Less Sovereignty is the Central Bankers Solution for the Crisis

By LUIS MIRANDA | THE REAL AGENDA | JUNE 29, 2012

Everyone on the main stream seems to believe that the continuous meetings between European central bankers and government officials are seeking to save the Euro and to help the governments deal with their sovereign debts. It is common to hear on television how journalists and so-called analysts explain that their expectations include the proposal of real solutions to the crisis which immediately produce jobs and bring stability to the markets.

They just don’t get it. These meetings between central bankers and European leaders are nothing about stability, a solution to the debt problem or the creation of jobs around the euro zone. The latest agreement between the EU Council and the Prime Ministers of Italy and Spain is an example of how the bankers are in complete control. Although the media has painted the bailout of the Spanish and Italian banks as a triumph for both governments, which according to the reports “had their way” when negotiating with the bankers, the reality is they are simply following orders. It wasn’t the Spanish and Italian governments the ones who imposed the conditions that will rule the bailout, but the banks.

The rescue of the banking system in those countries is indeed a result of Italy and Spain submitting, accepting and supporting the idea that the European Central Bank will officially turn into the manager of all Euro economies. Only after Mariano Rajoy and Mario Monti accepted that condition, was that the central bankers gave the green light to ‘lend the money’ to the Spanish and Italian banks, not the other way around. The main stream media is portraying an outcome that is completely the opposite to reality by saying that Mr. Rajoy and Mr. Monti twisted German Chancellor Angela Merkel’s arm into accepting their conditions. The truth is that Merkel herself had to accept the centralization of economic planning sought by the banks as a condition not to let the EU zone collapse before the expected time, and with it drag every single nation including Germany into the rabbit hole they are all going towards in a controlled fashion.

Less sovereignty in exchange for solidarity; this is the latest talking point that emerged from European leaders to justify the loss of self-rule and the intervention of European bankers in the decision making process at the national level. Governments have publicly adopted what seems to be a socialist standing to try to sell their fiscal irresponsibility and to deviate attention from the acquisition of European nations by the central bankers who are the origin of the current financial crisis. But it is not socialism you see, it’s fascism. Countries must get more debt and surrender their sovereignty in order to solve a crisis that is not supposed to get solved, but that was created and planned to further centralize power in the hands of the bankers themselves.

Everyone who is well-informed is familiar with the World Bank and IMF’s plans to cause the current crisis, — and all the other ones that came before — how they’ve applied the same neo-feudal model throughout history to destroy economies and artificially recreate them using models for growth based on the acquisition of debt and the never-ending payments of interests on that debt. It needs to be said: This crisis is not accidental or unexpected. It was planned and executed for decades to seek a justification for a central government just as it has been promoted by the bankers and the media for the past 12 months. The result of the current negotiations in not to seek an exit to the debt problem or to encourage economic growth, but to hand even more power to the bankers.

The meeting held today where European Prime Ministers pose as the saviors is nothing else than window dressing. There is no solidarity on a proposal that intends to make nations less independent and more enslaved to the central bankers. The result that will came from the meeting held by Mariano Rajoy, Angela Merkel Mario Monti and François Hollande is further consolidation of financial power; nothing else. As explained by Joseph Stiglitz, the World Bank and the IMF pursue a policy of financial enslavement against every country by following four simple steps.

Privatization, which is more like ‘Briberization’, he told Greg Palast. Under this scheme, economies are collapsed from the inside while consolidating national assets for pennies on the dollar. Briberization yields then to the second step,  a one-size-fits-all rescue-your-economy plan, which in theory intends to rescue a country’s economy by using  capital market liberalization. This, again in theory, would allow the free flow of investment in and out of the country, but in reality it is the process through which the bankers complete the theft of resources and send them out every time a country buys into the “rescue your economy’ non-sense. As explained by Palast in his article The Globalizer who came in from the Cold, foreign monies come in to the countries for speculative acquisitions in various sectors of the economy and then leaves just as suddenly as it came. The result is the literal disappearance of a nation’s reserves in a matter of days. In order to get back some of those monies, entities like the IMF and the World Bank immediately demand that the country raise interest rates to anywhere between 30% and 80%.

Next, on step three, the bankers mandate that the government impose steep increases in the prices of basic needs such as food, water and gas. In the mid-term, the unexpected increases cause what Stiglitz calls the “The IMF riot.” During this time the bankers “turn up the heat until, finally, the whole cauldron blows up,” said Stiglitz. The bankers simply cut any and all subsidies to food and fuel for the poorest people as it happened in Argentina at the turn of the century and in Indonesia in 1998. Other examples of these riots were the ones in Bolivian riots over water prices last year and this February, the riots in Ecuador over the rise in cooking gas prices imposed by the World Bank.

Secret documents were also obtained by the BBC and The Observer which showed that the banks wanted to make the US dollar the official currency of Ecuador and by doing that, they would submit more than half of the population there under the poverty line. This is something similar to what was done in Argentina and what is being tried now in Europe. According to Stiglitz, although millions of people end up as losers under this system, there are indeed a handful of winners: The Banks. The western banks and the US Treasury make gigantic amounts of cash by infliction pain over developing nations. He cited the case of Ethiopia, where the World Bank and IMF ordered the government to ‘invest’ money on the Federal Reserve’s Treasuries which pays only 4 percent interest, while the country had to borrow money at 12 percent. Ethiopia was looted by the banks.

On step four of the bankers propose and impose the so-called Free Trade, as they did through NAFTA, CAFTA and other trade agreements. They call these programs “poverty reduction strategies”. However, all they do is open markets for a one way flow of products from powerful nations like the United States and China to the poor countries, while closing their own markets to foreign products. The almost automatic consequence of this free trade agreements is the destruction of the local production and farming since they cannot compete with the ridiculous low prices offered by corporations that have their products manufactured by slave labor in Asia and Africa.

As Greg Palast puts it, let there be no confusion about the role of the IMF, World Bank and World Trade Organization in the destruction of nation-states, private property and sovereignty, because they are just three masks that hide the faces of the monopoly men who seek to impose a centralized government model based on absolutist conditions.The results of the negotiations to supposedly save the euro zone are not such, they are just another step into the creeping arrival of world tyranny being sold as the only possible solution to deliver all of us from the consequences of “unbalanced economies”. The plans for the creation and implosion of economies were drafted long ago and the result of those practices is one and only one: World Government. This outcome, by the way, is not a solution or the solution to the current economic crisis.

When you have leaches sucking you dry, the only possible solution is to remove the leaches. The bleeding is the collapsing economy, the leaches are the central bankers, the solution is to remove them from our bodies. Nothing else has worked, nothing else will work.

“We are absolutely slaves to Central Banks”

By LUIS MIRANDA | THE REAL AGENDA | JUNE 25, 2012

It hasn’t been a secret for long, but very few times do viewers watch or listen to guests on main stream media not only accepting the fact that we are all slaves who work for central bankers, but to admit it emphatically on US national television. In a recent interview on CNBC’s Kudlow Report, one of the co-hosts asked on air if the current economic and financial situation was simply global governance at last, and whether the central bankers were in charge. Aren’t we all living and dying for what the central bankers do?  One of the guests, Jim Iuorio, said that such scenario was exactly what we are experiencing. “To answer your question, we are absolutely slaves to Central Banks,” Iuorio said.

See the complete clip below:

There is not need for the main stream media to admit or show proof of such scenario. Perhaps the clearest example that shows how the central bankers are in total control, is that they ordered governments in North America and Europe to ‘rescue’ the banks that were near bankruptcy due to their holdings of toxic financial products. Even banks that did not need to be rescued were obligated to accept financial aid in a move to chain down almost every single banking institution to the European and American central bankers.

Last week, The Real Agenda informed about the current state of monetary policy planning in the euro zone where central bankers are already working on further consolidation of the global financial system. In the article New Global Money Secretly Planned by Elites, AmericanFreed.com explains how the world’s monetary system is being shaped right now.As explained in previous articles, central bankers are adepts of creating order out of chaos, and the current global crisis is not the exception. The elites in charge of the banking system are anticipating the results of their monetary and financial policies of the last century, and have already introduced plans for a world currency. Such currency seems to be a basket of currencies backed by gold, which will later become a single currency.

All financial experts agree that the establishment of a single currency will not occur at once, but over the next 5 to 15 years, depending on how the central bankers plans of financial consolidation advance in the Euro zone and North America. The elites are counting on their current rescues to buy them time until their system is fully in place to handle the last great collapse, when they will introduce the one currency system as the only solution to the chaos they caused. The elites or central bankers who want to run the world will produce as much  agony as possible in order to tighten the grip as strongly as they can before the big implosion.

The central bankers have been successful in inducing countries into massive debt as a way to get out of the current state of indebtedness; an oxymoron, no doubt. Spain, a country on the verge of falling off the financial precipice, announced today its request to the Euro government in Brussels to rescue its banking system. The Spanish government continues to deny that its call for a rescue is indeed a bailout, however the more than $100 billion that will be given to some of the biggest banks in that country, is coming from the European financial rescue fund created under the auspices of the government led by Angela Merkel.

Spain in now working on a memo of understanding which the government in Brussels will officially receive next July 9. The move to accept monies from the European fund will be discussed next Thursday and Friday during a meeting that will be held by some European leaders. The conditions under which the rescue of Spanish banks will occur, will include length of the loan, interest rate, payment conditions and penalties that will be incurred should the bankers not pay their debt back. This last fact is strange, yet it is another example of how central bankers control every government.

European leaders say banks cannot request a financial rescue themselves, that the countries need to solicit such bailouts, even though the banks are branches of the central banking model all over Europe. At the same time, the bankers in control of the euro zone also say that governments must request the money and detail the conditions under which their banks will receive the funds because they are legally prohibited from doing so. Of course, that is not the case. It is the European central bankers the ones who dictate the conditions, who determine the interest rate European taxpayers — not the banks — will have to pay for the next 25 years or so. Indeed, governments request the bailout of their banks, but the banks are not the ones who will pay the interests on the debt or the debt itself. That burden is purposely left to the European working class.

An even more insightful view of how central bankers control the global financial system came from another guest of Kudlow’s Report, Jim LaCamp. “Markets are driven by policy, they dare not driven by market forces, they are driven by central banks’ proclamations.” In other words, it is the decisions made by technocrats in charge of unelected supranational financial institutions who operate on behalf of the central bankers, and who attend to their requests, the ones who determine how economies function. It is not industrial production, free markets, elected government directives or the proposals put in front of these governments by social groups.

“In Spain, too many people say to many things about what needs to be done,” said Iñigo Méndez de Vigo, Spain’s Secretary of State for European Relations. See, only the bankers should dictate what is done, not the people, not the press, not the governments. According to Méndez, Brussels needs to oversee Spain’s and other nations’ budgets, economies and monetary policies. “We have to make decisions on an European level, right now,” added Méndez during an interview on TVE, Spain’s government funded television. “We have to assure the euro zone that here in Spain were are serious about finding a solution to this debt  problem.”

“It is important not to lose sight of the intentions of this request for funds,” said Spanish Prime Minister, Mariano Rajoy, who insists that the bailout of the Spanish banking system is not a bailout. He sees it positive that the rescue will only apply to 3 banks, but he forgets to point out that the sum of money — $100 billion — is what makes the rescue alarming, not the number of banks that are being rescued. Under the current model chosen by the central banks, the adoption of debt-based programs to solve a collapse caused by sovereign debt, the scenario seen in Greece and Spain will be repeated in France, Portugal and the rest of Europe before moving to North America, where the financial implosion will take place.

Who else will admit that the people of the world are indeed slaves to the global financial system controlled by central banks?

European Debt Crisis Continues to Bleed

The blame game begins as no solution is achieved for Greece, Italy or Spain.

By JAMES CHAPMAN | MAIL ONLINE | MAY 16, 2012

David Cameron will today express grave doubts about the survival of the euro amid fears that a collapse could drag Britain into a decade-long depression.

He will warn of ‘perilous economic times’ and launch a startling attack on the failure of Germany and other major European countries to take the necessary steps if they want to prevent the euro breaking apart.

‘The eurozone is at a crossroads – it either has to make up, or it is looking at a potential break-up,’ the Prime Minister will say, insisting that sticking to the Government’s austerity measures is the only way to ‘keep Britain safe’.

With signs of a full-blown bank run beginning in debt-stricken Greece, experts warned that if the crisis is not quickly contained, as much as 10 per cent of national income could be wiped out in countries across the EU.

Bank of England governor Sir Mervyn King said yesterday the single-currency bloc was ‘tearing itself apart without any obvious solution’, while former Labour Chancellor Alistair Darling said the crisis could condemn Britain to ‘years of stagnation’. In other developments:

■ Households face another painful squeeze this year after the Bank of England raised its inflation forecast and warned of rising mortgage costs;

■ Growth forecasts for this year were slashed from 1.3 per cent to 0.8 per cent, with no return to pre-financial crisis levels of growth before 2014;

■ Financial markets slumped further as Greek leaders braced themselves for  fresh elections after talks to form a coalition government failed;

■ In a glimmer of good news, unemployment dropped 45,000 to 2.63million, while the number in work jumped by 105,000 to 29.2million.

Economists believe the euro breaking up in disarray would herald a ten-year slump similar to that experienced by Japan in the 1990s. Japanese policymakers hesitated before tackling a banking crisis, and then struggled to revive economic growth, leading to a so-called ‘lost decade’.

As Society Breaks Down, People Beg for Tyranny

by Luis R. Miranda
The Real Agenda
August 11, 2011

It’s been at least 15 years since I heard calls for people to wake up because the greatest crisis in humanity’s existence was rapidly approaching. Today, as I watch video and photos from London, and previously from Syria, Egypt, the United States and Lybia, I cannot help but think that those who sought to warn us were simply and plainly correct. Perhaps the most surprising fact is that those truth tellers, who were often identified as conspiracy theorists, told us how it would happen and as the break point got closer and closer, they were even able to predict different aspects of the fall with outstanding precision.

Who would have believed 15 years ago that the world would crumble to its knees and would beg for the implementation of tyrannical policies and regimes in order to bring back law and order? I certainly didn’t. Before I began studying history and current events, I thought society would be able to take care of itself and avoid disaster. But the latest video feeds from London and everywhere else clearly show that society is lost in the foggy alternative reality they were born into 50 or more years ago. The social engineers played their hand well and now have most of the population consuming itself in a web of self-degradation, death and perversion fed to us as the sexiest fad for almost half a century.

In England, polls show that upwards of 65 percent of people are now calling for the use of rubber bullets, water canyons, police abuse and other tyrannical practices because they are too afraid to organize with their neighbors and take care of the looters that are destroying decades-old family businesses, homes, cars, shoe and clothing stores and other property to get their hands on the latest electronics, jewelry and various valuable products by breaking windows, smashing store front doors and pulling citizens from the their cars to smash their heads on the streets. Instead, British people are now calling for a government sponsored Police State.

Notice that most of the places that are being affected by riots and unrest are sections of the society whose members are unarmed and who cannot defend themselves because their government, which cannot protect them 24/7, implemented regulations to ban the people’s right to be armed and to defend their properties and their families. London shows signs of the most recent confrontation between members of the government-dependent underclass and the hard-working middle class, just as the social engineers planned it. As governments cut spending in a failed attempt to fix deficits and reduce their debt, it is exactly the underclass that feels the pinch first. But instead of attacking government policies and the entities responsible for the financial collapse, this uneducated underclass takes it upon themselves to beat the daylights out of middle class folks who suffer from the bank-sponsored self-inflicted financial crisis.

The financial and political apartheid taking place in the world -where governments steal the people’s pension funds to invest them in fictitious financial products, banks get bailed-out as they charge interest rates and / or fees for people to keep money in their accounts, the government cuts social security and medical care spending, people’s paychecks and pension buy less food- will continue to increase social volatility not only in London or Greece, but in the Americas, Asia, Africa and everywhere else. The Social Experiment failed horribly. But then again, it was meant to fail. The divisions meant to occur in order to monopolize, control and conquer arrived right on time.

The underclass as well as the dumbed down middle-class that for centuries sucked off the system through government established dependence programs only woke up after finding themselves with no jobs, no pension, no savings and no future. They woke up from their eternal state of slavery because the bribery scheme known as welfare that the government used to hook them up is suddenly crashing down, and they have not safety net to fall onto. What do I mean by bribery scheme? In 2007, the richest country in the planet had at least 52.6 percent of the people receiving government aid of some sort: pensions, social security and so on.. One in five Americans held a government job or a job that depended on government spending. Around 19 million used food stamps and 2 million got subsidized housing. If that is not government bribery, I don’t know what is it. The social engineers made sure from the start that only two classes existed: the productive class and the parasitical class. Both the government and the dependent classes are equally violent towards those who produce and who support them throughout their lives.

But perhaps one of the most abhorrent aspects of the current societal collapse is that the social engineers point to the underclass and the working class as those responsible for the crisis. That’s right. They accuse the so-called “useless eaters” for their greed and for living beyond their means and hold them responsible for the crisis we now experience. Both the underclass and a large part of the middle class are in part responsible for their greed and decadence. But weren’t they born and bathed into a system that promoted and facilitated their greed, decadence and dependence? Of course they were. Should the underclass and the middle class then be held responsible for the now developing crisis because they were greedy and dependent? Of course not. But that is what the bankers, the social engineers want the dumbed down majority to think, and that is why tonight racial divides grow bigger in London, the United States, Africa and Asia. The underclass believes that the middle class are the ones responsible for the crisis because they are successful business owners and were able to take care of themselves and their families. In the meantime, the bankers who are responsible for both classes’ misery run rampant ripping people off around the world.

The people are to blame, say the bankers, because they want more services but don’t want to pay more taxes. Due to the fact millions have not bought the propaganda, the government is now playing the collectivist card. “There is no need to look for anyone to blame because we must now come together to solve our problems”. Neither the government nor the banks want the taxpayers to fully understand that these two entities are solely responsible for the current state of affairs. Governments have bribed citizens openly for at least a century in order to control them, therefore it is insane to believe that someone will buy the government and bank sponsored propaganda.

While millions of people lose their jobs, homes and lives because they cannot afford them, a few decadent scum bags consume themselves in fake tribalism, racism, theft and violence while the cowardly ones wait for the state to do something and beg for Martial Law and a Police State. Those who accepted the American-created culture of death, sex, thuggery, drug use, suicide and gang oriented behaviours are now acting as what they always dreamed to be: a bunch of disaffected slaves with no jobs or future that look up at rappers, singers, sports figures, electronics, alcohol and drugs to fulfill their empty lives. The world went from praising explorers, scientists, fire fighters, inventors and community leaders to worship ‘bling’ and Madison Avenue-created delusion.

Those who took advantage of a corrupt debt-based system to get their holiday vacation, car and house loans were shocked after the banks that own their livelihoods cut off lines of credit three years ago to put an end to the fantasy reality they were accustomed to for so many years. Those who foolishly believed that paying into the public pension system would guarantee them some devalued change to live the rest of their lives, even though many had warned of its non-existence, were not only fools, but also irreparable willful ignorants. They trusted their government so much to give them everything, that no room was left to think that the same State could one day decided to take it all away; which is what is happening now. So now, the most dependent members of society are blaming other citizens and not the banks and the governments for their misery. Why? Because blame is the base of Statism and the State has shown people well to accept the blame game when it favours the State. They are now begging the social engineers to put an end to their misery. Events like the riots in London and the United States are just the beginning of what is turning out to be a long summer and a coming long winter. Street violence, crime and government opposition will be used by the controllers to take away more of our rights. Government will use armies and violence against peaceful protesters before bringing out austerity and a more visible Police State, to crush people’s right to speak and arm to themselves, track social media, email accounts, and any other sign of dissent.

Now, this is what a broken down society looks like in the developed world. Can you imagine what will it look like in socialist or inherently paternalistic poor countries when austerity, hunger and deep misery gets there?

Reaping What Bretton Woods Has Sown

The International Forecaster
April 2, 2011

The seeds of today’s monetary problems were laid at Bretton Woods, NH in 1944, as a combination of socialists, communists and fascists laid the groundwork for the IMF, the World Bank and the eventual elimination of gold from the monetary world. The Federal Reserve’s role was to bring that about from behind the scenes.

In the intervening years in order to move toward those goals the banking system run by the privately run Federal Reserve, allowed banks, some of which were run by the owners of the Fed, such as JPMorgan Chase, Goldman Sachs and Citigroup, were allowed to run rough shod over the system, always knowing they would be bailed out by the public. These banks have had and continue to have a license to steal under the illegal Federal Reserve Act. Over and over again these banks, Wall Street, insurance companies and transnational corporations have been bailed out of their speculations under the aegis of too big to fail. The excuse has always been that it must be done to protect the public. These entities got to keep the gains and the public got to share in the losses. The public and 95% of those working on Wall Street and banking didn’t have a clue to what was really going on. The Fed and other major central banks were not only playing this Fed game domestically, but internationally as well. Over those years the Fed had been designated the lender of last resort. We saw them in action over the last 3-1/2 years during what was termed the credit crisis. The Fed’s job was to bail out not only the US banking system rent asunder by bank speculation in the mortgage market, but to also bail out the buyers of such mortgages, known as MBS and CDOs, sold to British and European banks and other financial entities, which had purchased 60% of the toxic waste. If you notice not one of these lenders or buyers ever filed a civil or criminal suit against these purveyors of what has become to be known as toxic waste. We can only speculate, but we believe the dumping ground for this mortgage garbage was preset and that some of the buyers if not all were guaranteed by the Fed that if problems arose they would be bailed out and one way or another made whole. The Fed attempted to hide what they were doing and a lawsuit has finally forced them to divulge, who received funds created by the Fed, some $13.8 trillion, why and what collateral was accepted for such loans and have such loans been repaid. Another program called TARP was set up by the Treasury to bail out Wall Street, banking and transnational conglomerates all involved in this tight little circle of anointed corporations. This bailout program was accomplished by Treasury Secretary Paulson. He told Congress if the funds were not forthcoming for the insiders to bail themselves out via speculation based on inside information, then he would see to it that the financial system was brought down and destroyed. The high-handed ruse or extortion worked and these miscreants received their funds from the public Treasury, as well as from the Fed.

Gold backing for the US dollar was part of the result of the conference at the Mount Washington Hotel in Bretton Woods in that July of 1944. We have to interject here that in 1946 or 1947 I climbed Mt. Washington and once I reached the hotel it started snowing. Yes, snowing in August. The group of us from the camp quickly raced back down through the forest to better climes, which the snow failed to reach. Thus, 2 or 3 years after that historic meeting, I briefly visited that hotel, of course, not knowing what had taken place there.

 

George Soros, one of the world's strongest pushers for Global Financial and Economic consolidation.

This UN Monetary and Financial Conference, which included the International Bank for Reconstruction & Development, which became the World Bank, which was to make loans to the rubble that was to be Europe in 1945, and to which those economies, promote monetary cooperation and fix exchange rates, and eventually to eliminate the use of gold, as the backing and basis for international currency exchange, replacing gold with a fiat paper standard controlled by the Federal Reserve. The discipline of gold was to eventually be phased out of the system, so that the fed could create money out of thin air. This would be a perpetual tax on Americans as their currency dropped in value versus gold over the years. Currencies would no longer be exchanged in terms of their gold value. This was called a gold exchange standard. The public could not exchange US notes or Federal Reserve notes for gold, but nations could. The value of currencies versus one another, all of which were backed by gold was set by supply and demand. If a nation created too much currency the value of their currency would fall versus gold and other currencies. This method of monetary policy had previously been set into law by the passage of the Federal Reserve Act. The concept was to eventually have a world bank that would create a fiat currency for all nations that would supersede all other currencies. That, of course, is still underway today as elitists strive for a one-world currency and a new-world order. These concepts were promulgated and put in place by well-known Fabian socialist John Maynard Keynes, who as we reflect back was the author of an economic system that was corporatists fascist and the then Treasury Secretary, Harry Dexter White, who was a communist. It took 27 years, and on August 15, 1971, President Richard Nixon removed the US dollar from the gold exchange standard. That is how the fiat dollar was generally planned and that is why we have non-gold Federal Reserve notes today, instead of a gold backed currency.

 

The elitists’ corporatist fascist model is not working very well. The Fed, the Bank of England and Western banks have serious problems and throwing money at the problems is not working. Of course, do they want the solution to work? This depression they have deliberately created is not working the way they envisioned it would. In fact they are having trouble keeping it under control. We have just seen what is called a “black Swan” event. An earthquake, an untoward event, which ostensibly came from out of the blue. We’ll surmise that until we have empirical evidence that man did not create it. These are the kind of unplanned events that throw the elitist plans off kilter. It throws the direction of neo-liberal capitalism in several different directions. This is the system so prevalent in Europe, where profits are privatized and losses are socialized and become a debt that has to be paid by the people. This system, which we now have in America, keeps Wall Street and banking in power. This is accomplished by bailouts when the anointed corporations get themselves in trouble as we see in America today and in Europe as well. The state in our case by the privately owned Federal Reserve losses are monetized and appear in part in the form of higher inflation. It also comes in the form of public debt that has to be repaid by the taxpayer. Eventually the debt consumes the host.

As a result it is only a matter of time before the system unravels. The fractional banking system does not work and never has worked. The players who run the system know that. History is replete with instances of failure, which are well known to elitists. The collapse of the Lombard System in 1348, the year of the plague, and the collapse of the Hanseatic League in the early 1600s, are but two of scores of failures, most of which were deliberately planned. Fractional banking for those of you who do not know what it is, takes place when a lender lends more money than he can collateralize. The rule of thumb over the centuries has been to lend no more than eight times assets. Today that number is 40 times as assets. That is why most major western banks are broke. Any major untoward event could presently collapse the current system. In addition, some 10% of the basic assets of these banks are worthless. These banks are still in serious trouble in spite of receiving trillions of dollars in bailout funds of one kind or another. What happens when interest rates rise, which they must? The banks will be in trouble, as inflation rages. If that wasn’t bad enough contagion could also affect the banking system. That is when one bank borrows from another and then cannot get their funds back. That happened 3-1/2 years ago and the Fed stepped in and secretly guaranteed deposits. In this process of saving Wall Street and banking the public is put at enormous risk, which is a pattern used over and over again over the centuries.

These events naturally lead us to the dollar, which for months has had little sustainable strength either fundamental or technical. The run to 89 on the USDX ended in failure, and the recent strength at and near 75 was tepid at best. The recent intervention by the G-7 to weaken the yen, which has moved from 76 to 83, was really a backhanded attempt to stage a dollar rally, especially when you consider the absorption of Japanese Treasury sales, which is really what the exercise was all about. Needless to say, the NYC elitists needed the Japanese problem like they needed a hole in the head. The baggage the US dollar has is overwhelming. The government is being 70% to 80% financed by the Fed, which creates money and credit out of thin air. The federal deficit for the fiscal year will be $1.7 trillion. The US has two occupations and two ongoing wars costing billions of dollars a month. Municipalities and states are in dire financial straights and the economy would collapse without quantitative easing and stimulus. A rather sad state of affairs. Incidentally, we called the recent bottom on the dollar, but more importantly, we called the top at 89. Dollar and Treasury bond weakness will be exacerbated by the Middle East and North African revolutions and the ultimate result will be the demise of the petro dollar, which has always been the underlying strength to the dollar. The US, UK and France guaranteed safety for the oil producers, they denominated oil in US dollars, and they deposited their profits in NYC, London and Paris for management. The policy may well be at an end. If so that will be the end of regional purchases of US T-bonds. Thus, the loss of Chinese, Japanese and Gulf purchases will cancel out 70% of US Treasury purchases. These events could very well lead to the collapse of the Treasury bond market essentially leaving only the Fed as a buyer. As we predicted months ago the second half of 2011 will bring an implosion of US Federal debt, municipal and state debt, British debt and a collapse in EU debt and the beginning of the end for the euro. Along with 14% inflation gold and silver will rocket upwards.

The latest insult to American consciousness is a proposed cut in the budget deficit of $33 billion. That isn’t even cosmetic. In a budget with a $1.7 trillion deficit that isn’t even chump change. Can you imagine what the rest of the world is thinking? Try to sell treasuries under those conditions? The House is totally out of touch with reality. It takes its orders from Wall Street and banking. That has never been more obvious.

Hundreds of municipalities will fail in 2011 as well as some states. Austerity will continue for the average American citizen. That means GDP will fall from 70% by consumers to 68.5% with more bad news to come next year. All of these events have already, as displayed recently, begun to end the safe-haven status of the US dollar. Not only will the dollar be under pressure, but also so will the sale of Treasuries. It is possible the dollar could go to 65 on the USDX and the Treasury market could collapse. The plight of the dollar has not gone unnoticed. In 2001, the dollar’s share of official global foreign-reserves was 71.5%. At the end of 2010 it was 61.3%. Those moves do not instill confidence in the dollar.

We have contended for a year that a major meeting will be held with all countries attending to revalue and devalue currencies each against one another, there would be a multilateral default of some kind and a new devalued international world reserve currency backed by gold. That new currency could be the dollar. The status of old debt would be clear. How domestic debt would be handled remains to be seen. The collateralized gold backing would be today $6,000 and silver perhaps $300. The problem is that is now. The figures a year or two from now could be $8,000 and $400, who knows? All we know is the trend is clear.