The Principle of Wealth Creation through Collateralization, Using Other People's Money! Have You Considered Who You Are Or Who You Want To Be On This Chart? Do you understand this chart? If not, I would encourage you to study it again. Let's say you have a $40,000 CD in your local bank earning 4%, and you were thinking of cashing it in to purchase a new auto. This information gets back to your banker, and he gives you a call, and tells you that he will loan you the money @ 6% and if you will leave your CD in his bank at the 4% rate, it will be to your advantage". Should you believe him? No! He is misinformed. You may have a 2% difference in interest, but the truth is you cannot get ahead with this strategy. What if you deposited $1000 in your local bank and they were paying you 2% on your deposit, and your neighbor walks into the bank the same day and borrows $1000 at 8% build a higher fence between his yard and yours? Your bank charges him 8% interest on the loan. What is the spread? Would you guess 6% or 300%? If you guess 300% you would be correct! Yes, your bank is making 300% on the spread, and that does not take into consideration fractional banking, where your bank will use your $1000 as collateral with the Federal Reserve to create $9,000 of additional money out of thin air. Does this add to inflation? Yes! Who benefits the most from inflation? The government! Do you realize that most Americans couldn't write you a check for $3,000 without borrowing the money to save their life? The current Banking system is set up to benefit banks and other financial institutions—not you! This is the reason most Americans are heading toward financial slavery. If you don't plan for your future financial security, Who Will?
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