If you ever played monopoly you may recall having read in the rule book that the bank never runs out of money. Should the bank not have anymore monopoly money they can just make more out with a pen and paper as needed.
In the 1970's president Nixon took the US off the gold standard. That meant the US dollar was no longer backed by gold, but rather our debt, which we repay through taxation. When you hold a dollar bill in your hand you are really holding an IOU. That IOU is the promise of the American people to repay the debt with our taxes.
Since the US dollar is no longer backed by gold the federal reserve can authorize the printing of money without limits, in order to stimulate our economy. Just remember, they authorize the printing, but WE have to pay it back.
Did you know the federal reserve is not a government agency? Its not even an American company. It is a banking cartel made up of some of the richest families in the world. Its their way of controlling who gets rich and who stays poor.
They authorize the printing of US dollars thereby controlling inflation, deflation, and our taxes.
Do you know how they make their money? By charging interest on the money they authorize our banks to print. Money they created out of thin air, backed by our promise to repay it.
Who do they lend money to? They lend money to banks for the purpose of increasing lending, thereby stimulating our economy.
The problem is the banks don't lend out all the money. Although lenders received billions of dollars in bailout money, they decreased lending by more than half.
So where'd the money go? When asked by the NY Times where the money went, all the major lenders, like JP Morgan Chase and AIG, declined to answer. Such headlines were closely followed by new headlines announcing multi-million dollar bonuses for the same banking executives whose bad decisions put us in this mess to begin with.
The reason I'm telling you this is that you need to realize the government isn't here to help you. The more you rely on them the worse off we'll all be. The government is in place to protect the interests of the rich people who put them in office. That's why the president could spend half a billion dollars running for office, a position that pays only $400,000 a year.
The only way out of this mess is to take responsibility for your own future. Start with a better credit rating by removing the inaccurate or unverifiable negative data from your credit report. Stop using your credit cards to make purchases you don't immediately have the money to pay off, unless its for investment purposes, meaning it will make you more money than it costs to purchase it.
Lastly, start teaching your children about money and credit from an early age. Our educational system was designed to create employees. They barely teach our children how to balance a check book, much less a spread sheet. Don't pass on this ignorance to your children. Educate yourself now and pass on the knowledge so your children won't be in a worse position when they take over.
I would highly recommend Robert Kyosaki's "Rich Dad Poor Dad" to start. Robert has a way of simplifying financial terms so that anyone can quickly grasp them. You can find him at your local library or book store. If you're like me and don't have a lot of spare time for reading, then I would recommend downloading the audio book. You can listen to it when you're driving, play it on your mp3 player, or on your computer. Download 2 free audio books online at www.Audio-BooksOnline.com.