Written by Jeff Nielson Sunday, 16 December 2012 15:12
It was encouraging to see a recent article in the N.Y. Times arguing for the necessity of smashing the Big Bank Oligopoly in the U.S. Apparently not everyone has forgotten the basic fundamentals of economics.
Going all the way back to Adam Smith; all the economic theorists have acknowledged a central premise of capitalism: oligopolies (and/or monopolies) are predatory, parasitic abominations which can never be allowed to evolve in our economies. Or, as I put more succinctly in a previous commentary, “too big to fail = too big to exist.”
This premise is so self-evident that it should not even require elaboration. Yet the fact that these Vampire Banks not only exist but continue to grow shows that this simple truth is still not grasped by more than a small fraction of the population.
What is “too big to fail”? It is a group of (arrogant) Banking Oligarchs saying to the U.S. government (and governments across the West): “we’re so important that you must save us…or else.”
This is extortion. It cost U.S. taxpayers somewhere in the neighbourhood of $15 trillion in assorted hand-outs, 0% “loans”, and “guarantees” when Wall Street made its extortion demands in 2008. Since that time, the U.S. economy is much weaker, much more debt-leveraged (i.e. insolvent); and the Wall Street Vampires have been allowed to get even bigger.
The result? Serial extortion – in the form of the latest “QE” from the Federal Reserve: $500 billion per year in blackmail payments, ad infinitum. Purchasing the worst financial feces from the Wall Street Vampires, and taking this directly out of the pockets of ordinary Americans (via currency dilution).
Incredibly, the Sheep still don’t understand even this bankster crime of theft-in-broad-daylight, so perhaps a simple example will illustrate it. Seven Castaways are stranded on a desert isle. Even though they only have one “good” to purchase in their economy (coconuts); one of the Castaways happened to bring along a printing press, and so they decide to have their own money.
Ten Coconut Dollars are printed for each Castaway per month. Suddenly, one month one of the Castaways (let’s call him “Gilligan”) gets a brilliant idea as to how “they can all get rich”: print more money. Instead of printing only ten Coconut Dollars per Castaway each month they would print one thousand Coconut Dollars. So even if they never got rescued, they would soon all be “rich.”
Lacking any “Professor” to explain the folly of Gilligan’s plan, they all agree. However, what the Castaways quickly discover is that none of them are getting any wealthier at all. With their tiny island economy flooded with Coconut Dollars (one hundred times more), all that has happened is that prices also increased by a factor of one hundred.
Now let’s change our scenario slightly, and introduce a new Castaway: “Banker.” Banker happens to be the owner of the printing press, and Banker gets a different idea for “getting wealthy.” With complete control over the printing press, Banker decides that from now on while each of the other Castaways will continue to get ten Coconut Dollars each month that he will receive one thousand Coconut Dollars monthly.
Suddenly the dynamics change dramatically. Instead of our first example, where no one got any wealthier as price increases (naturally) matched the increase in the money supply; we have a much different scenario. Banker becomes wealthier and wealthier, as he continually gets a massive, new supply of Coconut Dollars.
Written by Jeff Nielson Thursday, 13 December 2012 12:42
As one of the loudest voices warning of the risks of “bullion confiscation” by our governments; it was no surprise to me to see the Corporate Media singing the virtues of bullion confiscation. What was a surprise is where this “initiative” purportedly originates: India.
Readers who follow the precious metals market are familiar with the dynamics here. Western Sheep choose to hold the bankers’ fraudulent paper currencies – despite our governments openly/explicitly driving the values of those currencies to zero with their “competitive devaluation.” It was this foolhardy mistake which is a major factor behind the greater-than-50% decline in the U.S. standard of living over the past 40 years.
Meanwhile the “peasants” in India (as well as many/most urban residents) do not engage in similar, suicidal behavior. They park their wealth in gold (and silver) bullion – immune to the print-and-dilute theft inherent in every fiat-currency system. It is one of the key reasons why Asian standards of living are rising, while those of the West plummet downward at the fastest rate in history.
In my own naivete, I had assumed that our predatory Western governments would target their own people for bullion confiscation, and look to steal the modest amount of savings of the shrewd minority in our societies who do hold precious metals. But apparently the bankers and Oligarchs have their sights set on a bigger prize: the largest private holdings of bullion in the world, in India.
Let’s be clear that this is obviously a Western proposal, as indicated by the English-speaking “front” organization used to deliver this propaganda. What is the substance of the proposal?
…Households and temples carry about 25,000 metric tons [of gold] and a successful plan to gather at least 10 percent of the gold reserves for lending to jewelers will ensure supplies for three years…
So here we see the modest goal of the Western Oligarchs: harvesting (i.e. confiscating) “at least 10 percent” of Indians’ gold, and to apparently repeat this harvest every three years – since the propagandists putting forth this trial-balloon claim that a 10% harvest would only deal with the supposed “problem” faced by India for three years.
We see further evidence that the entity spewing this banker propaganda is nothing but a Western mouthpiece, as any genuine “Indian” entity would understand that proposing to plunder the gold from India’s religious temples would be an absolute “non-starter” for its ¾ billion population.
Just as phony as the organization itself is the supposed “problem” which this bullion-confiscation scheme claims to address: what it calls India’s “current account deficit.” Here a quick definition is in order for those not conversant with this economic jargon.
A current account deficit (or surplus) represents the flow of “money” into/out of an economy. Just as nations have “trade deficits” (and surpluses), so too it is a necessary proposition of arithmetic that each year there will be some nations with net in-flows of capital, and others with net out-flows.
What is phony here is the lie behind the mythical “current account deficit” of India. As the world’s largest importer of gold bullion, each year India has a large out-flow of the bankers’ bogus paper currencies and a large in-flow of real money: gold. Obviously you cannot have a “current account deficit” (or surplus) in exchanging one form of money for another.