Par for the course in a debt based fiat monetary system. Nothing new to readers of this blog. It had already happened to me circa 2005 when my Facebook account was suspended for over a month.
Par for the course in a debt based fiat monetary system. Nothing new to readers of this blog. It had already happened to me circa 2005 when my Facebook account was suspended for over a month.
If this goes through, I may have been right in speculating some two years ago that Sweden was floating a trial balloon.
Negative interest rates! The same crowd that advocates this asinine idea is the same crowd that cannot or does not want to understand that inflation has a mathematical limit.
That is “when” not “if”.
Some thoughtful soul put online a diagram to illustrate the interconnectedness of government and big business.
If this diagram shocks you, you have not been paying attention.
By and large, people are happy to present a cynical stance vis-a-vis government. In truth, few can identify the processes by which government can become a threat to the economic health of individuals or to their personal freedoms. Generally speaking, government is perceived as an entity that owes us something because it is a well worn common place to hold that government over taxes us. Furthermore, there is a fundamental misunderstanding (is it deliberate?) as to what government money is, to the extent that individuals consecrate considerable time and effort to extracting as much financial support from government as possible.
Although I don’t know how accurate the information portrayed in the diagram may be and although I am not going to check, in a context of Debt Based Fiat Money and electoral politics the symbiotic relationship of government and big business is a mathematical certainty. It cannot be otherwise.
DBFM is predicated on inflation brought about by the constant expansion of credit markets. Inflation conforms to the law of diminishing marginal efficiency. All this means is that DBFM is inherently limited mathematically. If DBFM were allowed to follow its natural life cycle, the economy would undergo regular resets during which the sponsors of the system would naturally succumb to bankruptcy. And it is this particular feature of DBFM that is most dear to its sponsors because as DBFM guarantees recurring devastating crisis, the sponsors of the system are guaranteed several opportunities to trample due process in the name of fighting an ostensible emergency that risks fire and brimstone upon society.
But the diminishing marginal efficiency of inflation also guarantees that each recurring crisis is orders of magnitude larger than the previous one. Thus, as the sponsors of the system progressively inject greater degrees of debt into same, in order to avoid saturation and catastrophic failure not only does government have to curry favor with industry and business but the monetary system must perforce assimilate other currencies and other markets too. Naturally this is a self reinforcing dynamic.
Eventually, as you do that over decades, government must perforce become the largest and most influential actor in the economy not only at home but in other countries too.
Which brings us to the moral dilemma this situation represents.
Hot on the heels of the previous post:
“In Homestead, Florida, Posse Comitatus is dead. The Air Force now responds to civilian crime in the small city, population around 30,000.”
From “The Politics of Obedience” by Etienne de la Boetie:
“[…] All this havoc, this misfortune, this ruin, descends upon you not from alien foes, but from the one enemy whom you yourselves render as powerful as he is, for whom you go bravely to war, for whose greatness you do not refuse to offer your own bodies unto death. He who thus domineers over you has only two eyes, only two hands, only one body, no more than is possessed by the least man among the infinite numbers dwelling in your cities; he has indeed nothing more than the power that you confer upon him to destroy you. “Where has he acquired enough eyes to spy upon you, if you do not provide them yourselves? How can he have so many arms to beat you with, if he does not borrow them from you? The feet that trample down your cities, where does he get them if they are not your own? How does he have any power over you except through you? How would he dare assail you if he had no cooperation from you? What could he do to you if you yourselves did not connive with the thief who plunders you, if you were not accomplices of the murderer who kills you, if you were not traitors to yourselves? You sow your crops in order that he may ravage them, you install and furnish your homes to give him goods to pillage; you rear your daughters that he may gratify his lust; you bring up your children in order that he may confer upon them the greatest privilege he knows – to be led into his battles, to be delivered to butchery, to be made the servants of his greed and the instruments of his vengeance; you yield your bodies unto hard labor in order that he may indulge in his delights and wallow in his filthy pleasures; you weaken yourselves in order to make him the stronger and the mightier to hold you in check. From all these indignities, such as the very beasts of the field would not endure, you can deliver yourselves if you try, not by taking action, but merely by willing to be free. “Resolve to serve no more, and you are at once freed. I do not ask that you place hands upon the tyrant to topple him over, but simply that you support him no longer; then you will behold him, like a great Colossus whose pedestal has been pulled away, fall of his own weight and break into pieces.
From the New York Times
“The Federal Bureau of Investigation is giving significant new powers to its roughly 14,000 agents, allowing them more leeway to search databases, go through household trash or use surveillance teams to scrutinize the lives of people who have attracted their attention. ”
And, of course from one Pastor Martin Niemoller:
First they came for the Jews,
and I didn’t speak out because I wasn’t a Jew.
Then they came for the trade unionists,
and I didn’t speak out because I wasn’t a trade unionist.
Then they came for the communists,
and I didn’t speak out because I wasn’t a communist.
Then they came for me
and there was no one left to speak out for me.
As you can plainly see, there is nothing new to what is happening today. History does repeat. We’ve seen this movie and we know how it ends… unless… unless we the people collectively awaken to the reality of what is happening. Unless we the people make a collective effort to understand what is truly important and what is truly valuable in our lives.
Historically, great upheaval has always followed periods of great excesses characterized by complacency, hedonism, selfishness, obsession with celebrity (notoriety?), heightened consumerism, instant gratification, morbid fascination with other people’s lives particularly when these people are on a quest for celebrity thus fostering a sense of righteous entitlement in youth to “get rich or die trying”.
Government as an entity is devoted to its own perpetuation and expansion perpetrated on the back of the people under the guise of social advancements. Things like Social Security, protection of certain classes or industries, subsidies or, indeed, supranational entities like the IMF, the UN or the World Bank are all subterfuges aimed at making the individual dependent on the state to the point of enslavement. All along, the gradual descent to enslavement is coated in a pleasurable but temporary narcotic mix of apparent wealth and morbid entertainment all made possible by the use of a dishonest monetary system that is rigged and skewed to benefit the monetary authority and a restricted band of politicians.
As the arithmetical limit of the monetary system is reached, great social dislocation is guaranteed necessitating grave machinations on the part of government in order to keep the masses subdued and in a permanent stupor.
Time is running out. We can still reclaim our lives. Granted, the solution does require short term sacrifice but the sacrifice required to regain our lives is purely material. All we need to do is agree to a lower standard of living today. The alternative is to let things develop to see where the chips may fall in the hope we may retain our current life style. But, look around you. See where we have been in the past ten years and observe the quickening pace of the various crisis that are afflicting us.
Time is running out. The logical outcome of the path we are on is a global conflict where you will be the soldier sent forth to fight to “preserve our way of life”.
Material sacrifice today vs sacrificing your life and the life of the children of parents in far away lands tomorrow.
If you missed or, worse still, did not think anything of repatriating a combat brigade from a theater of war in order to deploy it at home for “civilian” operations…
… or if you thought that militarizing the Boy Scouts was a welcome bit of creative fun thinking…
… then you probably won’t find it at all incongruous that a quintessentially civilian entity as the Department of Education presubably is should be gearing up for urban combat too…
And, of course, if you gear up to do something then at some point you will inevitably try your hand at doing what you are gearing up to do if for no other reason than you need to practice your new found skills… But if you are new at doing something, a degree of fuck-ups is inevitable…
… but since practice does make perfect, I would expect lots more snafus…
Lest we forget what happens when government becomes the largest actor in the economy:
Someone remind me why it is so hot these days and what we are doing in a hand basket…!?
Michael Hudson’s “Europe’s new road to serfdom” – self explanatory title and far more eloquent than I can ever hope to be. Some cogent excerpts:
“In May 2010, French President Nicolas Sarkozy took the lead in rounding up €120bn ($180 billion) from European governments to subsidize Greece’s unprogressive tax system that had led its government into debt – which Wall Street banks had helped conceal with Enron-style accounting. The tax system operated as a siphon collecting revenue to pay the German and French banks that were buying government bonds (at rising interest-risk premiums). The bankers are now moving to make this role formal, an official condition for rolling over Greek bonds as they come due, and extend maturities on the short-term financial string that Greece is now operating under. Existing bondholders are to reap a windfall if this plan succeeds. […] Finance is a form of warfare. Like military conquest, its aim is to gain control of land, public infrastructure, and to impose tribute. This involves dictating laws to its subjects, and concentrating social as well as economic planning in centralized hands. This is what now is being done by financial means, without the cost to the aggressor of fielding an army. But the economies under attacked may be devastated as deeply by financial stringency as by military attack when it comes to demographic shrinkage, shortened life spans, emigration and capital flight. ”
The emphasis has been added of course but that’s really all you need to know.
You probably don’t remember the name Bernard Von NotHaus, do you. Thankfully if uncharacteristically for the main stream press, the New York Sun does and offers this thought provoking editorial: “Von NotHaus’ Question” – cogent excerpts are too many to report without copying and pasting the entire article so whilst I hope you’ll give it a read here is a teaser:
“[…] it is hard to think of a more basic question than that being raised by Von NotHaus in respect of whether the government has the power to outlaw private coinage of money. The issue was raised by Von NotHaus’ conviction in March of two counts related to his issuing of silver medallions called Liberty Dollars. There were no complaints from the persons who bought Liberty Dollars or took them in exchange for goods. The fact is that Liberty Dollars have held their value even while the value of the fiat dollars issued by the Federal Reserve has plunged, to barely a fifth the value of what they were worth at the start of, say, the Bush administration. This is not lost on anyone looking at the case. One can imagine that this humiliation was keenly felt by the federal government that brought charges against Von NotHaus.”
The Von NotHaus question is not dissimilar to the question raised by Ashcroft vs. Arar as well as a host of other recent rulings that have all but suspended (trampled?) the constitution of the United States of America not to mention plain old decency.
But how can the government of a Western country presumably steeped in democratic principles and boasting a transparent and open society be allowed to deliberately and freely chip away at those very principles that make it the presumed envy of developing societies the world over? Why, you terrorize your own people and then you tell them they need protecting from evil forces that resent them for their way of life.
“During the years leading up to the American Revolution, the British attempted to stifle the growing independent nature of the colonies by issuing laws such as the ‘Writs of Assistance’, bypassing rights to privacy and allowing officials to search homes and businesses at will without probable cause, supposedly in the name of “capturing smugglers”. Not fully satisfied with this intrusion on the lives of the colonists, King George and his cronies issued the ‘Quartering Acts’, which required all colonists to welcome soldiers sent to subjugate them into their homes and to their dinner tables. According to law, early Americans were not only forced to allow warrant-less searches of their homes, they also had to show hospitality to the goons sent to dirty their doorsteps!
The purpose of these actions by governments is to assert their control over a population. THAT – IS – ALL. Rationalizations are always made; usually in the name of “protecting the public from harm”, but the real name of the game is imperialism, and fear. When the establishment violates the line of citizen privacy, and gives its agents the legal free reign to enter your home at will, the message they are trying to send is: “Your property is our property. Your life is our business. The law does not protect you. The law is our weapon.” In other words: Resistance is futile.“
Karl Denninger is one of the more astute observers in the blogosphere and recently he was musing on the European situation decrying the fact that Trichet implied he would like individual states in Europe to cede sovereignty to the ECB
I can’t post on Mr. Denninger’s forum because the procedure is much too complicated for someone that would only post very occasionally so I decided to make a post of my own.
The reality is that through the Lisbon Treaty, a whole chunk of sovereignty has already been ceded to an unelected EU executive body. For the ECB and the rest of the governing elite to now complete the legislative and juridical take over of Euroland, is only a formality.
… the words of Timo Soini after the fact and after they printed it unedited online yesterday.
Here is what was originally published at this link, with the omitted parts that they scrubbed bolded:
Why I Won’t Support More Bailouts
When I had the honor of leading the True Finn Party to electoral victory in April, we made a solemn promise to oppose the so-called bailouts of euro-zone member states. These bailouts are patently bad for Europe, bad for Finland and bad for the countries that have been forced to accept them. Europe is suffering from the economic gangrene of insolvency—both public and private. And unless we amputate that which cannot be saved, we risk poisoning the whole body.
The official wisdom is that Greece, Ireland and Portugal have been hit by a liquidity crisis, so they needed a momentary infusion of capital, after which everything would return to normal. But this official version is a lie, one that takes the ordinary people of Europe for idiots. They deserve better from politics and their leaders.
To understand the real nature and purpose of the bailouts, we first have to understand who really benefits from them. Let’s follow the money.
At the risk of being accused of populism, we’ll begin with the obvious: It is not the little guy that benefits. He is being milked and lied to in order to keep the insolvent system running. He is paid less and taxed more to provide the money needed to keep this Ponzi scheme going. Meanwhile, a kind of deadly symbiosis has developed between politicians and banks: Our political leaders borrow ever more money to pay off the banks, which return the favor by lending ever-more money back to our governments, keeping the scheme afloat.
In a true market economy, bad choices get penalized. Not here. When the inevitable failure of overindebted euro-zone countries came to light, a secret pact was made. Instead of accepting losses on unsound investments—which would have led to the probable collapse and national bailout of some banks—it was decided to transfer the losses to taxpayers via loans, guarantees and opaque constructs such as the European Financial Stability Fund, Ireland’s NAMA and a lineup of special-purpose vehicles that make Enron look simple. Some politicians understood this; others just panicked and did as they were told.
The money did not go to help indebted economies. It flowed through the European Central Bank and recipient states to the coffers of big banks and investment funds.
Further contrary to the official wisdom, the recipient states did not want such “help,” not this way. The natural option for them was to admit insolvency and let failed private lenders, wherever they were based, eat their losses.
That was not to be. As former Finance Minister Brian Lenihan recently revealed, Ireland was forced to take the money. The same happened to Portug-al-uese Prime Minister José Sócrates, although he may be less forthcoming than Mr. Lenihan about admitting it.
Why did the Brussels-Frankfurt extortion racket force these countries to accept the money along with “recovery” plans that would inevitably fail? Because they needed to please the tax-guzzling banks, which might otherwise refuse to turn up at the next Spanish, Belgian, Italian, or even French bond-auction.
Unfortunately for this financial and political cartel, their plan isn’t working. Already under this scheme, Greece, Ireland and Portugal are ruined. They will never be able to save and grow fast enough to pay back the debts with which Brussels has saddled them in the name of saving them.
And so, unpurged, the gangrene spreads. The Spanish property sector is much bigger and more uncharted than that of Ireland. It is not just the cajas that are in trouble. There are major Spanish banks where what lies beneath the surface of the balance sheet may be a zombie, just as happened in Ireland for a while. The clock is ticking, and the problem is not going away.
Setting up the European Stability Mechanism is no solution. It would institutionalize the system of wealth transfers from private citizens to compromised politicians and otherwise failed bankers, creating a huge moral hazard and destroying what remains of Europe’s competitive banking landscape.
Some defend the ESM, saying its use would always require unanimity. But the current mess with Portugal shows that the elite in Brussels will seek to enforce unanimity through pressure when it cannot be obtained by persuasion. Abolishing unanimity is only a matter of time. After that we have a full-fledged fiscal transfer union that is obviously in hock to Brussels’ anti-growth corporatism.
Fortunately, it is not too late to stop the rot. For the banks, we need honest, serious stress tests. Stop the current politically inspired farce. Instead, have parallel assessments done by regulators and independent groups including stakeholders and academics. Trust, but verify.
Insolvent banks and financial institutions must be shut down, purging insolvency from the system. We must restore the market principle of freedom to fail.
If some banks are recapitalized with taxpayer money, taxpayers should get ownership stakes in return, and the entire board should be kicked out. But before any such taxpayer participation can be contemplated, it is essential to first apply big haircuts to bondholders.
For sovereign debt, the freedom to fail is again key. Significant restructuring is needed for genuine recovery. Yes, markets will punish defaulting states, but they are also quick to forgive. Current plans are destroying the real economies of Europe through elevated taxes and transfers of wealth from ordinary families to the coffers of insolvent states and banks. A restructuring that left a country’s debt burden at a manageable level and encouraged a return to growth-oriented policies could lead to a swift return to international debt markets.
This is not just about economics. People feel betrayed. In Ireland, the incoming parties to the new government promised to hold senior bondholders responsible, but under pressure, they succumbed, leaving their voters with a sense of democratic disenfranchisement. The elites in Brussels have said that Finland must honor its commitments to its European partners, but Brussels is silent on whether national politicians should honor their commitments to their own voters.In a democracy, where we govern under the consent of the people, power is on loan. We do what we promise, even if it costs a dinner in Brussels, a “negative” media profile, or a seat in the cabinet.
When in Europe’s long night of 1939-45, war came to Finland with the winter blizzards, my mother was one of eight siblings being raised on a small farm in central Finland where my grandparents eked out a frugal living.
My two young uncles rushed to the front and were both wounded in action during Finland’s chapter of Europe’s most terrible bloodshed. I was raised to know that genocidal war must never again be visited on our continent and I came to understand the values and principles that originally motivated the establishment of what became the European Union.
This Europe, this vision, was one that offered the people of Finland and all of Europe the gift of peace founded on democracy, freedom, justice and subsidiarity. This is a Europe worth having, so it is with great distress that I see this project being put in jeopardy by a political elite who would sacrifice the interests of Europe’s ordinary people in order to protect certain corporate interests.
Europe may still recover from this potentially terminal disease and decline. Insolvency must be purged from the system and it must be done openly and honestly. That path is not easy, but it is always the right path—for Finland, and for Europe.
Mr. Soini is the chairman of the True Finns Party in Finland.
That reads a bit differently, doesn’t it?
Among other things there is a clear statement that Ireland was intentionally screwed. This also falls into what I reported earlier – that it was Tim Geithner who “forced” the Irish to not haircut bondholders. Never mind that the same problem exists right here in America – pretending that our problems were “liquidity.” They weren’t there and they’re not here. Period.
You don’t think that chain of responsibility being documented by the head of a political party might have resulted in a few phone calls from Treasury back to The Journal “asking nicely” to have all reference to this blatantly improper arm-twisting removed, do you?
By the way, wouldn’t such an act by a foreign government be considered an act of economic war?
I read – and reported on – this editorial as originally penned. When I was directed back to the article by astute readers I discovered the changes. Unfortunately for The Journal and others who would intentionally distort the record, the original was picked up and reprinted in its entirety in enough places on The Internet to be able to find what had been done, and reproduce it so you, the reader, can see exactly what sort of “sanitizing” of the truth our corporate media engages in.
You can find one of many copies of the original here, on a site hosted in Finland. I have reprinted the original article for the express purpose of outlining the sort of outrageous revisionism that our corporate-owned media expects us to put up with and the rampant dishonesty that is found in those so-called “Newsrooms.”
PS: Yeah, I have it as originally presented on the web page as an image file. Nice try jackals. Now how about admitting who yanked your chain and “convinced” you to strip the rest out – especially if that pressure came from Treasury, as I suspect it did.