The Fed’s Dangerous Path to Further Secrecy (Uncut) 02-27-2025

we live in a fantasy world now reality has been destroyed this is the time that we really need to pay attention the probabilities are overwhelmingly on Gold’s side that is the best environment to see gold increase its value welcome to Palisades Gold radio I’m your host Tom bodik joining me today is John Titus creator of the best evidence YouTube channel and substack and co-host of a weekly podcast with Katherine Austin Fitz over at solari.com John thanks for joining me today it’s good to see you again Tom it’s been a

while it has I I always say that and it always blows my mind you know how long it’s been between times that I speak to all of my guests and of course you know the last time that you and I spoke you laid out how you predicted the banking crisis that we saw in March of of 2023 which feels like an eternity ago already so I I wanted to kind of start with reviewing that a little bit did that problem go away or has it been kicked down the road as well with many of these other issues that we’re going to talk

about today there there’s there’s two different issues bundled in uh the the bank failure of Silicon Valley Bank and others in March of 2023 the prediction was I based that on which I did three weeks in advance I did a video called why is the Federal Reserve provoking a financial crisis where I said you can look at the the P patter of Bank borrowing Commercial Bank borrowing and you can see they’re Panic borrowing right now and every time they Panic borrow from an entity called the federal home loan board you get a banking crisis

so the banking crisis is here the banking crisis is now and then three weeks later Silicon Valley Bank fails and it’s we’re off and running I did a second video called Deep diving the feds killer whale crisis that look back at that bank crisis right after it happened to Tred to forensically piece together what was going on and it was pretty obvious um from Senate testimony what adapted Silicon Valley Bank and others is you have these massive Bank deposits just walk out your door and the bank goes down and that’s

what happened to Silicon Valley Bank and Silicon Valley Bank but you know what was so kinky about that crisis is these are these are wealthy Banks it was precisely because the banks had massive deposits leave the door that caused the crisis so and and that was a direct result the massive deposits and by Massive deposits we’re talking about on the order of $1 billion and what’s you know the weird thing about a$1 billion dollar deposit is you know who on Earth keeps a billion dollars on deposit at the bank because

it’s uninsured right you’re insured up to $250,000 so if you have a billion dollars essentially 100% of that money is exposed to risk but people were keeping that those deposits in that volume on deposit at these Banks and when they left the banks collapsed that’s what happened to Silicon Valley Bank the point of the the Deep diving video was that what created those massive deposits was the fed’s quantitative easing program during the pandemic specifically in the early part of the pandemic say in the first six

months starting in March of 2020 the FED went out and bought you know ultimately It ultimately purchased 45 trillon of assets but it bought those assets from non-banks and that caused your deposit base in the US to swell to expand by $4.5 trillion doar which was a big deal because they started at 13.5 trillion in commercial deposits so the FED its quantitative easing program during pandemic caused Commercial Banking deposits in the United States to swell up by a third that’s where your inflation came from and that’s where

your crisis came from and I lay that out in deep diving it’s one of the best videos I’ve made there’s no question that the Fed was behind that crisis no doubt about that at all well I know at the time we were quite worried about you know that problem manifesting again so again has that has that problem been kicked down the road or has it has it really been solved or or is it that you know people realize that having a billion dollars in a bank is a risk instead of let’s say keeping it in short-term treasuries or

something like that I I think my best guess is that the problem has been kicked down the road because I’m looking right now at a graph of deposits in commercial Banks and you know it right now it’s it’s sitting at um I you know the Fred St Louis fed they changed their the way they did their graphs and they’re terrible now so it’s it’s much more cumbersome website to work with as it was before but but basically Bank deposits right now are sitting at18 trillion dollar you know I I just told you that in March of 2020

they were 13 and a half trilon so that the expansion hasn’t gone away the last time you and I talked was say March of oh I can see it because I can see where the failure is when you and I last talked uh Bank deposits were 17.3 trillion so the problem hasn’t gone away it’s been kicked down the road you still have massive depositors out there so the problem could rear its head anytime when you get these guys like Peter teal and these Silicon Valley guys they get together and they decide to yank their

deposits in volume like that out of a bank the bank’s going down right and nothing like that ever happened in the global financial crisis because there weren’t deposit of size so you you had like Washington Mutual went down but we’re talking about you know6 billion in deposits leaving the bank over the course of of weeks and with Silicon Valley Bank it was like you know 14 billion on deposits leaving in six hours yeah that’s a that’s a m that’s the difference between you nicking your thumb on the one hand and losing your

right arm on the other hand you know one’s going to cause you to die and one’s not right Washington M had a lot of other problems up to it including fraud but that’s so that’s a different story anyway this is the fed’s banking that Silicon Valley Bank is the fed’s it’s the fed’s responsibility they did that John do you have any explanation for why these guys would hold so much cash in a bank as you said basically uninsured versus as I was kind of thinking about let’s say holding it in a in a short-term treasury to make a

little bit of interest on yeah that’s that’s um this guy this guy Joseph Wang you know him I’ve interviewed he wrote a book called Central Banking 101 um it’s good book and you read it it’s like yeah well if you have a lot of money a billion dollars you put it in you put it in treasuries because treasuries don’t need insurance it’s it’s the US government I mean if the government fails you’ve got you’ve got other problems in your hands okay the last you’re you’re not worried about money at that point you’ve got you’ve got other

issues so you put you put large volume money in in short-term treasuries and you know you stagger them you bu short-term treasuries and you buy you buy one every whatever six weeks and you roll them over you know there’s all sorts of games you can play to sort of keep your cash flow going and keep yourself so you can liquidate when you need to liquidate and that’s what you do why people keep keep $1 billion dollar on account and I I can think of no other reason than they want to take the bank down I mean in fact in the video deep

diving the feds killer whale crisis I cite two examples from history of people keeping large volume deposits one of which is Bernie maid off kept $5.6 billion at JP Morgan Chase that’s not a particularly shining example the other example I found was from um a book called corporate money versus US currency by um ald not aldrid by by a guy named Alfred Owen kroer and kroer sites an example of somebody keeping large deposits on at a bank for the purpose of having leverage over that bank and being able to take eventually

take ownership of the bank in other words what I’m telling you is there’s no good reason there’s no non- nefarious reason to keep massive amounts of money on deposited at the bank precisely because you can get you can lose that money it’s exposed to risk so you obviously you have some reason other than risk since you’re taking on risk you you have some other reason other than safety to do that and I’ve never seen a decent explanation for what went on with silic and Valley Bank and the others it’s just like well we don’t

want to talk about that no one wants to talk about it I want to talk about it I want why why are these criminals holding huge amounts of money in Banks you know you think it’s a good idea for an FBI informant like Peter teal to hold a billion dollars at the bank I don’t I think it ought to be looked into but oh God we can’t do that well I think there’s plenty of those situations throughout throughout let’s say the last five years that need to be looked into but that will just be you know forgotten about because it’s

inconvenient let’s say yeah right right so that’s where we are it it really hasn’t gone away from what I can tell from the grass now that said Tom I have not gone in and looked at bank by Bank call reports like I did with those two videos um recently I I haven’t done that since I did deep diving the FED Skiller whale crisis two years ago basically almost two years ago con I’d like to move to a different topic that you know is very much on a lot of people’s minds over and above you know this seemingly NeverEnding news

cycle that we have right now and that’s talking about the fed’s federal debt right now do you think that the FED has thought about and let’s say laid out a plan to deal with the large fiscal deficits and and Regulatory Capital constraints in order to be able to back stop the treasury market liquidity if that becomes a problem not really not not officially I me just put it that way not officially if if you look at official fed pronouncements they’ve been saying and the treasury has been saying for at

least three years maybe maybe more that the United States is on a fiscally unsustainable path and then what we need what we need to do about it is we need to start ring in deficits so that they’re a smaller percent of GDP what and what they mean by that is austerity in other words they’re blaming us for the problem um unofficially you have policy papers that have that have been floated saying you know big big deficits and big debt like that presents a problem just sort of a logistics problem um with the

treasury market because primary dealers are only so big they can only handle so much volume and eventually you’re going to need the fed’s going to need to buy treasuries directly which right now I I I don’t think is legal I think there’s there’s some prohibition some legal prohibition for the FED to buy treasuries I don’t think it’s not allowed to do that right now and I’ve seen like policy papers and proposals saying you know you’re going to need to relax that and um don’t worry about it it’s it’s not a problem because

the interest payments on the debt at that point would because the FED is is statutorily obligated to turn over the vast majority of its profits back to the treasury the huge interest payments would be recycled back in into the US government that’s the idea like it’s floated as that’s a solution to the problem um down the road it never addresses you know whole the problem of the system is you’re creating all of your money is created as debt with an interest rate attached to it it’s not it doesn’t address that it

just you know it’s like well we just going to reroute the plumbing okay well originally how was the FED set up with let’s say these intermediaries between it and the government and what was the purpose of these intermediaries well if if you look at testimony from the from the 40s I I think actually Mariner Eckles um whose name adorns the Federal Reserve building in Washington DC Mariner eeko testified quite bluntly in the 40s that the purpose of the primary dealer system was just a sop to Wall Street just to interpose Wall Street

between the Federal Reserve and the treasury it’s bit like a mosquito with a with a blood funnel into the neck of the country just sucking out money this is the former fed chairman saying and a renowned former fed chairman Marin Eckles is you know he’s Hall of Fame he’s in the pantheon of monetary history saying yeah well the purpose of the primary deal system to stop the Wall Street it’s the only real reason for it so is the current let’s say situation with the debt that we’re facing is that the same idea of fiscal dominance that

was initially presented by Charles Cirus Cirus I I don’t I don’t I don’t know um I know that when you when you’re issuing you got to finance your your money like that and you have a debt-based monetary system you know who who you know let’s look look at it this way Financial assets Global Financial assets you know most of Global Financial assets Global are treasuries you know some something like 60% of financial assets are Deni dominated in US Dollars and a big reason for that is that debt is created as

money so this Federal Reserve System that that’s it’s it that’s its gas that’s that’s what drives it so more debt is more power so let’s issue more debt let’s have more Wars let’s have more you know boondoggle projects because the more debt we we create the the more interest we rake in so I don’t know what I didn’t read the calaris paper or I know who you’re talking about I always think of calamari when I see the guy’s name but I I don’t I don’t know the paper well it’s basically this idea that

you’re going to have to start issuing so much debt just to be able to service the interest payments and that cycle just basically taking off and continuing into you know basically a debt and inflationary spiral yeah um I don’t it could that that one could go either way actually um and let’s let’s talk about the spiral first and then we’ll talk about the effects of it the spiral you’re talking about um this just look at it from our personal point of view let’s say that um your income it’s just you know to use round numbers your

income is $1,000 a month and you got to make you’ve got to make debt payments and you’ve got to make interest payments on the debt you’ve got you take out more and more and more credit card debt and eventually you get to a point where the interest payment or the minimum payment on your credit card is more than your income okay at that point it’s over you know when you’re when you’re borrow money to pay the interest it’s over I don’t know if you’ve ever hung out at you know off trck betting places but that that’s how

guys that you see the guys walking around their hands all gnarled and they got a limp and stuff they were borrow money to make to make the juice you know to pay to pay The Vig um and that that’s what H that’s a that’s a bad because you’re physically unsustainable at that point so if the rest of the world sees the US borrowing money to make the interest payment that’s that’s not good that that’s that’s a that’s a problem um but what is that so what do you do with that if if no one’s because no one

at that point is going to buy your debt I wouldn’t think let about the interest payment though there’s there’s really two different ways to look at interest payments one is just what’s the interest on the debt you got to pay that and the second way is well it might be it might be a little bit bigger the real the real interest payment is a little bigger than just the percent on the debt the real in interest payment is that that component plus some other stuff that is really non-negotiable Social Security payments

Medicare payments Medicaid those things because those payments are they’re they’re not legally contractual but they’re socially contractual in that sort of the deal in the US is when you’re young and you’re healthy and you’re paying into the system you know you you pay into the system we kind of we kind of tax you for that but when you’re older the benefit is the reason you’re paying into the system is that when you’re older and you you’re not making as much money and you’re not as healthy we’ll we’ll give

you some pay we’ll give you your payments back then we’ll give you a little bit of income to live on form of Social Security Medicare Medicaid to take care of you as your health begins to decline those are those are social contract payments that everybody expects them I mean there’s not a politician in the world who’s going to get up in front of a microphone go you know what we’re going to cut your Social Security payment in half you no one you better you better wear a bulletproof vest if you’re going to say something like

that and that was something that Luke grman pointed out um that that it there’s more to interest payment than than just the mathematical calculation so the interest payment the real interest payment the non-negotiable part of the the debt and a deficit is is bigger then you might it might first appear but the way to handle that would be you know you you could handle it if you sto borrowing your money into existence if you issued money to retire the debt so the debt now is what 30 35 trillion ballpark I think

yeah 35 37 somewhere in there okay well you know what you could you could pay that if you if you issued if the US government if Congress because it it’s constitutionally charged with coining money and it’s charged with you know issuing credit on the name of the United States but it just could coin money they the Congress could issue legal tender and retire that debt now it would it would probably be verely inflationary to do that um maybe but the debt the debt could be wiped away it’s not it’s not the incable

problem that as it’s pitched it’s pitched as this problem oh my God we’re borrowing too much money but the but they they’re never going to do that because the debt-based monetary system benefits the people in power the private Anonymous trillionaires who are in power they’re never going to stand for that because they have total control over the country they’re not going to stand for that and so we’re in the spiral of more and more debt more and more austerity that’s that’s the bottom line going back to I think it was let’s

say in 2021 I think it was there was this idea Flo about saying that they were going to possibly issue two Platinum coins worth of trillion dollars a piece is that the same kind of idea that they they would have this ability to extinguish that debt the treasury legally has that option yes yes now you’d have to think it through right um because your your debt holders are a lot of different you know the different countries different people it’s going to have long-term effects but the reason they’re not going to do that

is they’re not going to ever abandon the debt-based monetary system not until there’s public pressure to do that and there’s not public pressure to do that because the the powers that be are they they have genius ways for comp convincing different people of different political Stripes to go along with the debt-based monetary system even without knowing that that’s what they’re really doing so you have you know on the left they pitch mmt modern monetary Theory that’s picks the lefties oh debt thatb

that’s how you do it debt is money money is debt no it’s not and then for the people on the right it’s like well we we want to pitch a libert ISM and gold back money and all the rest it’s like well what you really mean is gold back debt you wouldn’t need any gold if it weren’t any debt but you gota you gota you got to prop that debt up as it looks good because it’s back it’s powerful it’s back by gold but that you’re buying into the you’re buying into the debt based monetary system when you do that the Romans figured out eventually

that was really wasn’t the metal that was giving the coins or value it was really it was really the seal of the government that gives the coins their value and and I tell you who else figured it out in 1694 was the bank of England but ironically they’re the ones who introduced the debt-based monetary system at the wholesale Central Bank level back in the day and we never look back sadly in other words when when the bank of England got started you know I’m going to talk about this in in the series I’m I’m doing

right now when the bank of England started in 1694 England you know England had been out of the money issuing business for 30 years and was borrowing its money from you know basically private Bankers the bank of England comes along and says hey you know we noticed they formed the bank of England um and England needed to borrow a million pounds um England could have issued that money they could have gone to Parliament and said you know pass the law we issue a million pounds but they didn’t do that

they had the bank of England print up a million pounds of notes let’s say 10,000 100b notes in England the country borrowed these notes with ink on them from the bank of England Corporation at 10% interest idiotic they could have just printed the money if you you you know just print if you’re GNA print money print money you know if you’re GNA print money if you want to print a million pounds print a million pounds but don’t don’t have someone else print a million pounds and you borrow it from it are you

are you a total idiot but that’s what went on it was the biggest scam ever that’s that’s Central Bank that’s where the Central Banking scam that’s where and when it got started going back to this idea of not necessarily needing gold unless you have debt do you think that that’s why let’s say so many of these central banks around the world especially the eastern central banks are stacking so much gold right now is because of the debt that they have accumulated because of the debt they’ve accumulated I I I kind of doubt it okay

the the countries the countries that seem to be stacking gold you know and don’t get me wrong listen I’m I’m personally a fan of precious metals particularly silver I I you know I I think it’s it’s you got to have that you have to have silver gold personally but just on a on a monetary Sovereign level you don’t you don’t need it but the countries that are stacking the gold are they tend to be producer countries with with who run surpluses and I I think that you know they’re they’re doing that because the

world is so conditioned to thinking hey that’s a solid currency and you know there’s something to that I mean if you’ve how much gold do you really think is that New York fed or Fort KNX or wherever probably not that much I if I had to guess so the the the countries that are buying it up you know they that’s that’s a show of strength that it’s very psychological it’s it’s it’s a show of strength and it’s a show of viability of their currencies I that’s my best read on that I I don’t I can’t read their minds but I that’s that tends

to be a pretty if if if if you’re inclined to doubt a foreign currency on the one hand and then you find out well wait a minute they they’ve got it’s backed by a lot of gold that that’s a viable country if that’s if they really in fact have the gold stores that they talk about and so it would tend to produce the faith that you want in the currency to get people to at least dip their toe in the water but I I don’t know that’s that’s my that’s speculation on my part so getting back to this idea of

what’s actually happening right now with the let’s say the specifically the US debt if rates keep going up right now in the bond market does this present a bigger problem for the FED considering how much debt has to be rolled over this year yeah yeah it’s that’s a that’s a major problem because you’re you’re running up against you know the guy with the broken fingers at the at the OTB is like well you’re you’re now you’re you mean what what are tax receipts tax receipts in the us or on the order of

$55 trillion you your rates keep going up your interest payments are going to creep up I think they’re over they’re pushing a trillion dollars right now I mean you’re you’re in you’re not there yet but but the but in the foreseeable future yeah your your interest payments could get out of control when then you then you you have to pay more in interest then you’re collecting in tax receipts then You’ got then you’ve got problems you have to do something at that point point because no one’s going

to take your no one’s going to take any new debt because they know you’re not viable so I want to get back to this idea of let’s say the the mechanisms here as well what problem does the the treasury dealers having large inventory present to the Treasury System the same problem a snake has when it eats a goat I mean it’s got It’s got a process this huge thing moving to its body that’s essentially there was a paper floated at um a recent Jackson Hall conference I think by by Mark Duffy not mark it was

somebody else Duffy Mark Duffy I know dude named Mark Duffy um anyway and he said yeah they they can only handle so much volume and he had some Metric for it to figure out how much volume they could have and he’s basically like listen sounding the alarm like there’s there’s could reach a point in time where the primary dealers can’t handle the debt volume they they just can’t Pro they’re like the snake with the goat they can’t the goat got too big you know you can’t a 20 lb snake cannot eat a 300 lb goat it’s not going to

happen um and not not not to survive the experience anyway so there’s different things to do and so I think Duffy’s paper was proposing well eventually you have to have the FED buy the debt of the of the of the government and and under the debt based monetary system that’s not an unreasonable conclusion but it begs the questions like back to the bank of England example it’s like well if you can if you can print the money why would you why would you delegate the job of printing the money to someone else and then borrow the

paper that’s that’s moronic you in other words back to the million pound example with the bank of England when when the bank of England printed out the million pounds of notes in lenet to England you know the interest payment on that that’s at 10% after a year is £100,000 that 100,000s is pure Usery it’s pure Usery there that something for nothing the bank of England didn’t do anything all they they sprayed some ink on paper that’s it that’s worth the $100,000 the the England could have said you know what go ahead and print the

notes and to pay to pay the bankers for this wonderful service of putting ink on paper they could have said you know what that that’s a wonderful print job why don’t you peel a few notes off the top and put it in your pocket but what you shouldn’t do is pay interest on paper that someone else printed that’s you know I don’t want to use the RW but that’s really really dumb there anyway so same with the Fed so the Duffy paper it’s like well if you’re gonna if you’re gonna have the fed you know buy buy the debt directly

from the treasury maybe maybe we should have the treasury just print the money itself and cut the middleman out without any interest pay what do you think of that oh no we can’t do that no the finance and E economics profession is designed to service the fed and they’re not going to hear of that and probably to OB obfuscate that fact as well yeah of course of course I mean the whole profession set up with you know the Arcane terminology it sounds very scientific it’s all designed it’s a rubbe Goldberg system to hide that scam

at the root of it which is issuing debt-based money in other words there there is no there is no Bank of England without England there is no fed without the US government the Fed was created in 1913 the US government existed hundreds of years before that you know no one the founders knew better than the trusted Central Bank the founders of the US did not trust central banks there was a central bank when the Constitution was signed in 1787 right the central bank had been around the Bank of North America had

been around since 1781 did you see the founders giving any power any monetary power to the central bank back then no they gave it to Congress they didn’t trust Central bankers and we shouldn’t trust Central Bankers so why why are you issuing debt-based money I don’t I don’t get it so if the FED takes that that money directly does that end up being you know highly inflationary if the dealers can’t take it I I thought so but I the more I think about it it’s like I I don’t I don’t think so um because of that feedback loop

they’re paying that money back into the system the a a the interest payment goes right back into the confence of the US government and B what what created the inflation during the pandemic was was buying the assets from the non-banks which had the effect of of bloating the commercial deposit base from 133.5 trillion to 18 trillion that that’s where your inflation came from even though again nobody talks about that oh okay talk about that the only two people I’ve ever seen talk about it are me and

mvin King for head of the bank of England um so I I don’t see that if the FED is buying like you say if that’s the solution for the FED to buy debt directly from the treasury I I don’t I don’t see that that necessarily inflates Commercial Bank deposits because you got to remember let me take a step back in in a debt based monetary system and throughout the west and really throughout the world it’s a two- tiered system you have a wholesale level and you have a retail level the inflation comes from the retail level the retail

level is basically commercial deposits plus cash but cash is a little it’s a little confusing because it comes directly from the wholesale entity comes from the FED but the inflation comes from the deposit base inflating up wildly like it did in 2020 that’s that’s where that came from the wholesale level you know look at what happened in the wake of the global financial crisis the FED printed money then too but it bought assets from Banks and that’s that’s a that’s a wholesale player to wholesale

player transaction in other words the FED would print up for example a billion dollars in deposits at the wholesale level and go to some you know poor Bank like City group and say well okay what we’re going to do is we’re we’re going to credit your deposit account City group that you have on account with the New York fed we’re going to add a billion dollars to that account um which is a liability to us but we’re going to take your billion dollar asset that’s a purely wholesale transaction there’s no inflation of

retail deposits and thus there was no inflation in the wake of the global financial crisis when the FED used the original QE to bail the banks out okay so QE during the global financial crisis was fundamentally different than QE during the pandemic where it wasn’t Banks involved it was the FED buying assets from non-banks and that because of that the FED did have to inflate they had no choice but to pay people by adding money to their bank accounts that’s how that worked so the notion that that people have floated like well

the FED could buy treasuries directly from the US Treasury I I don’t see how that would necessarily result in in in a greater deposit base and thus I don’t think I I did a video on it and I it’s like H I might have gotten that one wrong I to I might have to do a redo on that one because I don’t think I don’t think it would be ultimately inflationary yeah it’s such a it’s always such a complicated puzzle to try to figure out and it it seems to never end it is it’s very it’s very difficult and it’s

deliberately confusing you know the and and you know frankly you know part part of the problem is when when I study these things and look at them I I got there’s a lot of unlearning that has to go on because I’m bringing in assumptions and bringing in knowledge that I’ve had with me for 50 plus years that’s not correct like the piggy bank model of money is wrong that’s not how the system works you know when you wire in the terminology too like the other day I wired somebody some money okay it’s not really it’s not

there’s not really a wire going from my deposit account to their account that’s what it sounds like right my account got drained $100 and they got 100 added it’s not how that works at all at all the the what happens is $100 gets deleted out of my checking account and $100 gets created at the other end the only transfer the only real transfer is a transfer of $100 in reserves meaning Bank deposits at the fed from the banks from One bank to the other bank that’s that’s so the the terminology and the two-tiered system is

completely invisible to most people but you have to know it to figure out what’s going on and like you say it is it does your head in it’s confusing mhm John what are some ways out of this you know looming debt scenario um we need to get on Congress and start putting pressure back on Congress you know Congress um when the when the people are interested in monetary issues you tend to get a good result or at least not a bad result and I I saw that during the global financial crisis when people were really angry about

bailouts that that Congress paid attention to that they were getting phone calls at a rate of 2001 against the bailout and when the FED then reached in and was bailing out the banks Congress was on top of the FED uh every day like what are you doing with AIG what are you doing with City Group why you know they were they were hauling members of the Federal Reserve in pretty much on a daily basis and they’re in pandemic you know the fed you know the asset purchases were basically three times as large during the pandemic as

they had been during the global financial crisis and Congress didn’t say peep because people were afraid they they were they were like oh my God the V oh my God I think I have this I have a stuffy nose my left nostril I have a horrible disease totally ridiculous they’re scared scared you know you know what and no one was paying attention to what Congress was doing Congress Let It Go and that’s where your inflation came from you have to people the first remedy is you cannot say sit there and think

that all your problems are going to be solved with an app you’re not going to passively sit on your couch playing with an app and get out of this problem you got to get involved you gotta you gotta raise out with Congress they they’ll find a way they’ll believe me Congress will find a way if you you got to you you got to let them know but you know back back when the when the in the FED first flow to the bailout proposal back in September of 2008 calls the congressman they were they were over 100

to1 against and that that’s that’s when Congress pays attention and will do the right thing remember the first time the tar uh legislation came up for a vote Congress voted it down on September 29th 2008 but then there was a high pressure campaign it eventually passed but it goes to show you that when the US people when people get angry enough with with Congress Congress will do the right thing well and I think a big part of that is education not only on congress’s side but also the the population side as

well yeah yeah I mean but what I’m saying what I’m telling you though is there’s no there’s no magical solution there’s no sort of trigonometric treak tweak that you can do with reverse repos or whatever to get out of this mess you know you’re not like I say you’re not going to sit on your couch passively and get out of it but now that said you don’t need a ton of people but you you need a segment of the population that’s just basically knee walk and pissed off with Congress to get them to do the right thing they’ll they’ll find

a way but they’re not g to they’re not going to if if you don’t put the pressure on them they’re not going to do it they’re going to take their donations and they’re going to sail into their golden retirement and you’ll never hear from them again and we’ll be stuck with the problems we have but they’ll only be worse it’ll be 10 times worse John in the fall of 2019 we saw the fed’s reverse repo program see the the repo rate Spike overnight and threaten liquidity for the system and right now I keep seeing the size of this RRP program

has been dwindling rapidly so does this present a larger issue for banks again and in a way where do you think that this this draw down in the system where did that come from or or who did that come from um well the FED is you know they’re deliberately reducing the size of their balance sheet and way and the way they’re doing is with reverse repos that’s that’s where you see the declines in the balance sheet the reverse repos at one time you they were over two Tron and now I had a graph of it up for a minute I

don’t see it anymore now they’re now it’s it’s a lot smaller and it’s it’s Pro approaching zero m so you know reverse repos are on the liability side of the balance sheet right so if it gets to zero where the next where’s the next reduction uh going to come from if it’s not reverse repos let’s say reverse repos decline all the way down to zero how does the balance sheet continue to reduce at that point and the answer is it from the reserve accounts the commercial banks have on account of the FED we call them reserves but they’re

called other deposits if you look at the fed’s h41 report other deposits by institutions that’s coming down and the danger of that is that um if those deposits keep coming down if right right now it’s not an issue because the reserve requirement is 0% remember in March of 2020 one of the you know one of the measures taken in response to the oh my God the virus one one of the responses to that was to reduce the reserve requirement from 10% to 0% where it has remained ever since but you could see you

know it could it could it could go back to 10% it could go higher to 10% and if it goes you know to 10% and you’ve got you know if you’ve got if you got I just told you there’s $18 trillion on deposit by commercial banks at the FED if there’s a temper % reserve requirement that means the total accounts that banks have at the FED has to be at least $1.8 trillion and right now it’s you know what is it it’s 3.2 trillion okay so you you cut that by 1.4 and you’re right there at 10% if there’s a 10% Reserve requirement that that’s

you get what I’m saying that you’re leaving it leaves a lot of power in the fed’s hands if they was a and remember the FED can raise and lower the reserve requirement without Congressional approval they did that they proved that in 2020 when they cut it from 10% to zero well John as As I understood the reverse repo program that basically facilitates overnight lending between Banks to to facilitate as as you kind of used with the with the wire example this this transfer of interbank balances right shortterm liquidity

between Banks yes but if but if that does go let’s say it does go to zero as the as the FED tries to run down their balance sheet does that program cease to have the function of facilitating that interbank liquidity um yeah but it doesn’t it doesn’t it would if it’s zero by definition it wouldn’t facilitate it anymore but it does doesn’t mean that Banks don’t have other ways to find liquidity okay for example they could borrow from federal home loan Banks they do that all the time you know that’s

they in fact when the the banks are the predominant borrower from the federal home loan board originally it was set up I think it as a farm program but like everything else it gets corrupted and becomes in the service of the Big Money Center banks in New York and there it is now so the banks have other ways to get liquidity they might have to pay more for the liquidity but they there’s other there’s other ways they can get liquidity and the fed’s not going to remember the commercial Banks own the

FED right so the biggest two owners of the New York Federal Reserve Bank or JP Morgan Chas and City group so the same the same group of people who own the FED own the commercial Banks the f I don’t think the fed’s going to let the commercial Banks fail and it gets back well what you know so why why the liquidity problem in September of 2019 in the repo market and the answer to that is I don’t know and I don’t think anybody knows I’ve never seen a compelling explanation for what happened there ever I mean if if you know of one

I’d love to see it I just haven’t seen one I’ve seen a lot of yeah this and that and there sunspots that doesn’t cut it Don this brings us to your your new series called the war for Bank ocracy as as you said it’s going to be an eight-part series and you’ve just released the first episode to explain the complexity of Central Bank issues so if anybody remembers back to right after the election Powell stated that he would not leave his post if Trump asked him to and Trump as well said that he wouldn’t ask

Powell to leave either why is that a big deal um it’s a it’s a big deal the the Trump involvement in it is not is not a big deal that’s not not really the issue the issue is that the Biden Administration in May of of last year so may before the election as as b as Biden is starting to stumble and daughter more and more the White House issues a paper that no one seemed to notice called the importance of Central Bank Independence where they said some things in that paper like you know modern countries

modern economies are governed by central banks that are just patly untrue about the us and that memo by the Biden White House did not mention US Constitution did not didn’t didn’t even mention the Federal Reserve Act and it used a lot of language that I found alarming legally um that was very to my way thinking anti-constitutional because it treated the Federal Reserve like every other Central Bank in the world Tre it treated it like the European Central Bank and the Federal Reserve is fundamentally

different from the European Central Bank due to the US Constitution um because the Constitution gives Congress the monetary power The fed’s Authority whatever Authority the FED has it comes under the Federal Reserve Act Congress could repeal the Federal Reserve Act tomorrow if that’s what it wanted so the FED is is different it’s it’s under the heel of Congress that’s different than the ECB the European Central Bank really is independent of those countries the ECB can do whatever it wants and you’ve seen

it do whatever once it shuts off ATM machines and countries that it doesn’t like um they did that with Greece you know the ECB can be really nasty to those countries and it could do so with impunity because it’s independent of those countries it’s fact it’s legally um it’s illegal for the European Central Bank to even accept input from National governments and it’s illegal for National governments in Europe to even try to influence the decision-making body of the ECB that’s the opposite of the US system with with the

Constitution and so I I see that really what’s what’s keeping control of the fed and of the world reserved currency um and and what’s giving us some measure of transparency into the FED with the world world Reserve currency is the US Constitution so I I knew this was going to become an issue um the what the issue of Federal Reserve Independence and what that means and so I started the series I started working on it back in September and I’m I’m putting it out now just to sort of bring people up to speed I don’t know how this

issue is going to manifest between the spiraling debt and everything else but but I can see the powers that be do not like the fact that the FED is constitutionally uh inferior to Congress they don’t like that they don’t the Fed and the central Bankers they hate central control they they do not like that they they are completely opposed to that they think that they are the experts and the best course of action is to is no transparency and just leave them alone and let them can totally control your

currency which is absolute poison that’s not what you want and so I started working on a series because I could see something coming down the road along the lines of a constitutional convention or some other way some other method to amend the Constitution which is don’t do that I’m going to completely argue against that that’s a disaster waiting to happen so I’m trying I tried to get out in front of that with this series and it’s an eight it’s going to be an eight-part series I’ve least one episode um another

one should be coming out Tuesday but anyway that’s that’s a series I’m working on it’s called the war for bank ocracy and it really traces the history of central banks and Central Bank control and how they want to get more more control it really lays it out so that that Biden memo if it’s just a memo does that just let’s say put the ideas out there that the FED needs to have less transparency basically and does that basically set the groundwork and not necessarily make any legal changes to what the FED has to

respect um that’s a good question well let’s let’s start with a threshold question like well why should I care about the Biden memo because we had an election and now Trump’s president the the significance of the memo because it involves the Federal Reserve is it reflects the thinking of the powers that be and frankly I think if you look at you know Trump officials their thinking and really the thinking of the entire finance and economic profession it just would never occur to anybody to question you know fed

officials they all go along with the ultimate program and so the fact that the Biden memo comes out in May of 2024 and says these things it it it it reflects the thinking of the powers that be in the monetary policy circles that’s that’s the problem with it and it It ultimately it does get to when it says you know countries in modern economies are governed by central banks that’s that’s a that statement is wrong as a matter of law us is governed by the Constitution it’s not governed by a central bank it’s not governed by

independent Central Bank Central Bank is is a minion in our system and it should be you know it’s it’s it’s the Federal Reserve is a creature of Congress in 1913 like I say congress could repeal the Federal Reserve Act tomorrow if it wanted so Congress always has total transparency Congress has as much transparency into the FED as it wants because Congress can shut down the FED tomorrow if it wants and get all the documents from the FED that way now courts aren’t going to make Congress go to that link theyd simply order the FED

to turn over the documents so there’s a lot of hand waving going on well the fed’s independent blah blah blah Congress n nonsense Congress can get whatever information that wants from the FED um and I think what I’m seeing with that memo is there’s there’s a movement underway to cut away to cut loose from that system to cut loose from the Constitutional system and that’s dangerous you do not want that to happen John what’s the difference between Central Bank Independence versus Federal Reserve Independence Central Bank Independence

means the central bank doesn’t answer uh to the country so the ECB doesn’t accept input from any of the countries and those countries are prohibited from trying to influence the central bank that’s Central Bank Independence Federal Reserve Independence just means that the Federal Reserve is independent of the executive branch okay it’s it it’s it’s what’s called an independent agency independent agencies are agencies that are set up by Congress and the head of the agency is not a cabinet position

doesn’t answer to the president so the president let’s talk about the president’s cabinet so treasury is a cabinet position um the head of the Department of State is a cabinet position though the head of the um justice department the Attorney General that’s a cabinet position those are the guys in the in the president’s cabinet he can fire them tomorrow if he wants that’s not true of independent agencies independent agencies are set up by Congress and you the the president can’t just go in and start firing people

who head up independent agencies not not legally and if the president does so and it’s challenged doing so you know a firing order really would have no legal effect at the end of the day because the FED just doesn’t I mean the president just doesn’t have that Authority so Federal Reserve just Independence means the that the president can’t fire Jerome poell and you saw that you know pal said in a press conference the day after he was elected he was asked you know are you worried that President Trump could

fire you he was like no they’re like would you leave if he fired you he’s like no and they go to the they go to Trump the next day they say Hey you know Jerome pal said he wouldn’t leave do you are you gonna try to fire Jerome pal and what does Trump say he says no I I don’t see it I’m not going to do it because he knows he knows that it’s you can’t you can’t fire the head of an independent agency and the Federal Reserve is an independent agency it’s a creature of Congress but Federal Reserve Independence the people who are talking

about Federal Reserve Independence who are like pushing like oh Federal Reserve it’s independent it’s independent what they’re trying to do is salt in the notion that the FED is independent of entire government and that’s false that’s false as a matter of us constitutional law yeah because as you go through there’s a relatively simple set of steps that Congress would need to go through Congress and the president would need to go through to get rid of the FED if that was the course that they chose right

yeah majority of the house majority of the Senate votes on a law repealing the fed the president signs it and the fed’s gone it’s that simple majority that’s that’s all you need well John I really look forward to episode two and and the rest of the series as well you put a lot of work into it it’s very highly produced very very striking you know it’s a it’s a lot to dig into but I appreciate that you’ve taken the time to try to explain it to us because you know there’s so many of these things that do ultimately matter

and I think needs to be a big piece of the education of a lot of our society yeah um well I’m glad you liked it the next episode’s going to get into the real source of federal Reserve power the real source of Central Banking power um it’ll be a good episode but I do I do make and I take extra effort and extra steps to really walk through the documents like you know I show the Constitution I show the Federal Reserve Act I show these treaties and say this this is what’s going on I mean it’s not like you know these central

banks there’s a Mystique about central banks as if they existed when someone you know pulled a sword out of a stone in the midst it’s not what they are they’re creatures Al and you got to show the law to know what’s going on and that’s what I try to do absolutely so that’s all going to be available on your YouTube channel the best evidence YouTube channel as well as on your substack and at solari.com right yeah it’ll okay so the series will be available on my best evidence YouTube on Odyssey and on bitshoot I also have

mirror YouTube channels a third the third the the fourth source is sar.com where I put wanted the series because YouTube Odyssey bitshoot substack all these guys they could they could shut me down tomorrow if they want um and I don’t want to put this much work in and would have it go bye-bye so I went to Katherine Austin fits with salary.com and said hey would you be sort of the guarantor of this series where people could go and watch it on your channel and in addition you can download of the documents and download the clips the

Congressional clips that I show in the series for other creators and other researchers to use if that’s what they want to do and she agreed so it’s really sort of an open source project uh with Katherine’s involvement she she’s really backed me on this and I appreciate it excellent well John we look forward to the next couple episodes and I hope you know my audience checks it out as well here thanks um excellent thanks for your time today John really appreciate it yes sir this podcast is for General

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