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<p>[QUOTE=&quot;fatima, post: 1300328, member: 22143&quot;] <ol> <li>Thanks for the reply.&nbsp; I will answer in 2 posts</li> <li>Most important.&nbsp; The FRN $ <u>is not backed</u> by US debt from the US Treasury.&nbsp; i.e.&nbsp; A holder of the FRN has absolutely no claim on the US taxpayers.&nbsp; How the Federal Reserve works is confusing because there is a huge amount of obfuscation that implies the $ is backed by the taxpayers, but it isn&#039;t.&nbsp;&nbsp; The USA does create taxpayer Treasury Notes and deposits them at the FR.&nbsp; In response, the FRN deposits the equivalent $s in the Treasury&#039;s account (so to speak).&nbsp; The USA can then spend these dollars.&nbsp;&nbsp; However the Federal Reserve is free to create as many $s as it needs, without backing or oversight so that it can conduct it&#039;s monetary policy.&nbsp;&nbsp; For example, $s created by QE are not backed by Treasury Notes.&nbsp; This misunderstood fact about the currency gives the Federal Reserve enormous power to affect or destroy the economy.&nbsp;&nbsp; The Federal Reserve is not controlled by the Congress or President but rather it&#039;s controlling members are the TBTF banks.&nbsp;&nbsp; </li> <li>Item #2 on your list is invalidated by the point I made in #1.&nbsp; i.e.&nbsp; The Federal Reserve can increase the number of $s to infinity if it likes.&nbsp; </li> <li>Faith in the US economy is highly dependent upon faith the Finance Industry (Insurance, Banking, Wall Street) are regulated as utilities to the economy.&nbsp; This has been destroyed by 20 years of deregulation and lack of enforcement of what rules are left.&nbsp; What happened at MF Global just a couple of weeks ago, at the hands of people who are/have been part of the highest levels of the US Government, is an excellent example of this.&nbsp;&nbsp; There are two possible outcomes:&nbsp; Either the people at the top fix things (unlikely) or the people at the top will get tarred and feathered (literally) by the 250 million in this country who are ending up with nothing.&nbsp;&nbsp; You can&#039;t have a functioning society where all the rewards end up in the hands of the bankers, politicians, corporate executives and government elite.&nbsp;&nbsp; </li> <li>Gold currently functions as the currency of the Central Banks.&nbsp; Much of what they do with it is kept secret and our own head of the Federal Reserve, Ben Bernanke, recently gave sworn testimony to the US congress that gold was not money.&nbsp;&nbsp; Of course he is also a liar.&nbsp; Everyone else, including bullion buyers knows otherwise.&nbsp; It&#039;s another example of the &quot;contempt&quot; these people have towards the rest of us.&nbsp; It&#039;s also a demonstration of the primary fault of central banking. That is, it requires a constant set of lies to make it work. </li> <li>Surely you should realize the GS isn&#039;t impartial in its answer.&nbsp; Private commerce always trumps government control.&nbsp;&nbsp; 70 years of central planning in the Soviet Union proves this.&nbsp; Small Business creates more jobs than anything else, yet a huge amount of government regulations &amp; taxation makes starting a small business extremely difficult and the problems grow exponentially when it tries to hire additional employees.&nbsp; My beliefs on how to fix it go so much against the &quot;common wisdom&quot; that I won&#039;t bother to mention them here. It makes people become unglued. </li> <li>Social Security is not a problem.&nbsp; It&#039;s completely funded by its own tax.&nbsp; The problem is the money collected for SS &amp; Medicare is being used for other purposes.&nbsp;</li> </ol><p>[/QUOTE]</p><p><br /></p>

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