If the global elite intends for Carbon Currency to supplant national currencies, then the world economic and political systems will also be fundamentally changed forever.Forces are already at work to position a new Carbon Currency as the ultimate solution to global calls for poverty reduction, population control, environmental control, global warming, energy allocation and blanket distribution of economic wealth. An integral part of Technocracy was to implement an economic system based on energy allocation rather than price, replacing traditional money with Energy Credits. Technocracy's focus on the efficient use of energy is likely the first hint of a sustained ecological/environmental movement in the United States. Modern emphasis on curtailing carbon fuel consumption that causes global warming and CO2 emissions is essentially a product of early Technocratic thinking. To facilitate an equilibrium between man and nature, Technocracy proposed that citizens would receive Energy Certificates in order to operate the economy. Two key differences between price-based money and Energy Certificates are that (a) money is generic to the holder while Certificates are individually registered to each citizen and (b) money persists while Certificates expire. The latter facet would greatly hinder, if not altogether prevent, the accumulation of wealth and property. Because of the connection between the environmental movement, global warming and the Technocratic concept of Energy Certificates, one would expect that a Carbon Currency would be suggested from that particular community, and in fact, this is the case.
Rothschild and Gore's New Song – Every Breath You Take, The More Money We Make
By Alan Watt, cuttingthroughthematrix.com February 2, 2010
...If you’ve noticed today too, especially in the last I’d say 5 years, we’ve found that ADVISORY boards are on everybody’s governments today; unelected advisory boards made up of supposed academia and scientific specialists.
This is the RISE of technocracy that’s supposed to take us over and bring us into a planned society where our whole way of life is to be altered completely.
Remember, the members of the Club of Rome were given the job, the task, of finding a way to UNITE humanity, to unite them under a common cause, maybe a war type scenario, so that we’d give up our rights, go along with all the new ideas they’d give to us, but ultimately to bring in a controlled, ordered, planned society.
That means family planning for everyone across the entire planet in a post-nationalistic world, an INTERdependent society, with their global order. That’s again, what the United Nations is ultimately supposed to rise up to; the occasion to be the boss of all of this, corrupt as they are, mind you.
We never get beyond that, that so much has been really planned for us. Our education goes towards this CREATION of a reality to foster obedience to a system. That’s really what your education is all about. It is very true that you’re told very little about reality while you are in school. You are told all you NEED to know… by your masters. They certainly discourage thinking outside of the box in academia. You parrot what your professor says and you make good marks and you come through. That means you’re given a scroll at the end. Your head is ‘squared’ and that means that you have been given a QUALITY APPROVAL STAMP to join their system and work for them, your masters in this world. But you’ll never really figure it out for yourself.
There is a good article here on Carbon Currency (see below). This fits into this topic. Carbon currency — I’ve told you already that this carbon tax, and so on, is not to be just put on big business and big corporations — it’s to come down to YOU.How much YOU will cost society from birth to death, and you are going to pay for it, you see. You will get personal tax, carbon tax invoices, bills coming from the governments across the world. That is part of it. This goes back again into technocracy.
By Patrick Wood, canadafreepress.com January 26, 2010
Introduction
Critics who think that the U.S. dollar will be replaced by some new global currency are perhaps thinking too small.
On the world horizon looms a new global currency that could replace all paper currencies and the economic system upon which they are based.
The new currency, simply called Carbon Currency, is designed to support a revolutionary new economic system based on energy (production, and consumption), instead of price. Our current price-based economic system — and its related currencies that have supported capitalism, socialism, fascism and communism — is being herded to the slaughterhouse in order to make way for a new carbon-based world.
It is plainly evident that the world is laboring under a dying system of price-based economics as evidenced by the rapid decline of paper currencies. The era of fiat (irredeemable paper currency) was introduced in 1971 when President Richard Nixon decoupled the U.S. dollar from gold. (Alan: Actually, it was already in fractional reserve long before that.) Because the dollar-turned-fiat was the world’s primary reserve asset, (A: Because the dollar was its primary asset) all other currencies eventually followed suit, leaving us today with a global sea of paper that is increasingly undesired, unstable, unusable.
The deathly economic state of today’s world is a direct reflection of the sum of its sick and dying currencies, but this could soon change.
Forces are already at work to position a new Carbon Currency as the ultimate solution to global calls for poverty reduction, population control, environmental control, global warming, energy allocation and blanket distribution of economic wealth.
(A: That’s the real reasons for this con game of environmental control, global warming and so on. These are the real reasons behind it. Remember, that’s WHAT they dreamt up at the Club of Rome.)
Unfortunately for individual people living in this new system, it will also require authoritarian and centralized control over all aspects of life, from cradle to grave.
What is Carbon Currency and how does it work? In a nutshell, Carbon Currency will be based on the regular allocation of available energy to the people of the world. If not used within a period of time, the Currency will expire (like monthly minutes on your cell phone plan) so that the same people can receive a new allocation based on new energy production quotas for the next period.
(A: I’ve mentioned before, Bertrand Russell wrote in the 40s about this very system when he said that eventually the government will dish out CREDITS to the public. Of course now we know it will be carbon credits. But he said the same thing, everyone on the bottom level would start off with the same amount, you can’t save it up, it starts at the same amount every Monday. That’s all to do with control. This is not a new idea. It’s an ongoing movement by a very well organized group that’s been here for an awful long time.)
Because the energy supply chain is already dominated by the global elite, setting energy production quotas will limit the amount of Carbon Currency in circulation at any one time. It will also naturally limit manufacturing, food production and people movement.
Local currencies could remain in play for a time, but they would eventually wither and be fully replaced by the Carbon Currency, much the same way that the Euro displaced individual European currencies over a period of time.
Sounds very modern in concept, doesn’t it? In fact, these ideas date back to the 1930’s.
(A: It’s actually much older) when hundreds of thousands of U.S. citizens were embracing a new political ideology called Technocracy and the promise it held for a better life.
(A: Actually, I’ve got writings from the organizations in the 1800s talking about it, from the minutes of their meetings.)
This paper investigates the rebirth of Technocracy and its potential to recast the New World Order into something truly “new” and also totally unexpected by the vast majority of modern critics.
Background
Philosophically, Technocracy found it roots in the scientific autocracy of Henri de Saint-Simon (1760-1825) and in the positivism of Auguste Comte (1798- 1857), the father of the social sciences. Positivism elevated science and the scientific method above metaphysical revelation. Technocrats embraced positivism because they believed that social progress was possible only through science and technology. [Schunk, Learning Theories: An Educational Perspective, 5th, 315]
The social movement of Technocracy, with its energy-based accounting system, can be traced back to the 1930’s when an obscure group of engineers and scientists offered it as a solution to the Great Depression.
The principal scientist behind Technocracy was M. King Hubbert, a young geoscientist who would later (in 1948-1956) invent the now-famous Peak Oil Theory, also known as the Hubbert Peak Theory. Hubbert stated that the discovery of new energy reserves and their production would be outstripped by usage, thereby eventually causing economic and social havoc. Many modern followers of Peak Oil Theory believe that the 2007-2009 global recession was exacerbated in part by record oil prices that reflected validity of the theory.
Hubbert received all of his higher education at the University of Chicago, graduating with a PhD in 1937, and later taught geophysics at Columbia University. He was highly acclaimed throughout his career, receiving many honors such as the Rockefeller Public Service Award in 1977.
In 1933, Hubbert and Howard Scott formed an organization called Technocracy, Inc. Technocracy is derived from the Greek words “techne” meaning skill and “kratos”, meaning rule. Thus, it is government by skilled engineers, scientists and technicians as opposed to elected officials. It was opposed to all other forms of government, including communism, socialism and fascism, all of which function with a price-based economy.
As founders of the organization and political movement called Technocracy, Inc., Hubbert and Scott also co-authored Technocracy Study Course in 1934. This book serves as the “bible” of Technocracy and is the root document to which most all modern technocratic thinking can be traced.
Technocracy postulated that only scientists and engineers were capable of running a complex, technology-based society. Because technology, they reasoned, changed the social nature of societies, previous methods of government and economy were made obsolete. They disdained politicians and bureaucrats, who they viewed as incompetent. By utilizing the scientific method and scientific management techniques, Technocrats hoped to squeeze the massive inefficiencies out of running a society, thereby providing more benefits for all members of society while consuming less resources.
The other integral part of Technocracy was to implement an economic system based on energy allocation rather than price. They proposed to replace traditional money with Energy Credits.
Their keen focus on the efficient use of energy is likely the first hint of a sustained ecological/environmental movement in the United States.Technocracy Study Course stated, for instance,
Although it (the earth) is not an isolated system the changes in the configuration of matter on the earth, such as the erosion of soil, the making of mountains, the burning of coal and oil, and the mining of metals are all typical and characteristic examples of irreversible processes, involving in each case an increase of entropy. (Technocracy Study Course, Hubbert & Scott, p. 49)
Modern emphasis on curtailing carbon fuel consumption that causes global warming and CO2 emissions is essentially a product of early Technocratic thinking.
As scientists, Hubbert and Scott tried to explain (or justify) their arguments in terms of physics and the law of thermodynamics, which is the study of energy conversion between heat and mechanical work.
Entropy is a concept within thermodynamics that represents the amount of energy in a system that is no longer available for doing mechanical work. Entropy thus increases as matter and energy in the system degrade toward the ultimate state of inert uniformity.
In layman’s terms, entropy means once you use it, you lose it for good. Furthermore, the end state of entropy is “inert uniformity” where nothing takes place. Thus, if man uses up all the available energy and/or destroys the ecology, it cannot be repeated or restored ever again.
The Technocrat’s avoidance of social entropy is to increase the efficiency of society by the careful allocation of available energy and measuring subsequent output in order to find a state of “equilibrium,” or balance. Hubbert’s focus on entropy is evidenced by Technocracy, Inc.’s logo, the well-known Yin Yang symbol that depicts balance.
To facilitate this equilibrium between man and nature, Technocracy proposed that citizens would receive Energy Certificates in order to operate the economy:
“Energy Certificates are issued individually to every adult of the entire population… The record of one’s income and its rate of expenditure is kept by the Distribution Sequence, so that it is a simple matter at any time for the Distribution Sequence to ascertain the state of a given customer’s balance…When making purchases of either goods or services an individual surrenders the Energy Certificates properly identified and signed.
“The significance of this, from the point of view of knowledge of what is going on in the social system, and of social control, can best be appreciated when one surveys the whole system in perspective. First, one single organization is manning and operating the whole social mechanism. The same organization not only produces but also distributes all goods and services.
“With this information clearing continuously to a central headquarters we have a case exactly analogous to the control panel of a power plant, or the bridge of an ocean liner…” [Technocracy Study Course, Hubbert & Scott,p. 238-239]
Two key differences between price-based money and Energy Certificates are that:
a) money is generic to the holder while Certificates are individually registered to each citizen; and
b) money persists while Certificates expire.
The latter facet would greatly hinder, if not altogether prevent, the accumulation of wealth and property.
Transition
At the start of WWII, Technocracy’s popularity dwindled as economic prosperity returned, however both the organization and its philosophy survived.
Today, there are two principal websites representing Technocracy in North America: Technocracy, Inc., located in Ferndale, Washington, is represented at www.technocracy.org. A sister organization in Vancouver, British Columbia is Technocracy Vancouver, can be found at www.technocracyvan.ca.
While Technocracy’s original focus was exclusively on the North American continent, it is now growing rapidly in Europe and other industrialized nations.
For instance, the Network of European Technocrats was formed in 2005 as “an autonomous research and social movement that aims to explore and develop both the theory and design of technocracy.” The NET website claims to have members around the world.
Of course, a few minor league organizations and their websites cannot hope to create or implement a global energy policy, but it’s not because the ideas aren’t still alive and well.
A more likely influence on modern thinking is due to Hubbert’s Peak Oil Theory introduced in 1954. It has figured prominently in the ecological/environmental movement. In fact, the entire global warming movement indirectly sits on top of the Hubbert Peak Theory.
As the Canadian Association for the Club of Rome recently stated,
Because of the connection between the environmental movement, global warming and the Technocratic concept of Energy Certificates, one would expect that a Carbon Currency would be suggested from that particular community, and in fact, this is the case.
“My proposal is to set a global quota for fossil fuel combustion every year, and to share it equally between all the adults in the world.”
In 2004, the prestigious Harvard International Review published “A New Currency” and stated,
“For those keen to slow global warming, the most effective actions are in the creation of strong national carbon currencies…For scholars and policymakers, the key task is to mine history for guides that are more useful. Global warming is considered an environmental issue, but its best solutions are not to be found in the canon of environmental law.Carbon’s ubiquity in the world economy demands that cost be a consideration in any regime to limit emissions. Indeed, emissions trading has been anointed king because it is the most responsive to cost. And since trading emissions for carbon is more akin to trading currency than eliminating a pollutant, policymakers should be looking at trade and finance with an eye to how carbon markets should be governed. We must anticipate the policy challenges that will arise as this bottom-up system emerges, including the governance of seams between each of the nascent trading systems, liability rules for bogus permits, and judicial cooperation. [Emphasis added]
HIR concludes that “after seven years of spinning wheels and wrong analogies, the international regime to control carbon is headed, albeit tentatively, down a productive path.”
"Imagine a country where carbon becomes a new currency.We carry bankcards that store both pounds and carbon points. When we buy electricity, gas and fuel, we use our carbon points, as well as pounds. To help reduce carbon emissions, the Government would set limits on the amount of carbon that could be used." [Emphasis added]
In 2007, New York Times published “When Carbon Is Currency” by Hannah Fairfield. She pointedly stated,
“To build a carbon market, its originators must create a currency of carbon credits that participants can trade.”
“… implementing individual carbon allowances for every person will be the most effective way of meeting the targets for cutting greenhouse gas emissions.It would involve people being issued with a unique number which they would hand over when purchasing products that contribute to their carbon footprint, such as fuel, airline tickets and electricity. Like with a bank account, a statement would be sent out each month to help people keep track of what they are using. If their "carbon account" hits zero, they would have to pay to get more credits”.
As you can see, these references are hardly minor league in terms of either authorship or content. The undercurrent of early Technocratic thought has finally reached the shore where the waves are lapping at the beach.
Technocracy’s Energy Card Prototype
In July 1937 an article by Howard Scott in Technocracy Magazinedescribed an Energy Distribution Card in great detail. It declared that using such an instrument as a “means of accounting is a part of Technocracy’s proposed change in the course of how our socioeconomic system can be organized.”
Scott further wrote,
“The certificate will be issued directly to the individual. It is nontransferable and nonnegotiable; therefore, it cannot be stolen, lost, loaned, borrowed, or given away. It is noncumulative; therefore, it cannot be saved, and it does not accrue or bear interest. It need not be spent but loses its validity after a designated time period.”
This may have seemed like science fiction in 1937, but today it is wholly achievable. In 2010 Technocracy, Inc. offers an updated idea of what such an Energy Distribution Card might look like. Their website states,
“It is now possible to use a plastic card similar to today’s credit card embedded with a microchip.This chip could contain all the information needed to create an energy distribution card as described in this booklet. Since the same information would be provided in whatever forms best suits the latest technology, however, the concept of an ‘Energy Distribution Card’ is what is explained here.”
If you study the card above, you will also note that is serves as a universal identity card and contains a microchip. This reflects Technocracy’s philosophy that each person in society must be meticulously monitored and accounted for in order to track what they consume in terms of energy, and also what they contribute to the manufacturing process.
Carbon Market Players
The modern system of carbon credits was an invention of the Kyoto Protocol and started to gain momentum in 2002 with the establishment of the first domestic economy-wide trading scheme in the U.K. After becoming international law in 2005, the trading market is now predicted to reach $3 trillion by 2020 or earlier.
Graciela Chichilnisky, director of the Columbia Consortium for Risk Management and a designer of the carbon credit text of the Kyoto Protocol, states that the carbon market “is therefore all about cash and trading – but it is also a way to a profitable and greener future.” (See Who Needs a Carbon Market?)
“The banks are preparing to do with carbon what they’ve done before: design and market derivatives contracts that will help client companies hedge their price risk over the long term. They’re also ready to sell carbon-related financial products to outside investors.”
At JP Morgan, the woman who originally invented Credit Default Swaps, Blythe Masters, is now head of the department that will trade carbon credits for the bank.
Considering the sheer force of global banking giants behind carbon trading, it’s no wonder analysts are already predicting that the carbon market will soon dwarf all other commodities trading.
Conclusion
Where there is smoke, there is fire. Where there is talk, there is action.
If M. King Hubbert and other early architects of Technocracy were alive today, they would be very pleased to see the seeds of their ideas on energy allocation grow to bear fruit on such a large scale. In 1933, the technology didn’t exist to implement a system of Energy Certificates. However, with today’s ever-advancing computer technology, the entire world could easily be managed on a single computer.
This article intended to show that:
Carbon Currency is not a new idea, but has deep roots in Technocracy
Carbon Currency has grown from a continental proposal to a global proposal
It has been consistently discussed over a long period of time
The participants include many prominent global leaders, banks and think-tanks
The context of these discussions have been very consistent
Today’s goals for implementing Carbon Currency are virtually identical to Technocracy’s original Energy Certificates goals.
Of course, a currency is merely a means to an end. Whoever controls the currency also controls the economy and the political structure that goes with it. Inquiry into what such a system might look like will be a future topic.
Technocracy and energy-based accounting are not idle or theoretical issues. If the global elite intends for Carbon Currency to supplant national currencies, then the world economic and political systems will also be fundamentally changed forever.
What Technocracy could not achieve during the Great Depression appears to have finally found traction in the Great Recession.
“I don’t care who the government is. Let me control the money and I will control the country.”
Mayer Amschel Rothschild (attributed to the German godfather of the Rothschild bank cartel and grandfather to heir Lord Baron Nathaniel Mayer de Rothschild: owner of the Bank of England and a key promoter of the U.S. Federal Reserve Act. 1744-1812)
“The end of democracy and the defeat of the American Revolution will occur when government falls into the hands of lending institutions and moneyed incorporations.”
President Thomas Jefferson (a founding father of America, condemning present and future monopoly money power. 1743-1826)
“I want to own nothing and control everything.” “The ability to deal with people is as purchasable a commodity as sugar or coffee and I will pay more for that ability than for any other under the sun.”
John D. Rockefeller (promoter of the U.S. Federal Reserve Act in alliance with the Rothschild bloc. 1839-1937)
“We will have world government whether or not we like it. The only question is whether world government will be achieved by conquest or consent.”
James Paul Warburg (monopoly banker in testimony before the U.S. Senate Committee on Foreign Relations. Warburg was an agent of the Rockefeller-JP Morgan-Rothschild banking bloc and son of Paul Warburg, chief architect of the Federal Reserve Corporation, an unconstitutional private bank monopoly set up for cartel hegemony. 2/17/1950)
"Who controls the food supply controls the people; who controls the energy can control whole continents; who controls money can control the world."
Henry Kissinger (ex U.S. Secretary of State and ongoing agent for the ruling class. Living. Quote 1970)
“The real truth of the matter is, as you and I know, that a financial element in the larger centers has owned the government of the U.S. ever since the days of Andrew Jackson. History depicts Andrew Jackson as the last truly honorable and incorruptible American president.”
President FDR (on Fascist rule in a letter to corporate con man “Colonel” Edward M. House, a founder of the Council on Foreign Relations and political fixer for the ruling class. House also handled President Wilson for the foisting of the privately rigged Federal Reserve bank monopoly. 11/21/1933)
The US dollar has been a fiat currency for 40 years, and the result has been the dollar has fallen precipitously in value. Gold backing stability is non-existent, and government and the Fed have been free to create money and credit as they please. Those in financial power know this game cannot go on indefinitely and that is why they create wars as a diversion, or cover, for a failing financial and economic system. Besides, war is very profitable for the Illuminists, especially when you are financing both sides. The Fed’s answer to the problems that they deliberately created has been to supply endless supplies of money and credit. Thus, between 2008 and July 2010, they injected $16.1 trillion into world banking sectors. $7.75 trillion went to just four US banks, who happen to own the Fed. The remainder went to foreign financial institutions. The US big hitters were Bank of America, Morgan Stanley, Citigroup and Merrill Lynch. The result is that these banks are still broke and allowed among others to carry two sets of books. The other recipients were Barclays UK $868 billion; Bear Stearns $853 billion; Goldman Sachs $814 billion; Royal Bank of Scotland $541 and $181 billion, or a total of $722 billion; Credit Suisse of Switzerland $262 billion; Lehman Bros. $183 billion and BNP Paribas of France $175 billion. This was all done in secret and the Fed was forced to reveal these transactions under the Dodd-Frank bank legislation. After these revelations it is not surprising that current real inflation is 10.6%. We expect it to be 14% by the end of the year. Next year QE2 and stimulus 2 will provide us with 25% to 30% inflation. - Bob Chapman, The US Is Facing A Day Of Reckoning Over The Deficit, the International Forecaster, July 20, 2011
The power will be concentrated at the top with individuals serving at the bottom, serving the state if you will rather than the state serving the people
The Daily Bell June 19, 2011
The Daily Bell is pleased to publish an exclusive interview with G. Edward Griffin.
Introduction: G Edward Griffin is a film producer, author and political lecturer. He is the founder of Freedom Force International, a libertarian-oriented activist network focused on advancing individual freedom. First released in 1994, Mr. Griffin's best-selling financial book, The Creature from Jekyll Island, is a no-holds-barred look into the inner workings of the Federal Reserve banking system, or cartel if you will. Mr. Griffin's literary contributions are especially noteworthy given the validity of his vision and the exciting and troublesome nature of the times in which we live.
Daily Bell: Thanks for sitting down with us again. It's been a while. We'll ask some follow-ups to previous questions. Where do we stand with the US stimulus? Will we see QE3? Will it work any better than the last ones?
G. Edward Griffin: Well, it's always a little dangerous to make predictions about what's going to happen, but I think in this case the risk factor is pretty low, because that's all these fellows know how to do ... what is called QE1, QE2. Quantitative easing is merely a more sophisticated phrase for creating money out of nothing and pumping it into the economic sectors, wherever they have friends, wherever they have places they need to re-enforce, to their own economic benefit.
They always make it sound like it is for the purpose of improving the economy, but make no mistake about it, we are dealing with a pretty corrupt system and there are a lot of people in that system that need to be taken care of. The larger banks, the larger financial institutions are always at the top of the list. If you follow the money, you will find that the lion's share of it always goes to the banks. And if it doesn't go to directly to banks, the next share goes directly to those corporations and institutions that owe money to the banks and are having trouble making their payments.
So, by sending money to these corporations and institutions, like General Motors for example, then they are always able to continue sending money to the banks. So, it always ends up at the banks. And that should be no surprise because the engine for all this is the Federal Reserve System, and if people don't know it by now, they should know very quickly that the Federal Reserve System is a banking cartel. It's no different than a banana cartel or oil cartel, shipping cartel, and it happens to be a banking cartel and like all cartels the purpose of its existence is not to help the public, not to benefit the economy, not to help America, it's to benefit the members of the cartel, period.
That's what's going on in the process. Its all they know how to do; that's what they are created to do as long as they are able to exist and given the power, that is what they will continue to do. And the second part of the question is, will it work any better than it did previously, the answer is that it worked very well but the problem is most people thought it was supposed to help the economy but that was never it's purpose, it was to help the banks.
Remember this is a cartel and so the purpose of all this easing and stimulus is to help the banks and the political structures support the banks; that was its purpose. It was a very great success. So, it will work just as well next time around, aiding those hidden agendas. In terms of the economy and the people, it was never designed to help them.
Daily Bell: Are we seeing significant price inflation now?
G. Edward Griffin: We're not seeing it at the retail level yet, although I guess it's how you define the word significant. If your food bill goes up 5% and you are barely able to make ends meet, that is significant price inflation. However, if you're living a nice comfortable life, and you have a little margin, 5% is not significant.
I have to say, that I don't believe for a minute the official figures that come out of Washington that describe our inflationary trends. They are talking about 3, 4 or 5% kind of thing; I don't know many that really believe that. All you have to do is go to the store and look at food prices, go to the gas pump and take a look at gas prices, go to the colleges and take a look at education prices and so forth. With the exception of housing and the stock market, the two big bubbles that had to collapse, all of those prices are much higher than what the government is saying, they are going up at a rate higher than that.
I believe that the true rate would be about 18-21%, if we had any way to really measure it. Now that is significant by any person's measurement and I think we've just begun to see the trend develop. I think we are at the beginning of what will become an almost vertical climb, parabolic in nature. We are at the base of a parabola right now and as you know they get steep pretty fast. I think that within the next 18 months we are going to see triple digit inflation. We have seen it in other countries and we are seeing it at work here.
Daily Bell: You've predicted hyperinflation? Is it closer now?
G. Edward Griffin:Oh, yes, in fact it's already here. But there again we need to define words like hyperinflation. I guess most people define hyperinflation as 2 digit and/or 3 digit inflation, but hyper simply means very, very, very high and different people have different definitions of what that would be. In the eyes of the people who are already struggling to survive, we are already there.
Daily Bell:Queen Elizabeth II is worried about her empire breaking up. Should she be? Is the Internet having anything to do with this?
G. Edward Griffin: I am going to pause on that one. They are very alert to what's happening and border-line nervous to see how it's going to play out. They have been beefing up their security forces, their homeland security forces, their police forces; trained their military forces to be capable of combat on their own native soils. They've built internment camps, they have developed weapons for crowd control and they have been working on this for decades. So, what's happening is that we are coming closer to that point.
Daily Bell: We've started to use the term Internet Reformation – as the Gutenberg Press was partially responsible for the Renaissance, Reformation, etc. Too pat? Any truth to the nomenclature in your opinion?
G. Edward Griffin: I think that's a very good nomenclature for it, I think that's exactly what's happening and that's one of the reasons that the elites, (and that is your word) are nervous about the Internet and are working very diligently at putting in mechanisms that are controlling and censuring the internet.
They are making good progress on that by the way. All they have to do is convince the American people is to say it's a good idea, supposedly because it will help fight terrorism or pornography or crime or drugs or something. They are always being sold some fear-based reason that control over the Internet is good for the people and so far, unfortunately, the average person has bought into that.
They are saying, oh, yeah, I'm so glad they are putting that control on the Internet and now another one and that's good, because now we're more secure, all of this propaganda is conditioning people to accept control of the Internet. So in answer to your question, I think that is has been a great revolutionary step forward but it's also under attack and we need to be very energetic in defending it or we are going to lose it within the next generation for certain.
Daily Bell: Are events spinning out of control? We think that's what happened with the Gutenberg Press. The elites thought they could control the new enlightenment but in the end they couldn't, at least not for generations.
G. Edward Griffin: I would like to believe that but I think the show is far from over and the answer is far from determined. I am not so certain it is as cut and dried as that and leads to such a happy ending as you have just described. I think the elites are working very hard to capture control of it. If they were just sitting idly by, and if they didn't have the power of governments behind them, then I think we'd have cause to rejoice. However, they are not just sitting idly by. They are passing laws at an international level all the time, so I am not so sure as to say they have lost control of it. I think they are working hard and we have to work equally hard or we will lose control of it.
Daily Bell: Are you more or less optimistic about efforts to control the Internet. Will the elites succeed in their evermore-frantic efforts? You mentioned the United Nations last time.
G. Edward Griffin: I think the answer to that is based on how much resistance they meet. Right now, with the current level of resistance, I think they will succeed in controlling it. But the encouraging thing is that the level of resistance seems to be increasing, so if we can sustain that and actually capture control of some of the power centers that are passing these laws, if we can get new people into office and start to have some of the power to do things and start to have the power in our own hands, then I think we could turn this around.
But right now all the power to pass laws, the power to send out the police and the army to enforce those laws, all of that power rests in the hands of the people who want to control the Internet. So unless that situation changes, they are going to succeed.
Daily Bell: We've noticed the United Nations has gotten suddenly far more militaristic and unafraid to try to impose "hard power." What are your thoughts on that?
G. Edward Griffin: My first book was about the United Nations – The Fearful Master ... A second look at the United Nations. The first portion of the book is devoted to the United Nations, so called, peacekeeping effort in Katanga, in the Congo. You talk about a militaristic, aggressive force – there was an attack against an innocent, peaceful population, which put the region under the control of totalitarians, right off the bat. That was the start of the UN's peacekeeping efforts, back in 1960 thereabouts, and my book was published in 1964.
So the United Nations started off with its very first peacekeeping operation as a totally aggressive and militaristic one. The United Nations was designed to be, from the very beginning, what is becoming very obvious and visible now – for those who wish to see. That is an organization to implement and provide world government, based on the model of collectivism, which means all the power will be concentrated at the top with individuals serving at the bottom, serving the state if you will.The UN is designed to control from the top down.
Daily Bell: Does fiat money itself continue to break down? Is the entire worldwide central banking economy being challenged?
G. Edward Griffin: I think that's wishful thinking. The international, financial, fraternity, I guess I will call it that ... industry, is in control; they're not being challenged. They control the governments. I hope people get that in their brains. The governments are parading around saying, we've got to control the banks, we've got to do this to control banks, or help the banks, but look behind the scenes and you'll find that it's the banks that are controlling the governments.
The international bankers have decided it's time for an international currency.So, all of the nations are starting to clamor for a new IMF managed currency. In this part of the world, it would be called the Amero after the North American union, consisting of Mexico, Canada and the US. Even that would only be a transition stage to an international currency. That's what the banks want – the bankers have always wanted that.
This goes all the way back to Bretton Woods. There they talked about the advantages of an international currency, even then, but felt it was not possible and too early to implement it. They knew they would have to wait a little longer and allow world events to be played out. Well, they have played out and now they are beginning to clamor for a UN managed currency, but the same financial forces will ultimateLy control it from behind the scenes. They are the power pushing for it and they are the power that will control it once it is created. So when somebody says, hey look the banks are loosing control, they better go back and look at who is controlling the governments.
Daily Bell: We just wanted to acknowledge that you virtually led the charge when it came to modern-day challenges to the current, horrible central banking system. Do you see the elites as losing moral authority regarding such memes? Do more people disbelieve?
G. Edward Griffin: Again, I am going to pause because that's a tough one. The elite have never had moral authority in my view. But, unfortunately, the average person, in fact the majority of the population, doesn't know what is going on. All they do is believe what they read in their newspapers or what they see on television, or what they hear from the lips of their politicians ... So, yes, they have had moral authority in the minds of the masses.
They are losing that to some extent because more and more people are realizing that the banks are major players in this rotten system. Prior to a few years ago, people never thought about banks as being major players in anything except clearing your checking account or your savings account. But now more and more people – likely by the millions – are waking up to the fact that banks and bankers are major, political powers.
With this happening, I think they are losing moral authority because banks are gaining incredible wealth while the average person is losing what little he had. So I am glad you mentioned the issue of moral authority, I really hadn't thought too much about that, but I think you are right. If there is any place on this spectrum where the elites and the financial institutions are losing, it's probably in that psychological area of moral authority and being on the high ground.
Daily Bell: Max Keiser estimated there are some 600 rebellions and regime changes going on in the world. These can't all be CIA sponsored can they? Or perhaps they are the result of food insecurity. Do the elites intend to plunge the world into utter chaos? Why?
G. Edward Griffin: Well, I guess this is my day to say whatever just comes to my mind. (Laughing.) Yes, all 600 rebellions and regime changes could be the result of the CIA. I don't think people realize how powerful and all invasive the CIA is in this world.
You know, the CIA is actively involved in all of those countries and are very influential in picking opposition candidates. Most of the leaders of the third world countries are there because the CIA supported them at one time, and those that go into office in that way can also be deposed that way. You don't have to dig too deep to know that. They are involved in regime changes all over the world.
Daily Bell: You make an issue of being optimistic or pessimistic in your answers. But what is your overall sentiment?
G. Edward Griffin: I want to emphasize that I am probably the most optimistic person you will ever meet regarding the future of freedom. But I have a longer view of history than most and because I take a long view, it may seem as if I am pessimistic in the short term because real change takes time. Many people don't look much further into the future, than the next election.
The forces that must be overcome have taken many years to grow to the present state of strength that they have. In the United States for example, the forces of collectivism have been growing and coalescing for decades. It took a hundred years, in fact, to capture the influence of the universities, the government, the media, the major corporations, the think tanks, etc. It took a long time.
It also resulted in conditioning the minds of the American people to accept certain presets – to accept the principles of collectivism. Americans have bought into collectivism. They think social security is a good thing. They think that governments should provide health care benefits; they think that government should provide everything as a matter of fact. They've been brainwashed into believing that.
In fact, it took a hundred years to bring that about. And you can't reverse that by November. You CAN reverse it if you take a long view of history. That's why we created an organization called Freedom Force International, because we have a longer view of history than next November. We have a view that encompasses a generation, possibly two generations and we know if we lay down the corner stones now, for certain principles and strategies, that there is no stopping them, even if the world turned to another "dark age" in the meantime.
We are laying the seeds for something that will grow and overcome the forces of tyranny in the next generation or two. And even though I may not live to see that, it's a very comforting and optimistic thought that I am doing something that in the long run will bring the world back to the principles of freedom once again.
Daily Bell: What about Ron Paul and his freedom message?
G. Edward Griffin: I think Ron Paul is doing an excellent job given the constraints under which he must operate. Ron is not able to say anything and everything that comes to his mind, like I am here, and possibly say the things that people don't want to hear ... but fortunately I am not running for office.
Ron, poor chap, he has to worry about not saying too much for fear he may go beyond the understanding or educational level of the people he wants to vote for him. So, that's a terrible constraint to live under. He is doing the most amazing job I have ever seen and I can't imagine anyone doing any better under that constraint.
Daily Bell: We discussed the way the conservative movement is desperate to co-opt the libertarian message and that it has launched a number of artificial candidates to do so – including notably Sarah Palin. What do you think?
G. Edward Griffin: It's becoming more and more obvious. I guess if people don't fall for it any more, then I guess you could say it's failing. With each turn of the wheel, with each election, people should learn that they fell for the same old trick, one more time. Every election people fall for the same trick. And that trick is, they believe the campaign speeches of the candidates. They don't realize that the candidates, for the most part, spend a lot of time and money either conducting polls or studying polls very carefully. They do it to find out what people want to hear. And then they hire campaign managers and speechwriters to enable them to deliver to the population what they want to hear.
In many cases, politicians are just little recording devices. They have no feelings for what they are saying, they have no connections, they have only one goal and that is to get elected. And it is hard to find a person who you can say does not fit into that category. The only way that you can tell if a candidate is a real genuine person is by looking at their career. See what they have done in the past. Voters, unfortunately, are not too good at that. They just seem to want to hear what the candidate says, does he or she sound sincere and so on.
The candidates are basically performers, like actors. But when you take what you call, the conservative movement, and that's a good word, because that's exactly what they call themselves, many of these people have been in office for a long time and all you have to do is look at their voting record and you can see what they believe, or at least what they vote for. And then when they come along and say they are going to restore the constitution and restore this country to constitutional principals and you see their voting records, you find out that 99% of the time when they voted, they violated the constitution. That ought to be a clue of what they are really all about.
So as each election goes by, and this trick is played on the voters again and again and again, I think there are a few more people that wake up to that trick. Eventually, and I don't know how long it will take, I think more people will wake up. Let's hope we have enough time.
Daily Bell:We think Ron Paul has a reasonable chance to become president. Optimistic? Loony?
G. Edward Griffin:As one man, he is kind of limited.He could say all the truths in the world and nobody would ever hear him because the mainstream media would block him. They would never allow him to make those statements – or the people to hear them. If they did, his statements would be twisted and accompanied by commentary, which would make him seem like he was some kind of ogre.
I don't think Ron Paul, as one man, can overcome that. However, an army of supporters, millions of supporters, can. So then you come to the next question, well what if he did get elected? Does anybody really think that one man in the White House even with his high principles can change anything? When he is surrounded by a congress, senate, media and educational system that are all working against him, including the military, it can't be done.
We are back to one of my favorite themes, which is that in order to bring about real positive change in America, our movement has to be broader than just winning the election in November. We could put a man in the White House in November but lose everything.
Daily Bell: Your sentiments remind us of something former presidential candidate and a departed friend of ours, Harry Browne, once said when asked what would be the first thing he would do should he be elected president. His reply – "I'd quit." I guess that summarized how he felt about the constraints. Anyway, back to Ron Paul … Dr. Paul is anti-war, overseas anyway. We think the Pentagon is beginning to lose badly in Afghanistan. Your thoughts?
G. Edward Griffin: I think he is anti-aggressive-war. Is the Pentagon loosing badly in Afghanistan? What is the military presence in Afghanistan? Is it really to root out all the insurgents or is it to encourage the insurgents and keep them active, so we have an excuse to be there? I think the Pentagon is winning or achieving its goal in Middle East. Its goal is to be there and to have a reason to be there forever.
Daily Bell: We think Osama bin Laden died ten years ago and that the SEALS "tapping" of bin Laden was phony. Your thoughts?
G. Edward Griffin: I agree.
Daily Bell: How about 9/11. We've asked this before. Will the American establishment media ever get to the bottom of 9/11? Are you more hopeful? Last time you were not.
G. Edward Griffin: Well, I don't think the major media will ever get to the bottom of it because they are not motivated to. They are controlled by the investment and political powers-that-be that don't want the media to get to the bottom of 9/11. Like we were saying, it has to be a grass roots movement. Millions of people are acting in addition – or around major media – and I see that movement growing all the time.
I haven't seen figures lately, but I remember maybe 6 or 7 months ago, that about 48% of the people thought that the official government story of 9/11 was not true. They didn't know what it was but they had a strong feeling it was not true, that there was something being covered up. Well that progressed quite rapidly. A few years prior to that only 5% of the people believed that was true. Now, I don't know what it would be, but I bet it's closer to 60%.
That is not because of the major media. That is simply because people like us have been out there talking about this and presenting evidence. We are circulating CD's and independent productions that bypass the major media. I think that is where our hope lies.
Daily Bell: Let's sum up. You indicated in the last interview that you were more optimistic in the longer term. Ideas about freedom cannot be stopped, you said. Once people understand the truth, they are not ever going to easily forget it. Are you still of this opinion?
G. Edward Griffin: Times two.
Daily Bell: Is the US and the world possibly headed for a global depression? Are we in one already?
G. Edward Griffin: I would say we are in a far developed recession, but that's only my own feeling and my own words. A depression to me implies, people starving, begging and generally walking around aimlessly looking for a place to sleep. I know we have this in the United States, but it's still a relatively small percentage of the people as a whole. But it's going to keep affecting more and more people and I fear that we are going to see a global depression develop in time.
Daily Bell: What would you advise people to do from an investment and survival standpoint?
G. Edward Griffin: There is no long term survival under conditions of absolute tyranny; there are short term solutions. We are thinking in terms of months or possibly a year. There are things you can do, like getting yourself out of debt, so there is no legal reason for anyone to take your home.If you have any reserves or surplus savings, put it into tangible assets of some kind.
I would say another thing would be to network with people of like minds, because if things get bad, it would help to have like-mined friends. Discuss what to do and know what to do, there will be a lot of desperate people and desperate people tend to get violent. There is nothing sophisticated about any of these answers but I want to come back to a starting point, which is that in the long term there is no survival under tyranny. So people need to be serious about long-term survival. They better get serious too about changing the system and re-capturing control and eliminating the tyranny. That is the reason we formed Freedom Force International.
Daily Bell: Any new projects you want to tell us about?
G. Edward Griffin: I have been working on a book that is taking forever. It covers some of the things we have been talking about; the tentative title is The Future is Calling. It has to do with this long-term view of history and what we can do about it now and how to prepare for it. Lay the foundations. It has a lot of past history in it to. I don't know when I'll have it done. I thought I would have had it done 2 years ago but I am only 60 or 70% through it. It's an important project to me.
The other thing is, accidentally, I touched a very high voltage wire called Chemtrails. About a year ago, some fellows came over here that were doing research and preparing a documentary on Chemtrails. I always had an interest in it and had a firm conviction that what we see in the sky is Chemtrails, not just contrails.
So, I said yes, and I raised money and produced a documentary called, "What in the world are they spraying?" and that put me in the crosshairs of all of the establishment forces that insist that there are no Chemtrails, that it is just conspiracy theory. So we are thinking about a follow up film right now.
Daily Bell: Any closing thoughts? Any resources you want to mention?
G. Edward Griffin: My only closing thought is that I hope people don't become discouraged about what I have said. I believe my role is to say it like it is, or the way I think it is, to the best of my ability. I am not here to pump sunshine into people. I would rather know what the truth is and that makes me a lot happier than having a false sense of security. I believe we have a great chance to make change as long as we hold that long view of history, and I urge everyone to take advantage of this information. Don't be depressed; get invigorated with this information.
Daily Bell: Thanks again, Ed. We're sure our viewers are as appreciative of your insights as we are.
out to have been correct. There is no defense for the function they perform. Every price-fix is a marketplace distortion. Every marketplace distortion removes wealth from its rightful owner and places it in less responsible hands. Repeat over enough time and you end up with recessions, depressions and ultimately worldwide economics crises such as the one occurring now.
Ed Griffin has fought for freedom throughout his life and his trenchant criticisms of the increasingly authoritarian nature of the world today are more pertinent than ever. When Ed Griffin published his ground-breaking book The Creature From Jekyll Island, most people had never even heard of the Federal Reserve, much less understood its function. Today, the Internet is filled with questions about a globalist banking facility that operates privately under the color of Congressional law with a mandate to print as much money from nothing as necessary to support the questionable activities of the power elite.
Central banks fix the price of money. It's that simple. Ed Griffin turns out to have been correct. There is no defense for the function they perform. Every price-fix is a marketplace distortion. Every marketplace distortion removes wealth from its rightful owner and places it in less responsible hands. Repeat over enough time and you end up with recessions, depressions and ultimately worldwide economics crises such as the one occurring now.
Better to return to marketplace money – or at least allow such money to circulate within a competitive environment of numerous monetary systems. We are on record as preferring gold and silver, which circulate in a metals-based money economy within parameters of supply and demand.
Too much gold and silver circulate and the value of money begins to decline. As little and the value rises. As the value rises, mines open back up and hoarders dishoard. It is a marketplace phenomenon that allows the market itself to govern the money supply.
In our current central banking based system, there is no governor on how much money central banks can print. The Federal Reserve is the worst offender when it comes to money printing because it can print the most with the least amount of consequences. This is because the US operates the world's currency reserve system.
The currency reserve system is actually called the "dollar reserve system." The system is propped up by Saudi Arabian sheiks that have been instructed that they must only exchange their oil for dollars. This makes the dollar the most important currency on the planet and allows the Fed to print virtually as much currency as the US needs because other countries must hold dollars to buy oil.
Much of the money that the US prints is recycled into weapons systems and bases around the world. This military predominance intimidates other countries and guarantees that the dollar remains the currency of choice for oil purchases. Thus is it that the world's economic system is held hostage to American military might. The world, essentially, is paying for the privilege of being held hostage this way.
Ironically, over the past decade, the Fed in particular has so abused its money printing power (in support of America's questionable wars) that other countries are trying to find a substitute for the dollar. The Internet in particular has contributed to a better understanding of how the world's monetary system really works. As this understanding continues to expand, worldwide, there are numerous alternatives being discussed to the dollar reserve system.
Many of the discussions involving a new currency trend toward international currency baskets. There is the suspicion therefore that the Western elites that control the dollar reserve currency have purposefully debased the currency in order to implement a global monetary system. Time will tell whether this suspicion is true or not.
What is certainly true is that central banking and especially the activities of the Federal Reserve are under significant attack on the Internet and even politically by certain segments of political process in America and abroad. This process, abetted by the Internet and the current financial crisis, began nearly 30 years ago with the groundbreaking publication of Ed Griffin's critique of the Fed, "The Creature From Jekyll Island." History will record the growing impact of this book. It already does.
There will be no date, no particular point in history where you can say, “On this date, the New World Order was ushered in.” To a very large extent, we’re already in it. We’ve been in it for a long, long time. What they’re really doing is just building the walls a little bit at a time with the passage of each day, and we’re in it. We will never be able to say, “Gee, it started on this date.” If there was to be a date that historians might want to put on the arrival of this monster, I suppose it would be the date on which all of the nations of the world surrendered control over their money and over their military, because those are the two legs on which national sovereignty stands. If you’ve got a strong military and a strong money system, you’re a sovereign nation. If you don’t have those things, you’re nothing. You’re just a territory that is controlled by someone who does have strong money or a strong military. So we’re very close to the surrender of our money right now. I suppose that would be a date that historians might choose for the crossover point. - G. Edward Griffin, Restore the Republic's Reality Report, May 17, 2009 (video below)
In his speech, Trichet, president of the European Central Bank, acknowledges the role of the G20 in using the financial crisis to mandate developing countries’ “full integration into the institutions of global governance.” Since the enormous EU bailout of Greece, the article below from May makes even more sense now.
Kelley Blogspot May 2, 2010
Secretive Group of International Bankers to form a World Government?
ECB President tells insiders that secretive group of international bankers — responsible to no nation state — will become the primary engine of world government.
In a speech before the elitist Council on Foreign Relations organization in New York earlier this week, President of the European Central Bank Jean-Claude Trichet called for the imposition of global governance to be bossed by the G20 and the corrupt Bank of International Settlements in the name of safeguarding the global economy.
In an address entitled “Global Governance Today,” Trichet proclaims how the elite need to impose “a set of rules, institutions, informal groupings and cooperation mechanisms that we call “global governance.”
During the course of the speech, Trichet uses the term “global governance” well over a dozen times, outlining how “global governance is of the essence” to avoid another financial crisis.
Section one of Trichet’s speech is entitled, “Why we need global governance,” and from then on he constantly invokes the economic downturn as a justification for empowering secretive, undemocratic and corrupt global institutions with the power to rule the world.
Highlights of Trichet’s speech can be viewed below via the official Council on Foreign Relations.
A full transcript of the speech was also carried by the Bank for International Settlements (BIS), an international organization of central banks that has constantly lobbied for a centralized global currency to replace that of nation states. Trichet praises the BIS as being “ahead of the curve” in dealing with the financial crisis during the speech.
The primary outfit that will boss the institutions of global governance, according to Trichet, is the Global Economy Meeting (GEM), which regularly meets at the BIS headquarters in Basel.
This group, states Trichet, “has become the prime group for global governance among central banks.” The GEM is basically a policy steering committee under the umbrella of the Bank for International Settlements.
The BIS is a branch of the of the Bretton-Woods International Financial architecture and closely allied with the Bilderberg Group. It is controlled by an inner elite that represents all the world’s major central banking institutions. John Maynard Keynes, perhaps the most influential economist of all time, wanted it closed down, as it was used to launder money for the Nazis during World War II.
Financial website Investors Insight describe the BIS as “the most powerful bank you’ve never heard of,” labeling it “the most powerful financial institution on earth.”
The bank wields power through its control of vast amounts of global currencies. The BIS controls no less than 7% of the world’s available foreign exchange funds, as well as owning 712 tons of gold bullion.
“By controlling foreign exchange currency, plus gold, the BIS can go a long way toward determining the economic conditions in any given country,” writes Doug Casey. “Remember that the next time Ben Bernanke or European Central Bank President Jean-Claude Trichet announces an interest rate hike. You can bet it didn’t happen without the concurrence of the BIS Board.”
The BIS is basically a huge slush fund for global government through which secret transfers of wealth from citizens are surreptitiously handed to the IMF.
“For example, U.S. taxpayer monies can be passed through BIS to the IMF and from there anywhere. In essence, the BIS launders the money, since there is no specific accounting of where particular deposits came from and where they went,” writes Casey.
“The bank was a major player promoting the adoption of the euro as Europe’s common currency. There are rumors that its next project is persuading the U.S., Canada and Mexico to switch to a similar regional money, perhaps to be called the “amero,” and it’s logical to assume the bank’s ultimate goal is a single world currency. That would simplify transactions and really solidify the bank’s control of the planetary economy,” adds Casey.
The Bank of International Settlements is responsible to no national government whatsoever. Trichet’s acknowledgment that an offshoot of the corrupt BIS will boss the main engine global government is a startling revelation, and emphasizes once again that world government is inherently undemocratic and dictatorial in nature.
The fact that Trichet unveiled this new approach in the march towards global governance before an audience of CFR insiders is fully appropriate.
The Council on Foreign Relations comprises of influential elitists and powerbrokers from all sectors of government, business, academia and the media. It is the public face of the more secretive Bilderberg Group. The CFR only recruits members sympathetic to its agenda for global government and the elimination of U.S. sovereignty.
The scope of the CFR’s mission was best encapsulated by former Deputy Secretary of State under Clinton and CFR luminary Strobe Talbott, who told Time Magazine in July 1992,
“In the next century, nations as we know it will be obsolete; all states will recognize a single, global authority. National sovereignty wasn’t such a great idea after all.”
As we have emphasized, the global elite have already announced the birth of world government and who will run it. People expecting the UN to be at the helm have been distracted as the G20, alongside the BIS, was being empowered with the tools through which global governance is being coordinated.
In his speech, Trichet acknowledges the role of the G20 in using the financial crisis to mandate developing countries’ “full integration into the institutions of global governance.”
“The G20 has been effective in addressing the global crisis. We are now at the stage where this forum is making the transition from acting in a crisis resolution mode to contributing to crisis prevention,” said Trichet.
In other words, the elite exploited the financial crisis in order to allow the G20 to pose as saviors and consequently empower itself to impose global governance regulations on nation states in the name of avoiding another economic crisis.
As EU President Herman Van Rompuy stated during his speech in Brussels, 2009 marked the first official year of world government powers being directly exercised to control the economies of nation states.
“2009 is also the first year of global governance, with the establishment of the G20 in the middle of the financial crisis. The climate conference in Copenhagen is another step towards the global management of our planet,” said Van Rompuy.
A global currency and “a global central bank would be a disaster,” says financial guru Bob Chapman, editor of the International Forecaster. “It means the acceptance of world slavery.” Chapman also pointed out that the present international monetary system was being deliberately destroyed precisely to bring about a global currency like the bancor. “It’s just not fiscal and monetary policy. It is every facet of your life that these elitists want to control.” And they’re moving rapidly toward that goal. In addition to printing money, the emerging global central bank and its affiliates are already usurping other powers traditionally exercised at the national level. CFR insider Jeffrey Garten calls for the new planetary central bank to be the lead regulator of all sorts of financial institutions, monitor risks, push national authorities to modify their policies, coordinate national stimulus programs, orchestrate a global-stimulus plan, force taxpayers around the world to bail out companies, and even act as a bankruptcy court. A lot of that is already coming into being, but as the new monetary order develops, the agenda will only accelerate. And as if all that wasn’t bad enough, there is no accountability for this newly empowered IMF. While the IMF has articles of association and some governance rules, the true power structure behind it is the G20, which is “completely unaccountable.” - Alex Newman, The Emerging Global Fed, The New American, September 16, 2010
The Associated Press October 10, 2010
Global finance leaders failed Saturday to resolve deep differences that threaten the outbreak of a full-blown currency war.
Various nations are seeking to devalue their currencies as a way to boost exports and jobs during hard economic times.The concern is that such efforts could trigger a repeat of the trade wars that contributed to the Great Depression of the 1930s as country after country raises projectionist barriers to imported goods.
The International Monetary Fund wrapped up two days of talks with a communique that pledged to "deepen" its work in the area of currency movements, including conducting studies on the issue.
The communique essentially papered-over sharp differences on currency policies between China and the United States.
The Obama administration, facing November elections where high U.S. unemployment will be a top issue, has been ratcheting up pressure on China to move more quickly to allow its currency to rise in value against the dollar.
American manufacturers contend the Chinese yuan is undervalued by as much as 40 percent and this has cost millions of U.S. manufacturing jobs by making Chinese goods cheaper in the United States and U.S. products more expensive in China.
China has allowed its currency, the yuan, to rise in value by about 2.3 percent since announcing in June that it would introduce a more flexible exchange rate. Most of that increase has come in recent weeks after the Obama administration began taking a more hardline approach and the U.S. House passed tough legislation to impose economic sanctions on countries found to be manipulating their currencies.
Chinese officials continued to insist that their gradual approach to revaluing their currency was best, and that faster movements risked destabilizing the Chinese economy.
Various other nations, including Japan, Brazil and South Korea, also have taken steps to keep their currencies weaker in an effort to increase their exports. And in the United States, expectations of further monetary easing by the Federal Reserve have driven the dollar down significantly against the euro and other major currencies.
Egyptian Finance Minister Youssef Boutros-Ghali told reporters Saturday at a concluding news conference that there were "a number of points of friction" at the meetings. But he said it was a significant achievement that all countries recognized the central role the IMF should play in trying to resolve currency conflicts.
IMF Managing Director Dominique Strauss-Kahn said he did not view the outcome of the discussions as a failure. He said they set the stage for further progress at the upcoming summit of leaders of the Group of 20 nations in November in Seoul and at future IMF meetings.
Strauss-Kahn said the G-20 countries remained committed to the goals they established a year ago of achieving more balanced global growth and that this will require changes in currency policies.
The G-20 includes traditional economic powers such as the United States and Europe along with fast-growing economies such as China, Brazil and India.
"I am not disappointed," Strauss-Kahn told reporters about the outcome of the two days of talks.
Strauss-Kahn acknowledged that significant differences also remained on the question of reforming the IMF by giving China and other fast-growing economic powers greater voting rights and representation on the IMF board. The G-20 leaders are supposed to endorse a deal on IMF reform at their November summit.
Treasury Secretary Timothy Geithner on Wednesday raised the possibility that awarding greater power to China in the IMF should be linked to an increased willingness of that country to reform its currency system.
Strauss-Kahn told reporters Saturday that this comment was not a form of blackmail but rather acknowledgment that as countries grow more important economically, they must bear greater responsibility for the proper functioning of the global economy.
But Oxfam, an international aid group, criticized Geithner's comments.
"The currency war cannot be used to hold IMF reform hostage," said Oxfam spokesperson Pamela Gomez. "The IMF can't do its job unless emerging economies are at the table."
In his comments to the IMF's policy-setting panel on Saturday, Geithner said that the IMF must begin to speak more forcefully about how countries manage their currencies.
The IMF's concluding statement did pledge to work for "stronger and evenhanded surveillance to uncover vulnerabilities in large advanced economies." Strauss-Kahn said he would personally participate in the annual economic reviews of the world's five or six largest economies, a group that would include the United States and China.
But private economists were not impressed with the IMF's new commitments on surveillance.
"The IMF ratcheted up the focus on exchange rate surveillance a few years ago and then eased off under pressure from China," said Eswar Prasad, a trade professor at Cornell University. "Now it is back to reasserting what should have been a core part of its surveillance mandate all along."
While the United States has been leading the charge against China, some other countries voiced their support during the IMF-World Bank meetings.
Olli Rehn, the economic commissioner for the 27-nation European Union, told the IMF committee that it was important that China start "to implement soon a more flexible exchange rate regime."
Canadian Finance Minister James Flaherty told reporters that the global economy would be the loser if nations followed "beggar-thy-neighbor" currency policies that invited retaliation by other nations.
But French Finance Minister Christine Lagarde said Saturday that a successful resolution of the currency dispute with China would require a cooling of over-heated rhetoric about currency wars.
"In a war, there is always a loser and in this situation there must not be a loser," she said.
She said that France, which will serve as leader for the G-20 in 2011, plans a major focus on developing reforms to the international currency system.
"This present window of opportunity, during which a truly peaceful and interdependent world order might be built, will not be open for too long—we are on the verge of a global transformation. All we need is the right major crisis and the nations will accept the New World Order." - David Rockefeller, September 23, 1994
"It cannot happen without U.S. participation, as we are the most significant single component. Yes, there will be a New World Order, and it will force the United States to change its perceptions." - Henry Kissinger, World Affairs Council Press Conference, April 19, 1994
Last year was an absolutely fascinating time for world currency markets. The yen, the dollar and the euro all took their turns in the spotlight. Each experienced wild swings at various times, but the overall theme that we saw was that faith in paper currencies is dying. The biggest reason for this is the horrific sovereign debt crisis that has swept the globe.
The United States, Japan and a whole host of European nations are all drowning in debt. The U.S. and Japan are both steamrolling toward insolvency, and several European nations would have already defaulted on their debts if they had not been bailed out.
So which of the major currencies of the world is going to crash first? Will one (or more) of the big currencies fall before the end of 2011? Once one major currency collapses will the rest start to fall like dominoes? The truth is that the world has never seen a sovereign debt crisis of this magnitude in all of human history. Almost the entire globe is drowning in a sea of red ink and it has brought us right to the brink of financial disaster.
So which of the currencies of the world is going to be the first to come crashing down? Well, let's take a quick look at the yen, the euro and the dollar....
The Yen
Japan has the 3rd biggest economy in the world, but they are also deeply swamped in debt. At well over 200%, the Japanese government has the biggest debt to GDP ratio of all of the major industrialized nations. In fact, it is estimated that this massive pile of Japanese government debt amounts to approximately 7.5 million yen for every person living in the entire nation of Japan.
So why hasn't Japan defaulted yet? Well, a big reason is because Japan has one of the highest personal savings rates on the entire globe, and Japanese citizens have been more than happy to gobble up huge amounts of Japanese government debt at very, very low interest rates.
However, Standard & Poor's has warned that they may have to slash Japan's credit rating if the debt gets much bigger, and once confidence starts to falter Japan is going to have to start paying higher interest rates.
At some point Japan is going to be facing a financial meltdown, but for the moment they are hanging in there.
The Euro
Several large European nations would have already defaulted on their debts if they had not been bailed out last year. Greece, Portugal, Ireland, Italy, Belgium and Spain are all on very shaky ground right now. Several of them have already had their credit ratings slashed.
Bond yields all over Europe have been absolutely soaring in recent months. It is getting really expensive for many of these nations to take on new debt. Interest rates on 10-year Greek bonds went from 6 percent up to 13 percent in just a single month at one point in 2010. In fact, even some of the nations that aren't in the most danger are even feeling the pain. For example, the cost of insuring French debt hit a new record high on December 20th.
Right now there are all kinds of rumblings that more European nations are going to need bailouts very soon. Professor Willem Buiter, the chief economist at Citibank, is warning that quite a few EU nations could financially collapse in the next few months if they are not rapidly bailed out....
"The market is not going to wait until March for the EU authorities to get their act together. We could have several sovereign states and banks going under. They are being far too casual."
So where is all of this bailout money coming from? Well, a lot of it is coming from Germany and a significant amount of it is actually coming from the United States.
But will wealthy nations such as Germany be willing to pour hundreds of billions of euros into these financial black holes indefinitely?
Are the Germans going to accept a situation where they are permanently bailing out the "weak sisters" all over the rest of the continent?
Already some prominent politicians in Europe are calling for the European "bailout fund" to be doubled in size to about 2 trillion dollars. Other analysts believe that it is going to take at least 4 or 5 trillion dollars to properly bail out all of the European nations that need it.
In any event, the truth is that the situation is really, really bad. If at some point the bailouts stop, the defaults are going to begin.
The Dollar
The United States has the biggest national debt of all. The 14 trillion dollar threshold has just been crossed, and the national debt is now less than 300 billion dollars away from the 14.294 trillion dollar debt ceiling. If the U.S. Congress does not raise the debt ceiling, the U.S. government will shortly begin to default on its debts. Of course everyone fully expects that the U.S. Congress will indeed raise the debt ceiling just like they have every time before.
However, U.S. politicians are not going to be able to keep kicking the can down the road forever. Today the U.S. national debt is more than 14 times larger than it was just 30 years ago. Everyone around the world is beginning to realize that this debt is not even close to sustainable. Investors are beginning to become more hesitant about loaning the United States money. The Federal Reserve has been forced to step in and "buy" more and more of the debt the U.S. government is issuing.
Yields on U.S. Treasuries have been moving up in recent months and this could eventually become a huge problem.
Why?
Well, the sad truth is that the U.S. government has been increasingly using short-term debt.
At this point, the average maturity of U.S. government bonds has fallen to 4.4 years. The is the lowest figure of all the major industrialized nations. That means that the U.S. government must constantly roll over massive amounts of debt.
As a point of comparison, UK government debt has an average maturity of approximately 13 years. That obviously gives them a lot more breathing room.
For the United States, the situation could become incredibly dire if interest rates start to go up.
If interest rates on U.S. government debt reach an average of 7 percent, interest payments on the debt would gobble up approximately 45 percent of the tax revenue that the U.S. government takes in each year.
Yes, at that point the game would be over.
But what the United States has going for it that the European nations do not is that the United States can just have the Federal Reserve keep printing currency. Unfortunately for the nations involved in the euro, they do not have that option.
That is why an increasing number of analysts believe that it will be the euro that will crash and burn first.
But only time will tell.
There are even many that believe that authorities at the highest level actually want the dollar, euro and yen to fail.
Why?
Well, many of the same individuals and groups that brought us NAFTA, the WTO, the IMF, the OECD and the World Bank believe that it would be absolutely wonderful for humanity if we could all have a single, united global currency. The "chaos" produced by the fall of our existing global currencies could provide the perfect "opportunity" to provide the grand "solution" that they have been hoping to introduce all along.
All over the world top politicians and financiers have been very open about the fact that a world currency is coming. In fact, men like George Soros are openly talking about these things. The United Nations has been publicly calling for the U.S. dollar to be replaced with a new global currency for some time now. Just this week Chinese President Hu Jintao stated that "the current international currency system is the product of the past."
So will the American people just sit back and accept it when their dollars are replaced with a new global currency?
Well, sadly, when things go badly most Americans seem to be willing to accept just about anything if it will mean that things will go back to "normal". When the global economy falls to pieces, and there already lots of signs that we are on the verge of such a collapse, will the American people be willing to say goodbye to the dollar if politicians from both major political parties tell them that the new global currency is the "answer" to our problems?
Hopefully the American people will wake up and will realize that "globalism" is rapidly wiping away almost everything that it means to be an "American". Now even many of our children and teens are primarily identifying themselves as "citizens of the world" rather than "citizens of the United States".
Even if the U.S. dollar does collapse, it is absolutely imperative that we continue to have our own national currency. The U.S. Constitution does not make any provision for any sort of "world currency". If we allow the globalists to push a truly global currency down our throats it will be another giant step towards the creation of a totalitarian one world system.
So what do you think about all of this? Please feel free to leave a comment with your thoughts below....
2010 was an exciting year for currencies. The dollar, euro, the yen, and the yuan all went under the spotlight. Except for the yuan, each experienced drastic swings wrought about by internal or external factors. But overall, these events underwhelmed confidence in paper money. The main reason is because of the sovereign debt crisis that swept the world.
Most of the developed nations including the United States, Japan, and a number of European countries have unsustainable debt. The US and Japan, for example, are heading towards insolvency. Meanwhile, the only reason why several countries in the EU haven't defaulted is the bail-out by stronger EU members.
This year presents more challenges for the world's major currencies. While the markets are not as nervous at this point, problems remain just beneath the surface. The truth is that the world has not seen a sovereign debt crisis of the magnitude seen last year. With much of the developed world on the red, this has brought the market at the brink of disaster. We'll analyze some of the major currencies in this article including the yen, the euro, and the dollar. Developments in China regarding the yuan will also be discussed.
The Euro
It was all over the news in the later part of 2010. Several weaker members of the Eurozone would have defaulted already if they weren't helped out by stronger members. As it stands right now, Greece, Portugal, Spain, Italy, Ireland, and Belgium are on shaky grounds. A number of countries have had their credit rating slashed, resulting to soaring bond yields that are unsustainable. Taking on new debt has become very expensive.
Greece, the country who was most at risk of default at one point in 2010, saw their yields go up from 6 percent to 13 percent in a single month. Even countries that are not in danger are feeling the effects of the crisis. For instance, the French debt hit a record high on December 20.
Right now, there are rumblings that more European countries may need bailouts to stay afloat. According to Professor Willem Buiter, a chief economist at Citibank, a few EU countries can face financial collapse in the next few months. "The market is not going to wait until March for the EU authorities to get their act together…they are being far too casual."
Where did the bailout money come from? A lot of it comes from Germany but most people don't realize that a significant portion actually came from the United States. But the real question is, are these countries willing to pour in more money to nations on the verge of default? For the German public, they want bailout to weaker neighbors to stop. There are other reasons why continuous bailouts will not work.
Right now, some politicians in Europe are asking for the European "bailout fund" to be doubled to $2 trillion. There are analysts who think that it will require $4 to 5 trillion to help all European nations that need it. Even a country as wealthy as Germany cannot give away billions of euros to its neighbors indefinitely. When the bailout to financial black holes stop, the defaults are likely to begin.
In the Euro Index chart this week, there are a number of bearish signals which can lead to bullish sentiment for the USD index. We have observed that the right shoulder of the bearish formation was invalidated by the buying that occurred at the beginning of this week. However, the price then moved to the rising dashed ling, invalidating the breakout. As a result, the head-and-shoulder formation is still underway, which has bearish implications for the following weeks.
Still, that formation alone doesn't mean that euro will be the first major currency to crash. There are also other candidates…
Japanese Yen
Although Japan has the third largest economy, they are swamped with debt. The Japanese government has the highest debt to GDP ratio at 200% of all major industrialized countries. It is estimated that with this amount of debt, every person living in Japan right now owes around 7.5 million yen. Any other country would have defaulted. The main reason why Japan hasn't yet is the high amount of personal savings rate of its citizens. The Japanese citizens are buying massive amounts of government debt at very low interest rates.
Despite this, the debt level is worrying. Standard & Poor has said they will slash the country's credit rating if the debt gets any bigger. If confidence starts to falter, Japan has to pay significantly higher interest rates. At some point, Japan will have to face the threat of a meltdown unless drastic actions are taken.
The US Dollar
No one can argue that the United States is indeed in trouble. It has the largest national debt of all. With its national debt at $14 trillion, it is just $300 billion away from the $14.294 debt ceiling. If Congress fails to raise the debt ceiling, the US government will begin to default. While everyone fully expects this to be increased, the US cannot continue raising this threshold forever.
The US national debt is now 14 times higher than 30 years ago. Everyone is realizing that this level of debt is not sustainable. The Federal Reserve has already stepped in and "bought" more debt for the US government. Treasury yields have been moving up, potentially starting a massive problem in the future. This is mainly because the United States is increasingly relying on short-term debt.
Average maturity for US government bonds is now 4.4 years. As a comparison, the maturity of UK government debt is around 13 years. The situation can be dire if interest rates continue to climb. But there is one thing going for the United States: The Federal Reserve. It can keep on printing money and because the dollar is a global reserve currency, there is demand for it. But this can change quickly - and the consequences will be seen all around the Globe.
The Chinese Yuan
China is increasing its gold and silver reserves in line with its plan to globalize the yuan. The report published by the Economic Information Daily, the People's Bank of China - the country's central bank - is chalking up plans to buy gold and silver reserves when the prices are down.
A number of analysts predict that the Chinese yuan might overtake the US dollar as the global currency in a few years; one of them is global commodities expert Jim Rogers. He believes that the Chinese yuan will eventually dominate the currency market. China is already the largest producer of gold.
Last year, officials have announced that they will increase reserves to the tune of 10,000 tons over the next decade; the country's reserves currently stands at 1,200 tons. Chinese central bank adviser Xia Bin has confirmed that China must increase its gold and silver reserves. According to the report, "increasing gold reserve at the time of prices dip is the strategy of internationalizing the yuan."
There were rumors that the People's Bank of China will bid for IMF gold reserves but this did not happen in 2010. The main reason may be that bullion prices climbed by 30% last year aided by the depreciation of the US dollar against other major currencies, the European debt crisis, and strong demand from India due to festivals and other occasions. The investment appeal of precious metals also surged as investors sought to protect their wealth in an uncertain environment.
In essence, what China wants to happen is to stabilize its currency. By making the yuan internationally tradable, its dependence on the dollar will be dramatically reduced. Hwang Il Doo of the Korean Exchange Bank Futures Co. said that while "the report is a positive factor for gold prices in the mid-and-long term", it won't have an "immediate impact on prices as gold's gain has more to do with the unrest in Egypt at the moment."
Can this be the Start of a Global Currency?
Concerns about the stability of currencies have improved the appeal of a united global currency. The same groups and individuals who thought up the WTO, IMF, OECD, and World Bank believe that the uncertainty produced by shaky world economy presents the perfect "opportunity" to introduce a world currency. Chinese President Hu Jintao has said that the "current international system is the product of the past."
Whether this comes to fruition or not remains to be seen. The United States has the most to lose if this happens. Certainly, American policymakers will certainly try to find a remedy. However, the problem is, the country might eventually be too deep in debt to do something about it.
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Excerpt from "The Global Economic Crisis: The Great Depression of the XXI Century"
By Ellen Brown
The following is an excerpt of a chapter by Ellen Brown from the new book by Global Research Publishers, "The Global Economic Crisis: The Great Depression of the XXI Century."
Is the Group of Twenty Countries (G20) envisaging the creation of a Global Central bank? Who or what would serve as this global central bank, cloaked with the power to issue the global currency and police monetary policy for all humanity? When the world’s central bankers met in Washington in September 2008 at the height of the financial meltdown, they discussed what body might be in a position to serve in that awesome and fearful role. A former governor of the Bank of England stated:
The answer might already be staring us in the face, in the form of the Bank for International Settlements (BIS)... The IMF tends to couch its warnings about economic problems in very diplomatic language, but the BIS is more independent and much better placed to deal with this if it is given the power to do so.[1]
And if the vision of a global currency outside government control was not enough to set off conspiracy theorists, putting the BIS in charge of it surely would be. The BIS has been scandal-ridden ever since it was branded with pro-Nazi leanings in the 1930s. Founded in Basel, Switzerland, in 1930, the BIS has been called “the most exclusive, secretive, and powerful supranational club in the world.” Charles Higham wrote in his book Trading with the Enemy that by the late 1930s, the BIS had assumed an openly pro-Nazi bias, a theme that was expanded on in a BBC Timewatch film titled “Banking with Hitler” broadcast in 1998.[2] In 1944, the American government backed a resolution at the Bretton Woods Conference calling for the liquidation of the BIS, following Czech accusations that it was laundering gold stolen by the Nazis from occupied Europe; but the central bankers succeeded in quietly snuffing out the American resolution.[3]
In Tragedy and Hope: A History of the World in Our Time (1966), Dr. Carroll Quigley revealed the key role played in global finance by the BIS behind the scenes. Dr. Quigley was Professor of History at Georgetown University, where he was President Bill Clinton’s mentor. He was also an insider, groomed by the powerful clique he called “the international bankers.” His credibility is heightened by the fact that he actually espoused their goals. Quigley wrote:
I know of the operations of this network because I have studied it for twenty years and was permitted for two years, in the early 1960’s, to examine its papers and secret records. I have no aversion to it or to most of its aims and have, for much of my life, been close to it and to many of its instruments... In general my chief difference of opinion is that it wishes to remain unknown, and I believe its role in history is significant enough to be known...
The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent private meetings and conferences. The apex of the system was to be the Bank for International Settlements in Basel, Switzerland, a private bank owned and controlled by the world’s central banks which were themselves private corporations.[4]
The key to their success, said Quigley, was that the international bankers would control and manipulate the money system of a nation while letting it appear to be controlled by the government.
The statement echoed one made in the 18th century by the patriarch of what became the most powerful banking dynasty in the world. Mayer Amschel Bauer Rothschild is quoted as saying in 1791: “Allow me to issue and control a nation’s currency, and I care not who makes its laws.” Mayer’s five sons were sent to the major capitals of Europe – London, Paris, Vienna, Berlin and Naples – with the mission of establishing a banking system that would be outside government control. The economic and political systems of nations would be controlled not by citizens but by bankers, for the benefit of bankers.
Eventually, a privately-owned “central bank” was established in nearly every country. This central banking system has now gained control over the economies of the world. Central banks have the authority to print money in their respective countries, and it is from these banks that governments must borrow money to pay their debts and fund their operations. The result is a global economy in which not only industry but government itself runs on “credit” (or debt) created by a banking monopoly headed by a network of private central banks. At the top of this network is the BIS, the “central bank of central banks” in Basel.
Behind the Curtain
For many years the BIS kept a very low profile, operating behind the scenes in an abandoned hotel. It was here that decisions were reached to devalue or defend currencies, fix the price of gold, regulate offshore banking, and raise or lower short-term interest rates. In 1977, however, the BIS gave up its anonymity in exchange for more efficient headquarters. The new building has been described as “an eighteen story-high circular skyscraper that rises above the medieval city like some misplaced nuclear reactor.” It quickly became known as the “Tower of Basel.” Today the BIS has governmental immunity, pays no taxes, and has its own private police force.[5] It is, as Mayer Rothschild envisioned, above the law.
The BIS is now composed of 55 member nations, but the club that meets regularly in Basel is a much smaller group; and even within it, there is a hierarchy. In a 1983 article in Harper’s Magazine called “Ruling the World of Money,” Edward Jay Epstein wrote that where the real business gets done is in “a sort of inner club made up of the half dozen or so powerful central bankers who find themselves more or less in the same monetary boat” – those from Germany, the United States, Switzerland, Italy, Japan and England. Epstein said:
The prime value, which also seems to demarcate the inner club from the rest of the BIS members, is the firm belief that central banks should act independently of their home governments... A second and closely related belief of the inner club is that politicians should not be trusted to decide the fate of the international monetary system.[6]
In 1974, the Basel Committee on Banking Supervision was created by the central bank Governors of the Group of 10 nations (now expanded to twenty). The BIS provides the twelve-member Secretariat for the Committee. The Committee, in turn, sets the rules for banking globally, including capital requirements and reserve controls. In a 2003 article titled “The Bank for International Settlements Calls for Global Currency,” Joan Veon wrote:
The BIS is where all of the world’s central banks meet to analyze the global economy and determine what course of action they will take next to put more money in their pockets, since they control the amount of money in circulation and how much interest they are going to charge governments and banks for borrowing from them...
When you understand that the BIS pulls the strings of the world’s monetary system, you then understand that they have the ability to create a financial boom or bust in a country. If that country is not doing what the money lenders want, then all they have to do is sell its currency.[7]
The Controversial Basel Accords
The power of the BIS to make or break economies was demonstrated in 1988, when it issued a Basel Accord raising bank capital requirements from six percent to eight percent. By then, Japan had emerged as the world’s largest creditor; but Japan’s banks were less well capitalized than other major international banks. Raising the capital requirement forced them to cut back on lending, creating a recession in Japan like that suffered in the U.S. today. Property prices fell and loans went into default as the security for them shriveled up. A downward spiral followed, ending with the total bankruptcy of the banks. The banks had to be nationalized, although that word was not used in order to avoid criticism.[8]
Among other “collateral damage” produced by the Basel Accords was a spate of suicides among Indian farmers unable to get loans. The BIS capital adequacy standards required loans to private borrowers to be “risk-weighted,” with the degree of risk determined by private rating agencies; farmers and small business owners could not afford the agencies’ fees. Banks therefore assigned one hundred percent risk to the loans, and then resisted extending credit to these “high-risk” borrowers because more capital was required to cover the loans. When the conscience of the nation was aroused by the Indian suicides, the government, lamenting the neglect of farmers by commercial banks, established a policy of ending the “financial exclusion” of the weak; but this step had little real effect on lending practices, due largely to the strictures imposed by the BIS from abroad.[9]
Economist Henry C K Liu has analyzed how the Basel Accords have forced national banking systems “to march to the same tune, designed to serve the needs of highly sophisticated global financial markets, regardless of the developmental needs of their national economies.” He wrote:
National banking systems are suddenly thrown into the rigid arms of the Basel Capital Accord sponsored by the Bank of International Settlement (BIS), or to face the penalty of usurious risk premium in securing international interbank loans... National policies suddenly are subjected to profit incentives of private financial institutions, all members of a hierarchical system controlled and directed from the money center banks in New York. The result is to force national banking systems to privatize...
BIS regulations serve only the single purpose of strengthening the international private banking system, even at the peril of national economies... The IMF and the international banks regulated by the BIS are a team: the international banks lend recklessly to borrowers in emerging economies to create a foreign currency debt crisis, the IMF arrives as a carrier of monetary virus in the name of sound monetary policy, then the international banks come as vulture investors in the name of financial rescue to acquire national banks deemed capital inadequate and insolvent by the BIS.
Ironically, noted Liu, developing countries with their own natural resources did not actually need the foreign investment that trapped them in debt to outsiders: "Applying the State Theory of Money [which assumes that a sovereign nation has the power to issue its own money], any government can fund with its own currency all its domestic developmental needs to maintain full employment without inflation."[10]
When governments fall into the trap of accepting loans in foreign currencies, however, they become “debtor nations” subject to IMF and BIS regulation. They are forced to divert their production to exports, just to earn the foreign currency necessary to pay the interest on their loans. National banks deemed “capital inadequate” have to deal with strictures comparable to the “conditionalities” imposed by the IMF on debtor nations: “escalating capital requirement, loan write-offs and liquidation, and restructuring through selloffs, layoffs, downsizing, cost-cutting and freeze on capital spending.” Liu wrote:
Reversing the logic that a sound banking system should lead to full employment and developmental growth, BIS regulations demand high unemployment and developmental degradation in national economies as the fair price for a sound global private banking system.[11]
The Last Domino to Fall
While banks in developing nations were being penalized for falling short of the BIS capital requirements, large international banks managed to skirt the rules, although they actually carried enormous risk because of their derivative exposure. The mega-banks took advantage of a loophole that allowed for lower charges against capital for “off-balance sheet activities.” The banks got loans off their balance sheets by bundling them into securities and selling them off to investors, after separating the risk of default out from the loans and selling it off to yet other investors, using a form of derivative known as “credit default swaps.”
It was evidently not in the game plan, however, that U.S. banks should escape the regulatory net indefinitely. Complaints about the loopholes in Basel I prompted a new set of rules called Basel II, which based capital requirements for market risk on a “Value-at-Risk” accounting standard. The new rules were established in 2004, but they were not levied on U.S. banks until November 2007, the month after the Dow passed 14 000 to reach its all-time high. On November 1, 2007, the Office of the Controller of the Currency “approved a final rule implementing advanced approaches of the Basel II Capital Accord.”[12] On November 15, 2007, the Financial Accounting Standards Board or FASB, a private organization that sets U.S. accounting rules for the private sector, adopted FAS 157, the rule called “mark-to-market accounting.”[13] The effect on U.S. banks was similar to that of Basel I on Japanese banks: they have been struggling to survive ever since.[14]
The mark-to-market rule requires banks to adjust the value of their marketable securities to the “market price” of the security.[15] The rule has theoretical merit, but the problem is timing: it was imposed ex post facto, after the banks already had the hard-to-market assets on their books. Lenders that had been considered sufficiently well capitalized to make new loans suddenly found they were insolvent; at least, they would have been if they had tried to sell their assets, an assumption required by the new rule. Financial analyst John Berlau complained in October 2008:
Despite the credit crunch being described as the spread of the ‘American flu,’ the mark-to-market rules that are spreading it were hatched [as] part of the Basel II international rules for financial institutions. It’s just that the U.S. jumped into the really icy water last November when our Securities and Exchange Commission and bank regulators implemented FASB’s Financial Accounting Standard 157, which makes healthy banks and financial firms take a ‘loss’ in the capital they can lend even if a loan on their books is still performing, even when the ‘market price’ [of] an illiquid asset is that of the last fire sale by a highly leveraged bank. Late last month, similar rules went into effect in the European Union, playing a similar role in accelerating financial failures...
The crisis is often called a ‘market failure,’ and the term ‘mark-to-market’ seems to reinforce that. But the mark-to-market rules are profoundly anti-market and hinder the free-market function of price discovery... In this case, the accounting rules fail to allow the market players to hold on to an asset if they don’t like what the market is currently fetching, an important market action that affects price discovery in areas from agriculture to antiques.[16]
Imposing the mark-to-market rule on U.S. banks caused an instant credit freeze, which proceeded to take down the economies not only of the U.S. but of countries worldwide. In early April 2009, the mark-to-market rule was finally softened by the FASB; but critics said the modification did not go far enough, and it was done in response to pressure from politicians and bankers, not out of any fundamental change of heart or policies by the BIS or the FASB. Indeed, the BIS was warned as early as 2001 that its Basel II proposal was “procyclical,” meaning that in a downturn it would only serve to make matters worse. In a formal response to a Request for Comments by the Basel Committee for Banking Supervision, a group of economists stated:
Value-at-Risk can destabilize an economy and induce crashes when they would not otherwise occur... Perhaps our most serious concern is that these proposals, taken altogether, will enhance both the procyclicality of regulation and the susceptibility of the financial system to systemic crises, thus negating the central purpose of the whole exercise. Reconsider before it is too late.[17]
The BIS did not reconsider, however, even after seeing the devastation its regulations had caused; and that is where the conspiracy theorists came in. Why did the BIS sit idly by, they asked, as the global economy came crashing down? Was the goal to create so much economic havoc that the world would rush with relief into the waiting arms of a global economic policeman with its privately-created global currency?
Notes
[1] Andrew Gavin Marshall, “The Financial New World Order: Towards a Global Currency and World Government”, Global Research, http://www.globalresearch.ca/index.php?context=va&aid=13070, 6 April 2009. See also Chapter 17.
[2] Alfred Mendez, “The Network”, The World Central Bank: The Bank for International
By Lorimer Wilson Originally Published on March 26, 2006
On March 4, 2006, I posted up the Ominous Warnings and Dire Predictions of World's Financial Experts part 1—an article that consolidated various economic warnings as stated by many of the worlds leading financial experts. The experts suggest that our economic future is not what it seems, and the US economy could be headed for disaster. Later, (on March 10th) a related article was released Warning! Fiscal Hurricane Approaching! Is Your Portfolio Secure?. This article provided several expert opinions on investment options--that they feel can help folks weather the storm ahead. Today, I found the latest release from Dudley Baker and Lorimer Wilson (the authors of the previous articles) and thought many of you would be interested in reading it: Ominous Warnings and Dire Predictions of Financial Experts, Part 2. This new article discusses US Debt, the dollar, the housing bubble, inflation, systemic banking crisis, stock market crash, depression, etc. - economicrot
Widening Global Imbalances
Rodrigo de Rato, Managing Director of the International Monetary Fund at a recent speech at the University of California at Berkeley, stated that:
“While global current account imbalances have been widening, the fact that they have been financed easily thus far seems to be inducing a sense of complacency among policy makers. I think they should be more concerned. This is not to say that the risk of a disorderly adjustment is imminent, but the problem is growing, and if a disorderly adjustment does take place, it will be very costly and disruptive to the world economy.
“The most visible aspect of the global imbalances problem is a very large deficit in the current account of the balance of payments of the United States – amounting to about 6.25% of GDP. The main problem is that in the United States savings are too low. These global imbalances could unwind quickly, and in a very disruptive way, with either an abrupt fall in the rate of consumption growth (i.e. increased savings) in the United States which is holding up the world economy or by investors abroad becoming unwilling to hold increasing amounts of U.S. financial asset, and demand higher interest rates and a depreciation of the U.S. dollar, which in turn forces U.S. domestic demand to contract.”
Economic Pain
Timothy Adams, Undersecretary of Treasury for International Affairs, stated recently that,
“The world economy is dangerously imbalanced and the U.S. current account deficit is now at levels that many experts fear could trigger a run on the dollar, soaring interest rates, and global economic pain.”
Severe Consequences
Robert E. Rubin, director of Citigroup Inc. and former Secretary of the Treasury; Peter Orszag, Senior Fellow at Brookings Institution; and Allen Sinai, Chief Global Economist at Decision Economics Inc., made a presentation to a joint session of the American Economic Foundation and the North American Economics and Finance Association recently. They stated that,
“The scale of the nation’s projected budgetary imbalances is now so large that the risk of severe consequences must be taken very seriously. Continued substantial deficits could cause a fundamental shift in market expectations and a related loss of confidence both at home and abroad. This, in turn, could cause investors and creditors to reallocate funds away from dollar-based investments, causing a depreciation of the exchange rate, and to demand sharply higher interest rates on U.S. government debt. The increase of interest rates, depreciation of the exchange rate, and the decline in confidence could reduce stock prices and household wealth, raise the cost of financing to business, and reduce private-sector domestic spending.”
Wild Ride
Paul Kasriel, Director of Economic Research at Northern Trust and co-author of the book ‘Seven Indicators That Move markets’, has stated that,
“If foreign creditors should question our ability and willingness to repay them without resorting to the currency printing press, there could be a run on the dollar, which would lead to sharply higher U.S. interest rates, which would do great harm to household finances and the housing market, which would put a crimp in consumer spending, which would increase unemployment, which would result in a spike in mortgage defaults, which would likely cripple the banking system given that a record 61% of total bank credit is mortgage related, which would, in turn, render future Fed interest rate cuts -- expected on or about September 20th, 2006 -- less potent in reviving the economy.
“We have the most highly leveraged economy in the postwar period and the Fed is still raising rates and in the past 30 years or so, whenever the Fed has raised interest rates, we have usually had financial accidents. Our federal government is spending like a drunken sailor so my advice is to put on your safety harness as it is going to be a wild ride. My bet is that we are going to end up on the rocks.”
Category 6 Fiscal Storm
Isabel V. Sawhill, Vice President and Director and Alice M. Rivlin, Senior Fellow of Economic Studies at the Brookings Institution have said that,
“The federal budget deficits pose grave risks – a category 6 fiscal storm – to the U.S. economy. The current course is simply not sustainable. Promises to the elderly, especially about medical care, cannot be kept unless taxes are raised to levels that are unprecedented or other activities of the government are slashed. Postponing such action would be reckless and short-sighted.
“Massive amounts of capital have flowed in from around the world, financing much of America’s federal deficit, as well as its international (or current account) deficit. While this inflow of foreign capital has kept investment in the American economy strong it means that Americans are accumulating obligations to service these debts and repay foreigners out of their future income.
As a result, the future income available to Americans will be lower than it would have been without the government deficits. Foreign borrowing also makes the United States vulnerable to the changing whims of foreign investors. There is a risk that Asian central banks, or other large purchasers of dollar securities, will lose confidence in the ability of the United States to manage its fiscal affairs prudently and shift their purchases to euros or other currencies. Such a shift could precipitate a sharp fall in the value of the dollar, which could cause a spike in interest rates, a plunge in the stock and bond markets, and possibly a severe recession. The risk of such a meltdown is unknown, but it seems foolish to run the risk in order to perpetuate large fiscal deficits, which will ultimately reduce Americans’ standard of living.”
Drastic Fall
Sebastian Edwards, the Henry Ford ll Professor of International Business Economics at UCLA’s Anderson School of Management and a research associate of the National Bureau of Economic Research and has been a consultant to the Inter-American Development Bank, the World Bank, the OECD and a number of national and international corporations, has stated that,
“The future of the U.S. current account -- and thus of the dollar -- depend on whether foreign investors will continue to add U.S. assets to their investment dollars. Any major reduction in the USA’s ability to obtain sufficient foreign financing would cause the dollar to fall by 21% to 28% during the first three years of any adjustment period, cause a deep GDP growth reduction, and push the USA into recession.”
Substantial Macroeconomic Consequences
Ian Morris, Chief U.S. Economist at HSBC, has said that,
“About half the U.S. housing market may be overvalued by as much as 35-40%. When these housing bubbles begin to deflate, it is likely to have a substantial macroeconomic consequence.”
Serious Collapse
Ian Shepherdson, Chief U.S. Economist for High Frequency Economics, has warned that,
“House price increases are going to slow much further dragging down expectations for future price gains and therefore raising real mortgage rates. This, in turn, will be the trigger for a serious collapse in home sales. The housing market is a bubble, and it will burst.”
Economic Earthquake
Robert R. Prechter, President of Elliott Wave International and author of ‘At the Crest of the Tidal Wave’ and ‘Conquer the Crash,’ calls for “a slow motion economic earthquake that will register 11 on the financial Richter scale.
“The Great Asset Mania of recent years is in its final euphoric months and the next event will be a sharp decline of historic proportion in stock prices - the Dow should fall to below the starting point of its mania which was 777 in August 1982 and probably below 400 by no later than 2008 - resulting in a deep economic depression lasting until about 2011. If an across-the-board deflation occurs, which has a substantial probability, then real estate, commodities and all bonds issued by other than those rated AAA will fall in value as well.
“That we are in the midst, and apparently near the end, of the greatest debt build-up in world history suggests that the resulting deflation and depression will be the biggest deflation in history by a huge margin. A corollary of deflation will be a soaring value for the U.S. dollar, contrary to virtually all current expectations. Credit expansion is a major reason why stocks have kept rising and the dollar has kept falling but when the bubble begins to deflate, the investment markets will go down and the dollar will start up. The period after the market crash will be the most vulnerable in terms of the potential for hyperinflation. The ultimate result will be the destruction of any value remaining in bonds and the wipe-out of all dollar-denominated paper assets.”
Giant Speculative Bubble
Ravi Batra, Professor of Economics at Southern Methodist University, in his book ‘The Crash of the Millennium’ foresees not a deflationary depression but an inflationary one. He sees:
“The giant speculative bubble that we are currently in bursting, the stock market crashing and then the U.S. dollar collapsing almost immediately followed by a rise in interest rates and plunging bond prices culminating in a depression made doubly damaging by rising inflation through the early part of this decade. In spite of the inflationary nature of the coming depression, property values will tumble in most parts of the United States. In the long run, home prices will probably continue to climb but in the short run, however, they could sink and sink hard.”
Systemic Banking Crisis
Richard Duncan, a former consultant for the International Monetary Fund, current Financial Sector Specialist (Asia) at the World Bank and author of the book, ‘The Dollar Crisis’, writes that,
“The United States’ net indebtedness to the rest of the world, already at record highs, will continue to increase every year into the future until a sharp fall in the value of the dollar against the currencies of all its major trading partners puts an end to the gapping U.S. current account deficit or until the United States is so heavily indebted to the rest of the world that it become incapable of servicing the interest on its multi-trillion dollar debt.
“In the meantime, as long as the U.S. current account deficit continues to flood the world with U.S. dollar liquidity, new asset price bubbles are likely to inflate and implode; more systemic banking crises can be expected to occur; and intensifying deflationary pressure can be anticipated as low interest rates and easy credit result in excess industrial capacity and falling prices (i.e. deflation).”
Conclusion
The above comments are from some of the best minds in the business and what they have said about our current financial situation and what is in store for us in the years ahead. We advise investors to listen, to learn and to recognize the need to be strategically positioned in a wide variety of assets including precious metals, mining shares and long-term warrants. Nothing like taking what the experts say to heart and investing accordingly.
Alan Greenspan, an 'original gold bug' and former Chairman of the Federal Reserve, is going to say "I told you so!" as soon as he feels at liberty to comment further on what he already warned us might/will happen to the economy. He will no doubt expand on what he saw as the:
a) potential for a derivative crisis - "I would suspect there are potential disasters running into … the hundreds."
b) potential drop in asset prices - "This vast increase in the market value of asset claims [stocks, bonds, houses] is in part the indirect result of investors accepting lower compensation for risk. Such an increase in market value is too often viewed by market participants as structural and permanent. But what they perceive as newly abundant liquidity can readily disappear … history has not dealt kindly with the aftermath of protracted periods of low risk premiums."
c) housing bubble - "Nearer term, the housing boom will inevitably simmer down. As part of that process, house turnover will decline from currently historic levels, while home price increases will slow and prices could even decrease. As a consequence, home equity extraction will ease and with it some of the strength in personal consumption expenditures."
d) coming crisis in Social Security - "The imbalance in the federal budgetary situation, unless addressed soon, will pose serious long-term fiscal difficulties. Our demographics - especially the retirement of the baby-boom generation beginning in just a few years - mean that the ratio of workers to retirees will fall substantially. Without corrective action, this development will put substantial pressure on our ability in coming years to provide even minimal government services while maintaining entitlement benefits at their current level, without debilitating increases in tax rates. The longer we wait before addressing these imbalances, the more wrenching the fiscal adjustment ultimately will be." "When you do the arithmetic of what the rising debt level implied by the deficits tells you and add interest costs to that ever-rising debt at ever-higher interest rates, the system becomes fiscally destabilizing. What you will end up with is a stagnant economic system."
e) oil supply risk - "The current situation reflects an increasing fear that existing reserves and productive crude oil capacity have become subject to potential geopolitical adversity. These anxieties are not frivolous given the stark realities evident in many areas of the world."
f) rising budget deficit - "Large deficits result in rising interest rates and ever-growing interest payments that augment deficits in future years. Unless that trend is reversed, at some point these deficits would cause the economy to stagnate or worse." "Monetary policy, for example, cannot ignore the potential inflationary pressures inherent in our current fiscal outlook, especially those that could rise in meeting commitments to future retirees. However, I assume that these imbalances will be resolved before stark choices again confront us and that, if they are not, the Fed would resist any temptation to monetize future fiscal deficits. We had too much experience with the dangers of inflation in the 1970s to tolerate going through another bout of dispiriting stagflation. The consequences for both future workers and retirees could be daunting."
g) rising long-term interest rates - "The fiscal issues that we face pose long-term challenges, but federal budget deficits could cause difficulties even in the near term. Rising interest rates have been advertised for so long and in so many places that anyone who hasn't appropriately hedged his position by now is desirous of losing money."
h) record-high current account deficit - "Given the already substantial accumulation of dollar-dominated debt, foreign investors, both private and official, may become less willing to absorb ever-growing claims on US residents….Net claims against residents of the United States cannot continue to increase forever in international portfolios at their recent pace…Given the size of the US current account deficit, a diminished appetite for adding to dollar balances must occur at some point. The trade deficit cannot continue to increase forever at the recent pace.
i) excessive household debt - Debt in modest quantities does enhance the rate of growth of an economy and does create higher standards of living, but in excess, creates very serious problems.
j) falling U.S. dollar - Although I doubt that the U.S. dollar will lose its status as the world's reserve currency any time soon, there are in my judgment lessons to be learned from the experience of sterling as it faded as the world's dominant currency."
It is interesting to note that at one time Greenspan was an ardent gold bug and a true believer in the gold standard as his following words attest:
"In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of the insidious process."
Deep Funk
Richard Fisher, President of the Dallas Federal Reserve, noted on Feb.6, 2006 that,
"U.S. consumer spending could suffer if the property market cools too fast but that is unlikely because of the high number of home owners with fixed rate mortgages acting as a buffer against the small fraction of those with variable rate mortgages. It is not unreasonable to think the situation is manageable, albeit worth watching closely."
Regarding the record U.S. current account deficit he said:
"Those urging the United States to rein in its spending should be equally full-throated in prodding countries with excess savings and trade surpluses to create conditions for growing their domestic demand. If they fail to do so, and the U.S. suddenly becomes more virtuous on its own, the global economy could sink into a deep funk."
Financial Disaster
Paul Volker, a former Federal Reserve Board Chairman, is on record as saying:
"I think we are skating on increasingly thin ice. On the present trajectory, the deficits and imbalances will increase. At some point, the sense of confidence in capital markets that today so benignly supports the flow of funds to the United States and the growing economy could fade. Then some event, or combination of events, could come along to disturb markets, with damaging volatility in both exchange markets and interest rates. Indeed, there is a 75% chance of a major financial disaster within the next few years."
Great Disruption
David Dodge, Governor of the Bank of Canada, earlier this month said:
"Global imbalances, such as the record U.S. current account deficit and the ballooning surpluses in some Asian countries, are persisting and if not resolved in an orderly way, we face the threat of great disruption with periods of outright recession."
Economic Armageddon
Stephen Roach, Managing Director, Chief Economist, and Director of Global Economic Analysis of Morgan Stanley, has stated that,
"America's record trade deficit means the dollar will keep falling, interest rates will rise further and U.S. consumers, in debt up to their eyeballs, will get pounded with no better than a 10% chance of avoiding economic Armageddon."
Financial Apocalypse
Kurt Richebacher, former Chief Economist of the Dresdner Bank, has stated that "the bubble-driven consumer-spending boom we are currently in represents artificial, unsustainable demand and further rate hikes by the Fed will prick both the carry trade bubble in bonds and the bubble in housing. A financial Apocalypse will follow. The U.S. economy will lose its chief liquidity source with disastrous effects on a wide range of asset prices.
The U.S. has such serious structural problems they preclude any possibility of a sustained economic recovery. These structural problems include a corporate profits decline, a record savings shortfall, a capital spending collapse, an unprecedented consumer borrowing and spending binge, a massive current account deficit, ravaged balance sheets and record high debt levels. Tops among them are the depression of profits and capital spending which will propel each other downward in a vicious spiral.
In addition, U.S. stocks are still overvalued. The worst part of the bear markets is still to come and it will result in the wholesale destruction of the financial wealth derived from the bubble economy.
The U.S. financial system today is a house of cards built on nothing but financial leverage, credit excess, speculation and derivatives. A recession is coming and it will prove unusually severe and long. The length and severity of recessions or depressions depend critically on the magnitude of the dislocations and imbalances that have accumulated in the economy during the preceding boom and, as such, the U.S. economy is in for a very hard landing. The excessive monetary looseness has only postponed and magnified the coming inevitable crisis.
Growing disillusionment with the U.S. economy is the trigger. The huge capital inflows have become the U.S. financial markets' single most important pillar. Take this pillar away, and those markets will instantly collapse with devastating effects for the U.S. economy, turning quickly into a savage credit crunch. The exposure of the U.S. financial markets to foreign investors and lenders has grown to such preposterous magnitude during recent years that a controlled gradual dollar devaluation no longer appears feasible. The dangers that loom on the currency front are immense. The grossly over-leveraged U.S. financial system is hostage to a strong dollar and permanent, huge capital inflows. The U.S. trade deficit and the accumulated foreign indebtedness have reached a scale that defies any possible action by central banks. The fate of the dollar is beyond any control.
Financial Train Wreck
Nouriel Roubini is Professor of Economics and International Business at New York University's Stern School of Business; Chairman of Roubini Global Economics; Research Fellow at the National Bureau of Economic Research; Research Fellow of the Centre for Economic Policy Research; Member of the Bretton Woods Committee, the Council on Foreign Relation's Roundtable on the International Economy and the Academic Advisory Committee, Fiscal Affairs Department of the International Monetary Fund; former Senior Economist for International Affairs on the Staff of the United States President's Council of Economic Advisors; and co-author of several books on the economy.
Roubini has stated that,
"If the US does not take policy steps to reduce its need for external financing, before it exhausts the world's central banks willingness to keep adding to their dollar reserves then the large, growing and unsustainable fiscal deficit and U.S. current account deficit will become twin financial train wrecks for the U.S. economy and will lead to a sharp hard landing of the dollar, a sharp increase in long term interest rates, a significant increase in the inflation rate and a sharp slowdown of the U.S. and global economy.
"A dollar crash/hard landing would be associated with a bond market rout and would have serious consequences on all other risky and overvalued assets (equities, housing, high-yield debt, emerging market debt).
"The effects in the US of higher short and long rates on the housing market, both flows of new housing and new home demand on the value of existing housing, would likely be severe.
"Oil prices will skyrocket above $100 per barrel. Then we will get a U.S. and global recession that will pale compared to the one in 1980-82.
"I am not being alarmist or unrealistic when you consider our reckless fiscal and public debt policies, the absence of adult policy supervision in Washington and the mediocre or nonexistent US economic leadership."
Demographic Tsunami
David Walker, Director of the U.S. General Accounting Office and Comptroller general of the United States, has stated that,
"Our projected budget deficits are not manageable without significant changes in status quo programs, policies, processes and operations and were such action implemented it would most likely adversely affect the quality of life of every American now and in the foreseeable future. The U.S. faces a demographic tsunami that will never recede."
Thanks Mr. Wilson for this Part 1 summary of what some of the best minds have said about our current financial situation and what is in store for us in the years ahead. As we understand it you are strategically positioned in a wide variety of assets including precious metals, mining shares and long-term warrants. Nothing like taking what the experts say to heart and investing accordingly.
Dudley Baker is the owner/editor of Precious Metals Warrants, a market data service which provides you with the details on all mining & energy companies with warrants trading on the U. S. and Canadian Exchanges. As new warrants are listed for trading we alert you via an e-mail blast. You are provided with links to the companies' websites, links to quotes and charts, tips for placing orders and much, much more. We do not make any specific recommendations in our service. We do the work for you and provide you with the knowledge, trading tips and the confidence in placing your orders.
The New World Order Plan is spiritually based: it is a conflict between God and His forces, on the one hand, and Satan and his demonic forces on the other side. Anyone who does not know Biblical doctrine about God and Satan, and who does not know Scriptural prophecy, cannot comprehend the nature of the struggle facing the world today. - David Bay, Cutting Edge Ministries
For we wrestle not against flesh and blood, but against principalities, against powers, against the rulers of the darkness of this world, against spiritual wickedness in high places. - Ephesians 6:12
For we are opposed around the world by a monolithic and ruthless conspiracy that relies on covert means for expanding its sphere of influence... Its preparations are concealed, not published. Its mistakes are buried, not headlined. Its dissenters are silenced, not praised. No expenditure is questioned, no rumor is printed, no secret is revealed. - President John F. Kennedy, April 27, 1961
The book in which they are embodied was first published in the year 1897 by Philip Stepanov for private circulation among his intimate friends. The first time Nilus published them was in 1901 in a book called The Great Within the Small and reprinted in 1905. A copy of this is in the British Museum bearing the date of its reception, August 10, 1906. All copies that were known to exist in Russia were destroyed in the Kerensky regime, and under his successors the possession of a copy by anyone in Soviet land was a crime sufficient to ensure the owner's of being shot on sight. The fact is in itself sufficient proof of the genuineness of the Protocols. The Jewish journals, of course, say that they are a forgery, leaving it to be understood that Professor Nilus, who embodied them in a work of his own, had concocted them for his own purposes.
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Introduction
The principal scientist behind Technocracy was M. King Hubbert, a young geoscientist who would later (in 1948-1956) invent the now-famous Peak Oil Theory, also known as the Hubbert Peak Theory. Hubbert stated that the discovery of new energy reserves and their production would be outstripped by usage, thereby eventually causing economic and social havoc. Many modern followers of Peak Oil Theory believe that the 2007-2009 global recession was exacerbated in part by record oil prices that reflected validity of the theory. 
Scott further wrote, 
