Category Archives: The Political Money System

Mid-October Newsletter – 2013

Posted on October 21, 2013 | 2 comments

In this issue

   November travel to Turkey and beyond

   Summer tour report, Part 2. Sweden and England

   Bangla-Pesa Charges Dropped

   The Geo-political Struggle

On the move again

I’ve been invited to give a presentation at the 4th Green Economy Conference, Green Economy and Commons, 16-17 November 2013, in Istanbul, Turkey. As a panel member on the 16th, my topic will be, Reclaiming the Credit Commons: the Key to a Green Economy and Global Harmony.

Now, as we approach the end of a very busy and demanding year, I’m feeling the need for rest and renewal, so my intention is to travel onward from Turkey to southeast Asia where I will take a lengthy sabbatical. I will try to remain in touch, but don’t be surprised if email messages are not answered promptly. If your communication is really important, mark it “urgent” and keep trying, or Skype me.

European tour report — Part 2, Sweden and England

Following the Hague conference, I travelled to Sweden for a two week stay (June 24 to July 8) during which time I gave presentations and met with community currency activists in Gothenborg, Lindsberg, Gotland, and Stockholm.

My Gothenborg presentation, titled The Economics of Peace, Justice and Sustainability: Toward a New Convivial World Order, was held in a lovely old church that has been converted into a community center and café that provides, among other things, services to the city’s homeless population. One of my Swedish hosts and main tour organizer, Marianne Påsse, sent out a report on that event. Here is an slightly adapted version of it:

We had a wonderful evening yesterday! We were around 50 people, including us. I was content with that (I had no idea of how many might come)! The evening started with a mini-concert; a leading violinist (Helga Hussel) accompanied by Barbro Fridén on accordion, playing Pearls of World Music. It was lovely listening to them in that very nice building, good acoustics!

After that I spoke a little…making a bridge between Charles Eisenstein’s recent presentation (Approx. 25% of the audience were listening to him in the same building some weeks ago) and Thomas. I also asked the audience to raise their hands if they needed translation of some expressions (happened just 2 or three times…once at the very first picture).

Thomas presented a power point show with very well selected pictures. He spoke about them and…it is good to be able to read at the same time (Microphone is necessary). He spoke for approximately one hour, and people were very interested and kept him busy for another ½ hour, until I closed the session (it was late). The questions were very accurate and in depth. People came up to me afterwards and thanked for a very interesting evening. Afterwards Yoshi and Jackie had an evening meal and chat at our place. And today we pack for Lindsberg! So, we are very pleased!

At a summer gathering at an intentional community in Lindsberg I lead two workshops on successive days, each one beginning with a slide presentation. These were titled, Building Resilient Communities: A New Paradigm for Community Development, and The Global Financial Meltdown: Its Causes, and Opportunities for Localized Restructuring. The participants in each of these sessions were few in number but enthusiastic.

As it happened, I was in Sweden at the right time to participate in the Almedalen Week on the island of Gotland. This has become an annual event that brings together a wide variety of business people, politicians, academics, grassroots activists and ordinary folks. You can learn more about this remarkable event at http://www.almedalsveckan.info/.

I had no official role in the Almedalen proceedings, but was able to attend a few of the 2,000+ organized sessions and got to shake hands and chat a bit with the U.S. Ambassador to Sweden, Mark Brzezinski (son of Zbigniew Brzezinski who was National Security Adviser to President Jimmy Carter).

I finished up my Sweden tour in Stockholm, where I was hosted by an American friend who has been living there for several years with his Swedish wife and young son. In Stockholm I got to meet some of the main figures in the JAK Bank, a unique financial institution that since 1970 has been providing interest-free loans. They together with a few other groups organized an event for me which attracted a sizeable crowd, where I repeated the presentation I gave in Gothenborg.

My photos from Sweden can be found at Sweden 1, and Sweden 2.

England (July 8 – July 20)

I may at times complain about it, but I love Britain, and this time I had the opportunity to be in the Lake District at a time when the weather was simply superb (“the first real summer we’ve had in seven years,” the locals told me).

The focal point of my visit was a full day workshop (July 12), Unlocking Local Wealth, held at Cumbria University in Lancaster, an event organized by the Institute for Leadership and Sustainability (IFLAS) of the University of Cumbria Business School, in association with the New Economics Foundation, the United Nations Non-Governmental Liaison Service, and Impact International. The event was billed as “a one day workshop with world experts on alternative currencies and exchange systems.”

That workshop was preceded the day before by a gathering in which most of the same “world experts” came together to “clarify an action research agenda, explore ideas for collaboration, begin grant mapping,” and provide “feedback on one key new initiative (Eurocat).” Then, that evening, there was a public event titled, Starting Your Own Currency: Why and How? sponsored by (IFLAS ) in association with Lancaster’s Ethical Small Traders Association. This event featured a keynote presentation by John Rogers followed by my response and a general discussion.

Here are the links to videos that were recorded during that event:

Jem Bendell introduces the keynote

Keynote by John Rogers, co-author of People Money

Keynote response by  Tom Greco, author of The End of Money and the Future of Civilization

Along with a few other colleagues, I had the pleasure of enjoying a few more days of discussions and Jem’s hospitality at his home overlooking Lake Windermere.

My England photos are here:

I’ll report the final portion of my tour (Greece (July 20 – August 21)) in the next edition of my newsletter

Bangla-Pesa Charges Dropped

I reported earlier that one our close associates, Will Ruddick, along with several of the local currency activist there in Kenya had been arrested and their Bangla-Pesa currency project shut down. I’m happy to report that finally, the charges against them have been dropped. You can read about it here. (A very interesting earlier account that describes their ordeal can be found here.

This is great news, not only because the threat of punishment has been removed, but because this important development project may again have a chance to improve the lot of poor micro-entrepreneurs in Kenya and to demonstrate the power of the local credit clearing model in alleviating poverty. The Bangla-Pesa project is the most significant complementary currency project that I am aware of and has the potential to become THE model for other communities to follow. It deserves strongest support.

[Update. This just in from Will: We won! The official court order to release us was just released last week and can be seen here: http://koru.or.ke/Bangla-Pesa-Dream-Nov Not only have we been acquitted but we’ve been given a relaunch date of November 23rd to restart the program

Will adds, We’ve also created this 3 minute cartoon to explain how these programs form an effective barrier against poverty and market stagnation: http://www.youtube.com/watch?v=UaspBGmsdLE Please share widely.

The community is really excited and ready to move forward.]

The Geo-political Struggle

Alvin Toffler observed more than 30 years ago that the power of nation states was in decline and predicted that the trend would continue. It is clear that national governments are ceding sovereignty, not to global democratic institutions, but to transnational corporate entities resulting in a New (fascist) World Order that bypass all the checks on power that have been built into democratic governments over the past three centuries. George Monbiot’s recent article, Elite Insurgency, articulates some current features of that shift.

And Karen Hudes has revealed that World Bank corruption is an inherent element in the global Elite takeover. After Twenty one years at the World Bank, she has blown the lid off the cover-up of the corrupt global financial regime. Watch this interview with Karen: http://youtu.be/M4VGoXV5vYg . A longer interview in four part can be seen here.

These are a few pertinent quotes from her interviews:

“This is a massive cover-up; this makes Watergate look like tidally-winks.”

“Big boys who think they own the world.”

“We don’t have a democracy here.”

 “The Federal Reserve has “gamed” the capital markets.”

“This whole country is so corrupt, you can’t begin to imagine. I can’t tell this to the people because the press is owned by those thugs”

“Stakeholder analysis” identifies a “super entity” of ownership and control.

All of that is very troubling, but we have a choice—to  build our own (democratic) new world order from the bottom up, community-by-community. PowerShiftWe cannot be complacent; we must reduce our dependence upon corporate controlled mega-systems, especially banks, and secure the availability of the necessities of life within our local regions.

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Posted in Developing Alternatives, Geo-politics, My activities, Prescriptions, The Political Money System

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Hungary pays off IMF, tells them to leave.

Posted on August 19, 2013 | 2 comments

Hungary is about to pay off its debt to the IMF and has ordered their employees to leave the country “as soon as possible.” The Hungarian Minister of Economics says his government is confident that it is well positioned to pursue an independent economic policy.

Is this the start of a revolt of sovereign nations against the global bankers? Will others follow Hungary’s lead? What sort of backlash might be expected?  Will the bankers try to influence next year’s elections, or failing that, will more drastic actions be taken to oust the present Hungarian government? As a member of the EU, Hungary will be no push-over like Libya.

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Posted in Geo-politics, The Political Money System

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FED: “your gold is safe with us, just don’t ask for it back.”

Posted on August 16, 2013 | 6 comments

The global banking farce is becoming ever more hilarious (if you can ignore the tragic consequences of this monumental fraud). Germany is seeking to repatriate its gold that is supposedly held by the US Federal Reserve, but the Fed says, “Nein, you cannot even examine it.”

 Watch this RT report to get the story:

6 Comments

Posted in Banking, Geo-politics, The Political Money System

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New video describes “A flaw in the monetary system”

Posted on August 10, 2013 | 2 comments

This is an excellent video–clear, concise and accurate. If you want to understand why we have recurrent financial crises, dire want amidst plenty, and why debts keep growing faster than ability to pay them, this is a great place to start.–t.h.g.

“The new film ‘A Flaw in the Monetary System?’ depicts in 7 ½ minutes consequences of interest and compound interest in the financial world in descriptive graphics. It illustrates the systematic redistribution of money from the majority to the wealthy.”

See it here: https://vimeo.com/71074210

 

2 Comments

Posted in Basic Concepts, Finance and Economics, The Debt Imperative, The Political Money System

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Welcome to Goldman Sachs

Posted on August 7, 2013 | 1 comment

I’m a subscriber to Quora.com and receive a weekly digest by email listing things that I’ve expressed an interest in. One item this week consisted of answers to the question: “What are some of the most profound jokes ever?” I found this one below to be especially profound and timely.

Anonymous

5725 votes by Matthew Baldwin, Massimiliano Marangon, Vallabh Anwikar

A manager at Goldman Sachs has this to tell.

Once upon a time in a village, a man announced to the villagers that he would buy monkeys for Rs 10. The villagers, seeing that there were many monkeys around, went out to the forest and started catching them.

The man bought thousands at Rs 10 and as supply started to diminish, the villagers stopped their effort.

He further announced that he would now buy at Rs 20. This renewed the efforts of the villagers and they started catching monkeys again.

Soon the supply diminished even further and people started going back to their farms. The offer rate increased to Rs 25 and the supply of monkeys became so little that it was an effort to even see a monkey, let alone catch it!

The man now announced that he would buy monkeys at Rs 50!

However, since he had to go to the city on some business, his assistant would now buy on behalf of him.

In the absence of the man, the assistant told the villagers, “Look at all these monkeys in the big cage that the man has collected. I will sell them to you at Rs 35 and when the man returns from the city, you can sell it to him for Rs 50.”

The villagers squeezed up with all their savings and bought all the monkeys.

Then they never saw the man nor his assistant, only monkeys everywhere!

Welcome to ‘Goldman Sachs’!

Hmm, sound familiar?

More profound jokes here.

 

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Posted in Banking, Finance and Economics, Humor, The Political Money System

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Do Banks Create Money out of Nothing?

Posted on April 22, 2013 | 19 comments

One of my correspondents recently referred me to an article and asked for my opinion about it. The article is Creating Money out of Nothing: The History of an Idea, by Mike King, dated April 2012 .

I read the abstract, the conclusions, and part of the body text, but could not bring myself to make a detailed read. “The history of an idea” is not relevant to my interests nor to the debt crisis that plagues civilization. Verbose and tedious, it seems to be an academic exercise that I doubt  will be of interest even to historians.

On the positive side, it did prompt me to write a few words of clarification on the question, words that I think are both pertinent and helpful to those who truly wish to understand the nature of money and the role of banks in today’s world.

The accusation that banks create money out of nothing has, according to King, been made by many famous economists, including Schumpeter, von Mises, and Keynes. I too must admit to having once or twice used that statement as a sort of shorthand criticism of the global money and banking system.

It is surely true that saying that banks make “money out of nothing” is an exaggeration that can be misleading to the uninitiated.

Bank actually create money out of something. The question is, what is that something, and what is wrong with it?

The short answer is that banks create money on the basis of the promises of their borrowers to repay.

Mr. King would have us believe that banks simply take in money from savers and lend it out to borrowers. That is clearly wrong. Even the Federal Reserve, in its own publications, says that,

The actual process of money creation takes place primarily in banks.(1) As noted earlier, checkable liabilities of banks are money. These liabilities are customers’ accounts. They increase when customers deposit currency and checks and when the proceeds of loans made by the banks are credited to borrowers’ accounts.

In the absence of legal reserve requirements, banks can build up deposits by increasing loans and investments so long as they keep enough currency on hand to redeem whatever amounts the holders of deposits want to convert into currency. This unique attribute of the banking business was discovered many centuries ago.–Modern Money Mechanics

As I’ve pointed out in all of my books, banks serve two primary functions. They act as both depositories, reallocating funds from savers to borrowers, and banks of issue that monetize the promises of their borrowers. I’ve explained that in detail in Chapter 1 of my book, Money: Understanding and Creating Alternatives to Legal Tender, and in Chapter 9 of my latest book, The End of Money and the Future of Civilization.

But not all promises provide a proper basis for creating money. As Edward Popp, describes it, banks create both bona-fide and non-bona-fide money. (See Money, Bona Fide or Non-Bona Fide at http://www.reinventingmoney.com/documents/bonafidePopp.pdf).

The vast majority of the non-bona-fide money that banks create, is created on the basis of loans made to national governments (when banks buy government bonds). Further large amounts of non-bona-fide money are created when banks make loans to finance purchases of consumer goods and real estate (see my books for details). This is a violation of the principle that money should be created on the basis of goods and services on the market or soon to arrive there, which includes promises of established producers who are ready, willing and able to sell for money the things they ordinarily offer.

The bottom line remains: the present global, interest-based, debt-money system, is dysfunctional and destructive.

The creation of money on the basis of interest-bearing loans is the cause of the growth imperative, and the creation of non-bona-fide money is the cause of inflation.

If we are to achieve a sustainable society and assure the survival of civilization, we must transcend the present money and banking paradigm and reinvent the exchange process.  – t.h.g.

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19 Comments

Posted in Banking, Basic Concepts, Finance and Economics, Inflation, The Debt Imperative, The Political Money System

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Can governments and banks be trusted with the money power?

Posted on March 23, 2013 | 1 comment

As governments around the world struggle to manage their soaring debt burdens, the wisdom of E. C. Riegel rings ever more true. The masters of the political debt-money regime are pressuring Cyprus to confiscate part of the savings of their citizens, and Greece and other countries to impose budgetary cuts that burden the poor and middle class. Argentina wants to grab their people’s savings by nationalizing their pension funds. All the while, the purchasing power of national currencies shrinks as governments inflate them to enable deficit spending.

Riegel’s call for monetary freedom must no longer be ignored. –t.h.g.   

LET FREEDOM RING THE CASH REGISTER

[by E. C. Riegel, written circa 1940s]

Old Liberty Bell rang out the political freedom that we cherish. But unless we learn how to make freedom ring the cash register, bureaucracy will ring down the curtain on our liberties.

What is the strange power that makes the government at Washington grow stronger and our state and local governments grow weaker while the people suffer the torment of war and the travail of insecurity and the shadow of dictatorship falls across the land? It is the same power that oppresses the people of all the world — the political money power.

The political money power is the power of national governments to buy the people’s sweat and blood with scraps of paper – paper that falls like a blotter upon our production and our freedom. Each day our

wealth diminishes and more of our liberties vanish. Inflation that threatens to bring chaos is just around the corner. As our sons bleed and our mothers weep, the same grinding power throws its pall over other lands.  Yet our chains are paper – paper money that, through our ignorance, binds us to the treadmill of our own destruction.

We can be masters of our destiny; we are all powerful, if we but realize it. In each of us resides the power to assure liberty, prosperity, security and peace. In each of us lies the money power, which, when springing from us, is democratic and virtuous; when springing from government is authoritarian and vicious. As we liberate our inherent money power we curb the political money power, for the more we use our self-created money, the less we need political money. Thus we defeat dictatorship. Thus we reconstruct the shattered world on a free democratic basis. Thus we save civilization.

Parchment freedoms are but taunts and mockeries without money freedom. A people dependent upon their government for money is a subject people regardless of the form of their government. No people can declare their independence and govern their government unless they assert their money freedom. A government that is not dependent upon its people for money supply is a tyranny regardless of its professions. Government must be made to beg the people for money; the people cannot be sovereign while petitioning government for money. The citizen must command both government and business through his money power. Political democracy is a delusion without economic democracy and economic democracy can function only through the power to issue money – the power to ring the cash register – the power to support and the power to withhold support. To prevent political dictatorship the citizen must himself be a dictator. To prevent centralization of power, power must be reserved by the people. Money power is sovereignty; without it democracy is impossible.

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From Money Freedom, organ of The Private Enterprise Money Movement.

More monetary wisdom from E. C. Riegel, including his book, Private Enterprise Money, can be found at http://www.newapproachtofreedom.info/, and via my website https://beyondmoney.net/.

— Thomas H. Greco, Jr.

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Posted in The Political Money System, The state of democracy

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You are the target

Posted on March 15, 2013 | 4 comments

The graphics below capture the essential nature of western civilization today–everything is for sale, the main source of revenue for businesses and governments is advertising, everyone is trying to colonize your mind.

Corporations say, “buy, buy, buy.”
Religious organizations say, “believe, believe, believe.”
Governments say, “obey, obey, obey.”

— t.h.g.

AdBuster$5Bill

ForeheadAd1

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Posted in Geo-politics, The Political Money System, The state of democracy

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Too big to fail equals too big to take to trial, or punish, or effectively control…

Posted on February 20, 2013 | 1 comment

Senator Elizabeth Warren asks the embarrassing questions.

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Posted in Banking, Government, The Political Money System

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Davos-What’s missing from the conversation?

Posted on February 1, 2013 | 1 comment

Professor Jem Bendel is Director of the Institute for Leadership and Sustainability at Cumbria University in the UK, and a “young global leader” of the World Economic Forum. In this short video interview, he expresses his views on what is, and is not, happening at the Davos forum to address the global crisis.

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Posted in Banking, Finance and Economics, The Political Money System

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