How Money Works (The Money Scam)
- by Wes Penre, December 11, 2004 -

How did this thing with paper money all start? Where and when did banks come into the picture?

Those are two questions not many people ask themselves, but should. The history of paper money is pretty interesting, and in a perspective it is easy to see who gains from the money system and who doesn’t. Already before I start explaining the phenomenon of money I can reveal, as you already may have suspected, that the gainer is not you!

Money is an illusion; and even more so in the electronic age. The fact is that you work your whole life for money that doesn’t actually exist. But as long as the illusion is still put there, the system works. The problem is that people like you and I are working hard, often for low pay, while the only ones that benefit are the bankers.

So how does it work? Well, if you have $1,000, you can go ahead and lend it to someone. If a bank has $1,000, it can lend up to ten times that amount and charge interest on it. This means there is only $1,000 in actual, physical money, but somehow, like magic the bank is now owed over $10,000. Where did the rest of the money come from? From an illusion that the bank created. The $9,000 plus are not covered by anything; this money doesn’t exist, and never did. So if all people and businesses in the country would take out all their money from their banks at the same time, the banks would not only end up with a zero balance, but in huge negative. They would go bankrupt in a second, because the real money in the banks is just a fraction of what the bank has in circulation, by charging interest on money that is non-existent.

When a person or a Company borrows money from a bank, the bank does not print new notes, or mint new coins. The clerk just types figures into a computer screen and the loan is set up! From that very moment, you are legally bound to repay back the bank what never existed initially. The lie is that the figures on the computer screen represent the value of gold and/or silver. If this is true, does the bank have a big stock of gold and silver somewhere that covers all the money they are lending to people? The answer is no! The paper money and the computer digits are just an illusion created by the Bankers to create money out of nothing, which makes their own wealth grow exponentially, and help them gain control over people and society, as the bankers are also borrowing money to the government and charging interest, which puts the government in debt. The extension of this is that the bankers actually control the state as long as they can keep the government in debt. Theoretically, they can tell the government to pay them back in a specific amount of time, and if the government can’t do that (because they don’t have the money to pay off the interest) the banks can give them an ultimatum that suits their purpose. Therefore, the REAL power is with the International Bankers. It is the illusion of money that rules the world.

What happens when you can’t pay back the amount of money that does not exist and never existed? Well, the bank can take legal actions and come and take your belongings until you have paid back the amount you owed (and yet never owed), including interest that was never backed up by anything real.

If a criminal falsifies bank notes and spreads them around, it is a crime, and if he is caught he will go to jail. On the other hand, this is what the banks are doing on a daily basis; in huge quantities. The criminal is creating money out of nothing and he is penalized; the bankers are creating money out of nothing and they call it banking.

The following I found on, and I found it pretty well put:

On a bank note it states “I promise to pay the bearer on demand the sum of......”. What that means is, the bank has pledged to the holder of that note, that on demand, they will give to the holder, the value stated on the note in gold or coinage. A bank note is merely an IOU.

Therefore you are perfectly entitled by law, to ask for your bank account’s total value to be paid to you in gold or coinage – it states it on all bank notes and is authorized by the Chief Cashier of each bank. So, that means that everyone is entitled to have their money given to them by their bank, in gold or coinage. The only problem is, there is nowhere near enough gold or coinage in circulation to honor these pledges, which means in effect, the paper money is worthless.

If you want some entertainment, I suggest you ask your local bank for a £10 to be paid to you in Gold. The look on the young clerk’s face will be all the entertainment you should have for one day.....

“I promise to pay the bearer on demand the sum of......”

Here’s what the Bank of England states....

Legal Tender and the Promise to Pay Legal Tender

The concept of legal tender is often misunderstood. Contrary to popular opinion, legal tender is not a means of payment that must be accepted by the parties to a transaction, but rather a legally defined means of payment that should not be refused by a creditor in satisfaction of a debt.

The current series of Bank of England notes are legal tender in England and Wales, although not in Scotland or Northern Ireland, where the only currency carrying legal tender status for unlimited amounts is the one pound and two pound coins.

Promise to pay

The “...Promise to pay the bearer the sum of ...” on Bank of England notes has nothing to do with legal tender status. The promise to pay stands good for all time and means that the Bank will pay out the face value of any genuine Bank of England note no matter how old.

The promise to pay also holds good for damaged notes, as long as enough of the note survives to prove that it was genuine and no previous claim for it has been received. The Bank’s mutilated notes department receives some 25,000 claims a year for anything from fire or water damage to notes eaten by all manner of household pets.

A Brief History of Banknotes

The first recorded use of paper money was in the 7th century in China. However, the practice did not become widespread in Europe for nearly a thousand years.

In 1694 the Bank of England was established and almost immediately started to issue notes in return for deposits. The crucial feature that made Bank of England notes a means of exchange was the promise to pay the bearer the sum of the note on demand. This meant that the note could be redeemed at the Bank for gold or coinage by anyone presenting it for payment.

These notes were handwritten on Bank paper and signed by one of the Bank’s cashiers. They were made out for the precise sum deposited in pounds, shillings and pence.

During the 18th century there was a gradual move toward fixed denomination notes which by 1745 were being part printed in denominations ranging from £20 to £1,000. In the latter half of the century gold shortages caused by war and revolution led to the production of £10, £5, £2 and £1 notes.

The first fully printed notes appeared in 1855 relieving the cashiers of the task of filling in the name of the payee and signing each note individually. The phrasing “I promise to pay the bearer on demand the sum of ...” was introduced at this time and remains to this day.

In 1833 the Bank’s notes were made legal tender for all sums above £5 in England and Wales.

Time for thought

Wake up to the illusion. And that’s all it is. This money scam has been in operation since ancient times. Just be aware of what is happening around you. Take an interest in what ‘governments’ and ‘politicians’ are up to. Don’t kill yourself for digits on a computer screen.



Last Updated: Saturday, May 14, 2005 04:28:22 AM

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