Nela Vesely on Gab: 'Who owns the dollars... and the power in the USA?

The American state has no money of its own. To buy its 'national currency', the US government issues bonds, the Federal Reserve prints the currency and lends them to the state by buying its bonds. The government then buys back its bonds, and the money with interest is paid back to the Federal Reserve. Thus, the main income of the Federal Reserve is senorage - the difference between the face value of the banknotes and the cost of making them. For example, if the cost of making a hundred-dollar note is 10 cents, then the interest on it is 99 dollars and 90 cents.

The Federal Reserve makes money not only from selling dollar banknotes to the U.S. government but also from interest payments on Treasury bonds, earnings from payment transactions, deposits and trading in stocks.

According to the Federal Reserve Act, the Federal Reserve is a government structure with private components that include: the US President's appointed Board of Governors of the Federal Reserve, the Federal Open Market Committee, 12 regional Federal Reserve Banks, private banks that receive inalienable, fixed-income shares of the Federal Reserve Banks in exchange for contributing reserve capital and a number of advisory boards. In reality, however, the state has very limited influence over the Federal Reserve for a number of reasons.

Firstly, the Federal Reserve is a state within a state and is not supervised (as, indeed, the entire banking system is).

Secondly, the managers of the Federal Reserve are appointed for a 14-year renewable term of office. As you know, the US President is elected for 4 years and the maximum term of office is 8 years. As they say, Presidents come and go, but the principals of the Federal Reserve remain. For example, Federal Reserve chief A. Greenspan held office for 19 years.

Thirdly, the Federal Reserve is the ultimate authority to determine the authenticity of dollar banknotes. This not only enables uncontrolled emission, but also allows any banknotes to be recognised as counterfeit, even if they are actually issued by the US Federal Reserve itself.

Finally, and most interestingly, the Federal Reserve forbids the government to print money and conduct its own financial policy, independent of banks. American money belongs to the privately owned Federal Reserve. That is why power is concentrated there, in Federal Reserve, not in the White House.

Epilogue: Now just imagine what the private owners of the Federal Reserve could do to us and to our country with Digital Currency.

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