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California’s Empty Wallet: Turning Crisis into Opportunity
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California State Controller John Chiang has warned that without a balanced budget in place by July 1, he will begin using IOUs to pay most of the state’s bills. On June 25, California Governor Arnold Schwarzenegger rejected a plan that would save the state $3 billion by cutting school spending, saying he would rather see the state issue IOUs than delay the funding problem with a piecemeal approach. The state’s total budget deficit is $24.3 billion.
Meanwhile, other funding doors are slamming closed. The Obama administration has said it will not use federal stimulus money to prop up California; and Fitch Ratings, a bond rating agency, announced that it was downgrading the credit rating of the state, which already has the lowest in the nation. Once downgraded, California’s rating is likely to fall below the minimum level legally required for most money market funds, forcing the funds to sell their California bonds. The result could be a cost of millions of additional dollars in higher interest rates for the state.
What to do? Perhaps California could take a lesson from the island state of Guernsey, located in the English Channel off the French Coast, which faced similar funding problems in the 19th century. Toby Birch, an asset manager who hails from there, tells the story in Gold News:
“As weary troops returned from a protracted foreign war [the Napoleonic Wars ending in 1815], they encountered a land racked with debt, high prices and a crumbling infrastructure, whose flood defenses were about to be overwhelmed . . . . While 1815 brought an end to the conflict on the battlefront, . . . severe austerity ensued on the home front. The application of the Gold Standard meant that loans issued over many years were then recalled to balance the ratio of money to precious metals. This led to economic gridlock as labor and materials were abundant, but much-needed projects could not be funded for want of cash.
“This led to a period of so-called ‘poverty amongst plenty’. . . . The situation seemed insoluble; existing borrowing costs were consuming 80% of the island’s revenues. What was already an unsustainable debt burden would need to be doubled to fund the two most essential infrastructure projects. This was when a committee of States members was formed . . . . The committee realized that if the Guernsey States issued their own notes to fund the project, rather than borrowing from an English bank, there would be no interest to pay. This would lead to substantial savings. Because as anyone with a mortgage should understand, the debtor ends up paying at least double the amount borrowed over the long-term.”
To prevent an unwanted inflation of the money supply, the Guernsey States issued the notes with a date due, and on that date the bearer was paid in gold. The money came from rents on the finished infrastructure, supplemented with a tax on liquor. Birch goes on:
“The end result of the Guernsey Experiment was spectacular – new roads, sea defenses and public buildings were established, fostering widespread trade and prosperity. Full employment was achieved, no deficits resulted and prices were stable, all without a penny paid in interest. What started as a trial led to a string of construction projects, which still stand and function to this day. Money was used in its purest form: as a convenient mechanism for oiling the wheels of commerce and development.”
Like Guernsey, California is facing “poverty amidst plenty.” The state has the eighth largest economy in the world, larger than Russia’s, Brazil’s, Canada’s and India’s. It has the resources, labor, and technical expertise to make just about anything its citizens put their minds to. The only thing lacking is the money to do it. But money is merely a medium of exchange, a means of getting suppliers, laborers and customers together so that they can produce and exchange products.
- A d v e r t i s e m e n t
As has been explained elsewhere, today money is simply credit. All of our money except coins is created by banks when they make loans. The current crisis stems from a credit freeze that began on Wall Street in the fall of 2007, when banks were required to revalue their assets due to a change in accounting rules, from “mark to fantasy” to “mark to market.” Banks that were previously considered in good shape, with plenty of capital for making loans, suddenly came up short. Lending fell off, and so did the available money supply.
Just understanding the problem is enough to see the solution. If a private bank can create credit on its books, so can the mighty state of California. It merely needs to form its own bank. Under the “fractional reserve” lending system, banks are allowed to extend credit – or create money as loans – in a sum equal to many times their deposit base. Congressman Jerry Voorhis, writing in 1973, explained it like this:
“[F]or every $1 or $1.50 which people – or the government – deposit in a bank, the banking system can create out of thin air and by the stroke of a pen some $10 of checkbook money or demand deposits. It can lend all that $10 into circulation at interest just so long as it has the $1 or a little more in reserve to back it up.”
The 10 percent reserve requirement is now largely obsolete, in part because banks have figured out how to get around it. What chiefly limits bank lending today is the 8 percent capital requirement imposed by the Bank for International Settlements, the head of the private global central banking system in Basel, Switzerland. With an 8 percent capital requirement, a state with its own bank could fan its revenues into 12.5 times their face value in loans (100 ÷ 8 = 12.5). And since the state would actually own the bank, it would not have to worry about shareholders or profits. It could lend to creditworthy borrowers at very low interest, perhaps limited only to a service charge covering its costs; and on loans the bank made to the state, the state would ultimately get the interest, making the loans essentially interest-free.
Precedent for this approach is to be found in North Dakota, one of only three states currently able to meet its budget. North Dakota is not only solvent but now boasts the largest surplus it has ever had. The Bank of North Dakota, the only state-owned bank in the nation, was established by the legislature in 1919 to free farmers and small businessmen from the clutches of out-of-state bankers and railroad men. By law, the state must deposit all its funds in the bank, and the state guarantees its deposits. The bank’s surplus profits are returned to the state’s coffers. The bank operates as a bankers’ bank, partnering with private banks to loan money to farmers, real estate developers, schools and small businesses. It makes 1% loans to startup farms, has a thriving student loan business, and purchases municipal bonds from public institutions.
Looking at California’s budget figures, projected state revenues for 2009 are $128 billion. At a reserve requirement of 10%, if California deposited all $128 billion in its own state-owned bank, it could issue $1.28 trillion in loans, far more than it would need to cover its $23 billion budget shortfall. To lend itself the money to cover the shortfall, it would need only $2.3 billion in
deposits and about $2 billion in capital (assuming an 8% capital requirement). What Sheldon Emry wrote of nations is equally true of states:
“It is as ridiculous for a nation to say to its citizens, ‘You must consume less because we are short of money,’ as it would be for an airline to say, ‘Our planes are flying, but we cannot take you because we are short of tickets.’”
As a card-carrying member of the banking elite, California could create all the credit it needs to fund its operations, with money to spare.
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June 30th, 2009 at 4:19 pm
first?
CA PEOPLES BANK Reply:
June 30th, 2009 at 5:50 pm
CA PEOPLES BANK, GREAT IDEA, TOO BAD ARNOLD IS A NUMB NUTS, WHO DOES NOT GIVE A RATS ASS, SINCE HE IS IN OFFICE FOR SHOW SINCE HE IS TOO LAME FOR HOLLYWOOD
R E S I S T , C O M Reply:
June 30th, 2009 at 7:13 pm
Billy Ruben Reply:
July 1st, 2009 at 10:48 am
Did you mean “racist.com”?
Go away.
Then ask Him for forgiveness.
I Reply:
July 1st, 2009 at 1:47 pm
EXPOSED for what RESIST is!!!
Right on Billy.
RESIST*COM Reply:
July 1st, 2009 at 7:27 pm
We were never hiding it!
We are WHITE RACISTS
RESIST*COM Reply:
July 1st, 2009 at 7:26 pm
We were never hiding it.
We are WHITE RACISTS
Glenn Beck's Banker Reply:
July 2nd, 2009 at 1:15 am
Hey, arnies got the seal of california right in front of his nazi deathhead beltbuckle in this picture. He is the best ain’t he.
EnglishPatriot Reply:
July 1st, 2009 at 5:55 am
I’ve been to Jersey and Guernsey. They’re beautiful little islands. I wish I could migrate there from here (England).
geoff Reply:
July 1st, 2009 at 10:24 am
second
paul Reply:
July 1st, 2009 at 3:04 pm
The whole state bank thing sounds like a great idea and possibly an end run around the corporate thieving banks. Why wouldn’t every state have it’s own bank? The idea seems simple enough to grasp and easy enough to implement, so why does this not happen? If every state started their own bank we could get out of the credit crunch we’re in and we could start funding EVERYTHING at a better rate. Sounds like a no-brainer.
reconmarine Reply:
July 1st, 2009 at 5:01 pm
This article is against the FED/Rothschild Banking Group. We own(NWO) you.
June 30th, 2009 at 4:29 pm
No I am the first arab-american president of the usa born in africa
R E S I S T , C O M Reply:
June 30th, 2009 at 7:16 pm
Oh well, every politician before Obama were anti-White too, and jews(still there).
I Reply:
July 1st, 2009 at 1:50 pm
Resist is just a spewer of racist hate,
nothing more.
CA PEOPLES BANK Reply:
June 30th, 2009 at 8:14 pm
NO WRONG BANKERS, I AM 50 % WHITE, 44% ARAB, 6% AFRO PRES…
fed up Reply:
July 1st, 2009 at 10:06 am
YES IT’S A BIG JOKE THERE LAUGHINGTHERE ASSES OFF!! A MUSLIM ,BORN IN KENA ,MAN I BET THERE SAYING WHAT A BUNCH OF DUMB ASSES WE ARE !!!!! NOT TO MENTION THE BIGEST FUCKING LIAR SINCE SATAN HIMSELF
June 30th, 2009 at 4:40 pm
you SHUT UP scum. Lick those boots and do as your told u slave. take those mercury and cancer virus injections like the rest of the sheep!!
FreedomLover Reply:
June 30th, 2009 at 5:08 pm
I’ve never been good with economics, and I’m sure I’ll get bashed for this. BUT
What if… every single debt of every country, corporation and individual was completely forgiven – wiped out? Let everyone start over with a clean slate, earn their own money and pay cash for their own life’s needs?
It just seems like an impossible task to fix this any other way.
arwijn Reply:
June 30th, 2009 at 5:50 pm
It’s okay. Ofcourse it would work! The problem is that the states don’t own the money! THey lend it from private banks, and they don’t want to scratch away the loans, hell, they’dd prefer to screw the people over and take all their assets!
So what the government does instead is give them cash to pay of the debts… which they lend from the bank (national debt to a private bank).
But instead of using the money to pay of the debt, the banks use it to pay their executives!
DOUBLE SCREWED!
The only way to stop the madness and bankster’s rape fest is to abolish the federal reserve and put in a gold standard!
sovereign Reply:
June 30th, 2009 at 6:49 pm
This might help you a-little Freedom Lover, there is such a design of economics that was greatly looked forward to-that is stated in the book of Leviticus all of which probably started losing it’s obedience 70-100 a.d. It was called Jubilee during this time all debts were forgiven, slave owners gave up there slave (employee), land debts were returned to their original owners etc. and so-on and this took place every 50 yrs, so in a sence everybody got to start a- new / clean slate, because that is the way Yaweh willed it to be. So ask yourself, in this countries day and age how many industrial captains are obedient to the Almighty Creator or acknowledge Him?
FreedomLover Reply:
June 30th, 2009 at 7:19 pm
What few do acknowledge Him are definitely a minority. But look below – that’s where I got my “debt forgiveness” idea. LOL
We really don’t have people who are willing to forgive, there is too much greed.
FreedomLover Reply:
June 30th, 2009 at 5:09 pm
The Israelites had a command to do this every 50 years. It was called “the jubilee”. All slaves were freed, all land reverted to the rightful owner. Hey, if it was good enough for them……
dan Reply:
June 30th, 2009 at 6:46 pm
Unfortunately there is no evidence that they ever kept it.
Patriot Expat Reply:
July 1st, 2009 at 12:03 am
every forty-nine years, actually.
Makes sense... Reply:
July 8th, 2009 at 1:49 pm
49 being a multiple of 7…
CA PEOPLES BANK Reply:
June 30th, 2009 at 8:20 pm
OOHHH SAAYY CAANN UUU SEEE…. LAND OF THE SLAVES, AND HOME TOOO THEEE BANKERS…
June 30th, 2009 at 5:06 pm
I notice many people claim Obama is Arab and see it as negative. Might I remind the so-called NWO fighters: your race and country conquered the world and brought the rest of its people this NWO. The founding fathers were free masons and you killed all the natives for your country of freedom. So look at the beam in your eye before you look at the splinter in someone elses. Arabs never did anything to you. By the way, I hope you are trying to learn Spanish.
brad Reply:
June 30th, 2009 at 9:13 pm
They bealive that all arabs are Terrorists which they are not. They hate America for killing millions of thier family and trying to take over the world. The same EXACT thing why we hate america for. If you seen Osama videos he explains that america is a facist government and all the stuff that Alex jones says. They are using osama to make us look like Terrorists or who ever goes agaisnt the Facist government. So what Osama says about america Is true.
jim Reply:
July 1st, 2009 at 1:33 am
brad i too think like you…. I do not think that all ababs are terrorists, but I do think that (allmost) all terrorist are arabs.
and why did you capitalized terrorists ?
I Reply:
July 1st, 2009 at 1:59 pm
All hale the Arabian king terrorist G Dubya Bush and Duke Cheney!
jim Reply:
July 2nd, 2009 at 12:12 pm
I agree with that also…..
I Reply:
July 1st, 2009 at 2:02 pm
Racist retards like RESIST, don’t get that.
I Reply:
July 1st, 2009 at 2:01 pm
Racist idiots like RESIST don’t get that.
June 30th, 2009 at 5:07 pm
Obama after paryting http://img40.imageshack.us/img40/2301/40426358.jpg Remember, the government is your friend (sarcasm).
June 30th, 2009 at 5:22 pm
I know Ellen Brown, and her idea of a California State Bank makes perfect sense. California has the eight largest economy in the World…if it gets its own State Bank, this could be the first shot in the battle to morph/change the Fed…..let’s support this.
June 30th, 2009 at 5:25 pm
I was being sarcastic as well. People we need to save this country.
June 30th, 2009 at 5:37 pm
Floks, c’mon. We’re talking about California here people… There’s no way in hell they’ll do that (create a bank of CA like the article suggests) because to do so would make way too much sense. Can’t do that now can they?
sovereign Reply:
June 30th, 2009 at 7:30 pm
if they withdraw from the union and declare themselves a ’sovereign’ nation then they have the right to print and bank their own money, check out Lakota Oyate these Sioux peoples have declared themselves sovereign-gave back their s.s. #, and the treaty signed ca. 1870, along with birth certificates. They now have their own property, silver/gold, coin it AND bank it- internationally. Sounds like a familiar country that used to exist…but for the life of me I can’t remember the name of it.
BobLeeSwagger Reply:
July 1st, 2009 at 2:37 pm
I don’t know what has crawled up the moderator’s ass, but you need to stop deleting comments that make sense and start deleting the bullshit instead. There, now that I’ve gotten that off my chest- Im with you sovereign, I wish my location would leave the union as well and formulate our own bank and finance system, God only knows we have enough gold and silver to float our own economy. Blue ticket all the Seattle and CA liberals and get them out of here and we might just be able to build up our infratructure and get some real industry goin up here in the last frontier. Unfortunately thats as likely to happen as CA setting up a viable solution to ANY problem no less this one. We, like most other places have been infested with either a bunch of jingoistic, slobbering, “right-wing” idiots, or a bunch of left wing tree huggin’, gaia worshipping, throwback retards from the left coast and the end result is we have had our collective spine decalcified, and our nuts shrivelled off. On that note- since this place can’t see the forrest for the trees enough to change, is there any room for a washitchu there amoungst the Lakota natives?
June 30th, 2009 at 6:04 pm
i cant believe alex jones had mtv idiots on his show mtv is the biggest brain washing channel on the planet jones im starting to wonder about you
brad Reply:
June 30th, 2009 at 9:15 pm
Its the programmers that brain wash not the actors. They actors are only doing the JOB for them and getting paid for it.
Caitlyn Reply:
July 1st, 2009 at 10:21 am
The actors sounded like they did not have brains to wash. I approve of Alex trying to awaken more people among the PopTart culture, but really, these two were from Planet PopTARD!
June 30th, 2009 at 7:08 pm
This would be the sensible thing to do for the people of California…like other Americans, these dumb animals subscribe to the Demo-publican duopoly which is bought and paid for by the banks.
“You can’t fix stupid.”
June 30th, 2009 at 7:21 pm
Hey Arnie, how about a “smaller” government?
June 30th, 2009 at 7:21 pm
I live in California and I know that the more reasonable the idea the less likely anybody would take it seriously. Arlold is bad enough, with the possibility of Gavin Newsom (Mayor of San Francisco) replacing him means all reasonable people will leave the state. Like the Grapes of Wrath in reverse.
June 30th, 2009 at 7:21 pm
Hey Shwartzenegger!! Viva La Raza!!! Cali is Mexifornia now. Your tax base is watching you from their rear view mirrors. No normal white person would want live in cali now unless you are a gazillionaire. Too many leaches just killed the host. What you need to do is give IOU’s to all of the illegals. That’s who’s breakin yer balls man.
Got any spare change??
June 30th, 2009 at 8:53 pm
Karma’s a bitch Ahnold….What did he so famously say in Terminator?…Oh yeah, “Fuck You Asshole!”Go choke on your I.O.U.’s…Nazi.
June 30th, 2009 at 9:54 pm
Schwarzenegger talked about opening up the books when he came in as governor but it sure wasn’t the Comprehensive annual financial report !!!!!! If they would stop stealing trillions they would not be broke.But then they could not complain and sell off our infrastructure to foreigners.
http://video.google.com/videos.....mp;tab=wv#
June 30th, 2009 at 10:17 pm
Bad actors, make bad Governor’s
June 30th, 2009 at 10:19 pm
Cut all money to illegals and start deporting them. This will save untold billions of dolalrs and cut the crime rate 92.3% !
June 30th, 2009 at 11:38 pm
i live in ca los angeles and it seems where in a budget crisis right ? so why not layoff some police and sheriff ? we have enough of them already yet they still hire more . they cut benefits wages , public service except the police whats wrong with this picture ??
June 30th, 2009 at 11:57 pm
…and then we have our governor http://www.michigan.gov/gov…with her finger on the pulse of everything cutting edge in economics and politics, who offers to take on some of California’s prisoners for a price…http://www.clickondetroit.com/news/19895394/detail.html
All I can say is…ZZZzzzzZZZZzzzz…asleep at the wheel!
WTF is wrong with her, all she can look forward to is getting one of those infamous I.O.U.’s from him.
June 30th, 2009 at 11:59 pm
Start Taxing the Skunk Bud Arnie!!!!
July 1st, 2009 at 1:13 am
Just pave the whole fuckin’ state and call it a day!!! “All ‘HAIL’ Thermal Expansion!!!”
July 1st, 2009 at 2:20 am
Shit. I have been hearing how California will have a great earthquake and fall into the ocean since the 1950’s. Enough already! Just fall into the ocean. I lived there for a few years. Oh, how happy I was to finally save enough money to move away and return to sanity. I’m sorry Rincon and Los Coyotes Indian friends, but, your homeland sucks. And if you folks were smart, you would leave and make new treaties with the U.S. government. Besides, your old treaties suck and you were taken for a ride. There’s nothing worthwhile for you there. You got worthless lands, lands that cannot support life without government handouts. I appreciate your anger. But I fail to understand why you remain. And not only that, the white, fat, blonde, stupid women you have babies with do not further your race. It just dumbs it down more. Hey, Crinney, I know more about your traditions than you do. My Seneca visions are true. Yours are just bunk and you go back to a time when you were not even born and you live in the past. Wake up, western Indians! The time for playing cowboys and indians is over. It’s time to prepare a path for all races. Just like your ancient wise men predicted.
July 1st, 2009 at 3:42 am
http://www.expansions.com/News.cfm
July 1st, 2009 at 5:15 am
control, that’s why tey won’t do it.
i think it’s damn funny that the likes of pelosi are hanging california out to dry. go ahead california, vote the same people back in, the rest of the country is gonna get new leaders.
vive la revolution!
July 1st, 2009 at 9:34 am
Legalize it
July 1st, 2009 at 9:39 am
There really is an easy solution,the only thing you may have to worry about is the PRC not being willing to invest.
Release the huge oil reserves of California to the Chinese. If we got out of the way and let the PRC develop the drilling rigs and pump the oil, they will take it offshore and refine it and then be able to sell it on the World market.
In return China and other foriegn investers could pay off The United States Debt and the Debt of California.
July 1st, 2009 at 9:59 am
The best thing that could happen to California is…………………..If it had an Earth-quake and slid into the Ocean.
That would take care of China as well. Hmm? And maybe even Russia!
July 1st, 2009 at 10:06 am
“Release the huge oil reserves of California to the Chinese”
Why don’tcha just move there? Hey maybe we can give them New York while we are at it?
That wouldn’t be to big a loss though.
Hey maybe we should give China, Alaska also? Idiot!
Give the Chinese Californias Oil fields/ yeah! great Idea genius! And then we can pay $10 a gallon Gas!! DUH!
July 1st, 2009 at 10:13 am
great idea! spread this idea around.
July 1st, 2009 at 10:14 am
Hey I have a GREAT IDEA! Let’s demand every American go to the beaches of Californification and pull down their pants, kneel in the doggy position, and let China butt fuck us in the ass. Maybe they’ll forgive Us Our debt ?
Oh that’s right? It’s Our own Government that got us here by fuck’in Us up the ass to begin with.
No matter! We should be used to it by now…….bend over AMERIKA!
July 1st, 2009 at 10:24 am
Oh I’m sorry Janitor/ I forgot! New York is Israels…….. China can’t have New Yaaaaawk.
July 1st, 2009 at 10:31 am
No I know! We should send all Our child molesters to China. They can work off our debt to China over there!
NO? Can’t do that. Then the Politicians won’t have anyone to exploit for business.
You know ? Making useless laws…….
We need more of them don’tcha know? More laws that is?
Like? There isn’t enough? Ever visit a State Law library? (Rolls eyes)
July 1st, 2009 at 10:37 am
obama the fucking monkey will bail out all of these corrupt banks but not help californa FUCK YOU
July 1st, 2009 at 10:48 am
Jekyll Island Presentation (Audio Presentation)
What is the Federal Reserve System? How does it operate? Who conspired to create it and what is the ultimate price WE pay? The Creature from Jekyll Island tells the story you haven’t heard. Here is an audio presentation, given by G. Edward Griffin himself, shortly after publishing “The Creature” in 1994.
http://0101.netclime.net/1_5/2.....eature.mp3
July 1st, 2009 at 11:37 am
after all funding the re-education camps and continuing to poison the youngins minds is numero uno..right Arnie?
July 1st, 2009 at 12:04 pm
Yes this makes a lot of sense. Lets have California set up its own state bank so when the collapse finally comes millions will starve very suddenly and quickly. Why not we make this collapse as ugly as possible that will cause millions to die here in the USA>
July 1st, 2009 at 12:55 pm
Really? Production has been systematically moved out of the United States and expensive penniless refugees from drug-lord controlled Mexico are being allowed to pour by the many thousands into Calif. and being put on the state welfare roles — and yet creating ‘money’ out of nothing is somehow going to solve the state’s basic problem of living beyond its means?
So, the basic idea is for each troubled state to become a little counterfeiting operation, like the one operated since 1913 by the Fed and US govt. working as partners — howsomever, that counterfeiting operation is in trouble – right? Big trouble, having enabled so much federal-govt. deficit spending that all of ‘us’ are now willy nilly in debt even unto x (the number of the indebted generations keeps growing) number of future, of yet unborn, generations?
But, you say, just create that money-out-of nothing, BUT don’t charge the public any interest on it, and all will be well? With that one little change of not charging the public interest on the ‘money-for nothing’, CREATING ‘MONEY’ OUT OF THIN AIR IS GOING TO SOMEHOW SOLVE THE PROBLEM OF HAVING MORE OUTGO THAN INCOME?
I thought all that created was inflation – ie, a diminished purchasing power of the currency being created out of nothing in whatever amount needed to ‘pay the bills.’ Create enough of it and you’ve got hyperinflation. It’s just the law of supply and demand – the supply of ‘money’ goes up, and its purchasing power goes down. Don’t need a Ph.D. in economics to understand that.
Let’s review… the fed govt. and the private bankers creating ‘money’ out of nothing has in 100 years damaged the value of the dollar such that no nation wants it anymore… and yet somehow doing the same thing – WITH THE ONE DIFFERENCE OF NOT CHARGING INTEREST ON THE VALUELESS ‘MONEY’ THAT IS CREATED OUT OF THIN AIR … just not charging interest on the counterfeit ‘money’ is going to make this ‘money-for-nothing’ scheme somehow fly, somehow work, SOMEHOW SOLVE THE BASIC PROBLEM OF LIVING BEYOND ONE’S MEANS, whether one is an individual, or a state, or a country? Creating ‘money’ out of nothing is going to solve the basic problem of living beyond one’s means? (And, it is humanly possible to have that power to create money out of nothing and NOT abuse it, just so long as your name is ‘government’? Get real, dudes! That bridge won’t sell.)
Lincoln’s ‘greenbacks’ are cited by ‘funny money YES! just make it non-interest-bearing’ advocates (”Moneymasters”, Ellen Brown, and Co.) as being such a ’success’. REALLY? Lincoln’s greenbacks, non-interest-bearing ‘money’ created out of nothing, inflated – lost 40-some % of their nominal value – in only 4 years or so. THIS IS A SUCCESSFUL, a viable, CURRENCY? That means that whoever was holding their wealth in those greenbacks lost 40% of that wealth in only about 4 years. Wowza – where do I sign up for that?
Or rather, how do I sign out of it. Answer – do NOT denominate your wealth – including your labor, the only wealth most of us possess – in any fiat currency. What? You say by law I HAVE TO, have to denomenate my labor in an intrinsically worthless fiat currency, because every currency in the world is now intrinsically worthless, its value manipulated – ever downward – by spendy governments and ever richer central banks working in tandem? And somehow just making those fiat currencies NON-INTEREST BEARING is going to solve all our economic woes, somehow balance all these unbalanced books of all these debt-ridden nations? Uh-huh. Makes sense. Yup. Sure does.
The ‘Continental’, the non-interest-bearing unbacked fiat currency of the nascent US of A, lost so much of its value that it was immortalized in that phrase still known to (if not understood by) most of us, dumbed down though we are – ‘not worth a Continental.’
And yet Ellen Brown and the Moneymasters creators would have us believe that this basic plan is gonna work – somehow – ‘this time.’ Ya sure you betcha. Honey, I’d sooner trust my great-aunt Maude with the power to created money-out-of-nothing than I would any government or banker-type suit. They’re from the government (and if you got government, you got them banker-fellers, just like if you got honey, you got flies and if you’re a dog, you got fleas) and they’re here to help…
July 1st, 2009 at 1:34 pm
So Cali would be lending money to itself? I like the idea, but the North Dakota bank example seems to be loaning money to private enteriprises, not more government.
July 1st, 2009 at 3:03 pm
But the greatest menace to our civilization today is the conflict between giant organized systems of self-righteousness — each system only too delighted to find that the other is wicked — each only too glad that the sins give it the pretext for still deeper hatred and animosity.
July 1st, 2009 at 8:52 pm
I live in CA, here all the white guys are to busy buying ammo to care about the state anymore, we all know what that means.
July 1st, 2009 at 11:01 pm
PURGE THE SYSTEM!!!!
I have a better solution for all the states who are facing these problems…..BANKRUPTCY COURT!!
if these losers cannot make the tough choices let a judge PURGE IT IN bankruptcy court.
July 2nd, 2009 at 12:35 am
Hi I would like to say something about this article. Have this person or people ever read the Karl Marx Communist Manifesto? If they ahd they would realize that this could lead to complete control of credit into the hands of the government. Something Karl Marx called for(I beleive it is in his ten planks) The only moral and ethical thing for the California gov. to do is to stop doing all of those things that are (probubly) uncondtitutional for the state to be doing.
Beleive it or not the only way to rescue the state is to do away with it’s oppressive tax system like it’s state income tax for instance. This will bring business back into the state and in the long run fill in the state coffers.
I can understand the writers opinion though, but I would be very carefull. There is a provision in the Constitutions though that would let the state print money and that is the provision that say that the states can only make Gold and Silver a paymentfor dept. So I suppose that if the state wanted to print Gold and Silver certifactes they could do so and opt out of the Fedral Reserve System (which is niether federal nor a reserve) and get ut of dept that way.
July 2nd, 2009 at 3:37 pm
All heil the mightyy ARRNold! An Actor used as Government puuppett to control Califorrnia..
“We should starrt a 25 hour fitness..to give that extra hour to PUMPpp you UPP.!
FUCKIN NAZI SCUM!!