We’re gonna make you an offer that you can’t refuse… you give us the money and we take good care of you. Capeesh?
Oh wait, I forgot. That’s the way the mafia does it. We’re the good guys, right? So how about this… “We’re from the government and we’re here to help.” Nah, nobody would believe that.
Sometimes the line between organized crime and disorganized government gets blurry. Other times the line goes away completely. There’s nothing to see here folks, just keep moving along.
The United States Treasury raises cash by offering investors a treasury bond that pays interest as a return. The primary investor is now the Federal Reserve Bank. Other investors include US citizens, foreign citizens, and foreign countries.
In 2013, the Federal Reserve is purchasing a staggering $1.8 trillion in US treasuries, making them by far the largest investor. So as the single largest investor in treasury bonds, the Federal Reserve is earning interest payments guaranteed by the United States Treasury. That is a pretty sweet position to have.
And where does the US Treasury get the money to pay the interest? Their primary sources are American taxpayers and the Federal Reserve Bank, the very same people who are the primary investors in US treasuries.
Since the federal government operates with deficit spending every year they have no surplus funds available to pay the return to their investors. So where are they getting the money to pay interest to their investors? They are getting it from money they collect from the investors or from subsequent investors, which is the exact definition of a ponzi scheme.
From Wikipedia, here is the definition of a ponzi scheme:
A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation.
By this definition, which happens to be the correct definition, the United States Treasury is operating a giant ponzi scheme. Private citizens like Bernie Madoff have gone to prison for operating ponzi schemes. However, our federal government is openly doing the same thing.
Actually, what the US Treasury is doing is worse than a ponzi scheme because the money they are relying on to pay the returns to their investors is largely coming out of thin air, printed on the presses of the Federal Reserve. It is nothing more than monopoly money. It is not backed by gold or silver or anything at all.
Maybe it is time to send our government leaders to prison too.
Author: James Bailey
James Bailey is a blogger, business owner, husband and father of two grown children. In 1982, he surrendered his life to the Lord Jesus Christ. In 2012, he founded Z3news.com to broadcast the message of salvation by reporting end time news before it happens.
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