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To Free A Lender-Owned Nation
The rich ruleth over the poor, and the borrower is servant to the lender.
Proverbs, 22:7
IV. Increasingly Absurd Tricks Miss The Point
This is the last of four articles
writing up a litigation I filed in federal court in San Francisco on December
28, 2011, against the U.S. Treasury. Johnson
v. Department of the Treasury of the United States, et al., case No. CV11
6684 (NJV). The suit alleges suppression of the great
benefits that would accrue to the government, if United States notes were to
replace Federal Reserve notes.
Part
I introduces the issues.
Part
II explains the scaffolding of facts and law that raises the issues.
Part
III summarizes the "Treasury-Fed Coin-Swap Cover-Up," and uncovers the
face-value fiat money tax.
Part IV uncovers the full interest relief.
1. The Suppression Of Interest Relief Per
Coin-Swap
Though this be madness, yet there is method in't.
[Shakespeare, Hamlet, Act 2, Scene 2]
Here is how the 1990 report explains its
rule that, when a $1 coin is put into circulation and a $1 note is withdrawn
from circulation, there is no net gain of interest relief to the taxpayer (page
42):
"Currently,
the Treasury receives the Federal Reserve's earnings on assets associated with
the outstanding 1-dollar Federal Reserve notes. Generally, the difference
between the face value of the notes and the cost of printing and an allocation
of Federal Reserve operating costs is used by the Federal Reserve to purchase
Treasury securities, which make up the Federal Reserve's portfolio. The Federal
Reserve credits Treasury with the earnings received from those investments. If
notes are withdrawn from circulation, the portfolio and its earnings are reduced
accordingly. We estimated the average
Federal Reserve portfolio earning rate to be 4.61 percent, the same rate we
used for the model's discount rate. We
multiplied this rate by the decreased value of l-dollar notes in circulation to
calculate the loss in portfolio earnings."
In other words, as
later GAO reports more simply put it, for coins that replace a note, there is
no net interest relief gain, because the interest relief on a dollar's debt
reduction is cancelled by the loss of interest returned by the Fed, from
holding a dollar less in government debt.
Thus, the later reports more simply calculate the interest relief using only
the count of coins added to the
currency. If the replacement ratio is
1.5, then the interest relief accrues from only the added 50% of circulating dollars.
