What you Don't Know about Money

Money is government issued fiat currency.

It is supposed to represent a resolution of both public and private debts.

However, since it is not redeemable for gold, silver, or anything else which actually exists, but rather for itself only - 95% of the money in circulation DOES NOT REPRESENT ANYTHING.

A mere 5% of money on the planet represents value.

Money gains its power through its consideration as legal tender by the courts. That is, the law will not enforce other forms of debt resolution, if money has been offered.

By removing currency from a gold standard format, money has now become the representation of debt, and thereby synonymous with debt. Money is debt and debt is money.

Money therefore only represents money other people owe banks or the government because they are the only ones who can issue debt.

And, since governments and banks are the sole lenders, they therefore are the sole producers of money.

People are used to hearing about the government printing money, but the banks in practice do the same thing millions of times every day.

Moreover, how much money (debt) can be issued, that is, if it is entirely in the hands of the government and banks to do so?

Well, if there is nothing tangible, like the amount of gold it has to be based on, even loosely - what could the limits be?

Furthermore, the amount of money in the world is never the same at any given moment because if money is debt, then every time someone takes out a loan or opens up a credit card account, creating debt, more money is generated - yes from nothing.

There are thus no limits to the amount of money that can be issued.

As a result, the calculable number of money in existence is in constant flux, always on the rise whether lending occurs or loans are defaulted (except when no lending occurs across the board. But, this has never happened because central government banks are always lending, even when banks are hard-pressed).

This places the world economy is an incredibly unstable position.

For, this means that 95% of the loans which are issued by banks are based solely on promises of other borrowers to pay back their loans - and it is THIS promise that the entire world economy depends on for its survival.

The wormhole continues.

An important result of this is that when people are asking for loans, and banks are lending them, a lot of money is being created (albeit out of thin air). More money grows the economy and when the economy grows people's quality of life improves.

In this scenario, the modern day money system seems quite brilliant. We are simply growing prosperous out of our own will to become prosperous!

However, there are three fundamental flaws in an economy where money is debt and debt, money.

For our modern-day economy to exist people cannot pay off all their debts.

This is because the debt is used as leverage to produce loans and credits that are the core source of money. If no one had debt, the economy would shrink to only 5% of its current size (remember that 95% of all current money represents debt). Without debt - there would be virtually no money.

However counterintuitive this may be, because shedding debt is good for personal finances - this is not the case for the economy as a whole.

The second flaw is people cannot pay off zero of their debt either.

If everyone defaulted on their loans, banks would replace borrower's debt with lender's debt. It is not sustainable for money to be manufactured by the bank on the basis of money the bank owes itself. It cannot be leveraged to create loans. Banks wouldn't be able to lend and the government could only last so long on its own. New money would effectively disappear (though the demand for it certainly would not).

The final flaw is our economy cannot sustain itself unless people are lending and consuming debt, perpetually and at an ever-increasing rate - and sometimes this just doesn't happen.

People deposit their money in the bank under the belief that it will be safe at all times. But, if other people who the bank is lending to cannot pay back their loans, this threatens the the banks liquidity, or cash reserves, which although the federal government covers up to $250,000 of deposits, can eventually leave banks unable to lend without risking their very existence and directly impeding economic growth.

Now, it is inevitable that at some time large numbers of people will both default on loans and yank their money from the bank.

This leaves banks with little to no issuable debt, and because debt is money, little to no money.

When vast sums of money vanish in a matter of days banks cannot lend and the economy is left in tatters.

Ergo, it seems, to have a profitable economy a magic balance must be stuck between some debt being paid, some debt not being paid, and there being an extraordinary faith that consumers can cover and bankers can issue more debt than the day before, and way more debt than could ever be paid off at once, everyday.

To add salt to the wound, it is worth noting that most debt carries with it interest as well as the principal balance.

Since the amount of money in existence is only based on the principal, new debt must be manufactured to pay for the interest off the old debt.

This has to occur because without interest, banks could not cover operating costs, and could not lend.

So debt is created to pay for debt. And because that debt ALSO carries with it interest, the cycle never ends. It is incessant.

Our position is thus an ever precarious one: Debt or Poverty.

Or, in the words of the Credit Manager of the Federal Reserve Bank of Atlanta Georgia:

This is a staggering thought.

We are completely dependent on the Commercial Banks. Someone has to borrow every dollar 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.
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For more watch this: What Money Is.

Dream for Computers to Process at the Speed of Light Renewed by Brazilian Beetle

"Researchers have been unable to build an ideal 'photonic crystal' to manipulate visible light, impeding the dream of ultrafast optical computers. But now, University of Utah chemists have discovered that nature already has designed photonic crystals with the ideal, diamond-like structure: They are found in the shimmering, iridescent green scales of a beetle from Brazil.

'It appears that a simple creature like a beetle provides us with one of the technologically most sought-after structures for the next generation of computing,' says study leader Michael Bartl, an assistant professor of chemistry and adjunct assistant professor of physics at the University of Utah. 'Nature has simple ways of making structures and materials that are still unobtainable with our million-dollar instruments and engineering strategies.'

Researchers are seeking photonic crystals as they aim to develop optical computers that run on light (photons) instead of electricity (electrons). Right now, light in near-infrared and visible wavelengths can carry data and communications through fiberoptic cables, but the data must be converted from light back to electricity before being processed in a computer.

The goal -- still years away -- is an ultrahigh-speed computer with optical integrated circuits or chips that run on light instead of electricity.

'You would be able to solve certain problems that we are not able to solve now,' Bartl says. 'For certain problems, an optical computer could do in seconds what regular computers need years for.'"1
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When computers gain the ability to process data at 186,00 miles per second, the question then becomes:

Will we have reached the roof of the speed at which anything can travel, atom or AVI?

Or, will we manifest a schema for breaking Einstein's cosmic constant, the speed of light, bringing humanity to a level of interaction beyond the known laws of today's physics?

1Diamond-Like Crystals Discovered In Brazilian Beetle Solve Issue For Future Optical Computers

What Happen's When a Crocodile, Herd of African Buffalo, and 6 Lions Tussle?

Battle at Kruger is one of the most popular videos on Youtube, with 31,750,375 views to date, but if you have not seen it, it is most certainly worth your eight minutes. Such extraordinary interspecies battles are seen, if one is lucky, once in a lifetime. Enjoy.

You Think it is Bad Now...

The New York Times reports that "Oil prices have nearly doubled in a year," and furthermore, "As demand continues to outpace the growth in oil supplies, analysts expect little relief in prices. A shortfall in supplies over the next two years will probably send oil to $150 to $200 a barrel, Goldman Sachs said in a new report.

Analysts’ forecasts for the price of gasoline over the next few years run as high as $7 a gallon."

This sounds pretty ominous. I am praying that they are overestimating. But, I know in my heart analysts, economists, and reporters typically underestimate these numbers. One can only hope that this time we experience the exception rather than the rule.

However, evidence for such positivity is scarce. For according to the above quoted NY Times article published just six days ago, "the government said it expected gasoline prices to peak at a national average of $3.73 a gallon in June, just as the summer driving season kicks off." And yet, we're barely half way through May and we've already hit that mark.

The Times also reports that "Some private analysts have gone beyond the Energy Department’s forecasts, predicting that gasoline will surpass $4 a gallon this summer." But at the rate we're currently going, I think we're primed to be there before summer even begins (June 21st)!

I think I have chosen the most expensive summer to travel across America...smart.

Read the NY Times article

See the AAA's national gas estimates

McDonalds hamburger & fries virtually unchanged since they were served 4 years ago!

Wow this is grotesque. I may never have fast food again...or at least for a very very very long time.

Is there TOO Much Freedom of the Press?

"In a 'State of the First Amendment Survey' conducted by the University of Connecticut in 2003, 34 percent of [high school-age] Americans polled said the First Amendment 'goes too far'; 46 percent said there was too much freedom of the press; 28 percent felt that newspapers should not be able to publish articles without prior approval of the government; 31 percent wanted public protest of a war to be outlawed during that war; and 50 percent thought the government should have the right to infringe on the religious freedom of 'certain religious groups' in the name of the war on terror."

This is pretty horrifying.

Have teenagers missed the unequivocal point that without freedom of speech and press there is no freedom at all. For I know teenagers of all people value independence and liberty...I mean isn't that what those hectic years are all about, liberating oneself from one's parents?

So why this disconnect?

Exactly what America have these teens grown up in that could allow for this myopic and inane comprehension of the relationship between freedom, human rights, and communication on such a massive scale to exist, and, persist?

Is this a sign of a tired, weak, mindless parental populace drifting to institutions like the government to tell them and their children what to know, say, and do, so they don't have to breech the perceived security of their ignorance and think for themselves?

Whatever it is, if there is any war worth fighting, it is the battle to preserve/augment the quality of the minds of a future America against fecklessness, dogma, idiocy and indolence.

What kind of parent are you, or are you going to be? Don't become one of these. Don't become yet another member of humanity that slows down the healthy evolution of our species because you're too scared to push the static boundaries of your psychic comfort for truth and intelligence.

(Incidentally, if you are a parent and this is the first time you have really thought about this, it may already be too late for you.)

Read the rest of Gore Vidal's article in the Huffington Post: President Jonah
More on the survey itself: http://www.msnbc.msn.com/id/6888837/