…a good idea or just a scheme to get money into the stock market for the benefit of the market and corporations?..a good idea or just a scheme to get money into the stock market for the benefit of the market and corporations? (”)
There are only 2 ways to gain a profit on the money one invests in the Stock market.
enter into the magic world of compound interest.
2. You may gain a profit through a rise in the price [value] of the stock that you
have invested in. But, you must sell your stock to get the gain thereby losing your
investment. Keep in mind that the price [value] of your stock can go down as well
as up. You may lose all that you invested.
We should have learned that lesson from the $30 billion stock market crash in 1990. The $30 billion number came from the Congressional Reserch Service through a letter from Senator Mark Dayton’s office. From that same letter we read:
“Congress was able to handle a $30 billion stock market crash in 1990 by authorizing the printing of additional money. With that money the Federal Reserve was able to
create a floor which gave investors confidence and allowed the stock market to rebound from the crash.” How did it create a floor? How did the floor function? Who
benefited from selling stock in exchange for the money the government created?
If Congress could print additional money to put a ‘floor’ under the stock money why can’t Congress print the addition money needed to shore up social security? Through the magic of Compound Interest it’s said that we could earn much more than the
historical 2.5% on our Social Security ’investment’ by putting those payments into
personal retirement accounts rather than the government ‘pool’.
Let’s take a close look at‘Compound Interest’
Often we are told of the wonderful power of compound interest (earning interest on both principal and previous interest) and how compound interest can make a modest investment grow into a great amount. For example: If you invested $10,000 in payments to your social security retirement account at 7% compound interest for 30 years; you’d expect your investment to grow to $76,122.52! Sounds Great! Compound Interest must truly make money grow!
For a moment, let’s step out of the dream world hype of banking, financial planning and Wall Street. Just HOW DOES MONEY GROW? Where does the interest money come from? When you put money into an interest-bearing account, does it turn into something like rabbits that mate and quickly reproduce? What happens? The increase of money in your account had to come from someplace. To understand financial planning, economics, growing public and private debts, ever increasing taxes and prices, etc. we must learn and always remember what it is we now use for money and how ALL new money is created and put into circulation. “..the actual creation of money always involves the extension of credit by private commercial banks.” —Russell L. Munk, U.S. Treasury Dept.
If the private sector doesn’t borrow it, the government must or the money cannot exist. If you invest $10,000 in payments to your Social Security account and 30 years later get $76,122.56; somewhere, someone in the private sector or the government had to borrow $66,122.56 before it could get into your account! Now, you have the money. They have the debt which can never be paid because there is no way to create the interest money when money is created through the lending process. Therefore, the debt must constantly grow.
Some claim that the interest money comes from increased production (worker productivity). But, when was the last time your personal production (goods and services) turned into money? Did you ever wave a magic wand over a shoe, shirt, bushel of corn, a new car, an hour of labor etc. and see it turn into money?There are only 2 ways to get money from what we produce.
# 1: We can use our produce as collateral for a bank loan which creates the new money.
# 2: We can sell our production to someone in exchange for money that was created as a loan.
Production NEVER turns into money.
Creating money as interest-bearing loans
ONLY CREATES THE PRINCIPAL, NEVER THE INTEREST!
The interest must be borrowed too!
“Money for paying interest on borrowed
money comes from the same source as
other money comes from.”
—Russell L. Munk, U.S. Treasury.
“Money that one borrower uses to pay
interest on a loan has been created
somewhere else in the economy by another loan.”
— John M.Yetter, Attorney-Advisor, U. S. Treasury.
Interest is never created as money, only as a debt, (interest is always a cost of doing business) that is constantly added into prices that are expected to be paid in money. This the reason that we have a $40 Trillion Debt but only a $1.4 Trillion M1 Money Supply. This makes it increasingly difficult to meet the rising cost of living. We work longer, harder, for less purchasing power.
For every Social Security ‘investor’ to get a greater return there must be a constant rise in the total indebtedness and a constantly growing gap between the prices and the money supply. A bigger return on private Social Security contributions means the money will have less purchasing power than it did for past recipients!
America’s money was intended to represent someone’s production ‘monetized’ (declared money) and exchanged into circulation as a wealth to the people. This totally debt-free medium of exchange provided for and encouraged economic freedom. The principle by which we put all new money into circulation has been changed. Now our money represents our production monetized as unpayable debts placing us in economic servitude. Someone borrowed every penny in circulation including your paycheck or it could not exist. The loan only creates the principal. More borrowing is required to pay the interest. To have Social Security, we must ‘save’ some of the borrowed money. But, time only increases the indebtedness (compounding interest on the borrowed money.) Time does not increase the money supply. Unless we convert our money back to an evidence of wealth; there will be nothing but debt and a constantly lowering standard of living to pass onto our children.
Under the monetary principles of the 1792 Coinage Act, when a person labored to get gold and silver bullion, they could take it to the U.S. mint. The mint would ‘monetize’ it by assaying, weighing and stamping the bullion into coins. The producer would leave the mint with the same bullion he took in now ‘monetized’ in the form of coins that would pass from hand to hand as our medium of exchange representing the wealth of the people as a wealth to the people.
The quickest, most effective way for America to convert to a wealth money system is to have the federal government ‘monetize’ America’s public Roads, Bridges and transit systems. How? Clearly, you cannot stamp a picture on a piece of road and carry it around in your pocket! But, certificates’ can be created ‘representing’ the bid value of the road work. Think of them as ‘silver certificates’ representing’ the value of the silver coins. The certificates circulated as money–NOT THE SILVER.
Social Security ‘dollars’ would buy a lot more if the unpayable compounding interest debt did not need to be added to the prices of goods and services. Americans would not even need Social Security if the unpayable compounding interest debt didn’t constantly destroy the purchasing power of a ’dollar’. In addition, when all we use for money is loan principal it may be possible for some to save but not everyone.
A large Lobby stands to gain much in sales commissions from privatization of these
‘funds.’
Private SOCIAL SECURITY Accounts are not a good idea and will not solve the
growing ‘money shortage.’
Remember your investment portfolio after 911? Money does not grow! Currently, the money supply can only be increased through additional borrowing. Only the Principal is created, never the Interest. The Principal is ‘uncreated’ when it is repaid.
Money can’t reproduce it self!
Money does NOT Grow!