Sort of vaguely right, Arjay, as far as it goes. I know many ten-year-olds who can describe the process better than this, but you do get props for at least trying.

>>The US Federal Reserve creates money in their computers and loans it to the US Govt.The people are then taxed by the Govt and have to pay back inflationary money plus interest to a private cartel of banksters.<<

But you have missed out quite a few steps along the way, including a very important one, how the money thus "created" actually gets into the economy. So far, you appear to have it stuck with the government. Any thoughts on that?

Anyway, you failed to respond to the question. I'll repeat it here, in case you missed it earlier.

"...show us how you 'create money debt free to equal our increases in productivity and inflation', and how you 'create money from nothing to equal our increases in productivity and inflation'.

Those are the phrases that you continually employ in order to disguise the fact that you haven't the vaguest clue about how the financial system works.

>>A partial audit initiated by Ron Paul found that the US Federal Reserve in 2008 created an additional $16 trillion in off balance sheet transactions<<

I'll wager a small amount that you cannot distinguish between on- and off- balance sheet transactions, as they apply to the government. Care to take me up on that?

>>You either have a total disconnect with logic and reality or are profiting from this scam via the dervivative market that feeds off it.<<

There you go again. We have already established that you do not understand the derivative market, yet here you are again, waffling on about it as if it is some kind of scam.

Admit it, Arjay. You haven't a clue, have you.

Pericles,you think that you can confuse people with accounting porcedures.Fannie May and Freddie Mack had leverage of 333:1.This meant that for every dollar of deposits they could create a loan of $ 333.00.This is how the housing bubble was created.Prof William K Black said that 90% of these loans were fraudulant and no one has been charged.

Perhaps you could explain how the US Federal Reserve creates its money?

*This meant that for every dollar of deposits they could create a loan of $ 333.00.*

No it does not, Arjay and this is where you remain confused. Banks
need to hold reserves in relation to the amount of loans issued.
It equates to around 10%, under Basel 3. Clearly Fannie and Freddie
were nowhere near that. Banks still have to borrow money to lend it
out again. This notion that they can just accept 1$ in deposits and
then lend out 333$, is what you still don't understand and have so
wrong. We can take stubborn donkeys to water, but we can't make
you have a drink. So continue living in dreamworld.

"Accounting procedures", Arjay?

>>Pericles,you think that you can confuse people with accounting porcedures<<

The number of questions that you have failed to answer is beginning to mount up, isn't it. And they all relate to the crazy accusations that you keep making, not to any "accounting procedures". Let's see if I can do a quick recap.

"...show us how you "create money debt free to equal our increases in productivity and inflation", and how you "create money from nothing to equal our increases in productivity and inflation".

You have employed those phrases so many times, you must have some idea what you mean by them. It is about time you shared an explanation with us. Otherwise, I shall simply call you on it every time it appears. Which would be tedious for you, but fun for me.

You could also let us know what you understand by "off balance sheet transactions", as they apply to the Fed. Here is your claim:

>>Ron Paul found that the US Federal Reserve in 2008 created an additional $16 trillion in off balance sheet transactions<<

Just a few examples would do, just to let us know that you understand the words you bandy around so freely.

And a couple of words also on the derivative market, too, would help us understand why you believe that its existence poses such a threat to the world economy.

Now you add further weight to the popular theory that "Arjay speaks from his fundamental orifice", with this little beauty:

"Fannie May and Freddie Mack had leverage of 333:1.This meant that for every dollar of deposits they could create a loan of $ 333.00"

(I love the precision of the ".00", by the way. A nice touch)

I've had a look through some historical quarterly (10Q) reports of FNMA, and can find no evidence of this "leverage" of which you speak... here's the latest for you to look through. Perhaps you could let us know where you found your numbers...?

http://www.fanniemae.com/resources/file/ir/pdf/quarterly-annual-results/2012/q22012.pdf

D'you know, I somehow doubt that you can.

Admit it, Arjay. You haven't a clue, have you.

This was not the case with Fannie and Freddie.Pericles tell where the money for the derivatives of $15 trillion which our private banking system holds,came from.How can our banks be worth 14 times our GDP?

It is at this point, Arjay, that someone should take you gently aside and impart the age-old wisdom: when you are in a hole, it is best to stop digging.

>>This was not the case with Fannie and Freddie...<<

What exactly "was not the case", pray tell? I gave you the URL of Fannie's latest 10Q, which speaks plainly enough. Which part do you disagree with... no, don't tell me - you haven't actually bothered to read it, have you.

But that is as nothing, compared to this load of codswallop:

>>Pericles tell where the money for the derivatives of $15 trillion which our private banking system holds,came from<<

Good Grief. Have I laboured in vain?

To suggest for one moment that $15 trillion of derivatives require $15 trillion in actual dollar bills, demonstrates the most fundamental ignorance of what a derivative is, or how it is accounted for. I have attempted to introduce you to the concept on so many occasions, I am profoundly disappointed that you continue to make the most elementary mistakes.

Would it be easier for you in a different language, perhaps?

>>How can our banks be worth 14 times our GDP?<<

They are not.

Look, maybe we would have a more constructive conversation discussing the complete absence of any evidence for the 9/11 conspiracy that is so dear to your heart. For example, we never did work out how many people it took to plant all those explosives, did we?

But please, Arjay, do us all a favour and stop crapping on about financial stuff that you don't understand, have never understood, and - as far as I can tell - are totally incapable of ever understanding.

It will only get more embarrassing for you, as the sheer depth of your lack of knowledge becomes increasingly apparent.

Have a great day.