The Dollar is a Ponzi Scheme

in #government4 years ago


American monetary policy is a glorified Ponzi scheme. According to a YouTube channel called moneyandsociety (, a Ponzi scheme is "an investment arrangement in which investors are promised low risk and high returns." This is simply the basis for operating the Ponzi scheme. It's just one descriptive aspect of the scheme, but it's a good place to start a comparison. The scam functions by paying off past investors with capital from new investors. Keep both its function and basis in mind while we compare the scam to the state's monetary policy. Ponzi schemes are basically untenable as the new investment is eventually insufficient to cover the outstanding costs of operation.


The rudimentary design of our money dictates that the origins of most dollars are actually in the purchase of U.S. Treasury bonds. The purchase of these bonds are essentially loans from the purchaser to the government for profit. This is our low risk investment. The central bank of the United States, The Federal Reserve, is the largest purchaser of the bonds, and thus, the largest investor for the government, which will, in turn, pay them back with our income taxes; all of them. It creates its own currency to make the purchases based on faith that there are other entities that will continue to invest in the funding of the American government as well, for if and when that ceases to be the case, when people stop lending the government money, it's currency will collapse. It will be worthless paper. The Fed, as the central bank is referred to by some, is a publicly chartered cartel of private banks, and they operate by essentially counterfeiting money through loans. Yes, you read that correctly; the dollar is created out of the loan process, and those that are in the position to profit from the scam hedge their bets by literally making money. They have the printing press, so to speak. The Federal Reserve system is a front for private fiat counterfeiters.


We can see that bond purchases serve as the catalyst for the creation of our debt-based currency, but there is another similar way to create even more money in which the average person is involved too! It's called "fractional reserve lending".

Fractional Bank Reserves

When you deposit your money into a bank account, IT'S NO LONGER YOUR MONEY! It's become part of that bank's "reserves". You just lent it to the bank which is going to operate the same scam as the larger, previously discussed scam operated by the central bank. The term "fractional reserve" is referring to the rules that govern this psuedo-legitimized process, which will constitute a theoretical limitation on the expansion of the overall money supply.

"Modern Money Mechanics" is the name of a booklet released from the Federal Reserve describing "...the basic process of money creation in a 'fractional reserve' banking system." Also, according to the document "Of course, they [banks] do not really pay out loans from the money they receive as deposits. If they did this, NO NEW MONEY WOULD BE CREATED." (my emphasis) This establishes the fact that money is, in fact, created by the loan process. It is immediately followed with a description of what actually does occur. According to the document, "What they do when they make loans is to accept promissory notes [contracts] in exchange for credits [money] to the borrower's transaction accounts." The money is created out of thin air.


When compared to a commonly recognized Ponzi scheme, the Dollar's similarities are striking, to say the least. We've established that the government, the central bank, and the web of international commercial banks in business with the Federal Reserve system are borrowing money and paying off lenders (depositors) with money that's been lent into existence and deposited back into the fractional reserve banking system based on the faith that others will continue to lend money to the government which operates the overall scam.


Is There No End to the Madness?

One restriction on this blatant counterfeiting is known as a fractional reserve requirement. According to, "Net transaction accounts in excess of the low reserve tranche are currently reservable at 10 percent." This means that out of all of the money loaned into existence by almost any given lending establishment, those individual lending establishments are only required to have ten percent of the currency on hand. No less than ten percent, as opposed to ALL, of their customers' assumed cash deposit is being held by the bank as available currency at any given time. This is what the word "fractional" refers to, and ultimately, what makes possible a "run on the bank".

The application of interest compounds the problem. When the money supply comes into existence by loans, only the principal is being lent, so where would the money come from to cover the interest? It must be loaned into existence. This process does not only cause a debasement of the currency, but it enssures bankruptcy for individuals not receiving the newly created money, and the resulting implications like foreclosure. It works like a siphon for the capitalists in this system to obtain the fruits of others' labor by FRAUD.

"Can this really go on forever?", some of the more astute may ponder. Well, the truth is in why you may have thought to question the evitability of such a scenario in the first place. Those that benefit from a system, as we all currently do, are certain to be interested in its sustainability. I've already explained the untenable nature of a Ponzi scheme, and I know of no magical remedy that the state possesses that would exempt it from the processes of the nature of its own scam.


The cumulative effects of this scam include a devaluation of the dollar by way of inflation as a result of lending money into existence to cover outstanding debts, the illegal processes of mathematically designed and guaranteed foreclosure, and the resulting scenario of banks siphoning the businesses, homes, and vehicles of the victims of this systematic corruption. This is the reason people seek alternative media of exchange for saving their wealth and why nations like Russia and China are limiting their purchase of bonds to degrees less than their returns, because they are exiting the market, because...

the Dollar is a Ponzi scheme.



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