>Pre-1935: Treasury sells debt directly to the Fed for free, frictionless internal accounting>Banking Act of 1935 bans this direct purchase ability completely>Force the system to use "open market operations" instead>The excuse: "Market discipline prevents hyperinflation, bro">The reality: Mandated a permanent middleman toll for Wall Street primary dealers>Now the Treasury must auction debt to private banks first, who skim the spread before the Fed buys it>Today, high debt loads turn this plumbing into an elite wealth-generation machine>Central bank hikes rates to "cool the economy">Treasury is forced to print and inject billions in interest income directly to institutional bondholders>High interest rates become a massive fiscal stimulus for the financial cartel1913 created the Fed, but 1935 rigged the plumbing so sovereign money creation always pays a tax to private dealers. Why is this ignored?
>>543543055bump
>>543543217Nobody wants to touch this one.
>>543543055>"open market operations"checked, the fedanon should be along to thoroughly explain this one
>>543544605Open market operations is the buying and selling of treasury securities on the secondary market.
>>543544942I know what it is. I referred to the fedanon on /pol/ who has far more information on it and many more related FR, currency topics
>>543544942When the Fed buys a bond from another institution, it is adding reserves to the banking system. When it sells a bond that it holds to another institution, it is draining reserves from the banking system. This is an exercise in managing the overnight interest rate (the federal funds rate, or the rate at which banks lend to each other). If reserves were to pile up within the banking system (as a result of Congress spending to a deficit, which by identity creates reserves in the banking system in the amount of that deficit) it would drive the overnight interest rate down, potentially to zero.https://www.youtube.com/watch?v=mvLmFaPvUL0
This is why there is a huge wealth gap. The fed has just been printing money and giving it to a handful of top banks for decades. And any time they go crazy like 2008, 2020, etc the fed just gives them trillions of free money as a "bailout."
>>543545534There doesn't seem to be any logical explanation for why the government would need to pay to "borrow" its own currency. After all, the only thing you can pay with is that currency! It has to exist first before anyone can buy something with it!
>>543545534The Fed is totally compromised by private banks to the point it doesn’t even fulfill its “dual mandates” anymore. They combined private banking and central banking into the most kiked system imaginable.
Didn't Reagan do similar?
>>543546674The longer the explanations go on the more confusing it becomes, which is by design, because it's a heist. So they added a ton of loop de loops to make it indecipherable to plebs. As far as I can make out, it's just the bankers giving the government money, and then the fed printing money and giving it to the bankers. So they get a ton of free money which allows them to buy up the whole economy. And that's where AIPAC money to buy elections comes from I have no doubt.
Something that also needs to be mentioned, is that this legislation (along with the Banking Act of 1933) laid the groundwork for killing postal banking in the United States.From 1911-1966 people could bank at the Post Office. Checking, savings, etc. Unlike private banks, the Post Office quite clearly could not collapse. It's ability to pay interest on savings accounts was and to guarantee the security of your deposits was absolute because it was a constitutionally-mandated arm of the sovereign currency-issuing government.By creating the FDIC in 1933 and making it permanent in 1935, the government was now guaranteeing (up to a point) deposits held within private banks. So the banking lobby argued that the government was now "unfairly" competing against the private sector by continuing to operate postal banks.Under the Banking Act of 1935, postal bank interest rates were frozen at 2%. While this rate was competitive in the Depression-era, it statutorily prevented the Postal Service to dynamically match macroeconomic shifts. So private banks gradually raised their interest rates and the post office was depleted of capital as customers were forced to transfer their money into the private banking system to take advantage of higher rates.The lobby then came back to Congress in 1966 to argue that the system was outdated and unpopular and successfully lobbied to have it shut down.
>>543548874>just the bankers giving the government moneyBut again -- the government issues the currency. Banks only have the authority to create deposits as loans because they have a charter from the government. You can't buy a bond with anything but government currency. o the currency has to exist independent of and prior to a bond sale. Operationally, the government can't borrow its own currency.
>>543549178Well you're leaving me in the dust here, but I would advise you to take me as a stand-in for the typical man on the street who obviously does not understand this system, which is obviously designed to trick the plebs. So if we are arguing in good faith about how the system works, can we agree that the reason it is the way it is is to prevent the common people from understanding?As far as I understand it, we are using "federal reserve notes." If you look on a dollar bill it says that and it says which bank it was printed by. The federal reserve prints the notes. By one method or another they end up in the 24 primary dealer banks, which then disseminate them out to other banks and customers, allowing money to flow into the economy. Then the US government wants money, so it borrows money from banks and customers. The federal reserve, through the 24 primary dealers, buys these loans so now the US government owes it instead of the original loaners. And it pays for it by printing money. So in so many words, the federal reserve is printing money and giving it to these 24 primary dealer banks, and they are either loaning it to the US government or to the rest of the world. So essentially it is a money making machine for these 24 primary dealer banks, who get infinite free money all the time and get to choose how to spend it.
>>543549532More or less, though I put the origin point at Congressional spending. But again, when the Federal Reserve was first created it could buy Treasury debt directly; what we know today as the primary market. Today for the Federal Reserve to buy a bond, it has to buy one that has already been purchased at auction.Now, the Federal Reserve if people don't know, is legally mandated to transfer all net profit back to the US Treasury. There are operational costs, and we can debate whether those are inflated, but the Fed turns the interest it earns on bonds it holds back to the Treasury. So you can see clearly that the yield or interest rate offered on bonds doesn't actually matter to the Fed at all. Hence why the lobby shut them out of purchasing government debt on the primary market.
>>543549882you ned to spend more time in the archives.lol you trying to learn things by only looking at the mainstreamspend some time with keywords in archive.4plebs and youll find your answers.
>>543543055Dude you are goyim cattle and won't do shit. Kikes could shit in your mouth right now and you wouldn't do shit, this is valid for all the goyim cattle.
