By M. Sc. (Economics) Joern E. Vig, Denmark
Part 2
|
Not much has altered in the mind of the human
being
since Plato wrote his cave parable 2350 years
ago.
The collapse of
Japan-economy
The Keynesian wonder-medicine became a classic
example under the still running Japanese financial collapse officially
beginning in 1995. The commentors were on the spot, and could report
both this and that, and especially compare with the 1930s. Unfortunately it
was the period 1920-1927, where Japan handled precisely the same problem just
as uncorrect then as it happended recently again. With a correct reference to the
former time period we/they would have been given the chance to learn from the
experi-ence. History do not repite without further. But perhaps history
repite in the sense that, when the leaders adjust the same false way of
thinking to the same problem (perhaps against better knowledge), then the
superstitious are tempted to maintain that history repite, and totally wrong
is it not, when you ignore the blind fate of ignorance that must be
classified in categories falling under the former or the coming middle ages. WW1 speeded the japanese economy up, and it got its
fuel from the easy-money-policy. Wholesales-index more than tripled from 1913 til
Mars 1920. This was an un- ambiguous sign of a credit-policy far out of
control. The so-called boom got to an abrupt end. Already in April 1920 the
deflation had pressed the price-index down from 300 to 190. But not even this
suddenness, and the very substan-tial price-fall brought Japan on the
competition-level with its trading-partners, then their prices still were
lower. One thing that apparantly is not understood –
especially not by the leading top – is that booms are created by cheap,
easy-to-get-credits, and they always lead to a lot of bad investments that
cannot performe the needed margens of profit. For an example it has been established that about
70% of all new invest-ments here in my country do not end up with succes. The
easy-credits at price far under the market-rate of interest started all kind
of investments of which most of them turned out not to be yielding profit.
Another problem is that the cheap credit cannot go on floating, exactly
because there is not enough real capital to factors and goods of production. A lot of investments ended and still end in
financial jammed lock when they appeared not to cover the rising cost later
on. The most fateful is that govern-ments typically
hesitate to fight inflation . The other bad possebility is that the unemployment rises and free capital (also the
capitalgains from stockmarket) is treated as if it was the results of a
changed ability of saving among the consumers. The same result. What happened in Japan at this time is nearly what
is happening today. The government, the big banks and
industry-gigant-trusts got together to freeze the necessary adjustment process. And that
is the worst that can happen. By stopping the fall of the prices and thereby
prevent the adjustment process Japan was caught in a lot malinvestments
fueled by the discount credits, and that prevented the necessary captal from
floating to the areas of real expansion. The commentators reported under the last part of the
Japanese boom that the decing difference between European-economy and
Japanese-economy especially was the propensity to invest saved means
from the purchaging- power (13% of it). The investments in Europe on the
other hand were all most entirely based on loans. That was partly right; but
it was not enough. For 7 years Japan helt higher prices with its policy
than the prices on the world market. In 1927 it ended caused by internal
contradictions of this policy It was
the hardest crisis in the history of Japan. Bank-systems industry-trusts disappeared. If they had followed the example of USA from
1920-1921 the misfortunes would not have been so tremendous. It is about letting the malinvestments fall and
clean the economy for over-capacity. It must be done resolute and without
hesitation, when the inflation is beginning. Comparing with the 1980-boom in Japan with the
corresponding after WW1 in the 1920s, we may learn of what went wrong. The Keynesians are still trying to explain the
so-called ”liquidity-trap”. And it is nonsense. Liquidity has never, and shall
never be a problem. They maintain the Japanese rate of interest was
fallen to such a low level that the demand for cash increased so wild that it
was hoarding instead of letting the cash enter to the cover need for
liquidity. Naturally it is nonsense. You could have propose
inflation as well to save the Japanese economy. The idea lead the government to issue billions of
yen-notes/new credits, with which the bad loans of banks can be bought, the
assets is being overvalued etc. all most like under the Weimar-republic in
Germany. Such an insane policy is actually being performed,
as they concentrate on negative rates of interest and state-security for
banks to get the prices to move up “by stimulating the production so to
speake” in the best Keynesian manner. This corresponds to a drug treatement based on
herion or cocain. To create profit-margens in malinvestments
correspond to solve the quadrature of the circle. But that means
nothing. And the solution is also both provisional and false,
remember this when it is told in the media next time. The next recession will
be still deeper and of longer duration. Perhaps there will be no next
time. “Inflated solutions” have always operated with a
so-called stimulation of the the consumption. But unfortunenately such a policy does not remove
the malinvestments that was the problem. If the government is forced to put the monetary
brakes on – there is some-thing called state-debt-repayments, compare with
Argentina – the economy is just forced into still a deeper depression
immediately instead of later on. To cure these so-called fluctuations by monetary
injections is like doing a pusher’s job. A pusher normally works for the
kingpin, who has the money and who manage and maintain the organized stealing
and robbery that drugdealing really is. Back to the US-economy between flood tide and flood
ebb When the recovery goes into selfdestruction the
central bank (Federal Reserve) must go aside and let malinvestments be
liquidated as quickly as possible. The interference in this process just
deepening and make this pain remain for a longer time. An unnecessary pain
that unfortunately dured through all 1930s while the war was prepared. The
economy was on the other hand cleanced in the period 1920-1921. The price freeze introduced by the
Hoover/Roosevelt-goverments later on prevented the necessary readjustment to
take place. The mistake is at best a misunderstanding of the concept purchasingpower.
If the wages - that also are prices (of an working hour )) - exceeds the
value of the produced result unemployment must rise, and the free capacity must
appear. The Hoover-government tried in the best Keynesian style to keep the
nominal wages up, when the other prices fell. That meant the real wage
increased, while the value of the working-result fell. The profit-margens
declined substantial, and the unemployment rose. Almost Natural Law. If they had let the cost including the nominal (or
money-) wages readjust as in the period 1920-1921, the capacity would not
have been kept, but more real purchasingpower would have been created, and
the recession would not have been locked in depression right until WW2. In 1930 Hoover rised the taxation and the public
expenditures. In 1931 the government was worried (it announced) of, and would
oppose against the deficit on the public finances. Then they rised the
taxation again in decem-ber. In 1932 the Revenue-Law that introduced a large
number of new increa-ses in the taxes was passed. But the economy did not
recover. The increa-ses in taxation actually lead to smaller tax-yield,
because more businesses closed
and more income-sources thereby simply vanished by the taxation. Then
Roosevelt got into office and rised the taxes even more in 1935. The result was still depression, and the public
expenditures still continued to rise at the same time. “New deal” and “New economics” they respectively
were called in USA and Europe invented by the Englishman John Maynard Keynes.
In the period 1929-1935 the deficit on the public finances amounted in
average 3.6% of GDP, and the unemployment 18.6% in average. You could have followed this fact: Government
expenditures included the hastened ones do not stimulate the economy. They
all drain the economy regardless, if you find these expenditures
just. Juli 25th 2001 former chairman of the Federal
Reserve Paul Volcker reported to the Senate’s Bank Committee on the theme
“risk by increasing deficit of balance of payments”: “We are a debitor nation
with zero personal savings, and we absorb an substantial amount of the saving
from foreign countries. These enormous and increasing deficits related to
foreign countries is a sign of unbalance in the economy of the country, and
the economy of the world cannot be helt up with this.” The European nations also show
about zero net savings, I have to remind. All the
European nation (excluded Swiss and Norway).The always lacking information
is who the debitor states owe the debt to. Even if you took all debitor
states and added the sum of their debt, you would not get it to match with
sum of what the creditor states totally expect them to pay back. Why? Because
the states owe the debt to private banks with intangible accounts. So, what
is this absorbing of foreign savings-business (a few sections above)? A little
on Europe right now to understand what is going on:
Almost all states owe because the inflation have been running. They
have been trying to decrease the primery amount of montary means, and at the
same time increased the amount of government bonds and new means
(derivatives). Europe has a very high rate of unemployment (even though you
are not told true information of the amount from the mainstream-media).
Germany : Officially 3.9 mill (january 2002), but really about 10 mill.
Denmark has officially 4-5% but really 18-20% of the supply of on the labor
market. Low
interest rate easy-money policy, and public employment-subsidies to get
the malinvestments going still. Real capital is bad needed. Private
capital and earning, especially from
outside the production or outside the legal productions, has to settle down
somewhere. So increased interest rate in USA resulted in means running to
USA. A private capital-float. Financial investments, so to speake. Not a
higher propensity to save in Europe. There has been no reality in the
expected expansive effect of the decreasing EURO-exchange-rate. Speculation
is dominating relatively compared with real-production. Lack of real
capital. Back to USA to understand the
Euro-dollar-market: In 1981
former US-President Ronald Reagan signed a law that reduced the income
taxation by 25%. But he did not reduced the public expenditures. That lead to
an enormous increase in the state-debt. How was this financed in a smart way?
USA maintained a high rate of interest. Result: especially private capital
floated – as always - to the most earning-giving markets. Low taxes, high
rate of interest: US-government bonds to finance the enormous public deficit,
and also the speculation on the stock market. To buy American shares and bond
the foreigners had to exchange their money to dollars. This demand for
dollars resulted in scarcity on dollars in the foreign countries, and
therefore the foreign states had to hold more dollars in reserve to take this
exchange into account. Very
fine: Now the
foreign banks had to have these reserves of dollars, precisely as they have
had the gold in reserve. While the inflation still is going on, and the
fiat-money is used to buy imported products, something happens: Federal Reserve gets ride of much of the new-issued
uncovered (uncovered by real purchasingpower). That has contributed to
a rather stable amount of money (M1) in USA. As long as the foreigners do not
use these dollars it is as if you deposite a chech. In
this way the Americans got our products near a price zero. By importing
products that they actually do not pay for, the standard of living of the
Americans is rising. This
rising of the standard of living, and at the same time the export of monetary
means get the dollar to stay at a higher level than it really should. This
last phenomenon is transformed to lower prices for the Americans, or you
could express the same in another way: The American purse don’t sense the
prices in the same way, as the same prices hurt for example the purses of the
European tourists visiting America. Because American dollars
have become an international mean of payment it was for a long time
typically that foreign governments and central banks helt 60% of their reserves
in dollars. These reserves is certainly not dollar deposites but American
government bonds. Those are bought instead of American products. The whole world has been lending – and it still does – American
govern-ments larger and larger amounts of money. Every dollar outside USA is a loan to USA
that waits to be paid back. It finally happens, when we can afford or we can
earn profit-margens by buying more of your products and factors of
production. Now the US-production has
been fallen for the last 15 month (October 2001) The commentators talk about the Bush-recession. They
maintain that this recession is due to some tax-reductions passed in June
2001. But this pro-duction-reduction already started in September 2000. That
means nothing. It actually started 3 month before Bill Clinton left
office. We know this type of information – call it one kind of disinformation
– from Denmark, this fine way of accusing the new government for something
that the last government started, when it knew it was over. Even if the production-fall had just taken place
since Marts 2001, it is still impossible to refer to tax-reductions passed in
June, and to say that those reductions should have an effect on production in
April and June the same year. It could also be interesting to get these
ignorant people – that unfortu-nately fill up the media with nonsense – to
explain why tax-reductions suddenly can create recession. Is there not
something about tax-reductions exactely increases the consumption just like
cheap-loans? Have you ever experienced tax-reductions that tightened the
economy? Even a Keynesian would maintain the contrary. So. Perhaps they will refer to 1993-tax-rises in USA.
Apparantly these rises seemed to work, but just caused by the totally
uncontroled issuing of means made by the Federal Reserve at the same time. In
this way you camouflage , where power in reality is going , because the
citizens cannot distinguish between false and genuine means: Since 1993 the share of US-GDP being public
expenditures has increased from 17.6% to 20.6 in 2000. Finally then this entirely loose and mad monetary
policy began to close the factories caused by the inflation, and with this the
obligate falling of the profit-margens as always it was necessary to rise
taxes further to maintain the growing of the tax-financed sector. Just like in the
1930s. The objective: To centralize power further Now they have found a new gospel: “Politics After
the Attack”. Those are part of a new strategy-manual. Nothing included of
patriotisme, more resposibility, integrity or anything of that kind. When we hear the commentator (and some Senators)
tell about the stock market, we are left with the impression it is here you
have your finger one the pulse of the economy, and of almost human life in
itself. This is a lie like almost everything else. The share prices have been blown artificial higher
and higher in the 1990s just because inflation that result from every false
issuing of monetary means has been deposited in the share prices. Especially
the tertiary and perhaps the new quaternary means – that is not meant to
finances daily bread – is starting the speculation in share prices. Almost nothing of the sum of means that accrue to
the businesses as so-called investments in the own capital, is
anything but
paper and unresponsible speculative activity, and the speculators has no
other engagement than quick earning of exchange-difference based on buying and
selling, eventually new issuing of share warrants that go up at once without
any productive change. Share prices have to fall again, and that is reason
why somebody is most secure to distribute the losses from shares as much as
possible for those who has a lot loose – without loosing the possible
real influence. When all lines of businesses are facing real recession, it is
totally impossible to continue with the same or an increasing level of stock
indexes. The exchange-rate on the stock market then have to
fall, even though the ongoing malinvestments continues by “artificial
respiration”. That is one of reason for the cheap-credits, and the reason for
the experiment to rise consumption as the last link in the existing apparatus
of production. Apparently no throughts of cleansing out the malinvestments of
the 1980s and the 1990s. As time
goes by it gets worser and worser. When it comes to issuing of money it has to be
underlined that this activity it not monopolized, and certainly not managed by the
central bank anymore. The markets of finances has long ago been made
tremendous free. This fact combined with the fact that the bank lend out the
same money and credit 8-10 times tells us where we are. Those money orders
are instruments of debt, with which the bank declares it owe the bearer of
the money order a certain amount of money. As the covering only includes a
small part of the written amount on the note, the banks are really insolvent,
and the money orders may as well be regarded as mainly false. Real net savings have actually come to an end,
because the banks do not need the reserved purchasingpower for future
consumption. Just the apparatus of
production, the employed, the unemployed and the consumers -
the rest of the community – have a need for future production. What cannot go on economical,
but is expected to meet the objectives on Capitol Hill will survive on public and
fund-financed subsidiess. Denmark
today
Is certainly not what you was shown on the exibition
“Scandinavia Today”. As mentioned the citizens of Denmark are no longer
informed on economic questions concerning our nation, I repite. A
little detached talk about this and that picked from the Keynesian mess. The
level when you find special publications is about the same as that of USA, but even more influenced by
centralistic throughts, experience-empty and pure theory-with-the
head-entirely-in the clouds. Try : http://www.lilliput-information.com/engiodd/index.html The (Danish) Economic Council (with the so-called
economic wisemen) publishes reports that deal with nearly everything, but the
necessary. The environment policy included ”sustainability” and ”biological
diversity” – not further defined or selected until now – have been taken in as a exceptional part of the
creeds of which most of it obviously is dealing. That
Svend Auken (former minister of environment) and Hans Zeuthen (President of
board of the central bank) apparantly have left their marks among those
Aarhus-professors, who have dominated this council for years, is
just a smaller part of the explanation. I must have explained the rest in
this newsletter. What
they write has been wraped in peculiar unnecessary circumlocutions, and I
have to say that it must be signal-value meant for the internal actors/
agents and politicians who assumingly are meant to read it with devoutness of
which it all matters. You
get the impression that the council makes votings on what to write in the
reports. This tells us that we are in quite a (unnecessary) distance to exact
science. I don’t expect metaphors and passing remarks in a
number as you soon have experienced in this reading, certainly not. (quotations:) “Both internationally and in Denmark there has been
a recession this year (2001) with lower rates of growth. The Danish
growth-decrease is not entirely caused by impacts from outside, but it is also a
natural result of independent Danish relations among other things the economic
policy that has had the objective to avoid a superheating after the boom in
the 1990s.” [By this I understand there has been a boom in the
1990s that we cannot ride further on. That means too much money was
issued and too much cheap credit was contracted in the 1990s.] [The Keynesian prefer the booms that give him his
employment. No interest of from where the booms originate, or what we really
can do about them.] ”The recession was obvious
already in the spring (2001), where for example production of the
industry and the business-investments fell makedly in USA. Also in
Euroland the growth fell makedly in 2001 that was due to falls in the business-investments,
and the decreasing growth in export like in USA. In Japan the situation is especially critical, and
here a fall in the production is expected both this year and the next. Both
the American, the European and the Japanese central bank have reacted to
growth-recession with decreases in the rate of interest. Furthermore there
was made an substantial financial relaxation in form of tax-decreases and
increased public expenditures in USA. Then the economic policy is particular
expansive for the moment.” [You could conform to the following fact: government expenditures do not stimulate but drain the economy. This is true regardless
if you find these expenditure just or you do not. A Danish example for
illustration: http://www.lilliput-information.com/lek2.html#fs ] ”The
demand in the short run may be effected negatively via fall in the consumer-
and the investor-confidence. There is also a risk that consumption and
investments will postponed due to the increased uncertainty. However it is
expected that the substantial monetary and financial relaxations can
contri-bute to the secure confidence, and thereby ward off the negativ
recessive effects. From 2002 the domestic demand is expected to increase,
primery driven by the increase in the private consumption. Thereby the
domestic components of demand take the objective as machines of growth, even
though the net export constantly will contribute positively to growth of
GDP.” (unquote) We know the fall in the
USA-production has lasted for more than 17 month (december 2001). The same have happened all over Western Europe in
more than a year. We also know that this has noting to do with tax-decreases in USA (the Danish experts do not maintain that, I
have to say). The growth in the American public expenditures is expected to
be primery war-expenditures and law-enforcement-consumption-expenditures, but
it does not matter. That the demand can be effected by a fall in the
consumer- and investor confidence is simply nonsense, it is meaningless.
That lowering the interest rate will get the consumption to rise, and that more
consumption increases the business-investments is also nonsense. Ther
machines of growth is certainly not domestic consumption. This correspond to: When a
household with both parents full time at work has economic problems,they just
hire a domestic help. Now you expect more false notes issued and more
foreign tax-relaxations to cushion the negative effects of the whole
wretched business that started because too many means of money were issued
and too much cheap-credit was accepted earlier. Or let me expresse myself in
another way: You hope-fully solve a problem by making the problem larger. The increases of the consumer-prices are moderate, low growth in the domestic demand, and it is the same recessions all the way round. Denmark has
been put on the back burner. Or as it is expressed: The utilization of the
capacity is close to the limit. In reality Denmark has 18-20%
unemployment. They
simply do not tell us why the business-investments are falling, and they maintain
that the demand will create growth…”even though the net export still will (be allowed)
contribute positively to growth in the GDP.” We are
simply not allowed to know the cause of the booms and the reces-sions. Why
the fall in the industrial production and the business-invest-ments continues, in both
USA, EU and Japan in spite of interest-reduction after. This
is the Keynesian in training. Hot air. He prefer rising taxes, and a still
growing amount of means what so ever. Result: His sector grows easy and gentle
without too much attension of the citizens. Still growing public
expenditures absolute and relatively, that is his way to go.
In USA the public expenditues reached 20.6% of GDP
in 2000. In
Denmark they reached 57.5% in 1996. Does the reader understand how the consumption rises,
when produc-tion decreases in USA, in Japan, and growth rate falls markedly
in Europe? Precisely as I have reporting: The stocks are being
emptied and malinvest-ments are helt, until there are nothing else. That is
what is going on. Somebody would call it centralism. It is still written in the statutes of the Economic
Councel that it has to deal with long run too. It would be utmost convenient,
if they would tell us, where tax-increases, still growing amount of money, and
still more cheap credits lead us, when they apparently cannot think of any
other instruments against the evil. The taxes and the public expenditures drain the
purchasing-power out of production, and the false means of inflation
including stagflation filled in the exchanges on stockmarket at last also
removes the intiative, the production , the employment and the future
consumption. You may use artificial snow, but at a moment you
have to remove it again, and it is troublesome the more snow there is.
Natural snow disappear without further. If it stays because it still falling,
then you can take it away in a wheel-barrow by running several times. You
don’t have to remove the snow you already have removed. One of the funny ones by professor Joergen Pedersen
who was a faithful Keynesian servant wrote in “Topical Questions”,
1939: …”it is not a natural law that state-debt has to be
repaid at all. Naturally the state has to repay a loan, when it become due,
but if it is found appropriate to reduce the debt, the repayment can always be
done by contracting a new loan……It holds good for contracting of loans and
repayments as well that the only thing that matters is how it effects on the
economic life or the welfare of the community.There cannot rational be given
reasons for repay state-debt, unless the effects of the repayment are considered
wanted. If at any moment the demand for labour is strong
under full employment, and the result then only can be an increase in wages
that will lead to increase in the prices, yes, then it is appropriate to
collect more taxes than necessary to finance the current public expenditures,
that means repayment of the debt, because thereby a restrain is put on the
demand for resources, before such a state has occurred or rather before you
want to reduce the demand and the income in the community or at least reduce
its increase no reduction of the state-debt can rational be argued …”
(unquote) Then and Now: When the debt is a problem, you just contract more
debt or find another lender offering artificial low interest-rates, but
you have to hold back the payments of debt
until nobody else want to use the purchasingpower, I would express his throughts. ”…found appropriate”…what is meaning that - can I say the
same with my debt – can Argentina? ”…considered wanted”…its up to you, politicians, I
don’t know. ”…if more taxes are collected than necessary to
finance...”…. you only
repay if you cannot find anything else to do, I read it. “…Such a state has occurred”…such a state never
occures…. and it was1939 just before WW2 that might have
influenced his wise advice. In addition the extra taxes are almost consumed by
the public sector everytime lead to further disturbance of investment and
production, and this can certainly not be called repayment. To
this could be added that Professor L. V. Birck had not by accident seized on
the question about the balance account of the community without any foundation(classical
economic), including insolvence, even though this balance is not very easy constructed, and put into an useful formula. When the state-debt rises quicker than GDP then the
direction is the same as the direction of the immigration in order consume
more of social security. The real estate is being taken over by others. J.M.
Keynes maintained: ”We all dead in
the long run” What a visionary truth to inspire our economic
thinking for ages? *) The amount of monetary means is almost entirely
decided by private central banks, in
USA by Federal Reserve System. The amount of monetary means is divided in groups
arranged by the degree of liquidity (the distance to the daily transactions).
M1 is cash in form of notes, coins and not at least short-term credits that
can enter the circulation at once. M2 and M3 are means of payment, medium and
longer-term, bonds, shares warrants and share certificates, and a lot of
other means of credit, latest derivatives. The amount of money, the rate of interest and the
taxation- and expenditure-policy of the government are deciding all together
the so-called booms, the recessions and the recoveries of the economy. By letting the market of shares turn into poor
speculation after a long period of inflation, and even though this same
inflation is the reason for the bad figures in almost any business line, the inflation actually has been partly
removed from the product-prices. On the other hand ordinary people, and
among others the pension-savers and other institutional savers participate in
the hot-air-play. Last year Danish pensioners lost dkr. 300 billions on this
market. When Allan Greenspan (President of the Federal
Reserve Board) apparantly experimented/junggled with the concept of money, and thereby
with the easily influenced reality (casino-play on the exchange-delopment is
the last instrument taken into action), especially the least liquid mean M3,
or called them M4, have been increased tremendously. From Juli 1994 to October 1997 M1 fell by 7,7% in
return. Right now it looks as if M1 is being increased a little again, but it
not easy to get reliable figures However no doubt that the amount of money totally
still are increasing (December 2001). The stated amounts above are as far as I could find out
exactly the total increase. As you may understand there is free rein to
privatize the issuing of money further in top, when is taken into
consideration that stock-market exchange-rate-earnings and other earnings
from speculation can be circulated as real purchasingpower at once and be use
via a M1-deposite. Futher more a part of the speculation markets almost pays
for itself without the traditional means involved. Besides Long Term Capital Management Fund (LTCM)
that even was able to threaten any market in the Western world. There are
4,000 of those unregula-ted funds in USA. With less than 100 investors in
such a fund, it can remain unregulated by US-law. There is a general suspicion
of a lot of other funds also having or getting problems similar to those of
LTCM, so the banks that lend out to those will perhaps suffer enormous losses.
With a fortune of $4 billion LTCM took potential the
risks of $1.25 trillion by derivative-arrangements. The whole sum based on
bankloan and /or commitments of bank security. These commitments were recklessly
given by the American banktop without any possible risk-assessment of the
debitors or their actions. The theoretical risk of the total
derivative-amount rises all the time atmost extremely and apparantly
without any management at all. In
2001 to $7 trillions (not documentated). This number can not be compared with
anything. Federal Reserve reported that an uncovering of the dipositions the
of LTMC-fund could had brought a threat to the whole world-economy. Therefore
a riscue package to the first involved banks. The tax-payers pay
higher prices as the final result. We hear that among a lot of other things Danish
bonds are included in the possible, but strongly unknown value-basic of the
derivatives. Perhaps gold and silver. There
is presumeably opened for a double-headed panic-market that may be used as an
insurance-instrument for the involvement of big banks, when the collapse is
made. A
little inspiration from history to the understanding
Not much has altered in the mind of the human being since
Plato wrote his cave parable 2350 years ago. The power is placed by a few men , L. V. Birck wrote
in 1925; the report of the American Pujo-committee (then) had investigated on the
question, if a money trust existed. It shows that a few men’s power over all
the banks, insurance companies and leading industries in the East-states
already in 1912. It is organized by interlocking directories. In Denmark jurist Robert Mikkelsen delivered Birck
interesting reviews on Danish relations that totally confirmed similar
relations (1925 perhaps 1912) in Denmark. Extracts
from: ”The Rothschilds”, History of the House, by Ignaz Balla, and autorised
translated to Danish and Norwegian by Carl Behrens, published by V. Pio,
Copenhagen 1914. These extracts are hereby retranslated to English of
what I ask for an excuse. I did not have and could not find the English original
anywhere: [We are in London just after the Battle of Waterloo
that Nathan Rothschild himself secretely had followed more closely, and knew
the true outcome of] (quotation) “In the enormous exchange hall a movement like in an
alarmed swam of bees ruled. The usually very cool exchange gentlemen went
nervous and alarmed up and down, whispered short comments to each other,
exchanged understanding signs, and everyone of them trembled in his soul and
body of something unknown. The reports of selling and buying
flew from one to another. With soft voices they discussed Blücher’s defeat,
and from one ear to another the information it was whisled of how Napoleon’s
heavy lifeguard has defeated Wellington's army. Already the unconfirmed
rumours were enough in these worried moments to get people entirely to loose
their heads. And this sinister state reached its culmination, when the
visiters of the Exhange caught sight of Nathan Rothschild. There he leaned
like a hunted to death against a column, and seemed in his miserable condition
not to be able to stand on his feet – he, the cool calm Caesar, who otherwise
the most furious panic of the exchange was not able to bring out of control” ”What you until now had considered as unconfirmed
talk, now it took shape of unrefuted truth, Nathan Rothschild face talked for more severe than the around-whirring indefinite rumours. All over
the Exchange the panic fear blushed as an electric spark that the most
implacable, most passionated enemy was free again, and that nobody would be
able to stop him on his way, when as a scrouge from God would overthrow
Europe.” ”Like a destroying cyclone the fear possessed City. The information took still more more certain shapes, they grew like an
avalance, and as they were shaping to true pictures of horror, they filled
the people with dismay. Wild panic croped up. The exchanges fell from minute
to minute, at last there was no bottom to find, and as you noticed that not
Rothschild alone, but also his agents supplied the papers for sale in big
blocks, yes really through them into the market, then there was nothing that
could stop the fall of the shares. Like madness had moved the crowd, the most solid and strongest
bank-houses began to totter within a few minutes, and the exchanges of the
most secure papers turned sumersaults like idols, as believings that in their
disappointment has taken possession of revengefulness, fall down from their pedestal and smashes.” ”However the deathly pale man at the column laughed
in his beard. While concerning soels were sorry for Nathan Rothschild
which enormous firm that they throught was gone down and ruined by enormous
losses, he let without making any notice his secret agents, who were not
known in this trade, buy all supplied papers.” The following day the information arrived that
Blücher had won victory at Ligny and Wellington at Waterloo. Rothschild himself
gave the information with a shining face at the opening of the Exchange,
the exchange rates rose rapid, and reached an until then unknown high level.
He has in one day earned about dkr. twenty millions. At this time the winged
word: The allied won the battle of Waterloo, but in reality
Rothschild was the one who won.” (unquote) More extracts from the quotations (until now in
Danish) on: http://www.lilliput-information.com/dkri.html Money
should be both a product of a market, and at the same time a right. That
is simply nonsense If
money is a right in completely contrast to a market product – everything is
fine, if this right is enforced utterly severe. If money is a market product in completely contrast
to a right – everything is fine, if nobody have the possibility to interfere in
any issuing of means on any market.
Does a metallic standard of value prevent this
To read further on American and international
relations I can recommend: http://store.yahoo.com/realityzone/creature2.html http://www.lilliput-information.com/truth/tru1.html We
have not dealt with foreign trade and exchange rates of currency. This is
dealt with on: http://www.lilliput-information.com/intmo.html |
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