Credit Leverage got us into the Mess

Credit Leverage got us into the Mess and governments will have to use the same principal with the money it doles out to corporations and the public in general.They will need to have the private sector and public match several dollars for ever dollar of government subsidy. I mean to get the money flowing again which is what this crisis is, just us not spending "in case we need it for a really rainy day". The money flow is what creates prosperity otherwise you can just think of all currencies as monopoly money, it has no value if it is tied up doing nothing . If it is locked up not flowing it decreases the value of everything that's deflation. The problem is we wait for the other guy to start spending ,not realising we are the other guy. The thing is if the government sends you some money don't use it to reduce bills, debt or waste it on beer but think what you could spend it on in your local community that will stay in your community.Maybe you need to get your roof fixed or a solar water heater or something else that will save you money in the long run. Also think of the fuel miles a product has to use to get to you .

Understanding Money and Taxes

This is reproduced with permission from Leonard Orr from "The Truth About Money". The reason i am reproducing it is that i think it is a big part of the solution and i am using "The Hundred Monkey" principle by Ken Keys To expounded it .Which by the way if you take the K out of monkey is money so this may be dyslexic but there must be some correlation between the two .I feel the same things below applies to Australia as the USA.

You will be amazed how simple money really is! Here are the secrets to money - both personal riches as well as public and government finances - in a very brief form. Now we will be able to pay the national debt just by copying and sharing this essay, if we share it with enough people. Good news for all my fellow citizens.


First, money is a means of exchange. Exchanging what? Wealth. Wealth is ideas, goods, and services. Money is not wealth, but a means of exchanging and measuring wealth. Money is ones, zeros, and paper (or now computer chips).

Second, money is a merry-go-round. All the money you don’t have, other people have. You and I get our money by supplying other people with ideas, goods, and services. We can easily double our income by serving more people. Personal creativity applied to the loves and goals of other people is the source of our loving service that leads to riches. We can have fun winning the money game by supplying our own loves and pleasures in life to others who share our tastes.

Third, now for a revolutionary lesson in macroeconomics that will get you excited! I mean really excited! We have the power to print money! Money is a means by which buyers and sellers (also called producers of wealth and consumers of wealth) exchange their ideas, goods, and services. In simple terms, economies are composed of laborers and consumers, who are obviously the same people trading with each other.

Money simplifies barter between farmers and computer programmers. Money increases the freedom of choice as actors and artists trade their abilities in the local marketplace. Money also increases the efficiency of their bartering, as it does for all of us. Now for the exciting part!
This means that the actual source of money are the buyers and sellers - citizens - us. We are the natural source of the money system. We have the natural right to create any kind of a money system that serves us in exchanging our wealth. Money is a creative and wonderful invention. It is the servant of people, not the master. In other words, we have the natural right to print money.

Now, this will amaze you. You and I also have the legal right to print money. Yes, we do! We do not have the right to print Federal Reserve notes. Federal Reserve Bank Notes belong to the bankers. This is forgery - but we do have the legal right to print money. We exercise this right every time we order personal checks at a bank. Every time we use a credit card, we are printing money out of nothing at our local store. You and your local merchant are printing new money to assist you in your transactions of exchanging ideas, goods, and services.

Coining or printing money is an inalienable right of the people. To further understand this simple and obvious fact, consider the example of American Express. The founder of American Express discovered that he had the legal right to print United States dollars, but not Federal Reserve notes. He printed American Express Traveler’s checks and sold them at a profit.

Bank of America followed with Bank of America checks and many other individuals, institutions, and banks got into the money printing business by selling dollars at a profit. When I understood this, I also started a new money system and printed money. It is not as successful as American express - yet. I believe it was American Express who created the first credit card.

Understanding money and the money system is big business, and now, I’m going to show you how to cash in on it.

As a citizen of your country, you can own the money system. Money is a social experience of communication and agreement. The value of money is determined by the buyer and seller in every transaction. All transactions are negotiable and optional. Everything can be purchased without money if we have enough creativity and salesmanship or something to trade. Profit is the creation of new money out of nothing but the imagination of the individual business person. It is put in the bank when someone pays the profit. When a business person buys a piece of furniture, for example, and doubles the price, he or she is creating a profit or new money for themselves out of nothing. All profit is a way of printing money out of nothing. When a doctor, lawyer, or breath worker sets a fee for their service, they are creating money out of nothing. The value of our time and service is created out of our imagination and communicated to our clients by agreement.
Taxes mean we produce to earn money to give to the government to buy what we produce - it is double work - it is a great injustice and ignorance. We the voters can just authorize each government to print the money for our community project needs. Our local and national governments have the right to print money for their budgets. Taxes are optional, unnecessary, and obsolete. The bankers figured this out and took advantage of it.
The bankers took advantage of the ignorance of the people by stealing the US money system from us. As a result, the US money system is the most corrupt in the world. It is time for the people to rediscover ownership of money. We have the legal power to print money. The bankers print Federal Reserve Notes out of nothing and loan their money into circulation and charge us interest. It is only our ignorance and apathy that keeps us from doing it ourselves.

Before the invention of money, kings had to tax farmers to feed their armies and workers. When money was invented, taxes became obsolete. Kings could then print money and buy food for their soldiers and workers. They also could give an equal supply of money to every citizen to make the money system work in a rational and effective way.

Government Without Taxes

The average United States citizen pays over 53% of his/her personal income in taxes. Yes! Over 50% of your income goes to the government: income taxes, property taxes, sales taxes, gasoline taxes, etc, etc.

Does this tell you why everyone is in recession or in financial insecurity? The government, like a giant dinosaur, is eating our farmers, our business people, consumers, etc. Government taxes suppress the poor, private enterprise, the arts, support for the environment - the list goes on and on.

Fortunately, we learned in school that we own the government. So why are we doing this to ourselves? Ignorance. We are ignorant about money and about our citizenship. But no more, not after you finish this essay. You are now getting yourself enlightened and armed with the truth!
The Federal Reserve Bank is a private corporation established in 1913, and very, very rich people who own it are collecting the interest on the national debt as well as on all the money circulating in our economy. Your ignorance is worth billions of dollars every year to them. These billions are coming out of your pocket. Are you going to stay ignorant?

The bankers theft of the money system in 1913 is dependent upon your ignorance. These private bankers print all the money and loan it to us at interest, called the Prime Rate. We pay them interest on our credit cards and real estate loans, etc. We are slaves, all our work pays them.
But if you claim your natural and legal power now, you can instantly double your spendable income as soon as you eliminate taxes. As the source of money with the power to print money, we the people have the authority to authorize our governments to put a credit in its checking account for its annual budget. When we use our natural right as a citizen to create a money system that serves us, taxes are unnecessary. We can authorize our government to print the money for the budget; then we must supply the ideas, goods, and services which we authorize the government to buy. The government can only buy from the people what we produce. The United States Constitution gets its power and authority from us - we the people! We, the citizens, are the sovereign rulers of our governments and our money system. We are the owners of governments and our money system.
For example:

Your city government has the right to form its own bank and put a credit in its own account equal to the annual budget – in other words, to create the money by the vote of the people. Taxes are not necessary. Taxes are an obsolete holdover from feudal society. Taxes are the result of ignorance about money. Before money was invented, the king had to tax the farmers to get food for his army. But when money was invented, the king could print money and buy food from the farmers. Taxes have been obsolete since money was invented, but we the citizens have been too ignorant to notice the Truth about money.
George Washington did this. He printed enough money to finance the Revolutionary War. After the war, however, Washington’s money system failed because he didn’t understand money enough to give all citizens a regular supply. He only printed money for government expenses, so only people who did business with the government got money. All other business people rebelled by raising prices to get some of this money. The rebellion didn’t cause Washington to distribute money in a fair and equal way so his money system failed. When they started printing money again, it was based upon gold as a standard. It made everyone equally poor, but since it was equal poverty, this move stopped the rebellion.
One of the eternal principles of a rational money system is that everyone deserves an equal supply each time it is printed. We can also print extra money for community projects which we all agree upon.

Your state government has the right to print money, just like the Federal Reserve Bank and American Express (which are both private corporations). If private corporations have the right to print money, so do public governments.
The county Board of Supervisors has the natural, moral, and legal right to print money for its budget. We, the voters, own the money system.
The United States Congress has the constitutional right to coin enough money to pay the national debt. All governments have the natural and legal right to print money. Citizens and congress people are just ignorant about money.
Now, consider this concept. You, as a citizen, deserve a monthly dividend check based upon the social and financial prosperity of your local economy as well as the gross national product of the United States economy.

Think of that! You deserve a percentage of global prosperity as well as the cash flow of every business. You deserve to prosper as a laborer or as a consumer. You deserve to be a shareholder in your economy and receive a monthly dividend check based on the ideas, goods, and services produced and consumed. Poor people deserve to be financially independent as much as the rich. As a natural divine human being, a child of God, you deserve a percentage on every commercial exchange of wealth on the Planet. All natural resources are a part of our net worth at birth and we deserve royalties on them. Individual citizens should receive taxes from the government not pay taxes to the government. A percentage of every government budget has to be distributed to every citizen equally in order to maintain our present levels of prosperity.

A rational money system works best when consumers receive a regular supply of cash. This is the way the money system works for the rich and intelligent citizens who have regular income from investments and it can be the same way for us. As a consuming human being, you deserve a regular cash flow based upon the total production of ideas, goods, and services in your economy. Multi level marketing companies practice this principle for consumers; the New York stock exchange practices it for investors; profit sharing companies practice it with employees; banks practice it with savers.

We citizens deserve an equal supply of money, monthly, based upon the total amount in circulation. The amount of money in circulation should be adequate to support our production of wealth and our consumption of what is being produced for us. If we don’t buy or can’t buy what is being produced because of money scarcity, production stops. It is ok for production to stop when everyone has enough, not because of money scarcity. Money scarcity is foolishness on our part or just bankers’ greed – if they are controlling the money system. The most popular alternative currency is called Liberty Dollars. It is backed by gold and silver and is inflation-proof. You may like to study the excellent information on their website.

Some Congress people are now trying to take the power – our power – to print money back from the bankers and give it to the U.S. Treasury, but it is doubtful they will succeed as long as the bankers can buy U.S Senators or Presidents who will block this move. We voters also have to cure our ignorance and apathy on this issue by participating in local money systems. When we join a local money system, we are learning the truth about money by playing with it. We are learning by doing – the most valuable way to learn.

In the meantime, as Congress battles about this problem, we can solve it in each community by creating a complimentary local or national money system.

Paying the National Debt

The bankers create money out of nothing and loan it to our U.S. government and charge interest. This procedure was created in 1913 to make the bankers insanely rich. Scholars tell us that the bankers had it passed during Christmas recess when they could manipulate the situation by having enough loyal congress people attend the Congressional meetings to get the Federal Reserve Bank Act passed when their opposition was not present.

Then, they created the I.R.S. as their own, private collection agency to collect taxes from Federal government employees only to pay the interest on the national debt. The I.R.S. has been a private collection agency for the bankers for most of its history. Its purpose has never been to raise money for the U.S. government, but to take money from American taxpayers. This is still the basic purpose of the I.RS.

Since the national debt is created out of nothing, the bankers never desire to have it repaid, but to make it bigger and bigger which they try to do every year so they can get more of our money as interest.

But since this money is created out of money and loaned to us, by law, it returns to nothing when it is repaid. This means that Congress does not have to repay this money by collecting taxes from us poor and stupid citizens to repay the principal, but just vote it out of existence. The national debt is created out of nothing but ignorance. It is a legal fiction. Congress and us are stupid to believe in it.

The Congress that gives the bankers the right to print money out of nothing can use this right itself. All intelligent citizens who have half of a brain to think about it can figure this out. Most citizens don’t think about it. And most Congress people don’t either.

Congress gets the right to print money from us. We, the citizens – the buyers and sellers – have the right to print money within ourselves. The traders of ideas, goods, and services, are the source of money. The workers and consumers are the value of money. Without us, money is worthless paper. It is time for us to realize the truth about money and to build and support alternative money systems.

The same things apply To Australia as above

Look for an increase in Volume to see the End It's just beer money for the wealthy

The end of a bear market in the share market will be accompanied by huge volume increases of 4 to ten times the daily average without increases in price. This is when the desperation has set in and people finally cutting their loss's to take advantage of tax right offs. This is when the smart money comes in to buy stocks that will survive the financial mess.

The really old smart money only ever buys bargains basement prices ,as a old Jewish friend of mine once told me " he never pays retail".
The best way to pick a winner is by the old Warren Buffet method of looking in your fridge or to put it another way. What do you spend money on and use, that you will have to keep using even if times get tough.
Food ,clothing and shelter are the staples. Electricity, transport to keep a job, but we will cut back on the excess's we don't rely on .
Now banks on the other hand you can never really see what they produce and if we could live without them we would or move to a safer haven such as a credit society that has no share holders to force it to take uncomfortable risks for ever higher returns. Credit societies don't have to worry about share prices to raise capital ,they just quietly grow organically on disgruntled exbank clients.
There is a system of investing to make yourself cost efficient .That is if you electricity bill is x dollars a year you buy enough shares in your utility that pay a dividend to cover your expense and so on with your phone bill and food etc. Start with the necessities while share prices are low and eventually you will never have to reach into your own pocket again.
This is much smarter than leaving it up to some wizz kid in a super company that you have no control over. As Warren said why would you take advice from someone that takes a train to work if you drive an expensive car yourself. If you buy beer, buy the shares as i am sure you will keep buying beer when times get tough to drown your sorrows. Beer sales actually increase in hard times.

Negative Gearing on existing Assets caused the Housing and stockmarket bubbles in Australia

This archaic rusty old tax system only encourages the over valuation of existing assets as the return is almost instant. Why reward investors for being lazy and getting instant gratification, we need the reward to be paid to the the investors that take the real risks and build new properties and business's. It is just an easy way for the wealthy to avoid paying taxes and increasing their capital without really contributing to the Gross domestic product of our Australian economy. We could possibly have not had the stock market collapse because there would not have been so many margin calls on stock bought with borrowed money. We could phase out the negative gearing over a 10 year period on old assets and only apply it to new endeavors from the up coming year. This would also help house affordability and young family's might be able to afford to buy in the areas they grow up in and feel comfortable with. As there would be fewer investors buying property for rental purposes in existing suburbs this would also improve the quality of life for people living in establish suburbs

Cap and Trade fiasco

Why give the same traders that have given us sub prime securities and other dubious instruments to ruin our financial systems a new tool for destruction. The cap and trade will end up in the same mess, Australia is too small a player to influence the world carbon sequestration . What we need to do is much more simple ,that is reward those that reduce carbon with tax credits and tax those that that pollute both here and abroad with a carbon tax on their products. In the end everything comes down to the economics of a profitable energy system . By having a cap and trade system we will only make countries that don't pay a penalty more competitive with our producers. Exporters should be exempt from these penalties as it is up to the counties receiving our products to place their carbon taxes on our products. Get rid of import duties and replace it with carbon taxes. Having a cap and trade is only going to sustain the polluters that much longer. Copies to Penny Wong, Minister for The up coming Enron carbon trading system. By the way if anyone thinks it will effect global free trade it will but that term only means the USA getting stuff for free and us paying more. While i am at it if the Reserve bank would stop propping up the Australia dollar our manufacturing industries might be able to compete with Asia . We might also become the tourist destination of choice, i mean it is quite obvious the reserve bank has no idea what it is doing as it was putting up interest rates when it should have let it run it's course as i said earlier in the year.

Patently Protect our Investment

If the federal government in Australia is going to give incentives to the Auto industry and others with grants of taxpayers money . Then we the tax payer need to have some ownership of the patents so we get the ongoing benefit. With all this money to go into innovation there is bound to be many patents and products developed that can then just be handed over to parent companies for little cost, or worse still no cost. Many inventions of Australia have been bought up by foreign investors then taken off shore after huge state and federal funding grants has been poured into their development . Usually just when the product is at the production stage and all the research and develop has been paid for by us the taxpayer. The stake holders such as suppliers ,employees , and initial investors are generally left with nothing. Even if the government never gets paid for the patent ownership it will still retain the ability to stop the ideas being nefariously transferred to huge multinationals with their own agendas .

Bring Back National Service

During the period around the Vietnam War the drinking age was lowered from 21 to 18 and national services was dropped thereafter.
As a direct result of this a vast number of undisciplined individuals are now binge drinking,driving dangerously causing death,indulging in hoon behavior and becoming recalcitrant long-term unemployed. I am now so desensitized to these people on current affairs programs i could easily over react to them if i came across one.
Instead of allowing these people to get off with little regard to the consequences of their actions. We as society need to teach them discipline in the form of a Nationalised basic training of between 6 months and 2 years service including ,physical, ethical, moral training and environmental responsibility .
I work in a service industry and parents tell me that their kids are well behaved. well, i can tell you that is true only when they are in sight .
These parents suffer from the kings new clothes syndrome and never had the training to properly engage their offspring in responsible manners and ethics,which the religious bodies used to endow.
Most of these people are basically good human beings but have not had a good moral compass set for them.
As a society we need to act, not to impose penalties but to imbue a sense of common community, which is what national service is.
The forces provide many community benefits including engineering projects in isolated communities and we need to strengthen them by automatically inducting these offenders who have strayed.
Perhaps then we can live our lives in a civilized community free from intrusion on our rights to go about our lawful business.
When i visited Singapore last year i meet several local young people whom were law abiding citizens that told me the would comply with any demands from authority to get out of their 1 year compulsory national service .
Now i am not saying we should apply this to everyone but anyone between 15 and 60 years old that thinks they are out side of public decency or above society standards of contributing gainfully.
We as a society changed the drinking age and compulsory national services expecting a responsible response and they have not lived up to their end of the deal. Several night clubs in Australia have recognized that 18 to 25 year old are no mature enough to handle drink and made themselves exclusively over 25 year old venues. we as a nation need to recognize it as well.
We now as the feed up give fair warning that this can be changed back . Also we should seriously consider bringing back Drunk and Disorderly charges then enforce them with zero tolerance.
These measures will single handedly increase national productivity which will stave off a recession.
A national tree planting force could also use these people for environmental establishment of carbon sinks and revegatation in areas with high salinity.