Topic: You work your butt off, and a rich dude does nothing and gets rich - how? - page 7. (Read 23781 times)

See what the fat cats of Australia own:

http://www.macrobusiness.com.au/2014/08/aussie-politicians-300m-property-portfolio/

Actually, the banks literally create money out of nothing. They literally create money on the spot when loans are provided. They don't even need to borrow money from the Fed Reserve to do this.

Nice one.

Rich dude study the game and play along while the poor dude complain injustice rather than play along.

Rich dude: I engage with the government and lobby for changes that help me.
Poor dude: I complain to other internet users about how shitty the government is.

Rich dude: I keep complete control over my money and make it work for me.
Poor dude: I got a payday loan to buy the newest Sony TV.

Rich dude: I manage a diverse and balanced portfolio to maintain my wealth.
Poor dude: I invest in lotto tickets and own many beanie babies.

Rich dude: I follow economic trends and study any relevant developments.
Poor dude: I heard on infowars that secret societies can read your mind.

Exactly.

Take the Federal Reserve for example: US govt wants to inject cash into economy, so it goes to FR sells some bonds, and FR "prints" a billion dollars. That billion dollars gets deposited into banks (electronically of course- none of the currency actually exists), the banks then (thanks to fractional reserve) create 9 billion dollars via voodoo banking magic. Now there is $10B additional currency in the system that can then be used to provide loans, credit etc...which is what leads to bubbles, and credit crises, and then when someone decides to call the loans due, the house of cards comes tumbling down (unless the government steps in again with another round of QE).  Currency is backed by nothing more than the debt that was used to create it. That debt is backed by every living, breathing American that is born, as there is the understanding that you grow up, you get a job, you pay 35% of your earnings back to the government through taxes (which barely covers the interest that's due) and the whole cycle repeats itself.

The Fed continues to make money, and the families that control the banking industry continue to get richer while the middle class is further destroyed.

This is why crypto is so disruptive, it challenges the status quo of people who have literally controlled EVERYTHING for generations.

Well those whose objectives are to be become wealthy and nothing more (not create a company to be proud of, not create a product to change the world) often look for work that bypasses not hurdles and attempts to exploit some resource (human, manmade or natural).  Those people's goal is strictly money - and they don't care how they get it.  Some may indeed "work" hard, but they may not actually be doing "work" in the sense of creating something purposeful.

Most burglars in a large city "work" - they just don't accomplish anything.

Only by choice.  Most rich people 'work' through a division of labour, meaning all the slog and the actual real work is passed down the hierarchy to the thousands or millions of employees who are only paid 'competitive salaries' (meaning subsistence wages or barely middle class).

The hardest thing in this world is becoming a credentialed professional and yet most professionals in this world are only middle class in income and hold a lot of responsibility, have to be accountable and run the risk of being terminated at any moments' notice.

If 'many rich dudes also work their butt off', is the case then maybe they should just quit that hard work and become a Doctor, an Accountant or one of those lazy lawyers?  Heck just quit and do something like fix piping underneath houses for 12 hours a day, so easy!

AFAIK many rich dudes also work their butt off, even busier than most of us.

I love these quotes from this link https://en.wikipedia.org/wiki/Fractional_reserve_banking:

The proceeds of most bank loans are not, however, in the form of currency (central bank money). In the United States, the Federal Reserve Bank of Chicago has stated:
Of course, they [commercial banks] do not really make loans out of the money they receive as deposits. If they did this, they would be acting just like financial intermediaries and no additional money would be created. What they do when they make loans is to accept promissory notes in exchange for credits they make to the borrowers' deposit accounts. Loans (assets) and deposits (liabilities) both rise....[21]

The American Bankers Association has also stated that most bank loans are made not by doling out paper currency and coin, but instead by creating or increasing deposit liabilities owed by the bank:
Typically, bank loans are made to existing customers, or the proceeds of a loan are used to open an account; thus, most bank loans increase total deposits. In the typical credit situation, two balance sheet items --loans and deposits -- are simultaneously increased.[22]

Avoid debt. We need positive money in our financial system, as in non-debt based money. Either the government provides it (see Japan post 1990) or choose a digital currency to do the job. Btc is ok but has no privacy. Darkcoin is interesting. Gold is relevant to barter economies which I don't think we are going to revert to.

Ive had this feeling forever. How to scape? 

See GFC, wealth/money can be instantly destroyed.

You don't know what backed means.   Whats Ozziecoin backed by?

You can buy just about any goods and services using fiat. So it is backed by something.

As money is being created out of thin air, effectively it is backed by nothing.

Hardly anyone here knows the meaning of 'backed'.  It means 'convertible to'.

A long time ago when we had gold notes,   "backed by gold" means convertible to gold.  

Nowadays,  the Federal Reserve assets still have gold but mainly securities.  So USD is only convertible to USD but its value is derived from Feds assets.  On forex different currencies prices has to do w the issuing country's economic output amongst other things

Bitcoin,  however is pure speculation because its value is not derived from anything other than market forces.  The closest we ever got to a bitcoin economy was silk road.

Some people thinks the value of bitcoin is tied to the cost of production.   Like how much it costs to mine 1 BTC.   If you think this then you see bitcoin as a commodity not as a money

Credit is money by definition,  whether you have a moral objection to it or not

You cannot generally back fiat...it is either backed or not. As well, by the very classification of FIAT means that it is back by nothing but the "Faith and Credit of the Govt"
Also, currency and interest rate are NOT regulated by the market...it is determined by the Federal reserve, specifically the FOMC. The two of you are spewing bullshit!!
Faith and Credit doesn't mean jack shit either as the credit is just monetized debt. Quit playing games, man.

If the currency and interest rate are regulated by market, then the statement "Fiat is generally backed by the economy(production and service) of the country" assessment is mostly correct.

Are you f*#king kidding me? You are joking right? If not, that is a hilarious statement...you ought to become a comedian.

Your right about leveraging causing fragility but by definition shadow banking is unregulated banking.  We can regulate CDSs for example but the banks will just invent new financial intruments.