A NEW friend completely bedazzled me with a standard magic trick recently.
I innocently picked my card. He led me to believe he was on the wrong track and then a couple of slick moves later pulled out my ten of clubs. I still have no idea how this is done but applauded rather than reprimanded him for tricking me.
There are some tricks I don’t take to so easily however – the ‘magic’ tricks done on a daily basis by the banks.
You see, there are two main differences. Banks, unlike my friend, don’t tell you in advance they are tricking you. Also, unlike a card trick, underhand tactics used by banks do actually affect our lives. Infact they can rule them….
It has taken me all but 57 years of my life to realise some carefully concealed truths.
Banks don’t ‘lend’ money. Never.
Instead ‘they’ borrow from ‘us’. Honestly!
Two total bombshells there but, if you do your research, you will find both statements are correct.
Say you decide you want to buy a house valued at £200,000. You’ve somehow managed to save £50k and want to ‘borrow’ the remaining £150k from the bank. In other words, you want to take out a mortgage (fact the word means ‘death grip’ is a clue there could be a catch).
You have a meeting at the bank, the deal is agreed and you are given forms to sign.
Here’s where it gets a bit ‘tricky’.
You will find your name is printed in CAPITAL LETTERS. This may seem insignificant enough. Perhaps they want to make absolutely sure they’ve got the right victim!
But, no, it’s much more significant than that.
When you add your signature to your name in capital letters – your fictitious legal identity or ‘strawman’ as it is known – you are giving the bank a very important permission.
They are now legally able to access your bond – which 90 odd per cent of people have no earthy clue exists – created through your birth certificate.
Unknown to the vast majority, you and I have been set up as collateral to the banks. This means they can trade our potential economic value without ever consulting us.
Now you’ll be pleased to know your value is far, far more than £150k – more than enough to provide security for the property you wish to buy – but the bad news is – you’re never going to see any of that money yourself, of course.
So the bank, through your signature on the mortgage or other loan forms, purchases a security for the transaction.
They are then able to put £150k as an ‘asset’ in their positive accounting column and print in the same figure into an account with your name on it.
Notice I didn’t say ‘transfer’ or ‘lend’ any ‘money’ because that’s not what has just happened.
You can’t transfer or lend something that never existed in the first place.
Despite this, for the next 25 years or possibly more, you will then work every hour possible to try to get that digital ‘credit’ written off.
Should you fail, the bank, who never had any say in the property before you took an interest in it, will take ownership and make still more capital out of your ignorance.
Now remember here how little right they have to do such a thing when they haven’t given you anything in the first place – merely theoretically monetised a bond that should belong to you and sent it back to you.
To make it even harder for you and stack the odds in their favour, they will also charge you interest – without having to pay any interest themselves on the financial ‘asset’ you have handed to them.
So, in conclusion, it is, after all, the banks that do the ‘borrowing’ not the customers.
And they don’t ‘lend’ you anything. They just set in motion a financial time bomb that is ticking over your anxious head for the best years of your life.