When the Money Supply Dries Up

01-06-21 03:08:00,

In 1944, the US had been the primary supplier for arms for the allies during World War II and, as such, exited the war with more wealth than any of the other nations that had entered the war earlier, draining their treasuries of money. Since payment was largely demanded in gold, the US held three-quarters of the world’s gold and therefore was in a position to call the shots with regard to the free world’s economic future.

At Bretton Woods, the US took advantage of this situation, setting up the World Bank and the IMF and declaring the dollar to be the default currency for all countries concerned. From that point on, the US was in the catbird seat, able to dictate economic terms to other countries and even to behave irresponsibly, eventually creating previously unheard-of levels of debt, thereby inspiring other nations to do their best to create their own debt in order to keep pace as best they could.

Eventually, of course, such irresponsible economics will cause any country, no matter how powerful, to collapse economically, no matter how many Keynesian economists such as Thomas Piketty, Paul Krugman, and Larry Summers declare otherwise.

Beginning in 1944, the US became the world’s foremost empire, for the strongest of reasons—it held the world’s wealth. This advantage led to a period of great power and, in the latter years, as the empire began to stumble economically under its own great weight, led to the creation of organisations and legislation designed to bring in new revenue, as the old forms of revenue declined.

In recent years, we’ve seen the rise of the extraordinary assumption that “money laundering” (the practice of protecting one’s wealth from rapacious governments), should be regarded as a crime. As such, “tax havens”—those jurisdictions that provide freedom from governmental usurpation—have also been vilified as being somehow criminal because they recognize the basic right of freedom to prosper.

Along the way, we’ve witnessed the creation of the Organisation for Economic Co-operation and Development (OECD), a euphemistic appellation that might rightfully be termed the “Organization for Forced Compliance with Arbitrary Taxation Diktat by Powerful Nations.” This US-led organisation has served to periodically threaten freer nations to comply with the less free nations, so that citizens in the latter group cannot escape being stripped of the fruit of their labours.

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The Evolution Of Fiat Money (Part 3): Where Is This All Going? (Spoiler Alert – Nowhere Good!)

17-08-20 08:26:00,

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

Read Part 1 of 3 “Physical Money & The Limits Of War” here…

Read Part 2 of 3 “The Victory Of Fiat Money, Endless Wars, & The Coming Age of Subjugation” here…

Where Is This All Going?

Like any confidence game or Ponzi scheme, endless “growth” using any form of money cannot be sustained indefinitely, and the creditor / political class knows this and are preparing to unleash the inevitable crash that plunges the globe into an economic dark ages from which they shall rule absolutely and where what amenities remain shall be monopolized to themselves.  We see our expectations for the future being managed downwards, promises of opportunity replaced with visions of “safety”, individualism and self-sufficiency publically scorned as “we are all in this together”, and the inchoate beginnings of the ecological peasant religion of “Climate Change”.  Some review of the philosophical history that got us to this point will suffice.

One reason the 19th and early 20th century German state was such an implacable foe to the creditor class and their privately owned central banks was its embrace of the End of History as formulated by Georg Hegel and adopted by the Prussian state and later the German Emperors.  Hegel saw history as a progression of wars with history being the documentation of political struggles between people of different states, and people within states.  Wars and rebellions arose because people existed in states operating without what Hegel termed “objectivity, truth, and ethical life”.  Once the free and noble state emerged and, through its rightful conquest of neighboring states and assimilation of their peoples into this “objectivity, truth, and ethical life”, happiness and human fulfilment would abound, the need for conflict cease, war would no longer be waged, and the documentation of wars and struggles that Hegel defined as history would end, and so the End of History would descend as universal peace and freedom.  Thus Hegel’s version of the End of History placed all societal institutions – including central banks – subsumed to the state, and that precluded a privately owned central bank in a German Empire as this would only serve its owners. 

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The Evolution Of Fiat Money, Endless War, & The End Of Citizenship (Part 1)

16-08-20 07:34:00,

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

Part one of a two-part series.

One topic missing from historians’ analysis of the West’s transition from a physical gold and silver based money system to a fiat money system is the defining events that facilitated and enabled this transition.  One can find no detailed and critical political / historical assessment of this transition, and it would be not for lack of effort.  The transition is always presented as if it is prima facie the refined and evolved state of things that warrants no investigation other than superficial praise followed with dogmatic platitudes.  But has this transition away from the “barbarous relic” money system actually made mankind more refined and evolved, or has it instead plunged mankind into an even more heightened and efficient state of barbarism?

One encounters additional blank pages when searching for any attempt at correlating the evolution and spread of fiat money to the prevalence and severity of war.  A collective learned silence descends when attempting to identify why it is, as money evolves, that war become more ideological, destructive, widespread, and prolonged.  We are all familiar with the endless adulations describing the global spread of “democracy”, but why is it so many are unwilling converts and it became imperative to spread “democracy” via war and regime change?  And closer to home, as our own nation “evolves” from a Constitutional Republic into pure “democracy”, how is it we as “citizens” feel more and more disenfranchised rather than empowered despite even greater doses of “democracy” at home?

This essay attempts to identify the defining events that facilitated and enabled the West’s transition to a fiat based money system, examines cause and effect between the evolution of money and the prevalence and severity of war, and binds together money evolution with the history of warfare by demonstrating cause and effect between money’s evolution, the rise and necessity of endless war, and the inevitable transition from “citizens” to subjects.

Physical Money, the Limits of War, and the Ancient World

For centuries following the Dorian Invasion, the Greek peninsula in the context of contemporaneous civilizations was of minor influence.  Limited wars between city states,

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The Evolution Of Fiat Money, Endless War, & The End Of Citizenship (Part 2)

16-08-20 07:31:00,

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

Read Part 1 here…

The Victory of Fiat Money, Endless War, and the Rise of the “Citizen Soldier”

The stage was now set for the victory of fiat money after the series of bloody religious wars that plagued Europe over the 16th and 17th centuries.  For the first time some combatants would, at least initially, fight for religious “ideals” rather than pay or feudal obligation and this marks the beginning of the end of the Classical phase of European warfare.  This phase of endless war was funded by ever increasing amounts of silver borrowed on credit which, together with an endless series of tax decrees, initiated severe price inflation, economic depressions, and peasant revolts that became larger and more expensive to quell (on credit).  With both political and economic chaos spreading across Europe, it was at this time its intelligentsia began to espouse the “Universal Rights of Man” which, for its time, was nothing short of extreme radicalism as it demanded an end to the centuries old divine rights of the sovereign over his increasingly taxed subjects.

These tenets of the “Universal Rights of Man” were quickly adopted and championed by the Bourgeoisie / Burghers / Borghese, skilled craftsmen, and lesser nobility as a means to not only elevate their social status, but also to break free from their centuries old and ever increasing taxation and military funding obligations to the sovereign.  The Reformation and subsequent religious wars proved that rebellion could, albeit at an extreme loss of (peasant) life, extricate a people from its taxation obligation to the Papal Empire.  By the latter half of the 18th century, simmering peasant rebellions began to flare into outright revolution as the “Social Contract” between the sovereign and subject disintegrated, prices for basic necessities skyrocketed due to the increasing taxation and coin debasement needed to fund wars and extreme opulence.  Sovereign default became state policy as by sovereign right, and the creditor class began to suffer heavy losses as the wars had no effect other than spawn new wars and drive the state further into debt, upon which it would eventually default, all while the state court played parlor games and gambled (on credit).

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Brazil’s Money Laundering Scandal from Hell – Global Research

06-08-20 01:40:00,

Two decades after a political earthquake, a powerful aftershock that should be rocking Brazil apart is being met with thunderous silence.  

What is now termed “the Banestado leaks” and “CC5gate” is straight out of vintage WikiLeaks: a list, published for the first time in full, naming names and detailing one of the biggest corruption and money laundering cases in the world in the past three decades.

This scandal allows for the healthy practice of what Michel Foucault characterized as the archeology of knowledge. Without understanding these leaks, it’s impossible to place in proper context events ranging from the sophisticated assault by Washington on Brazil – initially via NSA spying on President Dilma Roussef’s first term (2010-2014) – all the way to the “Car Wash” corruption investigation that jailed Luis Inácio Lula da Silva and opened the way for the election of neofascist patsy Jair Bolsonaro as president.

Credit for the scoop on this George Orwell-does-hybrid-war plotline is due, once again, to independent media. The small website Duplo Expresso, led by young, daring, Bern-based international lawyer Romulus Maya, first published the list.

An epic five-hour podcast assembled the three key protagonists who denounced the scandal in the first place, back in the late 1990s, and now are able to re-analyze it: then-governor of Parana state Roberto Requiao, federal prosecutor Celso Tres and now retired police superintendent Jose Castilho Neto.

Previously, in another podcast, Maya and anthropologist Piero Leirner, Brazil’s foremost analyst of hybrid war, briefed me on the myriad political intricacies of the leaks while we discussed geopolitics in the Global South.

The CC5 lists are herehere , and here . Let’s see what makes them so special.

The mechanism 

Way back in 1969, the Brazilian Central Bank created what was described as a “CC5 account” to facilitate foreign companies and executives to legally wire assets overseas. For many years the cash flow in these accounts was not significant. Then everything changed in the 1990s – with the emergence of a massive, complex criminal racket centered on money laundering.

The original Banestado investigation started in 1997. Federal prosecutor Celso Tres was stunned to find that from 1991 to 1996 Brazilian currency worth no less than US$124 billion had been wired overseas.

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