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Why did’nt certain things happen yet…….

Russia Prepares Mega-Deal With India After Locking Up China With “Holy Grail” Gas Deal

Welcome to the Currency War, Part 14: Russia, China, India Bypass th
Published : March 26th, 2014

As it tries to punish Russia for the latter’s dismemberment of Ukraine, the West is discovering that the balance of power isn’t what it used to be. Russia is a huge supplier of oil and gas — traded in US dollars — which gives it both leverage over near-term energy flows and, far more ominous for the US, the ability to threaten the dollar’s rein as the world’s reserve currency. And it’s taking some big, active steps towards that goal. As Zero Hedge noted on Tuesday:

Russia Prepares Mega-Deal With India After Locking Up China With “Holy Grail” Gas Deal

Last week we reported that while the West was busy alienating Russia in every diplomatic way possible, without of course exposing its crushing overreliance on Russian energy exports to keep European industries alive, Russia was just as busy cementing its ties with China, in this case courtesy of Europe’s most important company, Gazprom, which is preparing to announce the completion of a “holy grail” natural gas supply deal to Beijing. We also noted the following: “And as if pushing Russia into the warm embrace of the world’s most populous nation was not enough, there is also the second most populated country in the world, India.” Today we learn just how prescient this particular comment also was, when Reuters reported that Rosneft, the world’s top listed oil producer by output, may join forces with Indian state-run Oil and Natural Gas Corp to supply oil to India over the long term, the Russian state-controlled company said on Tuesday.

Rosneft CEO Igor Sechin, an ally of President Vladimir Putin, travelled to India on Sunday, part of a wider Asian trip to shore up ties with eastern allies at a time when Moscow is being shunned by the West over its annexation of Crimea. Rosneft said it had also agreed with ONGC they may join forces in Rosneft’s yet-to-be built liquefied natural gas plant in the far east of Russia to the benefit of Indian consumers.

We just have one question: will payment for crude and LNG be made in Rubles or Rupees? Or in gold. Because it certainly won’t be in dollars.

Rosneft, which is increasing oil flows to Asia to diversify away from Europe, did not provide any additional details but said it had discussed potential cooperation with Reliance Industries and Indian Oil.

It did not have to: it is quite clear what is going on. While the US is bumbling every possible foreign policy move in Ukraine (and how could it not with John Kerry at the helm), and certainly in the middle east, where it is alienating Israel and Saudi just to get closer to Iran, Russia is aggressively cementing the next, biggest (certainly in terms of population and natural resources), and most important New Normal geopolitical Eurasian axis: China – Russia – India.

There is only one country missing – Germany. Because while diplomatically Germany is ideologically as close to the US as can be, its economy is far more reliant on China and Russia, something the two nations realize all too well. The second the German industrialists make it clear they are shifting their allegiance to the Eurasian Axis and away from the Group of 6 (ex Germany) most insolvent countries in the world, that will be the moment the days of the current reserve petrocurrency will be numbered.

To understand why trade deals between Russia, China and India are potentially huge, a little history is useful: Back in the 1970s, the US cut a deal with Saudi Arabia — at the time the world’s biggest oil producer — calling for the US to prop up the kingdom’s corrupt monarchy in return for a Saudi pledge that it would accept only dollars in return for oil. The “petrodollar” became the currency in which oil and most other goods were traded internationally, requiring every central bank and major corporation to hold a lot of dollars and cementing the greenback’s status as the world’s reserve currency. This in turn has allowed the US to build a global military empire, a cradle-to-grave entitlement system, and a credit-based consumer culture, without having to worry about where to find the funds. We just borrow from a world voracious for dollars.

But if Russia, China and India decide to start trading oil in their own currencies — or, as Zero Hedge speculates, in gold — then the petrodollar becomes just one of several major currencies. Central banks and trading firms that now hold 60% of their reserves in dollar-denominated bonds would have to rebalance by converting dollars to those other currencies. Trillions of dollars would be dumped on the global market in a very short time, which would lower the dollar’s foreign exchange value in a disruptive rather than advantageous way, raise domestic US interest rates and make it vastly harder for us to bully the rest of the world economically or militarily.

For Russia, China and India this looks like a win/win. Their own currencies gain prestige, giving their governments more political and military muscle. The US, their nemesis in the Great Game, is diminished. And the gold and silver they’ve vacuumed up in recent years rise in value more than enough to offset their depreciating Treasury bonds.

The West seems not to have grasped just how vulnerable it was when it got involved in this latest backyard squabble. But it may be about to find out.

Markets hold breath as China’s shadow banking grinds to a halt

 

Ambrose Evans-Pritchard

By

7:47PM GMT 10 Mar 2014

Fresh loans in China’s shadow banking system evaporated to almost nothing from   $160bn in January

A slew of shockingly weak data from China and Japan has led to a sharp   sell-off in Asian stock markets and the biggest one-day crash in iron ore   prices since the Lehman crisis, calling into question the strength of the   global recovery. 

The Shanghai Composite index of stocks fell below the key level of 2,000 after   investors reacted with shock to an 18pc slump in Chinese exports in February   and to signs that credit is wilting again. Iron ore fell 8.3pc. 

Fresh loans in China’s shadow banking system evaporated to almost nothing from   $160bn in January, suggesting the clampdown on the $8 trillion sector is   biting hard. 

“It seems that rising default risk has started to erode Chinese investors’    confidence,” said Wei Yao, from Societe Generale. “Together with continued   regulatory tightening on banks’ off-balance-sheet activity, we are certain   this slowing credit trend has further to go and will inflict real pain on   the economy.”

Japan’s economy is losing steam as the monetary stimulus from “Abenomics”    wears off and the country braces itself for a rise in the consumption tax   from 5pc to 8pc. Economic growth slumped from 4pc in early 2013 to 0.7pc in   the fourth quarter, while the country racked up a record trade deficit.

The Economy Watchers Survey saw the steepest drop last month since the March   2011 tsunami and is now lower than when Abenomics began. Marcel Thieliant,   from Capital Economics, said Japan faces a “sharp slowdown”. 

The renewed jitters in China come after the authorities allowed solar company   Chaori to default last week, the first ever failure in the country’s   domestic bond market. The episode is a litmus test of President Xi Jinping’s   new regime of market discipline, though the central bank has been careful to   cushion the blow by engineering a fall in interbank interest rates. “Such   adjustments are necessary for China in the long run, but are nothing if not   risky in the short term,” said Ms Wei. 

It is extremely hard to calibrate a soft landing of this kind, and the sheer   scale of China’s credit boom now makes it a global headache. China accounts   for half of all the $30 trillion increase in world debt over the past five   years. 

Zhiwei Zhang, from Nomura, said the central bank will be forced to loosen   monetary policy this year with repeated cuts in the reserve asset ratio to   head off a deeper slowdown. 

Nomura said China’s $23bn trade deficit in February masks capital outflows,   while data was in any case distorted by the Chinese New Year. 

Even so, there are signs that deflationary forces are taking hold in China.   Producer prices (PPI) fell by 2pc in February from a year earlier. Haibin   Zhu, from JP Morgan, said it is “disturbing” the PPI index has been negative   since November, a sign that China is struggling to cope with excess   manufacturing plant. 

China invested $5 trillion last year, as much as the US and Europe combined.   There are already signs that the country is trying to export its   over-capacity overseas by pushing down the yuan. If this amounts to a   competitive devaluation policy, it risks sending a fresh deflationary   impulse across the globe.

http://www.telegraph.co.uk/finance/china-business/10688667/Markets-hold-breath-as-Chinas-shadow-banking-grinds-to-a-halt.html

The New Exchange Rate System

M1 Money Supply and Inflation

By JC Collins

Dong to Dollar

Purchasing Power Parity and Arbitrage are two terms that everyone should make themselves aware off as the world’s economy moves closer toward a centralized SDR trade system through the International Monetary Fund with accounts balanced by the Bank for International Settlements.

Purchasing Power Parity is the balance between exchange rates when there is also balance in the domestic purchasing power of the currencies.

 

Arbitrage is taking advantage of the price imbalances between markets and profiting from the market differentials.

Arbitrage cannot exist alongside Purchasing Power Parity.

M1 money supply refers to physical currency as well as checking account deposits.

For your reference, M2 money is M1 money plus savings accounts and money market accounts.

And M3 money is M2 money plus large deposits and other long term large deposits, such as larger liquid assets as well as short term repurchase agreements.

Keep these terms in mind as we further define the structure and mechanisms of the emerging multilateral system.

As an extension to the SDR’s and the New Bretton Woods series, let us discuss a much talked about and confusing aspect of the system.  When the currencies of the world are released from their peg to the dollar and pegged to the SDR supra-sovereign currency which we have been reviewing, there will in fact be a new exchange rate structure.

What this structure will be has not yet been made available to the general population.  All the talk of specific exchange rates and timing of release of the rates are not founded in facts or accurate information.

And on the flip side of that there are those who are stating that a Global Currency Reset is a conspiracy theory.  To these people those that proclaim such a future “event” apparently do not understand the micro and macro of economic fundamentals or how exchange rates and money supply truly work.

Their argument appears very logical on the surface.  As a country increases its money supply through debt creation and currency printing, the value of that currency decreases.  More money in circulation means more devaluation of that currency, basic supply and demand principles.  So how can a currency revalue upward when there is so much of it in circulation?  Makes sense right?  Wrong.

If the key performance indicators (KPI) of any countries M1 money supply were that elementary, then we would live in a much simpler world.  We can make many examples of why this isn’t the case but none is more obvious than that of the U.S. dollar itself.

If more money in circulation meant a decrease in the value of that currency on the exchange rate market, then the dollar would be almost worthless today, much like the dong and other currencies.  More U.S. debt (money creation) has been added in the last 6 years than the entire history of the U.S. itself, from George Washington to George W. Bush.  Yet the dollar’s exchange rate has maintained itself within a small range of fluctuation.  The reason that the dollar has maintained this exchange rate over the years tells us that there are other KPI’s which need to be factored into the equation when measuring a countries exchange rate and inflation level, outside of direct manipulation of course.

Some of these indirect KPI’s are imports and exports.   And there is no direct relationship between M1 money supply increases and inflation.

Final_Shifted_M1_and_CPI

Since 1944 the U.S. dollar has been the reserve currency which means that international trade imbalances have been settled in dollars.  This forced other countries of the world to hold dollars which allowed the U.S. to export the majority of its inflation.

As the U.S. printed more money, expanding its M1 money supply, the inflation which should have settled domestically was in fact exported to the very same markets that were forced to hold a reserve of U.S. dollars in order to balance their trade accounts.

As we reviewed in “Why the Vietnamese Dong Will Reset”, the State Bank of Vietnam was indirectly forced into devaluing their currency in order to attract trade and also be a dumping ground for U.S. inflation as the Vietnamese people used the dollar instead of the dong in their everyday lives.

As the new centralized system of SDR allocation emerges between now and 2018 we will see less U.S. dollars in the foreign reserves of other countries.  As an example, in the last 5 years Vietnam has decreased their dollar holdings by almost 50% and at the same time have increased their gold holdings dramatically.  Interestingly enough, their SDR holdings also increased by a factor of more than 400%.

The question of what Vietnam will do with the trillions of dong that are now in circulation is a legitimate question.  When the exchange rate of the dong adjusts to reflect the economic reality within the country, these trillions of dong cannot be in circulation, as it would create an M1 money supply that is disproportionate to the actual economic weights used for the SDR composition.

Therein lays the solution to the problem.

Keeping with our pattern theme of transitions from micro to macro states, we start with the process of the dollar, the world’s reserve currency, being printed and exported to the central banks of the world to facilitate trade.  The inflation and exchange rate decreases that would be logically associated with this increase in the M1 money supply is hidden or sunk into the markets of the emerging economies.

As the world shifts towards the SDR system we will see a similar process unfold.  In essence, Vietnam will export their inflation (current M1 money supply) into the SDR bond system just like the United States has been exporting its inflation into emerging markets and countries like Vietnam through trade imbalances.  What we will see is Vietnam slowly begin to buy back the dong in circulation and re-capitalize it through the SDR bonds.

Once a predetermined level has been achieved the rest of the dong M1 money supply will remain in circulation and be pegged to the multilateral SDR and not the U.S. dollar.  In fact we are beginning to see this process unfold already in the numbers we presented above.  This slow trickle will eventually become a stampede out of dollars and into SDR’s.  It will be the same for every country.

The U.S. debt will also be rolled into SDR’s and factor into the overall economic weight of that country’s SDR composition.  This is where the substitution account we referenced in Part 6 of the SDR series becomes invaluable.  This substitution account will act as a transition market for dollars to SDR’s to ensure that current holders of U.S. debt do not see that asset value decrease dramatically as the system shifts.  China will utilize this substitution account just as much as the United States Treasury and Federal Reserve.

China will not be dumping dollars.  They will transition the dollar debt which they hold into SDR’s through this substitution account.  The one aspect that is holding the process up right now in the American Congress (2010 Code of Reforms) is how this dollar to SDR transition will factor into China’s overall SDR composition for the renminbi.

This is one of the hardest aspects of this new system to understand, which is why it is still being negotiated.  It would do us well to spend more time in the future exploring the different angles involved in the Great Consolidation aspect of the Global Currency Reset.  One cannot exist without the other.  It has been intentionally designed this way.

Most don’t know this, but the Syrian pound is already pegged to the SDR, and has been for about 5 years.  One can only speculate if this has something to do with the civil war in the country.

What some analysts don’t factor into their equations is how much the economic system of the world will change, and is changing, as we move towards the multilateral monetary system with all the currencies of the world pegged to the SDR.  For those who doubt the reality of this new system, the volume of information that has been available and is coming available would seem to prove its existence.

The new system will create Purchasing Power Parity and at the same time eliminate Arbitrage.  Arbitrage is one of the economic weapons that the small rent seeking elite use to transfer wealth from the larger disorganized masses.  The M1 money supply will most likely also be redesigned to more accurately measure the weights of the new SDR system.     – JC Collins

Click the link to see all great comments:

http://philosophyofmetrics.com/2014/02/19/the-new-exchange-rate-system/#more-209

China Sold Second-Largest Amount Ever Of US Treasurys In December: And Guess Who Comes To The Rescue

 

Submitted by Tyler
Durden
on 02/18/2014 20:15 -0500

While we will have more to say about the disastrous December TIC data shortly, which was released early today, and which showed a dramatic plunge in foreign purchases of US securities in December – the month when the S&P soared to all time highs and when everyone was panicking about the 3% barrier in the 10 Year being breached and resulting in a selloff in Tsy paper – one thing stands out. The chart below shows holdings of Chinese Treasurys (pending revision of course, as the Treasury department is quite fond of ajdusting this data series with annual regularity): in a nutshell, Chinese Treasury holdings plunged by the most in two years, after China offloaded some $48 billion in paper, bringing its total to only $1268.9 billion, down from $1316.7 billion, and back to a level last seen in March 2013! 

This was the second largest dump by China in history with the sole exception of December 2011.

That this happened at a time when Chinese FX reserves soared to all time highs, and when China had gobs of spare cash lying around and not investing in US paper should be quite troubling to anyone who follows the nuanced game theory between the US and its largest external creditor, and the signals China sends to the world when it comes to its confidence in the US.

Yet what was truly surprising is that despite the plunge in Chinese holdings, and Japanese holdings which also dropped by $4 billion in December, is that total foreign holdings of US Treasurys increased in December, from $5716.9 billion to 5794.9 billion.

Why? Because of this country. Guess which one it is without looking at legend. 

That’s right: at a time when America’s two largest foreign creditors, China and Japan, went on a buyers strike, the entity that came to the US rescue was Belgium, which as most know is simply another name for… Europe: the continent that has just a modest amount of its own excess debt to worry about. One wonders what favors were (and are) being exchanged behind the scenes in order to preserve the semblance that “all is well”?

Click here for graphs/pictures:

http://www.zerohedge.com/news/2014-02-18/china-sells-second-largest-amount-us-treasurys-december-and-guess-who-comes-rescue

 

SDR Supplemental: VND or VNN? IQD or IQN?

February 9, 2014 5 Comments

 

Applying Logic to Currency Sustainability

By JC Collins

Monetary_Museum

The world is willing to restructure the monetary system through the International Monetary Fund but has plans in place to by-pass the western dominated institution if the U.S. Congress does not pass the 2010 Code of Reforms.

China and other BRICS countries are calling for a new monetary system to be implemented through the I.M.F. but are also developing a workaround so that the world economy does not completely collapse when the U.S. dollar finally hits the point of hyperinflation.

 

Officials with The People’s Bank of China and the Chinese government itself have repeatedly called for expanded use of the SDR system through the I.M.F.  As I’ve stated before, this is the preferable path forward with the least amount of disruption to the world economy.  Contrary to what many American’s may think, this path will also cause the least amount of disruption for their lives as well.

The alternative will lead to further economic warfare and the threat of social collapse.

When analysing patterns one looks for commonality, redundancy, and single points of origin.  When applying logic to the Global Currency Reset and Great Consolidation, we find a single point of origin in the I.M.F. 2010 Code of Reforms which are being held for ransom in the United States Congress.

There is high probability that the ransom situation is a part of the Hegelian Dialectic Triad and will eventually be passed when the timing is right.

The purpose of this post is not to repeat what I’ve said in previous posts but to build on one specific point.  I have received many questions in regards to the currencies of Vietnam and Iraq, being the VND and IQD.  The questions have pertained to the so called replacement currencies which are being referred to as VNN and IQN.

I have heard nothing of such ticker names but would like to put forth the following theory.  Let’s suppose that the ticker symbols VNN and IQN were indeed leaked out from certain sources. Now let’s assume that these “new” currencies will replace the old currencies.  The only way that will happen is if the old currencies, the VND and IQD, will be demonetized and taken out of circulation.  And I would reason that the only way these currencies would be demonetized is if Congress did not eventually pass the I.M.F. 2010 Code of Reforms.  This would force the world to activate its plan to work around the I.M.F. and the U.S. dollar.

Said in plain straight talk, if Congress does not finally pass legislation to support the 2010 Reforms and restructure the I.M.F. Executive Board, than the rest of the world will deflate away as much of their sovereign debt as possible and then demonetize their currencies, let’s say the VND and IQD in this case, and issue new currencies which will not be pegged to the dollar.  These currencies in theory could be the VNN and IQN.

Holders of VND and IQD will make very little if the currencies are demonetized.

The world is putting much pressure on the U.S. Congress right now to pass the Reforms.  Iran is pushing naval forces into the Atlantic almost to the American maritime borders.  While Chinese naval forces are pushing further into the Pacific and closing in from the other side.

Many of you are following the banker “suicides” and gold market and currency market manipulation.  These are clear signs of changes on the horizon.  If the Reforms are passed than the manipulation will act as the catalyst for currency revaluation and sustainability.  If the Reforms are not passed, than we will watch all the currencies collapse and sovereign debt will continue to eat away at our everyday lives.

Just today protestors in Bosnia burned down the presidential palace.  This is exactly what we have predicted here at philosophyofmetrics.com.  Continued problem/reaction/solution dynamics.  It’s going to be a long year of fluctuating currencies and sovereign debt default threats.  But I predict that before it’s over the U.S. Congress will in fact pass the Reforms and will begrudgingly retreat from its dominant role in world affairs, just as the British before it.

Let’s see what will fill the vacuum this time.   – JC Collins

http://philosophyofmetrics.com/2014/02/09/sdr-supplemental-vnd-or-vnn-iqd-or-iqn/#more-163

SDR’s and the New Bretton Woods – Part One

Some real heavy duty writings from this writer, JC Collins.  Link to part 2 in the bottom.

 

BRICS Inject Capital into I.M.F. Basket of Currencies

Jan 21, 2014

By JC Collins

In my previous post I briefly explained how China was in the process of assuming the liabilities of the Federal Reserve, in addition to their already held liabilities of the U.S. Treasury.  Such a strong statement will require even stronger evidence.  This I will attempt to achieve over this multi-part essay. 

one-world-currency

“The legislative process is underway right now. We want the reforms to be adopted expeditiously. It’s really the U.S. Treasury, Jack Lew and his team that’s taking the lead on getting these measures through the U.S. Congress that are required to implement the 2010 reforms.”

“Just to remind you what those are, the 2010 reforms do a couple things. One, they bring four dynamic emerging market countries into the top 10 shareholder ranks or what we call quota ranks of the institution. China, Brazil, Russia, India. It also doubles our permanent capital, the quota. And it also creates a fully elected Executive Board.” 

                          – William Murray, I.M.F. Deputy Spokesman, Jan 9, 2014.

“The IMF is explicit in its antidemocratic leanings, what it calls “political considerations”.  The SDR blueprint calls for the appointment of “an advisory board of eminent experts” to provide direction on the amount of money printing in the new SDR system.  Perhaps these “eminent experts” would be selected from among the same economists and central bankers who led the international monetary system to the brink of destruction in 2008.”

                                   – James Rickards, Currency Wars, Penguin Group, 2011

 _______________________________________________________________________________

G. Edward Griffin’s mind altering “The Creature from Jekyll Island” introduced many of us to the somewhat hidden history of the U.S. Federal Reserve.  It told of how the Federal Reserve Act was passed in Congress during the Christmas break in the year 1913.  It was insidious.  And it changed the course of human history, as it planted the seed of what would slowly grow to become the world’s reserve currency.

 

Though the U.S. dollar didn’t become the official reserve currency until the Bretton Woods Agreement of 1944, it is commonly accepted that the dollar had already usurped the British pound of this title well before it was officially acknowledged. As I believe the U.S. dollar has now already been usurped by another.  We’ll get back to that in a while.

There was another event which took place in the year 1913 which has been little understood or known at all in the western world today.  After the collapse of the Manchu Dynasty in 1911, the remaining Government of the Chinese Republic issued bonds to foreign investors for the purpose of raising capital to rebuild the country.  These bonds were titled the 1913 Chinese Government 5% Reorganization Gold Loan.  Emphasis on the word gold for later reference.

These bonds were pegged to the price of gold as a hedge against future inflation and were denominated in four currencies.  The underwriting banks for the bonds reflect the four currencies which the bonds were interchangeable with at the time, which are now known as HSBC, Deutsche Bank, the Bank of Tokyo-Mitsubishi UFJ, and Caylon – Credit Agricole Corporate and Investment Bank.

Keep in mind that these bonds were issued in the same context as the U.S. Treasury Bonds which the world’s central banks have been gobbling up since 1944. These bonds had a yield.  These bonds have never fully been acknowledged by the Chinese government.  As a part of the deal with the British government for the return of Hong Kong, the People’s Republic of China did honor 10% of the outstanding bonds at about 62% of the face value.  And what I can say at this time is that there is in fact a deal in the works for a final payout on the remaining bonds.  We’ll get back to that in a while.

10323072_1

In 1944, as a part of the Bretton Woods system, the International Monetary Fund and the World Bank were created.  These were western dominated institutions whose sole purpose was organizing foreign markets for the acceptance of U.S. dollars.  We will leave the full explanation of these institutions and their role in structuring our current debt based system for another essay series, but for our purposes here, it’s important to understand that they propagated the exporting of dollar inflation to what we now call the “emerging markets”, or the BRICS countries.

Since the initial printing of the Federal Reserve Note (U.S. dollar) in 1913, the “dollar” has lost 95% of its value.  We see this devaluation of the dollar as inflation, or the increase of costs for items we buy.  This devaluation of the dollar has had a few milestones.  One is after the Bretton Woods Agreement when the dollar became the primary reserve currency of the world.  The second came when President Richard Nixon uncoupled the dollar from its peg with gold.  This was in 1971.  A third milestone can be argued to be in 1973, when the so called “petrodollar” was created with agreements between the U.S. and Saudi Arabia, and later all the OPEC countries.  This “petrodollar” scheme ensured that all oil trades were completed internationally in U.S. dollars.  This was a slight-of-hand from the Bretton Woods arrangement to the “petrodollar” arrangement.

A fourth milestone was obviously the onset of Quantitative Easing after the financial crisis of 2008.  The chart below clearly shows how with each milestone the amount of debt (money printing) by the U.S. Treasury and Federal Reserve tag team has been multiplied dramatically leading to inflation.  This is shown by an increase in the red line, which represents CPI – Consumer Price Index, the amount you pay for stuff.

20131212_Fed1

The only end to this pattern is an end to the dollar as the world’s primary reserve currency.  Just like the British pound before it.  In the chart below you’ll notice the same gradual downward pattern as the U.S. dollar.

BritishPound1791-2004NOTES

The central banks of the world were buying up U.S. treasuries before the British even accepted that there was a problem with the pound.  The same is happening today with the dollar.  In fact, most of the world outside the United States has already accepted the demise of the dollar as fact.  But the idea is unfathomable to the average American.

The International Monetary Fund issues a currency called SDR – Special Drawing Rights.  The SDR’s are valued on a basket of currencies.  In essence, it’s a true to life multiply reserve currency system.  It has been slowly built up since the early 1970’s, at the same time the U.S. dollar started its serious devaluation.  Could the plan have been in place since 1971 to end the dollar system through hyperinflation before implementing the SDR as a true world currency?  Perhaps.

On January 9, 2014, I.M.F. Deputy Spokesman William Murray was giving a press briefing.  With zero coverage of this briefing in the western media, it’s important to relay what happened when the questioned was asked about the implementation of the 2010 Code of Reforms, or Governance Reforms.  Mr. Murray answered by stating:

“The legislative process is underway right now. We want the reforms to be adopted expeditiously. It’s really the U.S. Treasury, Jack Lew and his team that’s taking the lead on getting these measures through the U.S. Congress that are required to implement the 2010 reforms.”

It seems both the U.S. Treasury and the I.M.F. are very anxious about these reforms.  So what are they?

“Just to remind you what those are, the 2010 reforms do a couple things. One, they bring four dynamic emerging market countries into the top 10 shareholder ranks or what we call quota ranks of the institution. China, Brazil, Russia, India. It also doubles our permanent capital, the quota. And it also creates a fully elected Executive Board.” 

This tells us a few important things.  One, the influence of the BRICS countries within the structure of the I.M.F. is going to be greatly expanded.  As stated, they will be in the top 10 shareholder ranks.  These are positions previously dominated by western financial and U.S. dollar interests.  The gravity of this statement cannot be understated.

Second, it’s telling us that the BRICS countries are bringing capital with them.  Enough capital in fact, to double what the I.M.F. presently holds on reserve.  The BRICS countries will be injecting a huge amount of capital into the SDR system.  One only has to research the amount of gold being exported to the BRICS countries, especially China, to understand where this capital, or worth, will come from.  We’ll get back to that in a while.

Thirdly, expanding the influence of the BRICS countries within the structure of the I.M.F. also “creates a fully elected Executive Board”.  The Executive Board of the I.M.F. is responsible for SDR allocation.  Let that sink in for a moment.  The BRICS countries are going to have an equal say on SDR allocation.  The SDR is being built up as the world’s reserve currency.  The value of the SDR will be based on a basket of currencies.  And the U.S. Treasury is pushing congress to make this happen.

On August 5, 2013, the Peoples Bank of China called for a “New Bretton Woods” system where the U.S. dollar would be removed as the world’s primary reserve currency.  It also called for an expanded usage of the SDR and for the new system to be supported by gold.

In Part Two, we will explore how the U.S. debt, being the liabilities of both the Treasury and the Federal Reserve, will be consolidated with the treasury bonds held by China and rolled into the new SDR system.        – JC Collins

Continue to SDR’s and the New Bretton Woods – Part Two

http://philosophyofmetrics.com/2014/01/21/sdrs-and-the-new-bretton-woods-part-one/

America’s Karma and World War Two Gold Theft

 

source:  http://philosophyofmetrics.com/2014/01/30/americas-karma-and-world-war-two-gold-theft/

And the Gold Recovery Attempts of the Korean and Vietnam Wars

Jan 30, 2014

By JC Collins

Missouri_Fires_16inch_Broadside!

This essay serves as an Addendum to one of my previous posts titled “China to Purchase the Federal Reserve”.  The article itself has generated a lot of interest and many questions.  Such things are not easy to prove and take book length discourses to fully understand and grasp the complexity of not just the process, but also the history behind it.  Such are the expectations of pivotal events.

Let’s back track 100 years to 1913 and the creation of the Federal Reserve.  The Fed was set up as the central bank of the United States.  It has a 100 year mandate (there are questions about extensions) and quickly went to work printing money and building up the American war machine for World War One which began the very next year.

 

The hidden purpose of World War One was the take down of one of the two last monarchies in Europe.  The Austro-Hungarian Empire was a “dual monarchy” created in 1867 as an agreement between Hungary and Austria for the purpose of defense against the onslaught of revolutions initiated by banking powers.  These revolutions started with the French Revolution as a means to overthrow Europe’s monarchy’s and plant the design of the modern state in the minds of the people.  The form of government and banking systems that spewed forth from this injustice slowly crawled from country to country, digging its roots into the industries and cultures of the conquered lands.

The second monarchy was Russia.  Also by design, the bankers created dismal economic conditions within Russia which in turn, through propaganda, was blamed on the Romanov royal family.  This, as we know, led to the Bolshevik Revolution and the installation of the synthesis to democracies thesis, communism.  See my previous post for a brief explanation on the usage of the Hegelian Dialectic.

The bankers quickly went to work in Austria on a plan to economically destroy Germany and build it back up as the Third Reich.  Similar patterns were unfolding in Asia with the rise of Imperial Japan.

World War Two officially began in September of 1939.  Like World War One, there was a hidden purpose.  This time it was the theft of gold held in both Europe and Asia.  The lands conquered by both armies were stripped of their gold reserves which were then sent back to the vaults of the western banks.  Most of this gold eventually ended up in Fort Knox as both official and unofficial gold deposits of the Federal Reserve System.  There is plenty of information available on Nazi Gold to satisfy the inquisitive mind so I will not elaborate here.

Gold Storage

Once the gold hoards were shipped west, America finally became embroiled in the war to help clean up the debris left over from the bankers gold theft.  This afforded the bankers another opportunity to earn great returns as they funded both sides of the war and literally made a killing.

But the Japanese did something unexpected.  They hid some of the gold in the tunnels and caves of the lands they conquered in Asia.  The bankers quickly caught on to this scam riding under their scam and became furious enough to drop two atomic bombs on Japan.  Fat Man and Little Boy aside, the bankers never got the gold and it was quietly moved into other locations.  Most likely it never stayed in one place for too long.

Not to be deterred, the bankers continued to build up their war machine into the American military industrial complex and set it loose upon Korea and eventually Vietnam in search of the Yamashita Gold.

There are many reasons why the bankers wanted this gold.  Traditionally gold moves towards regions that manufacture and the western world was modernizing with manufacturing as the driving force.  In order for manufacturing to continue increasing, it needed funding.  Funding came from the debt creation system that put money into circulation.  In order to print more debt, somebody needed to hold it.  The U.S. could not hold all the debt within the country because it would cause too much inflation.  As such, inflation needed to be exported to countries with markets which had been “engineered” specifically to import that inflation.  Obviously the people of these countries suffered the inflation through poor living standards and working conditions.

Note:  This is exactly what has been happening and will continue to happen in America as manufacturing has fled its shores too cheaper markets.  The gold soon followed and the living and working conditions have been getting poorer and poorer for the majority of average Americans.  This is the karma which is being exacted upon America for endless war and debauchery.

vietnam-war-rare-incredible-pictures-history

The history of our world and its wars is the history of the movement of gold.  From ancient Babylon to today, gold is the backbone of development and economic security.  Anything you hear different is simply propaganda spewing forth from the feces spigots of television sellouts who are milking an almost empty system before discarding the carcass upon the heap of history.

Gold is on the move once again.  In a big way.  Much of it going to the Chinese government and the People’s Bank of China.  Things have increased even more dramatically in the last few weeks as the Shanghai Gold Exchange has had 159 tons of gold withdrawn since January 1st. The JP Morgan gold vault has seen 44% of its inventories depleted just in the last 4 days.  Let’s not forget that the JP Morgan vault is now owned by China. Where is this gold going?

China has been setting up gold vaults throughout Asia. Vaults will not sit empty for long.

The new economic system being slowly implemented through the I.M.F. with the support of China is paying greater attention to the geographical locations of central bank gold vaults.  These locations will be in the ASEAN members as well as mainland China.  Some of the countries importing gold into central bank vaults are Vietnam, the Philippines, Singapore, Thailand, and Indonesia.

The gold which was stolen is being returned.  It took a world war to get the gold but there will be no war to get it back.  It’s already moving.  This deserves repeating, there will be no major war over this gold movement.

In the near future the Comox will no longer price gold as the Shanghai Gold Exchange will set the fixed rates along with the I.M.F. SDR framework agreements. Gold trade settlements will be structured in SDR’s but managed through the Shanghai Free Trade Zone.  From there we drop another level to the RCEP, or Regional Comprehensive Economic Partnership, comprised of the ASEAN members as well as Japan (no war with China), South Korea, Australia, New Zealand, and India.

In a future essay I will be focusing on the re-emergence of Vietnam into the global economy.  But for now I’d like to bring notice to the fact that their economic growth is astounding with a middle class that is swelling and an economy that is attracting huge investment.  Vietnam has the lowest unemployment rate on the planet. Samsung is moving its factories into Vietnam.  Russia has signed an agreement with Vietnam to build a $28 Billion oil refinery, the second largest in all of Asia, with more to come.  Even Starbucks is getting into the Vietnam craze.

Hanoi vietnam city

The Vietnamese people hold 300 to 400 tonnes of personal gold.  That is equal to or greater than the gold holdings of Great Britain. The State Bank of Vietnam is planning on converting this gold into dong deposits with the intent of strengthening the currency.  Add this to the gold that will be imported into the vaults of the central bank through the Shanghai Gold Exchange, and you have the makings of a very strong regional power.  I would suspect that Vietnam will become a contributing member too the BRICS Development Bank and the SDR compositions for the region.

A long way Vietnam has come from the American military onslaught and attempted Yamashita gold theft.  It’s almost fitting that the small country and its people which were bombed and killed by the Federal Reserve military machine will now be the partial holder of the official gold that once sat within the hollowed walls of the now empty Fort Knox.

Could this be the ultimate triumph of Confucianism over Platonism? The shame of the Asian Confucian cultures once subjected to the western idealism of Plato. And now the guilt that the west must feel as the karma is balanced.

And now the Federal Reserve System is almost dead, as the Chinese pick at the bones of what was once their tormentor.  The new Federal Reserve will issue the U.S. foreign bonds in the form of SDR compositions.  These bonds will be for international use only.  The Trans Pacific Partnership will be the pipeline for these international SDR’s as they are spewed forth from the Federal Reserve.  The allocation will be structured around the SDR basket compositions as I’m detailing in “SDR’s and the New Bretton Woods”.

The internal U.S. dollar will be issued through the Treasury.  Guess who will purchase these bonds?  If you guessed your pension fund, then you’re on the right track.  The timing of the MyRA announcement was not coincidental.  Nothing is.  – JC

http://philosophyofmetrics.com/2014/01/30/americas-karma-and-world-war-two-gold-theft/

go read some other articles on that site, good stuff.

On The 100th Anniversary Of The Federal Reserve Here Are 100 Reasons To Shut It Down Forever

Submitted by Michael Snyder of The Economic Collapse blog,

December 23rd, 1913 is a date which will live in infamy.  That was the day when the Federal Reserve Act was pushed through Congress.  Many members of Congress were absent that day, and the general public was distracted with holiday preparations.  Now we have reached the 100th anniversary of the Federal Reserve, and most Americans still don’t know what it actually is or how it functions.  But understanding the Federal Reserve is absolutely critical, because the Fed is at the very heart of our economic problems.  Since the Federal Reserve was created, there have been 18 recessions or depressions, the value of the U.S. dollar has declined by 98 percent, and the U.S. national debt has gotten more than 5000 times larger.  This insidious debt-based financial system has literally made debt slaves out of all of us, and it is systematically destroying the bright future that our children and our grandchildren were supposed to have.  If nothing is done, we are inevitably heading for a massive amount of economic pain as a nation.  So please share this article with as many people as you can.  The following are 100 reasons why the Federal Reserve should be shut down forever…

#1 We like to think that we have a government “of the people, by the people, for the people”, but the truth is that an unelected, unaccountable group of central planners has far more power over our economy than anyone else in our society does.

#2 The Federal Reserve is actually “independent” of the government.  In fact, the Federal Reserve has argued vehemently in federal court that it is “not an agency” of the federal government and therefore not subject to the Freedom of Information Act.

#3 The Federal Reserve openly admits that the 12 regional Federal Reserve banks are organized “much like private corporations“.

#4 The regional Federal Reserve banks issue shares of stock to the “member banks” that own them.

#5 100% of the shareholders of the Federal Reserve are private banks.  The U.S. government owns zero shares.

#6 The Federal Reserve is not an agency of the federal government, but it has been given power to regulate our banks and financial institutions.  This should not be happening.

#7 According to Article I, Section 8 of the U.S. Constitution, the U.S. Congress is the one that is supposed to have the authority to “coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures”.  So why is the Federal Reserve doing it?

#8 If you look at a “U.S. dollar”, it actually says “Federal Reserve note” at the top.  In the financial world, a “note” is an instrument of debt.

#9 In 1963, President John F. Kennedy issued Executive Order 11110 which authorized the U.S. Treasury to issue “United States notes” which were created by the U.S. government directly and not by the Federal Reserve.  He was assassinated shortly thereafter.

#10 Many of the debt-free United States notes issued under President Kennedy are still in circulation today.

#11 The Federal Reserve determines what levels some of the most important interest rates in our system are going to be set at.  In a free market system, the free market would determine those interest rates.

#12 The Federal Reserve has become so powerful that it is now known as “the fourth branch of government“.

#13 The greatest period of economic growth in U.S. history was when there was no central bank.

#14 The Federal Reserve was designed to be a perpetual debt machine.  The bankers that designed it intended to trap the U.S. government in a perpetual debt spiral from which it could never possibly escape.  Since the Federal Reserve was established 100 years ago, the U.S. national debt has gotten more than 5000 times larger.

#15 A permanent federal income tax was established the exact same year that the Federal Reserve was created.  This was not a coincidence.  In order to pay for all of the government debt that the Federal Reserve would create, a federal income tax was necessary.  The whole idea was to transfer wealth from our pockets to the federal government and from the federal government to the bankers.

#16 The period prior to 1913 (when there was no income tax) was the greatest period of economic growth in U.S. history.

#17 Today, the U.S. tax code is about 13 miles long.

#18 From the time that the Federal Reserve was created until now, the U.S. dollar has lost 98 percent of its value.

#19 From the time that President Nixon took us off the gold standard until now, the U.S. dollar has lost 83 percent of its value.

#20 During the 100 years before the Federal Reserve was created, the U.S. economy rarely had any problems with inflation.  But since the Federal Reserve was established, the U.S. economy has experienced constant and never ending inflation.

#21 In the century before the Federal Reserve was created, the average annual rate of inflation was about half a percent.  In the century since the Federal Reserve was created, the average annual rate of inflation has been about 3.5 percent.

#22 The Federal Reserve has stripped the middle class of trillions of dollars of wealth through the hidden tax of inflation.

#23 The size of M1 has nearly doubled since 2008 thanks to the reckless money printing that the Federal Reserve has been doing.

#24 The Federal Reserve has been starting to behave like the Weimar Republic, and we all remember how that ended.

#25 The Federal Reserve has been consistently lying to us about the level of inflation in our economy.  If the inflation rate was still calculated the same way that it was back when Jimmy Carter was president, the official rate of inflation would be somewhere between 8 and 10 percent today.

#26 Since the Federal Reserve was created, there have been 18 distinct recessions or depressions: 1918, 1920, 1923, 1926, 1929, 1937, 1945, 1949, 1953, 1958, 1960, 1969, 1973, 1980, 1981, 1990, 2001, 2008.

#27 Within 20 years of the creation of the Federal Reserve, the U.S. economy was plunged into the Great Depression.

#28 The Federal Reserve created the conditions that caused the stock market crash of 1929, and even Ben Bernanke admits that the response by the Fed to that crisis made the Great Depression even worse than it should have been.

#29 The “easy money” policies of former Fed Chairman Alan Greenspan set the stage for the great financial crisis of 2008.

#30 Without the Federal Reserve, the “subprime mortgage meltdown” would probably never have happened.

#31 If you can believe it, there have been 10 different economic recessions since 1950.  The Federal Reserve created the “dotcom bubble”, the Federal Reserve created the “housing bubble” and now it has created the largest bond bubble in the history of the planet.

#32 According to an official government report, the Federal Reserve made 16.1 trillion dollars in secret loans to the big banks during the last financial crisis.  The following is a list of loan recipients that was taken directly from page 131 of the report…

Citigroup – $2.513 trillion Morgan Stanley – $2.041 trillion Merrill Lynch – $1.949 trillion Bank of America – $1.344 trillion Barclays PLC – $868 billion Bear Sterns – $853 billion Goldman Sachs – $814 billion Royal Bank of Scotland – $541 billion JP Morgan Chase – $391 billion Deutsche Bank – $354 billion UBS – $287 billion Credit Suisse – $262 billion Lehman Brothers – $183 billion Bank of Scotland – $181 billion BNP Paribas – $175 billion Wells Fargo – $159 billion Dexia – $159 billion Wachovia – $142 billion Dresdner Bank – $135 billion Societe Generale – $124 billion “All Other Borrowers” – $2.639 trillion

#33 The Federal Reserve also paid those big banks $659.4 million in “fees” to help “administer” those secret loans.

#34 During the last financial crisis, big European banks were allowed to borrow an “unlimited” amount of money from the Federal Reserve at ultra-low interest rates.

#35 The “easy money” policies of Federal Reserve Chairman Ben Bernanke have created the largest financial bubble this nation has ever seen, and this has set the stage for the great financial crisis that we are rapidly approaching.

#36 Since late 2008, the size of the Federal Reserve balance sheet has grown from less than a trillion dollars to more than 4 trillion dollars.  This is complete and utter insanity.

#37 During the quantitative easing era, the value of the financial securities that the Fed has accumulated is greater than the total amount of publicly held debt that the U.S. government accumulated from the presidency of George Washington through the end of the presidency of Bill Clinton.

#38 Overall, the Federal Reserve now holds more than 32 percent of all 10 year equivalents, and that percentage is rising by about 0.3 percent each week.

#39 Quantitative easing creates financial bubbles, and when quantitative easing ends those bubbles tend to deflate rapidly.

#40 Most of the new money created by quantitative easing has ended up in the hands of the very wealthy.

#41 According to a prominent Federal Reserve insider, quantitative easing has been one giant “subsidy” for Wall Street banks.

#42 As one CNBC article recently stated, we are seeing absolutely rampant inflation in “stocks and bonds and art and Ferraris“.

#43 Donald Trump once made the following statement about quantitative easing: “People like me will benefit from this.

#44 Most people have never heard about this, but a very interesting study conducted for the Bank of England shows that quantitative easing actually increases the gap between the wealthy and the poor.

#45 The gap between the top one percent and the rest of the country is now the greatest that it has been since the 1920s.

#46 The mainstream media has sold quantitative easing to the American public as an “economic stimulus program”, but the truth is that the percentage of Americans that have a job has actually gone down since quantitative easing first began.

#47 The Federal Reserve is supposed to be able to guide the nation toward “full employment”, but the reality of the matter is that an all-time record 102 million working age Americans do not have a job right now.  That number has risen by about 27 million since the year 2000.

#48 For years, the projections of economic growth by the Federal Reserve have consistently overstated the strength of the U.S. economy.  But every single time, the mainstream media continues to report that these numbers are “reliable” even though all they actually represent is wishful thinking.

#49 The Federal Reserve system fuels the growth of government, and the growth of government fuels the growth of the Federal Reserve system.  Since 1970, federal spending has grown nearly 12 times as rapidly as median household income has.

#50 The Federal Reserve is supposed to look out for the health of all U.S. banks, but the truth is that they only seem to be concerned about the big ones.  In 1985, there were more than 18,000 banks in the United States.  Today, there are only 6,891 left.

#51 The six largest banks in the United States (JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs and Morgan Stanley) have collectively gotten 37 percent larger over the past five years.

#52 The U.S. banking system has 14.4 trillion dollars in total assets.  The six largest banks now account for 67 percent of those assets and all of the other banks account for only 33 percent of those assets.

#53 The five largest banks now account for 42 percent of all loans in the United States.

#54 We were told that the purpose of quantitative easing is to help “stimulate the economy”, but today the Federal Reserve is actually paying the big banks not to lend out 1.8 trillion dollars in “excess reserves” that they have parked at the Fed.

#55 The Federal Reserve has allowed an absolutely gigantic derivatives bubble to inflate which could destroy our financial system at any moment.  Right now, four of the “too big to fail” banks each have total exposure to derivatives that is well in excess of 40 trillion dollars.

#56 The total exposure that Goldman Sachs has to derivatives contracts is more than 381 times greater than their total assets.

#57 Federal Reserve Chairman Ben Bernanke has a track record of failure that would make the Chicago Cubs look good.

#58 The secret November 1910 gathering at Jekyll Island, Georgia during which the plan for the Federal Reserve was hatched was attended by U.S. Senator Nelson W. Aldrich, Assistant Secretary of the Treasury Department A.P. Andrews and a whole host of representatives from the upper crust of the Wall Street banking establishment.

#59 The Federal Reserve was created by the big Wall Street banks and for the benefit of the big Wall Street banks.

#60 In 1913, Congress was promised that if the Federal Reserve Act was passed that it would eliminate the business cycle.

#61 There has never been a true comprehensive audit of the Federal Reserve since it was created back in 1913.

#62 The Federal Reserve system has been described as “the biggest Ponzi scheme in the history of the world“.

#63 The following comes directly from the Fed’s official mission statement: “To provide the nation with a safer, more flexible, and more stable monetary and financial system.”  Without a doubt, the Federal Reserve has failed in those tasks dramatically.

#64 The Fed decides what the target rate of inflation should be, what the target rate of unemployment should be and what the size of the money supply is going to be.  This is quite similar to the “central planning” that goes on in communist nations, but very few people in our government seem upset by this.

#65 A couple of years ago, Federal Reserve officials walked into one bank in Oklahoma and demanded that they take down all the Bible verses and all the Christmas buttons that the bank had been displaying.

#66 The Federal Reserve has taken some other very frightening steps in recent years.  For example, back in 2011 the Federal Reserve announced plans to identify “key bloggers” and to monitor “billions of conversations” about the Fed on Facebook, Twitter, forums and blogs.  Someone at the Fed will almost certainly end up reading this article.

#67 Thanks to this endless debt spiral that we are trapped in, a massive amount of money is transferred out of our pockets and into the pockets of the ultra-wealthy each year.  Incredibly, the U.S. government spent more than 415 billion dollars just on interest on the national debt in 2013.

#68 In September, the average rate of interest on the government’s marketable debt was 1.981 percent.  In January 2000, the average rate of interest on the government’s marketable debt was 6.620 percent.  If we got back to that level today, we would be paying more than a trillion dollars a year just in interest on the national debt and it would collapse our entire financial system.

#69 The American people are being killed by compound interest but most of them don’t even understand what it is.  Albert Einstein once made the following statement about compound interest…

Compound interest is the eighth wonder of the world. He who understands it, earns it … he who doesn’t … pays it.”

#70 Most Americans have absolutely no idea where money comes from.  The truth is that the Federal Reserve just creates it out of thin air.  The following is how I have previously described how money is normally created by the Fed in our system…

When the U.S. government decides that it wants to spend another billion dollars that it does not have, it does not print up a billion dollars.

Rather, the U.S. government creates a bunch of U.S. Treasury bonds (debt) and takes them over to the Federal Reserve.

The Federal Reserve creates a billion dollars out of thin air and exchanges them for the U.S. Treasury bonds.

#71 What does the Federal Reserve do with those U.S. Treasury bonds?  They end up getting auctioned off to the highest bidder.  But this entire process actually creates more debt than it does money…

The U.S. Treasury bonds that the Federal Reserve receives in exchange for the money it has created out of nothing are auctioned off through the Federal Reserve system.

But wait.

There is a problem.

Because the U.S. government must pay interest on the Treasury bonds, the amount of debt that has been created by this transaction is greater than the amount of money that has been created.

So where will the U.S. government get the money to pay that debt?

Well, the theory is that we can get money to circulate through the economy really, really fast and tax it at a high enough rate that the government will be able to collect enough taxes to pay the debt.

But that never actually happens, does it?

And the creators of the Federal Reserve understood this as well.  They understood that the U.S. government would not have enough money to both run the government and service the national debt.  They knew that the U.S. government would have to keep borrowing even more money in an attempt to keep up with the game.

#72 Of course the U.S. government could actually create money and spend it directly into the economy without the Federal Reserve being involved at all.  But then we wouldn’t be 17 trillion dollars in debt and that wouldn’t serve the interests of the bankers at all.

#73 The following is what Thomas Edison once had to say about our absolutely insane debt-based financial system…

That is to say, under the old way any time we wish to add to the national wealth we are compelled to add to the national debt.

Now, that is what Henry Ford wants to prevent. He thinks it is stupid, and so do I, that for the loan of $30,000,000 of their own money the people of the United States should be compelled to pay $66,000,000 — that is what it amounts to, with interest. People who will not turn a shovelful of dirt nor contribute a pound of material will collect more money from the United States than will the people who supply the material and do the work. That is the terrible thing about interest. In all our great bond issues the interest is always greater than the principal. All of the great public works cost more than twice the actual cost, on that account. Under the present system of doing business we simply add 120 to 150 per cent, to the stated cost.

But here is the point: If our nation can issue a dollar bond, it can issue a dollar bill. The element that makes the bond good makes the bill good.

#74 The United States now has the largest national debt in the history of the world, and we are stealing more than 100 million dollars from our children and our grandchildren every single hour of every single day in a desperate attempt to keep the debt spiral going.

#75 Thomas Jefferson once stated that if he could add just one more amendment to the U.S. Constitution it would be a ban on all government borrowing….

I wish it were possible to obtain a single amendment to our Constitution. I would be willing to depend on that alone for the reduction of the administration of our government to the genuine principles of its Constitution; I mean an additional article, taking from the federal government the power of borrowing.

#76 At this moment, the U.S. national debt is sitting at $17,251,528,475,994.19.  If we had followed the advice of Thomas Jefferson, it would be sitting at zero.

#77 When the Federal Reserve was first established, the U.S. national debt was sitting at about 2.9 billion dollars.  On average, we have been adding more than that to the national debt every single day since Obama has been in the White House.

#78 We are on pace to accumulate more new debt under the 8 years of the Obama administration than we did under all of the other presidents in all of U.S. history combined.

#79 If all of the new debt that has been accumulated since John Boehner became Speaker of the House had been given directly to the American people instead, every household in America would have been able to buy a new truck.

#80 Between 2008 and 2012, U.S. government debt grew by 60.7 percent, but U.S. GDP only grew by a total of about 8.5 percent during that entire time period.

#81 Since 2007, the U.S. debt to GDP ratio has increased from 66.6 percent to 101.6 percent.

#82 According to the U.S. Treasury, foreigners hold approximately 5.6 trillion dollars of our debt.

#83 The amount of U.S. government debt held by foreigners is about 5 times larger than it was just a decade ago.

#84 As I have written about previously, if the U.S. national debt was reduced to a stack of one dollar bills it would circle the earth at the equator 45 times.

#85 If Bill Gates gave every single penny of his entire fortune to the U.S. government, it would only cover the U.S. budget deficit for 15 days.

#86 Sometimes we forget just how much money a trillion dollars is.  If you were alive when Jesus Christ was born and you spent one million dollars every single day since that point, you still would not have spent one trillion dollars by now.

#87 If right this moment you went out and started spending one dollar every single second, it would take you more than 31,000 years to spend one trillion dollars.

#88 In addition to all of our debt, the U.S. government has also accumulated more than 200 trillion dollars in unfunded liabilities.  So where in the world will all of that money come from?

#89 The greatest damage that quantitative easing has been causing to our economy is the fact that it is destroying worldwide faith in the U.S. dollar and in U.S. debt.  If the rest of the world stops using our dollars and stops buying our debt, we are going to be in a massive amount of trouble.

#90 Over the past several years, the Federal Reserve has been monetizing a staggering amount of U.S. government debt even though Ben Bernanke once promised that he would never do this.

#91 China recently announced that they are going to quit stockpiling more U.S. dollars.  If the Federal Reserve was not recklessly printing money, this would probably not have happened.

#92 Most Americans have no idea that one of our most famous presidents was absolutely obsessed with getting rid of central banking in the United States.  The following is a February 1834 quote by President Andrew Jackson about the evils of central banking….

I too have been a close observer of the doings of the Bank of the United States. I have had men watching you for a long time, and am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country. When you won, you divided the profits amongst you, and when you lost, you charged it to the Bank. You tell me that if I take the deposits from the Bank and annul its charter I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves. I have determined to rout you out and, by the Eternal, (bringing his fist down on the table) I will rout you out.

#93 There are plenty of possible alternative financial systems, but at this point all 187 nations that belong to the IMF have a central bank.  Are we supposed to believe that this is just some sort of a bizarre coincidence?

#94 The capstone of the global central banking system is an organization known as the Bank for International Settlements.  The following is how I described this organization in a previous article

An immensely powerful international organization that most people have never even heard of secretly controls the money supply of the entire globe.  It is called the Bank for International Settlements, and it is the central bank of central banks.  It is located in Basel, Switzerland, but it also has branches in Hong Kong and Mexico City.  It is essentially an unelected, unaccountable central bank of the world that has complete immunity from taxation and from national laws.  Even Wikipedia admits that “it is not accountable to any single national government.”  The Bank for International Settlements was used to launder money for the Nazis during World War II, but these days the main purpose of the BIS is to guide and direct the centrally-planned global financial system.  Today, 58 global central banks belong to the BIS, and it has far more power over how the U.S. economy (or any other economy for that matter) will perform over the course of the next year than any politician does.  Every two months, the central bankers of the world gather in Basel for another “Global Economy Meeting”.  During those meetings, decisions are made which affect every man, woman and child on the planet, and yet none of us have any say in what goes on.  The Bank for International Settlements is an organization that was founded by the global elite and it operates for the benefit of the global elite, and it is intended to be one of the key cornerstones of the emerging one world economic system.

#95 The borrower is the servant of the lender, and the Federal Reserve has turned all of us into debt slaves.

#96 Debt is a form of social control, and the global elite use all of this debt to dominate all the rest of us.  40 years ago, the total amount of debt in our system (all government debt, all business debt, all consumer debt, etc.) was sitting at about 2 trillion dollars.  Today, the grand total exceeds 56 trillion dollars.

#97 Unless something dramatic is done, our children and our grandchildren will be debt slaves for their entire lives as they service our debts and pay for our mistakes.

#98 Now that you know this information, you are responsible for doing something about it.

#99 Congress has the power to shut down the Federal Reserve any time that they would like.  But right now most of our politicians fully endorse the current system, and nothing is ever going to happen until the American people start demanding change.

#100 The design of the Federal Reserve system was flawed from the very beginning.  If something is not done very rapidly, it is inevitable that our entire financial system is going to suffer an absolutely nightmarish collapse.

The truth is that we do not have to have a Federal Reserve.  The greatest period of economic growth in U.S. history was when we did not have a central bank.  If we are ever going to turn this nation around economically, we are going to have to get rid of this debt-based financial system that is centered around the Federal Reserve.  On the path that we are on now, there is no hope.  Please share this article with as many people as you can.  It is imperative that we try to wake the American people up while we still have time.