the early and mid-2000s was caused by the artificially low interest rate approach of Alan Greenspan’s Fed, enacted in response to the dot-com crash (itself the ostensible result of artificially low rates). At the time, this was viewed as textbook pro-growth monetary policy: The economy (allegedly) needed a shot in the arm to get consumers and businesses spending again, especially after the 9/11 attacks.

It appears those textbooks are wrong. Economists George Selgin, William Lastrapes, and Lawrence White analyzed the Fed’s record and found that even focusing on the post–World War II era, it is not clear that the Fed has provided more economic stability when compared with the pre-Fed regime, which was characterized by the national banking system. The authors concluded that “the need for a systematic exploration of alternatives to the established monetary system is as pressing today as it was a century ago.”

In other sectors, we don’t normally defer to a committee of a dozen experts to set prices. Yet this is what the Fed does with its Open Market Committee, which routinely sets a target for the federal funds rate as well as other objectives. If we all agree that central planning and price-fixing don’t work for computers and oil, why would we expect them to bring us stability in money and banking?op09

On this, the 100th birthday of the Fed, it’s time to ask ourselves: Wouldn’t we be better off without a central bank?


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Tue, 12/24/2013 - 15:04 | 4273712 VD
VD's picture

"In other sectors, we don’t normally defer to a committee of a dozen experts to set prices."


It's ACTUALLY LESS in other sectors; e.g. MEDIA (6 constitutes the collusive oligopolgy in that sector).


Tue, 12/24/2013 - 15:25 | 4273751 CH1
CH1's picture

Wouldn't we be better off without central banks?

Is that a trick question?


Tue, 12/24/2013 - 16:52 | 4273919 nightshiftsucks
nightshiftsucks's picture

And fuck whoever down arrowed you,probably some stupid fuck in Obummers army.

Tue, 12/24/2013 - 17:26 | 4273978 Pegasus Muse
Pegasus Muse's picture

December 23, 1913, a day that will live in infamy.  The day Princeston Professor Woodrow Wilson betrayed America and the American People by selling them out to the New York Banskter Mafioso to repay them for their financial support during his presidential campaign.  It's been downhill for the nation ever since. 

Woodrow Wilson was elected President in 1913, beating incumbent William Howard Taft, who had vowed to veto legislation establishing a central bank. One year earlier, in 1912, Wilson was brought to Democratic Party headquarters by Bernard Baruch, a conspiring banker mogul. Here Wilson agreed to a deal with the devils in exchange for political and financial support from the Rockefeller-Morgan bankers. Wilson swore in secret that if elected President, he would support the banker's Federal Reserve scam and push for the first ever progressive income tax on the American people.


Tue, 12/24/2013 - 17:37 | 4274013 Dugald
Dugald's picture

A little OT....But,

Any one stopped to think why CB's are so willing to sell gold cheaper than the average cost of production......It's very simple...

Think on this.....  if nearly all the gold is held by just two or three countries, then that takes care of any chance of going back to a gold standard.

Think the war gamers have not thought of this? nuke those gold vaults and that takes care of any gold standard for all time.

Its called the GOLDFINGER GAMBIT.....

Gold is a clear and present danger, its our patriotic duty to nuke it!!  Wait for the SPIN, its coming.........

Wed, 12/25/2013 - 01:47 | 4274660 Clowns on Acid
Clowns on Acid's picture

Yes... but they are all Cheesepopes....

Tue, 12/24/2013 - 15:08 | 4273716 DIgnified
DIgnified's picture

We need a concerted effort to find the owners.

Tue, 12/24/2013 - 15:19 | 4273737 El Vaquero
El Vaquero's picture

You bring the gasoline, I'll bring the marshmallows. 

Tue, 12/24/2013 - 15:19 | 4273742 Colonel Klink
Colonel Klink's picture

I'll bring the matches.  Can someone volunteer to bring the fiat to light them with?

Tue, 12/24/2013 - 15:25 | 4273750 zaphod
zaphod's picture

The fed will continue until the currency collapses and no one accepts dollars anymore.

This is an unfortunate solution, but it seems to be the only example of how any society has escaped government money in the past. Everyone has to collectively walk away.

Tue, 12/24/2013 - 15:43 | 4273785 DIgnified
DIgnified's picture

They wont let it happen unless theyre sure the can control the replacement.  That is the weak link, the transition.  

Tue, 12/24/2013 - 15:22 | 4273752 El Vaquero
El Vaquero's picture

We can wait until the 4th of July and be patriotic about it by using things like Roman Candles. 

Wed, 12/25/2013 - 05:27 | 4274748 Colonel Klink
Colonel Klink's picture

Sure we can call them Freedom candles instead.

Tue, 12/24/2013 - 15:12 | 4273723 TeamDepends
TeamDepends's picture

Dear Americans,

We now realize that over the last hundred years our economic policies have completely devastated you.  To rectify the situation, we have decided to drink ourselves to death this holiday season.  Merry Christmas,

The Fed

Tue, 12/24/2013 - 15:15 | 4273728 bozzy
bozzy's picture

Fork and dangle the lot.

We need very little of anything the banking system wants to provide be they central, investment or retail. Bring on the credit unions.

Tue, 12/24/2013 - 15:17 | 4273731 Colonel Klink
Colonel Klink's picture

According to all the charts on the value of the dollars purchasing power, YES!

Tue, 12/24/2013 - 15:18 | 4273735 kevinearick
kevinearick's picture

it really doesn't matter; you are always going to have to discount stupid...

Property Taxes & Education

Protecting other people’s children from life, making them economic slaves to the false assumption of the majority, that life is a threat to be insured against, is pretty f-ed up. Look at the data.

Trying to teach a group the same thing at the same time, placing all individuals in the same time, is like sending everyone to the same elevator at the same time to go to the same floor, resulting in artificial scarcity, and it’s no accident.

Scale economies are about stopping time, until they can’t. Legacy labor, capital, employs the middle class to stop time, its own natural replacement. That’s what all those artificial borders employed and “free” trade agreements to marginalize labor are all about, insulating the old families from new family formation. Capital amplifies its insecurity with the middle class, which has never effectively transformed capital, because it operates on the assumption that a job is work.

The middle class argues for more make-work accordingly, but doesn’t see the irony, because it is paid to chase capital, the past, with ever-more efficiency, always surprised to find itself further behind, and calling for more money, taxation on the price inflation of inert or misused real estate, to feed a school system that reinforces the process.

Naturally, capital’s gravitational education system teaches that work, economic slavery, is to be avoided, with education, group compliance, the competitive advantage of numbers. Economies, and computers, lock up because the participants are in the wrong place at the wrong time doing the wrong thing, in fear of moving lest they fall further behind in the queue, to labor, heaven forbid.

Then the graduates get all upset when they discover that I am making six figures to sit in a coffee shop, having a double, in case their latest and greatest, most efficient, elevator breaks down. And they blow up when I make them walk the stairs, the point of which is to see who walks up and how they navigate the process, with timing.

It costs me to show up to a make-work job, relative to much better things I can do with my time. Adjusted for monetary and fiscal policy, my wages are less than minimum wage. The US dollar is worth 2 cents. The same morons that bankrupted Detroit are buying it from China, with laundered dollars.

An economy is always being dismantled and an economy is always being built. How much materials costs depends upon what you are building. The old-timers can eliminate all the middle men for you at will, but they are not going to tell you what to build; that’s not their job.

From the perspective of the middle class, throwing my children into the black hole after only a year of training was crazy, as was giving away my property, money and jobs. What it doesn’t get is that I can walk across any town and be offered a piece of property, which no external income can support, before I get to other side, and my kids are better than me.

Government by deferred responsibility is in the business of ignorance proliferation, with increasingly complex misdirection in the form of securities, the fixed lottery of entitlement ponzi. Government preemption over individual responsibility is a complete and utter fraud.

If you leave everything you touch a little better than you found it, the majority government is dependent upon you, because all it can do is slow down time, temporarily. Merkel isn't a rocket scientist. What else can she do but form a coalition to "save" the pensions? There have always been individuals shirking responsibility. Put that gravity, off-sheet liabilities magically accounted as assets, to work.

Capital can collect all it wants, but it can’t do anything with its collection without you. The hedge fund managers were offering me property back in the 90s, for lack of private income generation, and look at them today, wards of the government. You can go along with the sh-show, or rebel against it, but don’t bother complaining to an old-timer that you have no opportunity.

Accepting stereotypes, like “the boomers,” in a divide and conquer system of reduction to nothing, is self destructive. I didn’t have to spend my time, and as you have seen, the majority not only cannot comprehend what I am talking about, but also feels the need to respond with opposition, with an irrational expectation of the Fed to prevail, while it pretends to rail against the Fed, which is feeding it manufactured food, beginning with a self serving definition of labor.

Educate your self, by learning to set your distance, to navigate. Only capital is going to give you a car, knowing that you will drive it off a cliff, to sell you on another, and tell you that you are energy restricted. The Fed printed, keeping its controlled labor constricted, and prices to its labor inflated, big surprise.

The data tells you that 24 hours is more than sufficient, and you have much better things to do with your time, like build a better world for your children. Assuming the universe is nothing more than stupid gravity isn’t going to get you off this rock.

Happy New Year

Tue, 12/24/2013 - 16:14 | 4273857 FreedomGuy
FreedomGuy's picture

I personally think we should rescue the horse and buggy industry. Look at the decline that has set in since the introduction of the Fed! Think of all the jobs lost in those industries! Where is your humanity when you show those who are displaced no concern for their uncertain futures? They were making a good living at this industry and the nation was dependent on them.

Good post, kevinearik.  I would add that the concept of "stability" runs hand in hand with your post. As with most government promises, they are lies or at least delusions. Central planning, control and stability all favor the current structures, those who are currently powerful, currently employed and will stop time or attempt to stop time if left to their own devices (as you state).

Rule of thumb for those who favor liberty: Do not empower others with your life, your fate. They run it to their own benefit.

Tue, 12/24/2013 - 19:05 | 4274207 401K of Dooom
401K of Dooom's picture

Kevinearick, here is how a liberal would respond to you:  But what about the children?  You can't leave them behind!  Your mean-spirited!

Tue, 12/24/2013 - 15:17 | 4273738 Loophole
Loophole's picture

Everything the Fed does results in the redistribution of real wealth, one way or another. Someone gets the money it creates or the benefit of it, and others get screwed because of the debasement of the currency and in other ways. We are forced to use the govt's fiat currency so they can accomplish this.

In other words, the Fed and it's supporters are just another bunch of GD thieves.

The idea that anything the Fed does "helps" the economy is inane at best and, really, downright fraud.

Tue, 12/24/2013 - 15:18 | 4273740 Peter Pan
Peter Pan's picture

The FED has been tilting the pinball machine for 100 years and getting away with it. For an organisation of over 20000 employees you really need to wonder what is they do.

Tue, 12/24/2013 - 15:23 | 4273756 El Vaquero
El Vaquero's picture

" really need to wonder what is they do."


Theft through a legalized ponzi scheme.  That's what they do. 

Tue, 12/24/2013 - 15:31 | 4273761 Peter Pan
Peter Pan's picture

Yes I know but with 20000 people in their offices I still wonder what they do. I mean even if they were running every bingo game in the country they still would not need 20000 people.

Tue, 12/24/2013 - 18:00 | 4274067 css1971
css1971's picture

I'm pretty sure that 99% of the 200,000 don't know what they do either.

Tue, 12/24/2013 - 16:02 | 4273821 nickels
nickels's picture

The Fed "encourages" people to do things that they otherwise wouldn't do. Similarly, a pirate "encourages" you to walk the plank by sticking a cutlass in your ribs.

Tue, 12/24/2013 - 18:01 | 4274065 css1971
css1971's picture

The size of the organisation legitimises what they do. Must be important.

Tue, 12/24/2013 - 15:24 | 4273753 quasimodo
quasimodo's picture

I read the headline to this story and thought to myself "Did Captain Obvious from the Bob and Tom show pen that"?

Tue, 12/24/2013 - 15:30 | 4273760 JailBank
JailBank's picture

If we don't have a FED how will we know what the fair market value of assets are?

Wed, 12/25/2013 - 01:45 | 4274659 Clowns on Acid
Clowns on Acid's picture

Well... first we stop the Fed from pulling prices from their ass....

Tue, 12/24/2013 - 15:30 | 4273762 ebworthen
ebworthen's picture

It's a rhetorical question, just like:

"Would you be better off without a tapeworm in your gut?"

Tue, 12/24/2013 - 15:37 | 4273771 kchrisc
kchrisc's picture

Banking, as in fractional reserve banking, is nothing more than theft by fraud.

Central, as in centralized power and violence to take, is the antithesis to Liberty--slavery.

So a central bank is a centralized institution of theft and slavery.

Now what was the question?!


"Happiness is a warm head in a basket."

Tue, 12/24/2013 - 15:41 | 4273774 TomGa
TomGa's picture

Heck, now even PBS is out saying publicly that the Fed is engaged in unsustainable illegalities....

PBS Drops a Bombshell on the Federal Reserve’s 100th Birthday Party

"PBS promised a “debate” this past Friday night on the “benefits and dangers” of the Federal Reserve as the Fed marks its 100 years of existence tomorrow. Instead of a debate, two famous stock market historians made the same stunning announcement – that the Fed has decided its job is to push up the stock market."


H/T Denninger

Tue, 12/24/2013 - 16:09 | 4273844 evokanivo
evokanivo's picture

No one watches PBS except those that are already disenfranchised. So ... why does this matter?

Tue, 12/24/2013 - 15:49 | 4273792 tony bonn
tony bonn's picture

the fed is a tool of the nazi banksters to controll money and is an evil satanic menace which should be obliterated into dust......yet its brutal private police force will not allow that....the fed rules by tyranny and answers only to itself....

Wed, 12/25/2013 - 01:43 | 4274658 Clowns on Acid
Clowns on Acid's picture

Nazi's.... are they the moneychangers...?

Tue, 12/24/2013 - 15:50 | 4273794 dick cheneys ghost
dick cheneys ghost's picture

To the owners of The FED........thanks for the debt slavery..........I think I'll buy a condo on Rothschilds Blvd in Tel Aviv where debt slavery is celebrated


''The Federal Reserve Banks are a privately owned consortium controlled by the eight major stock-holding families: The Rothschilds of England and Germany, Moses Seif of Italy, Lazard Freres of France, the Warburgs of Germany, Kuhn-Loeb of Germany, Goldman-Sachs of the United States, Lehman Brothers of the United States, and the Rockefellers of the United States. Only three of these families are American. This small group decides the fates of hundreds of millions of people by their financial policies and maneuvers. It was Baron Meyer Amschel Bauer Rothschild, (born in 1744 and died in 1812), who said, "Give me control over a nation's currency and I care not who makes its laws.”''

Tue, 12/24/2013 - 16:05 | 4273828 Colonel Klink
Colonel Klink's picture

May a curse be upon those families for great pain and suffering for all time.

Tue, 12/24/2013 - 16:22 | 4273863 dick cheneys ghost
dick cheneys ghost's picture

Klink, check out this PROPAGANDA piece......the bankers blaming greedy bankers on the commies's.......this really is the 'twilight zone'.......the banksters will never take the blame for the monetary system forced upon us in 1913....they will always blame it on someone else.....fuck me

''The anonymous circle of screenwriters targeted both the writers and the film itself. 'It's a Wonderful Life' and other films were targeted under a film regime designed by Ayn Rand, the 'Atlas Shrugged' writer who has become an icon for some libertarian conservatives in recent years, according to Aphelis.''

Tue, 12/24/2013 - 16:44 | 4273898 Colonel Klink
Colonel Klink's picture

The answer is to paint them with their crimes against humanity using their own blood.

Tue, 12/24/2013 - 15:48 | 4273796 dojufitz
dojufitz's picture

All things come to an end......the Fed will end.......everything comes and goes.....

Tue, 12/24/2013 - 16:06 | 4273831 mrdenis
mrdenis's picture

The Fed and my curtans have a great deal in common .....they both look great once their hung 

Tue, 12/24/2013 - 16:06 | 4273839 ramacers
ramacers's picture

forget better off/on for this/that, we need firing squads - lots of them!

Tue, 12/24/2013 - 16:14 | 4273858 Stuck on Zero
Stuck on Zero's picture

Just about the time that Americans decide we don't need a central bank the Central banksters will decide we need a Central Central Bank.


Tue, 12/24/2013 - 16:13 | 4273860 AynRandFan
AynRandFan's picture

The Fed's recent power grab is just the latest step in consolidation of power at the national level.  In Colorado, for example, the legislature spends most of its time passing laws to conform with the ever-increasing flow of regulations.  Colorado gave up its sovereignty long ago.  In Texas, where I live now, the legislature spends a lot of time passing its own laws and thumbing its nose at the Federal bureaucracy.  I like that.  People around here have a lot of yard displays repudiating Obama, like an empty chair perched up next to the fence along the highway.  Having recently moved from a co-dependent state, I fear for Texans when they realize the Federal government is importing South and Central America as fast as it can in order to overwhelm the electorate.  Some of that anger will boil over here, unlike the milktoast other states.

I never thought I would see a Federal agency take over both the private and public debt markets, set interest rates abnormally low for economic and political reasons, and re-engineer the financial markets in one fell swoop.  I didn't even think it was possible.

The most damning circumstance of all is that America's popular political culture not only accepts authoritarian control without complaint, but invites it.  It will take several generations to overcome this happy slide into socialism, if it ever happens at all.

Tue, 12/24/2013 - 16:19 | 4273872 Peter Pan
Peter Pan's picture

A fiat system requires a central bank.

A gold and silver system is an international central bank without a chairman, offices and employees,

Tue, 12/24/2013 - 16:27 | 4273879 FreedomGuy
FreedomGuy's picture

How about a partially contratrian view for fun? For everyone who want to hang the Fed and perhaps a bunch of other government agencies, who is really at fault? It is a serious question. They were created by a government process through duly elected officials. They even did something back then no one bothers to do, now. They actually amended the Constitution! So archaic but perfectly proper. 

For all these years we have had our chance to observe, interpret and change it if we like...through our duly elected representatives. Those would be the representatives that average over 90% reelection rates. It does not change. It tends to grow, actually. Look at what the Fed does now versus the beginning.

I suggest it is our fault and the fact that over the last century we have outsourced our lives, especially economic lives to the government and it's agencies. If you believe in the goodness of government you should be happy and celebrate whatever successes you see. If, like me you clearly recognize that government is always out for itself, first and last then you say, "See, I told you so."

I personally would not hang anyone in the Fed or the government except by proving actual corruption. They are no more corrupt than the nitwits emptying the Social Security fund, making promises that promise to bankrupt Medicare and so on. We created the monsters. We keep feeding them. We watch them eat our lives and liberty and then we want to blame the monster for being what it is. In fact, we vote for MORE of it like ACA.

For the record, I am against central planners in all areas of life and I generally hate the people that institute and grow these things purposely. Then I despise those of you nitwits who keep voting for more of this crap. It would be okay except you force me to participate.

Wed, 12/25/2013 - 07:37 | 4274803 bozzy
bozzy's picture

The weaknesses in your argument are first that the "duly elected" bit has been steadily and increasingly bought, until, from an outside perspective, it appears to dance to whatever tune its sponsors demand. Then second is the reality that the supposed freedom of choice is and has been increasingly subject to the enormous influence of the propaganda machine.

Hence I say, if you want to stop those who profit from the system, fork and then dangle a few"pour encourager les autres". Go on, just try it. Harsh but effective.

Tue, 12/24/2013 - 16:39 | 4273895 Waterfallsparkles
Waterfallsparkles's picture

At this point they are just self serving.

Tue, 12/24/2013 - 16:47 | 4273907 Waterfallsparkles
Waterfallsparkles's picture

The Fed has brought in Socialism.  They control the Market and which way it goes, up or down,  they control interest rates.  They control the price of goods, like food and energy, although they do not count it toward inflation.  Their actions controls the price of food, gas and home heating oil.

I suppose the question is what do they not control. All of this by a carbal of non elected Bankers.

Tue, 12/24/2013 - 23:39 | 4274574 FreedomGuy
FreedomGuy's picture

they control the inputs to the economy like the interest rates but they cannot always control the consequences.

Wed, 12/25/2013 - 01:40 | 4274657 Clowns on Acid
Clowns on Acid's picture

Duh.... I gave you the Up arrow. Hehe...people don't know this ?

Tue, 12/24/2013 - 18:13 | 4273982 Radical Marijuana
Radical Marijuana's picture

As other comments have asked:

It proposes a trick question?

In the context of the perpetual propaganda war on this topic, as it appears in so many different articles on Zero Hedge, I repeat my kind of bla, bla, blah, below on this question:

Would "we" be better off if the international banksters had not succeeded in applying the methods of organized crime, such as bribery, intimidation, and assassination of those who could not be bribed or intimidated, in order to take over covert control of the American government, and then leverage that up through domination of the public school systems, and the mass media?

Golly Gee ...

What a trick question that obviously is!

The real question is what form of better organized crime is going to replace the Federal Reserve Board system, as currently integrated into the global banksters' systems ???

The supreme paradox continues to be that the most important thing that human beings do is operate their death controls upon themselves. They have developed to do that through the maximum possible deceits, which then enabled the financial system to be built upon the maximum possible frauds. The Federal Reserve Board is the primary Central Bank, integrated into the global systems of Central Banks, which are the triumph of the best organized gangs of criminals consolidating their control over a globalized civilization.

So far, so good ... However, the deeper problems are CHRONIC POLITICAL PROBLEMS, which always continue, as long as any human beings survive. The deeper issue is NOT whether "we" would be better off without the currently best organized gang of criminals being able to dominate the currently established systems of human ecology and political economy. The deeper question is whether or not "we" might be able to go through sufficient paradigm shifts to radically change the way that is being done, by being more consistent with the application of more radical truths to these kinds of problems, after we do a better historical analysis to understand them.

There are more and more people who are understanding enough of history to understand the international bankers are the biggest gangsters.  The real history is clear that those banksters made and maintained the currently established systems to become fundamentally fraudulent financial accounting systems, which benefited them fantastically, while their systems were screwing everyone else.

However, I continue to find almost nobody who goes on to be proposing any resolutions to those problems which remain consistent with that historical analysis: government is organized crime, controlled by the best organized gang of criminals, because money is measurement backed by murder.

Our problems have become trillions of times more difficult than ever before in human history, because the real death controls are, and always will be, the central controls of everything else. The better the death controls are done, the better that civilization could become, and vice versa ... The PROBLEM is that our current civilization has apparently dead ended itself into its sealed box of the triumphs of deceits and frauds controlling what that civilization does, to such an degree that it can not breakthrough to more radical truths about itself, in order to make a greater use of information, with higher consciousness, about how it operates those death controls, that back up the debt controls.

The Federal Reserve Board is the leading national Central Bank, integrated into the global systems, which were achieved by operating according the principles and methods of organized crime, to make and maintain the systems of government that we have at the present time. Those are attempting to consolidate global control, BUT, based on even bigger lies, backed by even more violence ... which process is becoming increasingly problematic!

The deeper issues are the grand paradox that civilization should develop better death control systems, BUT, the ones that have become the most successful are those which operate through the maximum possible deceits, while their controlled opposition has agreed to spout the same sorts of impossible bullshit social stories, that no such controls should exist at all, which helps the professional liars and immaculate hypocrites get away with their deliberate ignorance towards the real social and environmental facts regarding what they are actually doing.

The most important thing civilizations must do are operate their systems of death controls, upon which everything else that they could do ultimately depends. Any system of creative alternatives would have to have an alternative system of death controls, as the keystone to any possible integrated arch of alternatives, assembled into some system. Those death controls would have to be the lynch pin to hold the whole process together, because the death controls are necessarily the central core of all of the other controls.

However, at the present time we are trapped in the paradoxes that the established systems operate through the maximum possible deceits and frauds about themselves. Therefore, of course, everything that the Federal Reserve Board says, and everything it actually ends up doing, are quite diametrically opposite. However, the CHRONIC POLITICAL PROBLEMS continue to exist, and demand some perpetual efforts at resolving them ...

Since society has evolved, while the Federal Reserve Board existed, to become a globalized electronic fiat fraud, backed up with atomic bombs, the real problems that exist now can never be resolved by any nostalgic nonsense about going backwards in time to find the solutions. Rather, the real ride into the future is going to be watching the globalized banksters attempting to consolidate their control, through more legalized lies, backed by legalized violence, certainly spin out of control, due to the impossibility of that violence ever making those lies become true. Therefore, the foreseeable future looks like some series of psychotic breakdowns, and social storms, caused by the paradox of final failure from too much success at controlling society through frauds.

But nevertheless, the real problems will continue to be whether or not civilization could survive to evolve better death control systems. The Federal Reserve Board is the historical product of the fact that money is measurement backed by murder, which enabled the maximum frauds, to be backed by the maximum deceits. The deeper issue is whether or not the human species can survive through the transformations driven by the scientific enterprise, by applying enough of that to understand itself ???

"We" would be better off if "we" developed a better system of death controls, to back up a better system of debt controls. The current system built by the banksters is dead ending itself. The success of the debt slavery systems, operated through organizations like the Federal Reserve Board, have driven their own numbers to become debt insanities. Those social insanities are threatening to breakdown into causing death insanities ... (Probably a lot of that can not be prevented now ...)

But nevertheless, "we" could at least theoretically understand the real situation to come up with more realistic solutions, which must be based on going through a series of profound paradigm shifts, in the form of intellectual scientific revolutions, because there is no way to put electronics and atomic power back in the bottle. Those genies are out and about now, and threaten to destroy us, because they are trillions of times more capable and powerful, but are being employed to astronomically advance the established social pyramid systems, which are based on the dominant minority using lies and violence to control the vast majority, by keeping them ignorant and afraid. That social pyramid system should be more consciously seen to actually be in shape of a toroidal vortex, since that is what it actually is. Similarly, there is a general need to retool the fascist plutocracy systems, so that they become more self-aware about their own true nature.

While it is way too euphemistic to call human evolution a "learning experience," nevertheless, it still is. Human evolutionary ecology, and its embedded political economy, has developed as energy systems, whereby its real controls were operated through the maximum possible deceits and frauds, with the Federal Reserve Board, within the whole Central Bank system, exemplifying that process. Therefore, it appears practically impossible to have any saner public debates about those institutions.

The answer to the question posed by this article above is OBVIOUSLY YES! However, that answer has no good content unless it addresses the possible ways that "our" money system could become better ways to engage in measurements, which were better backed up by murders. The REAL ANSWER is that the only thing that could replace the Federal Reserve Board, and the banksters' global systems generally, is better organized crime, because government is necessarily a form of organized crime, operated by the best organized gang of criminals.

The problem is that those realities have been magnified many orders of magnitude by advances through paradigm shifts in basic sciences, such as physics and biology, but nothing like that has been achieved in the realm of politics, due to the deeper paradoxes that political realities were based on death controls that operated through the maximum possible deceits, in order to be successful, which then enabled the maximum possible financial frauds to be the successfully operated symbolic systems built on top of that foundation.

Therefore, the Federal Reserve Board is now integrated into a global system of electronic frauds, backed by the force of atomic bombs. Obviously "we" should replace that system with better ones. However, we need much more profound design science in order to PERHAPS survive through the development of better systems. The grand paradox is that the control of civilization continued to be based on death controls, backing up debt controls, and that must continue, in one way or another, as long as civilization survives, but those systems now operate through being able to deny the facts about themselves, and to continue to get away with successfully lying about what they are doing ... while the contradictions thereby generated keep on getting manifestly BIGGER!

In that context, there is no doubt that "the Fed’s modus operandi has been to trick capitalists into doing things that are not aligned with economic reality." However, it is vital to appreciate the degree to which that so-called "economic reality" was itself merely more organized lies, operating organized robberies, because it must necessarily have been!  In order for human civilization to continue to survive understanding other energy systems better, then it must understand itself as an energy system better. However, doing that MUST regard the death controls as central to everything else, and therefore, MUST operate better death controls, to back up any better debt controls.

The Federal Reserve Board IS the triumph of organized crime, controlling governments, which were themselves the historical products of organized crimes becoming triumphant in the past. There is no other realistic way to "end the Fed" than to go through sufficient paradigm shits in politics to make it possible to operate better organized crimes. To work, that has to be perceived inside the context of perceiving human civilizations as energy systems, which therefore enables those systems to be reconciled with sciences such as physics and biology. Right now, the social pyramid systems depend too much upon being able to operate through deliberate ignorance with respect to themselves. Therefore, they threaten to destroy themselves, due to their own runaway psychotic madness.

There is no way that a civilization that develops capacities and powers, like electronics and atomic energy, could survive operating itself in ways which enable itself to continue having extreme deliberate ignorance towards how it operates as an energy system. The Federal Reserve Board is the main institution while illustrates that problem. Replacing it with better institutions should be done. However, at the present time there is way, way, way too little general awareness, and even less agreement than that minimal amount of understanding, of what it would mean for money being measurement backed by murder to move beyond the Neolithic style of civilization, to survive as some Translithic style of civilization.

At the present time, legalized lies, backed by legalized violence, are being amplified to astronomically increased sizes, without that being understood by almost anyone, and without almost anyone even wanting to understand that! Meanwhile, the combined money/murder systems have already become globalized electronic frauds, backed by atomic bombs, while those systems are still based on lying about themselves, and having most people still believe in those lies. There is no way for human civilization to develop better debt control systems, (i.e., replace the Federal Reserve Board system with another better system), unless there are better death control systems to back that up.

Tue, 12/24/2013 - 18:55 | 4274188 Future Jim
Future Jim's picture

I think most people can get the idea that money is just another product, but they just haven't ever heard this idea before.

Money is a Product

If you’re like 95% of Americans, you’ve NEVER thought of money as a just another product – like iPhones or insurance policies, but how is money NOT a product? What if any of us could invent a useful money and sell it to whoever wanted to use it? What if our money were better than others?

We use money because it is way more efficient than directly trading the product of our labor for the product of other people’s labor. For a money to be useful, it must therefore be portable, divisible, stable, and very difficult to counterfeit, which are among the most critical factors that contribute to the only necessary factor: A useful money must be widely accepted as payment.

Suppose several companies produced their own brand of money, and you could ask for payment, and store your savings, in the brand of your choosing. Which monetary product would you prefer to use? Would you choose a brand of money whose producer would buy their money back from you at any time? For example, suppose you could be confident the the producer would give you one ounce of gold for their $100 bill. – OR – Would you ask for payment, and store your savings, in the brand whose producer would only give you their own pieces of paper in exchange for their $100 bill?

In the past, one could have argued that there would be more delay and more cost to convert back and forth between a larger number of currencies, but given today’s technology, such conversions would be instantaneous and free.

Since 1914, the Federal Reserve produces all of our money in America. How do you think they are doing? How is it possible that a Hershey bar cost 3 cents in 1918, and 85 cents now?

We are being taxed (robbed) indirectly through inflation because the government, the states, the cities, the corporations, and the people, all borrow money that doesn’t exist. Over 90% of the money borrowed was created out of thin air so that it could be given to the borrower; whereas, automobiles and college degrees are not created out of thin air. Therefore, more dollars can be offered to buy the same car or medical procedure. Therefore, each car costs more. Therefore, each dollar is worth less.

Theft through inflation is even worse than it seems because – for a given currency – prices should naturally go down for all products, and although the prices for most products will not go down as fast as they do for computers, prices for all products should go down for the same reason – efficiency and innovation. For example, if dollars were not created out of thin air, then as quantities, efficiency, and innovation increased, we would get more and better cars for the same amount of labor. Given more and better cars and the same total number of dollars in existence means that each car would cost fewer dollars, which means that each dollar would be worth more. So how is it that each dollar is worth less and less?

We are being robbed through inflation, but who gets to keep the difference? If we are free, then why aren’t we all allowed to create a money to compete with the Federal Reserve? Why doesn’t any journalist, politician, or economist on TV dare to ask these questions?

The reality is that we are not free.

To understand that “Money is a Product” is a necessary epiphany to understand the world we live in, and more importantly, how to progress beyond it. Ironically, it is self-proclaimed Progressives who are the most resistant to the reality of money, and who are thus holding us back. Therefore, you will never learn the reality of money from the mainstream media or from government schools.

Thanks to the Internet and the Crash of 2008, people are beginning to wake up to reality.

The Promise of Reality is Freedom.

Tue, 12/24/2013 - 22:27 | 4274488 Radical Marijuana
Radical Marijuana's picture

You are right, Future Jim, that "money is a product." Obviously money is made by human beings. I think you also point out the deeper problem with our current money system, which is that, between taxation and legal tender laws, our public money supply is a product which enjoys an almost total monopoly to be produced by private banks.

My definition that money is measurement backed by murder agrees with that definition that money is a product. I just analyze the production of money into its two most important parts. Namely, the part where one symbolically measures something in terms of that money, and the part where the meaning of that measurement is enforced.

In the case of the current American public money supply, Federal Reserve Notes are private bank frauds, forced by the government to be treated by everyone as legal tender, particularly by the fact that the people are forced to pay taxes using that form of money. It was not a coincidence that the Income Tax and the Federal Reserve Board both came into existence in 1913. They actually work together to make the money created out of nothing, as debts, by private banks, be backed up with the force of the Federal government.

In effect, the global systems of integrated Central Banks are the triumphs of the international banksters taking control over almost all the governments in the whole world, so that they would all force their people to accept their debt slavery, within the established systems where the banksters enjoy an almost total monopoly to make the public money supply, as a kind of legalized counterfeiting, which continues to be a crime for anyone else to do, which crimes are punished by the governments.

Central banks are primarily about their power to dominate governments so that the private banks enjoy a monopoly to produce the public money supply that everyone else must use, while any other kind of possible competing money is disadvantaged in every way under that relative monopoly of the private banks to have their frauds backed up by the force of governments!

Central Banks are the Fraud Kings, supervised by the King of Kings of Fraud, the Bank of International Settlements. They are all based on the prolonged history of applying the methods of organized crime to systematically take control over the sovereign powers of governments, in order to force everyone else to accept the banksters' triumphant frauds, and therefore, for everyone to adapt to living their lives within those established systems of debt slavery.

The deeper problems are NOW that the success of that runaway system of debt slavery, due to the privatized, monopolization of the power to make money out of nothing, as debts, has driven the debt slavery numbers towards debt insanities, while simultaneously that fraudulent, privatized, production of monopolized money, has driven runaway social polarization, as well as paid to strip-mine the planet, while destroying the natural world, since making money out of nothing has no relationship to the laws of nature, except inasmuch as lies can be backed up with violence, in order that those lies can become socially dominant, and thus control what civilization does.

Wed, 12/25/2013 - 10:57 | 4274961 tradewithdave
tradewithdave's picture

First the tally stick, then double entry accrual accounting, now Ricardian triple entry accounting with means testing capability to empower the death panel. Okay, fixed it.

Tue, 12/24/2013 - 18:03 | 4274070 lex parsimoniae
lex parsimoniae's picture

"Wouldn’t we be better off without a central bank?"

ok, I'll, play!!

is a frog's butt watertight?

does a bear shit in the woods?

does the Pope wear a beanie?

Tue, 12/24/2013 - 19:45 | 4274271 Clycntct
Clycntct's picture

Now your talking,not like the above poster who after reading I thought what was I smoking.

Tue, 12/24/2013 - 18:17 | 4274105 Loophole
Loophole's picture

It's not that the Fed "doesn't work" or has implemented "policies that have failed."

Anyone with half a brain HAS to know that printing money is just another way of stealing and that all the elaborate theories, etc. will accomplish nothing but economic destruction.

There is only one thing the govt can do with the economy that will allow prosperity: Get the hell out of it.

Tue, 12/24/2013 - 20:24 | 4274333 Reaper
Reaper's picture

We need the Fed and our government to think and plan for us. The system identifies and selects the most brilliant central planners and bankers. Be thankful to your central planners and bankers. What they do is beyond your simplistic understanding. They love you.

Wed, 12/25/2013 - 02:38 | 4274692 MTAR
MTAR's picture

Keep it simple: End the Fed!!

Wed, 12/25/2013 - 03:09 | 4274713 vanityvanity
vanityvanity's picture

LEGAL PLUNDER - Bastiat's The Law.

The Fed obtained a monetary monopoly in 1913. It's job was to manage a commodity-backed currency. That currency eventually transformed into pure fiat. Had they properly expanded the money commensurate with the growing economy, the fiat currency would have been as sound as gold. But just like any other monopoly under  government control, the corruption set in like a cancer.

Is anyone surprised by these pigs gorging at the trough? 

There should be no federal income tax and no monopolistic central bank. Absent these two abominations all our monetary and  governmental nightmares vanish. No more rampant inflation, no more pointless wars. The system would self-regulate as God intended : )

Wed, 12/25/2013 - 07:40 | 4274807 bozzy
bozzy's picture

Unfortunately for the rest of us, the ultimate price for American involvement in WW2 was the petrodollar. Now the Fed controls the west, and many other fiat based money systems.

Wed, 12/25/2013 - 10:46 | 4274956 tradewithdave
tradewithdave's picture

Sure, now that they got your $4 trillion, "pull it!"... that way there's no evidence.

It's a wonderful lie - video

Wed, 12/25/2013 - 10:52 | 4274960 Disenchanted
Disenchanted's picture

re: "standard historical narrative"

It's all bullshit...

Wed, 12/25/2013 - 12:23 | 4275079 withglee
withglee's picture

The question should be broader: "Do we need banks?"

Money is an efficiency for traders. It stands for "a promise to complete a trade". Capitalism demands that such promises be backed by capitalists. Banks were formed to "hold" the backing. They then stretched that function through fractional reserves to leverage this backing. Taken to the limit (i.e. 0% reserves), there is no backing whatever and thus no capitalism. Right now backing seems to oscillate between 10% and 20% and is one of the knobs TPTB twist (another being interest rates) to manipulate (ummm regulate) the system.

Proper management of any Medium of Exchange (MOE) means the following:

  • freely back all trading promises (certify them by issuing money).
  • extinguish the money on delivery
  • Measure DEFAULTS.
  • Collect INTEREST equal to DEFAULTs.

The relation is: INFLATION = DEFAULT - INTEREST. And through proper management, INFLATION is necessarily zero at all times everywhere.

Since the amount of INTEREST collections cannot be assessed until DEFAULTs are known (i.e. after the fact), it becomes an actuarial problem to charge INTEREST before the fact and then to adjust after the fact. It is no different than insurance where the risk is estimated before the fact; premiums are charged; claims are experienced; and premiums re-adjusted so on average the premiums equal claims.

Insurance companies (in a highly competitive environment) make their money through investment income, not through charging premiums exceeding claims.

Just as we can have multiple privately managed insurance companies, we can have multiple privately managed MOE's. However, since the money is universally transacted, it needs to have a universal form. We sort of have this in credit cards.

What we don't have is proper management of "any" MOE, and we never have had proper MOE management historically.

It would be neat to find a cryptographic method of imposing and guaranteeing this proper MOE management without the obvious deflationary flaws that BitCoin exhibits (i.e. supply is guaranteed to always be less than demand by the algorithm).

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