IMPORTANT NOTE/DISCLAIMER: The following article is not legal advice and was not written by an attorney. It is merely a collection of common-sense, rational observations written by a sane, rational layperson with common sense. It is recommended that you consult with an attorney for any and all legal advice and/or action.
I happened upon this remarkable video recently, and was blown away by it—here, I thought, is what I have been calling “self-issued currency” in action, and not in some distant utopian future, but right now, in the dirty, smelly, messy present! For those not inclined to watch the video or who may have some problem with Michael Tellinger (the presenter), let me explain Tellinger’s concept in a nutshell.
For starters, Tellinger explains how, using his self-issued promissory notes, he paid off a deficiency judgment related to the foreclosure of some of his property . That is, he lost the property in foreclosure, and the property was sold at the foreclosure auction for less than Tellinger owed on the property, so the bank sued him for the difference. As he correctly points out, this is one of the most despicable things banks do, suing you because the property they’re taking from you didn’t bring in the amount that they “loaned” to you out of thin air when that property was sold out from under you.
Tellinger of course realized that banks create money out of nothing, which is really a shorthand way of saying that banks take your promissory note and sell it back to you in the form of “interest.” And he knew, correctly, that the particular bank that was stealing his property—Standard Bank of South Africa—like all banks, didn’t take any risks in this kind of “loan” transaction and therefore cannot and would not be hurt in any way if he didn’t pay them with money he worked like a dog to earn. So Tellinger did some research and realized that in South Africa, there is a remarkable High Court Rule which states the following, in Tellinger’s paraphrase:
We have it on record from a hearing in the South Gauteng High Court, in the matter between STD Bank vs Tellinger, that the banks accept payment in Bills of Exchange AND Promissory Notes.
According to Tellinger, the attorney for Standard Bank blurted out the above information in a hearing regarding the bank’s suit against Tellinger.
Tellinger then decided to turn the tables on the bank and give them a taste of their own medicine by repaying Standard Bank with his own risk-free, out-of-thin-air promissory notes! And according to Tellinger, it totally worked—he’s paid them roughly $800,000 rand (approx. US $69,000) and the bank has accepted his self-made, self-issued promissory notes as payment!
Here is Tellinger’s fill-in-the-blank promissory note:
How Does This Work? It’s all in the “promise to pay,” i.e., the “IOU”
You will have to watch the video for all the gory details, of which there really aren’t that many, but let me get right down to brass tacks. What Tellinger has done is used the bank’s weakness to his total advantage and that weakness is this: banks don’t deal with or trade in “money,” they deal with and trade in IOUs. Don’t believe me? Here’s the Federal Reserve on the subject of IOUs, from their pamphlet “I Bet You Thought”:
“Commercial banks create checkbook money whenever they grant a loan, simply by adding new deposit dollars to accounts on their books in exchange for a borrower’s IOU.
Money creation bookkeeping isn’t gimmickry. Far from it. Banks are creating money based on a borrower’s promise to repay (the IOU), which, in turn, is often secured or backed by valuable items the borrower owns (collateral).”
That is, most “money” that exists today is created as a “promise to pay” contained within a promissory note, and said notes are just black inkjet ink from desktop printers on generic copy paper from Office Depot. A legal “promise to pay” is indistinguishable in essence from an IOU one might write to a friend or family member in exchange for a loan—in fact, the Federal Reserve itself refers to promissory notes as IOUs, as can be seen in the above quote from “I Bet You Thought.”
Think about it—when you “borrow” money from a bank, you have to sign a promissory note in order to be given the “money,” right? But do you receive that “money” in cash, or even a check made payable to you? No, you don’t. Sure, a check may be written to the entity that will ultimately get the “money” that you are “borrowing,” but no cash or anything with intrinsic value (i.e., gold or silver) will change hands in the transaction—it’s all done strictly on paper. So in a very real sense, you have written an IOU to the bank for the amount of your “loan”—and that IOU is given the more formal-sounding, legal name of “promissory note.” And that IOU/promissory note is then the basis for the bank’s “funding check,” with that check itself being an IOU. It’s pretty clear, then, that banks deal all but exclusively with IOUs (they have to keep some cash around, but only enough to be able to meet expected daily withdrawal demands).
The brilliance of Tellinger’s strategy: feeding the system with liquidity
So why does Tellinger’s strategy seem to be working? Well, look again at his blank promissory note above—it offers to make a $500 payment in the national currency on the 7th day of every month. Tellinger explains in the video that the payments must be physically picked up at the address listed on the note, on the 7th of the month and only on the 7th of the month.
What that means is that the note is actually “worth” the specified amount of the national currency and in fact, the $500 can be had by doing what the note says. That is, Tellinger doesn’t refer to some mystical account in the national treasury that may or may not exist and try to use that as a way to pay the bank. No, he’s offering the national currency to the bank. They just have to come pick it up. Of course, no bank is going to actually send someone out to fetch the money on the appointed day. But they could, if they wanted to. In this way, Tellinger has created what banks love to create and trade–debt. Since it’s debt–it’s like all other “money,” and the banks accept it because they can trade it. As Tellinger says in the video (approx. 10:25):
“…your signature creates [on the self-issued promissory note] the liquidity and the value in that piece of paper [i.e., the promissory note]. So it turns it into a liquid negotiable instrument…with which the bank can trade.”
And that is the brilliance of Tellinger’s self-issued promissory note: it creates liquidity, which is the whole point of the insane system of money and debt that has been built up around us and pervades everything that we do and that we are. It facilitates trade. Again, banks deal in debts/IOUs—that’s their business model. Even cash, as Tellinger points out in the video, is just a bill (of exchange), or a note (even the humble U.S. dollar bill says right at the top that it is a “Federal Reserve NOTE”). In other words, all money is debt, even cash. In the bank’s own system, all debts are paid with…more debt. It sounds (and is) insane, but that’s the current system, and so since the bank knows that ultimately they can only be repaid with debt (again, because all money is debt), the form of debt—cash, note, check–with which one pays them back is more or less irrelevant.
So, according to Tellinger’s account in the video, the bank has accepted his self-issued currency. It’s beyond exciting. There are more details you’ll want to check out in the video, but that’s the gist of it. Tellinger states that this process should work even in the U.S. (I’m not so sure), but doesn’t cite the relevant code for the U.S. as he does for South Africa (which of course makes sense because he’s in South Africa and not the U.S.).
Please note that some people think Tellinger is a charlatan. I don’t necessarily endorse or not endorse this particular strategy at this particular time, I’m just pointing out that self-issued currency IS A THING, in South Africa at least. Is this “patriot mythology?” I don’t know. Would a US court have a problem with this? Don’t know. It’s damned intriguing, though. Let me state clearly and unequivocally: none of the above is legal advice and I am not an attorney.
Stay tuned for part two!
IMPORTANT NOTE/DISCLAIMER: The above article is not legal advice and was not written by an attorney. It is merely a collection of common-sense, rational observations written by a sane, rational layperson with common sense. It is recommended that you consult with an attorney for any and all legal advice and/or action.