What is The Federal Reserve Bank and Why Do They Cause Debt?

The Federal Reserve
The Federal Reserve

How Printing Money Isn't Good For The Economy

A central bank is one that prints currency for a country. Almost every country in the world uses a central bank even The United States. The United States had a few central banks throughout its history. The first two central banks of the United States had failed and were very quickly forgotten. The third central bank is still in existence today. We know it as The Federal Reserve.

The Federal Reserve is a private bank that was created in 1913. The Federal Reserve prints money for the United States government and charges interest on every dollar printed. So as soon as a dollar is printed automatically there is a debt attached to that dollar. Also for every dollar The Federal Reserve prints the value goes down and prices go up. So the people who use the money aren't able to buy as much with it because when The Federal Reserve prints more it loses value. I'm sure your asking well they probably don't print money all the time right? Wrong. The Federal Reserve increases the money supply 2% per year, so every year you lose 2% of your money. Also there is information that the money supply more recently has been increased a lot more than 2%. The Federal Reserve has been bailing out a lot of people. They do this by printing trillions of dollars and handing it out to their friends. It is very unfortunate we use a system of this nature.

Lets take a look at the Constitution. The United States Constitution says ONLY gold and silver may be legal tender. Before 1933 our money used to be backed by gold, meaning you could take a dollar to the bank and trade it for a dollar of gold. Well the government ended up printing more dollar then they had gold and the gold was becoming more valuable than the dollars. The government decided to make owning gold illegal and confiscated the gold. They did this so they could unlink the gold to the dollar and print endless amounts of money.

If you are interested in more information these are great sources

The Federal Reserve Banking System

Gold is the most honest money. When use gold as a currency and not abuse the power of printing more money than gold it will bring great prosperity. Gold is valuable and it keeps prices stable. The United States doesn't use gold anymore though and our dollar is not backed by anything, it is just paper.

I believe that if we don't stop The Federal Reserve from ruining our currency it will soon be worth nothing and our country will collapse. The people who control the money supply also benefit from inside information and are able to make profits off of it.

This is where the transfer of wealth comes from. When The Federal Reserve prints money the value goes down and prices go up. Which means middle income families are paying more to survive but the corporations still make the same amount of profits. If we use The Federal Reserve system you are going to see much of the corruption around us today along with almost every problem we face as a nation. They perpetuate the government to spend money because people think that The Federal Reserve will always be there to print the money if the government taxes or borrows too much.

The Federal Reserve is a pyramid scheme and should be stopped. If you would like to help spread this message or vote for Ron Paul in 2012.

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Comments 1 comment

Michele Travis profile image

Michele Travis 4 years ago from U.S.A. Ohio

This is an excellent hub. The Federal Reserve is terrible. There is even going to be a grass roots movie about the Federal Reserve. Here is a link to it.


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