Adonis Diaries

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How the Dollar faired since 1913?

The US national debt is shooting over 12 trillion dollars!  (This amount is equivalent of selling off all of France wealth)

The private debt by individuals and corporations is somewhere over 50 trillion dollars.

The framers of the US Constitution specified a money system of gold and silver, to be coined and regulated in value by US Congress and prohibited by the US government from issuing paper money as stated in Article 1 sections 8 and 10 of the Constitution:

“Congress shall have Power to coin money and regulate the value thereof. No State shall make any thing but gold and silver Coin a Tender in Payment of Debts.”

The economic and financial difficulties of the US have a long history of delayed decisions based on sound real wealth resolutions.

The cause of the successive financial problems began when the US allowed a foreign private financial family, the Rothschild family of England to coin and print the US currencies in 1804.

In 1811, England waged a war against the US and entered the Capital Washington in order to coerce the US Federal government into extending the Rothschild charter for another 20 years.

During the civil war in 1862, Abraham Lincoln went solo and refused the high interest loan of the Rothschild banking system (of up to 36%) , and the government printed its own money. This decision angered the British Empire, which brought back foreign interference into printing the dollar.

The Federal Reserve Act was hastily passed just before the 1913 Christmas break. This Federal Reserve Bank is privately owned, and all the tax collected from citizens are authomatically deposited in this Bank, and it collect 2 cents no matter what denomination is printed on it….

US President Woodrow Wilson signed the act into law, turning over the money system of the country to a group of private bankers and allowed them to create money by making bookkeeping entries, loan it at interest, and take title to real property as collateral.

Congressman Charles A. Lindbergh Sr. warned in 1913: “This act establishes the most gigantic trust on earth. When the President signs this act the invisible government by the money power, proven to exist by the Money Trust Investigation, will be legalized. The new law will create inflation whenever the trust wants inflation….From now on, depression will be scientifically created.”

During the Great Depression people who had gold in the banks wanted the banks to honor their contract to redeem the paper currency for gold..

The fraudulent nature of fractional reserve banking was at risk of being exposed because there was not enough gold on deposit in the banks to redeem all Federal Reserve Notes issued promising payment in gold.

US President Roosevelt declared a national emergency and closed the banking system for two days as recommended by the Board of Directors of the Federal Reserve Bank of New York.

Congress then passed the Emergency Banking Act declaring it illegal for US citizens to own gold under penalty of up to a $10,000 fine and/or up to 10 years in prison.

The people exchanged their gold and gold certificates for Federal Reserve Notes of created dollars based on debt, which stated a promise of redemption in lawful money.

From 1914 to 1963, Federal Reserve Notes never claimed to be money, nor did they claim to be dollars. A note for five dollars read: “The United States of America will pay to the bearer on demand five dollars.”

How can a promise to pay five dollars be five dollars? To the left of the President’s picture and above the bank seal, it said: “This note is legal tender for all debts public and private, and is redeemable in lawful money at the United States Treasury or at any Federal Reserve Bank.”

In 1963, the Federal Reserve began to issue its first series of notes without the promise, while taking notes with the promise out of circulation. How can paper become what it promises by removing the promise?

To the left of the President’s picture and above the bank seal, it now read: “This note is legal tender for all debts public and private.”

Gold was now removed from the system leaving silver dollars as the only lawful money available.

The US Congress initially defined a lawful money “dollar” as being and consisting of (at least) 371.25 grains of pure silver.  Before 1965, anyone could exchange one paper dollar for one real silver dollar.

In 1965, the US’ mint stopped minting silver dollars.  

As even Silver was eliminated from the money system, the public was left with a totally scam money system of irredeemable paper currency and copper-nickel clad tokens that represent a debt owed to the owners of the Federal Reserve Banking System, the payment of which is guaranteed by the collateral of all property and income of all US citizens.

Late President Nixon did away with the gold standard in 1972 and only the US military superiority guaranteed that the dollar be the only currency for oil import and export transactions around the world…

This started the story of the PetroDollar and the long string of calamities and preemtive wars that the US waged in order to maintain its dictate…and not ending with Iraq invasionhttps://adonis49.wordpress.com/2012/05/28/us-wall-street-and-the-rothschild-financial-stories/

America’s economic problems started with issuing fraudulent receipts for gold that does not exist. This became standard procedure for the banking business.

The recent equivalent to the goldsmith’s receipt for gold is the Federal Reserve Note. The word “Note” implies a contract, because legally a note must state who is paying, what is being paid, to whom and when.

The new inflation spiral began to skyrocket.  Now it takes a whole fist full of paper dollars (i.e., “Federal Reserve Notes”) to buy one real silver dollar.  It now takes two working parents to support a family and

A note is a proof of debt. It is not possible to pay off a debt with a debt. No debt can be paid in full unless paid in gold or silver, coined and regulated in value by Congress. The name “Federal Reserve Note” is a fraudulent label since each word claims to be something that in reality it is not.

By removing the promise to redeem the note in lawful money, the Federal Government in cooperation with the Federal Reserve, eliminated the monetary system of the United States as established by the Constitution and replaced it with something totally different.

Federal Reserve Notes are only accepted because people believe they have value.

When half of the receipts circulating as a money substitute are redeemable in gold, the other half of the receipts are both credit and inflation.

When none of the receipts are redeemable, all of it is credit and inflation. Credit is inflation, therefore, the only cure for inflation is real, honest money.

A dollar is supposed to be a unit of measurement for gold and silver coin to insure uniform weight, purity, and value.

A dollar unit of paper money that is not redeemable in gold or silver coin is a dollar unit of inflation, which is a dollar unit of credit, which is a dollar unit of nothing.

The purpose of paper money that is not redeemable for gold or silver coin is to get things without paying for them. Those who issue and control paper money as credit get everything for nothing.

Paper money as credit is used to take wealth using numbers, where numbers of nothing are exchanged for things of substance and value.

This grand theft occurs in full view unnoticed because the public has been made an accessory to the crime by accepting pieces of paper with numbers on them in place of lawful money, not knowing the difference between worthless “notes” and lawful money.

Oliver Ellsworth, the third Chief Justice of the US Supreme Court said of paper money:

This is a favorable moment to shut and bar the door against paper money. The mischief of the various experiments which have been made are now fresh in the public mind and have excited the disgust of the respectable parts of America.”

Roger Sherman, a delegate from Connecticut and author of the gold and silver coin provision of the US constitution, wrote a condemnation of paper money entitled A caveat Against Injustice in which he said…

If what is used as a Medium of Exchange is fluctuating in its value it is no better than unjust weights and measures, both which are condemned by the laws of God and Man, and therefore the longest and most universal Custom could never make the Use of such a Medium either lawful or reasonable.”

Federal Reserve Notes are evidence of debt the U.S. Government owes to the owners of the Federal Reserve the payment of which is guaranteed by the collateral of all property and income of all US citizens.

When the US Government needs to borrow money, the Treasury creates a bond, and promises to pay a specified amount of money at a specified interest on a specified date. This bond is evidence of debt.

This interest-bearing debt is the foundation for America’s money supply and its payment is guaranteed by the collateral of all property and income of all US citizens.

The Federal Reserve “buys” this debt simply by making a bookkeeping entry for the amount and writing a check against no funds, and then converts it into paper currency and checkbook money.

In effect the Federal Reserve lends the US Government its own credit, and then charges interest on it.

If the public does this, it is called kiting, which according to Webster’s dictionary is defined as, “to use (a bad check) to get credit or money”.

If a citizen does what the Federal Reserve is doing he will bejailed or fined for it.

Every dollar created by the Federal Reserve System is debt for the citizens of the United States, which the central bank collects interest on, in addition to the interest from the bond created by the Treasury that put this magic money making machine in motion.

For example, when the reserve ratio is ten to one, a bank can create and loan ten dollars for each dollar held in reserve and charge interest on it.

While the reserves of the goldsmith were gold, the reserves of the Federal Reserve is paper, nothing more than bookkeeping entries that are a record of debt.

The absurdity of the situation is that if there were no debts, there would be no money, since every dollar of paper currency and checkbook money is loaned into circulation.

And, in order to pay the interest, there has to be another loan because the banking system only creates the principal and not the interest.

In fact, the interest can never be paid because it is not possible to return to the bank more dollars than were created, making it inevitable that the Federal Reserve Banking System acquire title to all wealth in the nation.

Increasing the amount of currency and checkbook money increases inflation.

Creating new dollars reduces the value of all dollars, resulting in higher prices.

By manipulating the quantity of created dollars, the purchasing power of every dollar is altered.

Depressions are the result of private bankers reducing the money supply by tightening credit and withdrawing currency, causing a drop in prices, unemployment and foreclosure of property. This is premeditated theft.

If the American people ever allow private banks to control the issue of their currency, first by inflation and then by deflation, the banks and corporation that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered.

A promise to pay money substituted for lawful money until the promise was removed.

Exchanging paper currency is not a complete transaction until payment is made in gold or silver coin. Until then, it is both credit and debt a record of a specific amount of money to be paid or received.

Credit, a deferred payment and debt, a sum of money due, are the same thing. It is hidden by deceptive double-entry bookkeeping where a debt becomes an asset by calling it a credit. Paper money that redeems nothing only appears to have value because it can be exchanged for things of value.

When a piece of paper representing debt is exchanged for wealth, someone has been robbed. Paper money transfers wealth from one person, then from another, then from another, and on and on until the last person will be stuck with it.

When banks cannot honor their contract to redeem their notes for gold or silver coins, they are bankrupt. The contract between the people and the Federal Reserve printed on each bank-note promising to pay in lawful money was invalidated because the system went bankrupt and because the amended version of the “Trading with the Enemy Act of 1917” placed all US citizens in the category of enemy, and no contract is considered valid between enemies.

American citizens were declared to be the enemy by their own government, for indeed they would be if the people ever discovered what had happened to their money.

Being unable to trade in wealth such as gold and silver coin enslaves the people to those who create and control what is being called money.

All it took to rob the public was to convince the people that paper and credit are money. The Federal Government and the Federal Reserve have the power to create unlimited amounts of credit because credit does not exist. It is not a tangible substance, but an idea represented by bookkeeping entries and computer symbols.

To pay means to deliver a tangible substance as money like gold and silver coin. Where there is no substance, there is no payment. There is only pretend payment. Banks do not really lend money, they only pretend to lend money. They put no money in a borrower’s account. They only make bookkeeping entries that are reduced as the borrower writes checks against imagined deposits.

When the banks charge interest on a loan they do not make, banks impart psychological value to numbers of nothing. Charging interest sustains the illusion that banks loan something of value, when all they do is rent the appearance of money.

Three years after signing the Federal Reserve Act into law, US President Woodrow Wilson made the following statement:

Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the civilized world–no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of small groups of dominant men.”

The Secretary of the Treasury is not the US Secretary of the Treasury because the US Treasury was bankrupted in 1933.

The Secretary of the Treasury is not paid by the United States Government. The Secretary serves as US Governor of the International Monetary Fund as receiver of the bankrupt United States, collecting the debt from US citizens.

The value of the US$ in 1940 was worth 17 times more than the value of the US$ now as a result of the Federal Reserve’s long-term monetary policy, which has quietly cooperated with the federal government to finance government deficits with Federal Reserve credit.

Thomas Jefferson said:
“If the America people ever allow private banks to control the issuance of their currencies, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all their prosperity until their children will wake up homeless on the continent their fathers conquered.

Most people assume that the Federal Reserve Bank is Federal that is, part of the United States’ government.  However, the Ninth Circuit Court put that issue to rest in 1982 when they adjudicated:

“Examining the organization and function of the Federal Reserve Banks, and applying the relevant factors, we conclude that the Reserve Banks are not federal instrumentalities for purposes of the FTCA, but are independent, privately-owned and locally controlled corporations.”
– Lewis vs. U.S., 680 F. 2d 1239, 1241]

“We have in this country one of the most corrupt institutions the world has ever known.  I refer to the Federal Reserve Board and the Federal Reserve Banks.  Some people think the Federal Reserve Banks are U.S. government institutions.  They are not government institutions.  They are private credit monopolies; domestic swindlers, rich and predatory money lenders which prey upon the people of the united States for the benefit of themselves and their foreign customers.  The Federal Reserve Banks are the agents of the foreign central banks.  

The truth is the Federal Reserve Board has usurped the Government of the United States by the arrogant credit monopoly which operates the Federal Reserve Board.”
– Congressman Louis T. McFadden, Chairman of the House Banking & Currency Committee, speech on the floor of the House of Representatives, June 10, 1932

“In the united States we have, in effect, two governments….We have the duly constituted Government….Then we have an independent, uncontrolled and uncoordinated government in the Federal Reserve System, operating the money powers which are reserved to Congress by the Constitution.”
– Congressman Wright Patman, Chairman of the House Banking & Currency Committee, speech on the House floor, 1967

“Most Americans have no real understanding of the operation of the international money lenders….The accounts of the Federal Reserve System have never been audited.  It operates outside the control of Congress and….manipulates the credit of the united States.”
Senator Barry Goldwater

“These international bankers and Rockefeller-Standard Oil interests control the majority of newspapers and the columns of these papers to club into submission or drive out of public office officials who refuse to do the bidding of the powerful corrupt cliques which compose the invisible government.”
– Teddy Roosevelt

The paper and digital currency that bankers create out of thin air is backed by nothing. The more paper “dollars” they roll off the printing presses or digital “dollars” created by computers, the less each one is worth.  Therefore, it takes more of ’em to buy the things people need, so the price of everything has to go up and up and up in endless inflation.

Wages for most people will not increase fast enough to stay ahead of the game.  But not to worry, the international bankers have created plastic credit cards – VISA, MasterCard, American Express etc., to help the people out.

The Federal Reserve is also a monopoly, in a country where monopolies are supposed to be illegal.  

The US income tax department – Internal Revenue Service (IRS) – deposits people’s income tax payments directly in the Federal Reserve Bank- not in the United States Treasury.  

Therefore, the Internal Revenue Service (IRS), an unconstitutional entity, is merely the collection agency for the international bankers.  Over the years the IRS has become a tool of the elite banking families to financially attack and/or imprison people who expose the Federal Reserve.

If you take out a paper dollar and look at it, you will notice that it states at the top of the “bill”:  “FEDERAL RESERVE NOTE”.

A “note” is, by definition, an “instrument of debt” and “evidence of debt”.  According to BLACK’S LAW DICTIONARY (Sixth Ed.) “MONEY” is defined:  “In usual and ordinary acceptation it means coins and paper currency used as circulating medium of exchange, and does not embrace notes, bonds, evidences of debt, or other personal or real estate.”

Banks can create this phony “currency” out of thin air.  Banks can loan out “currency” that they don’t even have.

When you apply for a loan from a bank, the bank does not have anything to back up that loan because they are allowed to loan out about 7 to 10 times more “currency” than they have on deposit.  This is not mere speculation; this is a matter of court record, testimony under Oath, by a former lawyer for the Federal Reserve.  In other words bankers create “currency” with just the stroke of a pen or the keystroke of a computer.

These bankers then charge you “interest” to borrow this “currency”, which is nothing more than some numbers typed on a piece of paper!  If American People ever did this they would be spending many years in an US federal prison.  Unfortunately, they do not print enough currency to pay the interest so more pseudo-dollars must be borrowed to pay off the interest, resulting in a unpayable, ever-increasing debt.

Note 1: US President John F. Kennedy planned to terminate the privately owned Federal Reserve System. In 1963, he signed Executive Orders EO-11 and EO-110, returning to the government the responsibility to print money, taking that privilege away from the Rothschild. Shortly thereafter, President John F. Kennedy was assassinated.

Note 2: The article was from Nalliah Thayabharan in response to my post: https://adonis49.wordpress.com/2012/05/15/super-nationalist-zionism-contributed-to-the-rise-of-the-third-reich/

Note 3: https://adonis49.wordpress.com/2012/06/10/privately-owned-federal-reserve-bank-how-the-rothschild-family-controlled-the-printing-of-the-dollars/

Privately owned Federal Reserve Bank: How the Rothschild family controlled the printing of the Dollars?

The US British colonies had the right to print their own currencies before they snatched their independence. Benjamin Franklin was ambassador in France and delivered a speech in London. He explained how the colonies developed and prospered by issuing money as the internal market expanded to facilitate transactions.

The Rothschild family got the message clear and set about to acquiring the monopoly of printing the US money.

In 1804, Alexander Hamilton, US finance minister and aristocrat during President Thomas Jefferson, coerced Congress to sign a charter with the Rothschild financier family to print US currencies.

This decision came as a price for England loaning Jefferson the necessary money to purchase the Louisiana Territory (all the States bordering the Mississippi River) from Napoleon Bonaparte in 1803.

In 1811, the charter for the Ashkenazi Rothschild family owned the first Bank of the United States and managed to be in control of the US money supply. This control expired and the US Congress voted against the renewal of the charter.

Andrew Jackson, later the 7th President of the US from 1829 to 1837, said:

If the US Congress has a right under the US Constitution to issue paper money, it was given them to use by themselves, not to be delegated to individuals or corporations.”

Nathan Mayer Rothschild was not amused and he stated: “Either the application for renewal of the charter for the bank is granted, or the United States will find itself involved in a most disastrous war.”

Andrew Jackson’s response to this was “You are a den of thieves vipers, and I intend to rout you out, and by the Eternal God, I will rout you out.”

Nathan Mayer Rothschild replied:  “Teach those impudent Americans a lesson. Bring them back to colonial status.”

In 1812, backed by the Rothschild’s money, the British declared war on the United States, entered the Capital Washington and set fire on it.

The Rothschild’s plan was to cause the United States to build up such a debt in fighting this war that they would have to surrender to the Rothschild family and allow the charter to be renewed.

In 1816, during President James Monroe, the charter for the Bank of the United States was renewed for another 20 years and the  Rothschild recovered the Control of the US money supply again.

The British war against the USA therefore ended with the deaths of thousands of British and US soldiers, but the Rothschild’s got their bank.

In 1819, the Bank cut-off all credits to the settlers in Ohio and the North-West territory and generated the first big financial crisis.

In 1861, President Abraham Lincoln (16th President of the US from 1860 till his assassination in 1865) approached the Rothschild’s to try to obtain loans to support the ongoing American civil war. The Rothschild’s agreed, provided President Abraham Lincoln allows them a Charter for another US central bank, at interest of 24% to 36% on all monies loaned.

President Abraham Lincoln was very angry about this high interest rate and so his government printed its own debt free money and informed the public that this was now legal tender for both public and private debts.

By April 1862, $450 million worth of President Abraham Lincoln’s debt free money had been printed by the US government and distributed. Lincoln stated:

We gave the people of this republic the greatest blessing they ever had, their own paper money to pay their own debts.”

That same year, The Times of London publishes a story containing the following statement:

“If that mischievous financial policy, which had its origin in the North American Republic, should be become indurated down (be rooted) to a fixture North-West territory, then that government will furnish its own money without cost. It will pay off debts and be without a debt. It will have all the money necessary to carry on its commerce. It will become prosperous beyond precedent in the history of civilized governments of the world.

The brains and the wealth of all countries will go to North America. That US government must be destroyed or it will destroy every monarchy on the globe.”

In 1863, The Rothschild’s used John D. Rockefeller, one of their agents in America, to form an oil business called “Standard Oil“, which eventually took over all of its competition.

In 1864, President Abraham Lincoln discovered that the Tsar of Russia, Alexander II (1855 – 1881), was having problems with the Rothschild’s for refusing their continual attempts to set up a central bank in Russia. President Lincoln asked the Tsar for help in the Civil War and the Tsar sent part of his fleet to anchor off New York and the other part off California.

The Tsar made it clear to the British, French and Spanish that if they attacked either side, Russia would take the side of President Lincoln. Lincoln subsequently won the Civil War.

In 1865, in an a statement to Congress, President Abraham Lincoln stated,  “I have two great enemies, the Southern Army in front of me, and the financial institution in the rear. Of the two, the one in my rear is my greatest foe.” Later that year, President Lincoln is assassinated.

The US Federal Reserve, an owned private institution, was created on December 23, 1913.

It was planned at a secret meeting in 1910 on Jekyll Island, Georgia, by a group of Zionist bankers and politicians. The power to print money was transferred from the US Government to a private group of Zionist bankers.

The Federal Reserve Act is hastily passed just before the 1913 Christmas break.

Congressman Charles A. Lindbergh Sr. warned: “This act establishes the most gigantic trust on earth. When the President signs this act the invisible government by the money power, proven to exist by the Money Trust Investigation, will be legalized.”

US President John F. Kennedy planned to terminate the privately owned Federal Reserve System. In 1963, he signed Executive Orders EO-11 and EO-110, returning to the government the responsibility to print money, taking that privilege away from the Rothschild.

Shortly thereafter, President John F. Kennedy was assassinated.

Another myth that all Americans live with is the charade known as the “Federal Reserve.” It comes as a shock to many to discover that it is not an agency of the United States Government.

The name “Federal Reserve Bank” is not federal, nor is it owned by the government. It is privately owned.  Its employees are not in civil service. Its physical property is held under private deeds, and is subject to local taxation.

It is an engine that has created private wealth that is unimaginable, even to the most financially sophisticated.

It has enabled an imperial elite to manipulate US economy for its own agenda and enlisted the US government itself as its enforcer.

Federal Reserve Bank controls the times, dictates business, affects Americans’ homes and practically everything in which Americans are interested.

It takes powerful force to maintain an empire, and this one is no different.

The concerns of the leadership of the “Federal Reserve” and its secretive international benefactors appear to go well beyond currency and interest rates.

Alan Greenspan, served as Chairman of the Federal Reserve from 1987 to 2006, stated at the annual Dinner and Francis Boyer Lecture of The American Enterprise Institute for Public Policy Research on December 5, 1996:

“Augmenting concerns about the Federal Reserve is the perception that we are a secretive organization, operating behind closed doors, not always in the interests of the nation as a whole. This is regrettable, and we continuously strive to alter this misperception.”

The privately owned Federal Reserve has confused the public, lied to them and stole their gold and silver.

All the perplexities, confusion and distress in America arise, not from defects of the Constitution, not from want of honor or virtue, so much as from downright ignorance of the nature of coin, credit and circulation.

Of all the contrivances devised for cheating the laboring classes of mankind, none has been more effective than that which deludes him with paper money.

After many years of blundering toward it, and only a few months before the beginning of the World War 1, Rothschild found the formula for the most efficient credit machine that was ever invented. This was the Federal Reserve System.

Most people are unsure of the meanings of words such as money, dollar, wealth, inflation and credit. The average person would be very surprised if they knew how the money system used to work compared to how it operates now.

The essence of psychological warfare is to confuse the meaning of words, and infiltrate the mind with conflicting concepts. The use of the word Federal in the name federal Reserve leads the public to believe that the Federal Reserve is a government institution, when it is really a private corporation owned by foreign and domestic banks and operated for profit.

The Federal Reserve controls America’s money supply and interest rates, and there by manipulates the entire economy, in violation of

1. Article 1, Section 8 of the United States Constitution that expressly charges Congress with power to coin money and regulate the value thereof, and.

2. Article 1, Section 10 of the constitution says “No State shall make any thing but gold and silver Coin a Tender in payment of Debts.”

Over time, gold and silver coins were removed from American money supply and removed as backing for American paper currency and replaced with debt (or credit).

The definition of dollar has changed to hide the fact that a dollar is not money, but a unit of measurement for gold and silver coin. For example:

1. Title 12 United States Code Section 152 says: “The terms lawful money or lawful money of the United States shall be construed to mean gold or silver coin of the United Sates.”

2. Title 31 United States Code, Section 5101 says: “The money of account of the United States shall be expressed in dollars.”

The recent equivalent to the goldsmith’s receipt for gold is the Federal Reserve Note. The word “Federal” implies Federal government, but the Federal Reserve is a privately owned corporation. The word “Reserve” implies that something gives the paper receipt value, but no gold or silver backs this paper.

The word “Note” implies a contract, because legally a note must state who is paying, what is being paid, to whom and when.

Most people say something like, “I have a dollar bill”. But what is a bill?

A bill is a receipt of a debt owed by one person or company to another. Therefore, a “dollar bill” is a receipt (or bill) of debt of one dollar that is owed.

From 1914 to 1963, Federal Reserve Notes never claimed to be money, nor did they claim to be dollars. A note for five dollars read: “The United States of America will pay to the bearer on demand five dollars.”

How can a promise to pay five dollars be five dollars?

To the left of the President’s picture and above the bank seal, it said: “This note is legal tender for all debts public and private, and is redeemable in lawful money at the United States Treasury or at any Federal Reserve Bank.”

In 1963, the Federal Reserve began to issue its first series of notes without the promise, while taking notes with the promise out of circulation. How can paper become what it promises by removing the promise?

To the left of the President’s picture and above the bank seal, it now read: “This note is legal tender for all debts public and private.”

A note is a proof of debt. It is not possible to pay off a debt with a debt. No debt can be paid in full unless paid in gold or silver, coined and regulated in value by Congress. The name “Federal Reserve Note” is a fraudulent label since each word claims to be something that in reality it is not.

By removing the promise to redeem the note in lawful money, the Federal Government in cooperation with the Federal Reserve, eliminated the monetary system of the United States as established by the Constitution and replaced it with something totally different.

If you are holding a one dollar Federal Reserve Note, the question is: “what is it one dollar of?

The answer is absolutely nothing. The number one measures no substance.

The only thing that give paper money value is the confidence people have in it as is stated in chapter 30 of our textbook.

Federal Reserve Notes are only accepted because people believe they have value.

Note:  The article was from Nalliah Thayabharan in response to my post: https://adonis49.wordpress.com/2012/05/15/super-nationalist-zionism-contributed-to-the-rise-of-the-third-reich/

Is US Empire on the decline trend?

The US political and intellectual classes are engaged in the answering the critical question “Has the US Empire started its declining trend or is it just a mere temporary economic malaise?” Is the decline reminiscing of the British mechanism of declining power?

The politicians and scholars who depend on the Administration favors and benefits would like to strongly disagree. They claim that when the Soviet put in orbit in 1957 its first satellite, the same prophesies of US decline was raised. When Japan acceded to the second rank economic power in the 80’s, the same brouhaha spread in the country. When China exhibited its economical and manufacturing might, the same prophesies gained wings…

The politicians and scholars who depend on the Administration favors would like us to recall that 17 out of the best 20 universities are in the US, and that the US is still attracting the best minds around the world…

Fact is, everytime the US engaged in preemptive military wars, it left big chunks of feathers behind. The American Eagle is as bald in the head and in the rest of its body…

The only power that the US has and is ready for everything to maintain is the dominance of the US dollars in commercial transactions, particularly in oil import and export…

The US has demonstrated its weakness by deploying  military force at every small oil exporting/importing country that defies the strategy of dealing solely with US currency. The US is so aware of its declining supremacy that it is vehemently getting recourse to military might to reminding the world community that the power of the dollar is based on the military supremacy of the US…

Nalliah Thayabharan wrote in response to my post  https://adonis49.wordpress.com/2012/05/18/finally-mighty-market-finance-and-liberal-capitalism-have-human-faces-to-confront/

“In 1973, the US President Nixon asked King Faisal of Saudi Arabia to accept only the US$ in payment for oil, and to buy US Treasury bonds, notes and bills with their excess profits.  America continued spending money and not pay back its loans…

In return, the USA pledged to protect Saudi Arabian oil fields from seizure by USSR and other nations including Iraq and Iran. (Nixon is the President who got away with Gold as the standard reference for money exchange rates and evaluations of wealth…)

The 1973 Arab-Israeli War upset this agreement and caused the Great Oil Embargo of 1974. By 1975, the Great Oil Embargo was over and all members of Organisation of Petroleum Exporting Countries (OPEC) accepted to sell their oil only in US$. Every nation was saving their surpluses in US$ since every country needed US$ to buy oil.

The OPEC oil sales supported the US$.  The petrodollar system was a brilliant political and economic move that created a growing international demand for both the US$ and US debt – all at the expense of OPEC.

Since only the Rothschild owned US Federal Reserve can print the US$, the US controlled the flow of oil. The US essentially owns the world’s oil for free because oil is denominated in US$ and the US$ is the only currency for trading in oil.

So long as almost three-quarter of world trade is done in US$, the US$ is the currency that States central banks accumulate as reserves. But central banks, whether China or Japan or Brazil or Russia, do not simply stack US$ in their vaults. Currencies have one advantage over gold. A central bank can use it to buy the state bonds of the issuer, the USA.

Most countries around the world are forced to control trade deficits or face currency collapse, but not the USA. This is because of the US$’s reserve currency role and the underpinning of the reserve role is the petrodollar. Every nation needs to get US$ to import oil, some more than others. This means their trade targets US$ countries.

The vast majority of the oil is traded on the New York Mercantile Exchange and the London International Petroleum Exchange and both oil exchanges are owned by the US corporations and transact oil trades in only in US$.

Because oil is an essential commodity for every nation, the petrodollar system, which exists to the present, demands the buildup of huge trade surpluses in order to accumulate US$ surpluses. This is the case for every country but one — the privately owned US Federal Reserve which controls the US$ and prints it at will or fiat.

Because today the majority of all international trade is done in US$, countries must go abroad to get the means of payment they cannot themselves issue. The entire global trade structure today works around this dynamic, from Russia to China, from Brazil to South Korea and Japan. Every country aims to maximize US$ surpluses from their export trade. Currently, over 13,000 billion of newly printed US$ is flooding into international commodity markets each year.

The petrodollar system nearly broke down during the US President Carter’s tenure, mainly due to double-digit inflation. But the US President Reagan removed all controls on oil and fuel prices and all restrictions on oil drilling to restore the stability of the US$. Oil flooded the market, prices fell, and petrodollars became more valuable. These were some of the most prosperous years that the US had,(and the worst years in south America with US initiated and perpetrated civil wars).  But the danger remained, because the US continued to spend more US$ than it earned.

The US President Reagan saw the future of the US depending on the massive international consumption of oil, and encouraged the Saudi Arabia to flood the market. This brought the price of oil down and increased the consumption –  a complete reversal of the 1973 oil embargo.

Increasing oil use boosted international demand for the US$ and the US economy soared, while the low price of oil brought the USSR economy to its knees, as they could not sell oil at a profit due to their high extraction cost. The USSR finally collapsed in 1991.

Petrodollar system created consistent international demand for US$ and upwards pressure on the US$’s value, regardless of economic conditions in the US. The high US$ allowed the US to buy imported goods at a massive discount, a kind of subsidy for the US consumers at the expense of the rest of the world. The high consumption of imports, however, hit the US manufacturing very hard.  The overvalued US$ was a major component of the bubble economy of the late 1990’s.

The reality is that the value of the US$ is determined by the fact that oil is sold in US$. If the denomination changes to another currency, such as the euro, many countries would sell US$ and cause the banks to shift their reserves, as they would no longer need US$ to buy oil. This would thus weaken the US$ relative to the euro.

The USA propagates war to protect its oil supplies, but even more importantly, to safeguard the strength of the US$. The fundamental underlying motive of the US in the Iraq war, even more than the control of the oil itself, is an attempt to preserve the US$ as the leading oil trading currency.

The fear of the consequences of a weaker US$, particularly higher oil prices is seen as underlying and explaining many aspects of the US foreign policy, including the Iraq and Libyan War.

The evidence so far definitively proves upon examination from the disclosed evidence of US government that all claims for current US wars were known to be lies as they were told to the public and not mistaken intelligence.

Until November 2002, no OPEC country dared violate the US$ price rule. So long as the US$ was the strongest currency, there was little reason to as well. But November 2002 was when France and other EU members finally convinced Iraq’s Saddam Hussein to defy the USA by selling Iraq’s oil-for-food, (not in US$, but only in Euros, the new currency of the European Union).

(Maybe the EU hastily tried to give credibility to the Euro on a worldwide scale, before it is well established in the internal European market. The fact is that the US got scared and quickly changed its policy from securing Afghanistan and into invading Iraq)

A few months before the US moved into Iraq to take down Saddam Hussein, Iraq had made the move to accept Euros instead of US$ for oil, and this became a threat to the global dominance of the US$ as the reserve currency, and its dominion as the petrodollar. The euros were on deposit in a special UN account of a French bank, BNP Paribas.

If this Iraq move to defy the US$ in favor of the euro were to spread, especially at a point the US$ was already weakening, it could create a panic selloff of US$ by foreign central banks and OPEC oil producers. In the months before the latest Iraq war, hints in this direction were heard from Russia, Iran, Indonesia and even Venezuela.

In April 2002, at the invitation of the EU, in Oviedo Spain, Iranian OPEC representative Javad Yarjani delivered a detailed analysis of how OPEC at some future point might sell its oil to the EU for euros not US$.

All indications are that the Iraq war was seized on as the easiest way to deliver a deadly pre-emptive warning to OPEC and others, not to flirt with abandoning the petrodollar system in favor of one based on the euro. The Iraq move was a declaration of war against the US$.

As soon as it was clear that the UK and the US had taken down Saddam Hussein’s regime, a great sigh of relief was heard in the Rothschild owned UK Banking cartels.

After considerable delay, Iran opened an oil bourse which does not accept US$. Many fear that the move will give added reason for the USA to overthrow the Iranian regime as a means to close the bourse and revert Iran’s oil transaction currency to US$. In 2006, Venezuela indicated support of Iran’s decision to offer global oil trade in euro.

Former Libyan leader Muammar Qaddafi made a similar bold move by initiating a movement to refuse the US$ and the euro, and called on Arab and African nations to use a new currency instead, the gold dinar. Muammar Qaddafi suggested establishing a united African Union, with its 200 million people using this single currency. The initiative was viewed negatively by the USA and the EU. Even French president Nicolas Sarkozy called Libya a threat to the financial security of mankind. But Muammar Qaddafi continued his push for the creation of a united Africa.

A gold dinar for Africa revived the notion of an Islamic gold dinar floated in 2003 by Malaysian Prime Minister Mahathir Mohamad, as well as by some Islamist movements. The notion, which contravenes IMF rules and is designed to bypass them, had trouble getting started. But today Iran, China, Russia, and India are stocking more and more gold rather than US$.

If Muammar Qaddafi were to succeed in creating an African Union backed by Libya’s currency and gold reserves, France, still the predominant economic power in most of its former Central African colonies, would be the chief loser. The plans to spark the Libya’s Benghazi rebellion were initiated by French intelligence services in November 2010.

“Wall Street” and the Rothschild owning biggest US banks

You might be suspicious that I am posting a few articles using Nalliah Thayabharan as a different pen name. That is not the case: Nalliah has been responding with extensive replies to a few of my posts.

This reply is a “comment” to my https://adonis49.wordpress.com/2012/05/18/finally-mighty-market-finance-and-liberal-capitalism-have-human-faces-to-confront/

“Wall Street is a confidence trick, a dazzling edifice built on paper promises, gambling, bets and rampant speculations. Wall Street doesn’t manufacture or produce anything.  Attractive Wall Street is built on paper.

Wall Street speculation caused a 70% increase in the price of wheat from June to December 2010 and severed food crisis in more than 35 countries.  It does not seem that there was a significant change in the global food supply or in food demand. The total value of Wall Street speculative financial derivatives reached more than $600 trillion – about 10 times global GDP.

Wall Street’s speculative derivatives are virtually untaxed and banks often avoid paying tax on profits from selling derivatives. Every consumer is paying more for commodities including food and fuel due to the excessive speculation by Wall Street.

Modern day bank robbers are at Wall Street and they wear grey suits and no masks. Rampant speculators, propagandists and financiers of Wall Street are all given some unfair advantage over the average consumers and taxpayers and the cumulative effect of the people watching selfishness prevail over the public interest has been an undermining of the public’s trust in the present US government.

There’s no question that Wall Street is rigged against the average consumers and taxpayers. Wall Street has a lot more information. Wall Street jerry-rigged the system so that Wall Street always win.  If Wall Street loses trillions, the US Treasury will bail the Wall Street out so it can go back and do it again.

About 50 trillion dollars in global wealth was erased between September 2007 and March 2009, including 7 trillion dollars in the US stock market, 6 trillion dollars in the US housing market, 8 trillion dollars in the US retirement and household wealth, 2 trillion dollars in the US individual retirement accounts, 2 trillion dollars in the US traditional defined benefit plans and 3 trillion dollars in the US non-union pension assets.

Greed, arrogance and incompetence created a massive meltdown, cost trillions, and still Wall Street comes out richer and more powerful.

There are trillions dollars of new money taken again from Americans to make deals and hand out outrageous bonuses. And when these trillions run out, Wall Street will come back for more until the dollar becomes junk. The value of the US dollar declined very significantly during the last 70 years.  The value of the US dollar in 1940 was worth 2,000% more than the value of the US dollar now.

The USA emerged from the World War II as the richest and most industrialized country in the world, with 50% of world’s manufacturing facilities. But today the USA is basically approaching bankruptcy. Many big US manufacturers are outsourcing to Mexico and China to increase their profits, adding more unemployment in the USA.

Manufacturing jobs in the USA declined 37% between 1998 and 2010. Since manufacturing industries has declined in the USA, the US competitiveness in the global marketplace has also declined.

Robust financial markets don’t imperil capitalism.  In the early 1980′s, Wall Street began to escape reasonable important regulations of the marketplace. The US government gradually adopted a “too big to fail” policy for the Wall Street, saving lenders with failing businesses from losses.

The demise of Glass Steagall act helped spawn the credit crisis by allowing the Wall Street to create financial instruments that allowed them to escape reasonable limits, including constraints on speculative borrowing and requirements for the disclosure of important facts. The extremely lucrative hedge funds and other risk management derivatives including credit default swaps don’t fund or invest in successful growing businesses. The credit default swap market was the single biggest cause of the crash 4 years ago.

Wall Street’s suicidal “liberal capitalism” built on rampant speculation eventually posed an untenable risk to the US economy—a risk that culminated in the trillions of dollars’ worth of the US government bailouts and guarantees that the US government scrambled starting in late 2008.

But in 2008, the US government was compelled to replace private risk takers at the Wall Street with government capital so that money and credit flows wouldn’t stop, precipitating a depression. As a result, Wall Street became impervious to the vital market discipline that the threat of loss provides.

Wall Street lenders of the financial markets continue to understand that the US government would protect them in the future if necessary. This implicit guarantee by the US government harms capitalism and economic growth.

The top 6 US banks had assets of less than one fifth of US GDP in 1995. Now they have two third of US GDP. The financial crisis was created by the Rothschild owned biggest US banks to consolidate power. The big banks became stronger as a result of the bailout by the US Treasury. The big banks are turning that increased economic clout into more political power. Wall Street has undue influence on the US government policies and this situation reflects a failure of democratic representation for the other 99% Americans.

Oligarchy is the political power based on economic power. And it’s the rise of  Wall Street in economic terms, that it’d turn into political power. Wall Street will  then continue to feed that back into more deregulation, more opportunities to go out and take reckless risks and capture trillions of dollars.

Wall Street only has the lobbyists. Today more than 42,000 Wall Street lobbyists manipulate USA’s 537 elected officials with huge campaign contributions that fund candidates who support their agenda. It no longer matters who’s the President of USA.

The political and economical leadership of the US has chosen to cartel profits and transformed the US economy to serve the colluding and unlawful oligarchy.  The political and economical leadership of the US is bailing out failed paradigms with trillions of dollars while committing social injustice to its people. The political and economical leadership of the US including the US Congress have now become Wall Street’s “Trojan Horses”.

The US banks are borrowing money at near zero interest from the US government, then lending it back to the US government at even mere fractions higher interest than they are paying. The net interest margin made by the US banks by lending the money back to the US federal government in the first 6 months of 2011 is 210 billion dollars.

George W Bush and Barrack Obama have doubled the US debt, and the American people reaped no benefits from it. The US military is out of Iraq.There is no victory in Afghanistan, and after a decade of protracted war, the US military does not control Afghanistan. Huge sums of US taxpayers’ money have flowed into the US armaments industries and great power invested into Homeland Security. The American empire works by stripping its citizens of wealth and liberty.

The organizers and profiteers of war and death – the past four generations of Bush family – Samuel P Bush, Prescott S Bush, George H W Bush and George W Bush along with a group of international investment bankers and corporate executives, have been instrumental in creating and profiting from extremely costly and destructive wars. Four generations of Bush family have reaped tremendous profits from the wars they orchestrated. The war profiteers of Wall Street are now pushing the US towards a nuclear war with Iran.

On 2012 New Year’s Eve, with almost no mainstream media attention given to it, President Barack Obama signed the National Defense Authorization Act of 2012, or NDAA, into law codifying indefinite military detention without charge or trial into law for the first time in American history. The NDAA’s dangerous detention provisions would authorize the president — and all future presidents — to order the military to pick up and indefinitely imprison people captured anywhere in the world, far from any battlefield.

Obama’s administration, and all future administrations can now use the military to detain individuals, including political dissidents – even American citizens on US soil – without trial or formal charges. Without court involvement or a jury deciding you are actually guilty. And “detain” is really a euphemism for IMPRISON, of course, in a semi-secret military black site, without access to an attorney, potentially for life.

Obama also signed into law what could trample American’s First Amendment rights to peaceful assembly and freedom of speech. The Federal Restricted Buildings and Grounds Improvement Act of 2011, or Trespass Bill, signed into law by Barack Obama on March 9, 2012, “potentially makes peaceable protest anywhere in the US a federal felony punishable by up to 10 years in prison.”

More specifically, peaceful protest within proximity to those protected by the Secret Service, including presidential candidates and the President, may be a federal felony now.

Worse, a former high-ranking NSA official, who spent more than three decades within the spy agency, just recently came out in a nationally televised interview and asserted that more than 20 trillion of American citizens’ communications have been intercepted – mostly without a warrant or judicial review of any kind.

The NSA is now building a $2 billion data centre in Utah to crunch all of this data. In other words, $2 billion of American taxpayer dollars are going toward spying on American citizens within the US without warrant or court approval. This is not only an outlandish waste of money, it’s illegal.

Also reporters at USA Today are now claiming that Pentagon-sponsored “propaganda contractors” have initiated a widespread character assassination and reputation destroying campaign against them.

Due to  the oligarchs’ rapacious looting and their purchase of a politically protected luxurious lifestyle, the people of the US are on the road to permanent serfdom under a police state. Tens of millions in the US live desperate slave-like existences and they hold little hope for a better life.

The democracy was not given to the people of the US on a platter. It is not theirs for all time, irrespective of their efforts. Either people of the US organize and they find political leadership to take this on or they are going to be in deep trouble.

The failures of governance to address the current critical issues have already produced catastrophic consequences. Now we are experiencing a major global paradigm shift and it is still unfolding. Thirty-two US States including California, Illinois, Nevada, Arizona, Florida, New Jersey and Michigan are on the brink of insolvency as their tattered and fading economy is now direr than ever.  Inevitably in very near future the US government will order police or military to martial law which may lead to a second American revolution.

In 1792, the US Congress adopted legislation titled “An act establishing a mint, and regulating the Coins of the United States”. Section 9 of that act authorized the production of the dollar coin and each to contain 416 grains of standard silver.

In July 1944 an agreement was reached at the United Nations Monetary and Financial Conference which pegged the value of gold at US$35 per troy ounce and the whole world looked on US$ as the gold standard in purchases.

But in 1971, the US President Nixon took the US$ off the gold standard after his administration realized that the privately owned Federal Reserve no longer had enough gold to buy back every dollar that foreign governments were handing in.

In 1973, the US President Nixon asked King Faisal of Saudi Arabia to accept only the US$ in payment for oil, and to buy US Treasury bonds, notes and bills with their excess profits, so that USA can continue spending money and not pay it back.  In return, the USA pledged to protect Saudi Arabian oil fields from seizure by USSR and other nations including Iraq and Iran….

Most countries around the world are forced to control trade deficits or face currency collapse, but not the USA. This is because of the US$’s reserve currency role and the underpinning of the reserve role is the petrodollar. Every nation needs to get US$ to import oil, some more than others. This means their trade targets US$ countries.

The vast majority of the oil is traded on the New York Mercantile Exchange and the London International Petroleum Exchange and both oil exchanges are owned by the US corporations and transact oil trades in only in US$.

The entire global trade structure today works around this dynamic, from Russia to China, from Brazil to South Korea and Japan. Every country aims to maximize US$ surpluses from their export trade. Currently over 13,000 billion of newly printed US$ is flooding into international commodity markets each year.

The reality is that the value of the US$ is determined by the fact that oil is sold in US$. If the denomination changes to another currency, such as the euro, many countries would sell US$ and cause the banks to shift their reserves, as they would no longer need US$ to buy oil. This would thus weaken the US$ relative to the euro.

In February 2011, Dominique Strauss-Kahn, managing director of the International Monetary Fund (IMF), has called for a new world currency that would challenge the dominance of the US$ and protect against future financial instability. In May 2011 a 32-year-old maid, Nafissatou Diallo, working at the Sofitel New York Hotel, alleged that Strauss-Kahn had sexually assaulted her after she entered his suite. Strauss-Kahn quit IMF on May 18, 2011.

If any country attempt to eliminate the Petrodollar system and dump surplus US$ into the international and US financial markets to cause the quick collapse of the US$ may be attacked with HAARP (see note 2) to destabilize its economy and currency and to prevent a move away from the US$ and the petrodollar system. 

War is used as a continuous foreign policy with the USA in present egregious and unlawful abuse of their superpower status.

The US manufacturers who can’t compete with low-priced Chinese goods must either lower their costs or go bankrupt. To lower their costs, many US manufacturers are outsourcing to India and China, adding more unemployment in the USA. Manufacturing jobs in the USA declined 35% between 1998 and 2010. Since manufacturing industries declined in the USA, the US competitiveness in the global marketplace also declined.

The US economy is in a deep hole and US shouldn’t dig any more. Reckless money printing by privately owned Federal Reserve – known as “Quantitative Easing” (see note 3) and economical stimulus packages introduced in the aftermath of the Credit Crunch, has made very little impact on the growth of the US economy.

Current US economic growth is not adequate enough to create jobs and to get an economy back on track. The USA is living beyond its means and cannot cut expenditures or increase taxes to narrow the deficit. Now the banks are under enormous pressure to lend more money but reckless lending by banks got the US into this mess in the first place.

The credit crunch initiated in 2007 in the subprime mortgage market in the US had devastating spill-over effects for China’s exports. The scarcity of US$, due to the repatriation and leveraging flows into the US financial system caused a sudden plunge in the external demand for goods manufactured by China and triggered the consequent lay-off of several millions of workers in China. This experience encouraged China to use its own currency in trade.

The US may have averted a debt default by compromising on how to cut the US budget deficit, but underlying problems remain and those economic woes are driving a global search for an alternative reserve currency.  The USA now needs a net inflow of several billions US$ a day to cover its deficit.

The US President Barack Obama launched his primary anti-foreclosure plan, the Home Affordable Modification Program (HAMP) in 2009 to encourage the US banks to rewrite mortgages of about 4 million homeowners at risk of losing their homes. But the fight against foreclosures continues to muddle and underwhelm. Only 300,000 homeowners received a mortgage modification in the first six months of 2011, while 600,000 houses fell into foreclosure.

The political and economical leadership of the US has chosen to cartel profits and transformed the US economy to serve the colluding and unlawful oligarchy.   The US banks are borrowing money at near zero interest from the US government, then lending it to the US government at even mere fractions higher interest than they are paying. The net interest margin made by the US banks by lending the money back to the US government in the first 6 months of 2011 is $211 billion.

The financial crisis was created by the Zionists owned biggest US banks to consolidate power. The top 6 US banks had assets of less than one fifth of US GDP in 1995. Now they have two third of US GDP. The Zionists owned big banks became stronger as a result of the bailout. They’re turning that increased economic clout into more political power.

Due to oligarchs’ rapacious looting and their purchase of a politically protected luxurious lifestyle, the US citizens are on the road to permanent serfdom under a police state. The financial situation of states including California, Illinois, Nevada, Arizona, Florida, New Jersey and Michigan is now more dire than ever.  Inevitably in very near future the US government will have to order police or military to martial law which may lead to a second American revolution.

The economic problems in Greece, Spain, Portugal and Italy are very precarious. The bailout phenomenon is not working in Greece which is on the brink of defaulting on its debt. It is impossible for the EU to bailout Italy which is the third largest economy in Europe. Klaus Regling, the head of the European rescue fund, recently said: “the EU could issue bonds in Chinese renminbi(yuan) and not in euro”.

India, 4th largest GDP and populous democracy in the world has joined with  China and Russia questioning US$ as reserve currency. India’s famed white marble monument to love “Taj Mahal” had charged US$15 or 750 Indian rupees as entry fee for each tourist, has been not accepting US$ anymore.

Brazil, Russia, India and China (BRIC) are buying each other’s bonds and swapping currencies to lessen dependence on the US$. These four countries are among the biggest holders of US Treasuries and have combined reserves of almost 3,000 billion US$.

The value of the US$ declined significantly during the last 70 years.  The value of the US$ in 1940 was worth 17 times more than the value of the US$ now. The day OPEC stops pricing oil in fiat dollars, is the day the USA will collapse completely. The reason the fiat dollar game has gone on as long as it has the US$ as the global reserve currency.

In 2011 Russia began selling its oil to China in rubles. The US debt crisis adds new urgency to the China’s efforts to promote its currency renminbi as an alternative reserve currency. China has already signed bilateral currency swap agreements with several countries ranging from Indonesia to Belarus and Argentina to promote its currency renminbi as a means of settlement in international trade.

China’s growing trade and financial links with the rest of the world will make the renminbi more acceptable. To compound matters further Japan and the China have decided to trade in their respective currencies giving a smack to the not so almighty US$.

Now we are experiencing a major global paradigm shift and it is still unfolding. If countries continue to lose their willingness to hold the US$ the impact to the US$ and the collapse of the US$ could be very  dramatic.

US Declaration of Independence, July 4, 1776, states:

“We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are life, liberty and the pursuit of happiness. That to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed.

That whenever any form of government becomes destructive to these ends, it is the right of the people to alter or to abolish it, and to institute new government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their safety and happiness.

Prudence, indeed, will dictate that governments long-established should not be changed for light and transient causes; and accordingly all experience hath shown that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed.

But when a long train of abuses and usurpation of rights, pursuing invariably the same object evinces a design to reduce them under absolute despotism, it is their right, it is their duty, to throw off such government, and to provide new guards for their future security.

Such has been the patient sufferance of these colonies; and such is now the necessity which constrains them to alter their former systems of government…”

Napoleon Bonaparte said in 1815: “Money has no motherland; financiers are without patriotism and without decency; their sole object is gain.” 


“There is no calamity greater than lavish desires, no greater guilt than discontent and no greater disaster than greed” Laozi

“Greedy desire is endless and therefore can never be satisfied” Buddha

(This article and so many others claim that “Financial Zionism” is leading the US…I beg to differ: It is the US that comprehended the influence of Zionism early on and used it to further its dominion on world finance. Zionism is glad to oblige, doing what it does best, at a the grandest of scales…)

Note 1: Since Nalliah Thayabharan article is pretty lengthy, I decided to relegate large sections, PetroDollar stories to another posts, and a few sections to footnotes such as note 2. 

Note 2: Venezuelan President Hugo Chavez has accused the USA of using HAARP (High Frequency Active Auroral Research Program) based weapons to create earthquakes. HAARP is an ionosphere research program that is jointly funded by the US Air Force, the US Navy, the University of Alaska and the Defense Advanced Research Projects Agency. The HAARP program operates a major Arctic facility, known as the HAARP Research Station, located on an US Air Force owned site near Gakona, Alaska.

HAARP has the ability to manipulate weather and produce earthquakes, since it is capable of directing almost 4 Mega Watts powerful radio waves in the 3 to 10 MHz region of the HF band up into the ionosphere. This energy can be bounced off of the ionosphere and permeate the earth and subsequently cause strong intense oscillations along fault lines of targeted areas to produce earthquakes.  Using HAARP, depending on the frequency, focusing, wave shape, adversaries can induce at a distant aiming point, a variety anomalous weather phenomena such as hurricanes, flooding, or drought.

Note 3: Benjamin Franklin opened the eyes of the Rothschild family in England on the benefits of issuing more money as the internal market in the US grows. the Rothschild family managed to be the exclusive money printer for the US in 1804. The massive printing of worthless dollars is not the case in current US, but a blatant mean to dominate world finance…

Finally, Mighty Market, Finance, and Liberal Capitalism have “human faces” to confront…

There are 63,000 capitalists owning over 100 million, and their total wealth represents the internal value of the entire world production or $40 trillion.

Two out of 1,000 individuals control 50% of the world capital exchange.  These portfolios are managed by:

1. Banks: Goldman Sachs, Santander, BNP Paribas, Societe Generale…

2. multinational insurance corporations such as AIG, Axa, Scor…

3. pension investment funds such as Berkshire Hathaway, Blue Ridge Capital, Soros Fund Management….

You may fill as many as you want after reading the list of corporations below…

For decades, the media, the political candidates and the elected public figures denied knowing who are the movers and shakers in the world of Markets, Finance, and multinational corporations.  Politicians refused to name and give human faces to these liberal capitalists.

And the liberal capitalists denied meddling in politics.

The world of Mighty Market, Finance, and Liberal Capitalism was an abstraction, money and power acting in a disembodied cloud, anonymous fluid power and might…How could any elected representative confront invisible and unidentified enemies?

French current President Francois Hollande lied on his campaign. He said: “I am fighting a veritable adversary: He has no name, no face, no party, will never be a candidate and thus will never be elected…My adversary is the world of Finance…”

For decades, politicians and financiers have been switching roles and jobs and playing musical chairs. The world of finance would finance political campaigns, and when the politician finishes his tenure, he will re-integrate the world of “private multinational corporations”, and cycle resume ad nauseam.

For example, Pierre Moscovici, President of the French industrialist lobby, financed Francois Hollande’s Presidential campaign; and Kenneth Griffin of Chicago Citadel Investment, financed Barack Obama campaign…

You recall how after the financial crisis, the US Administration and most capitalist States inducted the financiers leeches in their government? Why? The political leaders claimed there were no “financial experts” in the public service and no such “technocrats” among the entire pool of citizens who are a little conversant in finance or have any idea of how sub-primes mechanism work and function…  The kinds of John Paulson, Laurence Summers….

Now you have names and faces to confront and fight the good fight for the sanity of mankind, his miseries, and indignities.

The first list mentions the current politicians coming from the world of finance and corporations as “experts” and “technocrats”… Just to revamp, reform, and steady this confusing political catastrophic environment…by more budget restraints at the expense of the downtrodden and lower middle classes…

Italy is the first example, representing the capitalists who donned the mask of current politicians, and you watch the succession of such occurrences in the coming years. You may do the research of who is currently ruling Spain, Portugal, Ireland, Greece, the USA, Britain…

Mario Monti PM (Italy) was teaming with Coca Cola, Goldman Sachs, Fiat, and Generali

Corrado Passera (Italy),  Minis. of Economic and Development, coming from Intesa Sanpaolo

Elsa Fornero, Minis. of Work, coming from Intesa Sanpaolo and prof. of economics in Turin Univ

Francesco Profumo,  Minis. of Education and Research, coming from UniCredit Private Bank and Italia Telecom (controlled by Intesa Sanpaolo , Generali, Mediobanca, and Telefonica)

Piero Gnudi, Tourism and Sports and from UniCredit Group

Piero Giarda, Minister of Parliament relations, coming from Banco Popolare and Pirelli

The next list is of former public political figures who switched to the world of private multinational corporations (do you know the name of such specimen currently ruling in your government?):

Public Political Figure        Former Position    Political Party     Multinational Corp.

William Clinton,                    National Economic Council

Laurence Summers,                Finance Minister                           D.E Shaw

Alan Greenspan,                            Federal Reserves                    Pacific Investment Management

Paul Volcker (USA)                     Federal Reserves                                                JPMorgan Chase

Henry Kissinger, State Department, joined JPMorgan Chase

Mario Draghi                                                                                                                        Goldman Sachs

Jacques de Larosiere                                                                                                     AIG, BNP Paribas

Lord Adair Turner                                             Standard Chartered Bank, Merryll Lynch Europe

Alexandre Lamfalussy                                    CNP Assurances, Fortis

Tony Blair PM (Britain) accumulate posts with Zürich Financial Services, Landsdowne Partners, JPMorgan Chase

David Miliband (Britain Labor foreign affairs) joined Vantage-Point Capital Partner, and Indus Basin Holdings (Pakistan)

Peter Mandelson (England representative to the  European trade commissioner) joined Lazard

Wim Kok PM (Holland)                    Internationale Nederlanden Groep (ING), Shell, and KLM

Gerhard Schroder PM (Germany)  Nord Stream AG, Gazprom (Russia), Suez, and Gasunie

Otto Schily (Germany) and Minis. of Interior Social-Dem   Investcorp of Bahrein

Wolfgang Clement, Minister of work and economy, at River-Rock Capital, Citigroup (Germany)

Caio Koch-Weser, Foreign Affairs and Finance, joined Deutsche Bank

Peer Steinbruck, Finance minister, joined Thyssen-Kripp

Wolfgang Schussel PM (Austria)   Conservative    Investcorp of Bahrein

Giuliano Amato, Vice President of European Convention, at Investcorp of Bahrein

Kofi Annan (UN Secretary General), joined Investcorp of Bahrein and JPMorgan Chase

Franz Vranitzky PM (Austria)           Socialist                  Canadian Magna International

Felipe Gonzalez PM (Spain)                 Socialist                  Tagua Capital, Gas Natural

Carlos Solchaga (Spain)       Finance Minister     Socialist                    Citigroup, Fitch (Fimalac)

Mrs. Gro Harlem Brundtland  (Scandinavia)      Social-Democrat    PepsiCo

Thorvald Stoltenberg                                                   Social-Democrat     East Capital Asset Management

Goran Persson                                                                 Soc-Dem                      JKL Group (Publicis)

Lord Mark  Mallock-Brown  UNPD administrator  GeorgeSoros

Note: Post inspired from a piece by Geoffrey Geuens in the monthly French Le Monde Diplomatique, May 2012. Geoffrey Geuens teaches at Liege Univ. and is the author of “Imaginary Finance” (La Finance Imaginaire), “The Anatomy of Capitalism”, and “From financial markets to Oligarchy”

Case of a rich guy demanding higher tax rates

I have already posted on that topic a few times, but it is good for a refresher (see link in note).

David Levine, former chief economist for the investment-management firm Sanford C. Bernstein, wrote:

“I was a kid in the 1950s. And the entire time, the top marginal tax rate was 87 percent. Not many people paid that much. Only three baseball players — Ted Williams, Joe DiMaggio and Willie Mays — got there. But it was 87 percent.”

David Levine is a very rich man, and like Warren Buffett, is “begging” the government to raise his taxes.

Levine has been following federal tax policy for most of his adult life. “My main job was to forecast the economy. So taxes are tremendously important to that. And tax policy changes are tremendously important.” And, to him, those changes mostly went the same way: cutting taxes on people, like Levine and his friends, who didn’t need tax cuts, as the working class struggled.

David Levine brandishes a table that tells the whole story:

“John F. Kennedy brought the top tax rate down to 70%. Ronald Reagan brought it to 50%, and then to 28%.  I was making seven figures. They lowered my marginal tax rate to 28 percent. And the median American was paying a 15 percent marginal tax plus his payroll taxes plus the employer’s share of his payroll taxes, which comes out of his income. So the median American was paying, all in all, about 28%. And I was paying 28 percent.”

“Under George H.W Bush and Bill Clinton it gets raised a bit more to about 40% percent. But then George W. Bush comes in and cuts it to 35 percent and lowers the rate on qualified dividends to 15 percent. And by now I’ve retired. I’m living off investments. All my income is coming from qualified dividends. And so I’m sitting there in the 15 percent tax bracket. And I use the maximum charitable deduction every year. So my actual tax rate has been only 7 % every year since 2007!”

“It would be one thing if the economy had performed so much better after taxes on the rich were cut. But it didn’t. Some of the fastest economic growth of the post-war period came in the 1950s, when the top tax rate was above 80 percent. The slowest growth came in the 2000s, when the top tax rate was 35 percent. So the fastest income growth for the top 1 percent has come under the low-tax regimes, while the fastest income growth for the median American came when taxes on the richest Americans rose.

Correlation is not causation. As Doug Holtz-Eakin, a conservative economist who squared off against Levine on a panel at the Tax Policy Center, argues, the post-World War II era was good for the United States. We had a kind of global monopoly that allowed us to live large and share the wealth. But that monopoly is gone, and there’s no tax regime that can bring it back.

But the flip side of that is also true. To hear many Republicans talk, you would think that the slightest tweak to the tax rates of the very richest Americans would grind the economy to a halt. In this telling, the “job creators” would go galt and refuse to make profitable investments because the extra money they would make would be taxed at 40 percent rather than 35 percent. Or they would hide so much of their income that the tax wouldn’t raise any money anyway.

But when economists think about the role taxes play in a person’s decision to work, they think about two things:

1. There’s the “substitution effect,” where higher tax rates make you work less, because you keep less of every extra dollar you earn.

2. There’s the “income effect,” in which higher tax rates make you work more, because you need to earn more to be able to live how you want to live, or retire when you want to retire. The question is, which dominates?

Levine, who retired before he turned 50, is an example of the income effect winning out.  He wrote:

“There’s no question you would have gotten more out of me if you’d taxed me more. Think about it. You’re 40 years old, making a ton of money. But you’ve only been making it for a little while. And you’re looking at a life expectancy of 40 more years. Of course you’re going to work more years if taxes are higher! To make the money you need, you need to keep working.”

In a recent paper, economists Emmanuel Saez, Thomas Piketty and Peter Diamond looked closely at the evidence on high-income taxation.  Diamond, who won the 2011 Nobel prize in economics, says:

“The question we were asking is, where is the point where the Laffer curve — which tries to estimate when higher taxes lead to less revenue, because of either evasion or slower growth — hits the maximum revenue. You don’t want to be beyond that. But we argue you would like to be fairly close to that. Taking revenue from people making $1.2 million is better than taking it from other groups.”

The answer, they find, is somewhere between 50 and 70%. Above that, you begin to lose more revenue than you raise.  Diamond says: “So instead of the current Washington fight between Bush and Clinton tax rates, let’s think of the fight being between the Johnson/Ford/Carter tax rates and the tax rate we had after Reagan’s initial cut.”

Note: You may read my article on this topic: https://adonis49.wordpress.com/2012/02/13/maximum-yearly-wage-limit-protests-a-multiple-of-minimum-wage/

Embezzling a multinational financial corporation: “Girl-with-the-dragon-tattoo”

The heroine Salander, the young girl in the novel “Girl-with-the-dragon-tattoo” managed to hack into the hard drive of Wennerstrom Swedish multinational financial corporation and has spent days and long hours studying and analyzing the routes of the various complex transactions.

Wennerstrom was confident that the State of Sweden will never investigate his corporation and confiscate his hard drive, and he didn’t contemplate burning the hard drive into a new hard drive for his new performing computer, or even burn it into CD…

Salander is now in total control of a mirror hard drive saved in a commercial server in Holland. Read the process in https://adonis49.wordpress.com/2012/03/30/part-1-hacking-a-multinational-financial-corporation-girl-with-the-dragon-tattoo/

Salander decided that all the $billion should be transferred to her own account.  She understood that the assets were of three kinds:

1. The fixed Swedish asset, which was squarely available to public scrutiny

2. Assets in post-office-box companies in locations such as Gibraltar, Cyprus, and Macao ( a sort of clearing house for illegal mafia businesses in laundering money generated from drugs, weapons, sex, slave trade…)

3. An anonymous account in the Cayman Islands: Every 1% of every deal made in laundering money would be siphoned into that account via the post-office-box companie

Salander bought two faked passports and rented suites at two luxury hotels in Zurich (Switzerland). She walked to the venerable Zimertal Hotel costing 22,000 kronors a day, and paid 210 kronors for a bagel and two cups of coffee at the bar.

By 10 am, Salander punched in her mobile the number of a modem uplink in Hawaii.  She replied by punching in a 6-digit code and texting a message containing instructions to start a program.

In Honolulu, the program came to life on an anonymous home page on a server officially located at the university.  The program function was to just start another program on another server located in Holland.

The new program was to look for the “mirror image hard drive” belonging to Wennerstrom and to take command of the program showing 3,000 bank accounts around the world.

Any change in Wennerstrom’s accounts shows only on the mirror hard drive and the user will never notice that the actual money was indeed transferred.

Salander walked in the Bank Hauser General in Zürich for her appointment with Herr Wagner, the general manager. Herr Wagner pigeon-holed Salander as a spoiled daughter or the mistress of a big financial shot… Salander said: “There are a number of accounts at the bank of Kroenenfeld in the Cayman Islands.  Automatic transfer can be done by sequential clearing codes…” and she recited several series of 16-digit numbers  without referring to any papers (She has a photographic memory). Herr Wagner cashed 4% commission on the transactions.

Salander changed to a more normal look and outfits and met with Herr Hasselmann at the Bank Dorffmann.  She opened an account and converted a few private bonds. She then opened 5 numbered accounts which she could access via Internet and which were owned by an anonymous postal box company in Gibraltar that a broker had set it up for 50,000 kronor. Each of the 50 bonds was worth one million kronor.

Salander booted up her PowerBook and uplinked to the Net through her mobile.  She emptied the numbered accounts that were opened at Bank Dorffmann and divided the money up into small amounts and used them to pay invoices for a large number of fictional companies around the world.

When she was done, the money was transferred back to the Cayman bank, but to a different account from the one the money was withdrawn.

Salander made one payment from the Cayman account to her anonymous company “Wasp Enterprises” registered in Gibraltar.  The next day, Salander deposited the private bonds from the Cayman bank into 9 private banks in Zurich.

By 3 pm, Salander had converted 10% of the bonds into cash, a sum she deposited in 30 numbered accounts.  The rest of the bonds she bundled up and put in a safe-deposit box.

Billion were transferred before Wennerstrom could discover that he is penniless.

Salander burned every trace of her visit to Zürich, papers, wigs, cloths…

Note: The other two tomes of the Millenium series by Stieg Larsson  were published posthumously. I think the first novel The “Girl-with-the-dragon-tattoo” was the best of the three.

Maximum yearly wage limit protests: A multiple of minimum salary?

What is the current minimum wage in your country? For example, if it is $15,000 a year (you don’t have to pay a dime in taxes at that level) do you think this evaluation was meant to be able to survive in New York City? Is the minimum wage meant to exclude “unwarranted” people from overcrowding “VIP cities” without imposing explicit discriminatory laws prohibiting entrance to the “sacred cities”?

The New York Times published an alternative recourse to limiting individual maximum yearly revenues “Don’t tax the rich. Tax inequality itself” by Ian Ayres and Aaron Edlin. These “eminent” economists and jurists suggested that the max. revenue should be set at 36 times the median income.  The median revenue is the cut-off line between 50% of population income:  income lower than the median represent 50% of the poorer citizens.

Suppose the median income is $35,000 oer year. Can you rent a condo in any major city (since renting is far more economical than purchasing properties…)? Can you own a second-hand quality economical car and maintain it adequately?  Can you buy fresh fruits and vegetables and once a week steak meal?

How many houses, cars, and luxury items can someone generating $15 million a year spend on? That what 36 times median income amount to!  Do you think “perception of inequality” would vanish if the government set this limit?

Do you know that in 1918, individual revenues surpassing one million were taxed 77%?  In 1944, Congress imposed 94% on incomes above $200,000.  Even during Ronald Reagan the tax break was 50% of the rich classes, before reaching 28% in 1988. What is the tax break now on high income?

It is 35% with a stitch: All profits resulting from transactions in capital gains, shares, obligations… are taxed 15% only.  Basically, the ultra rich are plainly paying 18% tax rate.

Do you know that in 1955 the richest 400 people in the US gained only $13.3 million (after factoring in inflation) and paid 51% in tax rate?  That in 2008, the 400 richest generated $270 million and paid only 18% in tax rate?

Do you know that the same alternative suggested in the New York Times article was proposed a century ago?  Felix Adler, founder of National Child Labor Committee, had launched a vigorous campaign demanding that individual revenue be limited to $100,000 (about $2 million in current dollar)?

Back then, Amos Pinchot, chairman of American Committee on War Finance, declared to Congress:

“Two percent of the richest American capture 65% of the total wealth.  If the State has the right to confiscate the life of a citizen for the general interest (dispatching him to war battle fields), shouldn’t the State enjoy also the right to retain the wealth of the richest class in critical periods?  How can a state go to war and pretend to defend democracy and plutocracy in the same vein?”

Back to beginning: How can you spend $15 million and not exhibit status of inequality? Would Congress abolish cult clubs for strictly the rich?  Do you think the sense of inequality would vanish if you knew someone standard of living revolves around $15 million a year?

Suppose the community or State provides quality public schools for free, cover healthcare expenses, secure jobs, and cover apartment rent…How much an individual should earn maximally in order to reduce the sense of inequality among th citizens?

Note 1: Is it a coincidence? In 2011, Egypt government fixed the max salary for public servants to 35 times the minimum salary of $100.

Note 2: Post inspired from an article by Sam Pizzigati in the French monthly “Le Monde Diplomatique” # 695

Are you sure that paying taxes is an American civic duty?

Surveys would show that over 90% of US citizens claim that paying taxes is a civic duty, and that they do pay taxes out of civic duty…Is that claim true in reality?

Beside the salaried and wage workers who have no choice in paying taxes according to Congress tax laws, since their taxes are automatically withheld from every pay check, almost all “non-farm proprietor income”, meaning the self-employed in liberal jobs, small owners of enterprises, owner of restaurants… under report their real income by 60%, an amount estimated to generate over $70 billion in unpaid taxes.

The tax gap (difference between tax owed and tax actually paid) is about $350 billion, or one-fifth of all taxes collected by the IRS, or $1,000 for every man, woman, and child…

The IRS job is executing Congress tax laws, requiring tax payers to comply.  The IRS role is to “help the large majority of compliant taxpayers with tax law, while ensuring that the minority who are not unwilling to comply, pay their fair share…”

The IRS barely audit 20 out of 1,000 taxpayers per year: Congress is not about to fund this institution in order to investigate and target the big fishes. Consequently, chances is that you may not be audited in decades if the tax gap is not outrageously obvious or your business is not classified as Red for potentially prone to tax cheating and evasion.

The IRS should be investing most of its efforts on the big fishes that can afford to hire teams of tax lawyers and “tax experts” in locating loopholes as large as Oregon.  However, the IRS claim not to have the means to confront legal and protracted tax battle with the big fishes, who are generally backed by powerful politicians….

Actually, the big fishes are the ones sustaining the budgets allocated to State and Federal institutions, meant to be squandered for self-interest and self-serving objectives… For example, in 1986, Congress passed the tax law, which was instigated and suggested by tax employee John Szilagyi six years earlier, that required to list children’s Social Security numbers.  In that year, 7 million children vanished from the tax rolls, saving $3 billion a year in tax revenue.

The gist of the matter is that any government, if it will to be serious in considering citizens at equal footing in rights and responsibility, can collect every dime it owes and block any loopholes for cheating opportunities. For example, forcing the employed people to automatically pay every month…Tax laws are political in nature, and if you think that not every one is paying his fair share in taxes, how national civic duty stand?

Conversely, educated and engaged citizens who reclaim fair and equitable election laws and tax laws, can defeat any powerful governmental institution.

Note: Inspired from Freakonomics by Levitt and Dubner


adonis49

adonis49

adonis49

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