Financialization & The Road To Zero, Part 4: Wars, Waste, Wall Street, Welfare, & What’s Next

financialization-&-the-road-to-zero,-part-4:-wars,-waste,-wall-street,-welfare,-&-what’s-next

07-10-20 08:04:00,

Authored by ‘ICE-9’ via The Burning Platform blog,

This is Part 4 of a 4-part series.

Read Part 1 here…

Read Part 2 here…

Read Part 3 here…

http://www.zerohedge.com/

What Financialization Really Is

But what really is financialization?  Its simplest definition is, separated from the buzz and energy of its surface world, the present hedging of an entire nation’s aggregate asset value plus the hedging of all future profits derived from these assets in every sector of the economy, both public and private.  This hedge is accomplished through maximizing the amount of debt leveraged against every conceivable tangible, intangible, and imaginary asset class, including the national citizenry.  In perfectly efficient financialization, all accumulated liabilities eventually balance to zero against the aggregate net present value of the national asset base, plus all future profits generated by that asset base.  Maximizing this leverage is accomplished through a coordinated program of zero real interest rates (or less), combined with the creation of tens of trillions in new fiat money used by first-tier recipients – i.e., Federal Reserve System member banks – to monetize this national asset base.  Thus financialization is, at its core, the national descent into zero aggregate net present value and is, for lack of better terminology, the great cashing-in of an entire nation by its financial overlords.

When this national asset base and all its future profits are fully monetized with debt, the entire ownership and control of the national economy are transferred from stock owners (second tier unsecured liens) to bond owners (first tier secured liens).  Therefore, full and efficient financialization turns the entire focus of national economic endeavor away from generating profits that fund discretionary capital investments that lead to collective economic growth, towards generating revenue to cover ever increasing non-discretionary interest payments for a concentrated select group of bond holders.  Growth sustaining capital investments eventually evaporate as these increasing interest payments devour more and more discretionary spending, and thus “business” becomes a quest to continually whittle away at its remaining discretionary cost base, like labor and innovation, while simultaneously acting out a facade surrounding “shareholder value” for the decreasing number of shareholders who become increasingly irrelevant with every new corporate bond issue and share buy-back. 

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Financialization & The Road To Zero, Part 3: From Financialization To Breakdown

financialization-&-the-road-to-zero,-part-3:-from-financialization-to-breakdown

06-10-20 04:32:00,

Authored by ‘ICE-9’ via The Burning Platform blog,

This is Part 3 of a 4-part series.

Read Part 1 here…

Read Part 2 here…

http://www.zerohedge.com/

August 15th, 1971.  America’s 108 year run with capitalism was over.  The Nixon Shock – or was it?  The dog that didn’t bark during the late 1960s gold run was the US Treasury, the only piece left in the Federal Reserve System that could claim some independence from the central bank cross ownership nexus.  Its lack of action to either raise official gold prices to slow the withdrawals, or close the gold window earlier as foreign dollars washed ashore onto its financial beachhead suggests collusion in the purposeful destruction of capitalism’s pre-eminent precious metal reserve.  We are led to believe that America was propelled by surprise and necessity into its new commercial model divorced from physical gold reserves and silver stockpiles, but when one follows the money what was originally billed as an unexpected emergency reveals a decade long ruthless history of preparation.

The US Treasury wasn’t so passive during the early 1960s and had quickly transformed into a serious existential threat to the central bank cross ownership nexus.  Silver had become a contentious issue when the US Treasury’s silver stockpiles decline by 80% in a matter of months during a 1961 purchase run – possibly depleted by banking agents in an offensive action to create artificial scarcity and render it perceived unreliable as money.  But President Kennedy halted government silver sales in late 1961 and, after rebuilding the stockpile, signed his fateful Executive Order 11110 in June 1963 directing the US Treasury to issue debt free United States Notes based on a non-fractional 1:1 ratio to the silver stockpile.  Thus a new form of American money was born – one that did not pay interest to the central bank cross ownership nexus – and did not conform to the working definition of capitalism.  This interest free money was placed in direct competition to the heavily fractional and interest paying “gold based” Federal Reserve Notes in circulation and more than $4.3 billion of this new debt free money was issued.  But although these notes were only about 1% of the total M2 money supply,

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