Prof. Carroll Quigley was an insider groomed by the international bankers. He wrote in Tragedy and Hope in 1966:
"The powers of financial capitalism had another far reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole.
"The apex of the system was to be the Bank for International Settlements [BIS] in Basle, Switzerland, a private bank owned and controlled by the world's central banks which were themselves private corporations. Each central bank... sought to dominate its government by its ability to control Treasury loans...."
The debt trap was set in stages. In 1971, the dollar went off the gold standard internationally. Currencies were unpegged from gold and allowed to "float" in currency markets, competing with other currencies, making them vulnerable to speculation and manipulation.
In 1973, a secret agreement was entered into in which the OPEC countries would sell oil only in dollars, and the price of oil would be dramatically increased. By 1974, oil prices had increased by 400% from 1971 levels. Countries lacking oil had to borrow dollars from U.S. banks.
In 1981, the Fed funds rate was raised to 20%. At 20% compound interest, debt doubles in under four years. As a result, most of the world became crippled by debt. By 2001, developing nations had repaid the principal originally owed on their debts six times over; but their total debt had quadrupled because of interest payments.
When debtor nations could not pay the banks, the International Monetary Fund stepped in with loans -- with strings attached. The debtors had to agree to "austerity measures," including:
· cutting social services
· privatizing banks and public utilities
· opening markets to foreign investors
· letting currencies "float."
Today, austerity measures are being imposed not just in developing countries but in the European Union and on U.S. States.
The BIS: Apex of the Private Central Banking Pyramid
What Professor Quigley foretold about the Bank for International Settlements (BIS) has also come to pass. The BIS now has 55 member nations and heads the global financial pyramid.
The power of the BIS was seen in 1988, when it raised the capital requirement of its member banks from 6% to 8% in an accord called Basel I. The result was to cripple the Japanese banks, which until then were the world's largest creditors. Japan entered a recession from which it has not yet recovered.
U.S. banks managed to escape by dodging the capital requirement. They did this by moving loans off their books, bundling them up as "securities," and selling them to investors.