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Biggest act of civil disobedience in Canadian history

MONTREAL – A protest that organizers are describing as the single biggest act of civil disobedience in Canadian history choked the streets of downtown Montreal in the middle of Tuesday’s afternoon rush hour as tens of thousands of demonstrators expressed outrage over a provincial law aimed at containing the very sort of march they staged.

But within three hours of the march’s start, police were reporting that criminal acts were being committed as the windows of at least one bank were smashed.

Ostensibly, Tuesday’s march was to commemorate the 100th day of a strike by Quebec college and university students over the issue of tuition fee increases. But a decision last Friday by the Charest government to pass Bill 78 — emergency legislation requiring protest organizers to provide police with an itinerary of their march eight hours in advance — not only enraged civil libertarians and legal experts, but also seems to have galvanized ordinary Quebecers into marching through the streets of a city that has seen protests staged here nightly for the past seven weeks.

“I didn’t really have a stand when it came to the tuition hikes,” said Montrealer Gilles Marcotte, a 32-year-old office worker who used a vacation day to attend the event. “But when I saw what the law does, not just to students but everybody, I felt I had to do something. This is all going too far.”

Tuesday’s march was billed as being two demonstrations taking place at the same time. One, organized by the federations representing Quebec college and university students and attended by contingents from the province’s labour movement, abided by the provisions of the law and provided a route. The other, overseen by CLASSE, an umbrella group of students associations, deliberately did not.

By 3:30 p.m., a little more than 90 minutes after the marches began to snake their way through downtown Montreal, CLASSE, which would later estimate the crowd at about 250,000, described the march as “the single biggest act of civil disobedience in Canadian history.”

By 4:30 p.m. Montreal police, who refuse publicly to estimate crowd sizes, said no acts of mischief had been reported nor any arrests made. There was one report of a van carrying a provincial police riot squad platoon having to nose its way through demonstrators who tried to block it. But half an hour later, police were reporting “criminal acts” were being committed as bank windows on Ste. Catherine St. were being smashed.

Montreal police made it clear they were prepared to tolerate the CLASSE march, illegal though it is, and the presence of masks and other face coverings on hundreds of protesters showed also that a municipal bylaw adopted last Friday banning face coverings during public demonstrations was also going unenforced.

Last Saturday, Montreal police made it clear they would use their “judgment” when it came to applying the provincial or municipal regulations.

Prior to Tuesday’s march, the heads of federations engaged in the legal protest said they hoped the Charest government would re-think its stand on Bill 78, which they intend to challenge in court by the end of this week, and resume negotiations on the issue of tuition increases.

“This march isn’t just to observe the 100th day of our strike, but to deplore the fact the Charest government had to resort to repression,” college student federation head Léo Bureau-Blouin told reporters. “But we have decided to provide the police with a route and intend to demonstrate peacefully.”

How much longer the march may last may be beyond the power of organizers or police to predict.

As of 3:45 p.m. a severe thunderstorm warning was issued for the Montreal area.

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!! RED ALERT !! Emergency Broadcast : On The Brink of WW3

As the world sits on the eve of the looming breakout of thermonuclear war and economic meltdown, Lyndon LaRouche made an emergency international broadcast, calling for immediate action to remove Barack Obama from office, by purely constitutional means, as the only act which can guarantee the avoidance of a global nuclear holocaust in the very near term.

Exclusive: Military to Designate U.S. Citizens as Enemy During Collapse

FEMA Continuity of Government Plans Prep Total Takeover of Society, Dispatching Military Domestically Under Economic Collapse Emergency

Aaron Dykes and Alex Jones
Infowars.com
December 21, 2011

NOTE: Within an hour of posting this article and linking to the pertinent document, the feds at FBO.gov have pulled the link and implied that it was a classified posting. We believe this was public and of interest to American citizens, taxpayers and peoples of the world and are in the process re-establishing an archive link of the material. Obviously, however, this information is revealing and certain parties do not wish it to be widely known. If you believe this material is important, please archive it and share it with your contacts. In the meantime, here are links to many of the pages: Page 1, Page 2, Page 3, Page 4, Page 5, Page 6, Page 7, Page 8, Page 9, Page 10, Page 11

Infowars has discovered new FEMA documents that confirm information received from DoD sources that show military involvement in a FEMA-led takeover within the United States under partially-classified Continuity of Government (COG) plans. It involves not only operations for the relocation of COG personnel and key officials, population management, emergency communications and alerts but the designation of the American people as ‘enemies’ under a live military tracking system known as Blue Force Situational Awareness (BFSA).

Further, this Nov. 18, 2011 FEMA-released plan National Continuity Programs (NCP) Program and Mission Support Services (PAMSS) [PDF] linked at the FedBizOpps.gov website outlines a scenario that overlays with eerie accuracy the bigger picture sketched out by concurrent calls for troops to keep order in the streets of places like New Orleans, as well as other bombshell documents like those released from KBR seeking to activate contracted staff for emergency detention centers and for services like fencing and barricades, as well as numerous agencies and think tanks who’ve prepared for civil unrest and economic breakdown in America.

Hold onto your seats. The plan for the takeover of the United States has not only been drafted, but activated. Our sources and independent research make this abundantly clear. Martial law scenarios preparing for a breakdown of order under the ongoing economic collapse are underway, even as pretexts for control are initiated in locales across the country. Bold individuals like Ron Paul have warned that dangerous legislation like the NDAA designate the American population as potential enemies. Now, there is more evidence this targeting of the people is sadly taking place.

A laundry list of operations organized under FEMA’s National Continuity Programs (NCP) provides a base of technical support for the deployment of national emergency plans and the logistical tracking of all personnel incorporated under what Homeland Security chief Janet Napolitano has lovingly termed the big “federal family.”

“Friendly” military and FEMA personnnel, along with their contracted employees and those of other federal agencies, will carry transponder ID badges, like those described here, to designate their “blue” inclusive status. As our military sources have confirmed, under the Blue Force Situational Awareness (BFSA) all other American citizens and civilians are designated under the “red” category and treated as an enemy or potential unfriendly. Throughout his past investigative work including witnessing numerous military drills, Alex Jones has also witnessed the technology and the use of this alarming code branding ordinary Americans as battlefield enemies. The plan includes drone and other high-tech tools to monitor and target individuals designated under the “enemy” status.

The military’s blue force tracking technology has been adopted since 2003 in Iraq and used in theaters like Afghanistan to quickly distinguish “Blue” friendlies (including U.S. forces and allies like tribal forces) from “Red” enemies. However, on the U.S. homeland battlefield, it is the American people who will be designated under “red,” whereas cleared occupying personnel are tracked as “blue” friendlies by their ID transponder badges. The designation was set-up to reduce “friendly fire” incidents.

Blue Force and other related programs like Geospatial Information Systems (GIS), Continuity Analysis and the Command, Control, Communications and Computing (C4) operations named in the document electronically track and verify the location and clearance of COG-related personnel, the usage of emergency shelter facilities and their components as well as the military’s friendly/enemy designations– creating a matrix for live monitoring and control coordinating with FEMA databases during martial law or national emergency scenarios.

For instance, FEMA acknowledges in its documents the use of Blue Force tracking systems and other geospatial information systems to monitor the capacity and usage of its facilities under the National Shelter System and other programs. Preparations for the orderly control of the masses have already been put into place.

In particular, the Mt. Weather Emergency Operations Center outside Washington, D.C. is empowered to “coordinate, track, and synchronize the relocation of key leadership and staff from the DHS and FEMA Emergency Relocation Groups (ERG) members to perform their essential functions” during a declared national emergency using the Blue Force and other related tracking programs managed under the established joint relocation operations control center and emergency relocation programs referenced in the document. Section 1.3.4 further details the minimum ID requirements for contractor employee identification and verification.

 

FEMA Shelter Support

The FEMA National Shelter System (NSS) is a comprehensive, Web-based database created to support Federal, State and local government agencies and voluntary organizations responsible for Mass Care and Emergency Assistance. The FEMA NSS allows users to identify, track, analyze, and report on data for virtually any facility associated with the congregate care of people and/or household pets following a disaster.

 

FEMA has also outlined detailed support for its vast Integrated Public Alert and Warning System (IPAWS), proscribed under Executive Order 13407 for the federal takeover of communications. It details the continuity of emergency communications and the issuance of warnings to the public, including public-private partnerships concerned with issuing alert messages through cellular providers– a program that only recently caused panic when it was publicly tested without forewarning in New Jersey. It is designated in the document under the Commercial Mobile Alerting System (CMAS).

As we have mentioned here and detailed in the past, this is part of larger COG government takeover– not part of any ordinary natural disaster response as the media has been told. The elite have initiated worldwide economic collapse and prepared their power-grabbing response as currencies and markets fall across the globe. All the experts we’ve talked to over the years concur with this basic analysis.

To put it simply: once the economic depression has sunken in completely, the population will willingly head in droves to government centers for basic requirements like food. As Henry Kissinger bluntly quipped, “Control oil and you control nations; control food and you control the people.” FEMA’s response will in hinge, in part, on just that– encouraging people sign up for their own enslavement.

Exclusive: Government Activating FEMA Camps Across U.S.

Kurt Nimmo and Alex Jones
Infowars.com
December 6, 2011

Infowars.com has received a document originating from Halliburton subsidiary KBR that provides details on a push to outfit FEMA and U.S. Army camps around the United States. Entitled “Project Overview and Anticipated Project Requirements,” the document describes services KBR is looking to farm out to subcontractors. The document was passed on to us by a state government employee who wishes to remain anonymous for obvious reasons.

Services up for bid include catering, temporary fencing and barricades, laundry and medical services, power generation, refuse collection, and other services required for temporary “emergency environment” camps located in five regions of the United States.

Internment Camp Services Bid Arrives After NDAA

KBR’s call for FEMA camp service bids arrives soon after the Senate overwhelmingly passed the National Defense Authorization Act (NDAA) which permits the military to detain and interrogate supposed domestic terror suspects in violation of the Fourth Amendment and Posse Comitatus.

Section 1031 of the NDAA bill declares the whole of the United States as a “battlefield” and allows American citizens to be arrested on U.S. soil and incarcerated in Guantanamo Bay.

A number of civil liberties groups have come out in strong opposition to the legislation, most notably the Japanese American Citizens League (JACL), the nation’s oldest and largest Asian American civil and human rights organization.

In a letter addressed to Congress, S. Floyd Mori, the national director of JACL, said the NDAA is the first time that Congress has scaled back on the protections provided by the Non-Detention Act of 1971. Mori said the legislation, if enacted and put into use, would be reminiscent of the unconstitutional indefinite detention of Japanese Americans during World War II.

Police State 4: The Rise of FEMA.

KBR Instrumental in Establishing Camps in 2006

In 2006, KBR was awarded a contingency contract from the Department of Homeland Security, allegedly to support its Immigration and Customs Enforcement facilities in the event of an emergency, Market Watch reported.

The contract was effective immediately and provided for establishing temporary detention and processing capabilities to expand existing ICE Detention and Removal Operations Program facilities in the event of an emergency influx of immigrants into the U.S., or to support the rapid development of new programs, KBR said. The contract may also provide migrant detention support to other government organizations in the event of an immigration emergency, as well as the development of a plan to react to a national emergency, such as a natural disaster, the company explained.

The 45 regions indicated in the KBR document.

Army Releases Civilian Inmate Labor Program Document

Soon after KBR’s announcement, a little-known Army document surfaced. Entitled the “Civilian Inmate Labor Program,” the unclassified document describes in detail Army Regulation 210-35. The regulation, first drafted in 1997, underwent a “rapid act revision” in January 2005 and now provides a policy for the creation of labor programs and prison camps on Army installations.

National Emergency Centers Act

In 2009, the National Emergency Centers Act or HR 645 was introduced in Congress. It mandates the establishment of “national emergency centers” to be located on military installations for the purpose of providing “temporary housing, medical, and humanitarian assistance to individuals and families dislocated due to an emergency or major disaster,” according to the bill.

In addition to emergencies, the legislation is designed to “meet other appropriate needs, as determined by the Secretary of Homeland Security,” an open ended mandate which many fear could mean the forced detention of American citizens in the event of widespread rioting after a national emergency or total economic collapse, as Paul Joseph Watson noted in January of 2009.

Clergy response teams.

Also in 2009, the Army National Guard began posting advertisements calling for Internment/Resettlement Specialists, a fact noted by Infowars.com, Prison Planet.com and other alternative media outlets but ignored by the establishment media.

Precursor: Rex 84 Mass Detention Operation

Rex 84, short for Readiness Exercise 1984, was established under the pretext of a “mass exodus” of illegal aliens crossing the Mexican/US border, the same pretense used in the language of the KBR request for services.

During the Iran-Contra hearings in 1987, however, it was revealed that the program was a secretive “scenario and drill” developed by the federal government to suspend the Constitution, declare martial law, assign military commanders to take over state and local governments, and detain large numbers of American citizens determined by the government to be “national security threats.”

Rex 84 was devised by Col. Oliver North, who was with the NSC and appointed liaison to FEMA. John Brinkerhoff, the deputy director of “national preparedness” programs for FEMA, and North designed the plan on a 1970 report written by FEMA chief Louis Giuffrida, at the Army War College, which proposed the detention of up to 21 million “American Negroes” in the event of a black militant uprising in the United States.

DHS Coordinating Occupy Arrests

Following a crackdown by police on Occupy Wall Street protesters around the nation, Oakland, California, mayor Jean Quan mentioned during an interview with the BBC that she was on a conference call with leaders of 18 US cities shortly before a wave of raids broke up Occupy Wall Street encampments across the country. It was later discovered that the FBI, the Department of Homeland Security and other federal police agencies had coordinated the often violent response to the protests.

New York Rep. Peter King, who heads up the House Homeland Security Subcommittee, signaled a sense of urgency when he said the federal government has “to be careful not to allow this movement to get any legitimacy. I’m taking this seriously in that I’m old enough to remember what happened in the 1960′s when the left-wing took to the streets and somehow the media glorified them and it ended up shaping policy. We can’t allow that to happen.”

The federal government responded similarly in the 1960s and 70s when the FBI organized and unleashed its unconstitutional secret police under the covert banner of COINTELPRO.

In addition to the DHS characterizing Americans supporting states’ rights and the Constitution as terrorists, the Defense Department’s Antiterrorism and Force Protection Annual Refresher Training Course in 2009 advised its personnel that political protest amounts to “low-level terrorism.”

Elements of the Police State Coming Together

The KBR document is more evidence that the federal government has established internment camps and plans to fill them with dissidents and anti-government activists that have been demonized consistently by the establishment media.

The NDAA was crafted precisely to provide the legal mechanism for tasking the military to round up activists it conflates with al-Qaeda terrorists. The plan was initially envisioned by Rex 84 and in particular Operation Garden Plot, an operational plan to use the Army, USAF, Navy, and Marine Corp. in direct support of civil disturbance control operations. It has since added numerous elements under the rubric of Continuity of Government, the overall war on terror, civil disturbance and emergency response.

The government has patiently put into place the crucial elements of its police state grid and overarching plan for the internment of political enemies.

We are quite literally one terror event away from the plan going live. As the DHS and the establishment media keep telling us, the next terror event will be on American soil and not the work of al-Qaeda but domestic patriot political groups. The FBI has specialized in creating domestic terrorists – or rather patsies – and shifting the blame over to their political enemies.

Silver: The Perfect Alternative to Gold?

By Melissa Pistilli, Resource Investing News:

The price of silver has closely tracked that of gold during the yellow metal’s recent bull run. Silver’s role as a precious metal has, at times, eclipsed any price negative news impacting much of the industrial commodities, a sector responsible for the majority silver demand.

Silver benefits from gold’s rising prices largely because investors, whether in the paper or the physical markets, view it as an attractive leveraged play on gold. Silver offers exposure to the rising demand for safe haven assets at a cheaper price, earning it the moniker “poor man’s gold”…

…Over this next year, analysts expect gold prices to reach even higher and for silver to continue outperforming gold. “When we look at gold versus silver, we feel that silver prices are going to enjoy more of a gain over the next year or so. I think by the middle of next year silver will be sitting at around $80,” TS Capital CEO David Stroud told Bloomberg Television earlier this month, calling silver “the perfect alternative” to gold…

Read More @ ResourceInvestingNews.com

Globalists Plan to Stay in Afghanistan Forever

Kurt Nimmo
Infowars.com
August 20, 2011

Ben Farmer, writing for The Telegraph on Friday, reported that the U.S. and Afghanistan have reached an agreement that would allow American special forces and air force to remain in the country until 2024. The agreement arrives as the United States claims it will pack up and leave by the end of 2014.

 

In December of 2009, during a speech delivered at West Point, Obama said troops would begin leaving Afghanistan. Prior to the speech, the Pentagon said it would send an additional 30,000 troops as part of a “mini-surge.” NATO was asked to send between 5,000 and 10,000 troops as part of an international force. In early 2010, the Pentagon increased substantially its “new civilian forces” outside of Kabul, according to ABC News.

Afghanistan’s hand-picked president, Hamid Karzai, confirmed earlier this year that the United States plans to establish permanent bases in his country. “Yes they want this (permanent bases) and we have been negotiating with them,” Karzai said at a press conference in his presidential palace in February. “We believe that a long-term relationship with the United States is in the interest of Afghanistan.”

The deal was negotiated without the participation or approval of the Afghan parliament or the grand tribal council known as the Loya Jirga.

The plan announced last week was peddled as part of the effort to train the Afghan military and police. “If [the Americans] provide us weapons and equipment, they need facilities to bring that equipment,” said Rangin Dadfar Spanta, Karzai’s top security adviser. “If they train our police and soldiers, then those trainers will not be 10 or 20, they will be thousands.”

The continued U.S. presence at numerous bases in Afghanistan is central to the generational war planned to fight against so-called international terrorism, itself a creation of U.S. and British intelligence. “We know we will be confronted with international terrorists. 2014, is not the end of international terrorist networks and we have a common commitment to fight them. For this purpose also, the US needs facilities,” said Spanta.

Andrey Avetisyan, Russian ambassador to Kabul, told The Telegraph permanent U.S. bases should not be required. “I don’t understand why such bases are needed. If the job is done, if terrorism is defeated and peace and stability is brought back, then why would you need bases?” he asked. “If the job is not done, then several thousand troops, even special forces, will not be able to do the job that 150,000 troops couldn’t do. It is not possible.”

The deal is designed to continue the engineered conflict in Afghanistan. The Taliban have said they will not negotiate peace with the government in Kabul until all U.S. troops have left the country. According to Abdul Hakim Mujahid, deputy leader of the “peace” council set up by Karzai to seek a settlement with the Taliban, the deal to keep a substantial number of U.S. troops in the country will intensify the insurgency.

In 2010, Pakistani president Asif Ali Zardari said the Taliban was created by the CIA and ISI, the Pakistan intelligence agency. He also said the Pentagon is orchestrating Taliban attacks.

Most Afghans believe the U.S. is funding and supporting the Taliban in order to continue the war and occupation of their country. “The US uses Israel to threaten the Arab states, and they want to make Afghanistan into the same thing,” a highly educated Afghan professional told The Guardian in May of 2010. “Whoever controls Asia in the future, controls the world.”

For more detail, see Afghans: U.S. Created and Funds Taliban.

Jimmy Carter’s national security adviser and Rockefeller globalist Zbigniew Brzezinski argued in his book, The Grand Chessboard: American Primacy and Its Geostrategic Imperatives, that controlling Eurasia is essential to the global pre-eminence of the elite. “It is imperative that no Eurasian challenger emerges capable of dominating Eurasia and thus of also challenging America,” he writes (by “America,” Brzezinski means the global elite represented by the CFR and the Trilateral Commission).

The Taliban originated from from Jamiat Ulema-e-Islam-run religious schools for Afghan refugees in Pakistan following the CIA’s war against the Soviet Union. Selig Harrison from the Woodrow Wilson International Center for Scholars has admitted that the CIA created the Taliban. Harrison is an expert on Asian affairs and has had extensive contact with the CIA and political leaders in South Asia. He is closely aligned with the globalists through the Carnegie Endowment for International Peace.

The anti-Soviet Mujahideen that provided recruits for the Taliban was aided by the CIA, a fact admitted by its former director, Robert Gates. The secret plan to create the Mujahideen prior to the invasion of the country was “was an excellent idea,” according to Brzezinski. “What is most important to the history of the world? The Taliban or the collapse of the Soviet empire? Some stirred-up Moslems or the liberation of Central Europe and the end of the cold war?” he told Le Nouvel Observateur in 1998.

The Pentagon will not leave Afghanistan in 2024. It plans to stay there forever and operate as a “muscle-man for Big Business, for Wall Street and for the Bankers,” as former Marine Major General Smedley Butler said in 1933, referring to his work for them in the Philippines, China, and Latin America.

Sources: Seal Team 6 Was Murdered

TheAlexJonesChannel
August 7, 2011

The SEALs team has reportedly been extremely angry about the fabricated OBL raid and ready to talk. Alex Jones to bring sources on air tomorrow LIVE at 11 AM CST

Secret Cloning Projects Exposed: Help Us Warn the World

TheAlexJonesChannel
July 27, 2011

Help us warn the world- send Alex’s latest video on the Genetic Genocide to everyone you know and/or make your own video,write your own article and tell your neighbor there’s more going on than just the ballgame.

RELATED: Genetic Genocide: Humanity’s Greatest Threat

RELATED: GM Human-Animal Hybrids Emerging Market for Organs, Babies, Pharma

Evidence Shows Norway Terror Attack a False Flag

Kurt Nimmo
Infowars.com
July 23, 2011

Prior to the events in Norway, the Department of Homeland Security released a propaganda video characterizing white middle class Americans as terrorists and members of white al-Qaeda, a term designed to conflate the image of the CIA-created Islamic terror group and “rightwing extremists” in America.

The DHS video is part of the government’s “See Something, Say Something” mass hysteria campaign and follows its report leaked to the media in 2009 designating libertarians and Second Amendment advocates as terrorists and right-wing extremists.

The alleged perpetrator in the Norway bombing and shooting is being described as a right-wing extremist who was a former member of a popular political party that regards itself to be a “libertarian people’s party” with an ideology based on classical liberalism.

Anders Behring Breivik was at one time a member of the Progress Party, according to news reports. He was a member from 2004 to 2006 and in its youth party from 1997-2006 through 2007.

The Progress Party platform preamble identifies the organization as populist libertarian and its main declared goal as a reduction in taxes and government intervention. The CFR says the Progress Party and similar political parties in Sweden and Finland represent a European Tea Party movement on the rise. In the U.S., the Tea Party has opposed government bailouts to the banksters and has called for ending the Federal Reserve.

The EU, the IMF and the international bankers are worried about growing populism in Europe. “Rising political populism around Europe, driven by public anger over the impact of the financial crisis, threatens to make solving the euro zone’s debt woes increasingly difficult,” Reuters reported in April.

Millions of Europeans are opposed to raiding their treasuries to pay for debt contrived by the bankers and have turned in large numbers to political parties such as the True Finns.

The True Finns’ main campaign plank is opposition to funding a bailout for Portugal. In April, the Finnish party emerged from relative obscurity and moved into the political limelight. Its sudden popularity took the European establishment by surprise.

The false flag attack in Norway arrives as populism grows in Germany, Europe’s reluctant paymaster for the contrived debt-based economic crisis.

Establishment politicians in Germany have balked at a second bankster bailout. “We did it once, and we cannot do it a second time, we simply can’t,” said Jochen Sanio, head of the German financial market watchdog BaFin. Sanio said if the government raided the German treasury again the “taxpayers would come and hang all of us.”

The EU and the European political establishment are beholden to the bankers and their “free market” – as in free to loot and plunder – neoliberal policies and have now pulled out all the stops in an effort to crush resistance to endless bailouts designed to crash local economies and destroy national sovereignty.

It is no mistake the corporate media is comparing Anders Behring Breivik to Timothy McVeigh. Hours after the terrorist attack, Norway’s public broadcaster NRK cited Tore Bjørgo at the Police College in Oslo who said the attack resembled the bombing of the federal building in Oklahoma City. The 1995 attack blamed on Timothy McVeigh killed 168 people.

Bjørgo mentioned The Turner Diaries, the “anti-government” novel written by William Luther Pierce, the former leader of the white nationalist organization National Alliance. The novel was introduced as evidence during the trial of Timothy McVeigh, the government agent patsy set-up to take the fall for the bombing.

The Oklahoma City bombing was a false flag event used to roll out several draconian aspects of the police state in the 1990s. Following the attack, Congress passed at the behest of then president Clinton a number of national security proposals that built the foundation and established antecedents for the PATRIOT Act in response to the staged attacks of September 11, 2011.

In addition to establishing a basis for so-called anti-terror legislation, the Oklahoma City bombing was used to demonize the patriot movement that formed in response to the brazen government attack on the Branch Davidians at Waco on April 19, 1993.

False flag attacks followed by intense propaganda campaigns are one of several methods used by  government to neutralize political opposition.

Breivik is obviously a patsy for a Gladio operation to destroy political opposition to the bankers. Operation Gladio was a “strategy of tension” devised by the elite that employed terrorism – assassination and bombings – to discredit political opponents in Europe. It was set-up by the CIA and staffed in part with former members of Mussolini’s secret police.

In the days ahead, we can expect more false flag terror events. These will be used by the corporate media to portray opponents to the bankster scam as child killing terrorists. For the global elite, mass murder blamed on political opponents is a legitimate tool in the plan to take down national economies and install a one-world totalitarian government and banking system run in neofeudal fashion.

The Great Global Debt Depression: It’s All Greek To Me

Andrew Gavin Marshall
Infowars.com
July 17, 2011

Introduction

In late June of 2011, the Greek government passed another round of  austerity measures, ostensibly aimed at getting Greece “back on track”  to economic progress, but in reality, implementing a systematic program  of ‘social genocide’ in the name of servicing an endless and  illegitimate debt to foreign banks. Right on cue, protests and riots  broke out in Athens against the draconian measures, and the state moved  in to do what states do best: oppress the people with riot police, tear  gas and bashing batons, leaving roughly 300 people injured.

Is Greece simply a case of a country full of lazy people who spent  beyond their means and are now paying for their own decadence? Or, is  there something much larger at stake – and at play – here? Greece is, in  fact, a microcosm of the global economy: mired in excessive debt,  economically ruined, increasingly politically repressive and socially  explosive. This report takes a look at the case of the Greek debt crisis  specifically, and places it within a wider global context. The  conclusion is clear: what happens in Greece will happen here.

This report examines the Greek crisis, as well as the larger global  economic crisis, including the origins of the housing bubble, the  bailouts, the banks, and the major actors and institutions which will  come to dominate the stage over the next decade in what will play out as  ‘The Great Global Debt Depression.’

An Olympian Debt

With the global economic crisis rampaging throughout the world in  2008, Greece experienced major protests and riots at government  reactions to the crisis. The unpopularity of the government led to an  election in which a Socialist government came to power in October of  2009 under the premise of promising an injection of 3 billion euros in  order to revive the Greek economy.[1] When the government came to power,  they inherited a debt that was double that which the previous  government had disclosed. This prompted Greece’s entry into a major debt  crisis, as the debt was roughly 127% of Greece’s GDP in 2009, and thus,  the costs of borrowing rose exponentially.

In April of 2010, Greece had to seek a bailout by the EU and the IMF  in order to pay the interest on its debt. However, by taking such a  bailout from the EU and IMF, Greece ultimately incurred a larger  long-term debt, as the money from these institutions simply added to the  overall debt, and thus, actually increased eventual interest payments  on that debt. Thus, we see the true nature of debt: a financial form of  slavery. Debt is designed in such a way that, like a fly caught in a  spider’s web, the more it struggles, the more entangled it gets; the  more it struggles to break free, the more it arouses the attention of  the spider, which quickly moves in to strike its prey – paralyzed – with  its venom, so that it may wrap the fly in its silk and eat it alive.  Debt is the silk, the people are the fly, and the spider is the large  financial institutions – from the banks to the IMF. The nature of debt  is that one is never meant to be able to escape it. Hence, the  “solution” for Greece’s debt problem – according to those who decide  policy – is for Greece to acquire more debt. Of course, this new debt is  used to pay the interest on the old debt (note: it is not used to pay  OFF the old debt, just the interest on it). However, the effect this has  is that it increases the over-all debt of the nation, which leads to  higher interest payments and thus a greater cost of borrowing. This,  ultimately, leads to a need to continue borrowing in order to pay off  the higher interest payments, and thus, the cycle continues. For all the  “bail outs” and aims at addressing Greece’s debt, this prescription  inevitably results in greater debt levels than those which induced the  debt crisis in the first place.

So why is this the prescription?

Not only does this prescription incur more debt to pay interest on  old debt, but the process of borrowing and “consolidating” debt has  devastating social and political consequences. For example, in the case  of Greece, in order to receive loans from the IMF and EU, Greece was  forced to impose “fiscal austerity measures.” This blatantly ambiguous  economic nomenclature of “fiscal austerity” is in fact more accurately  described in real human terms as “social genocide.” Why is this so?

‘Fiscal Austerity’ means that the state – in this case, Greece – must  engage in “fiscal consolidation.” In economic parlance, this implies  that the state must cut spending and increase taxes in order to  “service” its debt by reducing its annual deficit. Thus, the  ‘conditions’ for receiving a loan demand “fiscal austerity” measures  being implemented by the debtor nation. This is supposedly a way for the  lender to ensure that their loans are met with appropriate measures to  deal with the debt. The objective, purportedly, is to reduce expenditure  (spending) and increase revenue (income), allowing for more money to  pay off the debt. However, as with most economic concepts, the reality  is far different than the theoretical implications of “fiscal  austerity.”

In fact, ‘fiscal austerity’ is a state-implemented program of social  destruction, or ‘social genocide’. Such austerity measures include  cutting social spending, which means no more health care, education,  social services, welfare, pensions, etc. This directly implies a massive  wave of layoffs from the public sector, as those who worked in health  care, education, social services, etc., have their jobs eliminated.  This, naturally, creates a massive growth in poverty rates, with the  jobless and homeless rates climbing dramatically. Simultaneously, of  course, taxes are raised drastically, so that in a social situation in  which the middle and lower classes are increasingly impoverished, they  are then over-taxed. This creates a further drain of wealth, and  consumption levels go down, further driving production levels downward,  and (local) private businesses cannot compete with foreign multinational  conglomerates, and so businesses close and more lay-offs take place.  After all, without a market for consumption, there is no demand for  production. In a country such as Greece, where the percentage of people  in the employ of the state is roughly 25%, these measures are  particularly devastating.

Naturally, in such situations, the masses of people – those who are  doomed to suffer most – are left greatly impoverished and the middle  classes essentially vanish, and are absorbed into the lower class. As  social services vanish when they are needed most, life expectancy rates  decrease. With few jobs and massive unemployment, many are left to  choose between buying food or medicine, if those are even options. Crime  rates naturally increase in such situations, as desperate conditions  breed desperate actions. This creates, especially among the educated  youth who graduate into a jobless market, a ‘poverty of expectations,’  having grown up with particular expectations of what they would have in  terms of opportunities, which then vanish quite suddenly. This results  in enormous social stress, and often, social unrest: protests, riots,  rebellion, and even revolution in extreme circumstances. These are  exactly the conditions that led to the uprising in Egypt.

The reflexive action of states, therefore, is to move in to repress –  most often quite violently – protests and demonstrations. The aim here  is to break the will of the people. Thus, the more violent and brutal  the repression, the more likely it is that the people may succumb to the  state and consent – even if passively – to their social conditions.  However, as the state becomes more repressive, this often breeds a more  reactive and radical resistance. When the state oppresses 500 people one  day, 5,000 may show up the next. This requires, from the view of the  state, an exponentially increased rate of oppression. The risk in this  strategy is that the state may overstep itself and the people may become  massively mobilized and intensely radicalized and overthrow – or at  least overcome – the power of the state. In such situations, the  political leadership is often either urged by a foreign power to leave  (such as in the case of Egypt’s Mubarak), or flees of their own will  (such as in Argentina), in order to prevent a true revolution from  taking place. So, while the strategy holds enormous risk, it is often  employed because it also contains possible reward: that the state may  succeed in destroying the will of the people to resist, and they may  subside to the will of the state and thereby consent to their new  conditions of social genocide.

Social genocide is a slow, drawn-out and incremental process. Its  effects are felt by poor children first, as they are those who need  health care and social services more than any other, and are left hungry  and unable to go to school or work. They are the ‘forgotten’ of  society, and they suffer deeply as such. The reverberations, however,  echo throughout the whole of society. The rich get richer and the poor  get poorer, while the middle class is absorbed into poverty.

The rich get richer because through economic crises, they consolidate  their businesses and receive tax breaks and incentives from the state  (as well as often direct infusions of cash investments – bailouts – from  the state), purportedly to increase private capital and production.  This aspect of “fiscal austerity” is undertaken in the wider context of  what is referred to as “Structural Adjustment.”

This term refers to the loans from the World Bank and IMF that began  in the late 1970s and early 1980s in their lending to ‘Third World’  nations in the midst of the 1980s debt crisis. Referred to as  “Structural Adjustment Programs,” (SAPs) any nation wanting a loan from  the World Bank or IMF needed to sign a SAP, which set out a long list of  ‘conditionalities’ for the loan. These conditions included,  principally, “fiscal austerity measures” – cutting social spending and  raising taxes – but also a variety of other measures: liberalization of  markets (eliminating any trade barriers, subsidies, tariffs, etc.),  supposedly to encourage foreign investment which it was theorized would  increase revenue to pay off the debt and revive the economy;  privatization (privatizing all state-owned industries), in order to cut  state spending and encourage foreign direct investment (FDI), which  again – in theory – would create revenue and reduce debt; currency  devaluation (which would make foreign dollars buy more for less), again,  under the aegis of encouraging investment by making it cheaper for  foreign companies to buy assets within the country.

However, the effects that these ‘structural adjustment programs’ had  were devastating. Liberalizing markets would eliminate subsidies and  protections which were desperately needed in order for these  ‘developing’ nations to compete with the industrialized powers of  America and Europe (who, in a twisted irony, heavily subsidize their  agriculture in order to make it cheaper to foreign markets). For  example, a small country in Africa which was dependent upon a particular  agricultural export had heavily subsidized this commodity, (which keeps  the price low and thus increases its demand as an exported commodity),  then was ordered by the IMF and World Bank to eliminate the subsidy. The  effect was that foreign agricultural imports, say from the United  States or Europe, were cheaper not only in the international market, but  also in the nation’s domestic market. Thus, grains imported from  America would be cheaper than those grown in neighbouring fields. The  effect this had in an increasingly-impoverished nation was that they  would become dependent upon foreign imports for food and agriculture (as  well as other commodities), while the domestic industries would suffer  and be bought out by foreign multinational corporations, thus increasing  poverty, as many of these nations were heavily dependent upon their  agricultural sectors as they were often still largely rural societies in  some respects. This would accelerate urbanization and urban poverty, as  people leave the countryside and head to the cities looking for work,  where there was none.

Privatization, for its part, would eliminate state-owned industries,  which in many developing nations of the post-World War II era, were the  major employers of the population. Thus, massive unemployment would  result. As foreign multinational corporations – largely American or  European – would come in and buy up the domestic industries, they would  often cooperate with the dominant domestic corporations and banks – or  create domestic subsidiaries of their own – and consolidate the markets  and industries. Thus, the effect would be to strengthen a domestic elite  and entrench an oligarchy in the nation. The rich would get richer,  profiting off of their cooperation and integration with the  international economic system, and they would then come to rely  ever-more on the state for protection from the masses.

The devaluation of currencies would, while making commodities and  investments cheaper for foreign multinationals and banks, simultaneously  make it so that for the domestic population, it would require more  money to buy less products than before. This is called inflation, and is  particularly brutal in the case of buying food and fuel. For a  population whose wages are frozen (as a requirement of ‘fiscal  austerity’), their income (for those that have an income) does not  adjust to the rate of inflation, hence, they make the same dollar amount  even though the dollar is worth much less than before. The result is  that their income purchases much less than it used to, increasing  poverty.

This is ‘Structural Adjustment.’ This is ‘fiscal austerity.’ This is social genocide.

Debt and Derivatives

Greece has a total debt of roughly 330 billion euros (or U.S. $473  billion).[2] So how did this debt get out of control? As it turned out,  major U.S. banks, specifically J.P. Morgan Chase and Goldman Sachs,  “helped the Greek government to mask the true extent of its deficit with  the help of a derivatives deal that legally circumvented the EU  Maastricht deficit rules.” The deficit rules in place would slap major  fines on euro member states that exceeded the limit for the budget  deficit of 3% of GDP (gross domestic product), and that the total  government debt must not exceed 60% of GDP.  Greece hid its debt through  “creative accounting,” and in some cases, even left out huge military  expenditures. While the Greek government pursued its “creative  accounting” methods, it got more help from Wall Street starting in 2002,  in which “various investment banks offered complex financial products  with which governments could push part of their liabilities into the  future.” Put simply, with the help of Goldman Sachs and JP Morgan Chase,  Greece was able to hide its debt in the future by transferring it into  derivatives. A large deal was signed with Goldman Sachs in 2002  involving derivatives, specifically, cross-currency swaps, “in which  government debt issued in dollars and yen was swapped for euro debt for a  certain period — to be exchanged back into the original currencies at a  later date.” The banks helped Greece devise a cross-currency swap  scheme in which they used fictional exchange rates, allowing Greece to  swap currencies and debt for an additional credit of $1 billion.  Disguised as a ‘swap,’ this credit did not show up in the government’s  debt statistics. As one German derivatives dealer has stated, “The  Maastricht rules can be circumvented quite legally through swaps.”[3]

In the same way that homeowners take out a second mortgage to pay off  their credit card debt, Goldman Sachs and JP Morgan Chase and other  U.S. banks helped push government debt far into the future through the  derivatives market. This was done in Greece, Italy, and likely several  other euro-zone countries as well. In several dozen deals in Europe,  “banks provided cash upfront in return for government payments in the  future, with those liabilities then left off the books.” Because the  deals are not listed as loans, they are not listed as debt  (liabilities), and so the true debt of Greece and other euro-zone  countries was and likely to a large degree remains hidden. Greece  effectively mortgaged its airports and highways to the major banks in  order to get cash up-front and keep the loans off the books, classifying  them as transactions.[4]

Further, while Goldman Sachs was helping Greece hide its debt from  the official statistics, it was also hedging its bets through buying  insurance on Greek debt as well as using other derivatives trades to  protect itself against a potential Greek default on its debt. So while  Goldman Sachs engaged in long-term trades with Greek debt (meaning  Greece would owe Goldman Sachs a great deal down the line), the firm  simultaneously was betting against Greek debt in the short-term,  profiting from the Greek debt crisis that it helped create.[5]

This is not an unusual tactic for the company to engage in. As a  two-year Senate investigation into Goldman Sachs revealed in April of  2011, “Goldman Sachs Group Inc. profited from the financial crisis by  betting billions against the subprime mortgage market, then deceived  investors and Congress about the firm’s conduct.”[6] In 2007, as the  housing crisis was gaining momentum, Goldman Sachs executives sent  emails to each other explaining that they were making “some serious  money” by betting against the housing market, a giant bubble which they  and other Wall Street firms had helped create. So while the bank had a  large exposure (risk) in the housing market, by holding significant  derivatives in trading mortgages (mortgage-backed securities,  collateralized debt obligations, credit default swaps, etc.), the same  bank also used the derivatives market to bet against the housing market  as it crashed – a type of self-fulfilling prophecy – which further drove  the market down (as speculation does), and thus, Goldman Sachs profited  from the crisis it created and made worse.[7]

The derivatives market is a very important feature not only in the  housing bubble and bust of 2008, but also in the current Greek crisis,  and will remain an important facet of the unfolding global debt crisis.  The current global derivatives market was developed in the 1990s.  Derivatives are referred to as “complex financial instruments” in which  they are traded between two parties and their value is derived (hence:  “deriv-ative”) from some other entity, be it a commodity, stock, debt,  currency or mortgage, to name a few. There are several types of  derivatives. One example is a ‘put option,’ which is betting that a  particular stock, commodity or other asset will fall in price over the  short term; that way, those who purchase put options will profit from  the fall in prices of the asset bet on.

Who Built the Bubble?

One of the most common derivatives is a credit default swap (CDS).  These ‘financial instruments’ were developed by JP Morgan Chase in 1994  as a sort of insurance policy. The aim, as JP Morgan at the time had  tens of billions of dollars on the books as loans to corporations and  foreign governments, was to trade the debt to a third party (who would  take on the risk), and would then receive payments from the bank; thus,  JP Morgan would be able to remove the risk from its books, freeing up  its reserves to make more loans. JP Morgan was the first bank to make it  big on credit default swaps, opening the first credit default swaps  desk in New York in 1997, “a division that would eventually earn the  name ‘the Morgan Mafia’ for the number of former members who went on to  senior positions at global banks and hedge funds.” The credit default  swaps played a large part in the housing boom:

As the Federal Reserve cut interest rates and Americans  started buying homes in record numbers, mortgage-backed securities  became the hot new investment. Mortgages were pooled together, and  sliced and diced into bonds that were bought by just about every  financial institution imaginable: investment banks, commercial banks,  hedge funds, pension funds. For many of those mortgage-backed  securities, credit default swaps were taken out to protect against  default.[8]

Of course, there were a great many players in the financial crisis:  bankers, economists, politicians, regulators, etc. The confusion of the  situation has allowed all those who are culpable to point the finger at  one another and place blame on each other. For example, Jamie Dimon, CEO  of JPMorganChase, referred to the government-chartered mortgage lending  companies, Fannie Mae and Freddie Mac, as “the biggest disasters of all  time,” blaming them for encouraging the banks to make the bad loans in  the first place.[9] Of course, he had an ulterior motive in removing  blame from himself and the other banks.

There is, however, some truth to his contention, but the situation is  more complex. Fannie Mae was created in 1938 after the Great Depression  to provide local banks with federal money in order to finance home  mortgages with an aim to increase home ownership. In 1968, Fannie Mae  was transformed into a publicly held corporation, and in 1970, the  government created Freddie Mac to compete with Fannie Mae in providing  home mortgages. In 1992, President George H.W. Bush signed the Housing  and Community Development Act of 1992, which included amendments to the  charters of Fannie Mae and Freddie Mac, stating that they “have an  affirmative obligation to facilitate the financing of affordable housing  for low- and moderate-income families.”[10]

In 1992, the U.S. Department of Housing and Urban Development (HUD)  subsequently became the ‘regulator’ of Fannie Mae and Freddie Mac. In  1995, Bill Clinton’s HUD “agreed to let Fannie and Freddie get  affordable-housing credit for buying subprime securities that included  loans to low-income borrowers.”[11] In 1996, HUD “gave Fannie and  Freddie an explicit target — 42% of their mortgage financing had to go  to borrowers with income below the median in their area.”[12] In a 1999  article in the New York Times, it was reported that, “the Fannie Mae  Corporation is easing the credit requirements on loans that it will  purchase from banks and other lenders.” The action, reported the Times,  “will encourage those banks to extend home mortgages to individuals  whose credit is generally not good enough to qualify for conventional  loans.” It began in 1999 as a pilot program involving 24 banks in 15  markets (including New York), and had hoped to make it nationwide by  Spring 2000. The article went on:

Fannie Mae, the nation’s biggest underwriter of home  mortgages, has been under increasing pressure from the Clinton  Administration to expand mortgage loans among low and moderate income  people and felt pressure from stock holders to maintain its phenomenal  growth in profits.

In addition, banks, thrift institutions and mortgage companies have  been pressing Fannie Mae to help them make more loans to so-called  subprime borrowers. These borrowers whose incomes, credit ratings and  savings are not good enough to qualify for conventional loans, can only  get loans from finance companies that charge much higher interest rates —  anywhere from three to four percentage points higher than conventional  loans.[13]

The loans going to low-income households increased the rate given to  African Americans, as in the conventional loan market, black borrowers  accounted for 5% of loans, whereas in the subprime market, they  accounted for 18% of loans. The article itself warned that Fannie Mae  “may run into trouble in an economic downturn, prompting a government  rescue.”[14] In 2000, as housing prices increased, the U.S. Department  of Housing and Urban Development (HUD), under Bill Clinton, continued to  encourage loans to low-income borrowers.

Just in time, the Federal Reserve (the central bank of the United  States) dramatically lowered interest rates and kept them artificially  low in order to encourage the lending by mortgage lenders and banks, and  to encourage borrowing by low-income individuals and families,  essentially lulling them into a false sense of security. This ‘easy  money’ flowing from the Federal Reserve’s low interest rates and  printing press (as the Fed is responsible for the amount of money pumped  into the U.S. economy), oiled the wheels of the mortgage lenders and  the banks that were making bad loans to high-risk individuals. In the  1990s, the Federal Reserve under Chairman Alan Greenspan had created the  dot-com bubble, which burst (as all bubbles do), and subsequently, in  order to avoid a deep recession, Greenspan and the Federal Reserve  actively inflated the housing bubble. So, with the dot-com bubble  bursting in 2000 (brought to you by Alan Greenspan and the Federal  Reserve), Greenspan’s Fed then cut interest rates to historic lows and  began pumping out money in order to prevent a downward spiral of the  economy, which would later prove to be inevitable. This also encouraged  rabid speculation in the derivatives market, in particular by hedge  funds, managing money from banks, who engaged in high-risk trades taking  advantage of the uniquely low interest rates in order to purchase  derivatives which provide more long-term gains, further fuelling a  massive speculative bubble.[15]

Transcripts from a 2004 meeting of Federal Reserve officials revealed  a debate about whether there was an inflating housing bubble, at which  Greenspan stated that dissent should be kept secret so that the debate  does not reach a wider audience (i.e., the ‘public’). As he stated, “We  run the risk, by laying out the pros and cons of a particular argument,  of inducing people to join in on the debate, and in this regard it is  possible to lose control of a process that only we fully  understand.”[16] In 2005, the Fed officials were openly acknowledging  the existence of a bubble, but continued with their policies all the  same.[17] In 2005, Alan Greenspan left the Fed to be replaced by Ben  Bernanke, who that year told Congress that there was no housing bubble,  and that the increases in hosuing prices “largely reflect strong  economic fundamentals.”[18]

The bubble was fuelled in a number of ways. The Federal Reserve kept  the interest rates at historic lows, which encouraged both lending and  borrowing. The Fed also pumped large amounts of money into the economy  for the purpose of lending and borrowing. The government-sponsored  mortgage companies of Freddie Mac and Fannie Mae encouraged the banks to  make bad loans to high-risk individuals (and provided significant funds  to do so). The banks, all too happy to make bad loans to high-risk  borrowers, then used the derivatives market they created to profit off  of those loans (and further inflate the bubble), through trading  primarily Credit Default Swaps (CDS). As the Fed’s long-term interest  rates were kept artificially low, the banks speculated through the  derivatives market that the housing market would continue to grow apace,  and massive amounts of speculative money flowed into the housing  bubble, which itself further increased confidence of banks and mortgage  companies to lend, as well as individuals to borrow. Of course, the  reality was that the individuals were high-risk for a reason: because  they couldn’t afford to pay. Thus, it was an inevitable result that this  massive and ever-increasing bubble built on nothing but bank-created  and government-sponsored ‘faith’ was destined to burst.

Of course, when the bubble burst, the major banks were in a unique  position to profit immensely from the collapse through speculation, and  then, of course, repossess everyone’s homes. In order for financial  speculation to be such a menace in the global economy as it is today,  the Clinton administration took the bold steps necessary to eradicate  the barriers to such destructive financial practices and facilitate the  rapid and unregulated growth of the derivatives market. This was termed  the “financialization” of the U.S. economy, and de facto, much of the  global economy.

The Glass-Steagall Act was put in place by FDR in 1933 in order to  establish a barrier between investment banks and commercial banks and to  prevent them from engaging in rabid speculative practices (a major  factor which created the Great Depression). However, in 1987, the  Federal Reserve Board voted to ease many regulations under the act,  after hearing “proposals from Citicorp, J.P. Morgan and Bankers Trust  advocating the loosening of Glass-Steagall restrictions to allow banks  to handle several underwriting businesses, including commercial paper,  municipal revenue bonds, and mortgage-backed securities.” Alan  Greenspan, in 1987, “formerly a director of J.P. Morgan and a proponent  of banking deregulation – [became] chairman of the Federal Reserve  Board.” In 1989, “the Fed Board approve[d] an application by J.P.  Morgan, Chase Manhattan, Bankers Trust, and Citicorp to expand the  Glass-Steagall loophole to include dealing in debt and equity securities  in addition to municipal securities and commercial paper.” In 1990,  “J.P. Morgan [became] the first bank to receive permission from the  Federal Reserve to underwrite securities.”[19]

In 1998, the House of Representatives passed “legislation by a vote  of 214 to 213 that allow[ed] for the merging of banks, securities firms,  and insurance companies into huge financial conglomerates.” And in  1999, “After 12 attempts in 25 years, Congress finally repeal[ed]  Glass-Steagall, rewarding financial companies for more than 20 years and  $300 million worth of lobbying efforts.”[20]

[In] the late 1990s, with the stock market surging to  unimaginable heights, large banks [were] merging with and swallowing up  smaller banks, and a huge increase in banks having transnational  branches, Wall Street and its many friends in congress wanted to  eliminate the regulations that had been intended to protect investors  and stabilize the financial system. Hence the Gramm-Leach-Bliley Act of  1999 repealed key parts of Glass-Steagall and the Bank Holding Act and  allowed commercial and investment banks to merge, to offer home mortgage  loans, sell securities and stocks, and offer insurance.[21]

The principal adherents for the repeal of Glass-Steagle were Alan  Greenspan, as well as Treasury Secretary Robert Rubin (who had been with  Goldman Sachs for 26 years prior to entering the Treasury), and Deputy  Treasury Secretary Larry Summers (who was previously the Chief Economist  of the World Bank). After largely orchestrating the removal of  Glass-Steagle, Rubin went on to become an executive at Citigroup and is  currently the Co-Chairman of the Council on Foreign Relations; while  Summers went on to become President of Harvard University and later,  served as Director of the White House National Economic Council for the  first couple years of the Obama administration. Larry Summers had  sparked controversy when he was Chief Economist of the World Bank, and  in 1991, signed a memo in which he endorsed toxic waste dumping in poor  African countries, stating, “A given amount of health-impairing  pollution should be done in the country with the lowest cost, which will  be the country with the lowest wages,” and further, “I think the  economic logic behind dumping a load of toxic waste in the lowest-wage  country is impeccable and we should face up to that.”[22] The  “impeccable logic” Summers referred to was the notion that in countries  with the lowest life expectancy, dumping toxic waste is intelligent,  because statistically speaking, the population of the country is more  likely to die before the long-term health impacts of the toxic waste  take effect. Put more bluntly: the poor should be the first to die.

The most prestigious (and arguably most powerful) financial  institution in the world is the Bank for International Settlements  (BIS). One might say it’s the most powerful institution you never heard  of, since it is rarely discussed, even more rarely studied, and barely  understood at all. It is, essentially, a global central bank for the  world’s central banks, and de facto acts as an independent global  banking supervisory body, establishing agreements for the practices of  central banks and private banks. In 2004, the BIS established the Basel  II accords to manage capital risk by banks. Basel II was “intended to  keep banks safe by requiring them to match the size of their capital  cushion to the riskiness of their loans and securities. The higher the  odds of default, the less they can lend.” However, as the regulations  were being implemented in 2008 in the midst of the financial crisis, it  lessened the ability of banks to lend, and thus, deepened the financial  crisis itself.[23] The BIS, formed in 1930 in the wake of the Great  Depression, was created in order to “remedy the decline of London as the  world’s financial center by providing a mechanism by which a world with  three chief financial centers in London, New York, and Paris could  still operate as one.” As historian Carroll Quigley wrote:

[T]he powers of financial capitalism had another  far-reaching aim, nothing less than to create a world system of  financial control in private hands able  to dominate the political  system of each country and the economy of the world as a whole. This  system was to be controlled in a feudalist fashion by the central banks  of the world acting in concert, by secret agreements arrived at in  frequent private meetings and conferences. The apex of the system was to  be the Bank for International Settlements in Basle, Switzerland, a  private bank owned and controlled by the world’s central banks which  were themselves private corporations.[24]

In 2007, the BIS released its annual report warning that the world  was on the verge of another Great Depression, as “years of loose  monetary policy has fuelled a dangerous credit bubble, leaving the  global economy more vulnerable to another 1930s-style slump than  generally understood.” Among the worrying signs cited by the BIS were  “mass issuance of new-fangled credit instruments, soaring levels of  household debt, extreme appetite for risk shown by investors, and  entrenched imbalances in the world currency system.” The BIS hinted at  the U.S. Federal Reserve when it warned that, “central banks were  starting to doubt the wisdom of letting asset bubbles build up on the  assumption that they could safely be ‘cleaned up’ afterwards.”[25]

In 2008, the outgoing Chief Economist of the BIS, William White,  authored the annual report of the BIS in which he again warned that,  “The current market turmoil is without precedent in the postwar period.  With a significant risk of recession in the US, compounded by sharply  rising inflation in many countries, fears are building that the global  economy might be at some kind of tipping point.” In 2007, warned the  BIS, global banks had $37 trillion of loans, equaling roughly 70% of  global GDP, and that countries were already so indebted that  monetization (printing money) could simply sow the seeds of a future  crisis.[26]

Bailout the Bankers, Punish the People

In the fall of 2008, the Bush administration sought to implement a  bailout package for the economy, designed to save the US banking system.  The leaders of the nation went into rabid fear mongering. Advertising  the bailout as a $700 billion program, the fine print revealed a more  accurate description, saying that $700 billion could be lent out “at any  one time.” As Chris Martenson wrote:

This means that $700 billion is NOT the cost of this  dangerous legislation, it is only the amount that can be outstanding at  any one time.  After, say, $100 billion of bad mortgages are disposed  of, another $100 billion can be bought.  In short, these four little  words assure that there is NO LIMIT to the potential size of this  bailout. This means that $700 billion is a rolling amount, not a  ceiling.

So what happens when you have vague language and an unlimited  budget?  Fraud and self-dealing.  Mark my words, this is the largest  looting operation ever in the history of the US, and it’s all spelled  out right in this delightfully brief document that is about to be rammed  through a scared Congress and made into law.[27]

Further, as the bailout agreement stipulated, it essentially hands  the Federal Reserve and the U.S. Treasury total control over the  nation’s finances in what has been termed a “financial coup d’état” as  all actions and decisions by the Fed and the Treasury Secretary may be  done in secret and are not able to be reviewed by Congress or any other  administrative or legal agency.[28] Passed in the last months of the  Bush administration, the Obama administration further implemented the  bailout (and added a stimulus package on top of it).

The banks got a massive bailout of untold trillions, and they were  simultaneously consolidating the industry and merging with one another.  In 2008, with the collapse of Bear Stearns, JP Morgan Chase bought the  failed bank with funds in an agreement organized by the Federal Reserve  Bank of New York, whose President at the time was Timothy Geithner (who  would go on to become Obama’s Treasury Secretary, managing the major  bailout program). As JPMorganChase was the ultimate benefactor of the  Bear Stearns purchase by the NYFed, it is perhaps no small coincidence  that Jamie Dimon, CEO of JPMorganChase, was on the board of the New York  Fed, a privately-owned bank, of which JPMorganChase is itself a major  shareholder. JPMorganChase later absorbed Washington Mutual, one of the  nation’s largest banks prior to the crisis; Bank of America bought  Merrill Lynch; Wells Fargo bought Wachovia; and a host of other mergers  and acquisitions took place. Thus, the “too big to fail” banks became  much bigger and more dangerous than ever before.

Among the many recipients of bailout funds (officially referred to as  the Troubled Asset Relief Program – TARP), were Fannie Mae, AIG  (insurance), Freddie Mac, General Motors, Bank of America, Citigroup,  JPMorgan Chase, Wells Fargo, Goldman Sachs, Morgan Stanley, and hundreds  of others.[29] As the Federal Reserve dished out trillions of dollars  in bailouts to banks, many European banks even became recipients of  American taxpayer-funded bailouts, including Barclays, UBS, the Royal  Bank of Scotland, and Société Générale, among many others.[30] The  Federal Reserve bailout of American insurance giant AIG was actually a  stealth bailout of foreign banks, as the money went through AIG to the  major European banks that had significant risks with AIG, including  Société Générale of France, UBS of Belgium, Barclays of the U.K., and  Deutsche Bank of Germany.[31] In total, the multi-billion dollar bailout  of AIG in 2008 benefited roughly 87 banks and financial institutions,  43 of which were foreign, primarily located in France and Germany, but  also in the U.K., Canada, the Netherlands, Denmark, and Switzerland, and  on the domestic side much of the funds went to Goldman Sachs, JPMorgan  Chase, and Bank of America.[32]

Neil Barofsky, who was until recently, the special inspector general  for the TARP bailout program – the individual responsible for attempting  to engage in oversight of a secret bailout program – wrote an article  for the New York Times upon his resignation from the position in March  of 2011, in which he stated that he “strongly disagrees” that the  program was successful, saying that:

billions of dollars in taxpayer money allowed  institutions that were on the brink of collapse not only to survive but  even to flourish. These banks now enjoy record profits and the seemingly  permanent competitive advantage that accompanies being deemed “too big  to fail.”[33]

In June of 2009, as governments around the world were implementing  stimulus packages and bailouts to save the banks and ‘rescue’ their  economies, the Bank for International Settlements (BIS) issued a new  round of warnings about the state of the global economy. Among them, the  BIS warned that, “governments and central banks must not let up in  their efforts to revive the global banking system, even if public  opinion turns against them,” and that the BIS felt that there had only  been “limited progress” in reviving the banking system. The BIS  continued:

Instead of implementing policies designed to clean up  banks’ balance sheets, some rescue plans have pushed banks to maintain  their lending practices of the past, or even increase domestic credit  where it’s not warranted… The lack of progress threatens to prolong the  crisis and delay the recovery because a dysfunctional financial system  reduces the ability of monetary and fiscal actions to stimulate the  economy… without a solid banking system underpinning financial markets,  stimulus measures won’t be able to gain traction, and may only lead to a  temporary pickup in growth.[34]

Further, the BIS warned, “A fleeting recovery could well make matters  worse,” as “further government support for banks is absolutely  necessary, but will become unpopular if the public sees a recovery in  hand. And authorities may get distracted with sustaining credit, asset  prices and demand rather than focusing on fixing bank balance sheets.”  The BIS concluded that all the various measures to revive the global  economy leave an “open question” as to whether or not they will be  successful, and specifically, “as governments bulk up their deficits to  spend their way out of the crisis, they need to be careful that their  lack of restraint doesn’t come back to bite them.” As the annual report  warned, “Getting public finances in order will therefore be the main  task of policy makers for years to come.”[35]

The BIS further warned that, “there’s a risk central banks will raise  interest rates and withdraw emergency liquidity too late, triggering  inflation,” as history shows policy-makers “have a tendency to be late,  tightening financial conditions slowly for fear of doing it prematurely  or too severely.” As Bloomberg reported:

Central banks around the globe have lowered borrowing  costs to record lows and injected billions of dollars into the financial  system to counter the worst recession since World War II. While some  policy makers have stressed the need to withdraw the emergency measures  as soon as the economy improves, the Federal Reserve, Bank of England,  and European Central Bank are still in the process of implementing  asset-purchase programs designed to unblock credit markets and revive  growth.

“The big and justifiable worry is that, before it can be reversed,  the dramatic easing in monetary policy will translate into growth in the  broader monetary and credit aggregates,” the BIS said. That will “lead  to inflation that feeds inflation expectations or it may fuel yet  another asset-price bubble, sowing the seeds of the next financial  boom-bust cycle.”[36]

The BIS report stated that the unprecedented policies of central  banks “may be insufficient to put the economy on the path to recovery,”  stressing that there was a “significant risk” that the monetary and  fiscal stimulus of governments will only lead to “a temporary pickup in  growth, followed by a protracted stagnation.”[37]

William White, the former Chief Economist of the BIS, warned in  September of 2009 that, “the world has not tackled the problems at the  heart of the economic downturn and is likely to slip back into  recession,” and he “also warned that government actions to help the  economy in the short run may be sowing the seeds for future crises.”  White, who accurately predicted the global financial crisis in 2008,  stated that we are “almost certainly” going into a double-dip recession  and “would not be in the slightest bit surprised” if we were to go into a  protracted stagnation. He added: “The only thing that would really  surprise me is a rapid and sustainable recovery from the position we’re  in.” White, a Canadian economist who ran the economic department at the  BIS from 1995 until 2008, had “warned of dangerous imbalances in the  global financial system as far back as 2003 and – breaking a great taboo  in central banking circles at the time – he dared to challenge Alan  Greenspan, then chairman of the Federal Reserve, over his policy of  persistent cheap money.” As the Financial Times reported in 2009:

Worldwide, central banks have pumped thousands of  billions [i.e., trillions] of dollars of new money into the financial  system over the past two years in an effort to prevent a depression.  Meanwhile, governments have gone to similar extremes, taking on vast  sums of debt to prop up industries from banking to car making.

These measures may already be inflating a bubble in asset prices,  from equities to commodities, [White] said, and there was a small risk  that inflation would get out of control over the medium term if central  banks miss-time their “exist strategies”.

Meanwhile, the underlying problems in the global economy, such as  unsustainable trade imbalances between the US, Europe and Asia, had not  been resolved, he said.[38]

William White further warned that, “we now have a set of banks that  are even bigger – and more dangerous – than ever before.” Simon Johnson,  former Chief Economist of the IMF, also warned that the finance  industry had effectively captured the US government and that “recovery  will fail unless we break the financial oligarchy that is blocking  essential reform.”[39]

In 2009, the BIS warned that the market for derivatives still poses  “major systemic risks” to the financial system, standing at a total  value of $426 trillion (more than the worth of the entire global economy  combined) and that, “the use of derivatives by hedge funds and the like  can create large, hidden exposures.”[40] In 2010, one independent  observer estimated the derivatives market was at roughly $700  trillion.[41] The Bank for International Settlements estimated the  market value at $600 trillion in December 2010.[42] In June of 2011, the  BIS warned that, “the world’s top 14 derivatives dealers may need extra  cash to handle a surge in transaction clearing, especially in choppy  markets,” as “world leaders have agreed that chunks of the $600 trillion  off-exchange derivatives market must be standardized and cleared by the  end of 2012 to broaden transparency and curb risk.” The major  institutions that the BIS identified as in need of more funds to handle  their derivatives exposure are Bank of America-Merrill Lynch, Barclays  Capital, BNP Paribas, Citi, Credit Suisse, Deutsche Bank, Goldman Sachs,  HSBC, JP Morgan Chase, Morgan Stanley, RBS, Société Générale, UBS, and  Wells Fargo Bank.[43]

In January of 2011, Barofsky, while still Special Inspector General  of the TARP bailout program, issued a report which warned that future  bailouts of major banks could be “a necessity,” and that, “the  government still had not developed objective criteria to measure the  amount of systemic risk posed by giant financial companies.”[44] In an  interview with NPR, Barofsky stated:

The problem is that the notion of too big to fail – these  large financial institutions that were just too big to allow them to go  under – since the 2008 bailouts, they’ve only gotten bigger and bigger,  more concentrated, larger in size. And what’s really discouraging is  that if you look at how the market treats them, it treats them as if  they’re going to get a government bailout, which destroys market  discipline and really puts us in a very dangerous place.[45]

In June of 2011, Barofsky stated in an interview with Dan Rather that  the next crisis may cost $5 trillion, and told Rather, “You should be  scared, I’m scared,” and that a coming crisis is inevitable.[46]

Even though the bailouts have already cost the U.S. taxpayers several  trillion dollars (which they will pay for through the decimation of  their living standards), the IMF in October of 2010 warned that within  the coming 24 months (up to Fall 2012), global banks face a $4 trillion  refinancing crisis, and that, “governments will have to inject fresh  equity into banks – particularly in Spain, Germany and the US – as well  as prop up their funding structures by extending emergency support.” The  IMF Global Financial Stability Report stated that, “the global  financial system is still in a period of significant uncertainty and  remains the Achilles’ heel of the economic recovery.” This is especially  significant considering that the debts that banks needed to write off  between 2007 and 2010 sat at $2.2 trillion, and that benchmark hadn’t  even been achieved. Thus, with nearly double that amount needing to be  written off in an even shorter time span, it would seem inevitable that  the banks will need a massive bailout as “nearly $4 trillion of bank  debt will need to be rolled over in the next 24 months.” Further, warned  the IMF, “Planned exit strategies from unconventional monetary and  financial support may need to be delayed until the situation is more  robust, especially in Europe… With the situation still fragile, some of  the public support that has been given to banks in recent years will  have to be continued.”[47]

In other words, “exit strategies,” meaning harsh draconian austerity  measures may need to be delayed in order to give enough time to  undertake bailouts of major banks. After all, engineering trillion  dollar bailouts of large financial institutions which created a massive  global crisis is hard to do at the same time as punishing an entire  population through destruction of their living standards and general  impoverishment in order to pay off the debt already incurred by  governments (which through bailouts essentially ‘buy’ the bad debts of  the banks, and hand the taxpayers the bill).

So while many say that the banks need another bailout, one must  question whether the first bailout was necessary, as it simply allowed  the banks to get bigger, take more risks, and essentially get a  government guarantee of future bailouts (not to mention, the massive  fraud and illegalities that took place through the bailout mechanism).  However, several top economists and financial experts have pointed out  that the “too big to fail” banks are actually the largest threat to the  economy, and that they are more accurately “too big to exist,”  explaining that recovery cannot take place unless they are broken up.  Nobel Prize winning economist and former Chief Economist of the World  Bank, Joseph Stiglitz, along with former Chief Economist of the IMF,  Simon Johnson, both warned Congress that propping up the banks is  preventing recovery from taking place. Even the President of the Federal  Reserve Bank of Kansas stated that, “policymakers must allow troubled  firms to fail rather than propping them up.”[48]

The true aim of the bailouts was to prevent the major banks of the  world (all of which are insolvent – unable to pay debts) from collapsing  under the weight of their own hubris, and to effectively employ the  largest transfer of wealth in human history from major nations  (taxpayers) to the bankers and their shareholders. The true cost of the  bailouts, a far cry from the IMF’s statement of a couple trillion  dollars, was in the tens of trillions. The Federal Reserve itself bailed  out the financial industry for over $9 trillion, with $2 trillion going  to Merrill-Lynch (which was subsequently acquired by Bank of America),  $2 trillion going to Morgan Stanley, $2 trillion going to Citigroup, and  less than $1 trillion each for Bear Stearns (which was acquired by  JPMorgan Chase), Bank of America, and Goldman Sachs. These details were  released by the Federal Reserve and cover 21,000 separate transactions  between December 2007 and July of 2010.[49]

The Federal Reserve also undertook a massive bailout of foreign  central banks. During the financial crisis, the Fed established a  lending program of shipping US dollars overseas through the European  Central Bank, the Bank of England, and the Swiss National Bank (among  others), and “the central banks, in turn, lent the dollars out to banks  in their home countries in need of dollar funding.”[50] The overall  bailouts, including those not undertaken by the Fed specifically, but  government-implemented, reach roughly $19 trillion, with $17.5 trillion  of that going to Wall Street.[51] No surprise there, considering that  Neil Barofsky had warned in July of 2009 that the bailout could cost  taxpayers as much as $23.7 trillion dollars.[52]

The Federal Reserve Represents the Banks

In February of 2010, the Federal Reserve announced that it would be  investigating the role of U.S. banks in Greece’s debt crisis.[53]  However, the Washington Post article which reported on the Fed’s  ‘investigation’ failed to mention the ‘slight’ conflicts of interest,  which essentially have the fox guarding the hen house. What am I  referring to? The Federal Reserve System is a quasi-governmental entity,  with a national Board of Governors based in Washington, D.C., with the  Chairman appointed by the President. Alan Greenspan, one of the  longest-serving Federal Reserve Chairmen in its history, was asked in a  2007 interview, “What is the proper relationship – what should be the  proper relationship between a Chairman of the Fed and the President of  the United States?” Greenspan replied:

Well, first of all, the Federal Reserve is an independent  agency, and that means basically that there is no other agency of  government which can over-rule actions that we take. So long as that is  in place and there is no evidence that the administration, or the  Congress, or anybody else is requesting that we do things other than  what we think is the appropriate thing, then what the relationships are  don’t frankly matter.[54]

Not only is the Federal Reserve unaccountable to the American  government, and thereby, the American people, but it is directly  accountable to and in fact, owned by the major American and global  banks. Thus, the notion that it would ‘investigate’ the illicit  activities of banks like Goldman Sachs and J.P. Morgan Chase is  laughable at best, and is more likely to resemble a criminal cover-up as  opposed to an ‘independent investigation.’

The Federal Reserve System is made up of 12 regional Federal Reserve  banks, which are themselves private banks, owned by shareholders, which  are made up of the principle banks in their region, who ‘select’ a  president to represent them and their interests. The most powerful of  these banks, unsurprisingly, is the Federal Reserve Bank of New York,  which represents the powerful banks of Wall Street. The current Treasury  Secretary, Timothy Geithner, was previously President of the Federal  Reserve Bank of New York, where he organized the specific bailouts of  AIG and JP Morgan’s purchase of Bear Stearns. The current president of  the New York Fed is William Dudley, who previously was a partner and  managing director at Goldman Sachs, and is also currently a member of  the board if directors of the Bank for International Settlements (BIS).  The current chairman of the board of the New York Fed is Lee Bollinger,  President of Columbia University, who is also on the board of directors  of the Washington Post Company. Until recently, Jeffrey R. Immelt was on  the board of directors of the New York Fed, while serving as CEO of  General Electric. However, he was more recently appointed by President  Obama to head his Economic Recovery Advisory Board, replacing former  Federal Reserve Chairman Paul Volcker. Another current member of the  board of directors of the New York Fed include Jamie Dimon, Chairman and  CEO of JP Morgan Chase.

Not only are the major banks represented at the Fed, but so too are  the major corporations, as evidenced by the recent board membership of  the CEO of General Electric (which incidentally received significant  funds from the bailouts organized by the Fed). However, the Fed also has  a number of advisory groups, such as the Community Affairs Advisory  Council, which was formed in 2009 and, according to the New York Fed’s  website, “meets three times a year at the New York Fed to share  ground-level intelligence on conditions in low- and moderate-income  (LMI) communities.” The members include individuals from senior  positions at Bank of America and Goldman Sachs.[55]

The Economic Advisory Panel is “a group of distinguished economists  from academia and the private sector [who] meet twice a year with the  New York Fed president to discuss the current state of the economy and  to present their views on monetary policy.” Among the institutions  represented through individual membership are: Harvard University,  Morgan Stanley, Deutsche Bank, Columbia University, American  International group (AIG), New York University, Carnegie Mellon  University, University of Chicago, and the Peter G. Peterson Institute  for International Economics.[56]

Perhaps one of the most important advisory groups is the  International Advisory Committee, “established in 1987 under the  sponsorship of the Federal Reserve Bank of New York to review and  discuss major issues of public policy concern with respect to principal  national and international capital markets.” The members include: Lloyd  C. Blankfein, Chairman and CEO of Goldman Sachs; William J. Brodsky,  Chairman and CEO of the Chicago Board Options Exchange (derivatives);  Stephen K. Green, Chairman of HSBC; Marie-Josée Kravis, Senior Fellow  and Member of the Board of Trustees of the Hudson Institute (and  longtime Bilderberg member); Sallie L. Krawcheck, President of Global  Wealth and Investment Management at Bank of America; Michel J.D.  Pebereau, Chairman of the Board of BNP Paribas; and Kurt F. Viermetz,  retired Vice Chairman of J.P. Morgan.[57]

Another group, the Fedwire Securities Customer Advisory Group,  consists of individuals from senior positions at JP Morgan Chase,  Citibank, The Bank of New York Mellon, Fannie Mae, Northern Trust, State  Street Bank and Trust Company, Freddie Mac, Federal Home Loan Banks,  the Depository Trust & Clearing Corporation, and the Assistant  Commissioner of the U.S. Department of the Treasury.[58] It is then made  painfully clear whose interests the Federal Reserve – and specifically  the Federal Reserve Bank of New York – serve. An article from Bloomberg  in January of 2010 analyzed the information that was revealed in a  Senate hearing regarding the secret bailout of AIG by the New York Fed,  which “described a secretive group deploying billions of dollars to  favored banks, operating with little oversight by the public or elected  officials.” As the author of the article wrote, “It’s as though the New  York Fed was a black-ops outfit for the nation’s central bank.”[59]

Who Benefits from the Greek Bailout?

Greece has a total debt of roughly 330 billion euros (or U.S. $473  billion).[60] In the lead-up to the Greek bailout orchestrated by the  IMF and European Union in 2010, the Bank for International Settlements  (BIS) released information regarding who exactly was in need of a  bailout. With the bailout largely organized by France and Germany (as  the dominant EU powers), who would be providing the majority of funds  for the bailout itself (subsequently charged to their taxpayers), the  BIS revealed that German and French banks carry a combined exposure of  $119 billion to Greek borrowers specifically, and more than $900 billion  to Greece, Spain, Portugal and Ireland combined. The French and German  banks account for roughly half of all European banks’ exposure to those  euro-zone countries, meaning that the combined exposure of European  banks to those four nations is over $1.8 trillion, nearly half of which  is with Spain alone. Thus, in the eyes of the elites and the  institutions which serve them (such as the EU and IMF), a bailout is  necessary because if Greece were to default on its debt, “investors may  question whether French and German banks could withstand the potential  losses, sparking a panic that could reverberate throughout the financial  system.”[61]

In late February of 2010, Greece replaced the head of the Greek debt  management agency with Petros Christodoulou. His job was “to procure  favorable loans in the financial markets so that Athens can at least pay  off its old debts with new debt.” His career went along an interesting  path, to say the least, as he studied finance in Athens and Columbia  University in New York, and went on to hold senior executive positions  at several financial institutions, such as Credit Suisse, Goldman Sachs,  JP Morgan, and just prior to heading the Public Debt Management Agency  (PDMA), he was treasurer at the National Bank of Greece.[62] Before his  12-year stint at the National Bank of Greece, the largest commercial  bank in Greece, he headed the derivatives desk at JP Morgan.[63]

In March of 2010, Greece passed a draconian austerity package in  order to qualify for a bailout from the IMF and EU, as they had  demanded. In April, Greece officially applied for an emergency loan, and  in May of 2010, the EU and the IMF agreed to a $146 billion loan after  Greece unveiled a new round of austerity measures (spending cuts and tax  hikes). While Greece had already imposed austerity measures in March to  even be considered for receivership of a loan, the EU and IMF demanded  that they impose new and harsher austerity measures as a condition of  the loan (just as the IMF and World Bank forced the ‘Third World’  nations to impose ‘Structural Adjustment Programs’ as a condition of  loans). As the Los Angeles Times wrote at the time:

In Greece, workers have been mounting furious protests  against the prospect of drastic government cuts. Officials are bracing  for a general strike Wednesday over the new austerity plan, which  includes higher fuel, tobacco, alcohol and sales taxes, cuts in military  spending and the elimination of two months’ annual bonus pay for civil  servants. Axing the bonus is a particularly fraught move in a country  where as many as one in four workers is employed by the state.[64]

The EU was set to provide 80 billion euros of the 110 billion euro  total, and the IMF was to provide the remaining 30 billion euros.[65]  Greece was broke, credit ratings agencies (CRAs) were downgrading  Greece’s credit worthiness (making it harder and more expensive for  Greece to borrow), banks were speculating against Greece’s ability to  repay its debt in the derivatives market, and the EU and IMF were  forcing the country to increase taxes and cut spending, impoverishing  and punishing its population for the bad debts of bankers and  politicians. However, in one area, spending continued.

While France and Germany were urging Greece to cut its spending on  social services and public sector employees (who account for 25% of the  workforce), they were bullying Greece behind the scenes to confirm  billions of euros in arms deals from France and Germany, including  submarines, a fleet of warships, helicopters and war planes. One Euro-MP  alleged that Angela Merkel and Nicolas Sarkozy blackmailed the Greek  Prime Minister by making the Franco-German contributions to the bailout  dependent upon the arms deals going through, which was signed by the  previous Greek Prime Minister. Sarkozy apparently told the Greek Prime  Minister Papandreou, “We’re going to raise the money to help you, but  you are going to have to continue to pay the arms contracts that we have  with you.” The arms deals run into the billions, with 2.5 billion euros  simply for French frigates.[66] Greece is in fact the largest purchaser  of arms (as a percentage of GDP) in the European Union, and was  planning to make more purchases:

Greece has said it needs 40 fighter jets, and both  Germany and France are vying for the contract: Germany wants Greece to  buy Eurofighter planes — made by a consortium of German, Italian,  Spanish and British companies — while France is eager to sell Athens its  Rafale fighter aircraft, produced by Dassault.

Germany is Greece’s largest supplier of arms, according to a report  published by the Stockholm International Peace Research Institute in  March, with Athens receiving 35 percent of the weapons it bought last  year from there. Germany sent 13 percent of its arms exports to Greece,  making Greece the second largest recipient behind Turkey, SIPRI  said.[67]

Thus, France and Germany insist upon French and German arms  manufacturers making money at the expense of the standard of living of  the Greek people. Financially extorting Greece to purchase weapons and  military equipment while demanding the country make spending cuts in all  other areas (while increasing the taxes on the population) reveals the  true hypocrisy of the whole endeavour, and the nature of who is really  being ‘bailed out.’

As Greece was risking default in April of 2010, the derivatives  market saw a surge in the trading of Credit Default Swaps (CDS) on  Greece, Portugal, and Spain, which increased the expectations of a  default, and acts as a self-fulfilling prophecy in making the debt more  severe and access to funding more difficult.[68] Thus, the very banks  that are owed the debt payments by Greece bet against Greece’s ability  to repay its debt (to them), and thus make it more difficult and urgent  for Greece to receive funds. In late April of 2010, Standard &  Poor’s (a major credit ratings agency – CRA) downgraded Greece’s credit  rating to “junk status,” and cut the rating of Portugal as well,  plunging both those nations into deeper crisis.[69] Thus, just at a time  when the countries were in greater need of funds than before, the  credit ratings agencies made it harder for them to borrow by making them  less attractive to lenders and investors. Investors wait for the  ratings given by CRAs before they make investment decisions or provide  credit, and thus they “wield enormous clout in the financial markets.”  There are only three major CRAs, Standard & Poor’s (S&P),  Moody’s, and Fitch. In relation to the S&P downgrading on Greece’s  rating, the Guardian reported:

S&P has effectively said it views Greece as a much  riskier place to invest, which increases the interest rate investors  will charge the Greek government to borrow money on the open market. But  S&P is also implying that the risk of Greece defaulting on its  loans has increased, a frightening prospect for bondholders and European  politicians.[70]

CRAs also have major conflicts of interest, since they are companies  in their own right, and receive funding and share leadership with  individuals and corporations who they are responsible for applying  credit-worthiness to. For example, Standard and Poor’s leadership  includes individuals who have previously worked for JP Morgan, Morgan  Stanley, Deutsche Bank, the Bank of New York, and a host of other  corporations.[71] Further, S&P is owned by The McGraw-Hill  Companies. The executives of McGraw-Hill include individuals past or  presently associated with: PepsiCo, General Electric, McKinsey &  Co., among others.[72] The Board of Directors includes: Pedro Aspe,  Co-Chairman of Evercore Partners, former Mexican Finance Minister and  director of the Carnegie Corporation; Sir Winfried Bischoff, the  Chairman of Lloyds Banking Group, former Chairman of Citigroup, former  Chairman of Schroders; Douglas N. Daft, former Chairman and CEO of the  Coca-Cola Company, a director of Wal-Mart, and is also a member of the  European Advisory Council for N.M. Rothschild & Sons Limited;  William D. Green, Chairman of Accenture; Hilda Ochoa-Brillembourg,  President and Chief Executive Officer of Strategic Investment Group,  formerly at the World Bank, a director of General Mills and the Atlantic  Council, and is an Advisory Board member of the Rockefeller Center for  Latin American Studies at Harvard University; Sir Michael Rake, Chairman  of British Telecom, and is on the board of Barclays; Edward B. Rust,  Jr., Chairman and CEO of State Farm Insurance Companies; among many  others.[73]

Moody’s is another of the major Credit Ratings Agencies. Its board of  directors includes individuals past or presently affiliated with:  Citigroup, the Federal Reserve Bank of Dallas, the Federal Reserve Bank  of New York, Barclays, Freddie Mac, ING Group, the Dutch National Bank,  and Pfizer, among many others.[74] The Executive team at Moody’s  includes individuals past or presently affiliated with: Citigroup, Bank  of America, Dow Jones & Company, U.S. Trust Company, Bankers Trust  Company, American Express, and Lehman Brothers, among many others.[75]

Fitch Ratings, the last of the big three CRAs, is owned by the Fitch  Group, which is itself a subsidiary of a French company, Fimalac. The  Chairman and CEO is Marc Ladreit de Lacharrière, who is a member of the  Consultative Committee of the Bank of France, and is also on the boards  of Renault, L’Oréal, Groupe Casino, Gilbert Coullier Productions,  Cassina, and Canal Plus. The board of directors includes Véronique  Morali, who is also a member of the board of Coca-Cola, and is a member  of the management board of La Compagnie Financière Edmond de Rothschild,  a private bank belonging to the Rothschild family. The board includes  individuals past or presently affiliated with: Barclays, Lazard Frères  & Co, JP Morgan, Bank of France, and HSBC, among many others.[76]

So clearly, with the immense number of bankers present on the boards  of the CRAs, they know whose interest they serve. The fact that they are  responsible not only for rating banks and other corporations (of which  the conflict of interest is obvious), but that they rate the  credit-worthiness of nations is also evident of a conflict, as these are  nations who owe the banks large sums of money. Thus, lowering their  ratings makes them more desperate for loans (and makes the loans more  expensive), since the nation is a less attractive investment, loans will  be given with higher interest rates, which means more future revenues  for the banks and other lenders. As the credit ratings are downgraded,  the urgency to pay interest on debt is more severe, as the nation risks  losing more investments and capital when it needs it most. To get a  better credit rating, it must pay its debt obligations to the foreign  banks. Thus, through Credit Ratings Agencies, the banks are able to help  strengthen a system of financial extortion, made all the more severe  through the use of derivatives speculation which often follows (or even  precedes) the downgraded ratings.

So while Greece received the bailout in order to pay interest to the  banks (primarily French and German) which own the Greek debt, the  country simply took on more debt (in the form of the bailout loan) for  which they will have to pay future interest fees. Of course, this would  also imply future bailouts and thus, continued and expanded austerity  measures. This is not simply a Greek crisis, this is indeed a European  and in fact, a global debt crisis in the making.

The Great Global Debt Depression

In March of 2010, prior to Greece receiving its first bailout, the  Bank for International Settlements (BIS) warned that, “sovereign debt is  already starting to cross the danger threshold in the United States,  Japan, Britain, and most of Western Europe, threatening to set off a  bond crisis at the heart of the global economy.” In a special report on  ‘sovereign debt’ written by the new chief economist of the BIS, Stephen  Cecchetti, the BIS warned that, “The aftermath of the financial crisis  is poised to bring a simmering fiscal problem in industrial economies to  the boiling point,” and further: “Drastic austerity measures will be  needed to head off a compound interest spiral, if it is not already too  late for some.” In reference to the way in which Credit Ratings Agencies  and banks have turned against Greece in ‘the market’, the report  warned:

The question is when markets will start putting pressure  on governments, not if. When will investors start demanding a much  higher compensation [interest rate] for holding increasingly large  amounts of public debt? In some countries, unstable debt dynamics — in  which higher debt levels lead to higher interest rates, which then lead  to even higher debt levels — are already clearly on the horizon.[77]

Further, the report stated that official debt figures in Western  nations are incredibly misleading, as they fail to take into account  future liabilities largely arising from increased pensions and health  care costs, as “rapidly ageing populations present a number of countries  with the prospect of enormous future costs that are not wholly  recognised in current budget projections. The size of these future  obligations is anybody’s guess.”[78]

In all the countries surveyed, the debt levels were assessed as a  percentage of GDP. For example, Greece, which was at the time of the  report’s publication, at risk of a default on its debt, had government  debt at 123% of GDP. In contrast, other nations which currently are  doing better (or seemingly so), in terms of market treatment, had much  higher debt levels in 2010: Italy had a government debt of 127% of GDP  and Japan had a monumental debt of 197% of GDP. Meanwhile, for all the  lecturing France and Germany have done to Greece over its debt problem,  France had a debt level of 92% of its GDP, and Germany at 82%, with the  levels expected to rise to 99% and 85% in 2011, respectively. The U.K.  had a debt level of 83% in 2010, expected to rise to 94% in 2011; and  the United States had a debt level of 92% in 2010, expected to rise to  100% in 2011. Other nations included in the tally were: Austria with 78%  in 2010, 82% in 2011; Ireland at 81% in 2010 and 93% in 2011; the  Netherlands at 77% in 2010 and 82% in 2011; Portugal at 91% in 2010 and  97% in 2011; and Spain at 68% in 2010 and 74% in 2011.[79]

Further, the BIS paper warned that debt levels are likely to continue  to dramatically increase, as, “in many countries, employment and growth  are unlikely to return to their pre-crisis levels in the foreseeable  future. As a result, unemployment and other benefits will need to be  paid for several years, and high levels of public investment might also  have to be maintained.”[80] The report goes on:

Seeing that the status quo is untenable, countries are  embarking on fiscal consolidation plans [austerity measures]. In the  United States, the aim is to bring the total federal budget deficit down  from 11% to 4% of GDP by 2015. In the United Kingdom, the consolidation  plan envisages reducing budget deficits by 1.3 percentage points of GDP  each year from 2010 to 2013.[81]

However, the paper went on, the austerity measures and  “consolidations along the lines currently being discussed will not be  sufficient to ensure that debt levels remain within reasonable bounds  over the next several decades.” Thus, the BIS suggested that, “An  alternative to traditional spending cuts and revenue increases is to  change the promises that are as yet unmet. Here, that means embarking on  the politically treacherous task of cutting future age-related  liabilities.”[82] In short, the BIS was recommending to end pensions and  other forms of social services significantly or altogether; hence,  referring to the task as “politically treacherous.” The BIS recommended  “an aggressive adjustment path” in order to “bring debt levels down to  their 2007 levels.”[83] The challenges for central banks, the BIS  warned, was that it could spur long-term increases in inflation  expectations, and that the uncertainty of “fiscal consolidation” (see:  fiscal austerity measures) make it difficult to determine when to raise  interest rates appropriately. Inflation acts as a ‘hidden tax’, forcing  people to pay more for less, particularly in the costs of food and fuel.  Raising interest rates at such a time “would not work, as an increase  in interest rates would lead to higher interest payments on public debt,  leading to higher debt,” and thus, potentially higher inflation.[84]

In April of 2010, the OECD (Organisation for Economic Co-operation  and Development) warned that the Greek crisis was spreading “like  Ebola,” and that the crisis was “threatening the stability of the  financial system.”[85] In early 2010, the World Economic Forum (WEF)  warned that there was a “significant chance” of a second major financial  crisis, “and similar odds of a full-scale sovereign fiscal crisis.” The  report identified the U.K. and U.S. as having “among the highest debt  burdens.”[86]

Nouriel Roubini, a top American economist who accurately predicted  the financial crisis of 2008, wrote in 2010 that, “unless advanced  economies begin to put their fiscal houses in order, investors and  rating agencies will likely turn from friends to foes.” Due to the  financial crisis, the stimulus spending, and the massive bailouts to the  financial sector, major economies had taken on massive debt burdens,  and, warned Roubini, faced a major sovereign debt crisis, not relegated  to the euro-zone periphery of Greece, Portugal, Spain, and Ireland, but  even the core countries of France and Germany, and all the way to Japan  and the United States, and that the “U.S. and Japan might be among the  last to face investor aversion.” Thus, concluded Roubini, developed  nations “will therefore need to begin fiscal consolidation as soon as  2011-12 by generating primary surpluses, which can be accomplished  through a combination of gradual tax hikes and spending cuts.”[87]

In February of 2010, Niall Ferguson, economic historian, Bilderberg  member, and official biographer of the Rothschild family, wrote an  article for the Financial Times in which he warned that a “Greek crisis”  was “coming to America.” Ferguson wrote that far from remaining in the  peripheral eurozone nations, the current crisis “is a fiscal crisis of  the western world. Its ramifications are far more profound than most  investors currently appreciate.” Ferguson wrote that the crisis will  spread throughout the world, and that the notion of the U.S. as a “safe  haven” for investors is a fantasy, even though the “day of reckoning” is  still far away.[88]

In December of 2010, Citigroup’s chief economist warned that, “We  could have several sovereign states and banks going under,” and that  both Portugal and Spain will need bailouts.[89] In late 2010, Mark  Schofield, head of interest rate strategy at Citigroup, “said that a  debt overhaul with similarities to the ‘Brady Bond’ solution to the  1980s crisis in Latin America was being extensively discussed in the  markets.”[90] This would of course imply a similar response to that  which took place during the 1980s debt crisis, in which Western nations  and institutions reorganized the debts of ‘Third World’ nations that  defaulted on their massive debts, and thus they were economically  enslaved to the Western world thereafter.

In January of 2011, the IMF instructed major economies around the  world, including Brazil, Japan, and the United States, “to implement  deficit cutting plans or risk a repeat of the sovereign debt crisis that  has engulfed Greece and Ireland.” At the same time, the Credit Ratings  Agency Standard and Poor’s cut Japan’s long-term sovereign debt rating  for the first time since 2002. As the Guardian reported:

The IMF said Japan, America, Brazil and many other  indebted countries should agree targets for bringing borrowing under  control. In an updated analysis on global debt and deficits, it said the  pace of deficit reduction across the advanced economies was likely to  slow this year, mainly because the US and Japan are preparing to  increase their borrowing.[91]

Ireland was recently gripped with a major debt crisis. In 2009,  Ireland was officially in an economic depression, and as one commentator  asked in the Financial Times, “So will this be known as the Depression  of the early 21st century?”[92] With the government of Ireland bailing  out its banks in crisis, and descending into its own sovereign debt  crisis, the European Union’s newly created European Financial Stability  Facility (EFSF) and the IMF agreed to a bailout of Ireland for roughly  $136 billion in November of 2010. However, as to be expected, the IMF  and the European Central Bank (ECB) stated that the bailout “would be  provided under ‘strong policy conditionality’, on the basis of a  programme negotiated with the Irish authorities by the [European]  Commission and the IMF, in liaison with the ECB.”[93] As part of the  bailout, austerity measures were to imposed upon the Irish people, with  spending cuts put in place as well as tax increases for the people (but  not for corporations).[94]

As a Deutsche Bank executive stated in April of 2011, “the Global  Sovereign crisis is probably still in the early stages and is likely to  run through most of this decade, and we will be looking at the US for a  possible denouement to the unfolding Sovereign issues still to play out  globally.”[95]

Debt Crisis or Banking Crisis: Whose Debt is it Anyway?

As of April 2009, EU governments had bailed out their banks to the  tune of $4 trillion.[96] In February of 2009, the Telegraph ran an  article entitled, “European banks may need 16.3  trillion pound bail-out,” as revealed by a secret European Commission  document. However, the figure was so terrifying that the title of the  article was quickly changed, and all mention of the number itself was  removed from the actual article; yet, a Google search under the original  title still brings up the Telegraph report, but when the link is  clicked, it is headlined under its new name, “European bank bail-out  could push EU into crisis.” To put it into perspective, however, a 16.3  trillion pound bailout is roughly equal to $34.5 trillion. As the secret  report stated, “Estimates of total expected asset write-downs suggest  that the budgetary costs – actual and contingent – of asset relief could  be very large both in absolute terms and relative to GDP in member  states.” In other words, the bad debts of the banks require bailouts so  enormous that it could threaten the fiscal positions of major nations to  do so. However, the report further stated, “It is essential that  government support through asset relief should not be on a scale that  raises concern about over-indebtedness or financing problems.”[97] In  July of 2009, Neil Barofsky, the Special Inspector General for the U.S.  bailout (TARP) program, warned that U.S. taxpayers could potentially be  on the hook for $24 trillion.[98] Now, while this figure remains  unconfirmed, other figures have placed the total cost of the bailout at  $19 trillion, with over $17 trillion of that going directly to Wall  Street.[99]

In November of 2009, Moody’s reported that global banks face a  maturing debt of $10 trillion by 2015, $7 trillion of which will be due  by the end of 2012.[100] In April of 2011, the IMF published a report  warning that, “Debt-laden banks are the biggest threat to global  financial stability and they must refinance a $3.6 trillion ‘wall of  maturing debt’ which comes due in the next two years.” The report was  specifically referring to European banks, and the report elaborated,  “these bank funding needs coincide with higher sovereign refinancing  requirements, heightening competition for scarce funding  resources.”[101]

The real truth is that the true crisis is “an international banking  crisis.”[102] Global banks are insolvent. For over a decade, they  inflated massive asset bubbles (such as the housing market) through  issuing bad loans to high-risk individuals; they also issued bad loans  to nations and helped them hide their real debt in the derivatives  market; and all the while they speculated in the derivatives market to  both inflate the bubbles and hide the debt, and subsequently to profit  off of the collapse of the bubble and sovereign debt crisis. The  derivatives market stands at a whopping $600 trillion, with $28 trillion  of that inflating the credit default swaps market, the specific market  for sovereign debt speculation.[103]

With the onset of the global financial crisis in 2008, major nations  moved to bailout these massive banks, thereby keeping them afloat and  making them bigger and more dangerous than ever, when they should have  simply allowed them to fail and collapse under their own hubris. The  effect of the bailouts was to transfer tens of trillions of dollars in  bad debts of the banks to the public coffers of nations: private debt  became public debt, private liabilities became public liabilities, and  thus, the risk was transferred from millionaire and billionaire bankers  to the taxpayers. This is often called ‘corporate socialism’ (or  ‘economic fascism’) as it privatizes profits and socializes risk.  However, the bailouts did not ‘buy’ all the bad debts of banks, as they  were specifically focused on the debts related to the housing market.  The banks, still insolvent even after the bailouts, hold tens of  trillions in bad debts in other asset bubbles such as the commercial  real estate bubble (which is arguably larger than the housing  bubble[104]), as well as derivatives, and now sovereign debt.

Global financial institutions – such as the IMF – and the major  political powers – such as the U.S. and E.U. – continue to serve the  interests of bankers over people. Thus, with the onset of the sovereign  debt crisis, no one is questioning the legitimacy of the debt, but  rather, they are forcing entire nations and populations to impoverish  themselves and deconstruct their society in order to get more debt to  pay the interest on old – illegitimate – debts to banks which are  insolvent and profiting off of their countries plunging into crises.  Like a snake wrapping around its victim, the more you struggle, the  tighter becomes its hold; with every breath you take, its coils wrap  closer and tighter, still. The world is ensnarled in the snake-like grip  of global bankers, as they demand that the people of the world pay for  their mistakes, their predatory practices, and their own failures.

Greece Gets Another Bailout… for the Bankers

In March of 2011, Moody’s downgraded Greece’s credit rating to a  lower rating than that of Egypt, which had recently experienced an  uprising which led to the resignation of long-time Egyptian dictator,  Hosni Mubarak. The move by Moody’s “prompted investors to dump the debt  of other struggling European economies.”[105] In June of 2011, Greece  was given the lowest credit rating ever by Standard & Poor’s, saying  that Greece is “increasingly likely” to face a debt restructuring and  be the first sovereign default in the euro-zone’s history. The S&P  specified, “Risks for the implementation of Greece’s EU/IMF borrowing  program are rising, given Greece’s increased financing needs and ongoing  internal political disagreements surrounding the policy conditions  required.” At the same time, the Greek Treasury was attempting to sell  $1.8 billion of treasury bills (selling Greek debt) in order to continue  meeting financial needs. However, the downgrade by S&P made the  treasury bills far less attractive an investment, and thus, pushed  Greece into an even deeper crisis. At the same time, credit default  swaps surged to record highs on Greece, Portugal, and Ireland.  Simultaneously, Greece was seeking a second bailout, and thus, the lower  rating would make any potential loans (which would carry extra risk due  to the low credit rating) come attached with much higher interest  rates, ensuring a continuation of future fiscal and debt crises for the  country. In short, the lower credit rating plunged the country into a  deeper crisis, though analysts at JP Morgan and other banks stated that  the credit ratings agencies were actually following behind the market,  as the major banks had already been betting against Greece’s ability to  repay its debt (to them, no doubt).[106]

In June, the EU and IMF concluded a harsh audit of Greece’s finances  as a condition for getting a further tranche of its previous bailout  loan, with Greece “pledging further reforms and a privatisation drive  that has put local unions on the warpath again.” The Greek Ministry  “said it had discussed with auditors a four-year programme to reduce the  Greek public deficit and its debt of some 350 billion euros ($504  billion) through further reform and sweeping, controversial  privatizations,” which the IMF, the European Central Bank (ECB) and the  EU made “a condition of further aid.” Greece was seeking a further 70  billion euro bailout, and the country announced the implementation of  further austerity measures:

It has also pledged to hold a 50-billion-euro sale of  state assets including the near-monopoly telecom and electricity  operators, the country’s two main ports and one of its best-capitalised  banks, Hellenic Postbank.[107]

With major protests, strikes, and riots erupting in Greece against  the draconian austerity measures, the economic and social crisis was  more deeply enmeshed in a domestic political crisis. The Bank for  International Settlements (BIS) published a list of those countries and  banks which were the most heavily exposed to Greek debt. The total  lending exposure to Greece by 24 nations was over $145 billion, with the  exposure of European banks at $136 billion, and non-European banks at  nearly $9.5 billion. France had an exposure of $56.7 billion, Germany of  $33.9 billion, Italy of $4 billion, Japan of $1.6 billion, the U.K. of  $14 billion, the U.S. of $7.3 billion, and Spain at $974 million. Thus,  these were the countries with the most to lose in the event of a Greek  default.[108]

However, the overall exposure includes lending not only to the  country (sovereign debt), but industries, banks, and individuals.  France’s overall exposure was highest with $56.7 billion, however, in  terms of exposure to sovereign debt specifically, France had an exposure  of $15 billion. While Germany had a lower overall exposure at $33.9  billion, German lenders were the most exposed to sovereign debt at $22.7  billion. French banks had a higher overall exposure because $39.6  billion of the $56.7 billion total was loaned to companies and  households.[109]

In mid-June 2011, Moody’s warned that it might cut the credit ratings  of France’s three largest banks due to their holdings of Greek debt,  and placed “BNP Paribas, Crédit Agricole and Société Générale on review  for a possible downgrade.”[110]

In June, it was reported that the IMF exerted strong pressure on  Germany to give Greece another bailout, threatening to trigger a  sovereign default if Germany did not agree to a bailout. As reported in  the Guardian: “The fund warned the Germans in recent weeks that it would  withhold urgently needed funds and trigger a Greek sovereign default  unless Berlin stopped delaying and pledged firmly that it would come to  Greece’s rescue.”[111] As part of the new bailout, there would be  “unprecedented outside intervention in the Greek economy, including  international involvement in tax collection and privatisation of state  assets, in exchange for new bail-out loans for Athens.” Further, there  would be conditions in the package that would provide incentives for  holders of Greek debt (i.e., European banks) to voluntarily extend  Greece’s repayment period, by “rolling over” the debt into future bonds  (i.e., pushing the debt further down the road), and of course, the  package would also include a new round of austerity measures. Much of  the funding is expected to come from the sale of state assets, with the  IMF and EU providing roughly $43 billion extra.[112]

The major lenders were seen to have a role in the latest Greek  bailout, with French banks agreeing to a possible roll-over of Greek  debt, meaning that the banks would be extending the maturity of some of  their holdings of Greek debt, and that “banks would reinvest most of the  proceeds of their holdings of Greek debt maturing between now and 2014  back into new long-term Greek securities.”[113] German banks also agreed  to roll over 3.2 billion euros of Greek debt falling due up to and  including 2014.[114]

In late June, the Greek government approved another harsh austerity  package, prompting more massive protests, strikes, and riots. The second  bailout package has been running into significant problems, largely to  do with its stipulations for private sector involvement, creating many  conflicts between those parties which must agree to the bailout. The  ultimate bailout package, expected to be in the range of 80 to 90  billion euros, might not be agreed upon until September. Meanwhile,  hedge funds have been speculating in the derivatives market seeking to  make financial gains throughout the unfolding crisis.[115]

The Crisis Spreads Through Europe

Portugal descended into a major debt crisis in 2011. In March, the  country’s parliament rejected a new austerity package to deal with its  debt, and “the market” reacted by moving against the country, as  “sovereign bond yields soared to new highs,” with Fitch Ratings  downgrading Portugal’s credit rating and Moody’s downgraded the rating  of several Spanish banks, which are heavily exposed to Portuguese  debt.[116] In April of 2011, Portugal sought the assistance of the EU  and IMF and requested a bailout of roughly 80 billion euros. As a  condition for such a bailout, Portugal would be forced to impose harsh  austerity measures in a ‘Structural Adjustment’ package which “will  include structural reforms, spending cuts, a stabilisation programme for  the country’s financial sector and ambitious privatisation plans.”[117]  As such prospects increase for Portugal’s neighbour Spain, which is  considered both “too big to fail” and “too big to bail,” Spain’s  government has imposed several rounds of harsh austerity measures.[118]

In May, an agreement was reached to bailout Portugal by the EU and  IMF worth roughly $111 billion. As part of the agreement, Portugal had  to implement the austerity measures that its parliament had rejected in  March, cutting spending (including pensions), while roughly 12 billion  euros (or $17.8 billion) of the 78 billion euro bailout would go to  banks.[119] In July, Moody’s slashed Portugal’s credit rating to “junk  status,” and European bank shares fell sharply, as they are heavily  exposed to Portuguese debt. Moody’s warned that Portugal may need a  second bailout (just like Greece), which pushed Portugal’s borrowing  costs further up, plunging the country and Europe as a whole deeper into  a debt crisis.[120]

In July, Moody’s downgraded Portugal’s debt to junk status,  increasing fears that Spain and Italy will be targeted next. The  downgrade also came with a warning that Portugal may, like Greece, need a  second bailout, which pushed European stock markets down, “adding to  the woes of Ireland, Spain and Italy as traders dumped their bonds,  forcing their interest rates up.”[121] In July, Moody’s downgraded  Ireland’s rating to “junk status,” putting it in the same category as  Greece and Portugal, and further exacerbating the economic crisis there,  and fuelling fears about Spain and Italy.[122]

Italy, with $2.6 trillion in outstanding debt, was plunged into a  deep crisis in early July, and began to edge toward a potential need for  a bailout.[123] French banks have an exposure of $392.6 billion in  Italian debt (both public and private), which is more than double of the  German exposure to Italy.[124] Amid the increased fears over Italy’s  debt, its borrowing costs soared (plunging it even deeper into crisis).  Italy’s government announced the intention to impose an austerity plan  to cut 40 billion euros out of its budget.[125] Mario Draghi, governor  of the Bank of Italy, endorsed the austerity package, calling it “an  important step.” Mario Draghi is incidentally set to take over the  position of President of the European Central Bank in November, when  Jean-Claude Trichet steps down.[126]

Spanish banks reportedly had an exposure of 100 billion euros in  Portuguese debt, meaning that a bailout for Portugal is in fact a  bailout for Spanish banks.[127] UK banks were sitting on roughly 100  billion pounds (roughly $150 billion) of exposure to Greek, Portuguese,  and Spanish debt, as of April 2010.[128] It was reported in April of  2011 that British banks had an exposure of roughly 33.7 billion euros to  Portugal, comparing favourably with French and German exposure, unlike  in Ireland, where British banks have the largest exposure of all foreign  banks. Though, in total, European banks hold roughly $266 billion in  exposure to Portuguese debt.[129]

As the Bank for International Settlements reported in March of 2011,  the total exposure by foreign banks to what is referred to as Europe’s  ‘PIGS’ (Portugal, Ireland, Greece, and Spain) is roughly $2.5 trillion.  Germany has the largest exposure, at $569 billion, the U.K. is next with  $431 billion, and France is in third with $380 billion. The British  banks have an exposure of $225 billion in Ireland and $152 billion in  Spain.[130]

With Italy in crisis, European banks are even more exposed, as their  net exposure to Italian sovereign debt (not to be confused with total  debt exposure, public and private) is more than their exposure to  Greece, Portugal, Ireland, and Spain combined. Exposure to those four  nations is roughly $226 billion, while European banks’ exposure to  Italy’s sovereign debt is $262 billion, making the threat of a bailout  or a potential default all the more pronounced.[131]

The European Central Bank (ECB) itself, through purchasing of  government bonds from Europe’s weakest economies, reportedly has an  exposure of 444 billion euros (or $630 billion) to Portugal, Italy,  Ireland, Greece, and Spain (the PIIGS). As one think tank reported on  the figures, “There is a hidden – and potentially huge – cost of the  euro zone crisis to taxpayers buried in the ECB’s books.”[132]

Banking on a Depression

In late June of 2011, the BIS “urged Europe to end its dithering and  find a permanent solution to the sovereign debt crisis,” and wrote in  its annual report: “For well over a year, European policy makers have  been scrambling to put together short-term fixes for the hardest-hit  countries while debating how to design a viable and credible long-term  solution,” adding, “they need to finish the job, once and for all.”  Further, the BIS warned, “Governments that put off addressing their  fiscal problems run a risk of being punished both suddenly and  harshly.”[133]

The BIS further warned that inflation needs to be fought by central  banks raising their interest rates, thus making money more expensive,  and that “with the scope for rapid growth closing, monetary policy  should be quickly brought back to normal and countries should act  urgently to close budget deficits.” The recommendation by the BIS was  for both emerging market economies (such as China, India, Brazil, etc.)  and advanced industrialized economies (Europe, United States), and the  BIS “warned policymakers not to expect a normal recovery because much of  the pre-crisis growth had been unsustainable and capacity will have  been destroyed for ever, particularly in finance and construction.” As  the Financial Times reported:

Rising food, energy and other commodity prices  underscored the need for central banks around the world to begin raising  interest rates, perhaps even more rapidly than they brought them down,  said the BIS in its report. “Highly accommodative monetary policies are  fast becoming a threat to price stability,” it concluded.

The fact that interest rates have been so low for so long also  introduces new risks into the world’s financial system even though these  policies were put in train initially by a desire to reduce risk, the  report added.

“The persistence of very low interest rates in major advanced  economies delays the necessary balance sheet adjustments of households  and financial institutions,” the BIS said.[134]

In other words, according to the BIS, it’s time to tighten the grip.  Raising interest rates will mean that loans and debt become more  expensive for governments, corporations, banks, and individuals. The  stated aim of this, according to the BIS, is to reduce inflationary  pressure, where money is printed easily and crosses borders easily with  near-zero interest rates, making it cheap. The free flow of money (low  interest rates) allowed the housing bubble (and other bubbles, such as  the commercial real estate bubble) to grow and inflate. Low interest  rates are designed to encourage investment and lending, but of course,  the major banks that got the bailout money did not increase lending,  they increased their executive’s bonuses. Thus, low interest rates were  designed to encourage economic growth, which is why they were kept low  following the onset of the economic crisis. However, with the major  bailouts and stimulus packages, unprecedented amounts of money were  pumped into the economy, and as such, the value of the currency being  printed goes down (the more there is, the less valuable it becomes).  This causes inflation (which acts as a hidden tax on the consumer),  because it means that it requires more of the currency to buy less. The  prices of food and fuel in particular increase, which is largely  detrimental to the middle class consumer, whose wages do not increase  with inflation. Thus, they make less when they need to spend more to buy  less.

The BIS warned in June of 2010 that the record low interest rates  “aimed at spurring economic growth, were keeping households and banks  from reducing the huge debts that led to the credit crunch.” Its 2010  annual report warned: “Keeping interest rates near zero for too long,  with abundant liquidity, leads to distortions and creates risks for the  financial and monetary stability.”[135] Even in its 2009 annual report,  the BIS said it feared that central banks would raise their interest  rates too late, which would ultimately lead to inflation anyway. As the  report stated, keeping the rates low would “lead to inflation that feeds  inflation expectations or it may fuel yet another asset-price bubble,  sowing the seeds of the next financial boom-bust cycle.”[136]

The hesitation to raise interest rates comes from the fact that there  has been no economic ‘recovery,’ and thus, raising rates would lead to a  protracted stagnation, or a double-dip recession, or perhaps more  bluntly, a very deep depression. The raising of interest rates in an  attempt to reduce inflation could potentially be irrelevant, as the  increased rates would prompt higher interest payments on debts, forcing  governments to print more money (or get more bailouts or loans) in order  to make their payments, and thus, more money being pumped into the  economy would further exacerbate inflation, itself. Already, the Chinese  central bank (which is a member of the BIS) raised its interest rates,  with India having increased interest rates over the year as well.[137]  The European Central Bank also raised its interest rates in July, for  the second time this year, to 1.5%, and may be expected to raise it  further by the end of the year.[138] The BIS annual report for 2011  stated:

All financial crises, especially those generated by a  credit-fuelled property price boom, leave long-lasting wreckage. But we  must guard against policies that would slow the inevitable adjustment.  The sooner that advanced economies abandon the leverage-led growth that  precipitated the Great Recession, the sooner they will shed the  destabilising debt accumulated during the last decade and return to  sustainable growth. The time for public and private consolidation is  now… We should make no mistake here: the market turbulence surrounding  the fiscal crises in Greece, Ireland and Portugal would pale beside the  devastation that would follow a loss of investor confidence in the  sovereign debt of a major economy.[139]

Whether inflation, high interest rates, or a more-deadly combination  of both, the average person suffers most. Inflation hits home as wages  remain stagnant or are cut (under ‘fiscal austerity measures’), while  costs for consumer goods (such as food and fuel) increase. Increased  interest rates drain the remaining resources of consumers, who are  largely debt-ridden, and will have to make increased payments on their  debts. Such a scenario for an individual debtor (say, a middle class  consumer), is likely to play out in a scenario similar to Greece: either  they go further into debt to pay interest on old debt (like paying off  one credit card with another), thus increasing their future liabilities  (kicking the can down the road); or, they default and declare  bankruptcy, and come under the tutelage of bank supervision, losing all  their assets. In a combination of both inflation and high interest  rates, the middle class will become totally impoverished, as they are  already a class based entirely on debt.

The Plutonomy

A 2005 report from Citigroup coined the term “plutonomy,” to describe  countries “where economic growth is powered by and largely consumed by  the wealthy few,” and specifically identified the U.K., Canada,  Australia, and the United States as plutonomies. Keeping in mind that  the report was published three years before the onset of the financial  crisis in 2008, the Citigroup report stated that, “asset booms, a rising  profit share and favourable treatment by market-friendly governments  have allowed the rich to prosper and become a greater share of the  economy in the plutonomy countries,” and that, “the rich are in great  shape, financially.”[140] As the Federal Reserve reported, “the nation’s  top 1% of households own more than half the nation’s stocks,” and “they  also control more than $16 trillion in wealth — more than the bottom  90%.” The term ‘Plutonomy’ is specifically used to “describe a country  that is defined by massive income and wealth inequality,” and that they  have three basic characteristics, according to the Citigroup report:

1. They are all created by “disruptive technology-driven  productivity gains, creative financial innovation, capitalist friendly  cooperative governments, immigrants… the rule of law and patenting  inventions. Often these wealth waves involve great complexity exploited  best by the rich and educated of the time.”

2. There is no “average” consumer in Plutonomies. There is only the  rich “and everyone else.” The rich account for a disproportionate chunk  of the economy, while the non-rich account for “surprisingly small bites  of the national pie.” [Citigroup strategist Ajay] Kapur estimates that  in 2005, the richest 20% may have been responsible for 60% of total  spending.

3. Plutonomies are likely to grow in the future, fed by  capitalist-friendly governments, more technology-driven productivity and  globalization.[141]

Kapur, who authored the Citigroup report, stated that there were also  risks to the Plutonomy, “including war, inflation, financial crises,  the end of the technological revolution and populist political  pressure,” yet, “the rich are likely to keep getting even richer, and  enjoy an even greater share of the wealth pie over the coming  years.”[142]

More recently, Moody’s Analytics reported that, “the top 5 percent of  American earners are responsible for 35 percent of consumer spending,  while the bottom 80 percent engage in only 39.5 percent of consumer  outlays,” while “the top 10 percent of earners received 50 percent of  all income, while they accounted for only 22 percent of spending.” Much  of their money disappeared into the speculative booms, especially the  housing boom.[143]

In February of 2011, Ajay Kapur, the author of the Citigroup report  who is now with Deutsche Bank, gave an interview in which he explained  that, “the world economy is even more dependent on the spending and  consumption of the rich,” and that, “Plutonomist consumption is almost  10 times as volatile that of the average consumer.” He further explained  that increased debt levels are a sign of plutonomies:

We have an economy today where a large fraction of the  population doesn’t pay federal income taxes and, because of demand for  entitlements, we have a system of massive representation without  taxation. On the other hand, you have plutonomists who protect their  turf and the taxation amounts are not enough to pay for everyone’s  demand. So I’ve come to the conclusion that budget deficits are biased  toward getting bigger and bigger. Budget deficits are going to become a  manifestation of a plutonomy.[144]

The plutonomy is largely characterized by a lack of a consuming and  vibrant middle class. This is a trend that has been accelerating for  several decades, particularly in North America and Britain, where the  middle class population is heavily indebted. The middle class has  existed as a consumer class, keeping the lower class submissive, and  keeping the upper class secure and wealthy by consuming their products,  produced with the labour of the lower class. As a Bank of  America-Merrill report noted in 2009, the middle class “is  over-leveraged.” The report stated, “the consumer debt problem in the  economy really is a debt problem for the middle class. The need to work  off a chunk of that debt will sap middle-class families’ spending power  for perhaps years to come.” Further:

By contrast, the upper 10% of income earners face a much  smaller debt burden relative to income and net worth. Those people  should have ample spending power to help fuel an economic recovery.

Using 2007 data from the Federal Reserve, BofA Merrill defines the  middle class as people in the 40%-to-90% income percentiles. It defines  lower-income folks as those in the zero to 40% income percentiles, and  the wealthy as those in the top 10%.

Lower-income families account for 40% of the population but just 12%  of total consumption, BofA Merrill estimates. The middle class is 50% of  the population and nearly as large a share of consumption, at 46%.

 

That leaves the wealthy to account for a hefty 42% of consumption.

In terms of their debt burdens, neither lower-income families nor the  wealthy are constrained the way the middle class is constrained, the  report asserts.[145]

The report further asserted that, “the middle-class has suffered more  than the wealthy from the housing crash because middle-class families  tended to rely more on their homes to build savings through rising  equity. Also, the wealthy naturally had a much larger and more diverse  portfolio of assets — stocks, bonds, etc.”[146]

In short, when the day comes where the rest of the industrialized  world falls into the same trap as Greece, the middle class will be  pushed down into the lower class, and a global socio-economic plutonomy  will emerge. The middle class cannot survive the perfect storm of fiscal  austerity, increased interest rates, inflation and ‘Structural  Adjustment.’ We are entering a global age of austerity, where our  political leaders commit social genocide for the benefit of the global  banks, and at the behest of the institutions that represent them. The  IMF and other supranational institutions increase their own powers and  authority in order to punish and impoverish large populations. What has  been done to the ‘Third World’ – the ‘Global South’ – over the past  several decades is now being done to us, in the industrialized North.

In Conclusion

In the face of this massive global social, political, and economic  crisis, the reaction of the world’s elite is to further centralize power  structures on a global scale, to further remove power from the rest of  humanity and move it upwards to a tiny elite. This not only creates  massive disparity and inequality, but it establishes the conditions for  an incredibly radicalized, restless, and angry world population. As  such, the centralized global power structures that elites seek to  strengthen and build anew will ultimately be authoritarian, oppressive,  and dehumanizing. This is so because the social unrest resulting from  this massive global impoverishment will make the apparatus of oppression  necessary in order to secure and maintain those very power structures.  In short, if the elite do not become oppressive and totalitarian, they  will lose their grip on power in the face of massive global social  unrest. This will require brutal wars of domination abroad, and ruthless  techno-social systems of oppression at home.

The people of the world are faced with a great challenge, unlike any  other faced in all of human history. The only way out is realizing that  the struggle of one is the struggle of all: freedom for all, or freedom  for none. Of course, a true global resistance is a long way down the  road. There still remain diverse disputes and ideological differences  which maintain disunity. The challenge, then, is to find the common  ground for all people, and to move forward despite ideological or other  differences, and to work together to find a solution. This is no small  challenge.

We will likely see the proliferation of many new ideologies and  indeed even a ‘global philosophical revolution’ of sorts, which may seek  to unite humanity under the banner of a new human understanding. Such a  philosophy would run counter to the elite-driven philosophy focused on  power-centralization and global domination, and would – in order to be  legitimate – draw from a great many philosophical, theoretical and even  spiritual disciplines and beliefs. As such, it is perhaps important to  not revert to old – tried and tested – ideological doctrines as the one  and only “solution.” For example, there are growing nationalist  movements in reaction to the elite-driven doctrine of ‘globalism’,  notably in the United States. For a true step forward, we must remain  open to and in fact encourage a proliferation of new ideas instead of  reverting to the old; to learn from both the failures and successes of  old ideas, instead of holding on to a myth of ‘what was’, such as the  ‘idea’ of a wonderful, prosperous America for all. This era never truly  existed in America’s history, yet the myth remains strong, and is a  fundamental driving force behind the resurgent nationalist movement. As  such, for many in the anti-globalist movement, criticism of nationalism  is instantly thrown into the camp of support for globalism, not allowing  room for a critique of both. This is a dangerous situation –  ideologically and politically – as true change can only come from  self-reflection and understanding. There needs to be room left for new  ideas, otherwise we will simply revert to repeating old mistakes.

Indeed, we are entering perhaps the most important historic era in  the human story thus far. The notion that there will not be new ideas,  philosophies, ideologies and beliefs runs counter to the historical fact  that times of social upheaval and rapid political transformation often  give rise to new ideas and philosophies. This time around, the world is  globalizing, not only in terms of power structures, but also in terms of  ideational structures. In this sense, while the elite have never had  such an opportunity to impose control over all of humanity, all of  humanity has never had such an opportunity to effect an exchange of  ideas and information among each other, and thus, solidify a common  philosophical solidarity, and ultimately, re-take control of the world,  itself.

Andrew Gavin Marshall is an independent  researcher and writer based in Montreal, Canada, writing on a number of  social, political, economic, and historical issues. He is co-editor of  the book, “The Global Economic Crisis: The Great Depression of the XXI  Century.” His website is http://www.andrewgavinmarshall.com

This article first appeared on Andrew Gavin Marshall‘s blog.

Notes

[1]            Ed Harris, Greece turns to Socialists to fight economic crisis, London Evening Standard: 5 October 2009:

http://www.thisislondon.co.uk/standard/article-23752278-greece-turns-to-socialists-to-fight-economic-crisis.do

[2]            LANDON THOMAS Jr., In Greece, Some See a New Lehman, The New York Times, 12 June 2011:

http://www.nytimes.com/2011/06/13/business/global/13euro.html

[3]            Beat Balzli, How Goldman Sachs Helped Greece to Mask its True Debt, Spiegel Online, 8 February 2010:

http://www.spiegel.de/international/europe/0,1518,676634,00.html

[4]            LOUISE STORY, LANDON THOMAS Jr. and NELSON D.  SCHWARTZ, Wall St. Helped to Mask Debt Fueling Europe’s Crisis, The New  York Times, 13 February 2010:

http://www.nytimes.com/2010/02/14/business/global/14debt.html

[5]            John Carney, Goldman Sachs Shorted Greek Debt After It  Arranged Those Shady Swaps, Business Insider, 15 February 2010:

http://www.businessinsider.com/goldman-sachs-shorted-greek-debt-after-it-arranged-those-shady-swaps-2010-2

[6]            Jim Puzzanghera and Nathaniel Popper, Senate panel  concludes Goldman Sachs profited from financial crisis, Los Angeles  Times, 14 April 2011:

http://articles.latimes.com/2011/apr/14/business/la-fi-crisis-probe-20110414

[7]            Louise Story and Sewell Chan, E-mails suggest Goldman  profited in housing collapse, San Francisco Chronicle, 25 April 2010:

http://articles.sfgate.com/2010-04-25/news/20865082_1_goldman-sachs-e-mail-messages-betting

[8]            Matthew Philips, The Monster That Ate Wall Street, Newsweek, 27 September 2008: http://www.newsweek.com/2008/09/26/the-monster-that-ate-wall-street.html

[9]            Bloomberg, Fannie, Freddie ‘biggest disasters’ says JPMorgan Chase chief, The Economic Times, 18 February 2011:

http://articles.economictimes.indiatimes.com/2011-02-18/news/28615139_1_fannie-and-freddie-jamie-dimon-financial-crisis-inquiry-commission

[10]            Cornell, 4501 Congressional Findings, Title 12, Chapter 46, Cornell University Law School:

http://www.law.cornell.edu/uscode/12/usc_sec_12_00004501—-000-.html

[11]            Carol D. Leonnig, How HUD Mortgage Policy Fed The Crisis, The Washington Post, 10 June 2008:

http://www.washingtonpost.com/wp-dyn/content/article/2008/06/09/AR2008060902626.html

[12]            RUSSELL ROBERTS, How Government Stoked the Mania, The Wall Street Journal, 3 October 2008:

http://online.wsj.com/article/SB122298982558700341.html

[13]            STEVEN A. HOLMES, Fannie Mae Eases Credit To Aid Mortgage Lending, The New York Times, 30 September 1999:

http://www.nytimes.com/1999/09/30/business/fannie-mae-eases-credit-to-aid-mortgage-lending.html

[14]            Ibid.

[15]            Tom Abate, Housing, hedge funds spur bubble worries /  Some experts fear low interest rates may have pumped too much cash into  global markets, San Francisco Chronicle, 22 May 2005:

http://articles.sfgate.com/2005-05-22/business/17374185_1_asset-prices-interest-rates-central-bankers

[16]            Ryan Grim, Greenspan Wanted Housing-Bubble Dissent Kept Secret, Huffington Post, 3 May 2010:

http://www.huffingtonpost.com/2010/05/03/greenspan-wanted-housing_n_560965.html

[17]            Craig Torres, Fed Officials Saw Housing Bubble in 2005, Didn’t Alter Policy, Bloomberg, 14 January 2011:

http://www.bloomberg.com/news/2011-01-14/fed-saw-housing-bubble-in-2005-failed-to-alter-policy-of-rate-increases.html

[18]            Nell Henderson, Bernanke: There’s No Housing Bubble to Go Bust, The Washington Post, 27 October 2005:

http://www.washingtonpost.com/wp-dyn/content/article/2005/10/26/AR2005102602255.html

[19]            PBS, The Long Demise of Glass-Steagall. Frontline:

http://www.pbs.org/wgbh/pages/frontline/shows/wallstreet/weill/demise.html

[20]            Ibid.

[21]            Robert Buzzanco, Bring Back Glass-Steagall? History News Network: October 21, 2008:

http://hnn.us/articles/55548.html

[22]            NYT, Furor on Memo At World Bank, The New York Times, 7 February 1992:

http://www.nytimes.com/1992/02/07/business/furor-on-memo-at-world-bank.html

[23]            Peter Coy, How New Global Banking Rules Could Deepen the U.S. Crisis, Business Week, 17 April 2008:

http://www.businessweek.com/magazine/content/08_17/b4081083014665.htm

[24]            Carroll Quigley, Tragedy and Hope: A History of the  World in Our Time (New York: Macmillan Company, 1966), pages 324-325.

[25]            Ambrose Evans-Pritchard, BIS warns of Great Depression dangers from credit spree, The Telegraph, 25 June 2007:

http://www.telegraph.co.uk/finance/economics/2811081/BIS-warns-of-Great-Depression-dangers-from-credit-spree.html

[26]            Ambrose Evans-Pritchard, BIS slams central banks, warns of worse crunch to come, The Telegraph, 30 June 2008:

http://www.telegraph.co.uk/finance/markets/2792450/BIS-slams-central-banks-warns-of-worse-crunch-to-come.html

[27]            Chris Martenson, What the latest bailout plan means. ChrisMartenson.com: September 21, 2008:

http://www.chrismartenson.com/blog/what-latest-bailout-plan-means/5149

[28]            Larisa Alexandrovna, Welcome to the final stages of the coup. Huffington Post: September 29, 2008:

http://www.huffingtonpost.com/larisa-alexandrovna/welcome-to-the-final-stag_b_127990.html

[29]            Bailout Recipients, ProPublica:

http://projects.propublica.org/bailout/list/index

[30]            Robin Harding and Tom Braithwaite and Francesco  Guerrera, European banks took big slice of Fed aid, The Financial Times,  1 December 2010:

http://www.ft.com/intl/cms/s/0/4dd95e42-fd6d-11df-a049-00144feab49a.html#axzz1R9fhQUVh

[31]            MARY WILLIAMS WALSH, A.I.G. Lists Banks It Paid With U.S. Bailout Funds, The New York Times, 15 March 2009:

http://www.nytimes.com/2009/03/16/business/16rescue.html

[32]            Surojit Chatterjee, TARP funds benefited foreign  banks more, says oversight panel, International Business Times, 12  August 2010:

http://www.ibtimes.com/articles/43012/20100812/tarp-funds-benefited-foreign-banks-more-says-oversight-panel.htm

[33]            Neil Barofsky, Where the Bailout Went Wrong, The New York Times, 31 March 2011:

http://www.nytimes.com/2011/03/30/opinion/30barofsky.html

[34]            HEATHER SCOFFIELD, Financial repairs must continue: central banks, The Globe and Mail, 29 June 2009:

http://v1.theglobeandmail.com/servlet/story/RTGAM.20090629.wcentralbanks0629/BNStory/HEATHER+SCOFFIELD/

[35]            Ibid.

[36]            Simone Meier, BIS Sees Risk Central Banks Will Raise Interest Rates Too Late, Bloomberg, 29 June 2009:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aOnSy9jXFKaY

[37]            Ibid.

[38]            Robert Cookson and Sundeep Tucker, Economist warns of  double-dip recession, The Financial Times, 14 September 2009:

http://www.ft.com/intl/cms/s/0/e6dd31f0-a133-11de-a88d-00144feabdc0.html#axzz1R9fhQUVh

[39]            Robert Cookson and Victor Mallet, Societal  soul-searching casts shadow over big banks, The Financial Times, 18  September 2009:

http://www.ft.com/intl/cms/s/0/7721033c-a3ea-11de-9fed-00144feabdc0.html#axzz1R9fhQUVh

[40]            Ambrose Evans-Pritchard, Derivatives still pose huge risk, says BIS, The Telegraph, 13 September 2009:

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/6184496/Derivatives-still-pose-huge-risk-says-BIS.html

[41]            KATY BURNE, Derivatives-Trading Tally: $700 Trillion (or So), The Wall Street Journal, 6 December 2010:

http://online.wsj.com/article/SB10001424052748703471904576003400646739990.html

[42]            Global OTC derivatives, The Economist, 31 May 2011:

http://www.economist.com/blogs/dailychart/2011/05/derivatives_trade?fsrc=rss

[43]            Huw Jones, BIS-Banks may need more cash to clear derivatives, Reuters, 5 June 2011:

http://uk.reuters.com/article/2011/06/05/bis-clearing-idUKLDE7510HJ20110605

[44]            EDWARD WYATT, Report Says Excessive Risk Remains After Bank Bailout, The New York Times, 13 January 2011:

http://www.nytimes.com/2011/01/14/business/14tarp.html

[45]            Interview by Steve Inskeep, Barofsky: More Bank Bailouts Are Inevitable, NPR, 27 January 2011:

http://www.npr.org/2011/01/27/133264711/Troubled-Asset-Relief-Program-Update

[46]            Dan Rather, Barofsky, Dan Rather Reports, 7 June 2011:

http://www.hd.net/blogs/2011/06/barofsky-more-bailouts/

[47]            Philip Aldrick, Banks’ $4 trillion debts are  ‘Achilles’ heel of the economic recovery’, warns IMF, The Telegraph, 5  October 2010:

http://www.telegraph.co.uk/finance/economics/8043800/Banks-4-trillion-debts-are-Achilles-heel-of-the-economic-recovery-warns-IMF.html

[48]            Colin Barr, Let big banks fail, bailout skeptics say, CNN Money, 21 April 2009:

http://money.cnn.com/2009/04/21/news/too.big.fortune/index.htm?postversion=2009042112

[49]            Chris Isidore, Fed made $9 trillion in emergency overnight loans, CNN Money, 1 December 2010:

http://money.cnn.com/2010/12/01/news/economy/fed_reserve_data_release/index.htm

[50]            Jon Hilsenrath, A Closer Look at Europe and the Fed’s  Central Bank Swap Program, The Wall Street Journal, 7 May 2010:

http://blogs.wsj.com/economics/2010/05/07/a-closer-look-at-europe-and-the-feds-central-bank-swap-program/

[51]            Matthew Philips, Tracking the $19 Trillion Bailout Funds, Newsweek, 22 September 2009:

http://www.newsweek.com/blogs/wealth-of-nations/2009/09/22/tracking-the-19-trillion-bailout-funds.html

[52]            Dawn Kopecki and Catherine Dodge, U.S. Rescue May  Reach $23.7 Trillion, Barofsky Says (Update3), Bloomberg, 20 July 2009:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aY0tX8UysIaM

[53]            Neil Irwin and Zachary A. Goldfarb, Probe: Did big  U.S. banks contribute to the financial crisis in Greece?, The Washington  Post, 26 February 2010:

http://www.washingtonpost.com/wp-dyn/content/article/2010/02/25/AR2010022502183.html

[54]            Greenspan Examines Federal Reserve, Mortgage Crunch, PBS Newshour, 18 September 2007:

http://www.pbs.org/newshour/bb/business/july-dec07/greenspan_09-18.html

[55]            NYFed, Community Affairs Advisory Council, Federal Reserve Bank of New York:

http://www.newyorkfed.org/aboutthefed/ag_community_affairs.html

[56]            NYFed, Economic Advisory Panel, Federal Reserve Bank of New York:

http://www.newyorkfed.org/aboutthefed/ag_economic.html

[57]            NYFed, International Advisory Committee, Federal Reserve Bank of New York:

http://www.newyorkfed.org/aboutthefed/ag_international.html

[58]            NYFed, Fedwire Securities Customer Advisory Group, Federal Reserve Bank of New York:

http://www.newyorkfed.org/aboutthefed/ag_fedwire_securities_customer.html

[59]            David Reilly, Secret Banking Cabal Emerges From AIG Shadows, Bloomberg, 28 January 2010:

http://www.bloomberg.com/news/2010-01-28/secret-banking-cabal-emerges-from-aig-shadows-david-reilly.html

[60]            LANDON THOMAS Jr., In Greece, Some See a New Lehman, The New York Times, 12 June 2011:

http://www.nytimes.com/2011/06/13/business/global/13euro.html

[61]            VANESSA FUHRMANS and SEBASTIAN MOFFETT, Exposure to  Greece Weighs On French, German Banks, The Wall Street Journal, 17  February 2010:

http://online.wsj.com/article/SB10001424052748703798904575069712153415820.html

[62]            Manfred Ertel, The 300 Billion Euro Man, Spiegel Online, 31 March 2010:

http://www.spiegel.de/international/europe/0,1518,686604,00.html

[63]            Kerin Hope, Head of Greek debt office replaced, The Financial Times, 19 February 2010:

http://www.ft.com/intl/cms/s/0/964dca2c-1d45-11df-b12e-00144feab49a,s01=2.html#axzz1RRT1aNfQ

[64]            Henry Chu, European countries, IMF offer Greece $146 billion in loans, The Los Angeles Times, 3 May 2010:

http://articles.latimes.com/2010/may/03/world/la-fg-greece-bailout-20100503

[65]            Gabi Thesing and Flavia Krause-Jackson, Greece Faces  `Unprecedented’ Cuts as $159B Rescue Nears, Bloomberg, 2 May 2010:

http://www.bloomberg.com/news/2010-05-02/greece-faces-unprecedented-cuts-as-159b-rescue-nears.html

[66]            AFP, France, Germany Forced Greece to Buy Arms: MEP, Defense News, 7 May 2010:

http://www.defensenews.com/story.php?i=4616433

[67]            AP, Despite crisis Greece continues weapons purchases, Jerusalem Post, 28 May 2010:

http://www.jpost.com/International/Article.aspx?id=176792

[68]            Abigail Moses, Greek Contagion Concern Spurs European  Sovereign Default Risk to Record, Bloomberg, 26 April 2010:

http://www.bloomberg.com/news/2010-04-26/greek-contagion-concern-spurs-european-sovereign-default-risk-to-record.html

[69]            Ambrose Evans-Pritchard, ECB may have to turn to  ‘nuclear option’ to prevent Southern European debt collapse, The  Telegraph, 27 April 2010:

http://www.telegraph.co.uk/finance/economics/7640783/ECB-may-have-to-turn-to-nuclear-option-to-prevent-Southern-European-debt-collapse.html

[70]            Richard Wachman, Greece debt crisis: the role of credit rating agencies, The Guardian, 28 April 2010:

http://www.guardian.co.uk/business/2010/apr/28/greece-debt-crisis-standard-poor-credit-agencies

[71]            S&P, Management Profiles:

http://www.standardandpoors.com/about-sp/management-profiles/en/us

[72]            McGraw-Hill Companies, Executive Profiles:

http://www.mcgraw-hill.com/site/about-us/executive-profiles

[73]            S&P, Board of Directors:

http://investor.mcgraw-hill.com/phoenix.zhtml?c=96562&p=irol-govboard

[74]            Moody’s, Board of Directors:

http://ir.moodys.com/governance.cfm

[75]            Moody’s, Management Team:

http://ir.moodys.com/management.cfm

[76]            Fimalac, Board of Directors:

http://www.fimalac.com/board-of-directors.html

[77]            Ambrose Evans-Pritchard, Sovereign debt crisis at  ‘boiling point’, warns Bank for International Settlements, The  Telegraph, 8 April 2010:

http://www.telegraph.co.uk/finance/economics/7564748/Sovereign-debt-crisis-at-boiling-point-warns-Bank-for-International-Settlements.html

[78]            Ibid.

[79]            Stephen G Cecchetti, M S Mohanty and Fabrizio  Zampolli, The Future of Public Debt: Prospects and Implications, BIS  Working Papers, No 300, March 2010, page 3.

[80]            Ibid, page 4.

[81]            Ibid, page 9.

[82]            Ibid.

[83]            Ibid, page 12.

[84]            Ibid, page 14.

[85]            Greek debt crisis spreading ‘like Ebola’ and Europe must act now, OECD warns, The Telegraph, 28 April 2010:

http://www.telegraph.co.uk/finance/financialcrisis/7644709/Greek-debt-crisis-spreading-like-Ebola-and-Europe-must-act-now-OECD-warns.html

[86]            Edmund Conway, ‘Significant chance’ of second  financial crisis, warns World Economic Forum, The Telegraph, 14 January  2010:

http://www.telegraph.co.uk/finance/financetopics/davos/6990433/Significant-chance-of-second-financial-crisis-warns-World-Economic-Forum.html

[87]            Nouriel Roubini and Arpitha Bykere, The Coming Sovereign Debt Crisis, Forbes, 14 January 2010:

http://www.forbes.com/2010/01/13/sovereign-debt-crisis-opinions-colummnists-nouriel-roubini-arpitha-bykere.html

[88]            Niall Ferguson, A Greek crisis is coming to America, Financial Times, 10 February 2010:

http://www.ft.com/intl/cms/s/0/f90bca10-1679-11df-bf44-00144feab49a.html#axzz1RpfP4VNB

[89]            Ambrose Evans-Pritchard, Citigroup warns of fresh  wave of bank failures in Europe, The Telegraph, 21 December 2010:

http://www.telegraph.co.uk/finance/financialcrisis/8217859/Citigroup-warns-of-fresh-wave-of-bank-failures-in-Europe.html

[90]            Sam Fleming and Leo Lewis, Latin American-style cure  for euro-zone debt crisis looms, The Australian Business Times, 22  December 2010:

http://www.theaustralian.com.au/business/world/latin-american-style-cure-for-euro-zone-debt-crisis-looms/story-e6frg90o-1225974805041

[91]            Phillip Inman, IMF warns of new sovereign debt crisis for largest economies, The Guardian, 27 January 2011:

http://www.guardian.co.uk/business/2011/jan/27/imf-sovereign-debt-crisis-warning

[92]            Wolfgang Münchau, Our lethargic leaders must work together on the crisis, The Financial Times, 8 February 2009:

http://www.ft.com/intl/cms/s/0/3d51f3ce-f601-11dd-a9ed-0000779fd2ac.html#axzz1RpfP4VNB

[93]            Plan will have policy conditions – ECB, RTE News, 21 November 2010:

http://www.rte.ie/news/2010/1121/imf2-business.html

[94]            Republic of Ireland confirms EU financial rescue deal, BBC News, 22 November 2010:

http://www.bbc.co.uk/news/business-11807730
[95]            Joe Weisenthal, Deutsche Bank: The Global Sovereign Debt  Crisis Will Last The Entire Decade, And The US Will Cap It Off,  Business Insider, 19 April 2011:

http://www.businessinsider.com/deutsche-bank-on-the-sovereign-debt-crisis-cycle-2011-4

[96]            Elitsa Vucheva, European Bank Bailout Total: $4 Trillion, Bloomberg Businessweek, 10 April 2009:

http://www.businessweek.com/globalbiz/content/apr2009/gb20090410_254738.htm?chan=globalbiz_europe+index+page_top+stories

[97]            Bruno Waterfield, European bank bail-out could push EU into crisis, The Telegraph, 11 February 2009:

http://www.telegraph.co.uk/finance/financialcrisis/4590512/European-banks-may-need-16.3-trillion-bail-out-EC-dcoument-warns.html

[98]            AP, Watchdog sees huge U.S. bill for banks bailout, MSNBC, 20 July 2009:

http://www.msnbc.msn.com/id/32010841/ns/business-us_business/t/watchdog-sees-huge-us-bill-banks-bailout/

[99]            Matthew Philips, Tracking the $19 Trillion Bailout Funds, Newsweek, 22 September 2009:

http://www.newsweek.com/blogs/wealth-of-nations/2009/09/22/tracking-the-19-trillion-bailout-funds.html

[100]            Lee Jones, Banks will owe £6 trillion by 2015 as debt matures, Money Marketing, 10 November 2009:

http://www.moneymarketing.co.uk/investments/news/banks-will-owe-%C2%A36-trillion-by-2015-as-debt-matures/1001908.article

[101]            Agencies, Banks facing $3.6 trillion ‘wall of  maturing debt’, IMF Global Financial Stability Report says, The  Telegraph, 13 April 2011:

http://www.telegraph.co.uk/finance/economics/8448169/Banks-facing-3.6-trillion-wall-of-maturing-debt-IMF-Global-Financial-Stability-Report-says.html

[102]            IRWIN STELZER, Global Banking Is What’s Really in Crisis, The Wall Street Journal, 27 June 2011:

http://online.wsj.com/article/SB10001424052702304314404576409410834139324.html

[103]            John O’Donnell and Luke Baker, EU hits banks with credit default swap probe, Reuters, 29 April 2011:

http://www.reuters.com/article/2011/04/29/us-eu-antitrust-cds-idUSTRE73S3J020110429

[104]            CNBC, Commercial Real Estate Is Next Bubble to Burst: Tishman, CNBC News, 21 September 2009:

http://www.cnbc.com/id/32952174/Commercial_Real_Estate_Is_Next_Bubble_to_Burst_Tishman

[105]            Richard Blackden, Greek debt price soars as Moody’s  cuts credit rating below Egypt, The Telegraph, 7 March 2011:

http://www.telegraph.co.uk/finance/economics/8366707/Greek-debt-price-soars-as-Moodys-cuts-credit-rating-below-Egypt.html

[106]            Jennifer Ryan and Gabi Thesing, Greece Branded With  World’s Lowest Credit Rating by S&P on Default Threat, Bloomberg, 13  June 2011:

http://www.bloomberg.com/news/2011-06-13/greece-s-long-term-rating-cut-to-ccc-by-s-p-on-outlook-for-restructuring.html

[107]            AFP, Athens concludes EU-IMF audit: finance ministry, MSN News, 3 June 2011:

http://news.ph.msn.com/business/article.aspx?cp-documentid=4903548

[108]            The countries most exposed to Greek debt, The Telegraph, 15 June 2011:

http://www.telegraph.co.uk/finance/economics/8578337/The-countries-most-exposed-to-Greek-debt.html

[109]            Boris Groendahl, German Banks Top French on $23  Billion Greek Debt, BIS Says, Bloomberg Businessweek, 6 June 2011:

http://www.businessweek.com/news/2011-06-06/german-banks-top-french-on-23-billion-greek-debt-bis-says.html

[110]            Megan Murphy, Kerin Hope, Jennifer Thompson and  James Wilson, Greek contagion fears spread to other EU banks, The  Financial Times, 15 June 2011:

http://www.ft.com/intl/cms/s/0/ac918946-975a-11e0-9c9d-00144feab49a,s01=1.html#axzz1RpfP4VNB

[111]            Ian Traynor, Hardline IMF forced Germany to guarantee Greek bailout, The Guardian, 17 June 2011:

http://www.guardian.co.uk/business/2011/jun/16/imf-forced-germany-to-guarantee-greek-bailout

[112]            Peter Spiegel, Quentin Peel and Ralph Atkins, Greece  set for severe bail-out conditions, The Financial Times, 29 May 2011:

http://www.ft.com/intl/cms/s/0/eb91ba84-8a27-11e0-beff-00144feab49a.html#axzz1NnKIRZX9

[113]            MATTHEW SALTMARSH, French Banks Ready to Help Greek Bailout, The New York Times, 27 June 2011:

http://www.nytimes.com/2011/06/28/business/global/28iht-euro.html

[114]            Quentin Peel and Daniel Schäfer, German banks support Greek debt rollover, The Financial Times, 30 June 2011:

http://www.ft.com/intl/cms/s/0/d0112512-a32f-11e0-8d6d-00144feabdc0.html#axzz1RpfP4VNB

[115]            JULIE CRESWELL, Hedge Funds Seeking Gains in Greek Crisis, The New York Times, 3 July 2011:

http://www.nytimes.com/2011/07/04/business/04bets.html

[116]            Louise Armitstead, Portugal debt crisis: David  Cameron holds crisis talks with EU leaders, The Telegraph, 24 March  2011:

http://www.telegraph.co.uk/finance/financialcrisis/8404645/Portugal-debt-crisis-David-Cameron-holds-crisis-talks-with-EU-leaders.html

[117]            AP, Portugal ‘needs £70bn bailout’, The Independent, 8 April 2011:

http://www.independent.co.uk/news/world/europe/portugal-needs-70bn-bailout-2265130.html

[118]            Henry Chu, Europe scrambles to rescue Portugal from debt crisis, Los Angeles Times, 8 April 2011:

http://articles.latimes.com/2011/apr/08/world/la-fg-portugal-debt-20110408

[119]            James G. Neuger and Anabela Reis, Portugal’s $111  Billion Bailout Approved as EU Prods Greece to Sell Assets, Bloomberg,  17 May 2011:

http://www.bloomberg.com/news/2011-05-16/portugal-bailout-approved-as-eu-prods-greece-to-sell-assets.html

[120]            Julia Kollewe, Portugal downgrade hits European bank shares, The Guardian, 6 July 2011:

http://www.guardian.co.uk/business/2011/jul/06/portugal-downgrade-european-bank-shares

[121]            LIZ ALDERMAN and JACK EWING, Europeans Caution  Ratings Agencies After the Downgrade of Portugal’s Debt, The New York  Times, 6 July 2011:

http://www.nytimes.com/2011/07/07/business/global/07euro.html

[122]            Elysse Morgan, Ireland downgrade fuels Italy, Spain fears, ABC News, 13 July 2011:

http://www.abc.net.au/news/2011-07-13/ireland-downgrade-fuels-italy-spain-fears/2793156?section=business

[123]            John Glover, Italy Is Two Percentage Points From  Bailout as Yields Rise, Evolution Says, Bloomberg, 11 July 2011:

http://www.bloomberg.com/news/2011-07-11/italy-is-2-percentage-points-from-a-bailout-as-yields-rise-evolution-says.html

[124]            Fabio Benedetti-Valentini, Italian Debt Risk Puts  France’s BNP Paribas, Credit Agricole on Frontline, Blomberg, 13 July  2011:

http://www.bloomberg.com/news/2011-07-12/france-s-bnp-credit-agricole-on-frontline-with-italian-risk.html

[125]            Jeffrey Donovan, Italy Sells 6.75 Billion Euros of  Treasury Bills as Borrowing Costs Climb, Bloomberg, 12 July 2011:

http://www.bloomberg.com/news/2011-07-12/italy-s-borrowing-costs-soar-at-6-75-billion-euro-bill-sale-on-contagion.html

[126]            Guy Dinmore and Giulia Segreti, Draghi backs Italian austerity plan, The Financial Times, 13 July 2011:

http://www.ft.com/intl/cms/s/0/d114be22-ad2c-11e0-a24e-00144feabdc0.html#axzz1RpfP4VNB

[127]            Harry Wilson, Spanish banks have €100bn exposure to Portugal, The Telegraph, 8 April 2011:

http://www.telegraph.co.uk/finance/financialcrisis/8435903/Spanish-banks-have-100bn-exposure-to-Portugal.html

[128]            Jill Treanor, Debt crisis: UK banks sitting on  £100bn exposure to Greece, Spain and Portugal, The Guardian, 28 April  2010:

http://www.guardian.co.uk/business/2010/apr/28/debt-turmoil-bank-crisis-fears

[129]            Harry Wilson, UK bank exposure to Portugal is less than peers, The Telegraph, 8 April 2011:

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8436114/UK-bank-exposure-to-Portugal-is-less-than-peers.html

[130]            Ambrose Evans-Pritchard, Banks have £1.6 trillion  exposure to ailing quartet of Greece, Ireland, Portugal and Spain, The  Telegraph, 14 March 2011:

http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8379302/Banks-have-1.6-trillion-exposure-to-ailing-quartet-of-Greece-Ireland-Portugal-and-Spain.html

[131]            Patrick Jenkins and Megan Murphy, Bank contagion  fear resurfaces in the Eurozone, The Financial Times, 12 July 2011:

http://www.ft.com/intl/cms/s/0/f3efcbe2-aca7-11e0-a2f3-00144feabdc0.html#axzz1RpfP4VNB

[132]            CNBC, ECB Firefight Leaves It Exposed to Greek Shock, The Financial Times, 7 June 2011:

http://www.cnbc.com/id/43304981/ECB_Firefight_Leaves_It_Exposed_to_Greek_Shock

[133]            Jeff Black, BIS Urges Europe to End Its Debate,  Resolve Debt Crisis ‘Once and for All’, Bloomberg, 26 June 2011:

http://www.bloomberg.com/news/2011-06-26/bis-urges-europe-to-end-debate-and-resolve-debt-crisis-once-and-for-all-.html

[134]            Norma Cohen and Chris Giles, Central banks urged to raise rates, The Financial Times, 26 June 2011:

http://www.ft.com/intl/cms/s/0/481e5106-a01f-11e0-a115-00144feabdc0.html#axzz1RpfP4VNB

[135]            Elena Moya, Low interest rates risk relapse into recession, BIS warns, The Guardian, 28 June 2010:

http://www.guardian.co.uk/business/2010/jun/28/raise-interest-rates-avoid-recession

[136]            Simone Meier, BIS Sees Risk Central Banks Will Raise Interest Rates Too Late, Bloomberg, 29 June 2009:

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aOnSy9jXFKaY

[137]            Aaron Back, Beijing Raises Interest Rates Again, The Wall Street Journal, 7 July 2011:

http://online.wsj.com/article/SB10001424052702303544604576429393824293666.html

[138]            Julia Kollewe, ECB raises interest rates despite debt crisis, The Guardian, 7 July 2011:

http://www.guardian.co.uk/business/2011/jul/07/ebc-raise-interest-rates-debt-crisis

[139]            Jill Treanor, International banking regulator calls  for rates to be raised worldwide, The Guardian, 26 June 2011:

http://www.guardian.co.uk/business/2011/jun/26/international-banking-regulator-rates

[140]            We’re living in a plutonomy, The Telegraph, 2 April 2006:

http://www.telegraph.co.uk/finance/2935809/Were-living-in-a-plutonomy.html

[141]            Robert Frank, Plutonomics, The Wall Street Journal, 8 January 2007:

http://blogs.wsj.com/wealth/2007/01/08/plutonomics/

[142]            Ibid.

[143]            Michael Lind, Is America a plutonomy? Salon, 5 October 2010:

http://www.salon.com/news/opinion/feature/2010/10/05/lind_america_plutonomy

[144]            Gus Lubin, Deutsche Bank Says The ‘Global Plutonomy’  Is Stronger Than Ever, And That Means 10X More Volatility, Business  Insider, 17 February 2011:

http://www.businessinsider.com/ajay-kapur-plutonomy-2011-2

[145]            Tom Petruno, ‘The consumer isn’t overleveraged — the middle class is’, Los Angeles Times, 14 August 2009:

http://latimesblogs.latimes.com/money_co/2009/08/the-well-heeled-might-be-able-to-save-the-us-economy-from-a-long-period-of-dismal-consumer-spending—-if-only-we-dont.html

Report: Ground Invasion of Libya Within Two Weeks

Paul Joseph Watson
Infowars.com
July 4, 2011

US Troops

A hawkish Jerusalem-based news outlet with reported links to Israeli intelligence that has proven accurate in its forecast of future  geopolitical events claims that the war in Libya is approaching a “coup de  grace” and that French, British and American troops will land on Libyan soil  within the next two weeks to spearhead a full ground invasion.

In a piece entitled, US and NATO prepare final assault  on Qaddafi, DebkaFile cites military sources for its contention that  NATO powers are finalizing plans for a “large-scale, all-out military bid to  kill or oust” Colonel Gaddafi.

“The coming coup de grace, expected in the next  couple of weeks, is the hottest topic of discussion in the corridors of power  and high-level military and intelligence get-togethers in London, Paris,  Brussels, Moscow, Oslo, The Hague and Rome. It is expected to start in a couple  of weeks with French and British troop landings on Libyan soil, to be followed  in its last stages of by American forces,” states the report.

In military terms, “coup de grace” is a synonym  for ‘death blow’, and Debka views France’s announcement that it is providing  weapons to anti-Gaddafi rebels as a precursor for a ground invasion and “the  opening shot of the final act in the scenario for removing him.”

If the report is correct in its claim that a  ground invasion is imminent, it would mean that a plan for boots on the ground  originally scheduled for the end of October has been dramatically accelerated,  which is perhaps a reflection on the fact that Al-Qaeda-affiliated  rebels have thus far failed to depose Gaddafi.

As we  reported last month, sources from Ft. Hood, Texas as well as CENTCOM  contacted us to reveal that the 1st Calvary Division (heavy armor) and III Corps  were being deployed to Libya in late October and early November, and that a  total of 30,000 US troops would be in place by that time.

DebkaFile is a pro-Israel intelligence-gathering  website run out of Jerusalem. It has been labeled a media arm of Mossad, yet claims published on the website in  the past have proven accurate, including a 2000 prediction that terrorists would  attack the World Trade Center in New York.

In addition to Israeli sources, Russian Envoy Dmitry  Rogozin told RIA Novosti on Friday, ““I think that now we are witnessing the  preparation stage of a ground operation which NATO, or at least some of its  members… are ready to begin.”

According to a report in the Pakistani Observer, US, French and British Special Forces arrived in Libya on February 23 and  24, weeks before the UN “no fly zone” was even announced. More recently, Al  Jazeera broadcast footage showing armed  western military officials in Misrata appearing to converse with and  instruct Libyan rebels.

Back  in April, the EU announced that it had readied an invasion force for Libya  that would work to “secure sea and land corridors inside the country.”

Despite the fact that President Obama ignored his own  constitutional lawyers to launch a war without congressional approval, promising  the conflict would last “days, not weeks,” US involvement has now entered  its fourth month, with the Air Force and Navy, “still flying hundreds of strike  missions over Libya despite the Obama administration’s claim that American  forces are playing only a limited support role in the NATO operation,” according  to the Air Force Times.

Lawmakers in Washington are increasingly irate at  an intervention that has already  cost nearly a billion dollars, particularly with regard to how the  administration has ludicrously attempted to argue that America’s role in a  bombardment does not represent a “war,” in addition to Obama’s arrogance last  week in claiming he doesn’t “even  need to get to the Constitutional question” while justifying the war.

If these reports turn out to be accurate and an  invasion force is dispatched to topple Gaddafi, Obama could leave himself open  to impeachment proceedings because of his brazen lie to the American people when  he publicly stated that a land  invasion was “absolutely” out of the question.

Banker Occupation of Greece

Stephen Lendman
Infowars.com
June 26, 2011

photo
Photo: Apa.

Economist Michael Hudson calls it “Replacing Economic Democracy with Financial Oligarchy” in a June 5 article by that title, saying:

After being debt entrapped, or perhaps acquiescing to entrapment, the Papandreou government needs bailout help to pay bankers that entrapped them. Doing so, however, requires “initiat(ing) a class war by raising its taxes (harming working households most), lowering its standard of living – and even private-sector pensions – and sell off public land, tourist sites, islands, ports, water and sewer facilities” – in fact, all the country’s crown jewels, lock, stock and barrel, strip-mining it of everything of worth at fire sale prices.

Why? Because the US-dominated IMF, EU and European Central Bank (ECB), the so-called “Troika,” demand it as the price for bailout help that wouldn’t be needed if Greece wasn’t trapped in the euro straightjacket. Membership means foregoing the right to devalue its currency to make exports more competitive, maintain sovereignty over its money to monetize its debt freely, and be able to legislate fiscal policies to stimulate growth.

Instead they’re entrapped by foreign banker diktats demanding tribute. They call it a “rescue.” In May 2010, the Papandreou government agreed to earlier austerity in return for loans. Now they’re at it again, demanding more or they’ll collapse the entire economy, or so they say. And the same scheme is replicated in Ireland and Portugal. Moreover, it’s heading for Spain, and potentially most of Europe and America as representative governments head closer to “financial oligarchy.”

In other words, it amounts to financial coup d’etat authority over sovereign governments unless popular anger prevents it, involving more than street protests or short-term strikes accomplishing nothing.

Former Wall Street broker, financial analyst, radio/TV host, and consummate critic Max Keiser calls it “banker occupation” for good reason. They:

– make the rules;

– set the terms;

– issue diktats;

– pressure, bribe or otherwise cajole or force governments to acquiesce; and

– burden working households with higher unemployment, wage and benefit cuts, higher taxes, and other austerity measures to assure financial predators profit – always at their expense, forcing once prosperous nations to surrender sovereignty to financial oligarchs, ruling world economies like fiefdoms.

Hudson said European central planning concentrated financial power in “non-democratic hands” from inception under European Central Bank (ECB) dominance. Operating like a financial czar over its 17 Eurozone members, it:

– “has no elected government (to) levy taxes;

– (t)he EU constitution prevents (it) from bailing out governments,” unlike the Fed able to monetize US debt in limitless amounts; and

– “the IMF Articles of Agreement also block it from giving domestic fiscal support for budget deficits,” saying:

“A member state may obtain IMF credits only on the condition that it has ‘a need to make the purchase because of its balance of payments or its reserve position or developments in its reserves.’ ”

However, despite ample foreign exchange reserves, IMF loans are offered “because of budgetary problems,” precisely what it’s not allowed to do. As a result, “when it comes to bailing out bankers,” said Hudson, “rules are ignored” to save them and their counterparties from incurring losses. And it works the same way in America under the Fed, dispensing open-checkbook amounts to Wall Street on demand.


Webster Tarpley on how the bankers plan to use Greece as an example.

No wonder Hudson calls finance “a form of warfare,” operating like pillaging armies, taking over land, infrastructure, other tangible assets, and all material wealth, devastating nations in the process, causing unemployment, poverty, neoserfdom, “demographic shrinkage, shortened life spans, emigration and capital flight.”

Greece’s business-friendly fiscal legacy, in fact, caused today’s crisis, squeezing public spending in favor of the rich, especially with sweetheart tax policies letting much of their income go undeclared.

Financial deception followed. On February 8, 2010, Der Spiegel writer Beat Balzli headlined, “How Goldman Sachs Helped Greece to Mask its True Debt,” saying:

In 2002, Goldman helped them borrow billions by circumventing Eurozone rules in return for mortgaging assets. Using creative accounting, debt was then hidden through off-balance sheet shenanigans, employing derivatives called “cross-currency swaps in which government debt issued in dollars and yen was swapped for euro debt for a certain period – to be exchanged back into the original currencies at a later date.”

Debt entrapment followed, nations like Greece held hostage to repay it, the usual price being structural adjustment harshness, making a bad situation worse. In 2010, in return for a $150 billion loan, Papandreou imposed:

– large public worker layoffs (around 10% overall);

– public sector 10% wage cuts, including a 30% reduction in salary entitlements;

– cutting civil service bonuses 20%;

– freezing pensions;

– raising the average retirement age two years; and

– higher fuel, alcohol, tobacco, and luxury goods taxes, knowing much more lay ahead given Greece’s worsening debt problem.

More bailout help is now needed in return for greater austerity, as well as selling off Greece’s crown jewels as explained above. On June 24, New York Times writer Stephen Castle headlined, “Europeans Agree to a New Bailout for Greece with Conditions,” saying:

The deal “came a day after Greece agreed with international creditors to more austerity measures (requiring parliamentary approval) as part of revised plans for 2011-15 aimed at” assuring bankers are first in line to get paid, popular and national interests be damned.

An agreement in principle expects half the funds offered to come from new loans, a fourth from state asset sales, and the remainder from private sector contributions.

An unspecified larger amount (of around 110 billion euros in total) will follow an initial 12 billion euro emergency loan with strings. They include:

– laying off another 20% of public workers;

– privatizing public enterprises and assets on the cheap;

– a one-time personal income levy from 1 – 5%, depending on income;

– lowering the tax-free income threshold to 8,000 euros annually from 12,000;

– setting the lowest tax rate at 10%, with exemptions for people up to age 30, over-65 pensioners, and disabled people; and

– annually taxing the self-employed an additional 300 euros.

Up to $120 billion in cuts are expected though final figures haven’t been announced, depending on amounts raised from asset sales and private contributions.

In response, public anger is visceral through daily protests. The ruling PASOK party’s approval rating is 27%. Over 90% of the public are dissatisfied with Greece’s governance. Another 90% say the country is “on the wrong path.” About 80% are unhappy with their lives, and 70% are concerned that conditions will keep deteriorating.

Nonetheless, on June 22, Papandreou won a parliamentary vote of confidence ahead of two more steps the IMF and Eurozone leaders require before releasing more funds – agreeing on their demanded austerity plan and enacting measures to implement it.

In fact, acting IMF managing director John Lipsky (a former JP Morgan Investment Bank vice chairman) said no opposition will be tolerated. In other words, Eurozone nations have no option but to obey IMF diktats, Lipsky acting more like a commissar than banker.

At the same time, austerity, privatizations, and greater debt amounts are self-defeating. Workers, of course, are hardest hit unless mobilized mass action stops it. Ideally they can do it by general strike, shutting down the country, setting non-negotiable demands, staying out until predatory banker diktats are rejected, and prevailing by letting nations regain their sovereignty and people their rights.

That’s how labor battles are won. It works the same everywhere when rank and file determination stays the course to victory.

Originally posted on Steve Lendman’s blog.

 

 

Webster Tarpley & Elite’s Plan for Global Extermination

In this interview, Dr. Tarpley reviews the writings of John P. Holdren, the current White House science advisor. This interview conclusively exposes scientific elite’s true agenda, world-wide genocide and the formation of a global government to rule.

We encourage all our subscribers to watch this video now at Prison Planet.tv by visiting the “video reports” section.

Direct link:

Sample Movie Below.

Arrested for Dancing at the Thomas Jefferson Memorial (Ironic)

A flashmob in Washington has felt the full force of the law, by being forcibly arrested by police – for dancing in public. They’d gathered at the Jefferson Memorial in defiance of a ban on dancing at the monument. Among those held were RT America presenter Adam Kokesh, who says he was slammed to the ground by officers. The ban came in during 2008 when an activist sued police for arresting her for public dancing. The group say they were paying tribute to her as a champion of the First Amendment, guaranteeing freedom, and in response to US District Judge John D. Bates’ ruling that denounced dancing on the site.

Original Content

“Of liberty I would say that, in the whole plenitude of its extent, it is unobstructed action according to our will. But rightful liberty is unobstructed action according to our will within limits drawn around us by the equal rights of others. I do not add “within the limits of the law” because law is often but the tyrant’s will, and always so when it violates the rights of the individual.”
         –Thomas Jefferson

 

 

UPDATE ON THE ALEX JONES SHOW MAY 31, 2011:

 

FIRE WATER: Australia’s Industrial Fluoridation Disgrace

FireWaterFilm.com

‘FIRE WATER: Australia’s Industrial Fluoridation Disgrace’ (Part 1): A Sapphire Eyes Productions documentary exposing the systematic industrial waste poisoning of Australian drinking water supplies. ***This is an activist film put out for free to make a difference; please support the filmmakers at their site here.

Part 1Part 2Part 3Part 4Part 5  – Part 6Part 7Part 8Part 9

 

Produced and directed by Jaya Chela Drolma, researched and written by Daniel Zalec, this is a hard-hitting film that exposes the fraud of mandatory water fluoridation, perpetrated on the Australian people. ‘Fire Water’ proves once and for all that toxic industrial waste is being used to ‘fluoridate’ Australia’s drinking water supplies, forcibly. People and communities across the nation, however, are fighting back harder than ever before as they learn the shocking truth of fluoridation.

‘Fire Water’ is a groundbreaking collation of a wide variety of Australian perspectives on water fluoridation. From politicians, to doctors, to sufferers, this film goes to the heart of the issues — the chemicals, the ethics, the science and the lack of accountability of poisoners. A ‘must see’ film if you care about your health, the health of the environment and the future well-being of your children and grandchildren. Watch it, download it, share it. Get involved! It’s FREE to view at: www.firewaterfilm.com

DISCLAIMER: All views expressed in this documentary and related interviews, are the views of the individuals involved, and may not necessarily represent the views of Sapphire Eyes Productions, its employees, affiliates or associates.

PREVIEW — FIRE WATER – CINEMATIC TRAILER

 

Trailer: Webster Tarpley & Elite’s Plan for Global Extermination

Prison Planet.tv
May 18, 2011

This is the trailer for the upcoming PrisonPlanet.tv exclusive interview with Dr. Webster Tarpley. In this interview, Dr. Tarpley reviews the writings of John P. Holdren, the current White House science advisor. This interview conclusively exposes scientific elite’s true agenda, world-wide genocide and the formation of a global government to rule.

Click here to subscribe to Prison Planet.tv and get exclusive access to this interview along with a mountain of other special video interviews and reports, as well as daily high quality video and audio archives for the Alex Jones Show , in addition to the live in studio video stream.

 

 

 

 

What do the elite want with the global population?

WATCH ALEX JONES’ ENDGAME: BLUEPRINT FOR GLOBAL ENSLAVEMENT FOR A HARDCORE PRIMER INTO THE AGENDA TO IMPLEMENT A RULING SCIENTIFIC DICTATORSHIP WHICH WILL EXTERMINATE 80-90% OF HUMANITY


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