Chasing After Debt
Now, I know that on rare occasions I have managed to miss sighting the tree standing in the forest but, I don't think this is one of those occasions. I think Mish's apparently startled and clipped response is a product of his rote learning and let me explain why.
If I repeatedly called an apple an orange and I managed to convince others around me to call the apple an orange to the point that everyone routinely referred to the apple as an orange, would the apple be an orange? The 'obvious' answer is NO. The apple is an apple and the orange an orange, one cannot change the nature of an apple simply by changing what you call it, obvious.
As with our inability to change the nature of the apple to an orange by simply calling it an orange, calling credit 'money' does not change the true nature of credit to money. And I think this is the key to understanding Mish's response, and in the push to ban cash. People have gotten so used to referring to credit as if it were money, they actually believe that credit and money are the same thing, especially so if that credit populates their deposit accounts or comes in the form of loans or even, from the Federal Reserve. That is simply not the case because unlike money, all credit is someone else's debt, it cannot exist otherwise. For example, the credit that populates your deposit account, is the bank's debt.
To aid you in understanding my position, let me break it down to its base: Our 'money' is defined by law, specifically Section 31 U.S.C. 5103, it's a short paragraph. In it, you will not find the credit generated by the banks or the Federal Reserve listed. In point of fact, there is no law anywhere that grants to either the Federal Reserve or the banks the authority to create money, not even the Federal Reserve Act does that. That right/privilege/authority is exclusively retained by the U.S. government via the U.S. Department of the Treasury (it's a 'Sovereign Right' thing).
This means that, as of 02/2017 the actual Money Supply stands at $1.53-Trillion in circulation
Let's do a little math: $1.53-Trillion LTM in circulation (-) $1.18-Trillion LTM overseas (-) $11-Trillion in Deposit Accounts (-) $18-Trillion in Public Debt (-) $59-Trillion Total Economic Debt (-) $1,000-Trillion in Derivatives (+) $183-Billion LTM in Reserves (+) $24-Billion in FDIC (I don't know what the FDIC is holding, it could be LTM, or just their fingers crossed for luck) (=) Somebody Is Not Getting Paid. Can you guess who?
Bankster solution: Ban Cash, Ban LTM/UoA, in effect, they force the apple to be an orange. Not an unprecedented move, they've managed to get the LTM/UoA outlawed once before, when it was Gold.
What does banning LTM (cash) do for the UoA? It makes credit the de facto 'money' by which all accounts can be settled. Hooray for the banksters! They get out of their obligations to pay LTM upon demand and over time, and the account entries that were on the debit side of their ledger get moved over to the credit side. (For them, not you, you still owe, you still have to pay.) Your credited deposit accounts, which were bank debt, are 'monetized' and reserves are no longer needed, as all accounts are now fully covered with credit as the money. And all those few people with over $250,000 in deposits will be happy because their deposits will be more than just 'iffy bank debt' subject to POOF!ing out of existence the moment their bank goes insolvent. (Goodbye FDIC, your placebo services are no longer needed.)
Most people probably wouldn't even notice the change. That is, until the Fed sets the interest rates at below zero and the amount is deducted from their deposit accounts. (Gesell's demurrage comes into play.) With credit as the de facto money, and your deposit account directly affected by interest rates, with a negative rate your only options to prevent loss will be to move your credit to an investment that pays interest, spend your credit. Or, you can just sit back and watch your earnings/savings dwindle away, demurrage. Most, with investable credit, will choose to invest and those with modest or humble means, will spend. Banksters and Wall Street win again, the economy and stock markets get boosted and the banksters get more credit deposited under their "care".
So the banksters have finally reached their promised land, total control over the money supply and the economy via a system of debits/credits, that is 100% theirs. No bothersome LTM limitations, no more reserves to maintain or constrict their activities, no more threats of insolvency and, no apparent down side. Well, there is that one pesky little thing, the U.S. government's sovereign right to coin money.
Question: When is the issue of U.S. Treasury Bonds not a debt? Answer: When the bonds are used to back the medium with which they are paid......WOAH, WAIT, What????
On the Federal Reserve note the 'FRN', our 'LTM': Congress has specified that a Federal Reserve Bank must hold collateral equal in value to the FRNs that the Bank receives. This collateral is chiefly gold certificates and United States securities. This provides "backing" for the note issue. A commercial bank belonging to the Federal Reserve System can obtain FRNs from the Federal Reserve Bank in its district whenever it wishes. It must pay for them in full, dollar for dollar, by drawing down its account with its district Federal Reserve Bank. Federal Reserve notes represent a first lien on all the assets of the Federal Reserve Banks, and on the collateral specifically held against them.
The "Federal Reserve Note" designator on every Dollar is not a mark of ownership, it's a mark of Liability. What is the topic? Oh yes, Banning Fed/Bankster Liabilities.....I mean 'cash'.
Within the U.S., that equates to an $11-Trillion, measured in legal tender dollars, gift to the banks. (For the readers from other countries, just add up total deposit liabilities of your banks, and that will be your gift to your banking system when they implement a ban on cash.)
Question: When is U.S. Government not borrowing to spend? Answer: When the spending by U.S. Government automatically creates the payment.
The Banksters get their way, cash is banned, their obligations are mitigated, a system of credit/debts is locked in and the entire economic system is theirs to command and control, except they've lost one key element, government debt. You see, it's not just the banksters that get the benefit of moving their debit to the credit side of the ledger, the U.S.G. gets to do that too. With the ban on cash, the U.S.G. takes back its LTM and, it also gets all the assets held by the Fed that were used to back the LTM, as well. As for the Treasuries held by the banks, the banksters would most likely have to prove that there are no credit obligations attached to the bond at maturity in order to get a reimbursement for holding and using them as collateral backing for the credit they've created, otherwise they may be considered paid in full, or any outstanding credit attached, due and payable.
And the reason for this; it's the U.S.G.'s sovereign right to coin the money. Credit is now the money, which means that the 'money' (formerly credit) generated from U.S.G. debt is now, the payment in full. The 'money' generated by banksters using U.S. bonds to cover their obligations, is the property of the U.S.G. as well. In effect, the banksters were acting as a proxy of the U.S.G. when they used the bond to create the credit, now money. (Goodbye Federal Reserve, your services are no longer needed.)
Hooray! for the U.S.G.....
As the monetary system currently stands, it is almost entirely a credit/debit system with cash being little more than an addendum, acting as a weak restraint upon the banksters due to its status as the UoA (Unit of Account), the medium in which all credit generated by the banksters is due and assumed payable. In that regard, LTM (Legal Tender Money) represents the Sword of Damocles hanging over the bankster's head. And it is that sword they're attempting to get out from under with the banning of cash.
Note: When you use a debit card, you are using bank debt administered as a line of credit. This is because all deposit accounts are merely a record of legal claims held by depositors against the money (checkable deposits) that is supposed to be in the bank's vault. All deposit accounts are bank debt. That's why depositors are listed as the 'creditors' and the banks are listed as the 'debtors' in all deposit contracts.
When a bank generates credit as a deposit, it is creating a legal claim against itself, a legal obligation to pay the account holder in legal tender dollars upon their demand. Luckily for the banks, hardly anyone bothers to make that demand. (It's so much easier to use a debit card.)
The U.S.G. does not 'borrow' the Legal Tender Money from the Fed.
Neither the Fed or the banks can create 'Money'.
They can generate credit and use a percentage of 'Money'
as a reserve backing for deposit accounts.
That's called "Fractional Reserve Banking".
The 'Fractional Reserve System' was born in bankruptcy and it will die bankrupt.
Making It Real
Rendering total Bankster controlled, Government administered ownership
of your lives and livelihood.
Can you say, TOTALITARIANISM