The abjectly fictional nature of modern paper currency and fractional-reserve banking encourages the question: why do fiat FRNs continue to circulate, and banks without any real monetary reserves continue to function? Those who accept the theory that "money" is whatever the government decrees would answer that FRNs (or bank-deposits denominated in FRNs) have value as media of exchange in the marketplace because people must acquire them in order to pay their taxes. The obvious fallacy here, though, is that the government accepts payment of taxes in FRNs precisely because those notes have a finite purchasing-power in the market, and therefore are usable as "money" by the government. It is not the present and future taxability of the notes that gives them their market exchange-value, but their residual market exchange-value that renders them viable as a medium of taxation. One must recall that FRNs were originally redeemable, directly or indirectly, in gold coins, silver coins, or both. For that reason, FRNs had a real exchange-value in the market that reflected their underlying redemption-values in gold or silver, and depended not at all on their use as a medium of taxation but indeed made them valuable for that purpose. When FRNs became wholly irredeemable after 1968/1971, they lost any fixed or predictable market exchange-value in terms of real money, and therefore became of increasingly uncertain value as a medium of taxation, too (at least to the extent they continue to depreciate in market exchange-value, as they have, steadily, since then). A more realistic explanation for the continued circulation of FRNs (or bank-deposits denominated in FRNs) as "money" is that the general public is the victim of a confidence-game, in which the government and the banks have foisted off paper liabilities in the place of real monetary assets in an inverted pyramid of monetary fraud. At the tip of this upside-down pyramid are real "dollars": silver and gold coins that are themselves monetary assets and no one's liabilities, and circulate among those knowledgeable about the differences between real money and paper money. Next in amount in circulation - and at the first level of the institutionalized fraud - are the base-metallic token (or "clad") coins of cupro-nickel alloy. These are monetary assets to the extent of their salvageable metallic content - which is worth about 2% or less of their face values - , but otherwise are liabilities of the government which at one time were redeemable in silver, but are today wholly irredeemable. The next largest fraudulent circulating medium consists of actual FRNs, today "redeemable" only in "clad" coins. Finally, the greatest portion of the so-called "money supply" consists of bank demand-deposits, most of which have been loaned at interest to persons other than the depositors. Revealingly, not only are these purported deposits not actually on deposit in the banks at all, but also the deposits are not even formally "redeemable", because the deposits themselves are not the depositors' "money", but the banks'! The deposits are loans of money the depositors (many of them unknowingly) have made to the banks, and which the banks have then further loaned to third parties. But how many people are aware of this situation? Why do the government and the banks not educate those who are unaware of what is really going on - other than because the government and the banks knowingly profit from public ignorance and therefore intentionally promote it? And how long can such a swindle continue? This question highlights the second of the contemporary political-economic conditions that underlie the problem of collapsing domestic banks: namely, the inability of the banks to continue indefinitely to increase the supply of money within the domestic economy, that is (as the saying goes), to "expand credit" (because the supply of new money derives from the extension of bank-credit to borrowers). The answer to the question "How long can this confidence-game last?" is "Not forever!". If, on the one hand, the banks overly expand credit, hyperinflation occurs (that is, the purchasing-power of the monetary unit falls exponentially). If, on the other hand, the banks overly restrict the expansion of credit in order to avoid hyperinflation, recession and then depression occurs (that is, people borrow less, and then existing borrowers in massive numbers default on loans). The bankers' "trick" (and dilemma) is to continue to expand credit within an expanding, and therefore essentially noninflationary, economy. The insoluble problem inherent in credit-expansion through fractional-reserve banking, however, is that expansion of a fiat money supply inevitably misdirects and wastes real economic resources, resulting in an increasingly nonrational economy - that is an economy that does not expand in real terms. In short, credit-expansion by fractional-reserve banking in the long run guarantees economic collapse, with resultant social chaos and political crisis. CONCLUSIONNo crystal ball is necessary to predict that a turning-point in the history of money and banking in the United States is drawing nigh. The burden of governmental debt - much of it made possible only by central-bank "monetization" - has approached levels unsustainable in real terms even with drastically increased confiscation of Americans' earnings through explicit taxation. But Americans seem reluctant to accept more taxation to fund the never-ending follies of a spendthrift welfare state. Thus, repudiation of the debt (in whole or in part) through extreme depreciation of FRNs and bank-deposits denominated therein appears likely, if not certain. For this looming debacle, Americans can thank the FRS, the "experts" who administered it since 1913, the politicians who wed it as a "cover" to finance their own careers, the bankers who profited from their monopoly over the emission of "legal-tender" paper currency, and the "intellectuals" in academia, the press, and the media who (quite unlike their counterparts in the last century) remained strangely silent on the issue of money and banking. That is, Americans can properly thank these people if Americans become aware of what the FRS is, what it does, and why it is responsible for having undermined to the point of collapse the nation's once proudly prosperous economy and staunchly republican political process. Hopefully that day of a new national awareness will soon be at hand.