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Thread: Buying Up the Planet: Out-of-Control Central Banks on a Corporate Buying Spree

  1. #1

    Buying Up the Planet: Out-of-Control Central Banks on a Corporate Buying Spree

    I used to think our central bank was our central bank and all of the devaluation of the dollar could be accounted for by the debt our country gets in to by trading bonds for cash.

    Then I started wondering how much the central banks might be printing to manipulate politics.

    A harsh realization came when an audit showed they had made a loan of about 16 trillion to banks and others outside of the country on their own.

    We really need to take a look at our pig-in-a-poke.



    Buying Up the Planet: Out-of-Control Central Banks on a Corporate Buying Spree

    When the US Federal Reserve bought an 80% stake in American International Group (AIG) in September 2008, the unprecedented $85 billion outlay was justified as necessary to bail out the world’s largest insurance company. Today, however, central banks are on a global corporate buying spree not to bail out bankrupt corporations but simply as an investment, to compensate for the loss of bond income due to record-low interest rates. Indeed, central banks have become some of the world’s largest stock investors.

    Central banks have the power to create national currencies with accounting entries, and they are traditionally very secretive. We are not allowed to peer into their books. It took a major lawsuit by Reuters and a congressional investigation to get the Fed to reveal the $16-plus trillion in loans it made to bail out giant banks and corporations after 2008.

    What is to stop a foreign bank from simply printing its own currency and trading it on the currency market for dollars, to be invested in the US stock market or US real estate market? What is to stop central banks from printing up money competitively, in a mad rush to own the world’s largest companies?

    Snip...

    Read the whole article here;

    http://truth-out.org/news/item/24539...e-buying-spree



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  3. #2
    Quote Originally Posted by Carson View Post
    What is to stop a foreign bank from simply printing its own currency and trading it on the currency market for dollars, to be invested in the US stock market or US real estate market? What is to stop central banks from printing up money competitively, in a mad rush to own the world’s largest companies?
    Try it yourself and see what happens.

  4. #3
    Buying Up the Planet: Out-of-Control Central Banks on a Corporate Buying Spree
    What businesses are currently owned by Central banks? Can anybody name any such businesses? The Federal Reserve owns no stocks or shares in businesses. The European Central Bank own none.

    It took a major lawsuit by Reuters and a congressional investigation to get the Fed to reveal the $16-plus trillion in loans it made to bail out giant banks and corporations after 2008.
    The $16 trillion loan figure is highly inflated. Loans made were overnight (one day). If a loan was kept another day, it was counted as another loan. If a bank took out a loan for $1 billion and kept it a month, it was counted not as $1 billion in loans but as $30 billion in loans. Total outstanding loans from the Fed currently total $139 million (yes, million with an "m", not billion with a "b"). http://research.stlouisfed.org/fred2/series/BORROW

    Total Borrowings of Depository Institutions from the Federal Reserve

    2014-05: 0.139 Billions of Dollars (+ see more)
    Monthly, Not Seasonally Adjusted, BORROW, Updated: 2014-06-19 4:52 PM CDT
    Last edited by Zippyjuan; 06-25-2014 at 11:50 AM.

  5. #4
    So would it make sense for us to buy a house right now then after the FRNs have lost world reserve currency status? Even though the housing market might be going to boom levels of 2K7 in places like NYC/NJ we can still secure a loan @ low interest rates. Also once reserve status is lost you will be paying back the loan in money that is less worth then it was when you bought the house. Right now housing market is heating up in Jersey due to low interest rates but once rates go up ppl say prices will go down. I think in the long term the prices will have to go up to compensate for the loss of reserve status. What you guys/gals think?

  6. #5
    If you are considering buying a home and find one you like and can afford- go for it. Don't worry about what you think MIGHT happen in the future (unless part of that future concern is possibly losing your income to pay for the house). Costs of waiting could include:

    1) continuing to pay rent- giving that money away for nothing when it could be starting to reduce the principal on a mortgage and accumulating value in the home.

    2) Buying now means you will also be closer to the time you have the home paid for and your housing expenses (except property taxes) goes to zero- lowering your cost of living. Renting can't do that for you.

    3) possible higher interest rates in the future- interest rates are still near historic lows. Higher rates will mean higher payments for the exact same home at the exact same price.

    4) What if housing prices don't go down in the future? You end up paying more for the same place. Historically, housing prices have followed the overall rate of inflation and declines like we saw after the housing bubble are rare events. (So was the bubble itself).

    5) What if housing prices DO go down in the future? Doesn't matter unless you decide to sell yours at that time. What if you bought gold or stocks and their value went down? Again, doesn't matter unless you are selling then. Just keep paying on your mortgage. If interest rates go down enough, then consider refinancing (unless you are far along in making payments).

    I bought my home just at the start of the bubble (in 1999). A friend noted the bubble (as did I) and suggested I sell my place and wait for prices to fall and buy it back again. Had I listened to him, I would not have been able to buy it back at the price I purchased it at and assuming I sold when he suggested I did, I would have not made money off that transaction either. Instead I would be farther away from paying it off (I have already paid it off) and be paying more than twice what I currently am in property taxes (since the price never dropped below twice my original purchase price). Glad I ignored his advice. Now my disposable income is 25% higher than it would be without buying a home.

    I don't think "reserve status" will have any effect on prices of US homes unless there is some global rejection of the US dollar which would involve a major economic crisis which would itself effect home prices. That would have zero impact on my decision to purchase a home. Good luck with your decision!
    Last edited by Zippyjuan; 06-28-2014 at 01:27 PM.

  7. #6
    If I could print my own money out of thin air and have it accepted, I'd buy up the whole world too. I think a one quadrillion dollar bill would easily cover it with some significant change due back.

  8. #7
    So how many businesses does the Fed own? (none)

  9. #8
    Quote Originally Posted by Zippyjuan View Post
    So how many businesses does the Fed own? (none)
    Care to speculate on how many businesses owned by the Rothschilds?



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  11. #9
    Quote Originally Posted by Ronin Truth View Post
    Care to speculate on how many businesses owned by the Rothschilds?

    According to company 10K filings to the SEC, the Four Horsemen of Banking are among the top ten stock holders of virtually every Fortune 500 corporation.[1]

    http://www.globalresearch.ca/the-fed...families/25080

  12. #10
    Quote Originally Posted by Zippyjuan View Post
    If you are considering buying a home and find one you like and can afford- go for it. Don't worry about what you think MIGHT happen in the future (unless part of that future concern is possibly losing your income to pay for the house). Costs of waiting could include:

    1) continuing to pay rent- giving that money away for nothing when it could be starting to reduce the principal on a mortgage and accumulating value in the home.

    2) Buying now means you will also be closer to the time you have the home paid for and your housing expenses (except property taxes) goes to zero- lowering your cost of living. Renting can't do that for you.

    3) possible higher interest rates in the future- interest rates are still near historic lows. Higher rates will mean higher payments for the exact same home at the exact same price.

    4) What if housing prices don't go down in the future? You end up paying more for the same place. Historically, housing prices have followed the overall rate of inflation and declines like we saw after the housing bubble are rare events. (So was the bubble itself).

    5) What if housing prices DO go down in the future? Doesn't matter unless you decide to sell yours at that time. What if you bought gold or stocks and their value went down? Again, doesn't matter unless you are selling then. Just keep paying on your mortgage. If interest rates go down enough, then consider refinancing (unless you are far along in making payments).

    I bought my home just at the start of the bubble (in 1999). A friend noted the bubble (as did I) and suggested I sell my place and wait for prices to fall and buy it back again. Had I listened to him, I would not have been able to buy it back at the price I purchased it at and assuming I sold when he suggested I did, I would have not made money off that transaction either. Instead I would be farther away from paying it off (I have already paid it off) and be paying more than twice what I currently am in property taxes (since the price never dropped below twice my original purchase price). Glad I ignored his advice. Now my disposable income is 25% higher than it would be without buying a home.

    I don't think "reserve status" will have any effect on prices of US homes unless there is some global rejection of the US dollar which would involve a major economic crisis which would itself effect home prices. That would have zero impact on my decision to purchase a home. Good luck with your decision!




    I think I will buy in Texas..

  13. #11
    Quote Originally Posted by AFTFNJ View Post
    According to company 10K filings to the SEC, the Four Horsemen of Banking are among the top ten stock holders of virtually every Fortune 500 corporation.[1]

    http://www.globalresearch.ca/the-fed...families/25080

    http://www.usagold.com/publications/federalreserve.pdf

  14. #12
    Quote Originally Posted by AFTFNJ View Post
    According to company 10K filings to the SEC, the Four Horsemen of Banking are among the top ten stock holders of virtually every Fortune 500 corporation.[1]

    http://www.globalresearch.ca/the-fed...families/25080
    I would expect large Mutual Fund Companies to also be on that list. They are investment firms and hold those shares for their clients. They don't "own" all those shares for themselves.

    From the article:
    The Four Horsemen of Banking (Bank of America, JP Morgan Chase, Citigroup and Wells Fargo) own the Four Horsemen of Oil (Exxon Mobil, Royal Dutch/Shell, BP and Chevron Texaco); in tandem with Deutsche Bank, BNP, Barclays and other European old money behemoths. But their monopoly over the global economy does not end at the edge of the oil patch.
    Really? Own them? Not just are majority share holders? But are they even major shareholders? Do they even make the Top 20 list?

    Let's check the first stock in the article- Exxon Mobile. List of largest share holders:
    http://investors.morningstar.com/own...nerCountry=USA

    1) Vanguard Total Stock Market Index (disclaimer- I hold shares in this fund)
    2) Vanguard 500 Index
    3) Vanguard Institutional Index
    4) SPDR S&P 500 Index
    5) SSgA S&P 500 Index Strategy

    Not going to post whole list but interestingly I don't see ANY of the "Four Horsemen Banks" from the article listed in the Top 20 list at all. Where are they?

    Next on their list is Royal Dutch Shell. Owned by the major banks? http://investors.morningstar.com/own...r.html?t=RDS.B

    Hmm. Not on that list either (Royal Bank Canada is the only bank listed).

    Not going to do the entire Fortune 500 but seems like their information is not correct at all.
    Last edited by Zippyjuan; 06-28-2014 at 02:56 PM.

  15. #13

    It true that there are "stock shares" banks own in the Federal Reserve but those are not like typical stock shares. They come with no control over the Fed. They have no voting rights. They cannot be sold to anybody else. They are really a "membership fee" into the Federal Reserve Banking System. In order to join, a member bank must put up ten percent of their total assets as collateral. In exchange, they are given those shares. Again- they cannot be traded or sold. The shares do allow banks access to Fed services (kinda like you joining a Credit Union- you are a member which gives you access to their services but not an owner- your "collateral" is the deposit you make with them) and do pay an annual dividend of six percent but are not any form of "ownership" of the Fed.

    http://www.federalreserve.gov/faqs/about_14986.htm

    Who owns the Federal Reserve?

    The Federal Reserve System fulfills its public mission as an independent entity within government. It is not "owned" by anyone and is not a private, profit-making institution.

    As the nation's central bank, the Federal Reserve derives its authority from the Congress of the United States. It is considered an independent central bank because its monetary policy decisions do not have to be approved by the President or anyone else in the executive or legislative branches of government, it does not receive funding appropriated by the Congress, and the terms of the members of the Board of Governors span multiple presidential and congressional terms.

    However, the Federal Reserve is subject to oversight by the Congress, which often reviews the Federal Reserve's activities and can alter its responsibilities by statute. Therefore, the Federal Reserve can be more accurately described as "independent within the government" rather than "independent of government."

    The 12 regional Federal Reserve Banks, which were established by the Congress as the operating arms of the nation's central banking system, are organized similarly to private corporations--possibly leading to some confusion about "ownership." For example, the Reserve Banks issue shares of stock to member banks. However, owning Reserve Bank stock is quite different from owning stock in a private company. The Reserve Banks are not operated for profit, and ownership of a certain amount of stock is, by law, a condition of membership in the System. The stock may not be sold, traded, or pledged as security for a loan; dividends are, by law, 6 percent per year.
    Profits the Fed takes in (from their Treasury and Mortgage Backed Security holdings along with interest from bank borrowing from the Fed and other service fees the Fed charges) are turned over to the US Treasury (after subtracting out their expenses) at the end of the year. They don't keep them or pass them along to the "member banks".
    Last edited by Zippyjuan; 06-28-2014 at 02:14 PM.

  16. #14
    So how was Fed conceived at Jekyll island and which group of PPL? Please refresh our memory.

  17. #15
    "merchants of the earth" let google educate you about the phrase. It will open your eyes.

    http://www.benwilliamslibrary.com/pd...ntsofEarth.pdf
    Last edited by mrsat_98; 06-29-2014 at 04:28 PM.
    “[T]he enshrinement of constitutional rights necessarily takes certain policy choices off the table.” (Heller, 554 U.S., at ___, 128 S.Ct., at 2822.)

    How long before "going liberal" replaces "going postal"?

  18. #16
    Quote Originally Posted by AFTFNJ View Post
    So how was Fed conceived at Jekyll island and which group of PPL? Please refresh our memory.
    http://www.pdfarchive.info/pdf/G/Gr/...yll_Island.pdf



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  20. #17
    Also keep in mind the Banks and Fannie Mae/aka Feds conspired to steal approx. 20 million homes so far in illegal foreclosures as well as the equity contained therein through the illegal foreclosure schemes they received a slap on the hand for. Of course those millions of families did receive a check for $600. or so in the National Foreclosure Settlement to reimburse them for the inconvenience they have suffered as a result.

  21. #18

    Exclamation




    Hey so the bankers do own everything by proxy eh? Zippy Any input?

  22. #19
    Quote Originally Posted by Zippyjuan View Post
    So how many businesses does the Fed own? (none)
    Prove it.

    Come on, Mr. Bernanke. No one here ever took anything you said at face value. Prove it.

    Besides, this statement doesn't mean a damned thing. The Fed can buy the nation or the world with its funny money, and as long as they have the deeds put in the names of the member megabanks that own the Fed, you can say 'Well, maybe the Fed bought it but the Fed doesn't own it' all day long.

    Quote Originally Posted by Zippyjuan View Post
    Profits the Fed takes in (from their Treasury and Mortgage Backed Security holdings along with interest from bank borrowing from the Fed and other service fees the Fed charges) are turned over to the US Treasury (after subtracting out their expenses) at the end of the year. They don't keep them or pass them along to the "member banks".
    What about the profits the Fed takes in (from buying a few pennies' worth of rags and ink and turning it into legal tender)?
    Last edited by acptulsa; 07-01-2014 at 12:22 PM.
    Quote Originally Posted by Swordsmyth View Post
    You only want the freedoms that will undermine the nation and lead to the destruction of liberty.

  23. #20
    Quote Originally Posted by acptulsa View Post
    What about the profits the Fed takes in (from buying a few pennies' worth of rags and ink and turning it into legal tender)?
    That profit is made by the Treasury, not the Fed.

    Seigniorage: Seigniorage (pronounced, CEE-nyer-rij) is the profit a country earns when it issues a currency. It's the difference between the products currency can buy and the cost of printing that currency. For example, a $100 dollar bill is worth $100, but it only costs 4˘ to print. The United States earns about $25 billion per year in seigniorage;
    http://www.banking.senate.gov/docs/reports/dollar.htm

  24. #21
    http://wfhummel.cnchost.com/seigniorage.html

    During the era of metal-based money, the monetary base consisted of precious metal coins. The difference between the face value of the coins and the cost of acquiring the metal and minting them generated a financial benefit for the State treasury, known as seigniorage. In a modern fiat money system the meaning of seigniorage is quite different.

    Seigniorage in a Fiat Money System

    In the U.S. today the monetary base is created by the Fed when it buys Treasury securities from the public and credits a seller’s bank with a reserve deposit at the Fed. Interest paid on Treasury securities acquired by the Fed is the main source of income for the Fed. The Fed keeps enough to cover its expenses, and refunds the balance to the Treasury.

    On average, over ninety percent of the interest received by the Fed is refunded to the Treasury. The refunded amount is a source of spending power for the Treasury which is independent of tax revenues. Thus it is the equivalent of seigniorage for the Treasury. The value of the seigniorage automatically increases as the Fed monetizes Treasury securities to meet the private sector demand for additional cash.

    How the Issue of Notes Affect Seigniorage

    The Bureau of Engraving and Printing in the Treasury produces all notes for the Fed. The Fed buys the notes at cost, and pays by crediting the Treasury's account at the Fed. The Fed provides notes on demand to banks at face value, debiting their accounts at the Fed in payment. Banks provide notes on demand to depositors, debiting their individual accounts in payment. Conversely depositors can return notes to their banks and regain credits in their accounts. Likewise banks can return notes to the Fed and regain credits in their Fed accounts.

    Until the Fed issues the notes to banks, they are not a part of the monetary base, but only engraved pieces of paper stored in the vaults of the Fed. Since the Fed buys notes at cost and “sells” them to banks at face value, it would seem that seigniorage from notes accrues to the Fed. However when the Fed issues or redeems notes with banks, it simply swaps liabilities on its balance sheet. The asset side of the balance sheet remains unchanged. Thus the Fed gains nothing from the “sale” of the notes.

    How the Issue of Coins Affects Seigniorage

    The U.S. Mint, a bureau of the Treasury, produces all coins. It sells them to the Fed at face value for credit in its account at the Fed. The difference between the face value of the coins and the cost of their production is seigniorage for Treasury, which accrues at the time of sale to the Fed.

    Coins held by the Fed are carried on its balance sheet as assets. Those assets vanish when sold to the private sector. The Fed sells the coins to banks at face value, who in turn sell them to the public at face value. This peculiar distinction between coins and notes is a hold-over from the days when the monetary base was precious metal
    The Fed pays face value to acquire notes and coins and sells them to banks also at face value.

  25. #22
    Quote Originally Posted by acptulsa View Post
    Prove it.

    Come on, Mr. Bernanke. No one here ever took anything you said at face value. Prove it.

    Besides, this statement doesn't mean a damned thing. The Fed can buy the nation or the world with its funny money, and as long as they have the deeds put in the names of the member megabanks that own the Fed, you can say 'Well, maybe the Fed bought it but the Fed doesn't own it' all day long.



    What about the profits the Fed takes in (from buying a few pennies' worth of rags and ink and turning it into legal tender)?
    If you want to make the claim that the Fed owns companies, let's see your proof. The burden is on the accuser to make their case. They certainly would not profit from it if they did since they turn all of their net profits over to the US Treasury. Article from January:
    http://blogs.wsj.com/economics/2014/...ury-last-year/

    Fed Sent $77.7 Billion in Profits to Treasury Last Year

    The Federal Reserve sent about $77.7 billion in profits to the Treasury Department in 2013, the result of gains reaped from its unconventional efforts to spur economic growth.

    In 2012, the Fed sent a record $88.4 billion to Treasury coffers.

    The Fed’s portfolio of securities and other assets has swelled to more than $4 trillion since the financial crisis, growth driven largely by several rounds of bond purchases aimed at lowering long-term borrowing costs to spur more spending, investment and hiring.

    Those efforts are now generating large profits as the central bank earns interest on the assets. The Fed in a statement released Friday said it made an estimated $79.5 billion in net interest income, a total largely driven by the $90.4 billion in interest income it made on its portfolio of Treasurys, mortgage bonds and other securities.

    The Fed is required to use its income to cover its operating expenses and send much of the rest to the Treasury’s general fund, where it is used to pay government bills and benefits. The payments to Treasury are called remittances. Fed Chairman Ben Bernanke has said that since 2009, the Fed has sent more than $350 billion to Treasury, about equivalent to the amount it had sent during the entire 18-year period before the crisis.



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