In today’s financial system, what many people take for granted as foundational truths are actually deeply flawed assumptions or outright deceptions.
Below is a breakdown of commonly misunderstood financial concepts—reframed to reflect a more accurate interpretation of how the system really works.
Myth #1: “Risk-Free” Returns
For decades, US government bonds were treated as the ultimate safe haven—where investors could stash cash with the promise of stability and zero risk.
That all changed in 2022, in 2022, the worst year for Treasuries in American history. The benchmark 10-year Treasury dropped nearly 18%, while the 30-year collapsed over 39%. Many bonds fared even worse.
Even stretching back 250 years, you won’t find a more devastating year for the so-called “risk-free asset” that underpins the global bond market.
That should have permanently buried the myth that Treasuries are risk-free. Yet many individuals—and nearly every major financial institution—still thoughtlessly cling to this belief.
Moreover, with the real rate of currency debasement far outpacing nominal interest rates, Treasuries have become a losing proposition. They no longer offer a “risk-free return.” What they deliver instead is “return-free risk.”
Myth #2: The Lender of Last Resort and Fictional Reserve Banking
The idea that central banks act as a backstop during crises—a “lender of last resort”—sounds noble.
In times of financial turmoil, they step in to inject liquidity and restore order. The narrative is that central banks prevent economic collapse by offering emergency funding when private lenders won’t. It’s a safety net, a stabilizer, a guardian of last resort.
However, when central banks create money out of thin air to rescue failing institutions, it’s really just legalized counterfeiting.
And let’s be clear: the money you think you have in the bank? It’s not actually there.
Most banks would collapse if even a tiny portion of depositors tried to withdraw their funds. That’s because of fractional reserve banking—a practice that would be considered outright fraud in any other industry.
Imagine a car dealership or jewelry store running on a fractional reserve model—creating more claims for cars or gold necklaces than they physically have. It’d be laughed off as a Ponzi Scheme. Yet, it’s not only legal in banking—it’s the standard.
The only reason it seems to work is because banks have the Federal Reserve as a backstop, the “lender of last resort.” When trouble hits, the Fed steps in to bail them out by creating more currency units out of thin air.
No such lifeline exists for car dealers or jewelers—because no one can create new cars or necklaces out of thin air to make things whole.
That’s why fractional reserve banking is really fictional reserve banking. The reserves don’t exist in any meaningful way—the system runs on smoke, mirrors, and a lot of blind trust. The illusion only holds because central banks stand ready with the money printer to bail it out when cracks appear.
So here’s the plain-English translation: “Lender of last resort” means legalized counterfeiting to backstop a legalized Ponzi Scheme.
Myth #3: Policymakers Are Just Central Planners in Disguise
We often hear about “policymakers” adjusting economic levers to keep things stable. But this is really central planning by another name—more in line with top-down command economies than the free markets we’re told we live in.
Myth #4: Many Elites Don’t Create Wealth
In many cases, those referred to as “elites” are not wealth creators but wealth extractors—parasites living off the productivity of others through favorable regulations, insider deals, seigniorage, cronyism, and bailouts. They are more accurately called parasites.
Myth #5: The Federal Reserve is a Free Market Institution
In The Communist Manifesto, Marx’s fifth plank calls for the “centralization of credit in the hands of the state, by means of a national bank with state capital and an exclusive monopoly.” That’s a spot-on description of the Federal Reserve and other central banks.
In reality, the Fed is nothing more than a politburo of bureaucrats attempting to centrally plan the economy by tinkering with the money and interest rates—the most important prices in all of capitalism.
Even if we presume the Fed has benign intentions—which it doesn’t—central planning is an impossible task, and failure is inevitable.
That’s why the Fed is in a mission-impossible situation—much like it was an impossible task for the Soviets to centrally plan their economy.
The best thing you can do is recognize that the Fed can’t save the day any more than the State Planning Committee of the USSR could—and get positioned accordingly.
Conclusion
Many of the foundational beliefs propping up the modern financial system are riddled with contradictions, euphemisms, and carefully crafted illusions.
Scratch just beneath the surface, and it becomes clear: this isn’t a system rooted in free markets—it’s one driven by deception, control, and theft.
Seeing through the lies is no longer optional—it’s essential.
Because the conditions are in place for a major monetary reset… and soon. If history is any guide, a significant devaluation of the US dollar isn’t just possible—it’s all but guaranteed.