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It's a Mad, Mad World!

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I'm convinced that subversive geniuses are working within the ranks of the world's ruling elite.  There was for example the acronym for "Operation Iraqi Liberation"- and all the talk by the last 'leader of the free world' about going on Crusades in the Middle East.  And now there is (or was) "the Irving Fisher Committee [IFC] workshop"- to deal with the current global financial depression.[i]

 

You may never have heard of Irving Fisher or the "-Chicago Plan' popularized in his book "100% Money"-.  But Wall Street types and anyone who handles serious money knows who Fisher is - at least those who received their education more than 20 years ago.  In the depths of the last Great Depression, Fisher--perhaps the best known American economist in the first half of the 20th century--and a group of the nation's leading economists assembled to figure out what went wrong and propose measures to insure it never happened again.

 

Needless to say Fisher and the Chicago Plan recommendations (an updated version of which in embryonic form can be found here- http://www.monetary.org/amacolorpamphlet.pdf) were ignored.  The basic concept of the Chicago Plan is not rocket science:  since our money supply comes almost totally from privately-created debt, when that debt goes bad, i.e. when the debtors are no longer able to pay the interest, the money supply, AKA "frozen credit markets", vanishes.  If, instead of basing the money supply on privately held debt, it were based upon publicly-created money and bankers were required to borrow that money from the public, earning their profit from the spread between what they pay for it and the interest rate at which they loan it to the public, then the economy's money wouldn't vanish at the first sign of an economic downturn.

 

Actually, the money supply is based upon a large multiple of those - at least in the beginning banker-created - debts through the miracle of fractional-reserve banking -- wherein the bankers' original capital, assets created by new loans and depositors' money are magnified to stratospheric proportions. Those proportions are held in check mainly by capital requirements imposed on all banks by the central bankers' central bank--the Bank for International Settlements.  Particularly since the invention of 'financial engineering'--in  the run-up to the Great Depression they called it something else--the fractional-reserve requirement old-fashioned bankers recognized as necessary to instill confidence depositors' money that was no longer in the bank could be accessed if they - the depositors - really, really wanted it.  But that's another book.

 

In case the joke is still a little obscure, let me explain since there isn't really a punch line.  Fisher and the Chicago Plan economists come up with a solution for the problem that caused the last Great Depression - which differs from the one on the horizon only in the scale of banker over-reaching in the run-up to the next Greater Depression.  The Chicago Plan / American Monetary Act may not be perfect but it or just about anything is likely to be better than what we have now.  The world's leading money whizzes gather in Washington, DC at the IFC Workshop to devise a plan to save us yet again.

 

Rich, I tell you!  Rich!  If you want more than black humor--if you are SERIOUSLY interested in "The Role of Money", check out the guy who wrote this:

"There is a growing exasperation that an age so splendid and full of the noblest promise of generous life should be in such ill-informed and incompetent hands."[ii]

If you just want the Cliff Notes version of Soddy's ideas (from whom Fisher MAY have pinched his 100% reserves.  If there are any economic historians left, let THEM settle the question.), check out "Money Versus Man".



[i] "Bankers to the rescue"-, Alfred Mendes, http://www.globalresearch.ca/index.php?context=va&aid=12811

[ii] The Role of Money, Frederick Soddy, George Routledge & Sons, Ltd., 1934

 

Steven Lesh is a retired software engineer with a life-long interest in economics and an undergraduate degree in history.
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