In 2014, a Bank of England report titled: "Money Creation in the Modern Economy" finally admitted what has been known by many for a long time: that 97% of the money supply is now created by banks when they make loans. Most of that money is, and remains throughout its life cycle, digital rather than 'physical' paper money.
The second thing you have to first understand is that nation states are more like corporations and their populations are treated as employees of that corporation. The directors of the corporation are banks and bankers.
As the 'directors' of the corporation/nation, bankers take employees'/citizens' expendable income and gamble with (invest) it on the international market, promising, but not always delivering, a profit to the employees/citizens, but ensuring to always make a profit for themselves. Note, private banks sometimes do this with the explicit consent of the employees/citizens, but mostly they do it without their consent to generate profits for themselves.
Starting around 2001 at the beginning of the Euro era, banks in many EU states began to aggressively push loans on people who could not really afford them. In our rampantly consumerist society, poorer people are more likely to accept offers of money to buy things they don't really need, and bankers know it. Of course, in the case of mortgages or 'remortgages' and car loans, the house and the car are often used to secure the loan.
Bankers did this because banks can only "create money" by loaning money to citizens. Of course, this is a patently ridiculous idea that hides the actual truth: that what is "created" is debt, and that debt is secured by the possessions and "sweat equity" of the citizens. That's why when banks "go broke", the "bail out" they receive from public funds always translates to ordinary people having to work harder for less and/or losing their possessions. Many citizens end up committing suicide as a result, which I suppose could be seen as the most extreme example of equity transference.
Among other indices, the level of success enjoyed by bankers' investing (gambling with) citizens' salaries and the likelihood that the citizens will be able to pay back their loans, determine whether or not a nation state/corporation is a good or bad investment for other international financial investment institutions and individuals. These buy 'stock' in the nation state in the form of government bonds with the government promising to repay with interest at a later date. Whether or not the investor will ultimately be repaid is based on the 'economic health' of the nation state/corporation at any given time.
But bankers were not content with merely gambling with citizens' actual disposable income. They also came up with the wonderful idea of trading the debts that citizens held with the banks. But many of those debts were for mortgages and other loans that had been pushed on people who were very unlikely to be able to pay them back. So who would in their right mind buy such dodgy assets? The solution lay in the ingenious idea of simply lying about the rating of the loans. With a few strokes of a pen or keyboard, bundles of mortgages that were effectively toxic debt became 'high grade' debt. In a perfect example of the fundamentals of fractional reserve banking, a pile of worthless paper became gold!
As was completely foreseeable, when the music stopped on this farcical money-go-round, a lot of banks were left 'holding the baby'. They held loans worth nothing for which they had paid good money. Whose money? Your money! Greek people's money! Irish people's money, etc. After all, that's what's mostly in banks. But where did the money go? For sure, certain banks and high level investors made out like bandits, because that's what they are, but most of the money appears to have just 'disappeared'. It was taken out of the global market and replaced with a decrease in the living standards of millions of people.
But it gets worse. Even though it was now acknowledged that the mortgages and other loans given to hundreds of millions of citizens would never be repaid and would have to be written off, as far as the bankers were concerned, the debt was still owed by the citizens who held it, so citizens' possessions, like the cars and houses that secured those loans, were repossessed by the banks.
But it doesn't end there. The fact that many banks were now technically insolvent, having gambled with and lost the people's money, decreased the overall financial health of the country in question, and all those investors that had bought government bonds in that country/corporation were concerned about getting their bond money back. But there was no money because the bankers had "lost" it! The only solution was to 'recapitalize' the banks by ploughing billions into them. Where did that money come from?
In the case of Europe, primarily from the institutions like the European Central Bank (ECB) and the International Monetary Fund (IMF), with the ECB and other EU financial bodies contributing the lion's share. But where did the ECB et al. get the money? From European taxpayers!
But the ECB and IMF weren't about to give Europeans their own money back without extracting their pound of flesh. To "save the banks" they demanded that the national government of the country "in crisis" pass laws that would effectively make the people pay (again) by effectively funding the bank bailout through reducing pensions, public worker salaries, social welfare payments, spending on healthcare and general spending on things that improve people's lives and allow them to live with some dignity. In many cases, nations were also ordered to sell off public services to private corporations, increasing the cost of basic services like water, electricity, public transport, etc.
Getting back to Greece specifically; by 2008 and the "global financial crisis", Greek banks, like most others, had been engaging in this reckless gambling with other people's money for years. Due to the size of the Greek economy, its natural resources and the fact that it isn't a major financial 'partner' in the EU, Greek banks lost more of their shirts than most others. Ireland was in a similar sinking boat along with Spain and Portugal. So Greek banks needed "recapitalization" (bailouts) and they got them from the IMF and ECB.
In the last 5 years "Greece" got €240 billion in bailouts, most of the money coming from European taxes. But about 90% of that €240 billion went right back to large international "banking houses" and other financial institutions who had both recklessly loaned to, and invested in, the Greek state. The other 10% went to the Greek government to keep the country running, i.e. paying the salaries of doctors, teachers, etc.
So over the past few months the Greek people have been told that the bailouts that they didn't actually receive must be repaid by them in the form of raising taxes, cutting pensions, salaries, social welfare payments, privatization, etc.
If you're now wondering how any of this "Greek debt crisis" has anything to do with any actual debt owed by the Greek people, then you're on the right track. In essence (and I know this is a complicated topic), after defrauding the Greek people of their money for years and causing a crisis in the Greek economy for the past 6 years, during which time many Greeks lost their jobs and the Greek economy was ruined, international bankers are now demanding that the Greek people suffer more by paying back money they already lost to the bankers and which has already largely been paid back (allowing for the fact that it's all "funny money" to begin with and the real 'currency' here is the energy and lives of ordinary people everywhere).
As of this writing, the Greek government appears to have capitulated to the demands from 'creditors' that, while the Greek people may still hold to quaint notions like 'democracy', the reality is that they, like 99% of the population of the planet, are little more than assets to be exploited, 'consumed' and eventually discarded when no more 'capital' can be squeezed from them.
On the positive side, at least the Greek government tried to represent the best interests of the Greek people, and made the effort to allow them to voice their disgust at such treatment. The Brits, on the other hand, had precisely the same kind of "austerity measures" foisted upon them in the recent national budget, and were told it was wonderful.
As an essayist and print author, Joe has been writing incisive editorials for Sott.net for over 10 years. His articles have appeared on many news sites and he has been interviewed numerous times by Sputnik News and Press TV. His articles can also be found on his personal blog JoeQuinn.net.
Reader Comments
the coming change in IMF global currency? It's the way the bankers 'turn the corner.'
Well now, let's put those nasty old crisis times behind us, shall we? My gosh, nobody is really sure what happened so let's just say Goodby to that whole mess and enjoy the good times, shall we? Things will be a tad confusing, the new money and all, but we, your friends, are here to help you thru it. why, with all the helter-skelter of watching this pile of money go there, and Whoops? where did it go? And hearing about all the new regulations we're sure you wont remember the dollar. This will be more fun than a house of cards!!
You vote for capitalists - - - > You do like banks
it works either way
(surprise) :-)
As you noticed Bar Korhba, ondrejdvorak seems to be suffering from black and white thinking. This money system is a nondiscriminatory abuser. Here is a link to the top 50 banks in China: _[Link]
In the United States we also have the Federal Reserve which cannot be audited and loans and prints the U.S. government's "money" which tax payers are responsible to repay. The Federal Reserve is in no way "Federal" it is is a private banking cartel. But in addition to this "fiat" money machine you can add the private banks which are allowed to make loans with only 10% of the actual money deposited in the bank. This is called "Fractional Banking". In a sense this makes banks mini-federal reserves creating more "fiat" money. At least this is the way I see the illusion.
You could also keep in mind the IMF which the U.S. is the major contributor and the U.S. taxpayers are responsible for the contributions.
Joe,
By Jove (Joeve?) I think you've got it! I am delighted that someone points out "the emperor has no clothes". Once you do the research and find out what is really going on it is certainly obvious how depraved and ridiculous the financial world is. I only wish there were more like you.
Management (organized crime--global governance and finance) 'responds' to Joe Quinn:
We own the paper.
We own the scissors.
We own the rock.
Have fun writing your pieces (and this one too, is quite good--NED), but don't do anything you shouldn't. In other words, don't imagine or pretend that any of it belongs to you.
It is ours, we have killed (and maimed) and killed (and maimed) and killed (and maimed)for years in order to get 'it' and we don't intend to stop killing (and maiming) now or any time soon.
MIND CONTROL.
Material management.
We control your mind (and manage your material), so you don't have to, don't dare to.
p.s. (by ned): I really like Joe Quinn (for the most part) but we need so many more (people), that will attempt to DO. Ordinarily, men cannot 'do'. They only think they do. The list of 'thinkers' is very LONG. And boring.
Joe wrote: "...As the 'directors' of the corporation/nation, bankers take employees'/citizens' expendable income and gamble with (invest) it on the international market, promising, but not always delivering, a profit to the employees/citizens, but ensuring to always make a profit for themselves. "
That's very true. In addition, the income received by the 'citizens' keeps shrinking relative to the total national wealth. Here is an interesting chart:
[Link]
It shows that in 1970, wages represented 54% of the U.S. GDP. It had dropped to 43% in 2012.
[Link]
As the saying goes, you can know a person by the quality of his or her enemies. This is also true of societies, where moral evolution can be traced by simply listing the things on which they declare war. Not so long ago, for instance, the world’s good guys — the US, Europe’s democracies and a few others — fought existential battles against fascism and communism. Then they went after poverty and discrimination. They were, at least in terms of their ideals, on the side of personal freedom and opportunity and against institutionalized control.
But then came the war on drugs, in which the US imprisoned millions of non-violent people guilty only of voluntary transaction. Not long after that we declared war on “terror,” using the enemies created by our own incompetent foreign policy as an excuse for a vast expansion of surveillance and police militarization.
And now, seemingly out of nowhere, comes a new enemy: cash. Around the world, governments and banks are making it harder to save and transact with paper and coin. The ultimate goal seems to be the elimination of private tools of commerce, in favor of transparent (to governments and banks) plastic, checks and online payment systems. The following excerpts are from longer articles that should be read in their entirety:....continued
....No one discusses how, on a whim, anyone in government with power could 'turn off' your electronic cash, and you would be rendered incapable of purchasing food, or taking a subway, or pretty much anything else. Political dissident? Your magic money card stops working. Don't pay a parking ticket? They reach in and take it by threatening to 'turn you off'
Talk about 'ultimate control'!
More and more people and organizations are becoming adept at identifying the evil injustices which have invaded every facet of our lives.Of all the identified enemies of humanity, there is one enemy which stands out among all others.
Pogo is correct. It is we the people who have become adept at mastering the craft of perpetuating our own enslavement. We provide the labor and the capital which enslaves us. This article illustrates one small example of how we are being enslaved and more importantly, what we can do about it.
Whether it is banking, healthcare or even public education, the globalists have virtual control the entire system. They also control the dialogue through their domination of the mainstream media and they do so to their advantage and to our extreme detriment.
This article will take a very brief look at banking and then propose solutions based upon common sense and from the field of psychology which could be used to mitigate the effectiveness of the globalists on a broad front in this arena.
Stop Feeding the Beast.......continued
[Link]
You do like banks - - - > You vote for capitalists
is that simple enough for you?