Banks “ACCEPT” Loans As “DEPOSITS” Of Money
The “ONLY” thing banks loan to any transaction is their “NAME”
"Show Me The Money"
People are mislead as to what money is and where the money comes
from to fund a bank loan check. Most people incorrectly think that money is
only cash and that other depositors funded the bank loan check. Everyone
agrees the borrower should repay the lender. We all agree we should repay
the one who funded the loan. The problem is that most people are mislead as to
who funded the loan.
In America, money is more than just cash. Money is anything that
has value and can be sold for cash and is accepted as money. If you use gold to
buy a car, the gold is used as money. If you have $10,000 of government bonds
that can be sold for $10,000 of cash and you use the bonds to buy a $10,000
car, you used the bonds as money.
Banks routinely accept bonds as money and deposit the bonds into
checking accounts. If the bank accepted $5,000 of bonds from you, deposited the
bonds into your checking account, and loaned the $5,000 to a borrower, the
borrower should repay the bank, and the bank should return the $5,000 to you. A
bond is a fancy name for a promissory note (a promise to pay).
If you ask for a $10,000 bank loan, the banker has you sign a
$10,000 promissory note. Did you ever give consent to (authorize) the
bank to sell your promissory note to investors for $10,000. (When most
people want to sell their homes they locate a real estate agent. The
homeowner signs an agreement with the real estate agent giving the real estate
agent consent to sell the home. Once the home is sold the homeowner receives
the amount the home sold for, the real estate agent receives a commission
(percentage of the amount the home sold for). The real estate agent is not
entitled to keep the full amount of what the home sold for.) The investors want
the interest. If you do not pay the interest, the bank forecloses and collects
the money? Both the bond and the note can be sold for cash giving them equal
value to cash. Actually the bank has no "STANDING!" No
"STANDING" to sue, foreclose, or claim your deposit as theirs. When
the bank "accepts" your loan (deposit) they must now act in
"good faith" as "trustee" with a "fiduciary duty"
for your benefit "ONLY!"
According to Federal Reserve Bank publications, the promissory
note that you signed is money.
When banks deposit the borrower's promissory note into a checking
account, the bank accepted the promissory note as money. If you deposit money
at the bank, it is like loaning the bank the money. If you deposit it or loan
the bank the money, you can get the money back.
If you travel to Brazil, you will go to a moneychanger to exchange
equal value of American money for Brazilian money. If you exchange $100 of
coins for $100 of cash, you traded value for value. An exchange is not a loan.
If you deposit $100 of cash and withdraw a $100 check, that is
a return of your original loan (deposit).
If you loan (deposit) $100 of cash to the bank the bank
has to return the $100 on your demand. The bank makes two entries onto
their ledger with each and every deposit they receive, double entry
bookkeeping. The first entry is the asset side of the ledger for $100, the
second entry is the liability side of the ledger for $100. With every new
deposit the assets of the bank increase. With every withdrawal those same
assets of the bank decrease. If you loan the bank a $1,000 bond or promissory
note that can be sold for $1,000 cash and this loan funds the bank loan check
back to you, the bank has to return your original loan (deposit)
RETURN defined: To bring, carry, or send back; to place in the
custody of; to restore; to re-deliver. "Return" means that something
which has had a prior existence will be brought or sent back. Sims v. Western
Steel Co., C.A. Utah, 551 F.2d 811, 820. Black’s Law Dictionary Sixth Edition
(page 1318)
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