Buying a house

[BlackCat]

Listen to this. I'm not a fan of mortgages because I don't like owing anyone anything but I'm also not a fan of owning something that wouldn't make me money, like a house. Currently I have the majority of my net worth in investments like stock that I don't want to deplete in order to buy a house since those investments are making me money. A house wouldn't make me any money, so the more money I have tied up in investments instead of a house, the better.

I won't go into actual figures but let me just put this into perspective. Let's say I have $50K in investments that are growing at a rate of 15%/year. For the record, I'm a very disciplined investor and do my homework now more than ever before and it's paying off, although I do understand there are risks. Nonetheless, +15%/year is very a conservative figure as I can survive red periods well now (knowing when to buy is just as important as knowing when to sell).

That said, if there's a house out there that costs $50K, why take all that money out from those investments, in effect ending the +15%/year revenue stream, when I could just take out a mortgage on, for instance, $25K of the $50K (a sufficient down payment), meaning $25K is left over in investments which accrue at a rate of 15%/year and just pay a 5% interest/year on the remaining $25K (the loan), netting a positive rate that would otherwise be nonexistent if I paid for the house in full (with investment money) with no mortgage? I know that's a huge run-on sentence.

I think I have this figured out. Feedback?

[Bullet Magnet]

No idea. I just got a job and bought a house, and I'm happy and comfortable.

[BlackCat]

Awesome. When are you having kids?

[Zorro]

When you pull out a mortgage from the bank, those of us who are reasonably financially savvy assume that the bank is using the funds from other depositors to make the loan, and issues that loan with an assumed return on investment (in the form of interest) that gets passed to the original depositors and to the bank's shareholders. Well, that's how it's supposed to work, but sadly, it doesn't work that way. When someone pulls out a mortgage from the bank, the bank itself gets a loan from the Federal Reserve through direct or indirect channels (by the way, the Federal Reserve is a private institution; the only "federal" part about it is the name). The Federal Reserve, with the power granted to it by Congress, literally creates the money for the mortgage out of thin air and then loans the money to the issuing bank with interest. Since the bank understandably needs to profit from the loan, the bank charges you a higher interest rate than the Federal Reserve charges them. Put simply, the bank gets a loan from the Federal Reserve at a specified interest rate, and you get a loan from the bank at an even higher interest rate. So now you know what it means when you hear in the news that the "fed" has raised or lowered interest rates, and how that affects you.

So now let's put this all into perspective with a little hypothetical... Let's pretend that I'm a counterfeiter and that I print money in my basement. Soon, my neighbors find out, but before the cops can come and arrest me, Congress issues legislation that allows me to continue printing counterfeit money. Attached to that legislation are provisions that bar anyone else but me from being able to print counterfeit money, along with provisions that allow me to use my counterfeit money for all debts, both public and private. Well, that's the Federal Reserve. Congress has authorized the Federal Reserve to be able to create and issue money in the form of loans to other banks and to the US Treasury. No one actually knows who owns the Federal Reserve, we just know they're private bankers, and we know that these nameless private bankers can take the interest accrued on the loans they've issued and use it to buy whatever they want.

The Federal Reserve has to be careful with how much money they create out of thin air and issue to the banks and US Treasury, because all of this can only work if the fake money they issue has a perceived value by the populous. Otherwise, the people would return to bartering and would stop using Federal Reserve notes for everyday transactions. So now we come to the Federal Income Tax, which is supposedly authorized by the 16th Amendment. The Federal Reserve Act was passed in 1913. The 16th Amendment was also passed, albeit fraudulently, in 1913. Even though the 16th Amendment is merely an enabling statute that doesn't grant Congress any new taxing authority, most people today make the mistake of thinking that the 16th Amendment authorizes Congress to impose the income tax you see when you fill out your Form 1040 to the IRS. Coincidence? Nope. It's actually quite simple. In 1984, the Grace Commission under President Ronald Reagan stated that "100% of what is collected [in income taxes] is absorbed solely by interest on the Federal Debt and by Federal Government contributions to transfer payments." This means that most of the money collected from personal income tax is used to pay off interest that the government has accrued from Federal Reserve loans. Put simply, the 16th Amendment was fraudulently passed to help prevent hyper-inflation of the incoming Federal Reserve notes (the Federal Reserve act was passed about 10 months after the 16th Amendment). Strangely enough, you will actually find no statute in Title 26 CFR that mandates an income tax on private citizens, nor will you find any statute in Title 26 CFR that makes such citizens liable to pay the tax... This is because Congress has never passed legislation mandating a personal income tax on private citizens. Why? Because the Constitution doesn't allow them to. But that's for another topic...

In order for the Federal Reserve to function, it requires that people and governments get into debt from the loans they issue. The Federal Reserve can only profit from the interest accrued on these loans, and people won't take out loans if the fake currency has no perceived value; that's why the Federal Reserve will adjust interest rates. This means we literally, with no exaggeration, have a debt backed currency instead of a tangible backed currency as mandated by the Constitution. Debt backed currencies will completely collapse if people don't get into debt. So how does all this apply to your post, BlackCat? Well, for me it means that if I was to ever take out a mortgage, I would never attempt to pay it off early, even if I had the cash on hand. Secondly, since the money on my credit card is also created out of thin air by the Federal Reserve, it means that I plan to continue making minimum payments on the credit card debt I've accumulated from medical bills. You can simplify all this even further by saying that you shouldn't get into debt, and if you do because of extenuating circumstances (i.e. medical debt, emergencies, etc.), you should only make the minimum payments necessary on that debt. Such debts are for money that was created out of thin air, and are not sustainable across multiple generations.

[BlackCat]

Thanks for taking the time to explain that, Zorro. You're right. You may be surprised but I already knew most of what you were talking about thanks to watching a 30-minute film on YouTube last year. I'm not sure if you've seen it but I found it very interesting.

[Zorro]

I'm glad you are already aware of this, because more people need to know what's going on! Because the United States Dollar is the world's reserve currency, I believe that the Federal Reserve and Federal Income Tax are the biggest crime in the history of human civilization.

[BlackCat]

It's scary. Americans value federal reserve notes so much that it seems like they don't care to learn about any other asset, ignorant to the idea of what's more valuable.

Case in point:







Of course, there's a possibility of these videos being fake. The ignorance is hard for me to believe but unfortunately, if I had to guess, I think they're real.