Imagine walking around with some loose change in your pockets, some $70 to $90 worth in loose change to be exact, or as exact as you can be.
All of a sudden you get the idea that you may have dropped a cent. You now fear a financial crisis with devastating consequences and feel the urge to compensate for the lost cent by borrowing $hundreds.
You believe yourself to be sane.
The one cent and the $70-90 represent the Greek debt in relation to the debt volume owed by the G-20 countries.
The real amount of the Greece-rescue-package stands at Euros 110bn (but it could be a few cents more) of which 8bn were supposed to be paid this week. The EU did not pay.
Greece announced to have found 1.5bn stashed away under some mattress that nobody knew about, so all is well and they have enough to pay their bills for this month and next.
Nevertheless the EU plans to create a Euro 2 trillion (2000 billion) “rescue umbrella” to cover those countries that have not looked under their mattresses yet.
The world economic system, neo-liberal capitalism, is an unsustainable system, a ponzi scheme that creates money out of thin air for the benefit of a few, a very few.
In order to make this case we need to look at how debt is created. This is best understood by ten year olds as these still have an unadulterated mind and can add two and two together:
3 workers earn $1.000 each. Add one government employee earning $1.500.
How much tax do the 3 workers have to pay to cover this 4th person?
The ten year old will say 50% = $500 each.
Now add a 5th person, a pensioner getting $900. The ten year old works the total tax burden out to 80%.
Now add a 6th person, the unemployed getting $600. The ten year old concludes the tax rate has to be 100%.
The government still spends a bit more, on diverse services and goods like bombs that have a “use by date” stamped on them, so these need to be dropped somewhere and replaced and dropped again and replaced again, etc. That’s another $3.000 bringing the tax rate up to 200%.
The ten year old says this system cannot work. The ingenious government makes it work, it even leaves the three workers some 70% and takes some 30% only, the less you take off them the more likely they will vote for you again.
So you have $900 in tax revenue and $5.100 in goverment expenditure. Now the gov issues bonds for these $5.100, the central bank sells these at 1% interest to banks and the banks charge the gov 2% (or 3% or more). So the banks profit without having to lift a finger. All parties involved know that the gov has no intentions of ever repaying these debts and no ability to do so anyway. When those bonds are due they get replaced with new ones, and more new ones are added year after year.
This system keeps ticking over as long as the interest gets paid. The interest rate depends on the credibility of a gov determined by a credit-rating agency which has no democratic accountability, an institution that acts at will.
The ten year old thinks this is absolute madness. Banks and credit rating agencies can create as much money as they like by working together and encouraging governments to issue more bonds = creating more debt.
There is another slight problem. The three workers in that country do not produce enough goods, so imports are needed to meet the needs of the people. This is the game of trade surpluses and trade deficits. As a matter of fact there are only three countries that have a trade surplus, China, Germany and Japan, the rest of the world runs trade deficits and depends on those three.
Germany achieved this position in spite of a strong Deutschmark which made goods for export expensive. To be even more successful they needed a weaker currency. A One-World currency would be ideal for them, weak economies weigh down the value and the strong economies benefit.
So they started by creating the Euro. Adding France and Benelux countries would make the Euro only slightly weaker than the Deutschmark, so Italy and Spain were added. On top of this they added 3 small countries which could never meet the regulations of monetary discipline required for the Euro from the onset, these are Eire, Portugal and Greece.
These three serve one purpose only, their share in the Euro is minute, they can be manipulated and made to fail in order to bring the value of the Euro down. Markets always fall for manipulations and never look at the real percentage a country holds in a currency.
The US has manipulated the US$ down through printing endless amounts (Quantitative Easing) which pushed the Euro up and made imports more expensive = less competitive.
Now Germany pushes the Euro down by telling the markets that there is a crisis. Indicating that a “rescue fund” of Euro 2tn needs to be created convinces the markets that the Euro will be managed in the same way as the US$, both will print endless money to shadow their values against each other.
So we effectively have a One-World currency going by two names, US$ and Euro.
This is the dream constellation of those wishing to create a One-World government.
Money reserves held by the central banks of all countries around the globe are 60% in US$ and 26.6% in Euros. That’s 84.6% and the remaining 15.4% don’t count. Swiss franks and Pound Sterling are so low in volume that they have become a toy for speculators. Soros brought Sterling down in 1992 already by selling it short.
In this context we need to look at German banks. These hold assets of Euro 2.2tn of which 1.4tn are in the EU. I pick the most relevant countries:
The ten year old notices that even a total loss of 24bn in Greece accounts for not much more than a bad trading week when you have 2200bn to play with. It is already more than covered by the profits gained from bringing the Euro down last week, they hold 383bn in the US.
They also hold 378bn in UK (compare this to equally sized France or Italy), that’s more danger to Britain than an invading army. It enables the German banks to determine the value of Sterling. It constitutes a few times the amount Soros needed to crash Sterling in 1992, and is used to prop up Sterling so that people can afford Mercedeses and BMWs. You can also prop up Sterling for the purpose of profit taking. These profits are the loss of the British economy. So Cameron talks about a debt crisis and advises the public to pay off credit cards, store cards, overdrafts and mortgages.
This is brillant advise and would be perfect could he indicate where to take the money from to do this.
Let’s summarize: the assets of banks are worthless bonds that create new money through interest. Should manipulators point out that a bond is worthless the asset of a bank gets depleted. In that case the government issues new bonds that generate instant profits for banks, this is called a bank bailout. This system answers the question “do governments control banks or do banks control governments?”. Naturally the banks are owned by the rich.
As a citizen of any state of this world you may ask yourself “do I really want to pay taxes and take out credits and pay interest and have governments taking out credits on my behalf and on behalf of my children and grand children and keep this system going for the benefit of the rich?”
Should you conclude that this is not what you want you have an alternative, you can join Permaculture Paraguay, Pecu. http://infoholix.net/category.php?mId=111