Who really creates money?
Lets go back. Remember the definition of money; an agreement to use an accounting system to facilitate exchange? It was the trust of traders and their resulting willingness to use the agreed upon money that gave it its value, not the bank or financial manipulator. In our economy, the banks and financiers have made it seem that they are the necessary creators and managers of money. In fact, they only mediate and control the process. It is the traders on Main Street who have committed to producing value that guarantee the system.
This becomes especially obvious viewing the savings and loan bailout, and the more recent bank bailouts. If the central bankers (the house in the casino metaphor) make loans or investments that aren't payable, they claim they are too big to fail. They get bailed out. Their phantom wealth gets preferred treatment over the real wealth that traders in the market have earned.
And who bails them out? Us taxpayers -- the traders on Main Street. Members of the financial system have made sure that they pay little in taxes through their influence on the tax structure and their use of offshore tax havens. So it is ultimately the 99% Main Street traders that guarantee the operation of the money system by our bailouts as well as our faith and trust in the system.
The situation in Europe is an example of where our banking system is headed. If the banks get paid by the governments that owe them interest money, the governments will fail. If the governments don't pay the banks, the banks will fail. The phantom interest wealth created by the European bankers must be unwound, and to be just, not at the expense of the traders who created real wealth for themselves and their communities.
We are headed in the same direction here in the US. We have a greater ratio of debt to Gross National Product than the poorer nations in the European Union. As noted earlier, the only reason that the US dollar has survived as long as it has is because it has been used as the standard for international trade by all countries. That situation is rapidly changing. Just as the wars in Iraq and Libya were about protecting the dollar and its banker owners as well as about oil,xiv the present activity in Syria is related to Iran and other nations that are not members of the Bank of International Settlements (BIS), and have their own banks which are independent of the dominant currencies of the casino owners.
And now China is promoting the Yuan as a standard for foreign trade. The BRICS countries Brazil, Russia, China and South Africa are negotiating to create a development bank that will compete with the World Bank, controlled by the US, British and European too big to fail bankers that control the BIS. xv We are not in a favorable position to push back at China and its friends, as China holds a sizable amount of our foreign debt, which they are now backing off on. xvi
The present tack is to continue to pay off the central bankers, either through taxing Main Street to pay interest owed instead of providing the normal services of the government, or by privatizing the commons - government assets - giving them to the bankers instead of money payment, as is being done in Greece and elsewhere. Either way Main Street looses, and the central bankers win. The structure of the system by its nature creates phantom wealth and in so doing systematically moves real wealth from Main Street to the central bankers.
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