The unreality of finances in the Federal Reserve

The unreality of Federal Reserve finances blows smoke screens throughout the world on a daily basis, affecting the lives of people throughout the world, particularly the low-and-middle class citizens of the United States. That is because an average person buys groceries and pays bills with money, while the Federal Reserve manipulates with currency.

Huffington Post reports that "Between 1979 and 2005, the mean after-tax income for the top 1% increased by 176%, compared to an increase of 69% for the top quintile overall, 20% for the fourth quintile, 21% for the middle quintile, 17% for the second quintile and 6% for the bottom quintile..." Yet the Republican budget proposal is to to trim $60 billion from the fiscal budget ... putting thousands of lower class people out of work and with a massive cut in services provided to them. "Well then", says Boehner, “so be it," forgetting that the Republican promise to get into office was to increase jobs for mainstream America.

This huge gap explains why the March 4, 2011 article in the New York Times by Floyd Norris, “The Chasm Between Consumers and the Fed,” can successfully discuss with meaning how the American people and the Feds are on different planets, while putting the low and middle class people as the sole support of the United States and the main focus of budget cuts and job loss.

“Are the Fed and the public on different planets?” Dennis Lockhart, the president of the Federal Reserve Bank of Atlanta, asked in a speech last month. “There seems to be a disconnect between what the Fed is saying and what people are experiencing when they fill up their gas tanks or read about rising food prices around the world.”

Mainstream America is struggling to pay rising gas prices, medical issues, clothing prices and rapidly increasing food prices that places them out of reach for those who have lost jobs, homes and savings. Yet the Federal Reserve is quoted by Norris in his article, “Inflation in the United States is low, and seems to be going down if it is moving at all. The Federal Reserve thinks it will be years before there is any significant inflation.” You think? Ben Bernanke testified in Congress there is a “relatively modest increase U.S. consumer price inflation.” According to the Feds, the increase has never been lower since 1959.

The unreality of this to the American people is because money is imaginary and currency only represents money, with the Federal Reserve in full control of its creation. If the economy becomes short on currency, it is short of money. Yet this same man in the article, “Don’t blame Federal Reserve for record-high food prices” discusses the UN’s Food Price Index at its highest in 21 years and gas which has risen 49% in six months. The government wants flexibility? It cannot get any more flexible than the through Federal Reserve. CS Monitor reports that “world food prices notched a new high in February [2011], adding to concerns that global inflation may be on the rise.”

According to a report by the University of North Carolina, who is in control of all money for the American citizens are the super wealthy and the Federal Reserve. In 1895, “the Supreme Court declared a National Income Tax to be unconstitutional, refusing to tax the wealthy but the poor. By 1913, the Federal Reserve was created. It is a privately owned organization within the United States, but today is run by about 50% of overseas banks.

In the United States, it controls interest rates, inflation and could lend money to the United States, which was returned through income tax --- all by the low and middle class population. The University paper quoted President Woodrow Wilson, “I am a most unhappy man. I have unwittingly ruined my country ….the growth of the nation, therefore, and all our activities are in the hands of a few men. No longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of a small group of dominant men.” (The New Freedom)

Money can be held in your hand, but its value can be changed at whim by those who control it. The only time money and its value becomes real is when it is connected to labor and services. For example, the number 100 is worthless by itself. It could mean anything and be changed any time. But once attached to $100 dollars’ worth of labor or $100 dollars’ worth of groceries, it becomes meaningful and worth achieving. Therefore, it is best described as an imaginary concept that has little to do with the needs of the low and middle incomes of America, but more to do with lining the pockets of the super wealthy who are in full control of America’s politics and finances – making the unreality of Federal Reserve money even more unreal to the average person.