This thread is the first of more to come in which I (and others if they wish) may take aim at the online video "The Money Masters" (MM). Metal Brain has claimed that it is the best video on monetary theory. I and others respond that it is a cult-video filled with conspiracy notions and plain falsehoods.
Youtube has links to the video and has broken it into parts. This thread is just a response to part 1. I will list some claims made by the video and put an approximate time of when the claim is made. After each claim I will give a response which I hope will convince readers (maybe even Metal Brain himself) that this video is factual unsound. I encourage others who wish to add criticisms to use the same format.
Metal Brain has been particularly resistant to criticism to the video. At first I was amazed by his willful disregard for education, but after watching MM I see that it is not so far from a cult. In fact, it is rooted deeply in Christian religious fundamentalism. The Bible is often used to prove an argument and many of the supposed experts are in fact religious con men.
I have chosen to limit my criticisms to factual errors. MM is filled with deceptive insinuations and appeals to authority (e.g., the Founding Fathers of the US). While I recognize that these features undermine the credibility of the video, I wish to stick just to factual errors to restrict the degree to which Metal Brain can dodge my assertions.
(1:12) "All of our money is based on government debt."
This is not true. The government does not issue debt in order to print money. It simply creates dollars. Most of those dollars go into banks and get loaned out and redeposited multiple times. This causes the money supply to expand beyond the original injection of money. MM makes the mistake of conflating money with government debt throughout its presentation.
(1:18) "We cannot extinguish government debt without extinguishing our money supply . . . Talk of paying the off the national debt without reforming our banking system is an impossibility."
This is totally wrong. The government could for instance print nearly 10 trillion new dollars and pay off the national debt entirely. Naturally this would lead to massive inflation, but it would not by necessity extinguish the money supply. No problems of impossibility here.
(1:52) "There is nothing federal about the Federal Reserve."
Ironic that he would say that in front of the building of the Board of Governors (BOG, the component and overseer of the Federal Reserve System. The directors of the BOG are appointed by the President and confirmed by the Senate. The head of the BOG must report to Congress. The BOG's main job is to represent the public's interests in the management of our currency.
(2:11) "The Federal Reserve is a private bank owned by private stock holders"
This is only partially true. Each of the Federal Reserve Banks (FRB) is owned by its member banks. The BOG (in front of which MM's host makes his claims), on the other hand, is not a private bank. It is an overseer of the FRB's and represents the public through appointments by the President of the United States.
(9:50) Barry Goldwater quoted: claims that the FR system is outside Congress control and that it has never been audited.
MM likes to throw out quotes from famous historical figures. The idea is clear. If these people were famous, they must understand the banking system and we should heed what they say. Of course, there is no logic in that. Many great historical figures were quite ignorant of economics and banking matters.
Actually Barry Goldwater (at least if his quote is not taken out of context by MM) is wrong. The Federal Reserve Chairman's appointment (as well as others at the BOG) is subject to Senate approval. This means that Congress has some (though deliberately limited) control. Furthermore the Chairman has to report to the Congress on a twice a year.
Also the Fed is audited by the Government Accounting Office (GAO). Before 1978, it was audited by other groups. I first found this at http://www.geocities.com/CapitolHill/Senate/3616/FedReserveFacts.html . This site, written by an economist at College of Charleston, responds directly to many of MM's claims. Here's a link to an auditing report by the GAO to Congress. http://www.gao.gov/archive/1996/ai96005.pdf
Even if the GAO did not audit the Fed during Barry Goldwater's time, it is ignorant, or worse, deceptive of MM to suggest that the Fed is no longer audited.
(7:47) Quote from Thomas Jefferson: "The issuing power [of currency] should be taken from the banks and restored to the people to whom it properly belongs."
MM continues, "That succinct statement of Jefferson is in fact the solution to all our economic problems today. It bears repeating . . ."
Then MM repeats the Jefferson quote. Not only is this statement wrong. While it is not clear just how MM proposes that the people should create their own money, at earlier times in American history people were able to form their own banks and write their own notes. That system did nothing to prevent deflations and inflations. Furthermore, all manner of trouble was created by these private issuers not honoring their commitment to convert notes to species (gold/silver). Moreover counterfeiting and fraud were not uncommon, and there was no guarantee that any particular notes would be accepted in different regions of the US. Without more specifics about MM's monetary plan, it is difficult to fully debunk the claim, but the suggestion that all our economic woes would be cured simply by letting people print their own money is preposterous.
Okay Metal Brain, you've begged us (and insulted us) by requesting that we show you that MM is wrong. This is a start. If you would like to continue through all 22 parts on youtube, then show some good faith and provide well-constructed rebuttals to these criticisms.
Also, at about 6'00 it states that the Federal Reserve Act was sneakily passed by just 3 senators. And that the Senate was not quorate at the time.
In FACT,
"The House passed the bill 298-60 on the evening of Dec. 22, 1913. The Senate began debate the following day at 10am, and passed it 43-25 at 2:30pm."
http://www.publiceye.org/conspire/flaherty/flaherty2.html
Originally posted by murrowAh, it appears this section has been edited out of the youtube version!
Also, at about 6'00 it states that the Federal Reserve Act was sneakily passed by just 3 senators. And that the Senate was not quorate at the time.
In FACT,
"The House passed the bill 298-60 on the evening of Dec. 22, 1913. The Senate began debate the following day at 10am, and passed it 43-25 at 2:30pm."
http://www.publiceye.org/conspire/flaherty/flaherty2.html
I was referring to a 1-minute section featuring Larry Bates - it occurs between 5'35 and 6'35 of the video on google video:
http://video.google.com/videoplay?docid=-515319560256183936
Weird 😕
Originally posted by murrowIn order for the Senate to pass something it has to have a minimum number of senators vote for it.
Also, at about 6'00 it states that the Federal Reserve Act was sneakily passed by just 3 senators. And that the Senate was not quorate at the time.
In FACT,
"The House passed the bill 298-60 on the evening of Dec. 22, 1913. The Senate began debate the following day at 10am, and passed it 43-25 at 2:30pm."
http://www.publiceye.org/conspire/flaherty/flaherty2.html
Was the minimum number back then 40? Thus making 43 the 3 senators the film refers to?
Originally posted by telerionThe movie is 3 hours long.
(1:12) "All of our money is based on government debt."
This is not true. The government does not issue debt in order to print money. It simply creates dollars. Most of those dollars go into banks and get loaned out and redeposited multiple times. This causes the money supply to expand beyond the original injection of money. MM makes the mistake of c ...[text shortened]... ome good faith and provide well-constructed rebuttals to these criticisms.
You only pointed out the first few minutes. I'd be much more interested to hear your take on the historical journey it takes us through, starting back in the 1800's.
What is your take on the First Bank and Second Bank being repealed? What is your opinion on the multitude of US Presidents like Lincoln, Washington and Jackson etc that fought tooth and nail not allow a Federal Reserve System to control the money supply?
Originally posted by uzlessAre those people prophets?
What is your opinion on the multitude of US Presidents like Lincoln, Washington and Jackson etc that fought tooth and nail not allow a Federal Reserve System to control the money supply?
Edit - BTW, again, the "yeah, what about this OTHER thing?" defense, which clearly shows any effort to explain anything to them is an exercise in futility.
I bet that any of us asked uzless or Metal Brain his opinion face-to-face they would not have changed one iota of their previous misconceptions.
Originally posted by telerionI'll start with the GAO's limited audits of the fed. Milton J. Socolar wrote a letter to Ted Stevens explaining his view on HR 2322 and contains many interesting suggestions.
(1:12) "All of our money is based on government debt."
This is not true. The government does not issue debt in order to print money. It simply creates dollars. Most of those dollars go into banks and get loaned out and redeposited multiple times. This causes the money supply to expand beyond the original injection of money. MM makes the mistake of c ...[text shortened]... ome good faith and provide well-constructed rebuttals to these criticisms.
http://www.scribd.com/doc/6320565/Federal-Reserve-Audit
Did you think Ron Paul and other congressmen are pushing this for nothing?
http://www.ronpaul.com/2009-03-25/ron-paul-audit-the-federal-reserve-2/
I will look at the other things you took issue with when I get the time. Hopefully others will contribute as well so I have time for other things.
Originally posted by uzlessA quorum is required for any action to be taken by the Senate. This requires a majority of Senators to be present, not voting for a measure. A quorum in 1913 was 49 as there were 96 Senators. 68 Senators were present for the Currency Act vote (which authorized the Fed among other things). Since the vote was 43-25, it was clearly legally passed. Moreover, 11 absent Senators wrote into the Congressional Record that they would have voted for the measure if present. So 54 Senators expressed their support for the CA; no matter when the vote was taken, it would have passed by a solid majority.
In order for the Senate to pass something it has to have a minimum number of senators vote for it.
Was the minimum number back then 40? Thus making 43 the 3 senators the film refers to?
Originally posted by telerionJefferson, though he did oppose a National Bank, never made the statement attributed to him by MM. http://wiki.monticello.org/mediawiki/index.php/Private_Banks_(Quotation)
(1:12) "All of our money is based on government debt."
This is not true. The government does not issue debt in order to print money. It simply creates dollars. Most of those dollars go into banks and get loaned out and redeposited multiple times. This causes the money supply to expand beyond the original injection of money. MM makes the mistake of c ...[text shortened]... ome good faith and provide well-constructed rebuttals to these criticisms.
Originally posted by uzlessThe fact that the movie is 3 hours long is exactly why I chose to break it up in the youtube format. It's much easier to dissect things 10 mins at a time than write 22 posts in a row about a 3 hour video. Perhaps, if we finish all 22 we can reflect on the entire video.
The movie is 3 hours long.
You only pointed out the first few minutes. I'd be much more interested to hear your take on the historical journey it takes us through, starting back in the 1800's.
What is your take on the First Bank and Second Bank being repealed? What is your opinion on the multitude of US Presidents like Lincoln, Washington and Jack ...[text shortened]... etc that fought tooth and nail not allow a Federal Reserve System to control the money supply?
Anyway this thread is about the factual correctness of MM which has been declared "the best video on [monetary economics]." It is my (and now others) response to Metal Brains claims (and yours too, really) that we couldn't come up with any solid rebuttals. In fact, I believe you asked us in the "the fed" thread for less opinion and more fact. We give you fact and you ask us for more opinion!
Even if you appreciate their telling of history, aren't you put of by the fact that they make false claim about the workings of our monetary system?
Originally posted by no1marauderNice find! I didn't think MM would be so desperate as to falsely attribute that quote to Jefferson.
Jefferson, though he did oppose a National Bank, never made the statement attributed to him by MM. http://wiki.monticello.org/mediawiki/index.php/Private_Banks_(Quotation)
Originally posted by Metal BrainYou're going to have to do better than just "read this link." Provide a summary of the arguments from the links. After all, why should we read your links when you haven't even shown us that you've read them?
I'll start with the GAO's limited audits of the fed. Milton J. Socolar wrote a letter to Ted Stevens explaining his view on HR 2322 and contains many interesting suggestions.
http://www.scribd.com/doc/6320565/Federal-Reserve-Audit
Did you think Ron Paul and other congressmen are pushing this for nothing?
http://www.ronpaul.com/2009-03-25/ron-pa ...[text shortened]... when I get the time. Hopefully others will contribute as well so I have time for other things.
Originally posted by telerionmetal brain is a loon, I think that is very clear.
This thread is the first of more to come in which I (and others if they wish) may take aim at the online video "The Money Masters" (MM). Metal Brain has claimed that it is the best video on monetary theory. I and others respond that it is a cult-video filled with conspiracy notions and plain falsehoods.
Youtube has links to the video and has broken i ...[text shortened]... ck just to factual errors to restrict the degree to which Metal Brain can dodge my assertions.