Friday, June 15, 2007

Critical Mass and the U.S. Economy

By Bill Price

“Critical Mass” is a scientific term sometimes used outside the world of science to describe a threshold crisis. Our present day monetary system offers a striking parallel to that term. Paper certificates (Federal Reserve notes) and digits on bank ledgers are supposed to be equal to available goods and services in our economy. The flow of these notes (credit currency) and digits (loans) through our nation’s banks act as the financial blood within our country’s economic anatomy. This is how the Federal Reserve explains currency: “In the United States neither paper currency nor deposits have value as commodities. Intrinsically, a dollar bills is just a piece of paper, deposits merely book entries.” (Modern Money Mechanics, Federal Reserve Bank of Chicago)

People with a basic understanding of how our money is created, through borrowing from private banks like the Federal Reserve Bank, know that our monetary system has reached “Critical Mass”. Real money created by Congress through its constitutional power (Article I § 8 part 5), would not work in this analogy, but a medium of exchange generated by private bankers through credit represented in Federal Reserve notes provides an excellent example.

Critical Mass

A fatal economic chain reaction has been set in motion through compounding the interest charged on bank credit. The correlation between a monetary system which sanctions money creation by entering digits on bank ledger sheets (fiat), then catapulting its growth through compound interest, and nuclear science, can be illustrated in the following: Plutonium, when collected in large enough quantities can begin self-sustaining chain reactions. If such chain reactions go beyond critical stages due to sufficient mass its “good-night Irene”. With massive amounts of fiat money (bank credit), being continually energized through compound interest (like in our current monetary system), it will be good-bye prosperity. We have literally trillions and trillions of “dollars” generated from the Federal Reserve Bank and circulating throughout the world. One of the triggers used to achieve a nuclear explosion is the gun barrel method, firing one sub-critical mass into a target consisting of another sub-critical mass; when the two masses collide a supercritical mass appears in a nuclear mushroom cloud. The heart of our monetary system (Federal Reserve Bank) rhythmically pumping credit dollars (Federal Reserve notes) into our economy with each new loan will serve as the fuel for uncontrollable chain reactions. These masses of steadily increasing notes throughout the economies of the rest of the world will likewise cause additional chain reactions through the system of “fractional banking”. When the Federal Reserve “notes” held in foreign banks, like China and Japan, collide with existing domestic notes/dollars, already in circulation and on bank ledgers, they will explode into a state of virtual worthlessness.


The monetary magicians from the Federal Reserve and their servants at the U.S. Treasury will try to resurrect their pre-existing credit empires by reissuing a new bank currency under the seal of the U.S. Treasury, but still outside the authority reserved only for Congress, as written in the U.S. Constitution (Article 1 §8 part 5). Their attempts predicated on the same unworkable fiat models are automatically doomed for the same reason… Thou shall not create money out of the thin air. “That’s right – Banks create money.” (through a process called “fractional banking) “Suppose for example that somebody borrows $90 and pays a bill with it. Whoever receives the 90 payment is likely to deposit it in another bank which can lend $81. Whoever receives the payment will deposit it in another bank, which will lend $72…” Federal Reserve Bank of New York, Public Information Department, 33 Liberty St., New York, NY.

With bank reserve requirements at 10% of the deposit amount (fractional banking), a single deposit of $100 can be used to create nearly $1,000. Additionally, the Federal Reserve is not an agency of the U.S. Government as most Americans are led to believe. It is a privately owned, for profit banking operation. The primary reason for this misconception in the public mind is that our dominant media has been willing to assist the in propagation of such myth through their deliberate acts of repeated omission. This fact concerning the private for profit nature of the Federal Reserve should have been part of public knowledge long ago.

Voodoo Economics and the Income Tax

Money is created through a Federal Reserve policy of monetizing debt. The government’s addiction for steady doses of borrowed money from the Federal Reserve Bank is infamous. Trillions of dollars have been created through loans and are owed to the Federal Reserve, by the U.S. government. The catalyst in this arrangement, enabling our government’s spending addiction, is the collateral for loans, the Federal Income Tax. The flyer, “Withholding a la Manhattan”, found at, concisely exposes the false statements and myths propagated by the IRS concerning the ordinary working person’s “liability” for that tax. Although the Federal Income Tax is perfectly legal, it is deliberately being misapplied. Private (non-corporate) US citizens, working for private companies within the 50 States are alleged by the IRS to have a “liability” to pay a direct, un-apportioned “income” tax. The IRS makes false statements in their official literature in order to deceive U.S. citizens concerning the issue of liability. The Federal Reserve, which is a private international banking cartel, willingly lends/creates all the funny money our government wants as long as the collateral/tax is guaranteed in the deal. Many in officialdom are content with the institutionalized abuses (direct, un-apportioned income taxes) and believe that the primary function of all U.S. citizens is to provide “security” for the interest on the national debt which is constantly being expanded by sycophant officials in the U.S. Congress. U.S. citizens are willing to pay taxes for the necessities of their government’s operation, not to fulfill its wildest dreams through massive borrowing.
Ground Zero

When this runaway debt train meets with the mass of soon to be returning U.S dollars held in the vaults of foreign countries, it will be too late. Our monetary system, thanks to the Federal Reserve’s pseudo monetary policies, has reached “critical mass”. What can you do? Insist on the exercise of our Constitutional mandates for money creation in Article 1 § 8 part 5 and for direct taxation in Article I § 2 part 3 and Article I § 9 part 4. Visit for more information on the Federal Income Tax. There is a constitutional remedy already in place, which, if enforced, will effectively stop the countdown to economic oblivion.

Congressional failure to enforce the constitutional prohibition in Article 1 against private money creation is the primary cause of all the trouble. Additionally, direct taxation on labor in violation of the apportionment requirement in Article 1, was manifested in the passage of the 1942 “Victory” Tax Act. The payroll withholding enabled by the “victory” tax has made virtual slaves out of American workers. Unconstitutional policies permitted by Congress and the courts are the real villains strangling America’s middle class dreams of prosperity and freedom.

Bill Price


1) Modern Money Mechanics, A Workbook on Bank Reserves and Deposit Expansion. Federal Reserve Bank of Chicago, P.O. Box 834, Chicago, IL 60690

2) The Story of the Federal Reserve System, Federal Reserve Bank of New York, Public information Department 33 Liberty St. New York NY 1005

3) The World Book Encyclopedia, Atomic energy

4) “Money Creators” and “Lawful Money Explained”, Gertrude Coogan

5) “Wealth and Virtual Wealth”, Frank Soddy


Blogger DaisyNavidson said...

Then, in addition to refusing to pay compound interest to the Fraudulent Reserve plantation lords through labor taxes, shouldn't we also be unburdening ourselves of them by creating our own monetary system? Creating our own local, interest-free currencies is one solution already in the works. Another solution would be to replace our inflationary debt-money system with a superior (even if still centralized) monetary system, such as The American Monetary Act.

7:32 AM  

Post a Comment

Subscribe to Post Comments [Atom]

<< Home