As scary as it is for some to admit even at this stage of the game, the current financial system sits precariously on the edge of a meltdown beyond anything ever recorded in human history. Normally, such a systemic meltdown would generate such turbulence and panic that the masses of complacent subjects would be induced to action in defense of their families and nations, however under current circumstances, the coronavirus pandemic has ensured that no such mass movement, or policy fight has taken shape.
The deadly fault of the current system is insistence on keeping intact the very power structure that has caused our current reality. The results of any system are largely determined by its most fundamental aims. If the aims are further concentration of both economic and political power in a tiny oligarchical minority, then the results will approximate those aims. No solutions are possible from the within the system. We must first, in one way or another, take away their power to set systemic goals, followed by redefining the systemic aims to serve We The People. In order to achieve this we must undergo an alchemic transformation from We The Sheeple to We The people. Apparently this is an act proving to be as difficult as turning lead into gold. ;-)
A Nation’s Monetary System could be, and should be, this simple…..
A Nation’s money is owned by the citizens of the Nation.
The value of a Nation’s money is determined by the productivity (labor) of the Nation’s citizenry as expressed in the quantity and quality of the goods and services produced by the Nation’s citizenry.
A Nation’s Treasury Department adds money to a Nation’s economy through a National Bank.
A Nation’s Treasury Department subtracts money from a Nation’s economy through tax collection, i.e. Internal Revenue Service.
A National Bank manages the Nation’s money supply.
Loans increase a Nation’s money supply.
Loan repayment and taxes decrease a Nation’s money supply.
Loan interest rates control how quickly a Nation’s money supply will increase.
Tax rates control how quickly a Nation’s money supply will decrease.
A National Bank is owned by a Nation’s citizens and therefore the interest received from loans will never be siphoned off as profits to any private owner.
Only independent sovereign nations can establish a National Bank to manage the Nation’s money.
The National Bank is subordinate to the Nation’s Treasury Department.
The National Bank does not sell ownership rights to the Bank to citizens using stocks or bonds.
The National Bank is forbidden from buying and owning and trading assets, including stocks, bonds, and mortgages, both domestic and foreign.
Only the National Bank is authorized to create money by making loans to citizens and businesses, to Federal Government Agencies, and to State and Local Government Agencies.
National Bank Branches will be located in each Postal District throughout the nation.
National Bank Branches will manage loans:
Issuing, setting interest rates, evaluating applicant’s loan needs and applicant’s capability to repay their loan’s interest and principal.
Loan Types:
Monthly Revolving Credit Card:
The higher the monthly credit card limit, the higher the interest rate.
Transportation Vehicle Loan:
The more expensive the vehicle, the higher the interest rate.
Home Mortgage Loan:
The more expensive the home, the higher the interest rate.
Personal Loan:
The higher the loan amount, the higher the interest rate.
Business Loan for Business Expenses:
The higher the loan amount, the higher the interest rate.
New Business Start-Up Loan:
The higher the loan amount, the higher the interest rate. A maximum loan amount will be determined based upon risk of success or failure of the New Business. New Businesses can seek loans from non-Bank investment lenders.
Federal Government Agencies:
The National Bank will issue loans to Federal Government Agencies that will be repaid from Federal property and sales taxes, and tariffs.
State and Local Governments Agencies:
The National Bank will issue loans to State and Local Government Agencies that will be repaid from State and Local property and sales taxes.
Loans and taxes can only be paid in Bank money.
There shall be no Federal, State, and Local income taxes (personal and business). There shall only be Federal, State, and Local property and sales taxes.
Only the Federal Government can levy tariffs.
Loan interest rates and tax rates are modified to control the money supply, and thereby inflation.
Government agencies contract goods and services from citizens and businesses and other government agencies.
Federal, State and Local Government agencies submit budget requests to their governing elected representatives. Budget requests will either be approved, denied, or modified by the governing elected representatives. Approved budget requests are recorded in a national database that National Bank managers can search to confirm loan applications from Federal, State and Local Government agencies.
Welfare is a no-interest non-repayable loan (gift) to citizens based upon their poverty.
Welfare recipients have to agree to a contract with the National Bank requiring the welfare recipient to change their detrimental and self-destructive lifestyle behaviors and habits, fulfill training goals, and fulfill minimum employment requirements.
“Outsourcing of vital manufacturing, decay of infrastructure maintenance and improvement, privatization of public goods, and loss of machine tool powers simply resulted in the transfer of wealth into the hands of a small elite, and the stripping of nation states from the economic sovereignty they once enjoyed.”
Matt, you have referenced the privatization of public goods in several articles and that notion seems counterintuitive to me. Can you give a couple of examples of that and how it transferred wealth? Every time I read it, it sounds like you’re advocating for socialism of some sort, but I can’t figure it out. Thanks!!!
Our economy is not an economy. A real economy is much like a farm. The output can never exceed the input. This is certain for labour — labour is not only physical work like say fertilizing, plowing, seeding, maintenance, irrigation, harvesting, shipping to market. Labour is applying a set of knowledges and know-how every day or else the output will not balance the input. This is an economic model practiced every year by hundreds of thousands of farmers.
Of necessity the farmer interacts with dozens of intermediaries; providers of fuel, fertilizer, machinery, etc. and service providers; bankers, wholesalers, accountants, etc. and governments. Without food there is no economy. It is almost impossible for a farmer to gain by corrupting his enterprise.
Though the farmer may inevitably be forced to corrupt his enterprise. Intermediaries like seed providers may introduce seed which is modified and leads to mono cropping and a gradual disappearance of seed variety. Banksters! may raise interest rates which may cause some farmers to declare bankruptcy. Wholesalers may bid down crop prices. Seed companies like Monsanto come to monopolize seed production specialized fertilizer and their pricing power may force some farmers out of business. The farmer’s accountant may sell the business to a larger firm and the cost of acquisition has to be amortized so the new accounting firm raises their prices.
Then the farmer is forced to sell. Who buys the farm? Probably a buyer with deep pockets. Probably a buyer who already own thousands of acres. Maybe the buyer is a corporation. Maybe the corporation is listed on a stock exchange. Corporations as a rule are run by people who understand the intricacies of juicing valuations. The corporation clears the farms they buy of buildings. Corporate lawyers and corporate accounts understand exactly how to avail their corporate farming enterprise, of every single government farm support rebate, tax abatement, incentive, as well as how to embellish the book price of the farms they purchase.
Financial leveraging occurs when the stock market price for the land when added to the existing portfolio is valued up, i.e. leveraged up, and for accounting purposes depreciated. Or leveraged financially. Borrowing far more money pledged against the value of the land than the farmer received when he sold the land. Maybe 20x as much. Share prices are peculiar animals.
Say the farmer earned $100,000 after expenses and taxes. Certainly the farm produced more revenue than $100,000. Say the raw land without the financial restraint which the farmer faced
is made way more productive. …The corporation avails itself of volume discounts for seed and fertilizer. And better bank financing. And deploys the most up to date machinery when plowing, seeding, and applying fertilizer and cropping, etc. and maybe finds a way to depreciate the value of the land for tax purposes which does not affect the book value of the land for stock market listing purposes — clearly the machinations available to the corporation justifies accumulating land.
The fly in the ointment is this: The farmer may have had a line of credit the bank refused to increase. Maybe he had no mortgage on the land. But after the corporation has run the land through the financial sausage machine the land may in fact be burdened with a cascade of counterparty debt.
Probably will be. The land is used to leverage the price they paid for the land into the stratosphere.
I used here farming and land to illustrate the way corporations emerge from an easily digestible example. But the same consolidation of enterprises is always taking place. The more efficient consolidates the less efficient. Is it only more efficient in the abstract? Is the crop better? Is it adulterated? Do extensive corporate links enable top down generalized decisions — predicated on markets, market partners (like Monsanto), stock prices, stock dilution, stock buy back strategies, integration with foreign subsidiaries, tax considerations, corporate executive ambitions — which in fact compromise the sort of decisions the farmer would have made responding to local conditions.
If the market did collapse in a generalized melt down. Maybe the consequences would be immediately painful for the myriad holders of financial instruments but the process of weeding out the inefficient aspects of Wall Street financial inefficiencies may be somewhat like the sort of thing a farmer did with a noxious infestation of Government interventionists.
Corporations are far more likely to pollute than our farmer. Corporations employ armies of lawyers to lobby for generalized exemptions to certain good and healthy practices our farmer may have practiced without rules or supervision. Why does every endeavour humans engage in necessitate the promulgations of the “bigger is better” trope. Does that farmland produce betterment because an army of disconnected Ivy League graduates know better than our farmer what ought to be initiated?
It appears that the financialization of the economy may have reached the point where it can be seen as destructive, and overbearing, rather than constructive, as it is purported to be. Financialization is a process whereby financial markets, financial institutions, and financial elites gain greater and greater influence over economic policy and economic outcomes. Financialization is capitalism corrupted! Financialization transform a functioning and healthy economic system at both the macro level (financialized military industrial complex) and the micro leveli (our farm communities.)
It is a peculiar endeavour to comment on these various blogs. One cannot write a book or expound an entire thesis. On the other hand short cryptic comments while doing a good job capturing the outrage and frustration often convey despair. It appears that the effect of shining a little light into dark corners accumulates and it is causing considerable discomfort among those operating in and from the shadows. Certainly understanding many things are done in the shadows which are intentionally done there. Many of these things have been promulgated as beneficial to Everyman but indeed they have most certainly benefited the 1% while doing nothing for the rest of us.
The 1% own and control the MSM (the main stream media.) can we realistically expect the 1% to enjoy being exposed. Financializing is no different than robbing a bank. It is a process whereby the entire economy of a country can be financially raped, i.e something taken without any semblance of
moral virtue. In fact our entire western society including the economy suffers from moral hazard.
Matt, as another commenter says below, I love your mind and I love your work. I do take a little issue with it, though.
I believe that the solar and wind energy subsidies of the IRA can be a little like pieces of the New Deal, specifically the CCC and WPA's artwork.
Solar installations, in particular (others may disagree about wind energy but I personally find them to be beautiful and awesome) are small, unobtrusive, and generate low-cost electricity with no inputs other than sunlight for decades. This is more than a little like a CCC project, which provides great use for decades after the initial work is done.
Matt, I really love your mind, in spit of your unsettling conclusions, real or unreal. But I promise you that I can prove, beyond any doubt, that this catastrophe is orchestrated-real; real bullshit, just as you’ve said. Very powerful arguments, but I would like you to answer AnnR’s question, if you would. Then I’d also like you to write in response to my previous post, not in chat, but an article giving a “list of books” you’d take to Mars and a the intelligent individuals living today you’d trust to take with you to build an honest democracy and utility infrastructure correctly in order to prevent the current maddens being played out on earth. I’ll be writing next week about each nation’s Utility infrastructure and what’s needed to end the current nightmare of pending war and scarcity, the same as I’d build it on Mars using humanity’s current science/engineering methods…and nobody would starve of freedom, food, water or energy, after the build was completed. I know you agree about the fraud of “too many” and “not enough,” because I listen to you. Your right, our problems are tragic and not of our own doing, and the solutions to save humanity, if we were allowed to build them, are much cheaper than all nations financially collapsing and world war, which is a total fraud, and I know you agree with that, too. I just don’t know what and how you’d fix it. Tell me about your solutions, if you have any, because if I were a captain of a battalion of shuttles off to Mars, I’d want you going with us, but I’m still not sure what working-solutions you’d want to develop after we landed. Hear Me: We need to prosecute Lawyer trapping us, because they are at the center of ALL the insanity, then build the Utilities humanity needs by way of cheap fair taxes from honest trade practices of the awesome, free individual. Not everyone must of should be for profit, like roads, electricity, water…Correct?
But I’m NOT a socialist or a communist, in any way, but there are some principle you can take from many ‘isms to free the people. But I’m just sick of being trapped by complex fatalisms with no real solutions, just lots of fear, certain death and war-cleansing. Help me with this.
The deadly fault of the current system is insistence on keeping intact the very power structure that has caused our current reality. The results of any system are largely determined by its most fundamental aims. If the aims are further concentration of both economic and political power in a tiny oligarchical minority, then the results will approximate those aims. No solutions are possible from the within the system. We must first, in one way or another, take away their power to set systemic goals, followed by redefining the systemic aims to serve We The People. In order to achieve this we must undergo an alchemic transformation from We The Sheeple to We The people. Apparently this is an act proving to be as difficult as turning lead into gold. ;-)
A New Monetary System with A New National Bank
A Nation’s Monetary System could be, and should be, this simple…..
A Nation’s money is owned by the citizens of the Nation.
The value of a Nation’s money is determined by the productivity (labor) of the Nation’s citizenry as expressed in the quantity and quality of the goods and services produced by the Nation’s citizenry.
A Nation’s Treasury Department adds money to a Nation’s economy through a National Bank.
A Nation’s Treasury Department subtracts money from a Nation’s economy through tax collection, i.e. Internal Revenue Service.
A National Bank manages the Nation’s money supply.
Loans increase a Nation’s money supply.
Loan repayment and taxes decrease a Nation’s money supply.
Loan interest rates control how quickly a Nation’s money supply will increase.
Tax rates control how quickly a Nation’s money supply will decrease.
A National Bank is owned by a Nation’s citizens and therefore the interest received from loans will never be siphoned off as profits to any private owner.
Only independent sovereign nations can establish a National Bank to manage the Nation’s money.
The National Bank is subordinate to the Nation’s Treasury Department.
The National Bank does not sell ownership rights to the Bank to citizens using stocks or bonds.
The National Bank is forbidden from buying and owning and trading assets, including stocks, bonds, and mortgages, both domestic and foreign.
Only the National Bank is authorized to create money by making loans to citizens and businesses, to Federal Government Agencies, and to State and Local Government Agencies.
National Bank Branches will be located in each Postal District throughout the nation.
National Bank Branches will manage loans:
Issuing, setting interest rates, evaluating applicant’s loan needs and applicant’s capability to repay their loan’s interest and principal.
Loan Types:
Monthly Revolving Credit Card:
The higher the monthly credit card limit, the higher the interest rate.
Transportation Vehicle Loan:
The more expensive the vehicle, the higher the interest rate.
Home Mortgage Loan:
The more expensive the home, the higher the interest rate.
Personal Loan:
The higher the loan amount, the higher the interest rate.
Business Loan for Business Expenses:
The higher the loan amount, the higher the interest rate.
New Business Start-Up Loan:
The higher the loan amount, the higher the interest rate. A maximum loan amount will be determined based upon risk of success or failure of the New Business. New Businesses can seek loans from non-Bank investment lenders.
Federal Government Agencies:
The National Bank will issue loans to Federal Government Agencies that will be repaid from Federal property and sales taxes, and tariffs.
State and Local Governments Agencies:
The National Bank will issue loans to State and Local Government Agencies that will be repaid from State and Local property and sales taxes.
Loans and taxes can only be paid in Bank money.
There shall be no Federal, State, and Local income taxes (personal and business). There shall only be Federal, State, and Local property and sales taxes.
Only the Federal Government can levy tariffs.
Loan interest rates and tax rates are modified to control the money supply, and thereby inflation.
Government agencies contract goods and services from citizens and businesses and other government agencies.
Federal, State and Local Government agencies submit budget requests to their governing elected representatives. Budget requests will either be approved, denied, or modified by the governing elected representatives. Approved budget requests are recorded in a national database that National Bank managers can search to confirm loan applications from Federal, State and Local Government agencies.
Welfare is a no-interest non-repayable loan (gift) to citizens based upon their poverty.
Welfare recipients have to agree to a contract with the National Bank requiring the welfare recipient to change their detrimental and self-destructive lifestyle behaviors and habits, fulfill training goals, and fulfill minimum employment requirements.
“Outsourcing of vital manufacturing, decay of infrastructure maintenance and improvement, privatization of public goods, and loss of machine tool powers simply resulted in the transfer of wealth into the hands of a small elite, and the stripping of nation states from the economic sovereignty they once enjoyed.”
Matt, you have referenced the privatization of public goods in several articles and that notion seems counterintuitive to me. Can you give a couple of examples of that and how it transferred wealth? Every time I read it, it sounds like you’re advocating for socialism of some sort, but I can’t figure it out. Thanks!!!
Our economy is not an economy. A real economy is much like a farm. The output can never exceed the input. This is certain for labour — labour is not only physical work like say fertilizing, plowing, seeding, maintenance, irrigation, harvesting, shipping to market. Labour is applying a set of knowledges and know-how every day or else the output will not balance the input. This is an economic model practiced every year by hundreds of thousands of farmers.
Of necessity the farmer interacts with dozens of intermediaries; providers of fuel, fertilizer, machinery, etc. and service providers; bankers, wholesalers, accountants, etc. and governments. Without food there is no economy. It is almost impossible for a farmer to gain by corrupting his enterprise.
Though the farmer may inevitably be forced to corrupt his enterprise. Intermediaries like seed providers may introduce seed which is modified and leads to mono cropping and a gradual disappearance of seed variety. Banksters! may raise interest rates which may cause some farmers to declare bankruptcy. Wholesalers may bid down crop prices. Seed companies like Monsanto come to monopolize seed production specialized fertilizer and their pricing power may force some farmers out of business. The farmer’s accountant may sell the business to a larger firm and the cost of acquisition has to be amortized so the new accounting firm raises their prices.
Then the farmer is forced to sell. Who buys the farm? Probably a buyer with deep pockets. Probably a buyer who already own thousands of acres. Maybe the buyer is a corporation. Maybe the corporation is listed on a stock exchange. Corporations as a rule are run by people who understand the intricacies of juicing valuations. The corporation clears the farms they buy of buildings. Corporate lawyers and corporate accounts understand exactly how to avail their corporate farming enterprise, of every single government farm support rebate, tax abatement, incentive, as well as how to embellish the book price of the farms they purchase.
Financial leveraging occurs when the stock market price for the land when added to the existing portfolio is valued up, i.e. leveraged up, and for accounting purposes depreciated. Or leveraged financially. Borrowing far more money pledged against the value of the land than the farmer received when he sold the land. Maybe 20x as much. Share prices are peculiar animals.
Say the farmer earned $100,000 after expenses and taxes. Certainly the farm produced more revenue than $100,000. Say the raw land without the financial restraint which the farmer faced
is made way more productive. …The corporation avails itself of volume discounts for seed and fertilizer. And better bank financing. And deploys the most up to date machinery when plowing, seeding, and applying fertilizer and cropping, etc. and maybe finds a way to depreciate the value of the land for tax purposes which does not affect the book value of the land for stock market listing purposes — clearly the machinations available to the corporation justifies accumulating land.
The fly in the ointment is this: The farmer may have had a line of credit the bank refused to increase. Maybe he had no mortgage on the land. But after the corporation has run the land through the financial sausage machine the land may in fact be burdened with a cascade of counterparty debt.
Probably will be. The land is used to leverage the price they paid for the land into the stratosphere.
I used here farming and land to illustrate the way corporations emerge from an easily digestible example. But the same consolidation of enterprises is always taking place. The more efficient consolidates the less efficient. Is it only more efficient in the abstract? Is the crop better? Is it adulterated? Do extensive corporate links enable top down generalized decisions — predicated on markets, market partners (like Monsanto), stock prices, stock dilution, stock buy back strategies, integration with foreign subsidiaries, tax considerations, corporate executive ambitions — which in fact compromise the sort of decisions the farmer would have made responding to local conditions.
If the market did collapse in a generalized melt down. Maybe the consequences would be immediately painful for the myriad holders of financial instruments but the process of weeding out the inefficient aspects of Wall Street financial inefficiencies may be somewhat like the sort of thing a farmer did with a noxious infestation of Government interventionists.
Corporations are far more likely to pollute than our farmer. Corporations employ armies of lawyers to lobby for generalized exemptions to certain good and healthy practices our farmer may have practiced without rules or supervision. Why does every endeavour humans engage in necessitate the promulgations of the “bigger is better” trope. Does that farmland produce betterment because an army of disconnected Ivy League graduates know better than our farmer what ought to be initiated?
It appears that the financialization of the economy may have reached the point where it can be seen as destructive, and overbearing, rather than constructive, as it is purported to be. Financialization is a process whereby financial markets, financial institutions, and financial elites gain greater and greater influence over economic policy and economic outcomes. Financialization is capitalism corrupted! Financialization transform a functioning and healthy economic system at both the macro level (financialized military industrial complex) and the micro leveli (our farm communities.)
It is a peculiar endeavour to comment on these various blogs. One cannot write a book or expound an entire thesis. On the other hand short cryptic comments while doing a good job capturing the outrage and frustration often convey despair. It appears that the effect of shining a little light into dark corners accumulates and it is causing considerable discomfort among those operating in and from the shadows. Certainly understanding many things are done in the shadows which are intentionally done there. Many of these things have been promulgated as beneficial to Everyman but indeed they have most certainly benefited the 1% while doing nothing for the rest of us.
The 1% own and control the MSM (the main stream media.) can we realistically expect the 1% to enjoy being exposed. Financializing is no different than robbing a bank. It is a process whereby the entire economy of a country can be financially raped, i.e something taken without any semblance of
moral virtue. In fact our entire western society including the economy suffers from moral hazard.
Matt, as another commenter says below, I love your mind and I love your work. I do take a little issue with it, though.
I believe that the solar and wind energy subsidies of the IRA can be a little like pieces of the New Deal, specifically the CCC and WPA's artwork.
Solar installations, in particular (others may disagree about wind energy but I personally find them to be beautiful and awesome) are small, unobtrusive, and generate low-cost electricity with no inputs other than sunlight for decades. This is more than a little like a CCC project, which provides great use for decades after the initial work is done.
Matt, I really love your mind, in spit of your unsettling conclusions, real or unreal. But I promise you that I can prove, beyond any doubt, that this catastrophe is orchestrated-real; real bullshit, just as you’ve said. Very powerful arguments, but I would like you to answer AnnR’s question, if you would. Then I’d also like you to write in response to my previous post, not in chat, but an article giving a “list of books” you’d take to Mars and a the intelligent individuals living today you’d trust to take with you to build an honest democracy and utility infrastructure correctly in order to prevent the current maddens being played out on earth. I’ll be writing next week about each nation’s Utility infrastructure and what’s needed to end the current nightmare of pending war and scarcity, the same as I’d build it on Mars using humanity’s current science/engineering methods…and nobody would starve of freedom, food, water or energy, after the build was completed. I know you agree about the fraud of “too many” and “not enough,” because I listen to you. Your right, our problems are tragic and not of our own doing, and the solutions to save humanity, if we were allowed to build them, are much cheaper than all nations financially collapsing and world war, which is a total fraud, and I know you agree with that, too. I just don’t know what and how you’d fix it. Tell me about your solutions, if you have any, because if I were a captain of a battalion of shuttles off to Mars, I’d want you going with us, but I’m still not sure what working-solutions you’d want to develop after we landed. Hear Me: We need to prosecute Lawyer trapping us, because they are at the center of ALL the insanity, then build the Utilities humanity needs by way of cheap fair taxes from honest trade practices of the awesome, free individual. Not everyone must of should be for profit, like roads, electricity, water…Correct?
But I’m NOT a socialist or a communist, in any way, but there are some principle you can take from many ‘isms to free the people. But I’m just sick of being trapped by complex fatalisms with no real solutions, just lots of fear, certain death and war-cleansing. Help me with this.