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A person holding a phone walks past burning vehicles following riots protesting the death of George Floyd, who died May 25 in the custody of Minneapolis Police, in Seattle, Washington on May 30, 2020.
JASON REDMOND

“Some therefore cried one thing and some another, for the assembly was confused, and most of them did not know why they had come together…And when the city clerk had quieted the crowd, he said…”we are in danger of being called in question for today’s uproar, there being no reason which we may give to account for this disorderly gathering.”

  • Eph. 19:32, 35, 39, 40

“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, and one by one.”

  • Charles Mackay, Extraordinary Popular Delusions and the Madness of Crowds

It’s hard to believe that less than a week ago almost no one knew the name George Floyd.  My, how things have changed.

Last week, I completed an outline for my planned post for today.  It was going to be a continuation of my series “This is Going to Hurt” and cover the topic of fiat currencies.  In fact, I planned on sticking with that topic as recently as yesterday.  But the more I thought about it in light of the riots convulsing my country, riots that are taking place even as I write, the less appropriate it seemed to address issues of monetary policy.  Not that monetary policy isn’t important.  But as a writer who seeks to apply the Scriptures to matters of economics and politics, sometime events reach a critical mass where they force themselves on you, whether you like it or not.  That’s where I find myself on this beautiful Sunday afternoon.

For my part, I’d rather avoid the topic of the George Floyd riots altogether.  For it is impossible to write honestly about these riots and without at the same time touching on the issue of race, an explosive topic that has intimidated more than a few commentators.  It may be that this author has himself ducked the topic over the years at least in part for that very reason.

Nevertheless, when major cities all across America are both figuratively and literally on fire – including my hometown of Cincinnati –  were I to remain silent, I would be shirking my duty as a writer.

So with all that said, let’s dive into this ongoing mess as see what items of interest we can find. 

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Jerome Powell, Federal Reserve Chairman.

“We print it [money] digitally.  So as a central bank, we have the ability to create money digitally. And we do that by buying Treasury Bills or bonds or other government securities.  And that actually increases the money supply.”

I probably shouldn’t be, but I often am, amazed an God’s providential timing in providing illustrations of points I plan to talk about.  As I’ve been thinking about this series of posts, I planned this week to write about the Fed and the process of money, more properly currency, creation. 

In one respect, the process the Fed uses to bring currency into being is fairly easy to grasp.  On the other hand, it is so obviously fraudulent that it shocks people when they hear about it. “That simply can’t be.” is, I think, a fairly common reaction. 

In the Lord’s providence, and quite apart from any planning by me, it so happened that Jerome Powell, the Chairman of the Federal Reserve, was interviewed on 60 Minutes last Sunday by correspondent Scott Pelley of CBS News.  You can watch the full interview and ready the transcript here.  In my opinion, Pelley did a good job asking important questions of Powell, especially concerning the process by which the Fed prints money.  At one point, Pelley asked Powell about the Fed’s response to the coronavirus (CV) crisis, and Powell ticked off a list of the Fed’s market interventions.  Here’s what was said next,

PELLEY: Fair to say you simply flooded the system with money?

POWELL: Yes. We did. That’s another way to think about it. We did.

PELLEY: Where does it come from? Do you just print it?

POWELL: We print it digitally. So as a central bank, we have the ability to create money digitally. And we do that by buying Treasury Bills or bonds or other government guaranteed securities. And that actually increases the money supply. We also print actual currency and we distribute that through the Federal Reserve banks.

There you have it.  The Fed chairman admitting on national television that the Fed creates money and uses it to buy, “Treasury Bills or bonds or other government guaranteed securities.”  He also noted that this activity, “actually increases the money supply.” 

What I would like to do in today’s post is to examine these statements – Powell’s saying that the Fed “creates money” and that this act “actually increases the money supply” – in greater detail.  Just how does the Fed create money and what are the effects of “increasing the money supply” on our daily lives? 

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The_Phillip_Medhurst_Picture_Torah_122._Abraham_purchasing_Ephron._Genesis_cap_22_v_16._Hoet (2)

Abraham purchasing the cave of Machpelah from Ephron by Phillip Medhurst. Courtesy of Wikimedia Commons.

Abraham weighed out the silver for Ephron which he had named in the hearing of the sons of Heth, four hundred shekels of silver, currency of the merchants.

  • Genesis 23:16

In his lecture “Money, Freedom and the Bible,” John Robbins argued that the manufacturing of money was not a proper function of government, because there is no warrant for this in Scripture.  The Bible charges the civil magistrate with the duty to punish evildoers and reward the good.  There is no mention of anywhere in Scripture of God granting civil governments the right to manufacture money.

The first time I heard this many years ago, I was shocked by this idea.  “But all governments manufacture money,” I thought to myself.  “If the government didn’t supply money, who would?” I continued.

Of course, my initial objection can be answered by pointing out that simply because a thing is done does not logically imply that it ought to be done.  In the 18th century, David Hume famously made this point.

Secondly, concerning who would supply money in the absence of governments, the answer to this is the market would take care of this.  As Robbins noted in his lecture, there is such an example of this in Genesis 23, where Abraham pays for the field to bury Sarah by weighing 400 shekels of silver, “currency of the merchant.”  Note that it was not the currency of Pharaoh, nor the currency of the King of the Hittites that Abraham weighed out.  It was the currency of the merchants.  That is to say, it was a unit of money that arose from the common practice of the free market.  Importantly, it was not a government issued currency, neither was it the product of a government licensed central bank.

For that reason, that it arose in the marketplace and was privately managed by the merchants who used it, the shekel weighed out by Abraham was an honest unit of money.  The same cannot be said for sovereign currencies of our day.  Not only do they fail to maintain purchasing power, but they are deliberately designed to lose value over time.  To this author’s knowledge, there is not one honest currency in use today, including, and perhaps especially, the U.S. Dollar.

Last week’s post titled “This is Going to Hurt, Part 1: Honestly Facing our National Bankruptcy,” discussed the disastrous economic numbers coming out as a result of the government’s response to the coronavirus pandemic.  Please note, I did not write, “the disastrous economic numbers coming out as a result of the coronavirus pandemic,” but, “the disastrous economic numbers coming out as a result of the government’s response to the coronavirus pandemic.” It is not the Chinese coronavirus that caused over 30 million Americans to lose their jobs in the past six weeks, it is decision, more accurately decisions, of various government officials that have led to this disaster.

But oddly, as I also noted, the stock market has rebounded even as economic activity has made record declines.  How can this be?  The short answer to this question is money printing on a mind-blowing scale by the U.S. Federal Reserve, the central bank of the United States.

My purpose in this post is to lay out in non-technical language what a central bank is and what it does.  In subsequent posts, I shall illustrate the unbiblical, immoral nature of central banking by looking in detail at the origin, the workings and the disastrous effects Federal Reserve (the Fed) policy has had on our nation.

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Mnuchin.Unemployment

U.S. Treasury Secretary Steve Mnuchin warns that unemployment could reach 25%, a level equal to that of the Great Depression.  But according to economist John Williams, not only are we already at 25% unemployment, we’re well  past it.

Assuredly, I say to you, you will by no means get out of there till you have paid the last penny.

  • Matthew 5:26

 

“Trump administration is ‘willing to spend whatever it takes’ to mitigate coronavirus crisis says Steven Mnuchin as he continue to facilitate bipartisan negotiations – but admits unemployment could hit 25%.”

That somewhat longish headline leads story from today, May 10, 2020 in the Daily Mail.  A few things are worth noting here.  First, the current economic crisis is called, inaccurately, the “coronavirus crisis.”  The massive unemployment and terrifying declines in industrial production that have hit the U.S. and other Western nations has not been caused by the coronavirus.  It is the government’s response to the coronavirus that is the immediate cause of the 20 + million private sector jobs lost in month of April.  To put that number is some perspective, the previous record monthly job loss number was 800,000 + which occurred during the height of the 2008 financial crisis in March 2009.  The virus did not shut down the economy and cause record job losses; the politicians and bureaucrats did.  By calling it the “coronavirus crisis,” politicians are attempting to shift the blame from themselves to a virus.

Second, the negotiations in which U.S. Treasury Secretary Steve Mnuchin is immersed involved more money printing by the Federal Reserve and more deficit spending by Congress.  The truth, that Fed money printing and prodigal spending by Congress are the root cause of our current economic crisis, is nowhere to be seen.  Treasury Secretary Mnuchin wants you to believe that the cure for our financial woes us is doing more of the same things that put us in this mess in the first place.

Third, note well that Steve Mnuchin is facilitating “bipartisan negotiations.” As a lifelong Republican – I’m from the Tea Party/Ron Paul wing of the Republican party, not the mainstream, but nevertheless I am a Republican – I hate to admit that the my own party is in part responsible for the incompetent and immoral response to the coronavirus, a response that has included doling out literally trillions of dollars, dollars all which had to be borrowed into existence by the combined efforts of Congress and the Fed.  I would like to blame all of this on the Democrats, but that is simply would not be honest.  It is Democrats and Republicans conspiring together to spend money we don’t have in ways that were never authorized by the Constitution.  With a few exceptions, nary a peep of protest is heard from either party concerning the shockingly large spending programs already put in place, programs which Rep. Thomas Massie (R-KY) called, “the largest wealth transfer in history.”  And now Congress is colluding with the Trump administration on even more deficit spending.

Fourth, Steve Mnuchin admits that unemployment could hit 25%.  Here’s some news for Mr. Mnuchin, most likely unemployment is already well north of that figure.  Actually, it’s probably not news to him at all.  One suspects he already knows this.  What a lot of people don’t know is that the government changed the way it calculates unemployment.  In 1994, the Bureau of Labor Statistics (BLS) stopped counting long-term discouraged workers – a long term discouraged worker is someone who has not attempted to find work in the last four weeks – as unemployed.  Previous to that, such person were included in the unemployment calculations released by the BLS.  John Williams is an economist who runs his own website called Shadow Stats.  Among the services he provides is a monthly calculation of the unemployment rate using government’s old method.  Want to take a guess at where he puts current unemployment?  Try 35%!  If Williams’ numbers are anywhere near accurate, we already have a far worse employment situation than what occurred during the Great Depression, which is usually estimated at 25%.  Presumably, that’s the reason Mnuchin picked the number that he did.

So much for the Daily Mail’s headline.

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Fauci

Dr. Anthony Fauci speaks at a White House press briefing.

The so-called corona virus (CV) pandemic has taken the world by storm.  Like many people, this author had never so much as heard the term “corona virus” until about three or four months ago.  But writing now in early May 2020, it seems as if it’s been with us forever.

One of the barriers to thinking clearly about the CV pandemic and resulting lock down of the economy was the remarkable speed at which it all occurred.  It seemed that one day all was well, and the next that governors across the country were ordering their citizens to “shelter in place.”  It was almost as if the entire nation were sucker punched at once.  One day we were going about our business, working our jobs as we always had, and the next we were working from home or not working at all.  Who could ever have imagined such a thing as recently as the beginning of this year?

The official narrative is that the virus is an unexpected event, originating in China.  Despite the Chinese leadership’s heroic efforts to contain it, the virus managed to spread throughout all the world.  Here in the US, Anthony Fauci is officially hailed as a hero and governors who locked down their states are thought to have taken bold action to save the nation from an even higher death count than has been reported.  They are heroes.  And the more severely they locked down their states, the more heroic they are.

Although the rapidity at which the crisis emerged and my unfamiliarity with pandemics made analysis difficult at first, the whole CV pandemic always seemed more than a bit suspect to me.  And the longer it has gone on and the more information that has come out, the more my original suspicions have been confirmed.  Below are thirteen reasons why I doubt CV narrative.

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All Seeing Eye

The kings of the earth set themselves, and the rulers take counsel together, against the LORD, and against his anointed.

  • Psalm 2:2

 

In last week’s post, we considered the many passages in Scripture which speak of conspiracies.  It seemed good to approach the subject of conspiracies in this way for at least two reasons.  If the fist place, this is a Scripturalist blog.  As such, it is the goal of this author to approach every subject with the understanding that that the Bible has a systematic monopoly on truth.  If one can establish that the infallible, inerrant Bible clearly teaches that conspiracies have occurred in the past, this poses a significant problem for those who claim, as some do, that it is impossible for conspiracies to occur today and to dismiss those who have doubts about the official explanations as “conspiracy theorists.”

A second reason for placing a post on biblical examples of conspiracies first in this series is one of interest.  It’s likely that many Christians have not considered the extensive evidence supporting the existence of conspiracies furnished by well-known Bible passages.  Coming to see these passages as examples of conspiracies not only adds to our understanding of Scripture, but gives Christians added intellectual ammunition to analyze events of the present day.

In today’s post, I would like to explore the term “conspiracy theory” itself.  As it turns out, one can make the case that the term “conspiracy theory” is, oddly enough, something of a conspiracy.

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