Modern seigniorage explained to the mob

Modern seigniorage explained to the mob

Seigniorage is the gain obtained from the privilege of creating money. That's why you are not permitted to do it for yourself.

Here is the explanation from Carlo M. Cipolla on how it works for metal coins:

Now you must adapt this definition to banknotes (treasury notes are forbidden by the banking cartel, and this is why THEY ask to YOU to pay for any tax).

The central bank "mint" the banknotes at the pure costs of the paper and the ink involved, like any other printing business. But it sells the banknotes thus obtained at full face value to the buyers who have to provide collaterals for the FULL face value of the banknotes! A 100 EUR banknote hardly costs more than 30 cent, the difference is the C+S (minting costs + seigniorage). You may ask why the central bank get for herself the seigniorage ? Because they are the SOVEREIGN, didn't you know ? Look at their unique privileges in the bylaws and you will understand the matter very easily. Their seigniorage on banknotes is the 99,7% of the face value compared to the 2 to 10% of the medieval mints on coins.

Now for the public debt and the issuance of commercial bank money.

Make M the "Treasury Bonds" that the state bring to the banking cartel for "minting" purposes. Treasury Bonds carry a discount or interest - a.k.a. usury. And this is the C. The banking cartel, usually 10 to 20 banks called "Primary Dealers", buy the bonds by creating a brand new "deposit account" in the name of the Treasury (Treasury people usually comes from the central bank's insane asylum, as a prerequisite). So here you have the C - that is the interest apparently gained from the bonds, and S - Seigniorage - which is equivalent to the FACE VALUE of the deposit previously created from thin air.

Both deposits and banknotes are accounted as asset, right ? If you are a normal enterprise or an individual, those are cash and real money.

But, lo! and behold: the banks account for THIS money as if this was a LIABILITY, i.e. they discharge the value of the money owned from their profits of the same bank balance shit.

So, first they steal the WHOLE nominal value of the money by getting collaterals in exchange (Treasury Bonds, your house, etc. ) and second, THEY discharge their profits simulating fake liabilities never to be paid out !

And to be sure, whatever it happens you are there to foot the bill.