Result of monetising debt

If the American people ever allow the private banks to control the issue of currency, the banks and corporations that will grow up around them will deprive the people of their property until their children wake up homeless on the continent their fathers conquered.

Thomas Jefferson
3rd US president

From the quote above, an obvious question would be: Has the issuance of money really been privatised? Since most people believe that their government creates all the money in the economy, the idea of it being done by private organisations (for the benefit of their shareholders) seems rather preposterious. However, the "privitisation of money" is not only a reality - it is actually discussed in the mainstream media, as below.

The consequence of having privatised the issuance of our money is very dire, and it is going to cost us a great deal in the near future. This is discussed in the adjacent video.




Consequences of debt monetisation

So what are the consequences of our current system of "debt based money"? Below is a short list of the most obvious problems:

  • In order for money to exist - someone has to go into debt.
  • Our aggregated debt can NEVER be paid off - it is mathematically impossible to do so.
  • This perpetual debt is slavery, since "a borrower is a slave to a lender".
  • Banks have a profit incentive to increase the money supply, i.e. increase debt.
  • Banks cause monetary inflation - and this causes price inflation.
  • Price inflation is a tax.

The longer term consequences of having this monetary system are truely horrific, and there are already early indicators from countries like Greece and Spain. These are:

  • Austerity riots.
  • Hyperinflation - if the banks continue lending and increase the money supply.
  • Deflation - if banks stop lending and demand that debts have to be repaid (by selling assets).
  • The transfer of wealth from the middle class to the banking class.


We are completely dependent on the commercial banks. Someone has to borrow every dollar we have in circulation, cash, or credit. If the banks create ample synthetic money, we are prosperous; if not, we starve.

We are absolutely without a permanent money system. When one gets a complete grasp of the picture, the tragic absurdity of our hopeless position is almost incredible, but there it is.

Robert H. Hemphill
Credit Manager
Federal Reserve Bank of Atlanta Georgia