Thursday, January 24, 2013

The Federal Reserve Bank vs. My Shoes

When I was in college the best salesman in the world talked me into buying a pair of Allen Edmonds shoes -- specifically the chukka boots. They cost $75.

They were the best shoes I ever had. Unfortunately I didn't take particularly good care of them. I wore them every day, I once dried them on the heat register (the toes curled straight up), and I didn't moisturize them enough. Still, they lasted ten years.

They were made out of boarskin, they had cork in the insoles to conform to your feet, and they were so comfortable I used to wear them without socks.

Had I take proper care of them, and have the company rebuild them, I'd still have them (I wish I still had my '67 Pontiac Tempest slant-4).

Then I bought another pair of chukkas. By then they were up to $150. They lasted about 13 years. I still didn't take very good care of them, specifically wearing them every day, which is a big no-no for shoes.

A week for so ago I checked on the price of these boots.


I blame this almost exclusively on the Federal Reserve Bank, which is not federal, has no reserves, and is not a bank. It is in fact a legal counterfeiter which has 100% control over our money supply.

And when you have control of the money supply, you can make yourself into a billionaire, impoverish everyone else, and ultimately, destroy the country and culture.

Of course, the Fed is thoroughly unconstitutional. The Constitution forbids anything but gold or silver being money. On top of that, it also forbids Bills of Credit, i.e., paper money.

Central banks were tried in the U.S. in the past. Andrew Jackson, for one, swore eternal enmity against them.

"The bold effort the present (central) bank had made to control the government ... are but premonitions of the fate that await the American people should they be deluded into a perpetuation of this institution or the establishment of another like it," he once said. "You are a den of vipers and thieves. I intend to rout you out, and by the grace of the Eternal God, will rout you out."

Jackson engaged in a lot of duels. He once got shot, shook it off like a bee sting, plugged the guy and killed him. Perhaps we need dueling to be legal today, especially for traitors, almost all of whom are in our various governments.

Since the creation of the Fed in 1913, the dollar has lost about 99% of its value through inflation, which is nothing more than the expansion of the money and credit supply.

This inflation of money and credit means what cost one penny in 1916 costs one dollar today. In 1890, for example, one silver dime would get you a seven-course meal at a fancy hotel. Today, a quarter will get you a piece of bubble-gum out of a machine.

Perhaps without the Feds my chukka boots today would cost..maybe a couple of dollars?

This acceleration of this loss of value really took off in 1973, two years after Richard Nixon went completely off the gold standard in 1971.

Not surprisingly, wages stopped going up in 1973, and have been flat or declining ever since. Except for course, for the one percent whose income has been skyrocketing -- and they accomplished this by using the State to enrich themselves at everyone else's expense.

I've seen more than one estimate that if GDP had keep increasing at 1950's rates, the average salary today would be more than $90,000 a year.

If people truly understood what the federal government has done to them, and especially the Federal Reserve Bank, they would march on D.C. with flaming torches and pitchforks, and hang the guilty by their heels from lamp posts...just as was done to Mussolini.

Fortunately, Allen Edmonds is still an American company. And thank God for that. They haven't fled to China, where the workers make ten cents day, work 12 hour shifts, and live in cinder-block dormitories.

As an aside, one "libertarian" moron told me there was nothing wrong with Allen Edmonds moving to China to make "good, cheap shoes." "Am I missing something here?" he asked rhetorically.

"Apparently the ability to understand basic economics," I told him. For one thing, there is no such thing as Economic Man, who's run by rational economics. For an example, once you lose your reputation you can never get it back. If Allen Edmonds moved to China, their reputation and loyal customers are gone forever.

He also thought the Chinese were moving from the countryside to the city willingly. Clearly he's never heard of the Enclosure Acts in England or the Clearances in Scotland.

Let's see any economist quantify reputation.

Lots of American workers appear to make good money - in nominal wages. If the Fed had never existed, the average wage might be $10,000 a year -- and houses might cost $10,000 (my parents told me they rented a two-story farmhouse in '67 for $60 a month, and they paid $141 a month for a 30-year mortgage).

American companies wouldn't be hemorrhaging jobs to foreign companies if it wasn't for this huge disparity in wages.

More and more people are learning what the Federal Reserve Bank is. They're learning it creates money and credit out of thin air, lends it out, and charges interest. That makes money nothing more than debt. In other words, if no one borrowed, perhaps 90% of the "money" that "exists" would just evaporate.

Sooner or later, the Fed will go. The first two American central banks had 20-year charters, and then they were gone. The current one needs to go. Sooner or later, it will go.

Unfortunately, I expect pretty much a complete collapse of the economy before the Fed is eliminated.


Keoni Galt said...

Good post.

...the Federal Reserve Bank, which is not federal, has no reserves, and is not a bank. It is in fact a legal counterfeiter which has 100% control over our money supply.

Preach it!!!!

Quick correction - the Federal Reserve was formed in 1913, not 1917.

If you care to learn more about the history of infernal debt slavery cartel, check out this free, downloadable book:

Baloo said...

A good one indeed. It always helps to make the abstract concrete. I've reprinted it with thanks here:
Hard Boots and Soft Money