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As predicted the US on its way into a depression. Where has the money gone?
Is the US going to use the Active Denial System (ADS) on its own citizens?

Central banks have been lending vast sums of money to the banking system. Central banks are backed by governments and can always print enough cash to meet all demands.

Governments themselves have been pumping mind-boggling sums of money into banks by buying shares in them. In the UK, £37bn of new shares in banks have been purchased by the government - £20bn in the Royal Bank of Scotland alone.

In addition, the government has guaranteed everyone's personal deposits in banks up to £50,000. In practice, as with Northern Rock and Bradford & Bingley, the government would almost certainly guarantee all deposits if a bank ran into difficulties. Even private deposits in the failed Icelandic banks have been guaranteed by the UK government.

Disappearing wealth

So where has all the money gone? Your money is still there. So don't worry about that.

Nevertheless, money is being eroded in value by inflation. £100 today can buy only about 95% of what it could last year and only about half as much as it could 20 years ago. This is one reason why we need to be paid interest to save money.

But what about so-called "sub-prime debt"? This was money lent to people unlikely to be able to pay it back. The problem is that the loans were mainly to buy houses and houses have fallen in value. Thus if people sold their house, they would not get their money back.

It's the same with stocks and shares. If you had bought £1,000 worth of shares a year ago, they would be worth only around £670 today and maybe less in the future.

But houses and shares are not money. They are assets whose value varies with market forces. If demand rises and/or supply falls, their price will rise. If demand falls and/or supply rises, their price will fall. Don't forget that warning in small print: "prices can go down as well as up".

Thus your money as bank deposits may not have disappeared. But some of your wealth may well have.

Regarding the last question about the ADS he answer is if necessary yes they will use it to control any crowds or rallies.

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