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Hank Sullivan: Let me tell you the big secret
Hank Sullivan
Hank Sullivan is a Forsyth County resident, businessman, author and speaker on American history, economics and geopolitics.

If you truly want to understand politics, including why D.C. politicians have become certifiably insane, read on.   

Virtually every desperate attack various establishment operatives launch against President Donald Trump, including the Russia hoax, calls for impeachment, and efforts by compromised intelligence agencies, originates from one central concern, the need to protect the American money-creation system and those who control it.  

Sit back. Relax. I’m about to reveal their big secret.

Recall last week, responding to statements by various “cut-spending,” or “balance-the-budget” advocates running for Congress, I wrote that President Trump chooses not to speak about federal deficits or the national debt, and for a good reason.  

The reason is that, as long as our present system is in place, it is mathematically impossible to either balance the federal budget without severely impacting the economy, or certainly to ever pay off the national debt. And that is not because government inherently spends too much. 

No matter how many responsible adults we dispatch to Congress to control federal spending, it will increase anyway because the system demands it, and cannot function without it.  That’s because there is direct, mechanical linkage between the growth of deficit spending and growth of the U.S. money supply that powers the American economy.

What I just described is published by the Chicago Federal Reserve in a downloadable format in a document entitled, “Modern Money Mechanics.”  

Modern Money Mechanics (MMM) describes how money is created and who creates it. By “money,” I mean Federal Reserve Notes, which are the dollars in your wallet, your bank accounts, etc.  

The upshot of the document, which you would likely never know except for reading my column, is that the entire U.S. money supply is borrowed into circulation, at interest, from the private banks of the Federal Reserve System. Since our money is all borrowed, it should not take a rocket scientist to understand why America, including its government, is over $70 trillion in debt. 

And the kicker is that the U.S. government provides the base collateral for every dollar this private system issues, effectively becoming a perpetual guarantor that all outstanding dollars loaned into the world will be paid back.  

Here’s how all that works, a process MMM describes on page 7. Before any new dollars can be issued by the system, the U.S. government must go into debt by issuing a debt instrument, let’s say a Treasury bill. Let’s assume a T-Bill face value of $10,000.  To enlarge the money supply, that T-Bill must be purchased by a Regional Federal Reserve Bank, let’s say the New York Fed, in exchange for 10,000 brand new dollars issued into circulation and deposited electronically into the account of the T-Bill’s seller at, let’s say, Goldman Sachs, a mega-Fed member bank in New York City.  

Next, under fed rules, collateralized by that single deposit, Goldman Sachs can create new dollars at-will to either loan out or invest, up to nine times the original deposit’s value. That means that one $10,000 T-Bill held by the N.Y. fed as collateral can permit Goldman Sachs, in this example, to issue as many as 90,000 brand-new loanable or investable dollars.  

So simply put, U.S. government debt underwrites the entire system. As more dollars are required for growth, the U.S. government must issue more debt and the Fed must buy it. 

If by balancing the budget U.S. debt does not increase, the debt service paid to issuing banks and withdrawn from circulation would cause the money supply to decrease. 

So unless the U.S. government continues to issue additional debt, to remain solvent the banks would be forced to call in dollars previously loaned or invested, decreasing the money supply, causing the economy to slow, and stock markets to tank.  Eventually a depression would occur, which is what happened during the 1930s. 

Now if any of this comes as news, that is only because those who control the system desperately hide the truth from you.  And because they control America’s money supply, the amount circulating and who receives it, until President Trump arrived, the “system” was in various ways dictating policy to our now-crazed politicians.  

Because that system creates its own money, financial brokers and their corporate cousins possess the means to purchase any influence necessary to keep government working for them, rather than the American people.  

That is why D.C. politicians are acting certifiably insane.  They don’t make sense as long as you believe they are working for you.  They do make sense once you realize they are working to protect a political system that put them into power and has matured around an illicit source of financial influence.

President Trump has sworn to wrest control of American government away from corrupt, global financial interests. 

Trump is a danger the system has never faced. He’s making the system’s protectors insane. Trump played the system and knows it well. And he has signaled that the corrupt and corrupting Federal Reserve System will be restructured to one that benefits the people rather than the financial elite. 

By simply flipping a switch already at Trump’s disposal, and placing the U.S. government as the controller and beneficiary of the system rather than private banks, the extraordinary profits the system generates for private banks would be re-channeled to pay off the national debt and retire any necessity for a federal income tax.  

Trump knows that. 

 Now you do. The big secret.

So if you truly want to understand politics, read this again. Share at will.

Hank Sullivan is a Forsyth County resident, businessman, author and speaker on American history, economics and geopolitics.