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raff rawrr(: December 5, 2010 at 7:40 pm

ah thanks

gray shadow December 6, 2010 at 7:23 am

Just to clarify a few points.- The Federal Reserve “Central” does not loan money to the Federal Reserve Branch banks. For proof, check out the here are balance sheets from the Fed Res http://www.federalreserve.gov/releases/h41/Current/ and the Chicago Branch http://www.chicagofed.org/economic_research_and_data/files/SEVENTH_DISTRICT.PDF . These loans do not show up on either balance sheet.- Regarding the “7 times”: I think you have a misunderstanding, or misapplying, of the Deposit Multiplier effect. In a single transaction, a bank cannot loan out more than it has in excess reserves, i.e. if it has $1 in the vault, it can only loan out $1, not seven. With the deposit multiplier, money from a loan will eventually be re-desposited and re-loaned.There is a theoretical maximum. For M1 (the most liquid assets), the effective multiplier is about 1.6. For M2 (M1+time deposits), the effective muliplier is around 7.- About 98% of all ‘profit” is returned to the Treasury at the end of the Fiscal year. Member banks make a standard 6% on their shares regardless of the ‘profit’ generated by their branch.- Side point: We typically say that Fed Reserve notes are not backed by anything. Which can, for most intents and purposes, be considered true. Technically, by law all Fed Notes have to be collaterizalized with some asset held by the Fed. Almost all of it is collateralized by Treasury Notes that the Fed purchases to get cash into circulation. And, believe it or not, a very small portion of Fed notes ($11B) is collaterized by gold. (see the Fed Balance sheet http://www.federalreserve.gov/releases/h41/Current/ ). One could look at the Fed balance sheet and say that 100% of Federal Reserve notes are backed by assets if you consider a T-Bill an asset. However, since this is government debt, it’s like writing yourself an IOU for $100, then say you have $100 in assets. Sounds sort of scammish to me.

Paul S December 6, 2010 at 7:51 pm

It looks like you are doing a great job of investing, not so good with your investing. You have traded appreciating assets for a depreciating asset. Check the value of your car with the current mileage on an car pricing site like Kelly Blue Book.For help in not wastefully spending your money check out Dave Ramsey. “Live like no one else today so you can live like no one else when you retire.”

leedleleedlelee December 7, 2010 at 7:20 am

well, thanks for thati think now i just have guilt for today because i didn’t make yesterday all it could beit would be nice to always these thoughts at forefront of your mind, but everyday worries often overcome, ask the day laborer to make the most out of everyday, everyday grinding in the hot sun, with worrying how to feed the family, whether the car will continue to drive, whether the electricity will remain on, will he ever be able to afford college for his children, how will he afford health care for his family if anything happenssorry I’m a little pessimistic today