How Do Banks Profit - Cause Before Symptom 6.26-24

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How are banks profiting? Let’s take a deep dive into banking practices and see why banks seem to be fraudulent. Let’s look at the numbers. I am a bank. I will put one million dollars on the table. This is what we have to loan to our little town. There are dozens of businesses here and they all want a small business loan and personal loans. According to fractional reserve lending, I have the ability to loan 90% of my cash to our town. All I need is 10% to keep in the vault to use for cash withdrawals and transactions. I took $100,000 from the money and put it in my bag to deposit into my safe. I start the process of every person in line to receive. I check their credit score, history and I ask references how honorable are they as a customer. 

Then I ask what collateral they have to give me if they default from paying me back. This has to be tangible assets that are paid off which value at or around 50% of the entire loan. Like, tractors, land, homes, cars etc. I also request a cash deposit. I would need 10% of the loan up front in cash in order to give the full amount of the loan we agreed. If successful, I am able to secure $90,000 in cash and if the loans default, I will lose 50% or more of my 1 million dollar investment. Many banks will offer different types of loans. Some where you pay the interest off first. That’s the one I choose. I am to make 10% interest on top of the loan amount. So, if successful and everyone pays everything off, my 1 million dollar investment should profit me $90,000 in cash, $100,000 in interest + late fees and other misc costs which most likely will bring around $10,000 in profit. Remember, I have $100,000 in the bank for fractional reserve lending. Total, after everything is $200,000 in profit.

Ok, that would make sense, but banks don’t work that way. They continue to make loans off of how much they are holding in reserves. The bank shows the federal reserve the loans they have. If after a year and people are paying on time, the banks request a loan from the federal reserve. This is to loan more money out and continue to receive monthly payments. This is where banks get into trouble. They borrow an amount of where they think they can loan for. They receive their funds and the bank starts paying a monthly payment to the federal reserve. Right now, the federal reserve interest rates are the highest they have ever been. Banks do not ask for loans around times like this. They wait until the interest rates are lower. Before 2008, federal reserve interest rates were at 0%. This is where bad people start cooking the books for quick cash and bailout. Now, back to my bank. Let’s say I borrowed money 10 million from the federal reserve at 0% interest. My monthly payments are around $150,000 a month to the federal reserve. As long as I make payments, I borrowed 10 million for free at 0%. Let’s say when I started my bank, the economy was amazing. The monthly payments I receive from my clients, after my loans of 10 million has been loaned out and secured via paper, should receive more funds than I owe every month. Let’s say we receive 5% of the 90% that we loaned out. We should earn $450,000 a month and owe the fed $150,000 a month for the 10 million dollar loan.  This leaves a total of $300,000 for the company. Sounds great if I stick to my business plan and do not spend any of it. But, my wife says she wants to pay off the house. I do so and I lose my profit that month. I paid off my $300,000 house and my bank still has 10% of 11 million I loaned out. Harmless I thought until I learned I had to pay taxes on that. But I have another $300,000 coming in next month and I will start using that to pay off the loan to the fed. This means pay more than my $150,000 minimum a month. Sounds great and profitable but life happens. A tornado came through town and destroyed half the town. This means 50% of your depositors may be late on payments. You were too busy paying off your house to invest in insurance coverage. Turns out the insurance cost for a town with possible tornadoes was $300,000 and you held off to pay off your house.

It only took a few months before your deposits went from $300,000 to $150,000. The town needs money to rebuild. You already loaned out 90% of 11 million and loaned out 90% already of the fractional reserves you had. Now, you have no money to lend and are only paying the fed’s monthly payment. Can you see the problem here? You gave the public 11 million. They spent it. You have nothing in savings because you loaned it out. And you can only afford to pay your loan minimum. Even if you recover 50% of the collateral, you still owe more than you can make. The moment you can’t pay the federal reserve their monthly payment, is when they take your collateral and close you down. Keep in mind, I never calculated payroll, taxes and fees to just be a bank. And of course I have given the  worst case scenario, too. But here’s the clincher. The federal reserve was in worse shape than you before you asked for the loan. They have done the exact same thing you did. Just under different circumstances. The federal reserve as of today, has loaned out 35 trillion and American only makes 28 trillion. We are 135% over our gross domestic products and services earnings. Since the federal reserve doesn’t allow audits, we don’t know the real number as I believe it’s higher than 35 trillion.

The United States government has lost its credit rating. It used to be a triple a. Now it’s a double a. Since Nixon took us off the gold standard, our last promise to pay off our loans was petro oil dollars because OPEC promised for a while to only trade oil for dollars. Now that deal is over. Nothing is backing the dollar except for our aggression and military. The federal reserve is not handing out free loans anymore. Our economy is being touted as stable, but this is because we have the power to say and do whatever we want. After all, there are 190 countries and we have over 200 military bases worldwide. We are the threat and bully of this age. In fact, our military partner NATO is in the same shape as us. They owe more than they make. This is why the west is picking a fight with the east. They gobbled up all the resources here and now they want theirs. Russia and China have both been defending their rights for a while now as America and its allies are playing offense. And the bank we started? Well, the federal reserve printed the money from our printing press, sold it as a bond and took 50% of our town’s resources to earn a living. Not because the wife wanted to pay off the house. Because absolute power controls absolutely. The tornado that destroyed the town wasn’t natural, rather was made by the ones who wanted to destroy that town. 10 million dollars was sent from thin air and backed by nothing. And 50% of the town’s assets are owned now by the federal reserve, which is a private western central bank that was created and controlled by foreign interests.