Richard Cristdahl: Banks creating currency | TheUnion.com
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Richard Cristdahl: Banks creating currency

Analyzing the Wells Fargo scandal, the creation of 3.5 million-plus fake accounts, could be the missing link in how banks create currency in our debt-based economy, where the currency is only created out of debt.

This may surprise most people, but banks create 97 to 98 percent of the currency in the U.S. economy, by creating electronic-currency. Electronic-currencies are loans, credit-card debt, and any created debt that’s stored in a database with no value, and is created out of thin air.

The Federal Reserve in conjunction with our legislature creates the other 2 to 3 percent by printing fiat currency, Federal Reserve Notes, also with no value and created out of thin air, backed by Treasury Bonds (IOU’s). This fiat currency goes into circulation as our spendable cash. The T-bonds create our national debt; electronic-currency creates the American public’s personal debt.



When banks make loans, they create electronic-currency by making a credit entry in their books. To make this work a debit entry has to be created somewhere so their books will balance. I’ve wondered how banks created that second entry to make electronic-currency work, and fake accounts could be the answer.

As a-side-note, it’s mathematically impossible to pay off 97 percent debt with only 3 percent available in spendable currency.




Richard Cristdahl

Nevada City


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