By Tom Dennen
"This country, with its institutions, belongs to the people who inhabit it. Whenever they shall grow weary of the existing Government, they can exercise their constitutional right of amending it or their revolutionary right to dismember or overthrow it."--Abraham Lincoln, 1861.
Capitalism is a study of theft on a huge and consistent scale that few ordinary mortals understand those who do keep it to themselves and have been stealing for thousands of years.
A s of right now, the six billion human beings on the planet owe the international banksters one hundred and ninety thousand dollars.
In the coming years, several million people are going to die because of that debt – in the emerging Great Recession.
How did we get into this?
The American people – and the rest of the failed Capitalist world – are finally looking at the enormity of the deformity of reality they have been forced into for the last three hundred years, and are understandably angry.
The exposure of the 911 Reichstag false flag ‘inside job' by the associations of American architects and engineers, truth tellers and many other aware and intelligent Americans, Europeans and other human beings has opened the floodgates to the knowledge of the political and economic deceptions the world has been exposed to for too many years:
Grand Theft, Planet.
In their quest for wealth, the New World Order psychopaths have stolen not only the American Dream, but also the dreams of every ‘useless eater' on the planet.
Mickey Mouse died in Viet Nam along with Mom, Pop and Apple Pie, but that's not all, America's moral high ground was stolen from its people – along with their honor, their sense of fair play and justice, virtue, the pursuit of happiness; their conscience and duty subjugated with torture, their loyalty, fidelity and trust – love, hope and dreams all stolen, replaced with poverty and fear, all trust gone now in the wake of a global war for wealth.
But the public consciousness has discovered and is examining the depth of the theft of not just monetary wealth, but the theft of those virtues the theft of their honor; a grand theft without any precedent in history; theft of the ownership of self through debt.
Evil is alive in the wars surrounding this planet doing nothing but killing for money.
“TROUBLE ON THE WATERFRONT, EVIL IN THE AIR ” –The Band.
There was a great piece going around the Internet recently about Heidi the bar owner who gave all her old drunk customers credit for a year.
Heidi is the proprietor of a bar in Berlin .
In order to increase sales, she decides to allow her customers, most of whom are unemployed alcoholics, to buy now and pay later.
Word gets around and as a result, customers flood into Heidi's bar!
Taking advantage of her customers' freedom from immediate payment constraints,
Heidi increases her prices, and her volume increases dramatically!
A young go-getter at the local bank recognizes these debts as valuable future
assets and increases Heidi's borrowing limit.
He sees no reason for concern since he has the debts of the alcoholics as collateral.
At the bank's corporate head office, experts transform these customer assets into DRINKBONDS, A LKYBONDS and PUKEBONDS.
These securities are then traded on the world market.
It should be pointed out that no one really understands what the names of these bonds
mean, or how the securities are guaranteed.
Nevertheless, as their prices continually climb, the securities become top-selling items.
Life is good !
One day, although the prices are still climbing, a risk manager, (subsequently fired for negativity), decides that the time has come to demand payment of the debts incurred by the drinkers at Heidi's bar.
However, they cannot pay back the debts.
Heidi cannot fulfill her loan obligations and claims bankruptcy.
DRINKBOND and A LKYBOND drop in price by 95%.
PUKEBOND performs a little better, stabilizing after dropping only 80%!
The suppliers to Heidi's bar, having granted her generous payment-due dates, and having invested in the securities, are now faced with a new situation!
Her wine supplier claims bankruptcy, and her beer supplier is taken over by a competitor.
The bank is saved by the government following dramatic round-the-clock consultations
by leaders from the governing political parties.
The funds required for this emergency bail-out are obtained by a special tax levied on, guess who?
In the real world, okay you get free beer (credit) for a while, and then you lose your home, become a drunk and find a ‘Heidi Place' in which to wonder HTF it could have happened to you.
Here's what basically happened to the global ‘money' markets over the last eight or ten years, not counting the ‘normal' bull and bear ups and downs, black swans, dojis and TED spread specs or the dotcom (you buy 50m of my stock and I buy 50m of yours and boy we look so good on paper! ) ‘Bubbles' – and other vicissitudes in the game of money manipulation and other scams notwithstanding:
This one is dead simple although you do have to have money to make money no matter how deviously:
A pproach as many people as possible who are paying low rentals on the properties they live in after buying all those properties (speculatively, but cheaply because of the many rental defaults at that level).
You can identify ‘those people' by the way they dress, don't have jobs and hang in Heidi's bar.
Then you offer them an opportunity they can't refuse: ownership of those properties at a rate lower than the rental they are paying (sub-prime) and then lean on them until they sign the ( A djustable Rate) mortgages (an A RMS deal of note).
The deal you offer includes a no-deposit clause as a sweetener but the fine print that outlines the A RMS conditions of the sale you do not bring up for in-depth discussion during the deal.
These were loans made to people with no credit, marginal ability to pay, using the purchased house as security
Let's keep the math simple, too:
Let's say our home loan deal projects a yield of twenty billion profits during the 20 years over and above the original investment.
But you want your money now. So you call this ‘money', this twenty-year future profit something else, you call it a ‘leveraged commodity'. (For leverage read risk).
We all know and understand the risks in the property market and totally accept the strongest pillar of that understanding: “House prices never go down because the people who own them are credit-worthy and locked into 20-year mortgages.”
A home, to the average taxpayer, “is the greatest single investment” s/he will ever make and it's the first thing paid off every month. The system is locked into a paradigm (a fixed system) called the home loan market, which has been the status quo for yonks ( Don key's Years).
The current 'global meltdown' can be summed up in one word: Mortgage, the glue that holds usury together at every level.
You get into a mortgage at around twenty-five years of age and get out at around forty-five, twenty years later, those twenty years being the best, most productive years of your life, mostly spent working like a donkey.
This system is a not-so-subtle theft of wealth, and we accept it 'just because it's the system'. But if, as 'Hidden Hand' economist A dam Smith has it in his 'Wealth of Nations', "Work is the basis of all wealth, all well-being, while monopoly and cartels are obstacles for the beneficial processes,” then most of us have been robbed of a lifetime of well-being.
A nd Don key's Years are too long for investors - the acceleration in the rate of change today is reflected on an asymptotic curve and no one waits twenty years anymore for returns - Getting your money now is much more fun.
So we change some rules.
The 20bn has now become a 'structured' commodity and commodities are what drive sales on the exchanges of the world.
My twenty billion ‘book' is now an ‘instrument' that's almost guaranteed to give your firm a return of twenty billion rand over twenty years for a ten billion rand investment in today's money will eventually double your investment.
But I get my money today and take a smaller, but immediate, profit.
T A KE THE MONEY A ND RUN
The next buyers make money, everyone doubles their money, but the next guys also want an immediate return, rename the package and sell it off again.
A nd that's where it started: Debts were renamed, repackaged and turned into commodities that were sold, over and over again throughout the investment world.
If you belong to a school board in a small town in Iceland , you may have invested some of that board's money in one of those subprime ‘derivatives'.
Simply put, under this A RMS deal the buyer paid a couple of percent under prime for x amount of years, which was then adjusted closer to prime then to prime, THEN, because by then he has paid BELOW prime for a number of years, his mortgage is adjusted UPW A RDS to the same number of points A BOVE prime that the buyer paid BELOW prime in the early stages of the mortgage, just to balance the books.
It's at this time, when the mortgage payback becomes more than the original rental that money simply and predictably runs out, defaults return and foreclosures begin.
“Where's my return?” cries the prefect in the little Icelandic School Board.
“There is none,” reply Northern Rock, Lehman Brothers, Freddy and Fannie Mac et al holding bailout bags full of a future that can no longer be derived from bad debt.
A ll deliberately organized and implemented. With the collusion of the Bush A dministration and the privately owned Federal Reserve Bank: A lan Greenspan, in the early 2000s, brought The Fed's interest rate down to one percent.
The lenders grabbed as much of that cheap money as possible, lent it out on sub-prime A RMS deals and hoarded against the sup prime foreclosure crisis at which point they (still are) buying vast tracts of residential properties at fire sale prices. The same is happening with the Fed's interest so low it's almost free money, in fact trillions of dollars of ‘bailout' money is free, and the banks are hoarding again without saying anything about what's been done with the money, instead of lending the money into the market to ‘restart' the U.S. economy.
That this is all orchestrated and planned is hidden in the unexamined truth behind the sudden disappearance from the A merican scene of the Governor of the State of New York, the man accused and charged by the U.S. Federal government of transgressing the Mann A ct, which makes illegal the transport of people from one State to another (across State Lines) for “the purposes of prostitution.”
Former New York Governor Elliot Spitzer (Today's Gracchus to Bush's Nero – see Tacitus' A nn als, below, Bush did not yield! ) was cleared in the first week of November, 2008 of a serious offense against the Mann A ct, a much more serious Federal Offense as opposed to a State Offense against prostitution laws.
Well, they didn't really clear him; they just 'declined to prosecute' as in the case of several local politicians.
Why? The Bush administration's job was done: It has been universally accepted that the political assassination of Elliot Spitzer was engineered by the Bush administration because of his public accusations against the United States Federal Reserve Bank (Lincoln, Kennedy, Iraq, Iran, Pakistan et. al.) and the top Wall Street bankers and lending institutions of a predatory lending practice called 'sub-prime' mortgaging, which we have examined.
Spritzer and most of the other fifty state governors were watching their constituents being robbed by Wall Street through this lending practice, losing their livelihoods, losing their houses, losing their pensions, losing their lifetime accumulation of wealth.
Once this practice was integrated into the banking system, it was - many believe deliberately - allowed to escalate into trillions of dollars of international Triple- A securities loans backed by massively (unknown to global purchasers) defaulting loans and sold to the European and other global bankers who are reported to be 'furious' with Wall Street and (right now, Europe, China and a host of others) are pulling out of the dollar.
China and A rab Emirates are clubbing together supporting the Yuan as the world's default currency, but I would add, “watch the Yen.”
Russia and Iran are coupled on the tote in the sense that the A mero/Israeli insanity of attacking Iran – by definition an attack on Russia – would precipitate WW3.
A S THE DEF A ULT loan payments stopped coming in (Heidi's drunks) the fuel for the debt-based trading ran out and the third biggest financial bubble ever created began to deflate.
The biggest is the coming-soon-to-a-neighborhood-near-you Credit Default Swap bubble and the second biggest, the Commercial Property Default bubble is a front runner.
One man put his finger in the dyke. But instead of helping him stem the tide, they broke his finger.
'They' took him out with a short, sharp, vicious and unprecedented public humiliation: Formally charging him with associating with prostitutes 'across state lines'.
How often are prostitutes' clients 'busted'?
A ll of you men can answer that one.
We all know how often public outrage has insisted on, demanded! Lists – names, addresses, pictures, and videos - of the men who visit 'the working girls'.
Successfully, as far as I know, only once, and in New York State.
A nd only one name on the list: Elliot Spitzer – that was the power of the Bush administration.
But then, Spitzer was trying to save the world from Capitalism gone awry, a world that includes us here, now, with our falling housing prices – and that takes either a Superman or a brave little Dutch Boy.
He actually tried!
He stood up, thinking that as governor of one of the most powerful states in A merica , he could rally the nation against the banksters who were running it.
He brought out his guns and fired them off on MSN A BC and Fox News, all the wire services, at the whole world that did not listen:
He fired the first (and only) volley of his charge inside the prestigious A merican National Press Club thinking that this shot would be so loud it would be heard around the world, and that the media would follow his leading charge against the crime of the millennium, Grand Theft Planet ®.
The price of your house today is an echo of that shot.
GR A ND THEFT, PL A NET ©. A ND THE RULING ECONOMY'S COLLUSION
Some excerpts from Spitzer's volley published in the Washington Post:
"Several years ago,” Spitzer said, “state attorneys general and others involved in consumer protection began to notice a marked increase in a range of predatory lending practices by mortgage lenders.
"Some were misrepresenting the terms of loans, making loans without regard to consumers' ability to repay, making loans with deceptive "teaser" rates that later ballooned astronomically, packing loans with undisclosed charges and fees, or even paying illegal kickbacks.
"These and other practices, we noticed, were having a devastating effect on home buyers. In addition, the widespread nature of these practices, if left unchecked, threatened our financial markets.
"Even though predatory lending was becoming a national problem, the Bush administration looked the other way and did nothing to protect A merican homeowners.
"In fact, the government chose instead to align itself with the banks that were victimizing consumers.
"Predatory lending was widely understood to present a looming national crisis.
“This threat was so clear that as New York attorney general, I joined with colleagues in the other 49 states in attempting to fill the void left by the federal government.
"Individually, and together, state attorneys general of both parties brought litigation or entered into settlements with many sub prime lenders that were engaged in predatory lending practices. Several state legislatures, including New York 's, enacted laws aimed at curbing such practices."
The Washington Post added a flanking volley with its own comment, initially joining the leading charge:
"What did the Bush administration do in response? (To Spitzer's charges). Did it reverse course and decide to take action to halt this burgeoning scourge? A s A mericans are now painfully aware, with hundreds of thousands of homeowners facing foreclosure and our markets reeling, the answer is a resounding no."
(The Washington Post, as you are aware, was the journal that brought down the Nixon administration).
Trussed, eviscerated (but not ‘suicided'), Spitzer was held in check by threats of criminal prosecution under the Mann A ct.
This is his capitulation speech after being told on the sixth of November 2008 that he was not to be prosecuted:
"I appreciate the impartiality and thoroughness of the investigation by the U.S. A ttorney's Office, and I acknowledge and accept responsibility for the conduct it disclosed. I resigned my position as Governor because I recognized that conduct was unworthy of an elected official. I once again apologize for my actions."
Spitzer, the 54th governor of the State of New York , officially resigned on Marc h 17, 2008 after he was found to be a client of the Emperor's Club VIP that was busted days before. He has remained out of the public eye until his November 7 speech,
This is his legacy:
"When history tells the story of the sub prime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners, the Bush administration will not be judged favorably.
"The tale is still unfolding, but when the dust settles, it will be judged as a willing accomplice to the lenders who went to any lengths in their quest for profits.
"So willing, in fact, that it used the power of the federal government in an unprecedented assault on state legislatures, as well as on state attorneys general and anyone else on the side of consumers."
A small summation:
" A merican capitalism, based as it is on exploitation of the poor, with its fundamental motivation in personal greed, simply cannot survive without force - without a secret police force. Now, more than ever, each of us is forced to make a conscious choice whether to support the system of minority comfort and privilege with all its security apparatus and repression, or whether to struggle for real equality of opportunity and fair distribution of (resource-based economy) wealth for all of society, in the domestic as well as the international order. It's harder now not to realize that there are two sides, harder not to understand each, and harder not to recognize that like it or not we contribute day in and day out either to the one side or to the other - "INSIDE THE COMP A NY: CI A DI A RY . By Philip A gee . (Penguin Books, 1975), p597.
“When we look at classical/neoclassical economics, how can its intent be determined? In the absence of any stated purpose, one can examine the things it does and those it doesn't. In the (almost three) centuries it has been practiced, orthodox classical capitalism has not brought a growing or even a stable level of prosperity to the peoples who inhabit the countries in which it has been practiced. Spurts of apparent prosperity have been continuously destroyed by economic crashes that have over and over again ruined the lives of millions.” Professor John Kosy, Global Research.
(The first Capitalist crash (called the South Sea Bubble) was in 1720. there have been four others since then, on a schedule as regular as clockwork. Today's ‘Global Meltdown' is number six.)
“But what if its (Capitalism's) intent has never been the promotion of the people's prosperity? What, if any, result has it attained consistently? Well, it has consistently protected the wealth of the privileged; it has preserved the status quo. The wealthy privileged increase their wealth in good times and in bad. The system works for the privileged just as the market works for stock brokers who make money when prices are rising and when they are falling. If this is capitalism's intent, and the evidence for it is overwhelming, understanding the Obama administration's, and the developed world's response to the current economic downturn is easy. A s the meager apparent wealth that the common people acquired during the better years now disappears, as they lose their jobs and homes, the wealthy institutions and the people who manage them and created the downturn are rewarded and prevented from failing by obligating the common people to someday repaying a growing colossal national debt incurred for the sake of those privileged. None of this makes sense unless capitalism's intention is to preserve the status quo at the people's expense.
“Of course, we're told that a stable financial system is essential to economic prosperity. We're told that credit must be easily acquired again, so that businesses can meet payroll and consumers can resume buying. But these claims are also irrational. Businesses properly should be capitalized by investment and products should be purchased with earnings. So why do governments claim businesses and consumption need to be financed by debt? The answer is really very simple. The wealthy increase their wealth by lending and they do it without even having to use their own money by means of the Ponzi scheme known as fractional reserve banking. A nd when debtors cannot meet their obligations, their assets are acquired by the wealthy at fire sale prices who then become even wealthier. This is what capitalism does; it does it consistently and spectacularly. It really can have no other purpose. Credit is good only for creditors; debtors always lose.“ – ibid , Kosy.
Just a parenthetic note for those who are predicting hyperinflation:
“ It seems as if Romer, Bernanke, et al. are proposing something new and revolutionary – inflate the money supply and devalue the currency. Genius! But there is a big problem. This solution is neither new nor revolutionary. A lthough it has never before had as fancy a euphemism as "quantitative easing," the practice of monetary devaluation is ancient and is standard government operating procedure. Unfortunately, it has also proven a disaster everywhere it has been implemented.
The Romans tried it. The result was the implosion of Western civilization; a hole out of which it took a millennium for Europe to climb.
The French tried it. Twice, in fact. The first time, in the early 18th century, resulted in a classic speculative bubble. Fortunes were made and then lost in the blink of an eye. The second time, after their revolution, was even worse. In order to combat price inflation – which was causing rioting and civil unrest – the government imposed price controls. Shortages ensued causing more rioting and civil unrest. The French finally gave up and instituted a gold standard.
“The Germans tried it after World War One. Their experience was much worse than the French experience but the outcome wasn't quite as bad as the Romans – the Weimar inflation contributed to the rise of National Socialism and the subsequent deaths of over 72 million people – Okay, maybe it was as bad as the Romans.
“The Russians have also tried it. A s have the Poles, the Hungarians, the Greeks, the Chinese, the A rgentineans, the Brazilians, the Chileans, and the Yugoslavians. Oh, and the Zimbabweans are trying it right now.
“ A ll of these episodes ended in catastrophe. Of course, the A merican experience will be different, right? A fter all, folks like Romer and Bernanke are experts, doing the same thing over and over again, expecting different results. We all know what that defines.
“German Finance Minister Karl Helfferich was an expert on money, too, and even he could not resist the temptation to crank up the printing press:
“To follow the good counsel of stopping the printing of notes would mean refusing to economic life the circulating medium necessary for transactions, payments of salaries and wages, etc. It would mean that in a very short time the entire public, and above all the Reich, could no longer pay merchants, employees, or workers. In a few weeks, besides the printing of notes, factories, mines, railways, and post offices, national and local government, in short, all national and economic life would be stopped.
“ A s it turned out, it was the continued printing of money – and not the cessation – that caused all of these things to occur. But we know better now, right?
“No matter what the epoch, the laws of economics remain constant. Prices are information. They relay to entrepreneurs where to best allocate resources in order to satisfy consumer demand.
“Because it is a society's medium of exchange, money has a universal price; generally, everything is priced in terms of money. Distort the price of money and you throw the entire system into disarray causing what A ustrian economists call malinvestment. Resources flow into areas that they should not and away from areas where they should, not because entrepreneurs have lost the ability to make sound decisions, but because the information upon which they rely to make those decisions is corrupted.
“Romer and Bernanke are playing a dangerous game. They are also operating under false premises. First of all, the Great Depression was not caused by a "lack of aggregate demand" but by the malinvestment brought on by the Fed's monetary inflation of the 1920s. The reason the depression lasted so long was that the government refused to allow the malinvestment to liquidate.” – Glen Jacobs, actor, economic commentator.
"The Nazis came to power in Germany in 1933, at a time when its economy was in total collapse, with ruinous war-reparation obligations and zero prospects for foreign investment or credit. Yet through an independent monetary policy of sovereign credit and a full-employment public-works program, the Third Reich was able to turn a bankrupt Germany , stripped of overseas colonies it could exploit, into the strongest economy in Europe within four years, even before armament spending began." – Henry C. K. Liu, "Nazism and the German Economic Miracle," A sia Tim es ( May 24, 2005 ).
“While Hitler clearly deserves the opprobrium heaped on him for his later atrocities, he was enormously popular with his own people, at least for a time. This was evidently because he rescued Germany from the throes of a worldwide depression – and he did it through a plan of publi c w orks paid for with currency generated by the government itself. Projects were first earmarked for funding, including flood control, repair of public buildings and private residences, and construction of new buildings, roads, bridges, canals, and port facilities. The projected cost of the various programs was fixed at one billion units of the national currency. One billion non-inflationary bills of exchange called Labor Treasury Certificates were then issued against this cost. Millions of people were put to work on these projects, and the workers were paid with the Treasury Certificates. The workers then spent the certificates on goods and services, creating more jobs for more people. These certificates were not actually debt-free but were issued as bonds, and the government paid interest on them to the bearers. But the certificates circulated as money and were renewable indefinitely, making them a de facto currency; and they avoided the need to borrow from international lenders or to pay off international debts.6 The Treasury Certificates did not trade on foreign currency markets, so they were beyond the reach of the currency speculators. They could not be sold short because there was no one to sell them to, so they retained their value.
“ … The notion that a government could fund itself by printing and delivering paper receipts for goods and services received was first devised by the A merican colonists. Benjamin Franklin credited the remarkable growth and abundance in the colonies, at a time when English workers were suffering the impoverished conditions of the Industrial Revolution, to the colonists' unique system of government-issued money. In the nineteenth century, Senator Henry Clay called this the “ A merican system,” distinguishing it from the “British system” of privately issued paper banknotes. A fter the A merican Revolution, the A merican system was replaced in the U.S. with banker-created money; but government-issued money was revived during the Civil War, when A braham Lincoln funded his government with U.S. Notes or “Greenbacks” issued by the Treasury.”
The Lessons of History: Not A lways What They Seem
“ … Germany 's scheme for escaping its crippling debt and reinvigorating a moribund economy was clever, but it was not actually original with the Germans. The notion that a government could fund itself by printing and delivering paper receipts for goods and services received was first devised by the A merican colonists. Benjamin Franklin credited the remarkable growth and abundance in the colonies, at a time when English workers were suffering the impoverished conditions of the Industrial Revolution, to the colonists' unique system of government-issued money. In the nineteenth century, Senator Henry Clay called this the “ A merican system,” distinguishing it from the “British system” of privately issued paper banknotes. A fter the A merican Revolution, the A merican system was replaced in the U.S. with banker-created money; but government-issued money was revived during the Civil War, when A braham Lincoln funded his government with U.S. Notes or “Greenbacks” issued by the Treasury.
“The dramatic difference in the results of Germany 's two money-printing experiments was a direct result of the uses to which the money was put. Price inflation results when “demand” (money) increases more than “supply” (goods and services), driving prices up; and in the experiment of the 1930s, new money was created for the purpose of funding productivity, so supply and demand increased together and prices remained stable. Hitler said, “For every mark issued, we required the equivalent of a mark's worth of work done, or goods produced.” In the hyperinflationary disaster of 1923, on the other hand, money was printed merely to pay off speculators; causing demand to shoot up while supply remained fixed. The result was not just inflation but hyperinflation, since the speculation went wild, triggering rampant tulip-bubble-style mania and panic.
“This was also true in Zimbabwe , a dramatic contemporary example of runaway inflation. “The crisis dated back to 2001, when Zimbabwe defaulted on its loans and the IMF refused to make the usual accommodations, including refinancing and loan forgiveness. “ A pparently, the IMF's intention was to punish the country for political policies of which it disapproved, including land reform measures that involved reclaiming the lands of wealthy landowners. Zimbabwe 's credit was ruined and it could not get loans elsewhere, so the government resorted to issuing its own national currency and using the money to buy U.S. dollars on the foreign-exchange market. These dollars were then used to pay the IMF and regain the country's credit rating. A ccording to a statement by the Zimbabwe central bank, the hyperinflation was caused by speculators who manipulated the foreign-exchange market, charging exorbitant rates for U.S. dollars, causing a drastic devaluation of the Zimbabwe currency.
“The government's real mistake, however, may have been in playing the IMF's game at all. Rather than using its national currency to buy foreign fiat money to pay foreign lenders, it could have followed the lead of A braham Lincoln and the A merican colonists and issued its own currency to pay for the production of goods and services for its own people. Inflation would then have been avoided, because supply would have kept up with demand; and the currency would have served the local economy rather than being siphoned off by speculators.
The Real Weimar Threat and How It Can Be A voided
“Is the United States , then, out of the hyperinflationary woods with its “quantitative easing” scheme? Maybe, maybe not. To the extent that the newly created money will be used for real economic development and growth, funding by seigniorage is not likely to inflate prices, because supply and demand will rise together. Using quantitative easing to fund infrastructure and other productive projects, as in President Obama's stimulus package, could invigorate the economy as promised, producing the sort of abundance reported by Benjamin Franklin in A merica 's flourishing early years.
“There is, however, something else going on today that is disturbingly similar to what triggered the 1923 hyperinflation. A s in Weimar Germany , money creation in the U.S. is now being undertaken by a privately owned central bank, the Federal Reserve; and it is largely being done to settle speculative bets on the books of private banks, without producing anything of value to the economy. A s gold investor James Sinclair warned nearly two years ago:
“[T]he real problem is a trembling $20 trillion mountain of over the counter credit and default derivatives. Think deeply about the Weimar Republic case study because every day it looks more and more like a repeat in cause and effect … ” - Jim Sinclair, “Fed A ctions a Band- A id on a Gaping Economic Wound,” reprinted in Go for Gold, September 18, 2007.
“The $12.9 billion in bailout funds funneled through A IG to pay Goldman Sachs for its highly speculative credit default swaps is just one egregious example. To the extent that the money generated by “quantitative easing” is being sucked into the black hole of paying off these speculative derivative bets, we could indeed be on the Weimar road and there is real cause for alarm. We have been led to believe that we must prop up a zombie Wall Street banking behemoth because without it we would have no credit system, but that is not true. There is another viable alternative, and it may prove to be our only viable alternative. We can beat Wall Street at its own game, by forming publicly owned banks that issue the full faith and credit of the United States not for private speculative profit but as a public service, for the benefit of the United States and its people. - Ellen Brown, Global Research, May, 2009.
Big difference. A nd just what South A frica needs under the new leadership – preventive financial measures.
A merica Externally:
Hamas is the democratically elected voice of the people of Gaza , the government of Gaza , yet, "... the United States has consistently given frequent and enthusiastic support to the overthrow of democracy in favor of "investor friendly" regimes. The World Bank, IMF, and private banks have consistently lavished huge sums on terror regimes, following their displacement of democratic governments, and a number of quantitative studies have shown a systematic positive relationship between U.S. and IMF / World Bank aid to countries and their violations of human rights."-- Edward S. Herman, economist and media analyst
LE A RNING (OR NOT) FROM HISTORY
Henry Ford said that we don't learn anything from history, so I thought I'd be the first old drunk to go have a look and see what I could learn from history, which, in money terms, actually goes quite a way back.
Come with me – I started with laws and rules, beginning with the Ten Commandments, but they just seemed to be totally extinct and completely ignored social guidelines, so I went on to Hammurabi's Code, which made much more sense. This Code was written a little later, about one thousand and seven hundred years before Christ.
On the one hand, it's all about food – production, storage, protection, and distribution, all overseen by a force of arms standing by with fierce threatening looks and heavy weapons (also known as the military-industrial complex) which, in reality, owns the system that produces, stores, protects, etc., the Daily Bread that is usually the government or military – in the first case I studied, run by Hammurabi although there wasn't much industry then.
Hammurabi's Code is a simple set of rules that makes any interruption of commerce a crime, usually raising extreme prejudice. Commerce then was run on payment of corn as well as gold and any Interruption of commerce meant interruption of corn on the way to Hammurabi's own table, hence the severity of the punishment.
Then I wandered through to a chap called Tacitus, who wrote ‘The A nn als of Rome' at about the time of Christ, which put things into some seriously modern perspective, as you will see.
Tacitus is just as interesting as Hammurabi (who just made very cool rules about commerce and personal relationships) in that Tacitus was a very dry, factual and non-partisan commentator on what was happening in Italy two thousand years ago, but he reveals an interesting scenario, which I call my General Theory of Economic Reality, dual or parallel economies operating symbiotically but without complete contact - one economy ruling the other, the ruling economy based on the ‘food chain' part of the extractable resources including people and materials, the other a ‘fiat' economy also using food, but based on credit, meaning debt, implying interest (which Rome capped at 10%, aware of the social problems of Usury).
General ‘Ike' Eisenhower warned us of the power of the ‘Military Industrial Complex' (which existed in Roman times in much the same way as today) – a ‘separate-from-the-people', resource-based economy operating outside the so-called ‘real' or ‘fiat' economy of general commerce and real estate that operated under the tax cap, the ‘In Duplum Rule' and other economic constraints on the fiat economy.
The wealth of all nations depends on many factors, but essentially rests on this parallel theory of real economics – one resource-based economy taking what it needs from the environment without ‘paying for it', and another, ‘fiat' economy dependent on the real resource wealth of the nation in which it resides, protected by the Military Industrial Complex of the time.
The fiat economy is not resource based at all but quite arbitrary and based on fluctuating and equally arbitrary rules of commerce measured in and by the manipulation and accumulation of currency, which is either printed or minted and more recently created ‘out of thin air', traditionally representing a base of gold or other 'real' hard assets that can be quickly converted to tradable currencies or, as the moneylenders realized thousands of years ago … debt.
Like the debt created with Heidi's extended booze credit.
A fter all, credit is debt and debt is money from the future that we can trade up to and including the new ‘free booze' package called Credit Default Swaps, a system of insuring a massive insult to tomorrow's children's piggy bank savings, insuring that those children's wealth gets into the banksters' hands … well, they have to grow up and get jobs and be mortgaged and all, but you have to look ahead in this world.
What a fucking evil philosophy if it is ever even deemed human, let alone a philosophy.
It's our own fault, of course, because we still don't seem to be learning anything from history.
It does help if we read some of it, though, so in case we want to avoid this meltdown thing happening again, let's assume that there is nothing wrong with the study of contemporary history: Earl y in 2009 Zbigniew Brzezinski, former National Security A dvisor and early supporter of Barak Obama's presidential campaign, warned that this meltdown could cause civil unrest on A merican soil, “a possibility that should not be dismissed”
Brzezinski explained, “the United States is going to have millions and millions of unemployed, people really facing dire straits. A nd we're going to be having that for some period of time before things hopefully improve.
“ A nd at the same time,” he added, “there is public awareness of this extraordinary wealth that was transferred to a few individuals at levels without historical precedent in A merica” - (The people Heidi sold her business to sold the debt to another bunch who sold it on and then also left the country shortly after she did.)
Brzezinski concludes with this noteworthy remark “…hell, there could even be riots” (In the United States.)
This will, of course, affect South A frica, where I live and I want to lessen that affect as much as is possible.
HOW THE OLD MONEY FELL A P A RT
“Work is the basis for all well-being, while monopoly and cartels are obstacles for the beneficial processes.” – A dam Smith, ‘The Wealth of Nations'
Money and how commerce works, from Hammurabi's Code to basic Roman Dutch law is in rules that make sure that food is always on everyone's table – any uneven distribution of wealth will foster dissent, as we well know.
Did you know that under Roman Dutch law, which applies in South A frica, you can not be charged interest that draws more than double the amount of an original loan under the ‘in duplum' rule? Now, if you don't know about that rule and the government doesn't make lenders adhere to it, you will be charged an infinity of interest.
So if you borrow ten thousand rand the most you legally have to pay back is twenty thousand – double the original amount and after that, the sum is capped, interest ceases to apply and normal legal remedies are available to the lender.
This rule and others like it also restrict banks loading interest on debts where a customer is unlikely to pay like A merican sub prime borrowers whose only required collateral was a pulse.
A lexander Del Mar, I think the world's greatest monetary historian noted: " A s a rule economists … don't take the trouble to study the history of money; it is much easier to imagine it and to deduce (and apply) the principles of this imaginary knowledge."
A little like believing in and acting on incorrect assumptions
So a little knowledge about the history of money may help keep you from other people making you a slave to it by keeping you in perpetual debt in a debt-based, or ‘Fiat' economy such as the one we live in.
‘Fiat' is part of a phrase taken from the Bible, ‘Fiat Lux' or ‘Let There be Light', words that God used while making the world.
So Fiat money is ‘let there be money' and it's simply printed or minted and paid into the fiat economy by the rulers of the military industrial complex of whatever time you are in, from Rome to today's global fiat money system – not one country in the world today uses money backed by gold or any other precious metals or commodities.
The early Roman citizen was paid by the government economy with gold, silver, copper and base metal that the government simply mined. Metals were just other resources owned by the government so the resource-based government created gold money for the use of ordinary citizens, that money being regulated as to interest charges and so on.
But once the government took its eye off the ball and stopped paying attention to its own rules, the moneylenders began ratcheting up interest rates into chaos.
To understand the future of South A frica in the context of any new money systems that will be evolving on the planet in the wake of this ‘global meltdown', one has to understand the underlying principles of fiat, or debt-based economies and government, or resource-based economies.
So this short journey through the history of money, how it came into being, how it is used and how you can use new resources-as-money thinking to your benefit should help for tomorrow.
First, “ A Fool and his Money are Soon Parted” is an axiom in the world of money: “There's a fool born every minute and two born to catch him”.
There are alternatives to debt:
Save. But save tradable commodities like gold, silver, platinum and copper instead of pension funds and other paper assets (except where you still have to by law).
“The privilege of creating and issuing money is not only the supreme prerogative of government, but is the government's greatest creative opportunity. By the adoption of these principles, the taxpayers will be saved immense sums of interest”. -- A braham Lincoln, creator of the ‘Greenback Dollar' issued by the Union government at no interest as opposed to the A merican banking system's offer of nineteen to thirty percent interest on loans to fund the A merican Civil War. The Greenback Dollar was backed by gold and the simple fact that the Union government accepted it as “legal tender for all debt, public and private”, including taxes, which really pissed off the bankers “… who understood the threat a government-issued currency represented to their wealth and power. The London Tim es wrote of Lincoln 's move...
“If that mischievous financial policy, which had its origin in the North A merican Republic , should become indurated down to a fixture, then that Government will furnish its own money without cost. It will pay off debts and be without a debt. It will have all the money necessary to carry on its commerce. It will become prosperous beyond precedent in the history of the civilized governments of the world. The brains and the wealth of all countries will go to North A merica . That government must be destroyed, or it will destroy every monarchy on the globe.”
“Following this editorial, the governments of Europe , as much under the control of the banks as the present US Government, offered to support the Confederacy, but had to quit when Lincoln issued the Emancipation Proclamation, as their own people refused to support the side in the war that favored slavery.
“ A fter the Union won the civil war and it was obvious that Lincoln would keep his greenbacks in circulation, he was assassinated. Popularized history portrays the assassination as the work of John Wilkes Booth who we are told thought the outcome of the war would be reversed by Lincoln 's death (along with simply wishing to be more famous than his father Edwin Booth). But the historical truth is that 8 other conspirators were arrested and sentenced for the plot. Of the 8, one individual stands out. Sam uel A rnold was convicted for being one of the core plotters, but was provided with a lawyer by no less a figure than Secretary of War Edwin Stanton, and then pardoned by President A ndrew Johnson!
“Following Lincoln 's death, Congress immediately repealed the Greenback law, celebrating the end of slavery by re-enslaving all A merica to the bankers!
“The struggle that was to rid the country of human slavery of the black race, however, was also to fasten upon the whole nation an economic or money slavery, which has endured to the present time..."-- Dr. R.E. Search in Lincoln: Money Martyred
“John Fitzgerald Kennedy issued his US Notes for much the same reason. On June 4, 1963 , Kennedy signed Executive Order 11110, which authorized the US Treasury to issue a new form of silver certificate.
“Kennedy issued $4,292,893,825 of cash money; free of debt and free of interest. It was a sufficient amount to allow the nation to operate without the private Federal Reserve. Just 5 months later, JFK was shot by the "crazed lone nut" Lee Harvey Oswald. A lmost immediately after Kennedy's death, the US Silver Certificates were pulled out of circulation and destroyed except for samples in the hands of collectors.
“ A telling clue lies in the fact that the Warren Commission, now widely understood to have been a cover-up, counted among its seven members John J. McCloy, who had served as head of the World Bank and President of Chase Manhattan Bank. A rather odd resume for a man charged with investigating a murder, in hindsight!
“Subsequent examination has shown that Kennedy's Executive Order 11110 was never rescinded. That would have taken an act of Congress, and in the atmosphere of near deification of JFK following his death that would have brought more public attention to what Kennedy had wanted to do. So, that Executive Order still stands.
“I have written this commentary for two purposes. First, to remind President Obama that he already has all the authority he needs to order the US Treasury to start issuing currency. He just needs to pick up the phone or stroll through that tunnel and tell them to carry out Kennedy's EO 11110. Obama has that authority. He does not need Congress or anyone else's permission.
“My second purpose is to send a message to the Federal Reserve. A nd that message is that if Obama does start issuing currency in accord with the Constitution and Kennedy's EO 11110, and anything happens to him (or for that matter to Ellen Brown), the owners of the Federal Reserve will be our first and most likely suspects”. - Mike Rivero, What Really Happened.
John F. Kennedy publicly said he aimed to get rid of the private, for gain and profit company called the Federal Reserve Bank.
He got shot, too.
TO BEGIN A T THE BEGINNING
Earl y goldsmiths were paid to look after the gold people used as currency, but it was too heavy to carry around in any bulk, like the gold used to pay mercenary armies. (They almost all were mercenaries – it was a pretty good job).
It soon became evident that the owners of the gold in the vaults very seldom even looked at it let alone came after it, so the goldsmiths became bankers in the sense that they lent money out – at interest, the money being letters of credit to the effect that the bearers of the credit notes did have that gold in the vault.
Because the owners of the gold did not physically use it, the goldsmith / bankers soon learned that they could lend out more paper money than there was in gold in the vaults. A t interest, also backed by a fraction of the gold in their vaults
So very early on, the goldsmiths (now moneylenders or ‘banksters' as we call them today) discovered this wonderful benefit rising from the neglected gold in their vaults: They could lend out a lot more than the gold was worth and charge interest on money that did not even exist, the first ‘fiat money' backed by just a fraction of the actual amounts of gold in reserve – I repeat that for emphasis.
FR A CTION A L B A NKING WITH A PRINTING PRESS
Today, this is known as ‘fractional banking' and practiced by all western banks, at about eight to one – for every pound or dollar ‘borrowed' from the privately owned for profit Bank of England or the privately owned for profit Federal Reserve Bank, smaller banks lend out eight at whatever interest the market will bear, which today is zero because of those predatory lending practices, ‘bailouts' and money hoarding.
So it's easy to understand the consequences of a default – every dollar in default represents eight dollars that are now unavailable for further lending.
Banks also raise ‘real' money by selling paper, in A merica known as Treasury Notes, ‘dollars' which today most nations use as the ‘official' trading currency.
The dollar has become the benchmark currency of the west, i.e. up until the emergence of the Euro, the US Dollar has been the only currency with which it was possible to buy oil – Iraq threatened to create a Euro bourse, sell oil outside the fiat dollar system and look what happened to them, Lincoln, Kennedy (and Google ‘Friends of Clinton' for a more recent list).
But as you read this the tide against the dollar is turning; China is buying every scrap of gold (and copper) it can. A nd buying it with the one point nine trillion US Treasury Notes it has been holding for too many years – yes, China is finally dumping the dollar, the first nation to jump out of the world's ‘currency basket', the first to understand what is behind the global meltdown some believe to have been engineered by the owners of the western banking system and the United States government.
(Incidentally, the Vatican in early 2009 suggested that the west take a look at Islamic banking practices, which forbid usury and compound interest).
The global meltdown can be seen in the light of the many and various complications (leveraged derivatives are some) of the concept of good old Judeo-Christian usury.
But first we have to understand a basic concept of economics – not difficult, just a new way of seeing how stuff works, like Heidi's bar.
THE HIDDEN H A ND : POPUL A TION EXP A NSION
From the beginning of the Industrial Revolution, western populations grew at a rate that guaranteed growth (and profit) each and every year until the population started to level out: in the early fifties: Zero Population Growth (ZPG) a phrase not bandied about by western economists.
By the fifties growth itself had quite naturally become embedded in the Capitalist system, so when the growth driver – population expansion – leveled out, creativity was forced into the system in order to continue to ‘grow' profits for shareholders who weren't really interested in the sociology of populations.
From the fifties to the seventies, Tim e and Motion ‘experts' (the first outside business consultants) crammed the workplace and its workers into extreme efficiency programmes, followed in the eighties by computers plugged into factory floors 24/7 which saw some ten million middle managers exiting stage left to the courageous, you're-on-your-own world of small, medium and micro enterprises.
Then followed the era of murders and acquisitions, hostile takeovers, unbundling and fire sales, all to show a heftier bottom line than last year sans original driver.
Today, Capitalism is out there putting Nike shoes on Third World terrorist feet, the only growth sector left.
It had to end somewhere.
What is left out of your lexicon however is not only the fact that the Military Industrial Complex, the system owned and run by the ruling party as it were, is a separate economic structure from the one you and I live and work, but is unaffected by any bottom line requirements.
It is basically a resource economy in that whatever ruling party is on top owns and controls all the resources it needs to function – men and materials, land, oil, coal, water, food crops, farming, everything and protects them with an appropriate force of arms reckoned by its strengths, weaknesses, threats and opportunities to broaden the base of its resources (which calls into question the famous ‘South A frican A rms Deal' – was it appropriate in these terms or just a politically convenient fiat leverage?)
The Ruling Economy, after sustaining itself, then sells its remaining resources into the fiat economy, the one in which we live, work and pay taxes.
If food runs short, though, the lords of the Ruling Economy are the last to go hungry but will need protection from the hungry, creating a basis for contract.
A ROM A N B A ILOUT TWO THOUS A ND YE A RS A GO
To get this into perspective, I'm going to take you back to 29 A .D. when Nero was the Emperor of Rome, the ruler of Rome 's military industrial complex, and by the Lord Harry the fiat economy outside that complex had some serious economic problems that you may perhaps find familiar in today's context.
Remember that the fiat currency in Roman times was gold and other metal coins that could be carried around in a pocket or pouch, while large amounts were paper credit notes ‘backed' by large amounts gold or silver in a goldsmith's vault.
In the Hebrew books of Exodus and Leviticus the ban on usury is thought to be applied exclusively to loans to the poor and the sick, while in Deuteronomy , it extends to all loans, excluding trade with foreigners (Goyim) .
The word 'foreigner' is interpreted in general as 'enemy' and, armed with this text, Old Testament Jews employed usury as a weapon, as other people's needs could be transformed into submission by debt, like today.
Tacitus' A nn als are a true Investigative Journalist's account of a Roman bailout in A .D. 29.
Today's ubiquitous mantra, “if we do not learn from history, we are doomed to repeat it,” bears some examination, and the opportunity to do so came through a small magnifying glass focused on Tacitus, given to me by my friend Graham Lin scott a South A frican political and financial writer of some note.
I have and always will maintain that most of mankind's troubles derive from greed, and usury is indeed its ultimate tool.
Rome , in its later years, was a hotbed of conspiracies and intrigue that went on and on in orgies of sex, murder and destruction from its outskirts to the Senate chamber, “the land,” according to Tacitus, “bathing in a sea of blood.”
This excerpt, taken in context, is but a brief interlude in a catastrophic carnival of chaos, bloodshed and treachery, a pause in the Roman resource-based economy just to ‘fix the (fiat) system' after which the blood returned to the streets of Rome – and ‘life' carried on.
Tacitus' financial interlude is halfway through Book 6 of the A nn als, and is a parenthesis in his description of Rome's long, grinding collapse during that period, which echoes the mantra I mentioned about fools and their money, to which I can only add this codicil: If we forget the pain inflicted upon us by the same perpetrators (thieves who part us from our fool's gold) over and over again, by the same means then we are doomed to be destroyed again by the same instruments wielded by the same perpetrators, again and again. A nd, so far, we have.
Herewith and without further ado: A n excerpt from Cornelius Tacitus' “The A nn als of Rome”, Book 6:
“Meanwhile a powerful host of accusers fell with sudden fury on the class which systematically increased its wealth by usury in defiance of a law passed by Caesar the Dictator defining the terms of lending money and of holding estates in Italy , a law long obsolete because the public good is sacrificed to private interest.
“The curse of usury was indeed of old standing in Rome and a most frequent cause of sedition and discord, and it was therefore repressed even in the throes of a less corrupt morality.
“First, the Twelve Tables prohibited anyone from exacting more than 10 percent, when, previously, the rate had depended on the caprice of the wealthy.
“Subsequently, by a bill brought in by the tribunes, interest was reduced to half that amount, and finally compound interest was wholly forbidden.
“ A check too was put by several enactments of the people on evasions, which, though continually put down, still, through strange artifices, reappeared.
“On this occasion, however, Gracchus, the praetor, to whose jurisdiction the inquiry had fallen, felt himself compelled by the number of persons endangered to refer the matter to the Senate. In their dismay the senators, not one of whom was free from similar guilt, threw themselves on the emperor's indulgence.
“He yielded, and a year and six months were granted, within which everyone was to settle his private accounts conformably to the requirements of the law.
”Hence followed a scarcity of money, a great shock being given to all credit, the current coin too, in consequence of the conviction of so many persons and the sale of their property, being locked up in the imperial treasury or the public exchequer.
“To meet this, the Senate had directed that every creditor should have two-thirds his capital secured on estates in Italy .
“Creditors however were suing for payment in full, and it was not respectable for persons when sued to break faith. So, at first, there were clamorous meetings and importunate entreaties; then noisy applications to the praetor's court, and the very device intended as a remedy - the sale and purchase of estates - proved the contrary, as the usurers had hoarded up all their money for buying land.
“The facilities for selling were followed by a fall of prices, and the deeper a man was in debt, the more reluctantly did he part with his property, and many were utterly ruined.
“The destruction of private wealth precipitated the fall of rank and reputation, till at last the emperor interposed his aid by distributing throughout the banks a hundred million sesterces, and allowing freedom to borrow without interest for three years, provided the borrower gave security to the State in land to double the amount.
“Credit was thus restored, and gradually private lenders were found, (but) the purchase … of estates was not carried out according to the letter of the Senate's decree: Rigour at the outset, as usual with such matters, becoming negligence in the end.
”Former alarms then returned, as there was a charge of treason against Considius Proculus: While he was celebrating his birthday without a fear, he was hurried before the Senate, condemned and instantly put to death.”
So there you have it: The trivial financial problem in the fiat economy had been resolved by minting gold sesterces from resources available to the Ruling Economy and things returned to normal in A ncient Rome.
Which brings us into the context of today's meltdown and why South A frica stands perhaps just a little bit aside from the totality of the financial collapse of Capitalism in the Rest Of The World.
Quite simply, today's resource-base governments are and have been in bed with the bankers for over three hundred years – the Roman government just took its eye off the regulatory ball but was not wholly complicit with the exception of most of the Senate.
UNIFIED FIELD THEORY
A n answer may perhaps lie with my A lmost Unified Economic Field Theory, Constantly Under Revision: Revision being the polish I put on the economic apple that just recently fell on my head – (We'll have some apple pie with lunch, served up after the baked bankers.)
The Blame A llocation going down among the financial journalists and pundits today, “Bring out the pitchforks, tar, feathers and rope, give us Greenspan and Bernanke, Madoff and the rest” is a remnant of a Victorian Working Class family structure, from which everyone knew to get far, far away and hide.
BOOM -BUST BY DESIGN
This ‘meltdown' is current history and all of that which I've mentioned can be checked, challenged, researched and then wept over. Because it is the proof that we have been parted from our money once again.
It is history cast in three centuries of stolen wealth:
On average, every forty-six years, for the last three hundred years (the lifespan of Capitalism), since the collapse of the South Sea Bubble in the first decade of the1700s there has been a commodity peak in the world's stock markets, followed by a crash, followed by a depression (and the theft of a generation's wealth.)
(The above statement is paraphrased from "The Great Reckoning" by James Dale Davidson and William Rees-Mogg, Sidgwick & Jackson, published, yes, in 1993, when by then we should have known).
Theft is my interpretation of their observation of these last six events because once is an accident, twice is a coincidence, three times is a Declaration of War.
Four times is the realization that the Declaration fell on the deaf ears of sleeping fools, five times is simple daylight rape and plunder of the same fools – the sixth time, this time, Grand Theft, Planet © , is perhaps, hopefully, a lesson finally learned, and we wake up?
There is a nine-year gap between commodity peaks and market crashes over the last five generations. A dd forty-six years to that (the average number of years between peak and crash) and you have a boom-bust cycle twice every hundred years or once a generation, meaning every generation of working and middle-class citizens, for the last three hundred years has been good and truly and thoroughly plucked:
- First Tim e: Commodity prices peaked in London in 1711 (Long before A merica came into the economic picture). The South Sea Bubble burst exactly nine years later in 1720.
- Second time: Producer prices peaked in London in 1763. The London stock market crashed again in 1772 (nine years later).
- Third time: Commodity prices peaked in London in 1816.The London stock market crashed in 1825 (nine years later).
- Fourth time: Wholesale prices peaked in New York in 1864. A worldwide assets crash began in May 1873 (nine years later).
- Fifth time: Then followed our beloved Great Depression in the 30s, about which much has been said, from which, little learned.
* Sixth time: Commodity prices peaked some fifty years later in Tokyo , in 1980. The Tokyo stock market crashed in 1989 (again, nine years later). The depression following that crash is now upon us.
Look around you and do the math: The last depression is called The Great Depression.
I call this one ‘Grand Theft Planet' ©.
Loaded Question: Given that (our only scapegoat for this planetary theft) Bernie Madoff, having uttered a guilty plea, will not be tried in a court of law, the question, “where is the money?” will not arise and there is every possibility that the A merican government will reimburse his victims.
If, however, Madoff were head of just another finance company that went belly up after years of the A merican Security Exchange Commission's ( SEC ) awareness, and was tried, it would be tough on his investors, but we might have found out where the money went and why his guilty plea was accepted.
Leave it hanging.
It is interesting to note that all six of these depressions, including this one, were bracketed by expensive wars, all sides of which were funded by the same families of bankers. This Grand Theft Planet, the sixth Depression, is in the middle of an extremely expensive and aggressive A merican Imperial military expansion.
“New A merican president Barak Hussein Obama's restoration of all of the most notorious Bush Era policies and the appointment of Bush's most brutal commander (General Stanley McChrystal), is based on his total embrace of the ideology of military-driven empire building. Once one believes (as Obama does) that US power and expansion are based on military conquests and counter-insurgency, all other ideological, diplomatic, moral and economic considerations will be subordinated to militarism. By focusing all resources on successful military conquest, scant attention is paid to the costs borne by the people targeted for conquest or to the US treasury and domestic A merican economy. This has been clear from the start: In the midst of a major recession/depression with millions of A mericans losing their employment and homes, President Obama increased the military budget by 4% - taking it beyond $800 billion dollars.' - Prof. James Petras, Global Research, 17 May, 2009
"Fighting in a city is probably the most complex environment for military operations. It has been compared to a knife-fight in a telephone booth. Casualties in the average rifle company can run as high as 30%." -- General William Kernan, head of the U.S. joint forces command
Change is essential to the development of any thinking and most progress in this world is made by lazy people looking for easier ways to do things.
‘ A new idea is first condemned as ridiculous and then dismissed as trivial, until finally, it becomes what everybody (already) knew' – William James, brother of novelist Henry.
Here then is not a new idea, but an idea of which you are already fully aware.
I call it my General Field Theory of Economic Behavior, for lack of anything more worthy, simply because no economic thinking that I am aware of has ever been applied to this repetitive global economic behavior ('boom-bust cycles' which also seem not to have been pointed out or examined by other historian except in passing)
So in this light – all studies, observations and theses seem to have been just that, theories – from Smith's "hidden hand" to the Laizer-Faire A ustrians, to Keynes' "use The Hand to fiddle with the system" – theories.
Nothing more, and certainly never applied to the real world of actual economic behavior in the marketplace where I gamble on the future prices of corn, pork bellies, sorghum, potatoes, grapes, oranges and sometimes antique collectables called Credit Default Swaps.
A s far as I know there have been no attempts in universities or in any other similar think tank type establishments at an understanding of the how of which in a million ways people complicate the use of money and, again which, until now, remains a field that appears to be unseeded, untilled and unharvested, yet terminally exploited once a new generation has accumulated some more wealth.
Until this observation of mine opens it, hopefully, to at least some gleaning.
Economic literature is much like the literatures of psychology where ‘Freudian' theory , 'Existentialist phenomenological' theory , make people think that there is substance in the reduction of speculation to the written word.
Nothing wrong with theory, of course; so, having boarded the train as it were (there will be Nando chicken later in the South A frican section of the dining car), this, like any other uniform ‘theory', my General Economic Theory has to apply to every aspect of the complications people can possibly make in the use of money.
A nd it has to be just as simple as E=Mc 2 :
A nd it is: Money = Food.
From Peasant to Prince: In all of history, food must be on both tables for any society to function.
Now, I could go on at length here (I'm good at it) but will not go into discussions involving philosophy, politics, religion, and then argue for some time in every one of those categories and more.
I couldn't, you see, do it for too long for without a good breakfast and a cuppa, dear, also without which you will not be capable of rebuttal however unintelligent my arguments might seem to you.
CONTROL THE OIL A ND YOU CONTROL THE G0VERNMENT, CONTROL THE FOOD A ND YOU CONTROL THE POPUL A TION – Henry Kissinger, circa 1970, author of the phrase, “Useless Eaters.”
A ristotle's belief that touching was required for one object to exert a force on another object together with his ideas that a constant velocity requires that a constant force be exerted held back ideas of gravity for nearly 2000 years!
Yup. Gravity does not ‘touch' you, so a great philosopher's thinking actually held back the arrival of a great truth – Newton 's theory of gravity – for two thousand years.
A nd so Usury has kept a scientific approach to the distribution of wealth - food on everyone's table – from the people for about the same number of years.
So: Life equals energy, which equals matter multiplied by the speed of light squared, a truth that arrived about a hundred years ago in the mind of one Mr. A lbert Einstein, who also observed (since this is my opening salvo on economic reality) that “the greatest force in the universe is compound interest.”
Hold that thought.
B A CK TO THE FUTURE
Einstein's theory of gravitation was completely different to Newton 's, and certainly in opposition to A ristotle's: Rather than believing gravity to be a mysterious force that simply attracted objects towards one another he saw gravity as a warping of the shape of space and the flow of time (the space-time continuum).
He described a gravitational field as a curvature of space-time caused by the mass inhabiting that continuum.
He also believed that as energy is equivalent to mass (from E = mc 2 ) it would be possible for a gravitational field to interact with the energy of light in the same way that he saw it interacting with mass, with the result being the bending of light in strong gravitational fields all of which were relatively congruent.
Two physical, abrupt, observable and applicable functions of Einstein's Theory of Relativity were:
Hiroshima and Nagasaki .
So what has held back the idea that general wealth is available with our Garden of Eden resources?
A gain, Usury: Compound interest.
A simple idea that has kept general wealth from everyone in every nation for thousands of years
A nd Usury – the financial Hiroshima – Is still blowing people up, societies and whole countries: The A merican Bill HR 835 before the House in early 2009 actually seeks to prohibit A mericans from growing their own food or buying food from garden markets because that food has not passed the ‘stringent' requirements of the Food and Drug A dministration – Mint tea is a drug, Potatoes Can Be Harmful To Your Health. It's really out of hand.
Money is much simpler than Relativity, but should not blow us up, but for how much longer can we be fools and let this sort of behavior part us from our wealth?
It's been systematically stolen from us every fifty years or so – then it accumulates again through our work “The basis of all wealth” because the victim generation somehow 'forgets' to tell the next one about usurious debt: the result of illegally forcing compound interest on innocent civilians (or the Ruling Economy taking its eye off the ball if it is not complicit).
This is being written – with many comments and criticisms expected to come screaming at me as I shout, ‘J' A ccuse' at Capitalism – with the idea that the next generation, the one we will not allow to suffer another Grand Theft Planet ©. because its population – we will no longer be here - will finally be educated and know how to hold on to wealth.
Money equals the solar energy contained in food in one sense, but it is really just a vehicle of transaction from one state of energy to another state.
Everything else money is used for that does not walk on a direct path from the peasant farmer's produce to the Priest / Prince who eats that farmer's wealth, is speculation on the nature of money which, by itself, is nothing more than a temporal transactional smoothing substance equivalent to a good lubricant – and, because “you can't take it with you” it's essentially worthless, especially if one agrees that the most valuable thing you can own is your next breath.
Food is everything.
Carbon dioxide is the food of our food, the plants we eat absorb carbon dioxide and feed us oxygen; 'global warming' is just another scam to take some of your wealth in 'carbon taxes'.
In support of this, please read what remains of Hammurabi's Code.
A nd then, in the light of Hammurabi's contribution to my theory, maybe reconsider the Ten Commandments for a good laugh – except the one that says, ‘thou shalt not steal'.
A nd then, with those two suggestions in mind, think about this: The Law we live under today is based on one, and only one, principle - embedded in Hammurabi's Code, the one of the applicable one of the Ten Commandments and in today's harsh remnants of Roman Dutch law: it boils down to the reality of living:
"Thou shalt not interrupt the chain of commerce that brings the farmer's produce – our collective daily wealth – to the prince's – and our, tables."
That is the fundamental law of economics.
A nd the artificial 'gravity' that makes us not obey that fundamental rule, instead the harsh and oppressive rules of Capitalism? Two French words: ‘Mort' (death) and ‘gage' (cage).
“It's just the way it is”: You are born, go to school, grow up, and, on average, at about twenty-five years of age, get married and buy a house in which to raise the children of the next generation.
It just happens that ‘society' has arranged it so that you need twenty years during which to pay for your house, which leaves you ‘debt-free' (unless you've maxed out your credit cards) and you are forty-five years old.
Those twenty years were the best, most productive years of your life and, today you will find yourself very lucky to have a sustainable pension.
The wealth from your work went directly into the capitalist lending system.
E=mc 2 .
COULD SOUTH A FRIC A BE THE FIRST RESOURCE-B A SED, EQU A L DISTRIBUTION ECONOMY A FTER THE GR A ND THEFT, PL A NET MELTDOWN?
One legacy of the A nglo / A frikaans economic thinking still holding in South A frica is that our banking system is still well-regulated, our S. A . Reserve Bank is, unlike the privately-owned Bank of England and The U.S Federal Reserve Bank, owned and regulated by the South A frican government (which, so far, has kept its eye on the ball) and therefore belongs to the people.
Because of S. A . Forex regulations, South A frican banks were not overly exposed to the ‘toxic sub prime derivative assets' that were sold all over the planet by the A merican banking, savings and loan and insurance institutions.
What needs to be done now is for the present South A frican government – and any others who wish to choose to do so, to examine the means to a transition from usurious Capitalism to resource-based economies dedicated to a fair and even distribution of the people's share of basic resources, commonly owned, paid for with interest (Greenback) government money: We will all have to work, but should all be rewarded fairly.
I believe that the pursuit of happiness is an inalienable right and should be helped, not hindered.
A large portion of the above work is from the thinking of the extraordinary and admirable Stephen Zarlenga, The Lost Science of Money ( A merican Monetary Institute, 2002, a monumental 736-page book that shows how money has served socially beneficial purposes throughout history only when created by governments as an instrument of law and not as the private preserve of the rich, the Global Research Institute .. . pi eces of their writings including portions of Zarlenga's speech to US Treasury staff in 2003 and 2009 along with other work mentioned below – and blended into this piece
A lso included are some original thoughts from Bob Blain's work and an excerpt from Sam Smith's “Great A merican Political Repair Manual”, published by WW Norton in 1997.
A gathering thought from Ronnel Zabora Bird's what I call ‘blame-game' piece, ‘Fallen Heroes' was paraphrased from the A pril – May, 2009 edition of KwaZulu Natal's Business Life.
A final thought from Zarlenga, “The money system is society's greatest dispenser of justice or injustice. A good one functions fairly, helping create values for life. A bad, unjust one obstructs the creation of values; gives special privileges to some and disadvantage to others causing unfair concentrations of wealth and power; leading to social strife and eventually warfare and a thousand unforeseen by most people, including ‘economists', but nevertheless totally predictable! bad consequences - physical and spiritual.” (Italics mine - t.d.)
I thank you for joining me on this short journey through a deliberately one-sided history of theft – hoping that what I left out should raise the questions necessary for us to proceed with the creation of a society based on equally shared resources of this planet we share and collectively own.
The Roman Empire ultimately dissolved into what we now call Europe leaving the lovely legacy of ‘Romance' languages, Roman history and Roman laws still extant, such as my favourite cap on usury, the ‘ In Duplum Rule' , added to by, of all thinkers, the sturdy and implacable Dutch .
Why no historian has brought to the attention of the public mind or brought into general knowledge is the fact that not only has war always been a factor in the economic history of mankind, but that we cannot afford it.
Wars have to be financed.
You will find on any examination of historical fact that each and every boom-bust-cycle was bracketed by a very profitable war.
I did mention the A merican Civil War and A braham Lincoln's interest-free Greenback Dollar, opposed by the banking system of the day.
You will also find that those wars were financed by the people who controlled and, upon close examination, engineered the boom-bust cycles, who also lent money to both sides of every war, who also then collected money from both sides after every war, with interest, for as long as Capitalism has been imposed upon and ruled the people of the western world.
I call it a conspiracy. It is.
That there are (possibly opposing) groups of human beings who, however connected, control other financial structures of the planet's economies, is beyond any doubt.
The evidence is before you and I hereby rest my case.
Ron Paul (Rep, Texas ) 19 May, 2009 : Could it all be a bad dream or a nightmare? Is it my imagination or have we lost our minds?
It's surreal, it's just not believable.
A grand absurdity, a great deception, a delusion of momentous proportions based on preposterous notions and on ideas whose time should never have come.
Simplicity, grossly distorted and complicated.
Insanity, cast off as logic.
Grandiose schemes built on falsehoods with the morality of Ponzie and Madoff.
Evil described as virtue.
Ignorance pawned off as wisdom.
Destruction and impoverishment in the name of humanitarianism.
Violence, the tool of change.
Preventive wars used as the road to peace.
Tolerance delivered by government guns.
Reactionary views in the guise of progress.
A n empire replacing the republic.
Slavery sold as liberty.
Excellence and virtue traded for mediocricy.
Socialism to save capitalism.
A government out of control, unstrained by the constitution, the rule of law or morality. Bickering over petty politics as we descend into chaos. The philosophy that destroys us is not even defined.
We have broken from reality, a psychotic nation. Ignorance with pretence of knowledge replacing wisdom. Money does not grow on trees, nor does prosperity come from a government printing press or escalating deficits.
We are now in the midst of unlimited spending of the people's money. Exorbitant taxation, deficits of trillions of dollars spent on a failed welfare-warfare system. A n epidemic of cronyism. Unlimited supplies of paper money equated with wealth. A central bank that deliberately destroys the value of the currency in secrecy, without restraint, with nary a whimper, yet cheered on by the pseudo-capitalists of Wall Street, the military-industrial complex, and Detroit .
We police our world empire with troops on 700 bases and in 130 countries around the world. A dangerous war now spreads throughout the Middle East and Central A sia . Thousands of innocent people being killed, as we become known as the torturers of the 21st century.
We assume that by keeping the already known torture pictures from the public's eye, we will be remembered only as a generous and good people. If our enemies want to attack us only because we are free and rich, proof of torture would be irrelevant.
The sad part of all this is that we have forgotten what made A merica great, good and prosperous. We need to quickly refresh our memories and once again reinvigorate our love, understanding and confidence in liberty.
The status quo cannot be maintained considering the current conditions. Violence and lost liberty will result without some revolutionary thinking. We must escape from the madness of crowds now gathering.
The good news is that reversal is achievable through peaceful and intellectual means, and fortunately the number of those who care are growing exponentially.
Of course it could all be a bad dream, a nightmare, and that I'm seriously mistaken, overreacting, and that my worries are unfounded. I hope so. But just in case, we ought to prepare ourselves for revolutionary changes in the not-too-distant future.
"Specie is the most perfect medium because it will preserve its own level; because, having intrinsic and universal value, it can never die in our hands, and it is the surest resource of reliance in time of war." --Thomas Jefferson to John Wayles Eppes, 1813. ME 13:430 *
( A silver dollar that contains about a dollar's worth of silver is specie money.)
"Paper is poverty, ... it is only the ghost of money, and not money itself." --Thomas Jefferson to Edward Carrington, 1788. ME 7:36
"Experience has proved to us that a dollar of silver disappears for every dollar of paper emitted." --Thomas Jefferson to James Monroe, 1791. ME 8:208
"It is a [disputed] question, whether the circulation of paper, rather than of specie, is a good or an evil... I believe it to be one of those cases where mercantile clamor will bear down reason, until it is corrected by ruin." --Thomas Jefferson to John W. Eppes, 1813. ME 13:409
“ Classical/neoclassical economics has consistently protected the wealth of the privileged; it has preserved the status quo. This is capitalism's intent, and the evidence for it is overwhelming. It has impeded the improvement of the human condition for (three) hundred years, and unless it is scrapped, it will continue to do so, like the impediment of the knowledge of gravity. No mere change in government can stop it. – Global Research Institute.
The Wharton School of Business in a (May 2009) essay on the psychological causes and solutions to the economic crisis … points out that restoring trust is the key to recovery, and that trust cannot be restored “until wrongdoers are held accountable.
“So far, Obama, Summers, Geithner, Bernanke and crew have tried to paper over the cause and severity of the financial crisis, instead of honestly addressing them. They haven't lifted a finger to hold anyone accountable (other than a Madoff or two), but have actually thrown billions of dollars at the perpetrators, or else appointed them to government posts.”
“What is not said in this searchlight on economic history is what makes the mind's eye snap wide open” - Richard Tom linson.
"The Revolution Will Not Be Organized "
The revolution will not be organized,
the revolution will not be organized.com,
the revolution will not be Yahoo Grouped, Meetuped,
downloaded, uploaded, QWERTY'd, or blogged.
The revolution will not be handled by webmasters,
think-tankers, authors of policy position papers,
authors of anti-policy position papers,
secretaries, executives, executive assistants,
insiders, whistle-blowers, informants, counter-informants,
committees or sub-committees.
Your neighbor with excellent leadership qualities
will not lead you into, through, or out of the revolution.
The revolution will not be inspired, instigated, managed
or controlled by him, her, or them.
The revolution will not be organized.
No matter if you eat at Mc Don ald's and can barely walk,
no matter if you drive an S.U.V. and rarely walk,
no matter if you were public school indoctrinated,
vaccinated, humiliated, ostracized, terrorized, minimized,
no matter if you live in a house owned by Bof A ,
no matter if you eat cat food, dog food,
Puppy Chow for your inner child,
no matter if you shop at Salvation A rmy, Saks, TJ Maxx,
when the Cold Hand of Power touches you,
it touches revolution.
They will come to chip you, rape you,
tell you you are theirs, imprison you in FEM A camps
because you spoke out,
because you doubted the official story,
because you looked with your own eyes,
spoke from your own heart.
They will come for you in black uniforms, black helmets,
swinging black batons, symbols of the New A uthority,
and you will say,
"No, my children and I will not come with you."
You will say no -- not because Charlie Sheen
inspired you one night on FOX News
to look more closely at falling towers.
You will say no -- not because A lex Jones
led you through the darkness with a bullhorn.
You will say no -- not because Howard Zinn
handed you the Book of Truth on a silver platter.
You will say no because you are your own
star of truth shining the way.
At your unique hour, in the dark,
beneath a burning paper currency moon,
the Cold Hand of Power will touch you and revolt you.
At your unique hour,
when they come for you because you asked questions,
because you did not lower your eyes,
because you did not bow down,
at your unique hour,
in your unique circumstance,
you will find yourself in the grip of a courage
you have not known but which you are.
You will stand in front of black helmets with invisible faces,
and you will say,
"No, my children and I will not come with you."
Daughters and sons of revolutionaries,
blood burning for freedom,
eyes set toward tomorrow,
each of you alone in the darkness,
beneath tender constellations burning gold and silver,
each of you will remember the path to take
when the Cold Hand of Power comes for you,
each of you will make your way without direction or encouragement,
as those before you made their way without direction or encouragement,
forging history, embracing destiny.
You will not march in file.
You will not march.
The revolution will not be organized.
In your darkest hour,
beneath the burning moon,
you will pledge allegiance to the truth,
as those before you pledged allegiance to the truth.
The truth cannot be organized.
"The Revolution Will Not Be Organized"
written on September 24, 2008 by
"The wise win without a fight, while the ignorant fight so that they can win." - Sun Tzu
"Examiner Editorial: Get Ready for Obama's Coming Hyperinflation," San Francisco Examiner , A pril 29, 2009 .
Martin Hutchinson, "Is It 1932 – or 1923?", Money Morning ( A pril 9, 2009 ).
See Monthly A verage Graphs, x-rate.com.
Stephen Zarlenga, The Lost Science of Money ( Valatie , New York : A merican Monetary Institute, 2002), pages 590-600; S. Zarlenga , " Germany 's 1923 Hyperinflation: A 'Private' A ffair," Barnes Review (July- A ugust 1999).
Henry C. K. Liu, "Nazism and the German Economic Miracle," A sia Tim es ( May 24, 2005 ).
S. Zarlenga, op. cit .
Matt Koehl, "The Good Society?", Rense ( January 13, 2005 ).
"Bags of Bricks: Zimbabweans Get New Money – for What It's Worth," The Economist ( A ugust 24, 2006 ); Thomas Homes , "IMF Contributes to Zimbabwe 's Hyperinflation," www.newzimbabwe.com ( Marc h 5, 2006 ).
Jim Sinclair, "Fed A ctions a Bandaid on a Gaping Economic Wound," reprinted in Go for Gold , September 18, 2007 .
Eliot Spitzer, "The Real A IG Scandal, Continued! The Transfer of $12.9 Billion from A IG to Goldman Looks Fishier and Fishier," Slate ( Marc h 22, 2009 ).
See Ellen Brown, "Cash Starved States Need to Play the Banking Game," webofdebt.com/articles ( Marc h 2, 2009 ).
My final reference: