Thursday, November 15, 2012

Terms of Use - Federal Reserve Bank of New York

To all collective sovereigns,

Before reading anymore of this email listen to this very informative ‘You Tube’ video You can stop at the 12 minute mark of the 2 hour video and listen to the 12 minutes over and over until you fully understand the fraud. When you see the following on the screen it is what the fraud is all about:

“If there were no debts in our money system, there wouldn’t be any money.” – Marriner Eccies – Governor of the Federal Reserve, September 30th, 1941 in the House Committee Hearing on Banking and Currency.
This is the only problem we have which they use to control all of us. Are WE all hopelessly enslaved? I don’t believe so because as the collective sovereigns we do not have to allow this fraud to continue for one more year. If anyone tells you that they are going to reduce the debt that means more recession because what they really are saying is that they are removing the debt money from circulation and you know what that causes don’t you? If you don’t get back to me after listening to the first 12 minutes.

I am all about knowing the truth and verifying facts so that everyone can understand the only solution to our problem. There are a lot of problems that need to be fixed by first we have to stand up with knowledge. We have to declare our sovereignty as Free Union State Citizens and then restore the Lawful free Union State by first inhabiting it not the unconstitutional de facto government that was created without any delegated authority by people in our history.

How does anyone get around something like I found on one of the Federal Reserve website?
I don’t believe many attorneys could state that they “have read, understand and agree to be bound by these Terms of Use”.

As one of the collective sovereigns inhabiting the Free Union State of Kansas I am reading this for educational purposes to make sure that this entity is operating within the Organic Federal Constitution. I am also sending it to others for their education of what is going with the money that we have been forced into using which I believe to be unconstitutional. This is the main reason for providing this information as educational research.
If anyone else can shed some light or better explain what is provided within the following information posted on the two webpages both being provided as educational purposes only - please reply. My questions or notes are in red.

… you signify that you have read, understand and agree to be bound by these Terms of Use. Your use of the Services may also be subject to additional terms, conditions, agreements and privacy policies of third parties providing services or content on the website, including those of TypePad and Taleo and providers of images or multimedia content on the website.

If you do not agree with any portion of these Terms of Use you may exit the website and not continue the session or make use of any Services. However, if you continue to use the website or the Services you implicitly consent to these Terms of Use.

August 27, 2012
Interest on Excess Reserves and Cash “Parked” at the Fed
Gaetano Antinolfi and Todd Keister
The European Central Bank recently lowered from 0.25 percent to zero the interest rate it pays on funds that Eurozone banks hold on deposit with it. On the same day, Denmark’s central bank began charging banks 0.20 percent (that is, paying a negative interest rate) on certain deposits. These events have led commentators to ask what would happen if the Federal Reserve were to reduce the interest rate that banks in the United States earn on funds in their reserve accounts from its current level of 0.25 percent. In particular, some people wonder if lowering this rate would lead banks to hold smaller deposits at the Fed and instead lend out some of these “idle” balances. In this post, we use the structure of the Fed’s balance sheet to illustrate why lowering the interest rate paid on reserve balances to zero would have no meaningful effect on the quantity of balances that banks hold on deposit at the Fed.
    Since 2008, the amount of money banks hold on deposit at the Federal Reserve has increased dramatically, as shown in the chart below. The vast majority of these funds represent excess reserves, that is, funds held above the level needed to meet an institution’s reserve requirement. (See this Federal Reserve Bank of Richmond paper for a more detailed view.) Some observers have called for the Fed to lower the interest rate it pays on excess reserves (often called the IOER rate) as a way of encouraging banks to maintain lower balances.


What happened in July 2008 that made these deposits happen and held by the banks of the Federal Reserve?

The View from the Balance SheetIt’s important to keep in mind, however, what determines the total quantity of these balances. One way of understanding the issue is by looking at the Fed’s balance sheet, a simple version of which is presented in the table below.


I thought a balance sheet balanced as the total assets equaled total liabilities. To obtain the last published balance sheet go to this webpage and follow the directions to download as a word document. I have attached the lasted one for you to view -  If you have any questions about the attachment please send them via email with a phone number.
I have been looking over Balance Sheets since I opened up my office back in 1974 as a Financial Planner, Cash flow examiner, and Estate Tax Planner. I read my clients Will so that we could talk about what they did for their families. I have been in a force retirement since my accident I have in 1989.
Now read the next paragraph where it says, “The other significant liability is currency in the form of Federal Reserve notes”. If ‘Federal Reserve notes’ are a liability many be should all burn ours. LOL
    As the table shows, the balances that banks hold on deposit at the Fed are liabilities of the Federal Reserve System. The other significant liability is currency in the form of Federal Reserve notes. Together, this currency and these deposits make up the monetary base, the most basic measure of the money supply in the economy. The composition of the monetary base between these two elements is determined largely by the amount of currency used by firms and households (both in the United States and abroad) to make transactions and by banks to stock their ATM networks.

    What determines the size of the monetary base? As with any other institution’s balance sheet, the Fed’s dictates that its liabilities (plus capital) equal its assets. The Fed’s assets are predominantly Treasury and mortgage-backed securities, most of which have been acquired as part of the large-scale asset purchase programs. In other words, the size of the monetary base is determined by the amount of assets held by the Fed, which is decided by the Federal Open Market Committee as part of its monetary policy.

    It’s now becoming clear where our story’s going. Because lowering the interest rate paid on reserves wouldn’t change the quantity of assets held by the Fed, it must not change the total size of the monetary base either. Moreover, lowering this interest rate to zero (or even slightly below zero) is unlikely to induce banks, firms, or households to start holding large quantities of currency. It follows, therefore, that lowering the interest rate paid on excess reserves will not have any meaningful effect on the quantity of balances banks hold on deposit at the Fed.

Language MattersThe language used in the press and elsewhere is often imprecise on this point and a source of potential confusion. Reserve balances that are in excess of requirements are frequently referred to as “idle” cash that banks choose to keep “parked” at the Fed. These comments are sensible at the level of an individual bank, which can clearly choose how much money to keep in its reserve account based on available lending opportunities and other factors. However, the logic above demonstrates that the total quantity of reserve balances doesn’t depend on these individual decisions. How can it be that what’s true for each individual bank is not true for the banking system as a whole?

    The resolution to this apparent puzzle is that when one bank decides to hold a lower balance in its reserve account, the funds it sheds necessarily end up in the account of another bank, leaving the total unchanged (see FT Alphaville and this New York Fed Current Issues in Economics and Finance article for more detailed discussions of this point). In the aggregate, therefore, these balances do not represent “idle” funds that the banking system is unwilling to lend. In fact, the total quantity of reserve balances held by banks conveys no information about their lending activities – it simply reflects the Federal Reserve’s decisions on how many assets to acquire.

Other ImplicationsThis logic doesn’t imply that changing the IOER rate would have no effect on banks’ lending decisions, of course. A change in this rate could feed through to changes in other interest rates in the economy and thereby potentially affect the incentives for banks to lend and for firms and households to borrow. Lowering this rate may also lead to disruptions in markets that weren’t designed to operate at very low interest rates (see this earlier post for a discussion). Households and firms could respond to these changes in ways that either increase or decrease the amount of currency in circulation, the level of bank deposits, required reserves, and other variables. These shifts would likely be small, however, and should not obscure the basic point: The quantity of balances banks hold on deposit at the Fed would be essentially unaffected by a change in the IOER rate.

    A final note: If the IOER rate were set sufficiently far below zero, banks may choose to store currency rather than hold deposits at the Fed, and households may prefer holding cash if banks impose significant fees on deposits. In this case, the level of reserve balances would decline, but the change would simply reflect a shift in the composition of the monetary base; its total size would remain unchanged for the reasons described above.

The views expressed in this post are those of the authors and do not necessarily reflect the position of the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions are the responsibility of the authors.

Gaetano Antinolfi is a senior economist at the Board of Governors of the Federal Reserve System.

Todd Keister is an assistant vice president in the Federal Reserve Bank of New York’s Research and Statistics Group.
Posted by Blog Author at 07:00:00 AM in Financial InstitutionsMonetary Policy

No comments:

Post a Comment