Tag Archives: Odious Debt

Grenfell Tower: Murder by ‘Austerity’

It is a week since we witnessed the horror of this human tragedy. It seems that since the Great Fire of London in 1666, successive governments have limited their concern for providing safe and secure habitation for the people under their care.

Grenfell Tower is a frightening indictment of political, financial and religious doctrines that are now no longer fit for purpose.

We live in an era of ‘professional’ politicians who, in leadership roles, care more about their power than the people. Our current Prime Minister initially ignored the survivors of this tragedy and then, urged by her advisors I am sure, sickeningly gushed over the families of victims of a terrorist attack just days later.

They are servants to global corporations who finance their election efforts and hence the continuing low turnout from voters, who know they are now limited in ability to sway political opinion.

Our financial system too, is outdated and in chaos. Every single aspect of the Grenfell Tower horror, from the blazing building to the rescue services (who did superbly), were affected by lack of financial resources and dwindling budgets.

‘Austerity’ is not a financial discipline, (to show we are being prudent), but a tool by which financiers can grab sovereign assets cheaply. We have seen this in Greece, where everything from their beautiful islands to even their water supplies have been sold off to private interests at knock down prices. This, from odious moneylending practices that create unrepayable debt and sovereign servitude – the very essence of how and why ‘Austerity’ is implemented.

Creating money is simplicity itself. When you and I take out a loan no money changes hands! A computer entry is placed in your bank account for say, £1,000 and a similar entry is placed in the banks account, showing that loan as an asset to ‘balance’ the books. No gold has been sold. No cash has been taken out of the banks vaults. It is simply created out of thin air, which we then pay interest on.

‘Austerity’ becomes a sordid joke as the amount of money put into the economy is dictated by the private banks, who have been authorised by government to run this very lucrative and controlling function of Society. Any amount of money can be supplied to Society but the banks only allow sufficient to keep us in permanent debt to them.

For evidence look at the trillions of Q E printed by the Federal Reserve in the US and the ECB in Europe and passed directly to banks to buy their bad debts, (created by lending money to people they knew could not afford to repay). That money bypassed Society, who were forced into the type of ‘Austerity’ measures that caused the horror of Grenfell Tower.

In Germany and other countries there are public banks, run by the local authorities who support small businesses and their community infrastructures – Health, Education, Police and Fire services etc. No wonder Germany is financially strong and why the ECB want to close them down and transfer their services to private banks.

Finally, in the past our traditional religious establishments have been responsible for the moral fibre of Society. In my lifetime, these values and power have been eroded by the growing worship of money and what it can buy, eroding integrity and moral fibre in the process.

The loss of power and influence of Western religions, in my opinion, reflects their inability, or desire, to bring their beliefs into the 21st century to reflect the world in which we now live. This failure, in turn, has diminished their ability to exercise any integrity and moral fibre over how our political and financial institutions do business.

This erosion of morality has resulted in the horror of Grenfell Tower. It highlights how ‘money’ desperately needs cheap labour but refuses to then take responsibility for looking after that labour, through the conduit of political policy and action which it so heavily influences.

We are in a whole new (global) world now, where antiquated taxes, political practices and a wholly unsupportive financial system* can be seen to be hopelessly out of place in serving Society’s needs.

What I am now looking for is a political party who can ‘repackage’ this country, by providing an infrastructure that supports the efforts of business as well as the community, providing transport infrastructures, premises, employees (as well as Health, Education and Community services for their employees, retirees and their families).

That infrastructure has to be paid for and that must come from creating public banks to service local authorities, together with a whole new tax system that ignores where a company’s headquarters are based but instead charges that corporation each time it uses our country’s facilities.

A ‘Transaction Tax’ that they and their customers pay on every financial transaction, from buying a hairpin to making a derivatives trade. Nothing is excluded because ALL use the infrastructure to make that transaction, in one format of another. You Use It . . . You Pay – no matter where you live and work from!

We need leaders with this sort of new vision, which addresses the many abuses Society increasingly face with current 18th century thinking. They must address global warming, the education and future of our young (do they have one anymore) and an ageing Society that has given us its support and now requires our support in return. Above all, they must urgently address the impact of IT upon future employment and create new employment opportunities for our young.

Society is getting more and more angry with each passing abuse that comes to light and that anger is waiting to be converted into the means by which we build a new and more caring Society.

Are there people out there who want to use their power to this end? Society is in desperate need now, to avert another Grenfell Tower.

 

Until the next time.

*This paper by Professor Richard A Werner D Phil (Oxon) University of Southampton – ‘Do We Need Central Banks’ – takes apart the global financial system in a comprehensive manner I have not come across before: https://professorwerner.org/shifting-from-central-planning-to-a-decentralised-economy-do-we-need-central-banks/

Capitalism . . . Creator of Poverty

The great enemy of the truth is very often not the lie — deliberate, contrived and dishonest — but the myth — persistent, persuasive, and unrealistic.” – JFK

According to one of my financial heroes, Bill Bonner, money is not wealth. It simply measures wealth like a clock measures time. Wealth is what has been produced, is made available and that which you can buy with money.

When banks print money out of thin air it is like adding an extra hour to a clock. It doesn’t make time any bigger, it simply distorts it and disorients the observer. What counts with money is that it is honestly made available to purchase goods and services. Honest money cannot be separated from the real economy where those goods and services are produced.

Say’s Law offers the wisdom that “You buy products with products . . . not pieces of paper.”

QE in the US, Europe and Japan is following Zimbabwe in separating money from the real economy. Trillions of dollars have been printed that mislead everyone into thinking they are wealthy, until they see the need for a wheelbarrow full of this pseudo wealth to buy real wealth – a carton of milk. We aren’t there yet but that is where we are headed!

Similarly, profit is not wealth but merely a measurement of overall business efficiency. When you combine these two illusions you arrive at the curse of the 21st century . . . debt. Debt offers the most efficient means of producing profit, by producing unreal money with few overheads.

With all of this in mind let me give you my perspective on what is going on and remember I’m no economist, but even to my simple mind we are now heading to an almighty financial catastrophe. I will use the car industry to make my point but the principles can be applied across today’s financial world. Continue reading

Banks & IMF Are Out of Control

As a species we are fallible and we recognise this in our attempts to construct laws and regulations which address human weaknesses and flaws. They are by no means complete and human fallibility continues to wreak havoc, more so when those same laws and regulations are removed or neutered by vested interest.

My regular readers will know that one of my hobby horses is the continued abuse of Greece by the Troika, something that is killing innocent Greek people through deprivation and despair. At the heart of this destruction is the IMF and its policy of ‘austerity’ that obligates countries indebted to it to cut social support programmes and hand over sovereign assets at discounted values.

“The organization’s objectives stated in the Articles of Agreement are to promote international monetary cooperation, international trade, high employment, exchange-rate stability, sustainable economic growth, and making resources available to member countries in financial difficulty.”

Further on from this, the frightening scope of its powers are clearly laid out.

Whilst the Fund can “make contracts, acquire and dispose of immovable and movable property and institute legal proceedings” from which nobody is immune, the Fund and its employees “are immune from every form of judicial process” and its assets “free from restrictions, controls and moratoria of any nature.” This includes freedom from any form of personal taxation for all 2400 employees!

With this unprecedented level of unaccountability, the Fund can do whatever it likes. In the case of Greece, it has done precisely this without seeming care or concern, in what has now been described as the ‘immolation’ of Greece. (Merriam-Webster’s dictionary defines immolation as “to kill as a sacrificial victim”, which is the stand I have personally taken over the whole violation of this country.)

This lack of accountability has now been firmly placed in the spotlight, (with similar brutality), after its own internal watchdog, the Independent Evaluation Office (IEO) submitted a report  to the board, (to whom they are solely accountable), which has roundly condemned how the Fund is being run.

Its top level staff have misled and misinformed their own board into becoming the champions of the euro project and which has led to catastrophic misjudgements on Greece. They have also failed to grasp the basic concepts of money theory that ensured they completely ignored the warning signs of an impending crisis within the EU, a ‘serious scientific and professional failure’.

EU insiders have used the fund to rescue their own pet project, with an unprecedented 80% of all available funding being used to bail out Greece, Portugal and Ireland. An ethos of misleading seniors was also extended to the IEO, in its investigations of the activities of “ad-hoc task forces”, where decisions and provision of information remained elusive.

Heads have turned to its managing director Christine Lagarde, who is now to stand trial in France over corruption charges and who has responded to this report with a statement that offers ‘qualified’ acceptance of its contents. Something I interpret as “I hear you” and no more.

This arrogance, by the boss and her organisation, has led to an era of negative interest rates that is devastating savings and the future of pension schemes, whilst ruining the banking system in its wake. Their policies continue without any recovery, or hint of recovery in sight. Here lies the true cancer created by the inbuilt lack of accountability written into the Fund’s Articles of Agreement.

It goes to the very heart of why we need regulations and accountability to guard against the horrific abuses that can occur when human fallibility is not held in check. Millions of people’s lives have been ruined by the mismanagement of this powerful organisation and its independence must surely now be put in question.

And all of this at a time when the European Banking Authority has just conducted a ‘stress test’ across the European banking sector and nobody has failed, nor has anyone passed, as there are no criteria for such assessments.

Instead a rescue package has been put together to stop Italy’s Banca Monte dei Paschi di Siena collapsing and Deutsche Bank, defined by the IMF as “the world’s most systemically risky bank” is being ‘scrutinised’.

Of the 123 lenders covered in the last stress test in 2014 less than half have been covered this time and none of Portugal or Greek banks have been included. Neither will the results of 56 other banks that have taken the tests be published.

Like the IMF, lack of accountability and secrecy reign and beg two questions. Firstly, what was the point of these tests, other than giving the appearance that some form of regulation is being carried out. Secondly, what is the true extent of the fragility of these banks, given the millions of people are dependent upon them for running their personal and business finances.

This last point is even more significant when you consider that the world banking system is a carefully controlled cartel that is not open to competition. Cartels and monopolies offer the very worst of attributes of human fallibility in the unaccountable power and control they provide and a complete immunisation from healthy regulation and governance.

Thatcher and Reagan opened up the financial markets to unlimited growth and power, which has accelerated exponentially in the last 40 years and is now bringing the world to its knees, with an impending financial collapse that will make 1929 and 2008 seem but hiccups.

Only today the man convicted of the UBS £1.4 billion fraud, the biggest in British history, said that “major banks have done little to tackle the culture which allowed him to carry out his crimes”.

Indeed, the Financial Conduct Authority dropped a long-running enquiry into the culture of banking at the beginning of the year, with suggestions that former chancellor George Osborne had exercised pressure on the industry following last year’s surprise election win.

Never has there been the need for the re-emergence of democratically supported political power to bring these financial monoliths back under control. We need regulations that have teeth and can break the conglomerates up and return us to a banking sector that supports the needs of Society and not the needs of the few.

I worry that we hear nothing about the regulation of the financial sector from those seeking political office, either at home or abroad. It was strong leadership that gave them their power and it is that self-same strong leadership that can take it away again now.

Until the next time

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes

‘Austerity’ . . . This Will Kill it!

Are we now seeing the beginnings of the destruction of the financial and corporate world as we know it? If this month’s Finance and Development report from the IMF, no less, is anything to go by, with its headline “Neoliberalism: Oversold”, the writing is certainly on the wall.

Before I go any further let me just offer a couple of official definitions of Neoliberalism so that we are all singing from the same hymn sheet.

  1. A modern politico-economic theory favouring free trade, privatisation, minimal government intervention in business, reduced public expenditure on social services etc. Collins Dictionary
  2. Neoliberalism is a policy model of social studies and economics that transfers control of economic factors to the private sector from the public sector. Investopedia.com

Over the last 30 years or so it has become very noticeable how there has been a gradual erosion of democracy, countered by an escalation in corporate power and unregulated abuse which caused the financial collapse of 2008 and continues unchanged to this day.

Interspersed with this we have been assaulted by ‘Austerity’ measures across the globe and which, it has become increasingly clear, are a device to sell off public assets at a discount to the private sector.

In addition, there has been an escalation in debt originated money supply that has placed governments in varying positions of obligation to financiers. Because of this ‘obligation’, lenders have not only demanded ‘Austerity’ but also increasingly violated the democratic process by ‘quietly demanding that governments go against, or ignore, the wishes of the people.

Both of these abuses were particularly evident in the case of Greek debt. Here a (newly elected) government referendum against continued ‘Austerity’ measures was not only ignored but harsher terms were inflicted, in what appears to be a punishment and to deter any repeat of such action in other debtor countries in the EU and elsewhere.

We have also seen public outrage and demonstration against the odious TTIP agreement, Fracking and in the UK the gradual destruction/privatisation of the NHS. These actions have been equally rigorously ignored/defended by governments and the non-elected technocrats in Brussels, showing a complete contempt for the people who actually pay their wages and expenses.

All of the above, plus a whole lot more, can be laid fair and square at the feet of the application of Neoliberal doctrines, as time is now showing. What time is also demonstrating is that they don’t work and are simply benefitting the already rich, by increasing their wealth exponentially at the expense of the many.

The bombshell this week is that the IMF experts, in the shape of Jonathan D. Ostry, Prakash Loungani and Davide Furceri, are actually confirming what we already know. I quote from the heading of their report

“Instead of delivering growth,

some neoliberal policies have increased inequality,

in turn jeopardizing durable expansion”

The paper goes on to say:

“Austerity policies not only generate substantial welfare costs due to supply-side channels, they also hurt demand—and thus worsen employment and unemployment.”

These findings suggest a need for a more nuanced view of what the neoliberal agenda is likely to be able to achieve. The IMF, which oversees the international monetary system, has been at the forefront of this reconsideration. ­

OR, to you and me . . . they got it badly wrong!

It explains why the IMF Managing Director, Christine Lagarde, is at loggerheads with German banks over Greek debt. The banks want blood from Greece and the IMF are now recognising this will not work and will jeopardise the standing of themselves and Brussels. It could also be another nail in the coffin of this currently disintegrating project that is the EU.

(Even President Obama is now backing Social Security programmes he was previously against for the American people.)

And if that wasn’t enough, according to Zero Hedge Euro-Area manufacturing is near stagnation, damping confidence in the strength of the regions recovery.

The cracks are beginning to appear in the established and very abusive order of things, if the perpetrators are now publicly admitting there is a problem of their own making. We are talking here of fundamental beliefs that have dictated how governments rule and what place, if any, democracy plays in the process.

Millions of people are homeless and struggling to feed themselves, some so overwhelmed by what they have been made to face that they have committed the tragedy of suicide. That the civilised world has been taken to this place is a lesson for us all.

The values demanded by ‘the people’ are the correct moral values for Society because it is the majority who are expounding them. The minority view can only ever be the view of vested interest, as this paper has identified and the IMF are to be respected for allowing it to be published. If it were Brussels it would have been sat on!

So my friends, where do we go from here? As you know my mantra is “Awareness breeds understanding and understanding breeds change”. There can be no way forward with ‘Austerity’ after this damning report.

Any government who continues to pursue these measures should be ousted from power as totally lacking in credibility and care for the people who have placed their trust in its leadership. And that goes for Brussels as well!

Until the next time

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes

Student Debt . . . Society’s Shame!

According to the Office of National Statistics there are now 3.3 million young adults living with their parents. That’s 618,000 young adults (aged between 20 – 34) more in 2015 than in under a decade ago in 1996. Or to be more precise . . . That’s around 1 in 4 young adults were living with their parents in 2015!

As we delve further it gets more unpleasant, as we see that the percentage of young householders has decreased from 55% to 30% for 24 – 29 year olds and from 68% to 46% for 30 – 34 year olds, in that same time frame.

Neoliberalism sets out to create a rentier Society, where feudalism can flourish because land ownership is retained in the hands of the few. To ram home the point 91% of 20 – 24-year-old householders . . . YES 91% . . . live in rented accommodation, meaning just 9% own or are buying a home of their own.

The UK government tells us it wants to increase the number of affordable properties available for the young, supported by the other political parties who have raised this issue. This is lunacy of the worst and most despicable kind where our young are being financially crippled with student debt by that same government.

What possible logic is there in robbing the young before they have a job and then declaring that a ‘caring’ government’s solution to this problem is a ‘soundbite’ that might create a meagre supply of homes that would be affordable to some of the people they are enslaving in debt?

The lunacy becomes mind-numbing when we now hear that 73% of students will have some debt written off. If this is true, then what possible point was there in nearly doubling the average size of personal student debt in the first place?

In the US it gets even more horrific, as over $1 Trillion of student debt is viewed as a trophy of neoliberalism. Indeed, the government has actually changed the laws on bankruptcy so that they prohibit students from taking this course of action when debt becomes too much. However, the law continues to allow corporations this avenue of escape when their debts become too onerous.

Following this progression, it begs the question as to whether this unpleasant form of neoliberalism will cross the Atlantic, like so many other financial practices, to further persecute our young?

What we must not lose sight of here is that with the threat of even more odious trade agreements now being signed into law, (with supposedly no way of taking them off the statue books once they arrive), will bankers have the legal clout to enslave our young – and everyone else – in debt repayments, with no legal means of reprieve?

We create our world from what we believe in and our dominating beliefs dominate how Society conducts itself. Currently the purveyors of neoliberalism have the floor and their greed will be their eventual downfall because they are totally unaware of the type of Society they are breeding.

If we get down to basics, natural laws are by far the most powerful at work on this Planet and they are now being contravened big time! Not matter what type of living creature you are, be they animal or human, there is an overwhelming drive to ‘leave the nest’ and strike out on your own to carve out your own life. We see this at its most pronounced with fledgling birds and even lion cubs, where the parents will forcefully drive their young away to begin their own lives.

Human beings, being the most ‘intelligent’ of the Planetary species however, are arrogantly ignoring this most basic of drives and actually impeding this natural progression of its young. This greed driven action will have disastrous repercussions as our young become more and more disenchanted. Not because they are ambitious or violent but because they are trying to answer the call deep within each of them to ‘set up their own nest’ and breed a family.

Neoliberalism lacks any moral conscience and because it lacks the intelligence to work out that true power comes from nurturing those you wish to have power over, it is breeding a terrorist Society of the future. The young, we know, are easily drawn to terror organisations and other rebellious groups such as the evermore successful hacking groups.

It is not that they are inherently violent or want to kill. They simply see it as the only course of action, to try and right the wrongs being heaped upon them. Every explosion or release of secret documents into the public arena is a victory against this abusive establishment that is intent upon growing feudalism.

They are too intelligent to be returned to this medieval form of control (they have an expensive education to prove that!) and resistance will become stronger as long as neoliberalism is allowed to continue to dominate our culture.

The young are our future. What we sow in their young minds dictates tomorrows culture. We cried out that all young, no matter what their social standing, should have access to first class education and all we did was create a huge class of the indebted, with no chance of the promised jobs with which to repay that debt.

Society must hang its head in shame that we are not nurturing our future Society to look after this beautiful Planet. Instead, we are fomenting conflict and destruction that could escalate to unthinkable levels of destruction with arrogant, uncaring and bloody-minded governments.

Another ‘Wake Up’ call that is not getting sufficient exposure to my mind.

Until the next time

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes

2016 . . . Feudalism is Returning

The private banks have argued for a long time now that the issue of money should be exclusively theirs. They further argue that to allow governments this power would see political abuse of the monetary system. It is a sound argument, which has allowed financiers to amass not only great wealth but also vast power that now, as we are seeing, is usurping the powers of elected governments and eradicating democracy.

The end result of this is that in this 21st century we are being taken back to a feudal Society, where the people own very little and are enslaved by debt.

In feudal times the peasants (people) were allowed to farm and cultivate plots of land by renting that land from the powerful (Barons). They rarely achieved ownership of the land they worked because a large portion of what they grew was taken by the Landowner as rent for the land. This kept the people at a barely subsistence level from what they farmed. If they had a poor year they incurred debt, because of inadequate supplies of crops with which to pay the rent. If they were unable to ‘grow their way out of debt’ they were enslaved in serfdom.

I see many similarities between then, when Magna Carta came into force and today. Our private money system has created a property boom which is now pricing property at such astronomical rates, more and more people are being returned to renting their own home, or denied that opportunity, with little chance in the foreseeable future of this situation changing . . . A rentier Society.

Technology is being allowed to replace jobs with no political will to lead a vision of employment in this new era. Already the young are consigned to a form of slavery, as educated graduates, burdened down with debt, are finding it less and less possible to engage in a career with a meaningful future and income opportunities, leaving them with no option than to rent their homes . . . A rentier Society.

Cash is being abolished to enable our money to become wholly digital to support negative interest rates, where we pay the banks to look after our money! This means we will have no independence or control over our finances, as was the case when cash ruled. We will soon see our money frozen at the press of a button if we somehow transgress. Remember what happened to Julian Assange and Ed Snowden . . . all accounts frozen without any judicial process to confirm their guilt . . . A financially repressed rentier Society.

Given such a lacklustre environment in which Society is expected to function it can only mean a return to the feudal times of centuries ago. And this in a time when we can send people into Space and perform the most miraculous of medical operations and healthcare.

Nowhere is this more obvious than the odious TTIP trade agreement, which is being forced upon governments around the world. It will reduce populations by 50% by starving people, abolishing pensions and spreading poverty, according to Michael Hudson in an interview with Bonnie Faulkner this month (I am indebted to T J Greene @greentak for this one) http://www.nakedcapitalism.com/2016/02/michael-hudson-discusses-the-new-global-financial-cold-war.html

This supposed trade agreement is to force privatisation and disable government regulation.

. . . And I quote:

“There are a number of related aims: to nullify environmental protection regulations that cost money, to nullify protection of labour, and to nullify attempts to tax natural resources or economic rent. The idea is to turn roads and the transport system into toll roads, which will be owned by foreigners and run at a high charge. The Internet and the water system will be sold off and made into toll systems, to charge for their services and for other basic needs. This will impose a neo-feudal rentier economy throughout the world as the finance, industrial and real estate (FIRE) sector takes over the government sector.”

. . . And just to hammer home the point:

“The neoliberal plan is to create a post-industrial society. By “post-industrial” I mean a neo-rentier economy returning to feudalism. Instead of governments taking the lead and providing basic services at a low price to become a competitive economy, neoliberalized governments sell roads and energy, electricity, water and sewers to buyers that are going to charge whatever the market will bear. This is going to impoverish the country. It’s the opposite of what development economics taught through most of the 20th century”.

Austerity becomes a lot clearer when you realise that all of the debt slushing around this beautiful Planet is now so vast it has become unrepayable. The bankers have engineered this so they are now able to take repayments in the form of sovereign services, transport services, health services and water and sewage systems.

We are returning to a feudal society, by way of debt, that has been allowed to grow beyond prudent levels. Greece, which I rant so much about, is a precursor of what is to come. Where a country is simply broken up to pay odious debt that has been foisted upon its people by irresponsible bankers, aided and abetted by equally irresponsible politicians. Their beautiful islands are being sold off at rock bottom prices like some second hand car auction. TTIP is preparing us all for such action!

In spite of looking very black, there is something within me that continues to say “there will be a turning point”, as there always has been throughout our history. These tactics were tried after the 1929 collapse and seen to fail miserably. John Maynard Keynes, no less, preached against such action and was shown to be right. Financiers think they know better these days and only time will tell.

Very much in our favour now is the fact that we are no longer the global serfs of centuries ago, as I have said before. We are much better educated and with the powerful means of communicating with each other globally. When and where that turning point will be I really don’t know but happen it will . . . We simply have to believe!

(As an aside, you may not be aware, as I wasn’t, that 800,000 names (2% of eligible electors!) have ‘dropped off’ the electoral register, following changes to the way citizens register to vote in the UK. That’s 800,000 people entitled to vote who no longer can help to change things. The National Voter Registration Drive – #NVRD – is driven by passionate people who are rising up to address their governments failure to manage and nurture a ‘healthy’ democracy. Actions like this are on the increase and happening everywhere . . . hence my optimism!)

Awareness breeds understanding and understanding breeds change.

Until the next time

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes

Our Toxic Financial System – Part 3 of 3

Nathan Rothschild

In Part 1 http://tinyurl.com/z3x2yzb I justified my use of the word ‘toxic’ in the title from the dictionary, which described it “Causing social harm or unpleasantness” – The Free Dictionary by Farlex. In this final part I would like to offer examples of how the biggest global monopoly in our history is now consolidating its vast powers and whether they are of benefit to Society or not.

In Part 2 http://tinyurl.com/j3xu9uq I alluded to how money comes into being. Monopoly allows them to simply create loans on a balance sheet and bring money into existence (out of thin air) for the duration of the loan and on which we pay interest.

This monopoly to supply our money no longer needs to hold reserves of tangible assets – like gold – to support the value of that money. Indeed, to protect this monopoly they actively work against any country looking to bring its own currency into existence. Recently (and quietly) disclosed in Hilary Clinton emails), it was confirmed that Gaddafi was looking to introduce a gold backed currency into Africa and never quite made it.

With no control over how much cash is circulated into Society, because it is no longer controlled by how much gold reserves the banks have to hold, we have seen a printing bonanza since 2008, as money is flooded into the economy to stave off what should have been an economic collapse and recession.

These vast amounts of money were supposed to be put out into Society to spend on goods and services, thereby stimulating the economy back into a healthy position. A monopoly however, allowed banks to hold on to the money to boost their own severely strained reserves (they were all technically bankrupt after 2008). They also gave cheap loans to the corporate world. These were used to buy out the competition and buy back their own shares, thereby artificially holding up their share prices, in an era of falling sales.

This stimulated the growing gap between rich and poor, as the banks directed their money in just one direction – the corporate world. Like a gardener directing his hosepipe to water just a part of the garden, those plants that received it flourished and the remainder withered.

In spite of all the reassurances from the experts, like the Federal Reserve, that ‘QE’ would sort the problem of growing unemployment and economic slowdown, it didn’t. In addition, these private banks have continued to merge risky investment banking with their consumer banking, the very problems that heralded the collapse of 2008.

Because of their monopolistic position the banks are again looking to the public to bail them out, by taking current account money and savings next time. (Don’t raise the fact that we have a government protection scheme to reimburse us in this event . . . that is our taxpayer money again that will support this second grand theft!!)

As we become aware of what is happening the astute will take their money out of the banks and hoard it under the bed, as we have done for eons when distrust of the banks sets in. This time, because they are so fragile, the banks want to pre-empt our astuteness by getting rid of cash, something already under way in – Canada, Denmark, France, India, Israel, Norway and Sweden, to name but a few.

If we are restricted to plastic, (which ordinarily need not present a problem, if properly overseen) our money is no longer in tangible form as notes and coins but simply numbers on a computer screen and their monopoly will allow them to deny us access at will. Their monopoly control then becomes absolute. Their reasoning is that it will enable them to crack down on money laundering and tax evasion.

Indeed, only in the last year or so Switzerland has been under attack from US agencies to make public the many corporations who deposit funds in secret bank accounts to avoid tax. Having done the gentlemanly thing and given in, Switzerland is now seeing this money transferred to Reno, Nevada in the US, where that same privileged tax status is available to those same corporations!

Debt obligation is underwriting the flourishing of this financial monopoly and as with all monopolies, Society is the poorer for it. We have absolutely no control over current financial abuse and our governments seem to be helpless because of their debt obligations to theses very banks.

Private banking has its place in Society, I believe, as a provider of services to the corporate world. What current banking practice has established is that we need a separate ‘public banking’ system, for the private individual and accountable to those very people, as both customers and taxpayers.

Here there is a ray of light in no less a place than Switzerland, the home of global banking. This country operates both public and private banking services, the former of which provides the citizens with one of the best health services in the world. Now there is a move to demand that government, not the private banks, has the exclusive power to create the country’s money.

The reasoning for this is summed up as follows:

  1. Currently money is created as debt, resulting in severe malfunctions.
  2. The country’s money supply is under private control and therefore a monopoly.
  3. Bank deposits are not secure.
  4. Money supply rises and falls in line with banking profitability, not social need.
  5. The money supply fosters inflation.
  6. Debt issued money is only a benefit to banks and not to Society.

Interestingly this has not been widely covered by global media and left to the specialist publications and social networking to be heard. (Another ray of light in our rapidly changing world!) It is early days but here, at its very centre, is evidence of awareness on the injustices of debt driven monopoly banking.

We have a new, plain speaking breed of political leader emerging and showing integrity and a desire to break from the current world order of unelected corporate rule . . . like Jeremy Corbyn in the UK and Bernie Saunders in the US.

They can’t do it on their own, as Gaddafi, Lincoln and JFK have previously demonstrated but in league with like-minded politicos we could see real progress to a less abusive monetary system . . . and so much more.

Awareness breeds understanding and understanding breeds change

 

Until the next time

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes

Our Toxic Financial System – 1 of 3

Nathan Rothschild

I deliberated long and hard about using ‘Toxic’ in the title and even turned to the dictionary. This decided me (The Free Dictionary by Farlex):

3a. Extremely risky or harmful, as a debt for which the borrower is in default and the collateral has lost   so much value that its sale cannot cover the amount of the loan.

3b. Causing social tension or unpleasantness.

A ‘Monopoly’ is something we are very wary of because we know from bitter experience it generates a level of power over the users of services and goods that becomes increasingly uncompetitive and expensive.

Big Pharma is a good example, where (patented) life giving drugs are price fixed to (often) put them out of the reach of the very people they should be helping. The AIDs virus was one such case, particularly in Africa, where it was rife and standards of living were amongst the poorest in the world.

This pales into insignificance however, compared to our global private banking system. They too have ‘patented’ money and become the exclusive suppliers of 97% of the world’s currencies and cash. It is by far and away the biggest monopoly within our species.

We know how toxic monopolies can become and regularly introduce laws to restrict such practices. The sheer size and power of global banking demonstrates how ineffective we are in this endeavour.

Whilst Big Pharma create exclusivity to price fix their products for maximum profit, private global banking is amassing vast powers over the global population from debt, which also produces elephantine profits for them.

Monopoly ignites human fallibility to abuse and greed and power are the ultimate fuel. We have seen this power at work in 2015 when unelected representatives, the Troika, brought Greece to its knees, shocking the world in the process. This is the power of debt at work in all its uncloaked savagery and witness to control by monopoly.

Monopoly often goes beyond what many people are aware of and is best described with the many levels of abuse on Society through Student Debt. To start with there is the moral issue, which seeks to make money out of our young before they even have the means to financially stand on their own two feet.

This helps consolidate the monopoly position of private banks in several ways. Firstly, it places students under financial obligation and gets then used to debt at an early age, conditioning them to a mental frame of mind that accepts debt as the primary means by which to finance their future lives.

Secondly it indentures them into an already financially controlled Society, ensuring they feel they are in a ‘normal’ environment where the payment of interest, for the use of the money in their pockets and bank accounts, is paramount.

Thirdly, this monopoly environment begins to reach into other areas of their lives. It is now the (ludicrously narrow) yardstick by which characters are assessed, even to the extent of how credit worthiness can affect suitability for a job – to hell with an expensive university education!

Sadly, this monopoly is strengthened by our governments who have been inveigled into supporting this lending as the ‘retailers’ of the money, borrowed from the banks and put out in grants, hoping to make a profit on the deal. “Wait a minute” I hear you say, “This is a good thing as government makes a profits that benefit taxpayers!”

Sadly, it is now becoming apparent that their inability to create employment is seeing a growing number of students unable now to repay the loans. In the UK in 2015, government set aside £2bn a year to cover student loan write down. 45% of loans are now anticipated will be written off . . . It was $3billion in the first three months of 2013 in US!

This means that instead of a profit for taxpayers they will yet again be contributing to the profits of private banks. The students cannot be made to repay the debt but government can, with taxpayer money, because they too are indentured by the power of this global monopoly, whose concern is only ever the payment of their profit/interest.

We can see through this one example, how the toxic power of monopoly can cause multiple abuse. Here, in addition to the enslavement of the young, public money is intertwined with commercial practice to underwrite guaranteed profits for private banks, when it has actually been raised to provide public services to support Society.

I have tried here to illustrate how pervasive debt has become within our Society, from a monopoly control that we have known for centuries is both abusive and destructive. In Part 2 I will take another closer look at the private banking system, to illustrate the toxic affect that monopoly has upon our future as a species, by controlling Life through frighteningly narrow constraints.

Awareness breeds understanding and understanding breeds change.

Until the next time.

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes

BIS . . . A Legally Unaccountable Bank!

I believe this is my most important contribution, so far, to our growing awareness of how the world works. I am deeply indebted to Adam Lebor for his book ‘A Tower of Basel’ and its huge contribution to this awareness. More details here: http://tinyurl.com/omhkyen

 

Like me, you may have seen the odd reference to the Bank of International Settlements and had no idea what it was, nor what it did . . . and that suits the BIS just fine!

As the central pillar of our global financial system, it is responsible for furthering the interests of central banks by building and maintaining the architecture of transnational finance.

It came into existence in 1929 as the brainchild of Montague Norman, then governor of the Bank of England and one of the most powerful men in the world, together with Hjalmar Schacht president of the German Reichsbank. Its express purpose was to administer German war reparations (financial compensation) to the allied countries involved.

Both Norman and Schacht were very shrewd financiers, with ambitions way beyond a simple administration office. They immediately set about creating a global bankers ‘club’, bringing together the heads of the main central banks with monthly meetings, which continue to this day in absolute secrecy in their offices in an 18 storey tower building near Basel railway station in Switzerland.

Today its members include Ben Bernanke, former head of the Federal Reserve, Mark Carney, Governor of the Bank of England, Mario Draghi of the European Central Bank and the central bank governors of Germany, France, Italy, Sweden, Canada, India and Brazil. The object is to share information and build consensus on the direction of our global financial system.

Returning to its roots, in 1930 the governments of UK, France, Germany, Belgium, Italy, Japan and Switzerland signed the Hague Convention making the BIS untouchable, as the most privileged and legally protected bank on the Planet.

(The “You can no longer touch us”) Article 10 of the BIS Constituent Charter states:

The Bank, its property and assets and all deposits and other funds entrusted to it shall be immune in time of peace and in time of war from any measure such as expropriation, requisition, seizure, confiscation, prohibition or restriction of gold or currency export or import and any other similar measure.

With it becoming ever certain that a second world war was imminent, Schacht and Norman believed financial – not political – disciplines were the only way to ensure the world could be rebuilt from the carnage and return Germany to its strong trading position in Europe.

To achieve their aim it was necessary to maintain the smooth flow of global finance during the war years and provide a haven for gold transactions without political interference. Whilst these objectives appeared laudable, they also carried sinister connotations the BIS have since found difficult to shake off.

Schacht was a financial genius and as Germany prepared for war, Hitler made him General Plenipotentiary for the war economy, placing an emphasis upon delivering the finance necessary to build a vast German war machine. He achieved this with the help of his connections in the BIS. It can be seen from this that financial values dominated, over political considerations, as ‘enemies’ were working together to finance the war.

Before outright hostilities, Austria was ‘incorporated’ into the German Reich and its gold moved to the BIS where it was held for use in Berlin. This was the first of many transactions that involved Nazi looting and plunder during the war. The BIS justified its part by reminding everyone that it was above political intrigue and that the proper financial paperwork had been carried out for these transactions to take place.

In Spain, General Franco was helped to power not only by German and Italian fighting men and machines but also by the hundreds of millions of dollars’ worth of aid also provided by these countries. The latter managed and facilitated by the BIS.

At the height of the Second World War, when armies were killing each other by the tens of thousands, international finance continued unimpeded through the BIS, financing the slaughter on both sides.

When Czechoslovakia was overrun, the entire gold supply of the country was taken over and deposited with the BIS, sacrificed to the needs of transnational finance and the Third Reich. This ‘legalised looting’ was a particularly dark time in the BIS history, exacerbated by also taking in deposits of gold teeth that had come from the concentration camps, all of which were used to finance the German war effort.

It was Cicero, two thousand years ago who observed that “The sinews of war are infinite money”. The BIS updated that wisdom through their actions during the war years to read “The sinews of war are the transnational flow of infinite money!”

When the war finally came to an end attention turned to rebuilding Europe. This saw the introduction of the equally independent International Monetary Fund and World Bank, threatening the very existence of the BIS. However the US demanded, that in return for aid, they wanted the integration of Europe and the erosion of national identity, in the interests of reducing friction between countries. This offered the BIS new opportunities.

Rather than compete with the IMF and offer loans to troubled economies, nor fund development projects as did the World Bank, it would offer discreet services for financial co-ordination, something in huge demand at that time. Europe would need harmonised exchange rates, swift international payments mechanisms and eventually a new single currency, the very core of BIS capabilities.

With the BIS working in the background, in 1951 France, West Germany, Italy and the Benelux states signed the Treaty of Paris establishing the European Coal and Steel Community. This created a ‘common market’ for coal and steel which was regulated by this unelected supranational institution.

It is here that the birthing of the EU truly began, setting a pattern of ‘economically expedient’ excuses for the removal of national sovereignty, rather than the political machinations that it actually represented. And so the rule of technocrats also began and has continued to expand into the present day.

(I have always believed that the unrelenting attacks upon our Royal Family, by Murdoch’s media, had sinister undertones. The strategies adopted for the integration of Europe all those years ago now bear this out.)

This thumb nail sketch of the history of the BIS raises many issues in today’s world. Whilst it is plausible to say that financial disciplines, over political, can provide the smooth running of finance, supporting international trade and growth that benefits us all, our actual experience of the work of this unelected and highly secret organisation has not been as promised.

At the heart of our problems is the human fallibility for power. Only this year the IMF and ECB demonstrated their powerful independence from political authority in the unnecessary bullyboy tactics they chose to adopt when Greece stood up to their ‘Austerity’ measures. Their unbridled power meant that they paid no heed for the distress their deliberate actions caused to the Greek people and the suicides that continue to this day.

‘Austerity’ is a lie and excuse to further reduce national sovereignty by plundering the national assets of countries. The TPP trade agreement also, is not about trade but the subjugation of democracy to corporate power and hence the paranoid secrecy until its launch on an unsuspecting public.

That our money is now being stolen from us, either as taxpayers or as bank customers, to pay for malpractice by those very banks; that cash is now under threat, to provide greater control over the monetary system and that we are being moved into a nightmare world of negative interest rates, is the outcome of the BIS’s development of the EU and its rule by technocrats.

Morality is nowhere to be found in this new world and will eventually bring it down. That the credibility of the EU and its dubious currency is coming under increasing pressure, as the people see their sovereignty taken away and democracy constantly undermined, is demonstrating that the financiers post war dream of a European federal state is unworkable.

The BIS itself is now coming under threat, as its strict conditions of secrecy, which have always been its true power, become outmoded in an increasingly transparent world. People are waking up and veils are being lifted.

The greater our awareness the greater the demand for change and the ending of this traditional abuse of the majority. Just imagine the re-balancing of current power if global trade unions and charities created such an organisation!

Until the next time

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes

Greece/Cyprus . . . A Sinister Experiment

I have just finished an incredible and comprehensively researched book by Ernst Wolff that has made me realise how naïve I have been about the forces that control our world. It’s called Pillaging the World, The History and Politics of the IMF and like me, will change your thinking about how the world works.

The IMF was birthed out of negotiations between the US and UK in 1940, designed to create a new world monetary order. Officially the job of the IMF, as a supposed independent body, was to bring stability to global financial systems and help out troubled countries in crisis who were members of its ‘club’.

The UK was subsequently pushed to one side and it was then designed primarily to represent the interests of the US and secure economic world domination, becoming the real force behind the development and growth of neoliberalism.

To conceal this purpose it has always been presented as an independent body, supported by a policy of only having non-Americans as its public face, (MD Christine Lagarde is excellent as a European and a striking woman with considerable financial expertise). The people who actually pull the strings remain clouded in secrecy.

Current membership of the IMF stands at 188 countries, who have voting rights based upon their financial contribution to the ‘club’. The starting capital for the fund was $8.8 billion of which the US deposited by far the largest amount of $2.9 billion, thereby rendering the voting rights of the other members worthless.

The original statute of intention included the telling condition:

‘To provide member countries facing balance of payment difficulties with temporary access to the Fund’s general resources and under adequate safeguards.’ (My italics)

As lender of last resort the IMF quickly realised it could attach conditions to all loans, over and above the crippling compound interest that is levied. Loans are not subject to parliamentary approval and treated as classified information that is not intended for the public eye. Because of these aggressive conditions global corporations are able to move in and reap vast profits from buying up a country’s assets at rock bottom prices. Continue reading