• When debt is fraudulent, debt forgiveness is the logical and only remedy.
• Debt or credit which cannot be paid back is never an asset; it is always a liability.
• All debt which charges a percentage originates in delusion. Debt grows exponentially indefinitely; income and other financial growth cannot do this.
• The total amount of money in circulation today in the West can only pay for a tiny fraction of the total private and public debt in the West. This fact is evidence of systemic fraud.
• Debt is manufactured through fraudulent means to reward a creative criminal élite.
• If the intention of a financial transaction tied to a loan, or tied to a financial inducement, is extortion, if it is, in effect, an élite bankster scheme to bamboozle the borrower with small print or to blind him with science, that loan or inducement, should be struck off the record immediately and completely. The debt was not incurred with the informed consent of the borrower. The debt did not benefit the borrower. And the élite lender was well aware of these facts when the loan papers were signed.
• You cannot solve the debt problem by issuing more debt. You solve the debt problem by cancelling, completely, all national, corporate and personal debt. You do this simultaneously across the planet, and you do it permanently.
You don’t need a slide rule, a set of log tables or a high frequency trading algorithm to see the light. Everyone on Main Street now knows that the Western cabal’s fixation with fiat-paper capitalism is a busted flush. Debt does not work as the basis of a global financial system.
Behind the scenes, all the indications are that universal debt forgiveness is set to be announced. A global debt jubilee is waiting in the wings. The Doctrine of Odious Debts has been spectacularly revisited. The default position of the global financial system is to be permanently reset. The vaults are stocked. The precious metals are audited. The new gold-backed regional currencies are printed, minted and ready.
The most recent catalyst for change has been Iraq. Before the Western cabal’s US-UK war of occupation and plunder began in Iraq in March 2003, Iraqi exiles expressed the hope that in a post-Saddam democratic Iraq, there would be a fair and equitable disposition of Saddam’s debts.
These Iraqis wanted the future administration of Iraq and the international community to review the debts accumulated under Saddam’s régime. Those loans which had been used for benign purposes should be restructured and paid back by Iraq over a prudent time period. Those loans which were used for objectionable purposes and which did nothing to enhance the well-being or prosperity of the Iraqi population at large, should be struck off the record immediately and completely.
This illustrates one of the core principles of debt forgiveness. Why should Iraqis be forced to repay the US, the British, the French, the Germans, the Russians, and all the others who had financially supported Saddam’s oppression of them?
The Iraqi argument for debt forgiveness had a sound basis in law. It reflects the century-old legal principle of the Doctrine of Odious Debts.
The Doctrine of Odious Debts was created to further international finance by limiting the ability of governments to repudiate debts. Three conditions had to apply before a sovereign state could repudiate a debt:
(1) The debt must have been incurred without the informed consent of the citizenry of the state.
(2) The debt must not have benefitted the citizenry of the state.
(3) The lender must have been aware of conditions (1) and (2) at the time that the loan papers were signed.
The United States employed these principles after the Spanish-American War to repudiate the Cuban debts.
If a despotic power incurs a debt which is manifestly not for the needs of the State, or not in the plain interest of the State, but is a debt incurred solely to strengthen the position of the despotic cabal as a self-serving faction within that State, the debt is odious. The debt is not an obligation for the nation; it is a cabal debt, a personal debt of the cabal which incurred it. And the debt falls with the fall of the cabal.
The Doctrine of Odious Debts not only promotes accountability, it promotes democracy in the debtor state as, one by one, the nature of the inherited debts are articulated in a public legislature.
The Doctrine of Odious Debts also promotes democracy in creditor states. In Canada and most European nations, the lending of state enterprises is generally hidden from taxpayers. Canada’s export credit agency, Export Development Canada, for example, is exempt from Canada’s Access to Information law.
In the case of Iraq, state agencies from France, Germany and Russia may have made questionable loans. Under an odious debt process, they would need to establish that they acted with due diligence to be entitled to repayment. Knowing this, they would be less likely to make questionable loans in the future.
Debt forgiveness and the Doctrine of Odious Debts also applies to individuals. The same principles have legal traction on loans or structured financial inducements made by financial institutions such as banks, mortgage lenders, insurance companies, stock-trading entities, energy conglomerates and pharmaceutical firms.
If the intention of the financial transaction tied to the loan, or tied to the financial inducement, is extortion, if it is, in effect, an élite scheme to bamboozle the borrower with small print or to blind him with science, that loan or inducement, should be struck off the record immediately and completely. The debt was not incurred with the informed consent of the borrower. The debt did not benefit the borrower. And the lender was well aware of these facts when the loan papers were signed.
Universal debt forgiveness is on the way as an essential precursor to the planet’s new gold-backed financial system. It has deep historical roots and powerful support in natural law. This imminent global debt jubilee is organically related to the disbursement of The World Global Settlement Funds, to the long-planned public NESARA announcements, and to the opening of Pandora’s Suitcase.
More background about the concept of the Odious Debt can be found here (pdf – 11 pages – Jayachandran and Kremer) and, in the specific context of Greece in 2011, here. Murray Rothbard’s original 2004 piece on Repudiating the US National Debt can be found here. And The Center for Global Development’s 2010 review entitled: “Whatever Happened to the Jubilee? A 10th Anniversary Assessment of the Debt Relief Movement” is linked here.
But other economists have been vocal on the debt forgiveness issue as well. In particular, Zeus Yiamouyiannis (plus here, here and here), Steve Keen (plus here) and Michael Hudson (plus here).
Citing both Keen and Hudson, Yiamouyiannis is persuasive. When debt is fraudulent, debt forgiveness is both the logical and the only remedy for the situation. Whatever the name you give to the process – erasure, repudiation, abolishment, cancellation, jubilee – debt forgiveness will eventually have to emerge at the forefront of global efforts to solve the ongoing systemic financial crisis.
The only way to erase counterfeit money and counterfeit assets amounting to hundreds of trillions of dollars is to erase the debts associated with these fake assets. They are not toxic assets. They are fake assets.
Debt forgiveness accomplishes two important things. First, it eliminates the increasing and outsized portion of productive enterprise which is being employed to pay off unproductive obligations. Second, it clears the ground for new opportunities, new thinking, creative invention and positive entrepreneurialism.
Stentorian calls for austerity are nothing more than the delusional efforts of a fraudulent bankster status quo to avoid the consequences of its own error and fraud. The élite demands for austerity are a self-serving effort to kick the profit-can down the road in perpetuity. So bedazzled by the false wealth created by debt multiplication and its concomitant fantasy of ever-higher returns, the fraudulent bankster status quo continues to be stupidly amazed that ordinary people in the street are not spending money, and that the national economy is not picking up.
Productive human wealth has been trapped by establishment banksters in a web of parasitic theft, counterfeiting, liability evasion, non-regulation, and prosecutorial non-accountability. All the fundamental attributes of a functioning exchange economy have been warped to reward creative criminals.
Fabricated or parasitic so-called “wealth” destroys value by diluting the value of real productive wealth. Debt or credit which cannot be paid back is never an asset; it is always a liability. That some people in the market can be fooled into buying such liabilities and thus generate sale profits and transaction fees is risible.
The operating models upon which the modern debt nexus is historically based have no organic contact with reality. They assume unlimited growth and an unlimited ability to pay. When matched against the reality of real people paying ten times their salary for mortgages, which actually add more money owed to their principal (with negative amortization), require no money down, and set up balloon payments – large step-ups in payments after a few years – there is no possible way such people could not default within a predictable timespan.
Systemically, all debt which charges a percentage originates in delusion. Debt grows exponentially indefinitely; income and other growth cannot do this. This leads to a widening condition where the fruits of productive growth devoted to interest payments increase until those fruits are entirely consumed. Once this happens, stores of wealth (hard assets) begin to be cannibalised to make up the difference. You can see this now in Middle America where, absurdly, people are having to liquidate their retirement accounts to pay for their current cost of living.
The problem is compounded by a privately owned Federal Reserve syndicate which lends money into circulation at interest, and then allows the multiplication of this consumer debt-money liability through fractional reserve banking.
The total amount of money in circulation today can pay for only a tiny fraction of the total private and public debt. This fact alone is evidence of a kind of systemic fraud. This is why debt forgiveness makes not only moral, but also rational and mathematical sense. Finances require balancing to be coherent. There has to be some way to redress the systemic imbalance in Western macrofinance. There has to be some way to zero the scales in order to get an accurate weight of value, and to re-establish healthy value creation.
The problem with debt is that it creates scarcity. Scarcity stimulates fear. Fear drives manic competition. And manic competition favors opportunism, collusion, and concentrations of power. These élite concentrations of power translate into establishment abuse. The inevitable result is a visible collapse of legitimacy within the economic system. This is what is being seen now, all over the Western World, by Joe Public and his missus.
Debt forgiveness recognises the inherent, systemic, mathematical inability to make good on debts, and (or) the naked fact that the debt itself was manufactured through fraudulent means.
The foregoing twelve paragraphs précis some of the ideas which Zeus Yiamouyiannis has suggested in his writing on debt forgiveness. The best brief summary of his thoughts is probably here (01.09.11).
The situation is plain. You cannot solve the debt problem by issuing more debt. You solve the debt problem by cancelling, completely, all national, corporate and personal debt. You do this simultaneously across the planet, and you do it permanently. And then you recapitalise the whole bangshoot using an established resource base such as The World Global Settlement Funds and the associated US Dollar Refunding Project.
This next bit sounds exotic. But in future years it may well sound like a blinding glimpse of the obvious. You don’t establish the value of something by sticking it in a market. You establish the value of something by giving it away free and seeing what social value accrues as that something is used locally to energise cooperative livelihoods and free barter.
Interestingly, the core idea of global debt forgiveness is not restricted to the benevolent ivory towers of economic utopians. It is beginning to be talked about, in public, by national parliamentarians.
At the end of August 2011, in Ireland, the Irish Finance Minister, Michael Noonan, had to respond to organised calls for debt forgiveness in connection with his EuroZone nation’s struggling mortgage borrowers. The story was run prominently in the Business section of the Irish Times on Friday 2nd September 2011. Its headline was: “Minister rules out ‘free-for-all’ debt forgiveness. Noonan insists there is no magic bullet.” The article, by Simon Carswell and Colm Keena, can be found here.
In Greece, debt forgiveness appears to be further advanced than in Ireland. At the end of September 2011, an important legal precedent was established. In accordance with a district court order in Larissa, an unemployed Greek woman who owed a little over 26,000 Euros to two banks, Eurobank and National, received a full debt discharge on her outstanding loans. The woman had a perfect payment record for eighteen years, and only fell behind when she lost her job. It is thought that the decision will probably be adhered to in thousands of similar cases. More here (02.10.11). And some locally-sourced film commentary on repudiating the Greek national debt can be found here (20.06.11).
Picture: G5 Western banking cartel. Global Debt Forgiveness is inevitable.
Each and every time a bank makes a loan (or purchases securities), new bank credit is created – new deposits – brand new money.
Graham F. Towers
The process by which banks create money is so simple the mind is repelled.
John Kenneth Galbraith
Permit me to issue and control the money of a nation, and I care not who makes its laws.
Mayer Amschel Rothschild
I am afraid that the ordinary citizen will not like to be told that banks can and do create money …. and they who control the credit of the nation direct the policy of Governments
and hold in the hollow of their hands the destiny of the people.
Our national circulating medium is now at the mercy of loan transactions of banks, which lend, not money, but promises to supply money they do not possess.
That is what our money system is. If there were no debts in our money system, there wouldn’t be any money.
Marriner S. Eccles
Everyone sub-consciously knows banks do not lend money. When you draw on your savings account, the bank doesn’t tell you you can’t do this because it has lent the money to somebody else.
If all the bank loans were paid, no one could have a bank deposit, and there would not be a dollar of coin or currency in circulation. This is a staggering thought. We are completely dependent on the commercial banks. Someone has to borrow every dollar we have in circulation, cash, or credit. If the banks create ample synthetic money we are prosperous; if not, we starve. We are absolutely without a permanent money system. When one gets a complete grasp of the picture, the tragic absurdity of our hopeless situation is almost incredible, but there it is.
One thing to realize about our fractional reserve banking system is that, like a child’s game of musical chairs, as long as the music is playing, there are no losers.
I have never yet had anyone who could, through the use of logic and reason, justify the Federal Government borrowing the use of its own money. I believe the time will come when people will demand that this be changed. I believe the time will come in this country when they will actually blame you and me and everyone else connected with the Congress for sitting idly by and permitting such an idiotic system to continue.
Money is a new form of slavery, and distinguishable from the old simply by the fact that it is impersonal, that there is no human relation between master and slave.
The modern banking system manufactures money out of nothing. The process is perhaps the most astounding piece of sleight of hand that was ever invented. Banking was conceived in iniquity and born in sin. Bankers own the Earth. Take it away from them, but leave them the power to create money, and with the flick of the pen they will create enough money to buy it back again. Take this great power away from them and all great fortunes like mine will disappear, and they ought to disappear, for then this would be a better and happier world to live in. But if you want to continue to be slaves of the banks and pay the cost of your own slavery, then let bankers continue to create money and control credit.
Throughout the ages, the devices of cunning men have turned money to their nefarious purposes. Money, beginning with private enterprise as a means of escaping the limitation of barter, soon developed the cheat to exploit the honest trader who, in an effort to protect himself, turned to government for protection, only to find that now he had two thieves, the private money changer and the political plunderer working hand in glove against him. By this combination the money changer gained the prestige of political sanction through legislative license and the state secured a deceptive device for laying taxes upon the citizenry by means of the hidden tax called inflation. It was and remains a vicious alliance.
All of the perplexities, confusion, and distress in America arises, not from the defects of the Constitution or Confederation, not from want of honor or virtue, so much as from downright ignorance of the nature of coin, credit, and circulation.
Whoever controls the volume of money in our country is absolute master of all industry and commerce, and when you realize that the entire system is very easily controlled, one way or another, by a few powerful men at the top, you will not have to be told how periods of inflation and depression originate.
James A. Garfield
The Government should create, issue, and circulate all the currency and credits needed to satisfy the spending power of the Government and the buying power of consumers. By the adoption of these principles, the taxpayers will be saved immense sums of interest. The privilege of creating and issuing money is not only the supreme prerogative of government, but it is the government’s greatest creative opportunity.
Once a nation parts with the control of its currency and credit, it matters not who makes that nation’s laws. Usury, once in control, will wreck any nation. Until the control of the issue of currency and credit is restored to government and recognised as its most sacred responsibility, all talk of the sovereignty of parliament and of democracy is idle and futile.
William Lyon Mackenzie King
For more than a century, ideological extremists at either end of the political spectrum have seized upon well-publicized incidents to attack the Rockefeller family for the inordinate influence they claim we wield over American political and economic institutions.
Some even believe we are part of a secret cabal working against the best interests of the United States, characterizing my family and me as “internationalists” and of conspiring with others around the world to build a more integrated global political and economic structure – one world, if you will. If that’s the charge, I stand guilty, and I am proud of it.
Only the small secrets need to be protected. The big ones are kept secret by public incredulity.
The world is governed by very different personages from what is imagined by those who are not behind the scenes. The governments of the present day have to deal not merely with other governments, with emperors, kings and ministers, but also with the secret societies which have everywhere their unscrupulous agents, and can at the last moment upset all the governments plans.
In March 1915, the J.P. Morgan interests, the steel, shipbuilding, and powder interest, and their subsidiary organizations, got together twelve men high up in the newspaper world and employed them to select the most influential newspapers in the United States and sufficient number of them to control generally the policy of the daily press. They found it was only necessary to purchase the control of twenty five of the greatest papers. An agreement was reached. The policy of the papers was bought, to be paid for by the month. An editor was furnished for each paper to properly supervise and edit information regarding the questions of preparedness, militarism, financial policies, and other things of national and international nature considered vital to the interests of the purchasers.
The real menace of our republic is this invisible government which like a giant octopus sprawls its slimy length over city, state and nation. Like the octopus of real life, it operates under cover of a self created screen. At the head of this octopus are the Rockefeller Standard Oil interests and a small group of powerful banking houses generally referred to as international bankers. The little coterie of powerful international bankers virtually run the United States government for their own selfish purposes. They practically control both political parties.
John F. Hylan
From the days of Spartacus, Wieskhopf, Karl Marx, Trotsky, Rosa Luxemberg, and Emma Goldman, this world conspiracy has been steadily growing. This conspiracy played a definite recognizable role in the tragedy of the French revolution. It has been the mainspring of every subversive movement during the 19th century. And now at last this band of extraordinary personalities from the underworld of the great cities of Europe and America have gripped the Russian people by the hair of their head and have become the undisputed masters of that enormous empire.
The government of the Western nations, whether monarchical or republican, had passed into the invisible hands of a plutocracy, international in power and grasp. It was, I venture to suggest, this semi-occult power which pushed the mass of the American people into the cauldron of World War I.
For a long time I felt that Franklin Delano Roosevelt had developed many thoughts and ideas that were his own to benefit this country, the United States. But he didn’t. Most of his thoughts, his political ammunition, as it were, were carefully manufactured for him in advanced by the Council on Foreign Relations, the One World Money group. Brilliantly, with great gusto, like a fine piece of artillery, he exploded that prepared ammunition in the middle of an unsuspecting target, the American people, and thus paid off and returned his internationalist political support. The UN is but a long-range, international banking apparatus clearly set up for financial and economic profit by a small group of powerful One World revolutionaries, hungry for profit and power. The depression was the calculated shearing of the public by the World Money powers, triggered by the planned sudden shortage of supply of call money in the New York money market. The One World Government leaders and their ever close bankers have now acquired full control of the money and credit machinery of the US via the creation of the privately owned Federal Reserve Bank.
A definite factor in getting a lie believed is the size of the lie. The broad mass of the people, in the simplicity of their hearts, more easily fall victim to a big lie than to a small one.
It seems to me perfectly in the cards that there will be within the next generation or so a pharmacological method of making people love their servitude, and producing a kind of painless concentration camp for entire societies, so that people will in fact have their liberties taken away from them but will rather enjoy it, because they will be distracted from any desire to rebel by propaganda, brainwashing, or brainwashing enhanced by pharmacological methods.
I know the secret of making the average American believe anything I want him to. Just let me control television. You put something on the television and it becomes reality. If the world outside the TV set contradicts the images, people start trying to change the world to make it like the TV set images.
Our job is to give people not what they want, but what we decide they ought to have.
The powers of financial capitalism had another far reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements, arrived at in frequent private meetings and conferences. The apex of the system was the Bank for International Settlements in Basle, Switzerland, a private bank owned and controlled by the worlds’ central banks which were themselves private corporations. The growth of financial capitalism made possible a centralization of world economic control and use of this power for the direct benefit of financiers and the indirect injury of all other economic groups.
There is a small circle of men who control the world’s finance. Each member, before initiation, knows its religion to be reward for friends and extermination of enemies.
Once a man is within the magic circle, punishment for disloyalty is sure and terrible, and in no corner of the Earth can he escape it, nor can any power on Earth protect him from it.
Those who manipulate this unseen mechanism of society constitute an invisible government which is the true ruling power of our country. Our minds are moulded, our tastes are formed, our ideas suggested, largely by men we have never heard of.
I think the subject which will be of most importance politically is mass psychology. Various results will soon be arrived at. The influence of home is obstructive. The science of psychology will be diligently studied, but it will be rigidly confined to the governing class. The populace will not be allowed to know how its convictions were generated. When the technique has been perfected, every government that has been in charge of education for a generation will be able to control its subjects securely without the need of armies or policemen. Educational propaganda, with government help, could achieve this result in a generation. There are, however, two powerful forces opposed to such a policy. One is religion, the other is nationalism. A scientific world society cannot be stable unless there is a world government.
If two parties, instead of being a bank and an individual, were an individual and an individual, they could not inflate the circulating medium by a loan transaction, for the simple reason that the lender could not lend what he didn’t have, as banks can do. Only commercial banks and trust companies can lend money that they manufacture by lending it.
The study of money, above all other fields in economics, is one in which complexity is used to disguise truth or to evade truth, not to reveal it.
John Kenneth Galbraith
The issue which has swept down the centuries and which will have to be fought sooner or later is the people versus the banks.
John Emerich Edward Acton
Commercial banks create chequebook money whenever they grant a loan, simply by adding new deposit dollars in accounts on their books in exchange for a borrower’s IOU. Banks lend by creating credit. They create the means of payment out of nothing.
Ralph M. Hawtrey
The decrease in purchasing power incurred by holders of money due to inflation imparts gains to the issuers of money.
St Louis Federal Reserve Bank
The entire world economy rests on the consumer. If he ever stops spending money he doesn’t have on things he doesn’t need, we’re done for.
With the monetary system we have now, the careful saving of a lifetime can be wiped out in an eyeblink.
When a government is dependent upon bankers for money, they and not the leaders of the government control the situation, since the hand that gives is above the hand that takes. Money has no motherland; financiers are without patriotism and without decency; their sole object is gain.
I wouldn’t go to war again as I have done to protect some lousy investment of the bankers. There are only two things we should fight for. One is the defense of our homes and the other is the Bill of Rights. War for any other reason is simply a racket.
Smedley Darlington Butler
There is nothing left now for us but to get ever deeper and deeper into debt to the banking system in order to provide the increasing amounts of money the nation requires for its expansion and growth. Our money system is nothing better than a confidence trick. The Money Power which has been able to overshadow ostensibly responsible government is not the power of the merely ultra-rich, but is nothing more or less than a new technique to destroy money by adding and withdrawing figures in bank ledgers, without the slightest concern for the interests of the community or the real role money ought to perform therein. To allow it to become a source of revenue to private issuer’s is to create, first, a secret and illicit arm of government and, last, a rival power strong enough to ultimately overthrow all other forms of government. An honest money system is the only alternative.
When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time a legal system that authorizes it and a moral code that glorifies it.
The bank hath benefit of interest on all moneys which it creates out of nothing.
Banking doesn’t involve fraud, banking IS fraud.
Money does not pay for anything, never has, never will. It is an economic axiom as old as the hills that goods and services can be paid for only with goods and services.
Albert Jay Nock
Only when the last tree has died and the last river has been poisoned and the last fish been caught will we realize we cannot eat money.
Cree Indian Proverb
When the people of the world have a common monetary language, completely freed from every government, it will so facilitate and stabilize exchange that peace and prosperity will ensue even without world government. A union of peoples rather than a union of political governments is what this world needs.
Money is the measure by which goods are valued, the value by which goods are exchanged, and in which contracts are made payable. Every thing receives a value from its use, and the value is raised, according to its quality, quantity and demand. Money is not the value for which goods are exchanged, but the value by which they are exchanged.
As long as we cling to the superstition that we must look to government for money supply, instead of requiring it to look to us, just so long must we remain the subjects of government, and it is vain to follow this or that policy or party or ism in the hope of salvation. We can control government and our own destiny only through our money power and until we exert that power it is useless for us to debate the pros and cons of political programs. To trade goods and services is a natural right of all people. To issue the money necessary to make these exchanges is also the natural right of all people who are intelligent enough to do so. We need not beg for money. We do not need to be money slaves. We can be money masters.
In nature’s economy the currency is not money, it is life.
Sources, further links and explication here.