MEDIEVAL EUROPE (1000 - 1100 A.D.) Here we find goldsmith's offering to keep other people's gold and silver safe in their vaults, and in return people walking away with a receipt for what they have left there. These paper receipts soon became popular for trade as they were less heavy to carry around than gold and silver coins.
After a while, the goldsmith's must have noticed that only a small percentage of their depositor's ever came in to demand their gold at any one time. So cleverly the goldsmith's made out some receipts for gold which didn't even exist, and then they loaned it out to earn interest. A nod and a wink amongst themselves and the governments that borrowed the money, they incorporated this practice into the banking system. They even gave it a name to make it seem more acceptable, christening the practice a technical term: 'Fractional Reserve Banking' which translates to mean, lending out most of the money than you have on deposit, and keeping only a fraction in reserve while telling all your depositors they have their money safe with you. Inventing money based on the magic that it can exist in two places at once.
Today banks in America are allowed to loan out more than ten times the amount they actually hold on deposit. The reserve requirement is 10% for “demand” (checking account) deposits, and 0% for savings accounts. For every $10 deposited in a checking account, they lend $9 of it, while leading the depositor to believe they have all of it. The fact of the matter is that $9 likely becomes a new deposit when it is loaned out, and 90% of that is considered loan-able also. So while you wonder how they get rich charging you 10% interest, it's not 10% a year they make on that amount but likely 10% multiplied by 9.999...
THE TALLY STICKS (1100 - 1854)
King Henry the First produced an ingenious monetary system based on sticks of polished wood with notches cut along one edge to signify the amount. The stick was split in half lengthwise so each half still had a record of the notches. The King kept one half for proof against counterfeiting, and then spent the other half into the marketplace where it would continue to circulate as money. Because only Tally Sticks were accepted by Henry for payment of taxes, there was a built in demand for them, which, along with the counterfeit protection, gave people confidence to accept these fancy sticks as money. He could have used anything really, so long as the people agreed and perceived that it had value. His willingness to accept these sticks as legal tender made it easy for the people to agree.
Money is only as valuable as the faith people have in it, and without that faith even today's money is just paper. Even gold is valuable only because we believe it.The tally stick system worked well for 726 years! It was the most successful form of non metallic currency in known history, and the British Empire was actually built under the Tally Stick system, but how is it that most of us are not aware of its existence?
Perhaps the fact that in 1694 the Bank of England at its formation attacked the Tally Stick System gives us a clue as to why most of us have never heard of it. The gold holding elite realized it was money outside the power of the money changers (the very thing King Henry had intended), and their fortunes were shrinking because they could not manufacture wealth so easily.What better way to eliminate the vital faith people had in this rival currency than to pretend it simply never existed and not discuss it? That seems to be what happened after the shareholder's in the Bank of England bought their original shares with these notched pieces of wood and then began to berate the system.
The Bank of England was set up as a privately owned bank through wealthy investors buying shares, with tally sticks no less! Even the Bank of England’s nationalization is not what it at first may appear, as its independent resources unceasingly multiply and dividends continue to be produced for its shareholder's.
The original investors, whose names were kept secret, were meant to invest one and a quarter million pounds, but only three quarters of a million was received when it was chartered in 1694. It then began to lend out many times more than it had in reserve, collecting interest on the lot. This is not something you could just impose on people without preparation. The money changers needed to create the climate to make the formation of this private concern seem acceptable.
Here's how they did it. With King Henry VIII relaxing the Usury Laws in the 1500's, the money changers flooded the market with their gold and silver coins becoming richer by the minute through interest. The English Revolution of 1642 was financed by the money changers backing Oliver Cromwell's successful attempt to purge the parliament and kill King Charles. What followed was 50 years of costly wars; costly to those fighting them but very profitable to those financing them. So profitable that it allowed the money changers to take over a square mile of property still known as the City of London, which remains one of the three main financial centers in the world today.
The 50 years of war left England in financial ruin. The government officials went begging for loans from guess who, and the deal proposed resulted in a government sanctioned, privately owned central bank which could produce money from nothing, essentially legally counterfeiting a national currency for private gain. Now the politicians had a source from which to borrow all the money they wanted to borrow, and the debt created was secured against public taxes. This was much easier for politicians than publicly authorizing more tally sticks.
You would think people would have seen through this, and realized they could produce their own money and owe no interest, but instead the Bank of England has been used as a model and now nearly every nation has a Central Bank with fractional reserve banking at its core. These central banks have the power to dictate a nation’s economy and become that nation’s real governing force.
What we have here is a scam of mammoth proportions covering what is actually a hidden tax, being collected for private concerns. The country sells bonds and securities to the bank in return for money it cannot raise in taxes. The bonds are paid for with bank money produced from NOTHING. The government pays interest on the money it borrowed by borrowing more money in the same way. There is no way this debt can ever be paid, it has and will continue to increase. If the government did find a way to pay off the debt, the result would be that there would be no bonds to back the currency, so to pay the debt would be to kill the currency!
With its formation, the Bank of England soon flooded Britain with money. With no quality control and no insistence on value for money, prices doubled with money being thrown in every direction. One company was even offering to drain the Red Sea to find Egyptian gold lost when the sea closed in on their pursuit of Moses. By1698 the national debt expanded from £1,250,000 to £16,000,000 and up went the taxes the debt was secured on.
In times of economic upheaval, the deflation required to stop massive inflation, wealth is rarely destroyed but instead is merely transferred. Those who benefit the very most when money becomes scarce again are those who inflated in the first place and control the quantity of what everyone wants, the money changers. When the majority of people are suffering through economic depression, you can be sure that a minority of people are continuing to get rich.
Even today the Bank of England expresses its determination to prevent the ups and downs of booms and depressions, yet there have been nothing but ups and downs since its formation with the British pound rarely being stable. cont......(next the Rothschilds)