Thursday, April 20, 2017

Money Matters: An IMF Exhibit -- The Importance of Global Cooperation. Destruction & Reconstruction (1945 - 1958)

The Post War World

The Most Destructive War in History

By the end of World War II, much of Europe and Asia, and parts of Africa, lay in ruins. Combat and bombing had flattened cities and towns, destroyed bridges and railroads, and scorched the countryside. The war had also taken a staggering toll in both military and civilian lives.

Shortages of food, fuel, and all kinds of consumer products persisted and in many cases worsened after peace was declared. War-ravaged Europe and Japan could not produce enough goods for their own people, much less for export.

What was needed to pull Europe and Asia back into the international economy? The answer was money - but what kind? The currencies of war-torn countries? Gold? Dollars?

The Most Expensive War in History

In addition to the toll in human lives and suffering, countries spent more money on World War II than in all previous wars put together. By 1945, exhausted countries faced severe economic problems that frustrated reconstruction efforts:

  • Inflation
  • Debt (mostly owed to the United States)
  • Trade deficits
  • Balance of payments deficits
  • Depleted gold and dollar supplies

The Dollar Gap

Dollar Gap
The devastated countries needed gold or U.S. dollars (the only currency considered to be "as good as gold") to pay for imports and make debt payments. However, both dollars and gold were alarmingly scarce in the war-scarred countries.

Many countries retreated from the market. Communist Eastern Europe abandoned it altogether. The world’s multilateral financial and trading system faced a serious threat. Only the United States had emerged from the war with the strength and resources to help. But would it step forward?

Worldwide Gold Shortage

By 1947, the United States had accumulated 70% of the world’s gold reserves. The United Kingdom had gone from being the world's greatest creditor to the world's greatest debtor. Countries had sold off most of their gold and dollar reserves, as well as their foreign investments, to pay for the war. What few reserves remained were now quickly running out. Trade deficits meant there was little hope of replenishing them.

Five cigarettes for an egg? A carton of cigarettes for a piano?

Severe inflation plagued the weakened economies. By 1948, wholesale prices were 200% higher in Austria, 1,820% higher in France, and a massive 10,100% higher in Japan than they had been before the war. In 1948, the French government devalued the franc by 80%, making a 5,000 franc note practically worthless. In some countries like Germany, the monetary system collapsed. People resorted to barter, often using cigarettes as money.


Cooperation Tested

Cooperation Tested
Cooperation Tested
The economic situation looked grim in 1947. Forty-four countries had agreed to international economic cooperation at Bretton Woods, but the IMF and the World Bank were not yet in a position to provide the needed expertise and financial assistance. Would countries return to the unilateral beggar-thy-neighbor policies of high tariffs and competitive devaluations?

Potential Solution

Many hoped that the United States would provide economic aid to help resolve the crisis. In contrast to the other combatants, the United States ended the war as the world's greatest creditor, with most of the world's gold, a substantial balance of payments surplus, and virtually no physical damage to its own land. Would the United States offer additional dollar aid? Could the European countries cooperate with one another and the United States to solve their persistent problems and return to prosperity?

Limited Options for Economic Recovery

Desperate countries could gain the dollars they needed only through:

  • Exporting more than they imported (balance of trade surplus)
  • Private investments or loans from the United States
  • U.S. government aid or loans

However, the devastation caused by the war eliminated any hope of a trade surplus. Chaos and uncertainty in the European economies discouraged private US investments. It seemed that only additional government aid or loans could work.


Cooperation

Trade Links Encourage Expansion:

  1. The United States gives dollars to Country A.
  2. Country A uses dollars to increase domestic production and pay for imports.
  3. Country A's economy expands by selling more domestic products to, and buying more imports from, other countries.
  4. Other economies (including the U.S. economy) expand by selling more domestic products to, and buying more imports from, Country A.

Noncooperation

Noncooperation
Without Trade Links, Economies Miss Out on Expansion:

  1. The United States does not provide dollars to Country A.
  2. Country A is unable to increase domestic production and unable to afford imports.
  3. Country A's economy fails to expand, with few products to export and little foreign exchange to buy imports.
  4. Other economies (including the US economy) fail to expand, unable to sell domestic products to, or buy imports from, Country A.

US Decision

The Case Against

Over $9 billion had been spent already on aid to Europe in the immediate postwar period:

  • The United States could not afford to give away more money to other countries. There were pressing needs at home.
  • Existing shortages in the United States would be exacerbated and wholesale prices would rise, causing inflation.
  • If the United States did nothing, Europe would solve its own economic problems.

The Case For

The United States must act for security, humanitarian, and economic reasons:

  • If the United States did not help, Soviet-supported Communists could make inroads into vulnerable Western European countries.
  • Innocent people in Europe were suffering from shortages of basic necessities.
  • The United States could lose its main export markets if Europe could not find dollars or gold to purchase US products.

"And yet the whole world of the future hangs on a proper judgment...What are sufferings?What is needed?What must be done?"
George C. Marshall,
US Secretary of State
Harvard University,
June 5, 1947

Cooperation for Recovery: The Marshall Plan

Dollar Catalyst

Dollar Catalyst
In his historic speech at Harvard's graduation ceremony in June 1947, George Marshall announced the U.S. plan to give additional economic aid to Europe. The offer was made to all of Europe, including the U.S. wartime enemies and the Communist countries of Eastern Europe. However, the recipients would be required to work together to formulate a unified recovery plan.

The European Response
"When the Marshall Plan proposals were announced, I grabbed them with both hands. I felt that it was the first chance we had ever been given since the end of the war to look at [the] European economy as a whole."
Ernest Bevin
British Foreign Secretary
Sixteen European countries responded by cooperating on a general reconstruction plan that was accepted by the United States. In the end, a total of $13.6 billion (equivalent to $88 billion in 1997 money) was appropriated to the plan. The Marshall Plan was a success. By 1950, the participating countries had returned to, or exceeded, their prewar production levels.

The European Recovery Program (ERP - The Marshall Plan) helped Europe to:

  • Finance its imports and debts without the burden of future repayment
  • Replace, rebuild and expand both private industry and public infrastructure
  • Eliminate bottlenecks in production
  • Restore consumption to a politically acceptable level
  • Establish and fund the European Payments Union to promote multilateral, rather than bilateral, trade
  • Eliminate the worldwide dollar shortage

Conditionality

Marshall aid came with "conditionality" - countries wishing to participate had to agree to:

  • Develop multilateral payment and trade within Europe
  • Move toward currency convertibility
  • Move toward eliminating discrimination against U.S. imports
  • Encourage reductions in public spending
  • Relax government controls such as rationing
  • Increase exports to the United States


U.S. Dollars: Fueling the Economy

Even after Marshall Plan aid ended, the United States continued to provide economic assistance to other countries. In addition, as the "Cold War" heated up, US military expenditures abroad rose, particularly during the country's involvement in the Korean War (1950-53). And even more important, US investment abroad grew substantially after World War II.

The outflow of US dollars provided liquidity, which fueled the growing world economy.

IMF Loans

Egypt's 1956 takeover of the Suez Canal provoked an unsuccessful and costly joint U.K.-French military operation. The United Kingdom and France suffered severe financial consequences as a result. They turned to the IMF, which provided them with its largest financial assistance to date.

  • $262 million to France
  • $1.2 billion to the United Kingdom

US Government Foreign Aid and Spending

Just as the Marshall Plan aid was ending, US military and nonmilitary aid picked up. The continuous outflow of US dollars helped reduce Europe's balance of payments deficit and the worldwide dollar shortage.
US Government Foreign Aid and Spending
US Government Foreign Aid and Spending


Economic Miracles in the 1950s

Europe had recovered its prewar productive capacity by 1950; Japan, by 1952. Their economies grew rapidly over the following decade. As a result, international financial accounts gradually moved toward balance. The dollar shortage had been eliminated.

The System Works

In 1958, the monetary system agreed upon at Bretton Woods was validated when eleven European countries declared their currencies externally convertible. Others were to follow in the next few years.

The dollar-gold exchange standard, based on fixed exchange rates and overseen by the IMF, could finally be realized.

Problems on the Horizon

Economic Miracles in the 1950s
After 1950, the United States began to register balance of payments deficits. At first, the deficits were welcomed, because the United States enjoyed:

  • A strong trade balance
  • Ample gold reserves
  • A small outflow of private capital

The U.S. government believed that the deficits demonstrated US leadership in providing expanding markets and finance. The US balance of payments deficits provided $7 billion of an $8.5 billion increase in world liquidity during the 1950s. The increase in liquidity enabled the international economy to grow at a record rate.

How long could the United States afford huge deficits without harming its own economy?

And if the United States reduced its deficits, who would provide additional liquidity to allow the world economy to continue growing?

By International Monetary Fund

Source: International Monetary Fund

Thursday, April 13, 2017

Money Matters: An IMF Exhibit -- The Importance of Global Cooperation. Conflict and Cooperation (1871-1944)

The Golden Era

From the 1870s until World War I, the United Kingdom served as the leading financial and banking center of the world, while gold ruled as the monetary standard of all the major trading countries. Each country pegged its currency to gold at a constant and unchanging rate. The international gold standard system ushered in a period of unprecedented stability and prosperity - at least for the middle and upper classes in the industrial countries.

Gold and Stability

Gold and Stability
The gold standard provided monetary discipline. Because governments were required to convert domestic currency into gold on request, the amount of currency they could print was limited by the amount of gold in their reserves.

Exchange rates never varied in the classical gold system. This made exchanging money much easier for travelers. American Express even printed the exact amount of foreign currency exchange right on its traveler's cheques.

Industrial Revolution

Technological advances in the nineteenth century produced more goods and created more efficient ways of transporting them across national borders. Governments increasingly recognized the need for easy and convenient currency convertibility. The United Kingdom, economic and financial leader of the world, had based its currency on gold since the early nineteenth century. In the 1870s, Germany and other major trading countries followed its lead and converted to the gold standard.


Meltdown

Economic Consequences of the PeaceWorld War I marked the end of an economic era. Faced with an urgent need for more liquidity, the combatant countries took their currencies off the stabilizing gold standard and printed more money. This triggered high inflation, which persisted after the war.

Economic Consequences of the Peace

The postwar settlement, known as the Treaty of Versailles, exacerbated tensions and economic instability rather than fostering growth and cooperation. The European allies, especially France and the United Kingdom, felt that the losers should compensate them for the cost of the war by paying reparations. In 1921, Germany's reparations alone were fixed at 132 billion gold marks almost twice its prewar national income.


Cost of the World War

Cost of the World War
As this contemporary illustration graphically shows, the cost of the "World War" was staggering when compared with the costs of earlier hostilities. Governments were forced to stop redeeming their currencies for gold, since they had to print so much paper money to pay for the war.

Postwar Conundrum

  • The defeated countries had no gold to pay their reparations. Their economies were exhausted, and the peace terms offered little hope of earning gold through exports.
  • Without the reparations money, the allies could not repay their war loans from the United States.
  • The United States refused to cancel the allies' debts, insisting that the loans represented commercial transactions. 

What will "the next war" cost?

Impossible Debt

Finally, the German, Austrian, Hungarian, Polish, and Bulgarian monetary systems collapsed under runaway inflation called hyperinflation. The United States loaned money to Germany through the Dawes Plan. This loan, along with private investment, enabled the defeated countries to make scaled-down reparations payments. However, the victors collected only a small fraction of the reparations, and the United States eventually had to cancel the remaining debts of its allies.


Global Depression

Normalcy returned with the reestablishment of the gold standard in the mid-1920s, but imbalances plagued the monetary system. The prewar fixed exchange rates no longer reflected the relative economic strengths of the major countries:

  • The U.K. pound was greatly overvalued.
  • The U.S. dollar and French franc were undervalued.

The Great Depression Arrives

Global DepressionBy the end of the decade, economic and financial troubles had spread around the world. Many factors contributed:

  • A decline in prices of primary products devastated the economies of such countries as Argentina, Australia, and Chile.
  • Beginning in 1928, Americans cut back on their investments abroad to capitalize on the booming U.S. stock market. The loss of capital hurt first Germany, which counted on US investments to pay its war reparations, and then the European victors, who relied on Germany’s reparations to repay their own war debts.
  • The 1929 US stock market crash left the United States in financial chaos and accelerated the withdrawal of capital from abroad.

Trade, production, and employment rates fell throughout the world in a dizzying spiral. The Great Depression had arrived. How would the world respond?

International Response:

Beggar-Thy-Neighbor Policies

Instead of cooperating with one another, countries tried to solve their economic problems unilaterally.

To protect domestic industry:

  • Governments devalued their currencies to make their exports cheaper for foreign buyers and to make imports more expensive for their own citizens.
  • Governments also raised tariffs to make imports more expensive for their own citizens.

By selling more and buying less abroad, countries should have created jobs at home and improved their balance of payments positions. But one country’s exports are another’s imports, so these policies, adopted by many countries at the same time, only succeeded in drastically decreasing world trade and worsening the depression.

Worldwide Financial Chaos

Austria’s largest bank, the Vienna Kreditanstalt, collapsed in May 1931. Banking panic spread into Germany and Hungary and eventually forced the United Kingdom off the gold standard. Other countries soon followed in abandoning gold.

Failure to Cooperate

A World Monetary Conference was held in London in the summer of 1933, in hopes that a cooperative effort to restore prosperity might succeed where unilateral attempts had failed. The organizers sought agreement on:

  • Restoring the gold standard
  • Reducing tariffs, import quotas, and other barriers to trade
  • General international coordination of economic policies

Unfortunately, the conference failed. Participants could not come to any significant agreement.

Depression Lingers

The results of the world’s failure to cooperate were devastating. Continued unilateral efforts by individual countries only succeeded in deepening and prolonging economic woe.

  • World unemployment peaked at nearly 30% in 1932 and remained in double digits through the decade.
  • German and US production dropped to 53% of their 1929 levels.
  • One nation after another abandoned the gold standard in the 1930s.
  • Regional trading blocs and bilateral clearing arrangements replaced multilateral trade, making international trade more difficult.
  • Closed currency blocs replaced the international gold standard, further inhibiting trade.

At its lowest point, total world trade sank to just 35% of its 1929 value.

Keynesian Revolution

To help alleviate the Great Depression, some countries adopted policies based on the theories of economist John Maynard Keynes. Keynes argued that during slow economic times, the government should jump-start the economy by spending money to create jobs and boost demand.

The Works Progress Administration (WPA) in the United States was an example of the Keynesian approach. In the end, massive military spending finally succeeded in stimulating the global economy and ending the Great Depression.

Political Consequences

The political consequences of the mistakes made after World War I and during the Depression included the rise of totalitarianism and the outbreak of World War II.


The End of the War is in Sight. . .

Road to Cooperation

The End of the War is in Sight
The desire for economic cooperation stemmed from fear of repeating the post-World War I mistakes that had led to inflation, financial instability, and the Great Depression. While World War II still raged, Allied policy makers debated several plans for international monetary stability:

  • The U.S. proposal by Harry Dexter White
  • The U.K. proposal by John Maynard Keynes
  • Proposals from France and Canada

Keynes called for an International Currency Union, which would function as a "central bank" for the central banks of each country. White, on the other hand, called for a fund to which all member countries would contribute. Both agreed on fixed, but adjustable, exchange rates based on gold.

Bretton Woods

Travel to the United States was difficult and treacherous in the midst of the war, but, incredibly, representatives from 44 countries managed to gather for a conference at Bretton Woods in New Hampshire. Their ambitious goal - to design the framework for postwar international economic cooperation. D-Day had taken place three weeks previously, giving the delegates hope that the war would soon end.


How Could Leaders Ensure a Future of Global Peace and Prosperity?

New Economic World Order

The Bretton Woods meeting was a smashing success. After much delicate negotiation and hard work, the delegates agreed on the fundamental principles of a new monetary system to encourage economic stability and prosperity. Two intergovernmental institutions were created to further these principles:

  • The International Monetary Fund
  • The World Bank

Soon after, delegates meeting at Dumbarton Oaks in Washington, D.C., set up the United Nations, the political counterpart to the Bretton Woods institutions.

International Monetary Fund and World Bank

Bretton Woods: July 1-22, 1944

The Bretton Woods meeting resulted in the founding of the IMF and the World Bank, twin intergovernmental pillars supporting the structure of the world's economic and financial order. The World Bank finances economic development, while the IMF oversees the international monetary system.

The IMF

IMF
The founders felt that a fundamental condition for international prosperity was an orderly monetary system that would encourage trade, create jobs, expand economic activity, and raise living standards throughout the world. The IMF was charged with:

  • Helping each country set a fixed, but changeable, exchange rate for its currency based on gold
  • Assisting members that have temporary balance of payments difficulties by providing short- to medium-term credit
  • Overseeing the international monetary system


United Nations

Dumbarton Oaks: August 27-October 7, 1944

The Dumbarton Oaks meeting resulted in proposals to create the United Nations, an intergovernmental forum for solving international problems and disputes. The proposals were adopted at the subsequent meeting in San Francisco in 1945.

John Maynard Keynes (1944):
"All of us here have the greatest sense of elation. All in all, quite extraordinary harmony has prevailed. As an experiment in international cooperation, the conference has been an outstanding success."

By International Monetary Fund

Source: International Monetary Fund

Saturday, April 8, 2017

The Bretton Woods System and the golden age of capitalism

Bretton Woods System
By 1943, it became increasingly clear that WW2 was going to end in success for the Allied forces, and thus there was increasing interest amongst politicians and economists regarding post-war re-construction. In 1944 in the New Hampshire town of Bretton Woods, 44 allied nations agreed on a new system of international monetary management which, it was hoped, would promote stability and ultimately, peace.

A well-known and inescapable trade-off in monetary economics is that a country with its own currency can either choose a fixed value for its currency vis-a-vis other global currencies, or it can choose a floating value for its currency, whereby the market determines exchange rates relative to other global currencies. There are merits and drawbacks of both systems, with some countries having tried to establish a half-way solution with varying success. A fixed system is advantageous for trade as it reduces uncertainty around a country's values of imports and exports. A floating system however, allows monetary responses to shocks (such as recessions, or high demand during war). The norm since 1870/80 was for all major economies to have a fixed exchange rate system based on free convertibility to gold (this has become known as the ‘Gold Standard'). During the period 1870-1914, global trade tripled. The huge gains from international trade in the 19th century and an absence of stability costs (such as cyclical unemployment) resulted in the persistence of a global fixed exchange system.

The onset of the Great Depression, however, undermined this global consensus on the advantages of the Gold Standard. A collapse in global trade (assisted by the erosion of free trade and the adoption of protectionist policies) significantly reduced the trade gains of a fixed system. Furthermore, programs of fiscal and monetary expansions and competitive devaluations to combat the depression required a degree of flexibility which was not achievable within a fixed system. Thus, in the years running up to the beginning of WW2, many countries abandoned the Gold Standard which, arguably, further heralded the coming of global conflict.

John Maynard Keynes and his American counter-part Dexter White were the principal economists behind the design of a new fixed exchange system – the Bretton Woods system. There emerged a broad consensus amongst the allies that sustained peace would be brought about by eliminating high tariffs, trade barriers, and unfair economic competition so that no nation would become jealous of another's living standards which could ultimately breed the grievances that lead to war. The US also had an incentive to depart from the reparation policies and isolationist stance it had taken in 1918 and to provide liquidity and dollars to the war-ravaged countries of Europe to stave off a growing fear of communism sweeping the continent. The Bretton Woods system ultimately sacrificed capital mobility (the ability for investors to freely move capital from one country to another) so that countries could have a fixed exchange rate (all currencies were pegged directly or in-directly to the dollar, which in turn was pegged to gold). However, governments could also pursue expansionary monetary and fiscal policies by restricting trades in currency, so that effective Keynesian demand policies (such as public works programs) could be enacted in the post-war period.

The widespread adoption and acceptance of this system by the non-communist nations after WW2 helped to spur a so-called 'Golden Age' of capitalism, where rapid growth in productivity and living standards was witnessed across the developed world. The importance of global stability ensured by the functioning of the Bretton Woods system facilitated the prosperity of this period and indeed led UK Prime minister Harold Macmillan to proclaim in 1957 that the British people had 'never had it so good'. However, the Bretton Woods system was ultimately flawed, and would only last until the 1970s, ending any notion of a 'Golden Age' and plunging the global economy into a decade of low growth and recession.

By Philip Duffy

Source: ROM Economics

Saturday, April 1, 2017

An interview with a former Swiss banker

Here is an interview hosted by one of our representatives from the United States, Mr. Yves Jacques. ("YJ").

He recently spoke to Francois de Siebenthal. ("FS"), who is a former banker from Switzerland,

Interview Subject: The crisis in the financial world today and what solutions he would suggest to correct the chaos that is occuring.
       
The Interview Begins:

François de Siebenthal
François de Siebenthal
YJ: Francois, you are from Switzerland, trained as a professional banker and economist, is that correct?

FS: Yes.

YJ: And you’ve been an economist for how many years?

FS: For more than twenty-five years.

YJ: Some textbooks and other sources mislead people by saying that banks lend from the depositors savings. Can you tell us what really happens?

FS: The truth is that credit makes deposits, and not the other way around. This means that, for example, more than 90% of the money in circulation was created out of thin air. We can estimate that 99.99% of the United States dollar was created out of nothing. We call that Fiat Money, or Ex Nihilo. The problem is that, on the whole, they have been using the credit system to sustain the growth of the United States, to conserve the American economy at the cost of the poor of the world.

Recently the financiers even used the real estate market of the United States to uphold the credit industry. They have created massive amounts of credit (Ex Nihilo) as loans for real estate, and then sold the American mortgages to investors such as Fanny Mae and Freddie Mac at huge profits. They then used the massive import of funds and savings from all over the world to tell the American people that the value of the American industry is rising all the time. But now we have reached a limit in credibility and it (the American dollar) is starting to downslide. It has lost 60% of its value already since the beginning of the Iraq war. The entire system is a lie, and it is causing a massive lack of confidence, and of faith…

When credit is created only to sustain the virtual growth of the economy, there are various ways to get out of it. One of them would be to create a general war with millions of victims, or a bloody revolution, or even a credit crunch such as Japan experienced with its liquidity trap and massive depopulation, or then again, a general collapse of the economy such as what happened in 1929.

YJ: So, this is their solution?

FS: Yes, from my point of view the International Bankers are planning new wars and revolutions. I think that the best solution would be to do as the poor people of the United States did in 1929; establish local banks with 6,000 local currency systems. We can improve all those local systems and coordinate them, like a franchising chain of free and open local banks sharing the same values that are open to all people of good will.

You can find such a proposition at www.pavie.ch with all the details on how to function with this local system, as they are already doing in some poor countries.

The dollar will collapse for sure, and you need to persuade everyone to start local systems, improved LETS (Local exchange systems) with dividends and compensated discounts (see social credit on the internet). In fact, the dollar is collapsing faster now; its value is going down all the time. For instance, when I began in the banking business the dollar was nearly four Swiss francs to one dollar. Now, it is one Swiss franc to one dollar. So it is, in fact, a massive inflation. If a Swiss, for example, wants to buy a Chevrolet, he must convert it to cheese, watches, machinery and other goods. If an American wants to buy a Swiss watch, he pays in dollars. And what is a dollar? It is a piece of paper on which is printed, "One dollar: in God we trust" or just some bits in a computer.

YJ: Do you think that the reason they want the US dollar to collapse in the United States is because they want to change it for the Amero?

FS: Yes. What they are doing is the same as they did in 1929. The banks print and open more credits to buy more assets very cheap, that way they control more of the people and you can do nothing without their consent. The Patriot Act is a method of dictatorship and they suddenly wanted to change all the notes and put RFID devices in all the currency.

YJ: What do you think of people who say we should exchange US dollars to Euros or Japanese Yen?

FS: If the dollar is collapsing and the same people are behind the Euro or the Yen, it will all come to the same conclusion. Let’s talk about the Japanese Yen. In Japan there is a big, big problem with the population. One third of the Japanese population will disappear before 2050. It is already beginning. There will be a massive depreciation in the real estate markets and this will create a huge crisis, even bigger than the United States, because the Japanese will not allow immigration. The only solution I can foresee for the Japanese is a massive drop in the price of properties. Already I have information from Japan that they are pushing to establish euthanasia. You know the situation is really a war, a war against the weakest in society. They are buying a lot of robots to cope with this trend. The truth is that they want a massive reduction in the population; by the billions… Julian Simon said in his book "The Ultimate Resource 1" that he was paid by those people to prove that the earth was overpopulated, however he wrote books and articles proving exactly the opposite.

The Ultimate Resource (now The Ultimate Resource 2) and Population Matters discuss trends in the United States and the world with respect to resources, environment, population and the interactions between them. Simon concludes that there is no reason why material life on earth should not continue to improve, and that increasing population contributes to that improvement in the long run. Those popularly-written books developed positive ideas and foresaw the falling natural resource prices, increased world oil supply, and decline in farmland prices. His view of population economics is unique and persuasive. In the discussion, he covers resources, environment, population growth with analytical methods.

As said on Amazon, Julian L. Simon is the world’s greatest contrarian. The Ultimate Resource 2–an update, not a sequel–skewers the sacred cows of environmentalism, population control, and Paul Ehrlich. In the contest between resource scarcity and human ingenuity, Simon bets the farm on the ability of intelligent people to overcome their problems. Thankfully, he is not a theorist. This book lays out convincing empirical evidence for his prediction of a prosperous future. The keys to progress are not state-run conservation programs, he says, but economic and politicial freedom. Only then can talented minds properly apply themselves to their earthly dilemmas.

(To read his book, go to this link: http://www.juliansimon.com/writings/Ultimate_Resource/).

He wrote in his book "Population matters" how he was ostracized by the "rulers" of the new world disorder.

The last book about this type of manipulation is by Steve Mosher. The book is entitled Population Control and it does not simply outline the problems; it proposes a solution as well. Mosher dedicates his final chapter to possible ways that developed nations can avoid the demographic disaster that now threatens. Small tax credits and paltry child subsidies are not nearly enough. Young couples, he argues, need to be sheltered from taxes altogether. And population control programs need to be discontinued as soon as possible. Mosher ends by quoting the late Julian Simon: "Human beings are the ultimate resource." We need everybody to find good solutions.

(For more information see www.pop.org)

The members of those Clubs hate poor people. Most of these wealthy New World Order people are racists, in fact they are racists of the worst kind. They condition people to believe that our earth is overpopulated. And so the poor are corralled like cattle into big cities such as Mexico, just to control them and prove that they are right. But in fact, the rest of the earth is empty. The world is huge and we can feed more people. Ramses of Egypt, in the Bible, had this way of thinking and he killed all the male Jews. Now we have "white" bankers living in New York, London and Paris doing the same well-paid job; killing millions or even billions of aborted children with financial soft Gulags to earn billions of dollars.

I recommend this film: "Freedom to Fascism" from the filmmaker Aaron Russo, who exposed his first-hand knowledge of the elite global agenda during a live video interview with Alex Jones’ nationally syndicated radio show.

Nick Rockefeller told Russo about the plan to microchip the population, (see Bilderberg and micro-chip on the internet) and warned him about "an event that would allow us to invade Afghanistan and Iraq" some eleven months before 9/11. Rockefeller foretold that the "War on Terror" would be a hoax where soldiers would be looking in caves for non-existent enemies. Rockefeller also tried to recruit Aaron Russo into the Council on Foreign Relations during the tenure of their friendship. A picture sent by the Russo family verifies that friendship, and strengthens evidence of a global agenda of which Rockefeller’s creation of women’s lib, and the elite’s ultimate plan for world population reduction and a micro-chipped society, played important roles.
Total America Debt

YJ: Can you explain to us briefly, how money is created today and how it should be created? Then maybe we can speak about the practice of interest.

FS: In the United States most of the money, as credit-bearing interest, is created by the Federal Reserve Board and other private banks. The Federal Reserve is about as Federal as the Federal Express. That means that it is a private company owned by a few people. I have a list of about 12 families who are the shareholders that own the Federal Reserve. These people are using this private business for their own personal gain, to generate private profits of trillions (yes, trillions) of dollars. If you add the amounts that are generated every year since Christmas of 1913, sums hidden in various foundations and trusts in tax haven "paradises," the profits are unbelieveable. Wars are for their own profit only and not for the benefit of the American people.

And on the credit base, which is called M zero, you have a massive creation of money, and this credit is based on nothing. Alan Greenspan said that they create the money out of thin air. You have the statistics published by the Federal Reserve (which is a private company) that show that it is allowing and emitting credit to the other banks or other financial vehicles.

A few months before his assassination, President John F. Kennedy was summoned by his father Joseph to the lobby of the White House. He said to him, "If you do this, they will kill you!" But the President was not deterred. On June 4, 1963, he signed Executive Order number 111 110, that repealed the Act and Executive Order number 10,289, calling the production of banknotes into the hands of the state and depriving the cartel of private banks of a large part of their power. After $4 billion of US dollars in small denominations called "United States Notes" had already been put into circulation, and while the state was preparing to deliver even larger cuts of Fed currency, Kennedy was assassinated on November 22, 1963. This happened 100 years after Lincoln’s death. He had created debt-free "Greenback" notes for the United States as well, and he was murdered by a sniper. Kennedy’s successor Lyndon B. Johnson suspended the printing of the notes for an inexplicable reason. The twelve Federal Reserve banks withdrew the Kennedy banknotes immediately from circulation and exchanged them with their own acknowledgements of debt. A few of those notes are still in the hands of Imelda Marcos because her husband was trying to escape the system.

And now with the sub-prime crisis, they are printing millions or trillions of dollars but we don’t know exactly where this money is going. Perhaps it is going to sustain the banks that are in bankruptcy. Crooks are sustaining crooks. And of course, all of this money is created with an interest rate. This interest rate is imposed on the American population mainly through taxes, on the backs of the poor people. For one example, see the LTCM 3 Trillion dollar scandal under Clinton, and other similar situations. The poor of the world cannot eat; they are starving. And the worse problem is that babies are not even allowed to live! Their goal is to have fewer people that are more easily controlled with laws that are becoming even more and more stupid. One such case is Monsanto, a plant that patents pigs or plants and ruins farmers; their goal is to raise the price of food, all the while saying that they are working for the good of humanity…

The Fed began with approximately 300 people or banks that became owners (stockholders purchasing stock at $100 per share–the stock is not publicly traded) in the Federal Reserve banking system. They make up an international banking cartel of wealth that has no comparison. The Fed collects billions of dollars annually in interest and distributes the profits to its shareholders. Congress illegally gave the Fed the right to print money (through the Treasury) at no interest to the Fed. The Fed then creates money from nothing, and loans it back to us through the banks, and charges interest on our currency. The Fed also buys Government debt with money printed on a printing press and then charges US taxpayers interest. Many Congressmen and Presidents have said that this is fraud.

Louis T. McFadden, Chairman of the House Committee on Banking and Currency from 1920-21, accused the Federal Reserve of deliberately causing the Great Depression. In several speeches made shortly after he lost the chairmanship of the Committee, McFadden claimed that the Federal Reserve was run by Wall Street banks and their affiliated European banking houses.

McFadden said: Mr. Chairman, we have in this country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board and the Federal Reserve Banks. The Federal Reserve Board, which is a Government board, has cheated the Government of the United States out of enough money to pay the national debt. The twelve credit monopolies that were deceitfully and disloyally foisted upon this country by the bankers who came here from Europe and repaid us for our hospitality by undermining our American institutions…

The people have a valid claim against the Federal Reserve Board and the Federal Reserve banks. For the text of his entire speech, see this website: http://www.afn.org/~govern/mcfadden_speech_1932.html

McFadden was killed in the same way as Kennedy and Lincoln and many other opponents to those who control this system of usury.

"Quid prodest scelus, is fecit" which means: "The one who takes profit from the crime, has done it."

An encyclical called "Vix Pervenit" a text stating what contracts are good or bad in business was eliminated from the bookshelves. This encyclical may be found at these addresses on the internet: http://www.papalencyclicals.net/Ben14/b14vixpe.htm and also at http://en.wikipedia.org/wiki/Vix_Pervenit

So who owns the Federal Reserve Central Banks? The true ownership of the 12 Central banks, a very well kept secret, has been partially revealed. This is a list of some names:

  • Rothschild Bank of London
  • Warburg Bank of Hamburg
  • Rothschild Band of Berlin
  • Lehman Brothers of New York
  • Kuhn Loeb Bank of New York
  • Israel Moses Seif Banks of Italy
  • Goldman, Sachs of New York
  • Warburg Bank of Amsterdam
  • Chase Manhattan Bank of New York
  • Lazard Brothers Bank of Paris

These bankers are all connected to London Banking Houses in the totally free City which ultimately controls the Fed. When England lost the Revolutionary War with America (our forefathers were fighting their own government), they planned to control us by taking over our banking system, the printing of our money, and our debt.

The individuals listed below owned banks which in turn owned shares in the Fed. The banks listed below have significant control over the New York Fed District, which controls the other 11 Fed Districts. These banks also are partially foreign owned and control the New York Fed District Bank:

  • First National Bank of New York - James Stillman
  • National City Bank, New York - Mary W. Harnman
  • National Bank of Commerce, New York - A.D. Juillard
  • Hanover National Bank, New York - Jacob Schiff
  • Chase National Bank, New York - Thomas F. Ryan, Paul Warburg, William Rockefeller,
  • Levi P. Morton, M.T. Pyne, George F. Baker, Percy Pyne, Mrs. G.F. St. George, J.W. Sterling,
  • Katherine St. George,  H.P. Davidson
  • J.P. Morgan (Equitable Life/Mutual Life) - Edith Brevour, T. Baker

(source: http://www.rense.com/ufo2/fedrez.htm)
U.S. National Debt, 1930-2006


YJ: Well, I think this interview will help the people understand the system a bit more, and what is happening today.

FS: It is better to fight this way, and create a credit club or a local system with coupons free of interest as we wrote about in the "Michael Journal" with the example of Madagascar and the Philippines, than to take out your gun and fight a war!

YJ: The truth is blinding and people do not see it. They want a complicated system, but in fact the solution is very simple.

FS: During the Great Depression in the 30’s the citizens started 6,000 local systems, local credit systems all over the United States. Tell people to study the history of their country. While they were creating their own credits, the big banks were stopped. Do the same! Improve it with Social Credit systems and dividends to share the profits of the robots and computers! 90% of the workload will be done by computers and robots, the challenge is how is distribute the abundance.

YJ: Well, I think that’s the plan of the Pilgrims of St. Michael, we want to start the local exchange systems all over the world. I know that in Columbia they have several systems that are working very well.

FS: In the United States, your grandfathers were the organizers of the local systems. Ask them how it was done. You had more than 6,000 systems all over the United States. The WIR system in Switzerland has made our country one of the richest in the world. (www.wir.ch) Just think of what happened in Argentina when the banks collapsed there. That can happen in the United States as well.

Maurice Allais, Professor of Economics at the National School of Mining Engineering in Paris, France and the 1988 Nobel Prize Winner in Economics, had this to say in his book "Les Conditions Monetaires d’une Economie de Marche" ("The Monetary Conditions of a Market Economy" p. 2): "In essence, the present creation of money, out of nothing, by the banking system is, I do not hesitate to say it in order to make people clearly realize what is at stake here, similar to the creation of money by counterfeiters so rightly condemned by law. In concrete terms, it leads to the same results."

We need to practice all five Shabbats and Jubilees, every 7 days, weeks, months, years and 49 years ( 7 times 7 years) and fight usury at all levels, because usury kills.

Please read this extract from Louis Even. "But what about the term ‘usury practiced under another form’ used by the Pope? Does it mean too high an interest rate? If so, of what percentage? Or is it something else, and under what form?"

An English priest named Father Drinkwater, wrote a book in 1935 that identified this "devouring usury under another form" that is the monopolization of credit, which was to amount more and more to a monopolization of money, although the workings of this monopolization of credit were still mysterious to almost everyone at that time.

Father Drinkwater recorded that a committee based at the University of Fribourg, Switzerland, had prepared some elements for the drafting of Rerum Novarum, and that among the members of this committee there was at least one person from Austria who was well aware of the money question and of bank credit. A text that this Austrian had prepared and that was apparently approved by the committee, showed clearly how mere bank money–which is created in banks and consists basically of figures written in bank-books and ledgers, and which was already becoming the major monetary instrument for trade and industry–was nothing but the monetization of the production capacity of the whole community. The new money thus created can only be social in nature (belonging to all of society), and not the property of the bank. This new money is social because of its basis: the community, or society, and because it can buy any good or service in the country. The control of this source of money therefore puts in the hands of those who exercise it, a discretionary power over all economic life.

The text of this Austrian expert also showed that banks do not lend their depositors’ money, but rather deposits that they create out of nothing simply by inscribing figures in bank-books. When banks lend money–no account is diminished in the bank–they do not have to extract one penny from their safes. So the interest charged on their loans is certainly usury: whatever its rate–it is actually more than 100%, since it is interest charged on a capital of zero, nil–the lender (the bank) does not have to do without the money he lends, he just creates it! This usury can rightly be described as "devouring", since banks require creditors to pay back money that has never been created, that has never been put into circulation. (Banks create the principal they lend, but not the interest.) It is therefore mathematically impossible to pay back all loans; the only way for the economy in such a system to keep going is to borrow again to pay the interest, which creates un-repayable private and public debts.

What was the exact wording of this text about the monopoly of credit? One cannot know, since there is no mention of it in the encyclical. Was it suppressed in Fribourg in the final draft sent to Rome? Was it stolen between Fribourg and Rome, or between its arrival in Rome and its delivery to the Sovereign Pontiff? Or was it Pope Leo XIII who decided to put it aside? Fr. Drinkwater raises these questions, but gives no answer. End of quote. This scandal is producing the same absurd situation as in Canada.

And finally let us quote Mackenzie King, who stated while he was campaigning to become Prime Minister of Canada in 1935: "Until the control of the issue of currency and credit is restored to government and recognized as its most conspicuous and sacred responsibility, all talk of the sovereignty of Parliament and of democracy is idle and futile." For more graphs depicting our financial situation see our webiste: http://www.michaeljournal.org/images/croisdet2.gif and http://www.michaeljournal.org/images/debtcan.jpg

YJ: We thank you for this interview with us, Mr. De Siebenthal; you are included in our prayers and our support for you and your family.

FS: You are welcome, be assured of our prayers as well, and all the best to you. If you need any further information, please do not hesitate to ask me. You may email me at: siebenthal@gmail.com

By Michaeljournal.org

Source: Frank-Webb.com

Saturday, March 25, 2017

What is Gold Standard?

Gold Standard
Gold standard is a system under which gold is the standard of value. Under the system, the monetary unit of a country is defined in terms of certain weight of gold. Gold standard operated in its original form in several countries before 1914.

Salient Features of Gold Standard

  1. The standard money was defined in terms of a fixed weight of gold and gold coins circulated as full legal tender.
  2. All other firms of money, namely paper money and token coins were freely convertible into gold coins. The results were that the total quantity of money was dependent on the quantity of gold available in the country.
  3. The currency authority was required to buy and sell gold at fixed prices.
  4. There was a free import and export of gold without restrictions of any kind.

Functions

Two important functions of the gold standard were:

  1. To regulate the volume of money in the country (Domestic Gold Standard)
  2. To stabilize the rate of exchange (International Gold Standard).

Rules

The successful working of the gold standard depended on the observance of certain conditions known as the "Rules of the gold standard game". Two important rules are:

  1. Gold should be allowed to move freely from one country to another without any restrictions
  2. There must be an automatic expansion and contraction of currency and credit with the inflow and outflow of gold respectively. Only then, there would be an automatic adjustment of balance of payments between different countries. The success of the gold standard depends on the observance of the above "rules of the gold standard game".

Types of Gold Standard

There were three main forms of Gold Standard. They were:

  • Gold Currency Standard
  • Gold Bullion Standard
  • Gold Exchange Standard


Gold Currency Standard

Gold StandardGold currency standard prevailed in England and other countries before 1914. Under this system, gold coins of definite weight and fineness circulated as standard coins. Gold was not merely a measure of value, but also a medium of exchange. Sometimes, there were other forms of money like paper money and token coins and they were convertible into gold coins. There was a free coinage in gold, gold was freely bought and sold at fixed prices. And there were no restrictions on the movement of gold from one country to another. Gold currency standard was given up by most of the countries during World War I.


Gold Bullion Standard

After the war, many countries introduced gold standard in a different form known as the Gold Bullion Standard. Under this system, gold coins were not put into circulation but paper money circulated in the place of gold coins. That is, the actual currency consisted of paper money and token coins. They could not be converted into gold coins. But paper money and token coins were convertible into gold bullion (bars). Of course, only large amounts of money above certain limit was converted into gold bullion. In fact, gold bullion was sold only for making payments to foreign countries. England was on the Gold Bullion Standard from 1925-31. Some of the important advantages of this form of gold standard were: (1) There was economy in the use of gold and (2) It became a sort of managed standard similar to the inconvertible paper money type, which we have today.


Gold Exchange Standard

Under this Standard, gold coins do not circulate within the country. The local currency of a country consists of paper money and token coins. The local currency will not be converted into gold. But the currency of the country on Gold Exchange Standard will be converted into the currency of some other country which is on Gold Standard. Thus, the currency of the country on Gold Exchange Standard will be indirectly linked to gold. Many poor countries, which did not have enough gold reserves of their own were on Gold Exchange Standard for they enjoyed some of the advantages of the Gold Standard. The additional advantages of this standard were (1) It was economical, (2) There was stability of exchange and (3) The value of the currency could be stabilized in term of gold.


Merits of Gold Standard

  1. If a country is on Gold Standard, its currency will be universally acceptable. It promotes international trade.
  2. The volume of money in circulation in a country will be limited by the supply of gold in that country. Since the supply of money is stable, gold in that country. Since the supply of money is stable, it will create stability in the economy in general and stability of prices in particular. There is little scope for inflation or deflation.
  3. The Gold Standard helps in maintain stable exchange rates among the countries, which are members of the international gold system.
  4. It provides an automatic adjustment of balance of payments.
  5. It is an advantage for gold producing countries.

Demerits of Gold Standard

  1. Gold Standard will work well only when all the "rules of the gold standard game" are followed by the member countries. But the rules are rather rigid. It is not always easy or simple to remain on Gold Standard. The system worked well before World War I because conditions then were favorable. But when it was reintroduced after the World War, it did not work well for conditions differed then. That is why, Prof. Halm says that "It is a fair-weather craft of doubtful sea worthiness in stormy waters." It will collapse at a time of crisis.
  2. It does not establish stability of prices over long periods. For in the long period, even the supply of gold is not steady.
  3. Countries, which are on Gold Standard, sometimes have to sacrifice their domestic stability for stable exchange rates. Gold Standard is a jealous God.
  4. Gold Standard is really not an automatic standard. The Central Bank of a country has to manage the monetary system even when it is on gold standard.
  5. It involves a huge waste of gold reserves. For, under the Gold Standard in its original form, all the money in circulation in the country should be backed by gold.

Causes for the Breakdown of Gold Standard

Britain went off the Gold Standard in 1931. Other countries such as America and France followed suit within a few years. There were many causes for the breakdown of the Gold Standard.

  1. The rules of the Gold Standard were not observed by many countries. For example, the U.S.A. received large amounts of gold by imports. But she "sterilized" those gold resources. Like that, many countries broke the rules of Gold Standard.
  2. France under-valued her currency when she returned to Gold Standard. As a result, she got a large surplus of gold. But she did not follow the rules of the Gold Standard.
  3. World War I affected the working of the Gold Standard. Many countries became debtor countries. War debts and reparations interfered with the smooth working of gold Standard.
  4. The maintenance of Gold Standard became very complicated after the First World War.
  5. The spirit of nationalism was also another factor that contributed to the downfall of the Gold Standard. During the inter-war period (1919-1939), each country aimed at maintaining price stability and full employment and they were not willing to sacrifice domestic interests for the sake of the Gold Standard.
The above things were some of the important factors that contributed to the downfall of the Gold Standard. Some economists feel that "the automatic Gold Standard mechanism will never return." Of course, it does not mean that gold will not play an important role in international monetary affairs. In fact, it has been given a useful role by the International Monetary Fund (I.M.F), an organization for promoting international monetary co-operation.

By HubPages

Source: HubPages

Sunday, March 12, 2017

The golden Dinar and Islamic State

ISIS Coin: 'Islamic State' Steal Gaddafi's Plan to Mint a Gold Dinar

ISIS maniacs are eying plans to mint their own 'ISIS dinar', but these will not be virtual cryptocurrency like Bitcoin or LiteCoin, they want to make a symbolic challenge to 'American infidels' by coining their new money in gold silver and copper.

In a statement issued from the ISIS press office, this move will deliver a blow to “the tyrant's financial system”, and will include seven coins – two gold, three silver and two copper.

The new Islamic State coins will also be, "purely dedicated to God", and according to its creators – designed to liberate Muslims (those who survive the purge anyway) from the "global economic system that is based on satanic usury".

Cryptocoins News explains the monetary and symbolic roots of the Islamic Dinar:
ancient golden Dinar
"The gold dinar is an early Islamic coin that corresponds to and is derived from the denarius auri of the Byzantine era. The gold dinar was in use during a caliphate that was known as the Umayyad. The Umayyad caliphate lasted close to a century. The coin was minted to a carefully controlled standard of 4.25 grams."
Critics point out that ISIS/ISIL would require access to the huge quantities of gold and silver to keep their new mint going. They would also require a secure location for minting and distributing their new money, which does not appear to be the case presently (depending on how desperate the CIA are to roll out the new currency, the New York Federal Reserve Bank might be an option).

Before the NATO blitz which leveled the country, Libya was one of the only remaining nations in the world that still had a 100% state-owned Central Bank, and unlike ISIS, was one of the only nations which actually had the stability, the will, and the means (and the lack of private banking interference inside Libya) to float a currency backed by precious metals.

Before he was murdered by NATO-backed Islamic militants, the late Libyan leader, Muammar al-Gaddafi (1942 – 20th October 2011), tried to enact the very same gold-backed currency project, albeit with much more stable financial backing – overall, a vastly better chance of success.

Many commentators still maintain that it was Gaddafi's pursuit of hard money challenging to US dollar's financial hegemony in the Middle East and Africa – in the form of a Libyan Gold Dinar – that led to the West's decision to attack and destroy Libya in 2011.

ISIS treasury 'administrators' have said they will provide updates and information on their new currency's exchange rate, as well as inform the public where it will be available for exchange.

If only the West had backed Gaddafi – instead of backing ISIS, the world might be a safer place…

By 21st Century Wire

Source: 21st Century Wire


Islamic State accumulating gold, silver and copper to mint its own currency

The Islamic State is not a state and not Islamic, Obama tells us. But it grounds all its actions in explicit statements of the Qur'an and Sunnah, and is busy accumulating all the ordinary features of a state. Does anyone have the will to stop it in its tracks?

An update on this story. "Islamic State reportedly buying silver, gold as it prepares to issue currency," by Mitchell Prothero, McClatchy, November 20, 2014 (thanks to Jerk Chicken):

The Islamic State is not a state and not Islamic, Obama tells us. But it grounds all its actions in explicit statements of the Qur'an and Sunnah, and is busy accumulating all the ordinary features of a state. Does anyone have the will to stop it in its tracks?

golden Dinar Islamic StateAn update on this story. "Islamic State reportedly buying silver, gold as it prepares to issue currency," by Mitchell Prothero, McClatchy, November 20, 2014 (thanks to Jerk Chicken):

IRBIL, Iraq – The Islamic State is accumulating gold, silver and copper in markets throughout northern and western Iraq, dealers report, in an apparent effort to stockpile enough precious metal to follow through on a pledge to mint its own currency.

On Nov. 11, the Islamic State's Beit al Mal, an ancient Islamic term akin to "Department of Treasury," announced that the group would reintroduce the dinar currency of the Umayyad Caliphate, which ruled an empire that stretched from modern Iran to Spain for much of the seventh and eighth centuries. The announcement – which included images of three types of coins in gold, copper and silver – drew skepticism from experts, who doubted that the Islamic State could arrange a system to mint and issue a modern currency.

But interviews with dealers in precious metals indicate that the Islamic State has begun the complex process of issuing the currency, a reminder that as the best-financed non-state actor in history – with a revenue stream from oil sales and aggressive taxation – it's been able to install bureaucratic controls over the large swath of territory it's claimed in Iraq and Syria.

Hajj Samir, a gold trader in the city of Fallujah who asked that his full name not be used for security reasons, said that since the announcement, foreign jihadists had been buying all of the gold and silver in the city's markets.

He said he alone had sold more than 15 pounds of gold to foreigners who were members of the Islamic State. "They said it was for gifts for their wives, but now I know why, and all the traders say the same thing," he said. "We've been making trips to Baghdad to get more, and they buy all of it."

Osman Ahmed, a 37-year-old gold trader in Mosul, said he'd been selling large amounts of gold and silver in the city, even though he now spent most of his time in Irbil, the capital of Iraq's Kurdish region.

"We don't ask why they're buying so much," he said. "But even silver in small shops outside the city is sold out."
golden dinar Islamic State
Golden dinar of the Islamic State
The purchases have reached the point that traders like Ahmed have been traveling between Mosul and the Kurdish cities of Irbil and Suleimaniyah to renew their stocks. The Islamic State buys it all, he said.

Zakaria Ahmed, 33, a Mosul resident who's no relation to Osman Ahmed and whose brother is an Islamic State official, said he'd been told that the currency project was encountering difficulties because U.S.-led coalition airstrikes had made moving valuables more difficult. The airstrikes also have added to worries that any minting facility could be destroyed from the air.

But he said his understanding was that planning for the currency was proceeding apace. "It is still in an ongoing process to be released," he said by phone.

The Islamic State's plans also may be behind a new zeal among the group's fighters to salvage copper on the battlefield. Marwan al Obeidi, speaking by phone from the Iraqi city of al Qaim, said the need for copper for coins had led to the looting of the copper wiring used in electric transmission cables.

The gold and silver purchases are strange enough, he said. "But what is striking is how elements of the organization have seized power transmission cables and other copper components," Obeidi said. The fighters are burning the insulation off the cables and harvesting the copper, he said.

Zakaria Ahmed said it was uncertain that residents of Islamic State-controlled areas would embrace the currency. He said residents who were tired of their sons being killed in fighting and already were facing economic uncertainty didn't see much benefit from the reintroduction of a currency that was last in circulation more than 1,000 years ago.

With doubts high among some people that the Islamic State can outlast the international coalition arrayed against it, Ahmed predicted that "no one will use" the new currency, "even if we assume that it enters the market."

Still, the accumulation of so much gold, silver and copper has a benefit, he said. It provides a valuable asset "for use by the Islamic State."

By Robert Spencer

Source: Jihad Watch


Why Islamic State's gold coins won't replace the global banking system

Advocates of the gold standard have long been dismissed by mainstream economists as a club of bow-tie-wearing crackpots. That is no longer quite fair. Joining the gold bugs' ranks is a group of individuals who almost certainly never wear dickie bows: so-called Islamic State. On August 29th, al-Hayat, the organisation's foreign-media arm, published a 55-minute video denouncing the fractional reserve banking system, and advocating "the return of the ultimate measure of wealth for the world": gold.

golden dinar"The Rise of the Khilafah: Return of the Gold Dinar", makes a bizarre sales pitch for Islamic State's new gold currency. Covering a dizzying range of topics, from the importance of gold as a medium of exchange to "the dark rise of bank notes, born out of the satanic conception of banks", it argues America has been able to avoid hyperinflation and maintain its military hegemony largely thanks to the petrodollar system. Islamic State hopes that with the introduction of what it is calling the dinar, all oil will be paid for with gold instead of being priced in dollars, which would "mark the death of this oppressive banknote" and bring America "to her knees". Charts showing the gradual increase of the American money supply and the devaluation of the dollar are provided as evidence of the dangers of printing money. A rotation of gold-loving financial analysts is featured. Even Ron Paul, a former libertarian presidential candidate, makes an appearance denouncing inflation as theft.

There are three rather obvious problems with Islamic State's plan. First, its yellow currency is no different to any other version of the gold standard. The dinar's worth will be determined by the supply and demand for gold, exposing the currency to fluctuations in the price of the yellow stuff. A fall in the gold supply would be like a tightening of monetary policy; it could cause a recession. Second, a coin backed by a terrorist organisation has obvious credibility problems: aside from the fact that its coins cannot be traded legally, few would presumably use this currency to trade oil if it was only available in coin form, or other forms that relied on trusting Islamic State.

Finally, ending the petrodollar system would first require Islamic State to seize a far larger share of oil production in the Middle East and then persuade countries to agree to trade with it. Even if Islamic State were successful in becoming a major oil exporter, the strength of the dollar depends on far more than its use in the oil trade. American capitalism seems safe for a while yet.

By W.Z.

Source: The Economist

Sunday, March 5, 2017

Lawful Money -or- private credit: Why You should learn how to redeem Lawful Money

If you knew that you have always had a choice to either endorse the private credit of an International Banking cartel, which would then lead you straight into financial hell, or to elect to turn the fiat currency note into Lawful Money by making a demand to have it redeemed for lawful money… which would you choose to do?
FEDERAL RESERVE NOTES
This is an excellent starting point. FEDERAL RESERVE NOTES in their default form is an invitation to endorse private credit and slides one down the slippery slope into financial hell. However, there is always a way to correct a mistake. But, remember, the first time it is a mistake, the second time it is a choice, and the third time its negligence. So choose wisely.
America has a history that is not taught which reveals that a Central Bank has always lead the people into disaster.  Just ask the people of Iceland. Oh, that’s right, they got rid of the bankers, didn’t they?  Now, why haven’t American’s learned the same lesson yet?

I will be honest here and state for and on the record that Americans are not looking to intelligent for not learning by their example.  Therefore, this complaint is not without good cause in relation to what a Central Bank is verses a National Bank.  There IS a difference!  The question is, do you know what that difference is, and if not, then why do you not know?  Lets get on the ball here people! The Federal Reserve Act was passed into law on December 23rd of 1913 at 11:30pm at night.  HELLO!?  Does this fact cause any kind of question to stir-up in your mind?  I certainly hope so.

The interesting thing is that there had to be a remedy left in the Federal Reserve Act.  Why?  Let me put it to you this way.  There will always be people who are intelligent enough and Spiritually in tune to figure out that something is wrong and then seek a solution; but then, there will also be those who will know that something is wrong and do nothing about it for whatever lazy-azz excuse they select to justify their unwillingness to study to show themselves approved.  Approved for what, you say?  How about understanding how to walk on the waters of the commercial world of capitalism commanding and controlling their own vessel, rather than being commanded and controlled by and through the use of a vessel created by another man, which volunteered them into a form of financial slavery.

BITCOIN with LAWFUL MONEY
Replace the word BITCOIN with LAWFUL MONEY, and the conversation is exactly the same. However, the difference with Lawful Money over BITCOIN is that BITCOIN is truly NOT a PUBLIC currency. So then, I caution all to consider carefully all the clauses of the contract of making a use of that private credit. The question is, are you exchanging one man-king and master for another man-king and master? Or, are you going to manage your own estate held in your own Private Trust, and then choose to stay in honor with the statues and codes of the PUBLIC TRUST, which does not infer that you have to be UNDER them, as a Peacemaker and Ambassador for Christ? I know, that is one LOADED question, but it is necessary to be asked.

However, the real question is, can you stay in the Private and then honorably use the PUBLIC TRUST without violating its laws, rules, regulations, statutes and codes to affect a peaceful means and/or solution for providing for your family and estate without violating the Law of the Private Trust you administrate under the Law of your Creator through your Redeemer?  If you see what I am saying, then it is very possible that you have firm grip on how PUBLIC and Private works.

It is a fact supported by OPERATION OF LAW that if you do not demand the currency you make use of to be redeemed in lawful money per 12USC411, then you have indeed elected to endorse the private credit of the private Federal Reserve Bank. Congratulations! You are in bed with Darth Vader, and/or the devil. Wow! Did I just put it that way?! YEP! I most certainly did. Why? Because a remedy and solution is given and if you do not use it then you are in rebellion towards it, and the fact is, it has been provided because all the Sin/Debt has been taken away. The question is, do you see that connection, or do you think that the Creator and Redeemer is imaginary as some are of the foolish tradition of thinking?

For it is written that, "Narrow is the gate and difficult is the way which leads to life, and there are few who find it." Why do you think that faith without works is dead? Why do you think it will only be OVERCOMERS that will sit with Yehoshuah in His Throne upon His return? Why do you think you are here experiencing this world and being tested and challenged by and through what appears to be an evil financial system? Is it really so evil? Or, are there some that have used and abused it thus making it look like it is evil because their intention overwhelms the good purpose of it being used to test one’s faith unto Trust? I know… this is heavy, but far to many of you are not getting this and what it means and I have written plenty on this subject showing the connection between belief, faith and trust being THEE test that is ultimately going on that everyone experiences while in this physical body of flesh.

Everything of the physical is a type of the Spirit. Everything we experience is by design and for a good and grand purpose unto the fulfilling of one’s destiny. It is my hope that you come to know, realize and manifest this.

It would appear that the FEDERAL RESERVE BANK does serve a purpose in testing the heart of men to either elect to live by the Law of God, or to chose another created being to be their King… as in Man-King… as in 1 Sam 8. Read it! We were all given notice by the Creator El Elyon of what the folly of that decision would do to us and yet we still have chosen to ignore His wisdom and go our own way. No wonder Hosea 4:6 is in full force and effect.

choose to elect

When we choose to elect another man to be our King this is the result of that folly. What better example do you need that this? Or, do you think that this example is in error? If so, I do hereby formally challenge you to show how this is not true. Good luck with that.

currency
BUT, there one other difference! One of them can be REDEEMED FOR LAWFUL MONEY PER 12USC411 as clearly stated in Section-16 of the FEDERAL RESERVE ACT thus taking whatever the transaction is out of the FEDERAL ZONE making it a NON-TAXABLE EVENT!

Yes, you have been redeemed without money. This is a fact for those with eyes to see and ears to hear. "For thus says the Lord: "You have sold yourselves for nothing, And you shall be redeemed without money." Indeed, we have all been redeemed by the Blood of the Lamb, and His Blood was and still is PRICELESS.

That is why He took away all the Sin of the world by His Blood. Now then, why do men still toil around in SIN/DEBT unto unbelief in that being taken away? Because of stubbornness! Because of unwillingness to finally come to the end of one’s own way, which is against the Will of God. Until one surrenders their own Will and Way for THE WAY and His Will that one is essentially "LOST AT SEA." And that brings the connection directly into why there is a national debt, because people are still believing in Sin and that Sin has more power than the Redeemer’s Blood. Do you see how the physical is a reflections of the Spiritual state of mankind? It gauges it perfectly!

So then, only those that do believe, agree and place Trust in His Blood for doing exactly what He claims it has done. Indeed, these are Redeem without MONEY.

But, for those that have no such faith unto Trust… what are you going to do for your own salvation, not to mention your own Estate and Title whilst you are still here in this physical body of flesh? How are you going to even bring balance to the physical books if you are not balance Spiritually by submitting to the Law of the Trust of God in obedience so that not only can you see the provision that has been provided, but also claim it and use it according to the Will of God? Yes, for those of you who disparage those who do have faith, how will you redeem yourself without the Redeemers blood? There can only be one way, and you better make sure that your blood IS as pure as His blood. Else, you are sunk by your own arrogance, ignorance and egotism.

The entire world has been held hostage by the FEDERAL RESERVE SYSTEM through its international agent called the INTERNATIONAL MONETARY FUND (IMF). The world was forced to use only the Federal Reserve Note to buy and sell oil. This is why the Federal Reserve Note is also called the PETRODOLLAR. This has all been effectively done at gun point.
fiat currency
You can still have virtually the same affect by redeeming the fiat currency into Lawful Money. This is an election. You either endorse private credit by not demanding lawful money, or you demand lawful money and redeemed yourself from the FEDERAL ZONE and out the taxable jurisdiction under the power and control of Caesar.

If GOLD is the currency of Kings, and SILVER is the currency of Gentlemen, and BARTER is the currency of peasants, THEN debt is currency of SLAVES! So then, MANY people have indeed chosen by their actions to be a SLAVES rather than a King and/or Gentlemen, because they are unwilling to OVERCOME this world and learn what they need to apply so that the physical world no longer holds power over them. And, like it or not, or, agree with this or not, all things happening in this physical world has a direct connection to spiritual matters. So then, learn how to STOP ENDORSING PRIVATE CREDIT and DEMAND LAWFUL MONEY! And, by doing so, you will also be declaring that you indeed are REDEEMED WITHOUT MONEY, but by blood, so that your faith is now with works that back up your claim to having faith.
currency of Kings

Yehoshuah
"But why do you call Me ‘Lord, Lord,’ and not do the things which I say?" Yehoshuah walked on the waters of the commercial world of His day and by doing that He set an example for ALL people to follow, no exceptions. He commanded and controlled His PUBLIC life by and through the power of His Private Life and Relationship (Trust) with His Father. He kept, which is to fulfill, the Law of the Trust that He was bound in agreement too, else Men would have no reason to have faith much less a valid place to Entrust.

So then, can you follow His example? Yes, you can! Albeit, not like He accomplished it, but, it is most certainly possible as with God ALL things are possible. Remember, a big part of the experience of this Life unto OVERCOMING this world is to ENDURE TO THE END!  "And you will be hated by all for My name’s sake. But he who endures to the end will be saved."

But, the question is, are you willing to do what is necessary to do the same thing and thus OVERCOME this second age? "Many are called but few are chosen." This does not mean that the many are going to go to hell, and that the few are not. On the contrary! The many will be given their opportunity to choose God’s way, or their own way, during the millennial rule of Yehoshuah at the beginning of the Third Age. (SIDEBAR: Understanding the Ages is one major KEY to understanding The Holy Bible and putting things into context and order. If you are unaware of this knowledge, then I encourage you to seek this knowledge out ASAP!)

It is a warped religious organization that does not teach the truth about the Ages. What is really ugly is the vast majority of RELIGIOUS ORGANIZATIONS (501c3’s) are exactly that… warped, because they do not teach the doctrines of the Law of God, but rather the traditions of men.

If you do not chose to learn what you need to learn so that you can fulfill, "Come out of her, my people, lest you share in her sins, and lest you receive of her plagues," then all that you have been doing is making a use of a fiat-fictional currency, which involves you in directly DEBT and the expansion of the national debt.

Now, replace the word DEBT with the word SIN. STOP being involved in Babylon/Rome’s debt, which is the same as sin. Any claim of a debt against you is a claim that you are a sinner, and God does not hear sinners, John 9:31, "Now we know that God does not hear sinners; but if anyone is a worshiper of God and does His will, He hears him."

So then, the connection of Spiritual to Physical is this… if you do not redeem the currency then how can you claim to be redeemed by the blood of Christ? You will be swimming in SIN, which is DEBT, if you do not redeem the currency, or claim to be Redeemed by His Blood. Do you see the connection? There is a connection whether you agree with this or not. This world and this AGE was designed to test this very thing! Everything of this physical world is a type of the Spiritual!

In addition, the weapons of our warfare are spiritual and are therefore unseen. The fact is the affects of the world of fiat currency (usury, interest, unbalanced scales, unequal weights and measures) is unseen, but it is felt, and its affects are made known as they do manifest. Ergo the NATIONAL DEBT! The purpose is all about testing your faith in light of the Biblical Maxim, "No man can serve two masters." If you choose not to redeem the currency into Lawful Money, then how are you doing the things that Jesus said one is to be doing? "But why do you call Me ‘Lord, Lord,’ and not do the things which I say? DO NOT DO THE THINGS WHICH I SAY! To be involved in and with the National Debt IS TO BE involved in SIN. How can one so involved be doing the things which He commanded?!

There is salvation by simple belief unto faith, and this is for those of the outer court of the Temple, but then there is also the elect who will rule with Yehoshuah in His Throne. "To him who overcomes I will grant to sit with Me on My throne, as I also overcame and sat down with My Father on His throne." (Rev 3:21) Which one do you intend to be, and why would He put someone in His throne that does not understand how God’s system of Commerce works righteously and fairly for ALL, no exceptions?

Notice I said commerce, NOT capitalism! The difference is in God’s system of Commerce every one wins! But, in capitalism, which warps Godly Commerce into profitable enterprises for the selfish and greedy, there are winners and losers. This goes directly against the Law of God and His Will for ALL things to be EQUAL and BALANCED. (See DEUT 25:13-16 and Proverbs 11:1) Do you see the difference? Do you understand the importance of this delineation. I can only hope and pray that you do, for without such knowledge, understanding and wisdom salvation could hang in the balance.

one dollar
So then, what are you going to do with this knowledge now that you have read all the way to this point? You do realize that by being informed of this choice that you have automatically incurred a duty and obligation unto doing the wise thing according your understanding and knowledge of these things. Be mindful that you are now with knowledge that many will flat-out reject without evidence to the contrary. Take care to not be one of these and as always, use this knowledge in concert with, "Be wise as a serpent and as harmless as a dove." For, "When a man’s ways please the Lord, He makes even his enemies to be at peace with him." So then, resolve to BE the PEACEMAKER and be recognized to be an Ambassador for Christ.

In another post, a poster attempted to explain that they used THEIR MONEY to set off a debt. Without more detail to explain exactly what they did as well as to vet and validate their claim, I proceeded to point out with the question, "How does one pay a debt with a debt note?" For FEDERAL RESERVE NOTES being a fiat currency is a note of debt in their default form. UNLESS one avoids that pitfall and elects instead to make use of Lawful Money. This can only be done with a demand that the currency be redeemed, else it is not redeemed and is a debt not by default.

In short, Isaiah 52:3 says, "For thus says the Lord: "You have sold yourselves for nothing, And you shall be redeemed without money." This is in conjunction with 1 Samuel 8:10-20. For a Living Soul to be redeemed that can only happen by blood. Specifically, the blood of the Lamb of God. But, while the children of God are in this physical form how shall that redemption be carried out so that one is not involved with Sin, which is Debt, and effectively complies with Revelation 18:4-5 to, ""Come out of her, my people, lest you share in her sins/[debts], and lest you receive of her plagues. For her sins/[debts] have reached to heaven, and God has remembered her iniquities." This can only take place by the determination of one who understands that the manifestation of the Kingdom of God that is within them can indeed take place NOW for those who have placed their Trust in the One who is with their Eternal Life. "Now when He was asked by the Pharisees when the kingdom of God would come, He answered them and said, "The kingdom of God does not come with observation; 21 nor will they say, ‘See here!’ or ‘See there!’ For indeed, the kingdom of God is within you." (Luke 17:20-21)

Everything that one experiences in this physical world has spiritual ramifications. This is why, "For the weapons of our warfare are not carnal but mighty in God for pulling down strongholds, casting down arguments and every high thing that exalts itself against the knowledge of God, bringing every thought into captivity to the obedience of Christ, and being ready to punish all disobedience when your obedience is fulfilled." (2 Cor 10:4-6). What is learned of the Spirit is demonstrated by and through the physical. So then, if one refuses to redeem for lawful money and thus exit the Federal Reserve Zone of Sin and Debt, then how shall they claim that they are redeemed by the Blood of the Lamb of God? Is it not written that faith without works is dead. So then, if you claim to have faith, then just don’t say that you have it, show it by your works. Else do not speak of the matter until you do.

What I am saying is that if lawful money is not demanded to redeemed the claim of there being a debt then the books have not been balanced to zero and the debt still does exist. For a debt not cannot and never will pay a debt IN Law! This a fact of basic algebraic mathematics. A negative plus a negative does not and never will equal a positive. [ -2 + -2 <> 4 | -2 + -2 = -4 ] And what one has actually done has expanded the debt and is directly involved in increasing the national debt. This is the end result of a little bit of ignorance and a lot of presumption with do. Therefore, the debt/sin was not settled, extinguished and closed.

For Caesar has no willingness to oblige anyone who does not have enough knowledge know these things, nor is willing to learn them of their own initiative. The key comes with understanding how one is endorsing the private credit of the private FEDERAL RESERVE BANK because IF one does not declare their intent to STAY OUT OF THEIR FEDERAL ZONE, then by the design of that fiat currency note, one has volunteer into that zone and is under the jurisdiction thereof wherein no man can serve two masters. And, since Caesar’s world is a world that operates on the Rule of Bankruptcy, Debt, and Usury, then this reflects that one has determined for another man to be their king just as Israel did in 1 SAM 8.

Lawful Money Trust IS Coming!

http://www.lawfulmoneytrust.com
https://www.facebook.com/lawfulmoneytrust

Stay Tuned! However, in the meantime… enjoy these.

Bank Fraud in Ten Minutes
https://www.youtube.com/watch?v=bKrcSXyT25Y
… and, as well as,

The dollar and the real inflation story
http://www.resourceinvestor.com/2013/03/25/the-dollar-and-the-real-inflation-story

But, above all...
"Seek ye first the Kingdom of God and His Righteousness," and in that seeking,…
Get Knowledge,
Get Understanding, and
Get Wisdom!

By BORN IN EQUITY

Source: BORN IN EQUITY