NESARA
The National Economic Stabilization and Recovery Act

Monetary and fiscal policy reform that will double the standard of living for every American
within one generation and restore economic and social prosperity across the land.

 
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Rabbits
Rumors—Treasury Reserve Banks
 

Don't chase me!We’ve decided to respond to the various rumors regarding the enactment of NESARA into law. After some late night surfing of the internet, and a couple of responses from some kind souls, we think we now understand the confusion.

The confusion probably arises from some of the terms used in a rumor (we dislike the word but nothing else fits) circulating for several years using identical or similar terms used in NESARA. We make no attempt to substantiate the rumor, but we see a thin possibility that NESARA and the rumored bill could be vaguely connected. The rumor apparently circulated strongly only within the past decade and we must remember that NESARA was originally proposed to Congress in the early 1990s. Although we are not looking for connections, we see the possibility.

The details of the recent rumor can be viewed at http://www.rumormillnews.com/cgi-bin/config.pl?read=4614. We saw a similar message being routed around the internet several months ago and did not make the connection until reading the previous information. The message that circulated once could be viewed at http://www.syninfo.com/ian/PRIVATE/2000/08/06/2000080620193454.html.

Interesting information, but the best we can offer is that NESARA was developed independently of any “outside” help. The bill was written based upon system theory analysis and years of study and research. In other words, engineering analytical tools were used to develop new equations and to study the root causes of social problems, then translated into corrective legislation.

In the hopes of quashing future rumors of this sort, let us offer to you some things to think about.

The rumored bill was supposedly passed in secret. That means 435 representatives and 100 senators, thousands of aides and tunnel rats, a president, a vice-president, a secretary of state, a secretary of the treasury, the director of the federal register, etc., all have kept the secret. We must also think that this bill was introduced to a secret nightly session of Congress and that every single media person was sound asleep. If you believe any of that you might also want to start looking for ocean front property in Nebraska.

Second, there is no record of any such bill appearing in the Thomas registry.

We also note there are some keywords used throughout the rumor that seem designed to excite and capture the attention of so-called patriots. Words and phrases like abolishing the IRS, abolishing the Federal Reserve System, restoring the Constitution, and the New World Order. Such verbiage should be a clue that something might be fishy.

Then there is the issue of removing citizens from admiralty and statutory law. That statement in itself should be clue to knowledgeable individuals that the rumor is just that—a rumor. These terms are hot words among “patriots.” The problem today is not admiralty or statutory law, but a gross negligence on the part of many people, in their failing to understand the nature and cause of most actions at law. Courts today merely respond within the capacity required by the pleaded action. People no longer need to physically visit the “correct” court, but instead visit any court (within appropriate jurisdiction and venue) and, depending upon the action pleaded, the court responds accordingly wearing the appropriate hat. Today, all actions begin as civil actions, but few individuals ever demand to know the nature and cause of the action. Is the action one of equity or law? Few ever ask, and then assume they have been railroaded because they do not understand the basic rules. The problem is not admiralty or statutory courts, but gross negligence of the respondents.

Another clue that something might be awry is the supposed new Treasury Notes will be backed 100% by precious metals. After many decades of not using commodities as currency, most students of monetary policy understand that a return to currency based exclusively upon commodity metals would be incredibly difficult. Murray Rothbard was fond of this idea, and wrote that a re-evaluation of gold would establish the price at somewhere around $1,217 (FRNs) per ounce. At such valuations, the reciprocal is 1/1,217 of an ounce of gold representing $1. A fifty cent piece would contain 1/2,434 of an ounce of gold. A dime would contain 1/12,170 of an ounce of gold. At such valuations, how small of a coin do you think would be needed to represent $1? Even if base metals (copper and nickel) were used to provide the substance of most of the coin, how would ordinary people verify that the new coin contained the appropriate amount of gold? We don’t know about you, but we think, “Not feasible, period.”

To those who have studied the NESARA proposal, you should know that NESARA does not create an exclusive “metals-backed” currency. Instead, NESARA re-establishes gold and silver coin as an alternative currency while converting Federal Reserve Notes into the new Treasury credit-notes. The exchange of FRNs for credit-notes will be one-for-one, not ten-for-one as the rumor states.

Unlike the rumored bill, students of NESARA will notice that no price or wage adjustments need ever be made.

There are other similarities in that the rumored bill claims some mortgages will be forgiven. Though NESARA eliminates much public and private debt, nowhere does NESARA forgive debt. Instead, all current secured bank loans made on a fractional reserve basis are recalculated according to the new law. Banks still make a profit on those loans, but for many borrowers, those debts will be recalculated as paid in full. This is not the same as forgiving a loan.

Even if the rumored information regarding counterfeit bonds is true, NESARA would render the entire discussion moot because NESARA requires all banks to exchange all government bonds for newly created Treasury credit-notes. Under NESARA, banks will not be allowed to use as reserves anything but the new credit-notes. Banks will be prevented from directly buying and holding government debt. Banks could still buy commercial paper that might indirectly hold government debt (mutual funds, for example), but nonetheless cannot use that paper as reserves. Therefore, under NESARA, banks cannot default because of using counterfeit bonds as reserves.

Lastly, we must add some sobriety to this story. Many people wrongly believe that one day the “money powers” will pull the rug and collapse the entire economic systems around the world. Any reasonable student of history, and banking in particular, should know that the last thing the so-called money powers would want is a collapse of the system. Debt-based businesses, especially when using compound interest, provide tremendous profit to those who live on the lending side of the fence. There is no way your average, live down the street, banker would ever want to see a collapse. Bankers have no desire to own tractors, cars, houses, etc., they are primarily interested in profits made from loans to others. In short, if anything, the so-called money powers will do everything they can to preserve the current system based upon compound interest. They learned their lessons well during the Great Depression and have no intention of making the same mistakes again.

Nonetheless, NESARA resolves many of these problems. NESARA provides for a sound currency; abolishes the diabolical income tax; replaces the income tax with a more fairer, equitable, and uniform national sales tax; respects fundamental rights by not taxing the necessities of life; reforms the banking laws so both borrowers and lenders come out ahead, eliminates an unknown but certainly significant amount of private debt; eliminates at least $1 trillion of public debt; and is designed to control currency inflation. Under NESARA, the purchasing power of the national currency will remain stable for generations to come, a highly desirable moral consequence.

We accept the misunderstanding arising from confusing NESARA with the current circulating rumor but strongly suspect the coincidence is purely happenstance.

Let us get back to solving the monetary and fiscal challenges before us, shall we!
 

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