Friday, March 13, 2009

The Gig Is Up

Populist lawyer, Gary Fielder, presents “The Gig Is Up: Money, the Federal Reserve and You." Live from Wolfe Hall at The University of Colorado School of Law, on December 4, 2008, Mr. Fielder, a criminal and constitutional lawyer from Denver, Colorado, presents a power point and video presentation on the creation of money with an historical analysis of our current banking system. With quotes from Ben Franklin, Thomas Jefferson, Abe Lincoln, Ron Paul, Dennis Kucinich and many others, Fielder makes his case to abolish the Federal Reserve and return to a sound and honest money system. Fractional Reserve Banking. Currency. Amero. World Government. International Banking. Produced by Jack Creamer, Side 3 Studios, Denver, Colorado. Video edits by Jonathan Ellinoff. Technical Assistant, Rye Miller. This video is for educational purposes only. Admission was not charged, nor will any effort be made to profit from its production or sale. The DVD is free.


BLBeamer said...

I thought it was "jig"????

One Salient Oversight said...

I have no problem with the Fed being investigated, but fractional reserve banking has been part of the financial system for centuries. Without the ability of banks to create money by investing in profitable enterprises, capitalism would pretty much collapse.

Of course I'm not as "capitalist" as some, but even for Socialists it remains an important factor in a national economy (unless you're communist, of course).

In short, without fractional banking you would have no market.

BLBeamer said...

We had fractional reserve banking even in the days of the gold standard. All banks lent out more money then they had backed in gold bullion. In those days, bank runs "killed" the bank and its investors. The biggest difference today is the level of reserves is largely determined by the Fed, rather than the judgment of the bank directors as it was in the pre-Fed era. That is one of the primary tools of money creation and is at the root of both the Great Depression and our current situation.

Banks who had the highest reserves, fared the best when the economy soured but they made lower profits when times were booming. It's called "leverage". Many, many banks failed because they lent out more money than they could repay when depositors started asking for their gold or deposits back.

It's not a recent phenomena.

But, who's going to investigate the Fed? Congress? It is their responsibility, but collectively they aren't capable of conducting a fair investigation of anything based on facts and merits. Our political class is sick, sick, sick.

Coffee Bean said...

BLBeamer... LOL! I think Gig or Jig is used in this context.

Money is a very difficult subject, to me anyway. I haven't shown this to my husband yet... when we discussed this issue back this summer (I was asking him about Ron Paul) he said that going back to a gold standard would restrict the money supply too much. It'll be interesting to see what he has to say after he looks at it.

One Salient Oversight said...

The thing about gold is that as soon as you back your currency with it, then the world's gold miners become de facto central banks.

Gold, like anything produced, is subject to the forces of supply and demand. If gold goes up and down in price, so will currency.

Price stability is absolutely essential. Currency is a way of measuring the value of goods and services, and if the value of currency is eroded (or even increased) then it distorts how marketplaces act.

Money doesn't need to be backed by anything of value because money itself is intrinsically valuable - it is the only thing that can be used simultaneously to determine the value of goods and services while also functioning as a means to exchange those goods and services.

Because of fractional banking, central banks have the theoretical ability to increase the money supply to infinity... or to completely remove every cent from the economy.

Central Banks must therefore use their powers to ensure price stability - neither inflation nor deflation.

Once price stability goes, and the economy enters an inflationary or deflationary spiral, the economy gets badly wrecked.

BLBeamer said...

I think purchasing power is much more important than price stability. Miners becoming de facto bankers is not a viable concern, I believe, given the difficulties of mining and gold's scarcity. That, plus the recognition that only gold that is mined and then sold has any value to miners.

I am aware of only one time in history when gold was injected into an economy at such a high rate that it caused inflation: imperial Spain in the days of the conquistadors at one time received so much gold from the New World that it caused inflation.

That is unlikely to happen again.