The global economy has been in a slow motion crash since 2008. The major banks of the world have conjured up such a massive debt burden that now the global financial systems are imploding, accelerating the speed of the global economic crash.
Every time the Federal Reserve, the central bank for the US, loans out money it is essentially creating more US dollars out of thin air. Every US dollar in existence represents a unit of debt that must be repaid. That's how our debt-based monetary system works.
Before 1933, every US dollar in existence represented a certain amount of physical gold or silver. Since 1933, when President Franklin Delano Roosevelt confiscated US citizens gold to revalue the US dollar, and then later in 1971, when President Richard Nixon took the dollar completely off the gold standard, the US dollar has been backed by nothing but the promise that the US Government
(i.e. the US taxpayer) would work to produce goods or services in exchange for that dollar.
Every US taxpayer has to work to pay off the debt that every US dollar in existence represents. Every time the Federal Reserve loans
(prints) money it is creating more debt that the US taxpayers have to work to pay off.
The Federal Reserve is not a US Government institution. It is a privately owned bank. The US taxpayers, who are also voters, have absolutely no control over the Federal Reserve or say in its actions but the Federal Reserve controls the fruits of every US taxpayers' labors
(and anyone elses' in the world who uses US dollars). The more US dollars
(debt) the Federal Reserve prints, the longer you have to work to pay off those newly, mass-created debt dollars.
For banks, other people's debt owed to the banks is an asset. Debt is the banks' wealth. Wealth equals power. The greater the wealth, the greater the power. Since debt is wealth for the banks, the more debt that exists the more power the banks have. The greater the debt, the greater the banks' power.
Power corrupts.
With the advent of computers, complex financial derivatives, high frequency trading and other hi-tech chicanery the banks were able to "book" profits
(other people's debt) faster and faster to the point where the most powerful banks could generate millions of debt dollars in a mere second. Blinded by near instant profits the banks forgot that it takes time for people to pay off their debts.
Banks have fallen into their own greedy trap and leveraged
(took on debt themselves) their wealth in pursuit of ever increasing profits and power. When the banks' own debts came due
(in massive amounts of high speed margin calls, credit default swaps and many other shady deals gone bad) the banks were unable to pay those debts because the banks' wealth, other people's debt, takes time to pay back. Even though the banks "booked" instant profits in the billions and trillions, their real wealth, the assets they actually had on hand and in reserve were all tied up in other people's debt - debt that takes time to pay off.
In real time, in the real world minutes-and-hours time, the banks are, technically and genuinely, insolvent. The major banks of the industrialized world are all broke because their profits, though claimed instantly on their books, are based on debt that will take an incalculable amount of years to pay off.
Because of the banks' insanely excessive and greedy leveraging and gambling, the derivatives liabilities
(the banks' gambling debts) are estimated in the quadrillions of debt dollars. There will never be enough people and lifetimes of labor on this earth to pay off that much debt.
The major banks of the world are broke and each and every of them know it.
Back in 2008, at the precipice of the global economic collapse, the banks refused to lend to one another. This was dubbed a "liquidity crisis". The big banks weren't lending to each other because they all "knew"
(it takes a shyster to know a shyster) that they were all broke.
This wasn't a liquidity crisis, it was an insolvency crisis. If it had been called what it really was, a global insolvency crisis, the major banks of the world would have to publicly admit they were broke. To admit they were broke would mean admitting the banks had no wealth. No wealth means no power and to the power mad oligarchy of the banks that was absolutely unthinkable.
To save the world's banking systems' face
(and power) the central banks of the world opened up lines of ridiculously cheap credit to the major banks. In effect, the central banks of the world, especially the Federal Reserve, were creating trillions of debt dollars out of thin air to preserve the power of the major banks. The massive amounts of debt dollars created by the Federal Reserve will steal the blood and sweat of tax payers for generations to come.
Oh, yes, it's stealing. Theft. Grand larceny on a global scale.
The more debt dollars that are created out of thin air, the less valuable the existing debt dollars become. The less valuable the debt dollars are the more of them it takes to buy stuff. The more debt dollars it takes to buy stuff the longer you have to work to accumulate those debt dollars.
Get it?
Going slightly off track here to better illustrate this last point I made...
Currently the national debt of the US is $15 trillion. There are about 7 billion people in the world as of late 2011. Divide the national debt of the US, $15 trillion, by the number of people living on this earth, 7 billion, and the result is $2,142 dollars of debt for every man, woman and child on this planet.
That's just the national debt of the US.
The combined derivative exposure of Bank of American and JP Morgan-Chase is estimated to be over $150 trillion. Those two American mega banks have a debt load ten times greater than the entire, super-power-nation-of-the-world, United States of America!
Just two freaking banks!!
A trillion is a thousand, billions. A quadrillion is a million, billions. The major banks of world have conjured up over a quadrillion of derivative debt dollars and burdened us with all of it.
Returning now to liquidity/insolvency crisis of 2008...
In the fall of 2008 the US Federal Government passed the T.A.R.P.
(Troubled Asset Relief Program) to bail out the major US banks and corporations to the tune of $700 billion
(then later nudged up to $800 billion).
The US taxpayers/voters were against this and the bill didn't pass the first time. Then the banks pressured their puppet politicians and, against the will of the people, the TARP, bankster bail-out, bill was passed.
US taxpayers were justifiably outraged. However, it turns out that the US taxpayers
(and the politicians) were being kept in the dark about much, much bigger bail-outs.
With last summer's passage of the Dodd-Frank Bank Reform and Consumer Protection bill, a small piece of legislation was attached to the end of the bill that granted a one-time-only audit of the Federal Reserve for the specific period of December 1, 2007 through July 21, 2010.
(Wikipediea - "Dodd–Frank Wall Street Reform and Consumer Protection Act" http://en.wikipedia.org/wiki/Dodd–Frank_Wall_Street_Reform_and_Consumer_Protection_Act)
After several months of going through thousands of scattered documents begrudgingly released by the Federal Reserve, very disturbing revelations are coming to light.
For years the Federal Reserve has been vehemently fighting inquiries by the US Congress and private institutions for an accounting of its actions. The small glimpse gained by the Dodd-Frank bill shows why the Federal Reserve is so amendment about it's secrets.
Unbeknownst to the US taxpayers and even the US politicians, the Federal Reserve, between December 2007 and July 2010, had doled out over $16 trillion, US taxpayer obligated dollars to the major banks of the US and the world.
On December 5, 2008, over $1.2 trillion dollars where handed out to the major banks by the Federal Reserve. $400 billion more than the US Federal Government had given the banks just a couple months earlier.
(Bloomberg - "Wall Street Aristocracy Got $1.2 Trillion in Secret Loans" http://www.bloomberg.com/news/2011-08-21/wall-street-aristocracy-got-1-2-trillion-in-fed-s-secret-loans.html)
By March 2009, the supposed lowest point of the Great Recession
(baloney, we are in a Greater Depression, folks), the Federal Reserve had given the banks almost $8 trillion. The $700 billion TARP that everyone was screaming over was merely chump change compared to what the Federal Reserve was secretly doling out.
(Bloomberg - "Secret Fed Loans Gave Banks $13 Billion Undisclosed to Congress" http://mobile.bloomberg.com/news/2011-11-28/secret-fed-loans-undisclosed-to-congress-gave-banks-13-billion-in-income.html)
The TARP funds doled out by the US Government at least had
some strings attached
(some, not much but some). The egregious amounts the Federal Reserved lavished on its friends had basically no strings attached to them.
Here's a few names you might recognize and how much they received from the Federal Reserve over a two year period.
Citigroup - $2.513 trillion
Morgan Stanley - $2.041 trillion
Merrill Lynch - $1.949 trillion
Bank of America - $1.344 trillion
Barclays PLC - $868 billion
Bear Sterns - $853 billion
Goldman Sachs - $814 billion
Royal Bank of Scotland - $541 billion
JP Morgan Chase - $391 billion
Deutsche Bank - $354 billion
UBS - $287 billion
Credit Suisse - $262 billion
Lehman Brothers - $183 billion
Bank of Scotland - $181 billion
BNP Paribas - $175 billion
Wells Fargo - $159 billion
Dexia - $159 billion
Wachovia - $142 billion
Dresdner Bank - $135 billion
Societe Generale - $124 billion
"All Other Borrowers" - $2.639 trillion
All that in just
two years. It's unknown how much they've received in the past and are currently receiving!
(GAO Federal Investigation Audit Report, document page 131/webpage 144, http://www.scribd.com/doc/60553686/GAO-Fed-Investigation#outer_page_144 - It's a 266 page report. If you have slow Internet you may want to get up and make a pot of coffee while you wait for the page to load.)
Free money for the banksters that caused a global economic collapse, no strings attached, mega bonuses and profits for the banksters while at the same time totally screwing over the US taxpayer.
Nice.
But, hey, that's all ancient history, way back in 2008 through 2010, right?
Last week bank liquidity seized up in the Eurozone
(the parts of Europe that use Euro as their currency).
On Wednesday of this week
(November 30, 2011), the Federal Reserve along with the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, and the Swiss National Bank, in coordinated efforts, provided open-ended credit to Eurozone banks.
In more specific terms, the US Federal Reserved gave out unlimited loans to the European Central Bank to bail-out the European banks.
The bulk of the European bank bail-out has been dumped on the US taxpayer, once again, for an unlimited amount of debt dollars for US taxpayer to pay for countless generations to come.
(Zero Hedge - "Here Comes The Global, US-Funded Liquidity Bail Out" http://www.zerohedge.com/news/here-comes-global-liquidity-bail-out)
The Federal Reserve bailed-out the major European banks because all the big banks are interconnected - European
and American big banks.
If any of the major European banks failed
(and it is suspected a major French bank was on the verge of going under Tuesday night) then all other major banks of the world, including the US mega-banks would be dragged under in a chain reaction if financial implosion.
Remember, wealth is power. The banks must maintain the illusion of wealth
(debt created out of thin air) to retain their global power. This isn't about home mortgages. This
is about global power.
Ok, another step-aside to illustrate my "banksters global power" point.
The mega bank Goldman Sachs has been called a "Vampire Squid" for good reason.
(Rolling Stone - "The Great American Bubble Machine" http://www.rollingstone.com/politics/news/the-great-american-bubble-machine-20100405) The mega bank has its tentacles embedded into many levels of financial and political power throughout the world.
For example, Greece's new prime minister, Lucas Papademos, ran the Central Bank of Greece when Goldman Sachs was doing some shady derivatives deals to hide Greece's debt in order to facilitate Greece's entry into the Eurozone. Greece's head of debt management, Petros Christodoufou, is a former Goldman Sachs employee.
The newly elected prime minister and financial minister of Italy, Mario Monti, is an international adviser to Goldman Sachs. Other former international advisers to Goldman Sachs who have held high positions of power and influence are Germany's Otmar Issing and Belgium's Karel Van Miert.
The new head honcho at the European Central Bank, Mario Draghi - former managing director of Goldman Sachs International. Some other Goldman Sachs International alumni: Antonio Borges was the former vice chairman of Goldman Sachs International before becoming the
(former) head of the IMF's European Department and Ireland's former Attorney General, Peter Sutherland is now a non-executive director of Goldman Sachs International.
Let's not forget the home team here in the good ol' US of A.
Former Secretaries of Treasury Robert Rubin and Hank Paulson
(of TARP infamy) and our current Secretary of Treasury
(and former head of the New York Federal Reserve), Timothy Geithner and Mr. Geithner's chief of staff, former Goldman Sachs lobbyist, Mark Patterson.
For more disgusting details on the history and far reaching influence of Goldman Sachs read this Wikipedia page on the vampire squid:
http://en.wikipedia.org/wiki/Goldman_Sachs
Oh, and as an additional side note, did any of you read about how our illustrious former Secretary of Treasury, Hank Paulson, leaked insider information to his Goldman Sachs bankster buddies about the bail-outs of Fannie Mae and Freddie Mac seven weeks in advance?
(Zero Hedge - "Hank Paulson Tipped Off The Goldman-Led "Plunge Protection Team" About Fannie Bankruptcy 7 Weeks In Advance" http://www.zerohedge.com/news/hank-paulson-tipped-goldman-led-plunge-protection-team-about-fannie-bankruptcy-7-weeks-advance)
Now returning to my frothing at the mouth rant about the Federal Reserve and debt dollars...
The banking crisis of 2008 is happening all over again and will happen again even sooner the next time until eventually no amount of debt dollar printing will stave off the total and complete collapse of the global financial system.
The fundamental problems were never fixed. All that these massive bail-outs have accomplished is to "kick the can down the road", to paper-over, cover-up, hide the un-payable debts the banks have conjured into being. Debts the rest of us are expected to pay off.
But there's nothing any of us can do about this, right?
You couldn't possibly learn about this stuff, talk about it, write about it, tell others about it or educate others about any of this.
Nah, you couldn't do that.
If more and more people knew about the stuff the banksters are doing to them then these people would still not be able to do anything about it.
It's not like people could get so fed up that they grabbed hold of their elected representatives by the short hairs and commanded those representatives to reinstate the Glass-Steagal Act which separated the gambling casino-like investment banks from the safe-haven-for-consumers commercial banks.
Nope. Can't do it.
People also can't possibly command their elected representatives to abolish the Federal Reserve and return the creation of US currency to the US Congress
(as it was intended to by the US Constitution). That would mean the people, the voters who have hold of the Congress critters by the short hairs, could have a say in matter; could actually
do something about how many debt dollars were created out of thin air.
What?
Voters having a say in their government? A government of the people, by the people, for the people?
That's patently ridiculous.
There's absolutely nothing voters can do about it. That's doctrine.
Why, such silly notions of doing something about it might lead to people voting to instate a different monetary system that wasn't debt based.
Barter?
Quaint, old-fashioned, time honored but quite impractical and difficult to tax into oblivion.
Tangible asset backed currency like the gold standard?
Hogwash. That would severely limit how much the politicians can overspend because gold can't printed out of thin air. And the politicians
will overspend because there is nothing you can do about it.
A different kind of monetary system? What utter nonsense!
There can be no other type of viable monetary system because the banks say so!
Just because the banks are broke and have collapsed the entire global economy doesn't mean they aren't experts in money.
Phht!
Alternative monetary systems are not allowed by the banks just as fuel efficiency technology is not allowed by oil and automotive companies. Remember, it's all about retaining profits and power.
(Global Economic Intersection - "Solve Debt Problems with Non-Debt Money" http://econintersect.com/b2evolution/blog2.php/2011/08/09/solve-debt-problems-with-non-debt-money)
Another thing that voting people couldn't possibly do is yank our Congress critters short hairs hard enough to use existing anti-trust and anti-monopoly laws to break up the "too big to fail" banks and corporations.
No, you can't do any of this because you couldn't possibly find out who your elected representatives are. Online resources like USA.gov's "Contact Elected Officials"
http://www.usa.gov/Contact/Elected.shtml don't exist because there is nothing you can do about it.
And even if you did know who your elected officials were, you wouldn't know how to properly communicate with them
(grabbing them by the short hairs is just a metaphor - sorry) because that kind of information doesn't exist here
http://usgovinfo.about.com/od/uscongress/a/letterscongress.htm either.
Even if you did contact your elected representatives they would never listen to you. Your just one person.
If you helped to educate ten of your friends and relatives and they did the same for ten of their own or maybe a bunch of voting constituents just got hopping mad and demanded their elected representative do something, their elected representative still wouldn't notice because there is nothing these voters can do about it.
Nothing at all.
Not at the federal level, not at the state level and certainly nothing at the local level. Voting constituents leveraging political pressure from the local and state levels against their representative at the federal level will do absolutely no good because there is nothing voters can do about it.
C'mon, don't be silly. The banks have successfully trained you to drop your pants, bend over, spread your butt-cheeks wide open and obediently and willing take whatever they shove up your backside.
You know darn well that there is nothing you can do about it so just learn to accept it.
Now drop your pants and bend over!
If this literary image offends you, I apologize. I'm trying to drive home a very significant point.
If you are not offended, by any of this, then I am saddened.
The reason things have come to this is because we've allowed it to. We have been told, over and over so many times that we've come to believe it, that there is nothing we can do. To just accept things as they are.
We can do something about what's happening. If not for ourselves then for our friends and loved ones.
You don't have to commit acts of valor and great heroism. You just have to communicate with people about these things.
Don't just talk about football and Lady Gaga but also talk about the things that are robbing your children of any chance of prosperity. Brag about your grandchildren and how many times you've written your house representative. While your boasting and kvetching about your gall bladder surgery also one-up your fellow suffers with how many times you've complained to your senator.
If you are a real nut-job, get involved with a political movement. Occupy Wall Street, the Tea Party, the Beer Party
(yup, there's one of those http://officialbeerparty.com/wp/about/) or the I-Love-Chocolate-Sundaes Party
(Ok, I made that one up).
The Occupy Wall Street movement is right. Wall Street, big corporations and the financial sector in general have thoroughly screwed America and other countries around the world.
The Tea Party movement is right. Big government is too oppressive and too invasive. The federal government should be very limited. The individual states should have more political power, customized to their unique needs and situations, as it was intended by the US Constitution.
Occupy Wall Street movement is against big corporations.
The Tea Party movement is against big government.
If the grassroots people of both Occupy Wall Street and the Tea Party movements ever realized that big corporations and big government are one and the same here in the US then a righteous reckoning would come against the banksters and their puppet politicians.
Oh, mentioning Occupy Wall Street and the Tea Party just made me think of another supplemental tangent to this rant.
Stepping aside again for a moment...
If you talk to folks inclined to the Occupy Wall Street movement you'll probably hear the word "fascism" tossed about. For those of the Tea Party bent, "socialism" is the epithet of choice or "communism" if they are a really old farts.
Me, I'm kind of leaning more towards "corporatism" and "kleptocracy" at this point of my study of this mess we are going through. At least from the "step back and look at the bigger picture" point of view. Delve into the finer details and you can find all kinds of "-isms".
If you would like to read some opinions on corporatism and kleptocracy here are two web articles for your pleasure:
Huffington Post - "American Kleptocracy: How Fears of Socialism and Fascism Hide Naked Theft" http://www.huffingtonpost.com/william-j-astore/american-kleptocracy-how_b_547708.html
and...
The American Dream - "Corporatism Is Not Capitalism: 7 Things About The Monolithic Predator Corporations That Dominate Our Economy That Every American Should Know" http://endoftheamericandream.com/archives/corporatism-is-not-capitalism-7-things-about-the-monolithic-predator-corporations-that-dominate-our-economy-that-every-american-should-know
Alright, back to what we can do about this festering mess...
Many are looking towards the 2012 US Presidential election for the cure-all for what ails America.
Folks, no one person, not even the President of the United States is going to be able to set things back on the right track.
Here's a little heads up. Mitt Romney will be the Republican candidate for President. Not because of any of his policies or stances on any thing but because Wall Street has given him more money than any of the other Republican candidates combined.
(The American Dream - "The Big Wall Street Banks Are Already Trying To Buy The 2012 Election" http://endoftheamericandream.com/archives/the-big-wall-street-banks-are-already-trying-to-buy-the-2012-election)
Wall Street has already bought the 2012 US Presidential election and the world is going to pay for it.
Whatever your political bent, set your target sites on Congress.
Where do most of the presidential candidates come from?
Congress.
Who can impeach a sitting US President?
Congress.
Who approves the appointment of Supreme Court Judges and can impeach those same judges?
(Wikipedia - "Supreme Court of the United States" http://en.wikipedia.org/wiki/Supreme_Court_of_the_United_States)
Congress
(the Senate approves the judges).
Who authorizes national spending?
Congress.
Who writes the tax code, trade policies, and business laws that either benefit, regulate or abolish banking and corporate practices?
Congress.
Who is the Congress directly responsible too?
Us, the American voters.
It is through Congress that we can force the much needed changes and
enforce existing laws against the unrepentant, criminal banksters that have destroyed this country and other nations around the world.
Unfortunately it's too late to stop the economic, financial, political and social devastation that is coming.
In the very near future we will have to make decisions that will result in very difficult consequences for generations to come. The damage is already done. There is no quick, easy or painless way to fix things.
The more we know, the better we understand, of what has happened, what is happening and what will happen, the better our decisions will be when the time comes.
I've laid out, in a very general scope, just some of the major problems we face. Some of you may already heard these problems repeatedly from your own news sources, family or friends. Many people are starting to talk about out the problems but few have any workable solutions.
I don't have any concrete solutions either but I do know how to start working on them and above I've laid that process out for you. Learn. Educate others by talking to them about what you have learned. Work the politicians, leveraging them from the local level, through the state level and on up to the federal level.
The global economy is crashing, the global financial system is imploding, due in large part by the insane and reckless machinations of big banks across the globe.
This is going to be one for the history books folks.
Stop believing that we have to drop our pants and bend over because there is nothing we can do about it.
There is a lot that we can do about it... and keep our pants up.
No, I don't care if letting you underwear show is the style, pull your pants up!
Comments
Please, keep your comments clean, civil and relevant. Cussing with foul language just for the sake of using foul language only proves the person to be an obnoxious, dull-witted fool.
