For some time now I have been rather quiet about the whole Banks bail out in the UK. I have been somewhat surprised how peeps do not realise that they have been conned.
OK many peeps make this claim, however lets look at a simple rule of Monetary lending. Banks are allowed to lend 10 times that which they actually hold. So for an example You deposit £10,000 cash.
The bank can now lend up to £100,000 based upon what they hold. So along comes the next person who takes out a £100,000. £90,000 of that will be other depositors money, £10,000 will be yours. However as far as the bank is concerned it actually created £90,000 from no where and never touched other depositors money.
Following it all yet?
If not, I will say that £90,000 of the money or 90% is fictional. So if this borrower defaults on the loan along with all other borrowers, how much does that bank really need to recover its hard cash debts?
10% of the quoted value.
How much did the tax payer get billed for?
What does this actually mean?
Answer: The tax payer gave the banks a full 900% profit by their bailouts, a return which is in fact one of the biggest financial frauds in history.
How does the Governments address this fraud?
Do they imprison the Bankers?
Nope they target the most vulnerable in Society and blame them for the current fictional financial situation.
So remember when you are struggling to buy food, pay your rent or even mortgage. Who you really have to blame for all this.
Those that would openly con the tax payer into giving them 900% profit for doing absolutely nothing more than selling debt then forcing a deliberate collapse.
Subnote: Another little fact that seems to skimmed past peeps. Lets say I am running a large banking corporation that is too large to fail, but I do not follow even the most basic rules when lending money for mortgages and you represent the rest of the Banks and the Governments in the World.
Even if you knew that all my lending was toxic,
- Would you foreclose on my accounts and collapse my company?
- Would you purchase all my debts at 10% of their value (The actual cash value) and effectively wind down my company?
If you chose the first option then congratulations, you just destroyed 3/4 of the planets economy.
If you chose the latter, then there was a little blip and no situation ever existed in which fake economic schemes like Austerity was ever needed.
I think we already know what the Worlds leaders and the Banks chose to do in their greed.