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Money for Nothing


And (the bank gets) your house for free



By:  David Deschesne

Editor/Publisher, Fort Fairfield Journal

July 17, 2019


   A common misconception, which has been sold to the American People, is that banks loan either their own money, or their depositors’ money. Nothing, however, could be further from the truth.

   Banks, as well as Credit Card companies (they are banks, too), don’t loan any pre-existing money at all. They loan fresh new money, just as a counterfeiter, manufacturing new money as needed.

   Banks create new money as easily as one would open a notebook full of blank paper, print numbers on those pages with a marker or pen and tear the page out. They then “loan” that notebook paper to unwitting borrowers who agree to pay that notebook paper back, with interest. Since the bank never extends any of its own money, the banker literally earns “money for nothing.”

   All borrowers today fund their own loans with their own property - their signature. Since the bank doesn’t disclose this term in the contract, the contract is fraudulently conceived.

   When you "borrow" money, you sign a promissory note that becomes a negotiable instrument at the time it is signed.1 “All instruments are like money in that they represent a right to payment and are transferred in the ordinary course of business from one party to another.”2   The bank then accepts that promissory note, a.k.a. negotiable instrument, for a certain value as an asset on their books. They then create brand new "money" in the form of a bank check/bank credits, the amount of which is governed by the Reserve Requirements established by the Federal Reserve Bank. This bank check had no actual “money” in its account before. Instead, the bank deposits the borrower’s Promissory Note as if it were money and loans it back to them. What they are doing is reaching into that figurative “notebook” and making new money to loan out. That new money is then paid back, with interest, with somebody else’s newly created and borrowed money. In any other business, this would be called a “pyramid scheme” and rightly shunned, but not with banks.

   It is because of this slight of hand, that the banks perpetrate on unwitting "borrowers," that most never realize that, since the banks never loaned any of their own money, they are never “damaged” as a result of non-payment.

   “...suppose that a bank buys part of a new issue of municipal bonds. The bank's cashier draws a check to pay for the bonds - a check addressed to himself, and calling on himself to pay money to the order of the city which sold the bonds. This check goes to increase the city's bank balance, just as much as if the bonds had been bought by a private citizen. But the check does not come out of any private balance with the bank...The check with which the bank pays for the bonds immediately becomes a deposit liability of the bank...This leaves the bank's books in perfect balance because at the same moment the bonds became an asset. An extra deposit has been ‘created.’ The same thing happens when the bank makes a loan, or buys stationary.”3

   Imagine, if you can, walking into your bank, going behind the counter, calling up your checking account in their computer and depositing new money into your account with no actual money in your hand. That is exactly what happens when a bank “loans” money. “The loan transaction does not affect the pre-existing level of demand deposits elsewhere, nor does it affect the pre-existing amount of coin and currency in circulation. Thus, since the demand deposit level at the lending bank rises, and the transaction does not otherwise affect existing components of money supply, new money is created and added to the total money supply.”4

   “Bank dealings and operations are predicated upon a basis and principle of chance, speculation, and gambling per se, from the hazards and uncertainties of which depositors must be safeguarded by double liability of stockholders and by insurance of their deposits. For every $100 cash assets banks are allowed to loan $1,000; loan $900 they do not have in the bank and draw interest on $900 they do not own, and will not be checked out at one time. This is one of the speculating and gambling operations, one of the hazards and uncertainties increasing the liability of stockholders, jeopardizing the savings deposits, and creating a doubt in the public mind.”5

   Money, as a representation of wealth, is anything that is universally recognized that will trade among people and has value - that is human labor, already added into it. When our Union was formed, gold or silver coinage was adopted in the Constitution as the only form of lawful money because it represented human labor already expended (to mine, transport, refine, and mint a coin.) Since 1933, however, our money no longer comes from the ground, but rather is literally created out of thin air as a ledger entry at a bank - the same way a counterfeiter plies his craft. This “money” has no labor added into it; rather, it has the future expenditure of labor promised against it - a far cry from the original money system of the Constitution.

   When a bank writes a “loan” to a “borrower” they are not really loaning any of their own pre-existing money. They are actually exchanging with the customer in an even exchange of credit digits for a promissory note via a process called “Ledger Entry Accounting.”

   In other words, they merely enter digits on a check that has no money in its account and proclaim there to be money. Since the bank never puts up any of its own money to fund a loan, whenever they foreclose on a person or otherwise repossess their property, they have been unjustly enriched.

   Suppose you had some Russian rubles. You can not take those rubles to a grocery store and purchase your food because it is not a recognizable form of money. You must first go to a bank and exchange them for American dollars. When you go to the bank, you set the Rubles on the counter and the clerk sets dollars on the counter. Both of you swap currencies at the value the two were determined to be to each other (less a transaction fee). There is an even exchange and the bank does not require you to pay back those dollars, because they received Rubles in exchange for them. You can then take those dollars to the grocery store and, because they are a recognizable form of money here in the United States, purchase your food.

   The same thing happens when you “borrow” money. You sign a promissory note that becomes a negotiable instrument at the time it is signed (see UCC §3-104). “All instruments are like money in that they represent a right to payment and are transferred in the ordinary course of business from one party to another." (-see Fundamentals of American Law, ©1996 NYU School of Law, p. 379).

   The bank then accepts that promissory note, a.k.a. ‘negotiable instrument,’ for a certain value as an asset on their books. They then create brand new “money” in the form of a bank check/bank credits the amount of which is governed by the Reserve Requirements established by the Federal Reserve Bank (which is owned and operated by a private consortium of banks - not our Federal government.) This bank check has no actual "money" in its account because the bank never loans its own money or its depositors.’ Under the Reserve Requirements, banks must keep 10% of their assets (on average) as cash on hand. That “cash” is the depositors’ accounts. They can then create an additional 90% above that amount in the form of ledger-entry bank credits based upon the promissory notes they accept on their books. When the “borrower” signs a promissory note, the bank enters it on their books as an asset, writes a check against it and new money is born. Because it was the borrower’s signature that gave the note value, the borrower has, in effect, funded his/her own loan - the bank extended none of its own capital in the process.

   It is because of this slight of hand, that the banks perpetrate on unwitting “borrowers,” that most never realize that, since the banks never loaned any of their own money, they are never “damaged” as a result of non-payment. Banks, upon foreclosure of property, can take $50,000 worth of property to satisfy an alleged debt of $50,000 from a "loan" of money that was never theirs and never existed to begin with. Rather, it was newly created at the time the promissory note was signed and exchanged.

   Whether a loan for a car, boat, home or land, the banks create money from nothing and upon foreclosure/repossession are allowed to steal that property because they never gave anything tangible in exchange for it to begin with.

   Police allow this legalized theft to continue because they don’t understand the nature of borrowed money and that the banks never used any of their own money to fund a “loan.”

   This bogus, fraudulent money system was endorsed by the U.S. Congress in 1913 and continues to enjoy their support, the support of police and judges to this day.

   Because all courts today are administered by a private cabal of bank-friendly lawyers and judges - the BAR Association - who make a lot of money from the banking industry, they will never rule on behalf of We the People fighting foreclosure with this defense because that would upset the current debt-driven monetary system sooner than it was designed to be upset.

   The lifestyle of the average American has increased exponentially over the past seventy years. Washing machines, automobiles, computers, internet, cell phones and the marvels of modern building techniques, modern medicine and science have all worked together to bring mankind to a level never before seen in the history of the world.

   However, that elevated lifestyle was made possible, as quickly as it came, through the mechanics of borrowed money.

   Banks create money from nothing - some say “thin air” - and loan it to unwitting borrowers. There was never any money in their vaults to begin with as they enter the borrower’s promissory note on their books as an “asset.” They then loan out a ledger-entry as if it were money, to be paid back with interest in the future with more borrowed money; functionally the same way a person pays one credit card with another.

   With the genesis of this easy money scheme starting in December, 1913 and Congress converting fully over to paper debt money in June, 1933, Americans have borrowed trillions of dollars into existence and built the most technologically superior civilization on the face of the earth. Conversely, they have also regressed to the most indebted civilization on earth since all those trillions are owed back to the banks.

   Under our current monetary system, all old loans are discharged with new loans. Banks only create (from nothing) the principle at the time of the loan, never the interest, so the interest must be paid with somebody else’s borrowed money. If interest were paid out of currently circulating currency, it would soon draw all money out of existence. Therefore, ever-increasing debt loads must be borne by subsequent generations of Americans in order to satisfy the demands of the banks’ compounding interest. Again, like paying one credit card, and its interest, with another credit card.

   Every road that has ever been built, school house constructed, home, business or church established likely came into being through a loan from a bank. While the loans for those things may have been discharged and are no longer due, they were discharged with other people’s borrowed money (see Fort Fairfield Journal, January 16, 2008, p. 3 for further description of paying debt with debt) so the loans are technically still outstanding.

   Even if a building was built using “cash,” as in Federal Reserve Notes, those notes were representative of bits and pieces of hundreds, if not thousands, of other people’s borrowed money. All of those Federal Reserve Notes represented ledger-entry money that was merely entered on a book (nowadays a computer, in digital money form) backed by someone’s promise to pay it back with somebody else’s borrowed money. The loans never completely extinguish, but are merely discharged - or rolled over onto the back of another group of borrowers.

   For example, all of the “money” in every 401K retirement account, in the stock market and in circulation is actually bits and pieces of other people’s bank loans borrowed into circulation and is all owed back to the banks from whence it came. That money is, in effect, not even yours.

   Banks also look at human life as collateral - they call it “chattels.” Since humans are able to exert energy in the form of labor, and it is that future expenditure of labor that backs up the promissory note, human life and labor is also pledged to the banks as a form of voluntary servitude in exchange for their artificially created paper money. The birth certificate serves the function of warehouse paper for governments and banks to keep track of the people with their concomitant tracking number: the Social Security Number.

   Since banks are the only entities authorized to create new paper money and loan it into existence, their “loans” must be paid back, with interest, with still more borrowed paper. Every single thing in existence in the U.S. and beyond that has been acquired with that paper was acquired with a debt instrument and is thus collectively considered collateral on the entirety of outstanding bank loan debt to U.S. society. Currently, more money is owed back to the banks than is in circulation, because of compounding interest that accrues daily against trillions of dollars worth of debt.

   Our entire lifestyle, our giant school systems, our paved roads and big screen TVs, indeed everything that makes modern society modern was all acquired by debt, which was discharged with new debt enabling banks to maintain ownership of all that collateral in perpetuity until the whole system crashes under the weight of compounding interest. Bankers look at human labor as a resource to be mined via compounding interest. Under a sort of quasi-Law of Diminishing Returns, the more money that is borrowed, the less it can obtain because the bulk of it goes to paying compounding interest. When there is not enough labor to continue paying that perpetually increasing interest, Americans will no longer be able to service the debt load with new generations of borrowers and will thus have to downsize their schools, homes, roads and their very lifestyles.

   At that point, there will be a massive recession, due to an inability of the population to pay its bills, notes, mortgages or obligations.

   A massive police state apparatus with national ID cards will be implemented in order to collect the collateral (all buildings and personal/business property) and chattels (all people) on behalf of the creditors - the banks. You can expect the Department of Homeland Security to push ID cards for everyone, and our police to enforce an increasing level of foreclosures and repossessions as the banks take back everything they ever loaned money for in order to collect the collateral. A man-made “disaster,” with FEMA and local police being used to “bring order” is quite likely the mechanism for this to occur. But, the chattels must be marked and REAL ID of the citizenry in place in order for it to run smoothly and efficiently.



1. Uniform Commercial Code §3-104

2. Fundamentals of American Law, ©1996 NYU School of Law, p. 379.

3. Money, Debt and Economic Activity, ©1948 Albert Gailord Hart (professor of Economics, Columbia University), p. 65

4. Principles of Bank Operations, ©1975 American Institute of Banking, American Bankers Association, p. 207

5. Congressman Finley Gray (Indiana) Congressional Record, U.S. House of Representatives, May 29, 1933, p. 4545


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