Tuesday, April 15, 2008

Who Insures the Insurers?

The Federal Deposit Insurance Corporation (FDIC) insures bank accounts up to $100,000. The FDIC holds about a penny in reserve (in T-bills) for every dollar worth of insured deposits.

Who insures the T-bills? The Federal Reserve System. Who insures the Federal Reserve System? No one. It doesn't need insurance. It can create money.

Then who insures the purchasing power of the dollar? The central banks of the world, which hold dollars as legal reserves for their own currencies.

What happens if they decide not to add to their holdings of dollars?

[What we can look forward to includes:] rising prices for imported goods, rising domestic interest rates because foreign central banks are not buying Treasury debt any longer, unemployment, bankruptcies, defaults.

And when the checks from Washington no longer buy much of anything, the great political transformation will begin.

[Excerpt of an article by Gary North]

5 comments:

Charles said...

You know, it is amazing that people believe this propaganda.

Christians know that the Word of the Lord is going to cover the earth as the waters cover the sea.

People sometimes have their focus on one country, like America, and think God revolves around it.

He's got the whole world in His hands, and if you are a True Believer of His Precious Promises, you will not believe things that are contrary to the Word of God like this Anti-American propaganda is.

All The Best.
CEB

Grant Montgomery said...

Thank you for sharing your opinion, Charles.

I very much agree with you that He's got the whole world in His hands, and likewise that by no means does God revolves solely around America.

Having said that, I don't understand what exactly you are referring to in this article that is "contrary to the Word of God". And I would appreciate if you could share any passages from the Bible that you might base this on. Thanks!

Charles said...

Thanks for your reply. First of all I was amazed that your articles all seem to be negative.

Maybe you see things that way for some reason, or perhaps you either ignored the positive articles, or didn't see them, or aren't interested in the articles that reveal that the economy is getting stronger, even as I write.

As far as Bible verses, the Bible says to publish the Good News of the Kingdom, and whatsoever things are Good, whatsoever things are Honest, whatsoever things are Pure, and of Good Report,

The Bible says to dwell on these things and not all the negative.

We can actually cause some of these negative things to happen, if all we are dwelling in is the negative.

I believe that prayer changes things, and it is God's will to pray.

I do not believe we should just take a passive attitude and "LET" these bad things happen, but do all we can to pray that they don't, and that the siutuation gets better.

God loves His children, and honors and blesses those hwo honor and bless Him.

He has more outstanding promises for those who love Him, and are the called according to his purpose.

He promises a glorious future for All of His children, and a Victorious Life for those who believe that "no weapon formed against you will prosper"

God loves and blesses His children, and no longer deals with nations as a whole, but after Jesus came,and died for the sins of the whole world, He now deals with us on an individual basis "According to your faith be it unto you"

And "without faith it is impossible to please God"

I see this even in my own family.

Whatever misfortune or disaster you see in america or anywhere else, contrary to what many think, it is not God doing it, or "allowing" it as a chastisement or judgment.

The Bible simply says that what we sow we will reap, and there are automatic consequences for sin, and we live in a fallen world, and also calls Satan "the destroyer" not God.

So there are a lot of factors working together as well as natural causes, weather cycles, etc that cause the various fluctuations we seem to see every generation.

How about publishing some of the more positive and encouraging financial news? he he (smile)

All The Best
CEB

Grant Montgomery said...

Charles,

Yes, we are to publish the Good News but I think that is in reference to the Gospel. The fact is that this is a site about current economic events, and so in that regard there is obviously a lot of “bad” news happening daily, again the focus of this blog as times wax worse and worse. As to whether the economy improves or not, guess time will tell.

I do feel that the economic woes being experienced by this nation are indeed part of God’s chastisement. In the Old Testament you’ll recall that all the plagues struck at Egypt’s idols. Seems the popular “idol” of the day may be the Almighty Dollar?

While I agree with you that God deals with individuals, I don’t think that He is out of the business of allowing circumstances that affect whole nations, so as to see how both individuals and governments etc of those particular nations react, and we are all individually and collectively weighed in the balances accordingly.

Lest there are any misunderstandings on this issue, I am not saying that God is the one bringing or causing these things. But I do think He is allowing America’s economic woes as a chastisement.

And as far as the “negative-ness” of these posts, as one studies the writings of the prophets prophesying against Israel of old for example, or John the Baptist speaking out against the politics of his day, I think one might conclude that that these too might be considered a “negative” message? Sometimes delusion must be destroyed in order for individuals to gain a firm foundation of truth.

Grant Montgomery said...

P.S. - Concerning the “economy getting stronger” as you refer to, I grant you the U.S. economy has showed positive growth for the last quarter.

However I think it is premature to say the recession is over. This would be like the story of the man who jumped out of a window 60 floors up, and then said "so far, so good," as he passed the 30th floor.

For example, America accumulated a massive, $8 trillion housing bubble during the decade from 1996-2006. Only about 40 percent of that bubble has now deflated. House prices are still falling at a 20 percent annual rate. Which could mean that the worst is yet to come.

With oil prices hitting record highs, and the Fed beginning to worry more about inflation, more restrictive lending practices and other fallout from the credit crunch, the near-term economic future doesn’t look great.