The Kabuki of ‘Markets’ as History Unfolds

Today marks the second day of the United States’s expedited meeting with China “as they work out ways for the U.S.-led world order to make room for a China that is fast accruing global influence and military power” (Associated Press. May 21, 2013).

 Historical Shifts

April-May, 2013: Orchestrated plunge in gold, silver. Stock “market” levitated. What the system does not have much of is gold, silver. Growing reports of shortage and major banks refusing to deliver physical gold belonging to clients; extended delivery delays; drainage of gold from London; ABN Ambro defaulted, refused to deliver gold but predicts a gold price collapse.

Consider a hyperinflation not in the traditional ways of the Weimars and Zimbabwes that printed currency with ink and paper, but in derivatives (a portion in above chart). Over $1,000 Trillion unprinted pretend ‘derivatives’ dollars that do not exist, mostly interest rate derivatives that hold together the interest rate structure. Inflation subdued? That depends on where asset prices would be (stock market – 401k-IRAs – bank balance sheets…) without suspending FASB’s accounting rule and printing money ‘QE’ 0-1-2-3∞ + ZIRP and multi-trillion dollar swaps.

Behind this kabuki theatre is history in the making. It is the U.S. dollar’s diminishing role as the international settlement currency for world trade (about $18 trillion merchandise trade in 2012) along with its implications. Since at least 2012, bilateral trade agreements among other nations have begun settling in non-U.S. dollars. Over the next few years, China’s economy will become the largest in the world, and with India (the people) and Russia lead the world in gold accumulation.

May 7, 2013: China announces aim of convertibility of the yuan in 2013.  [Yuan]

May 7-8, 2013: G-20 Meets in Turkey: “Reinventing Bretton Woods” [Reinventing the gold standard…]

Developing and emerging economies led by China, now hold two-thirds of foreign exchange reserves among world central banks.

May 10-11, 2013: Unscheduled Meeting of G-7 (Britain, Canada, France, Germany, Italy, Japan and the United States) over the weekend in London. Federal Reserve Bank Chairman Bernanke absent. “ ‘It’s very rare for a G-7 to focus on financial regulation,’ one of the officials said, speaking on condition of anonymity”.  Perhaps then, on the G-20’s meeting in Turkey which portends the re-entry of gold to anchor the new system. In the previous article, “Yes it is true: ‘Gold is dead.’” reports raise questions about how much gold, if any, is left at Fort Knox, which at its height vaulted about half of the gold holdings in the United States, half belonging to other countries.

May 21, 2013: : China’s President Xi to Meet with U.S. President earlier than expected, June rather than September

(AP). “The June 7-8 meeting at a retreat southeast of Los Angeles, announced Monday by the White House, underlines the importance of the relationship between the countries as they work out ways for the U.S.-led world order to make room for a China that is fast accruing global influence and military power.

President Xi has said China wants its rise to be peaceful…”

 

 

Preview to Last Section of Part II Subversion of the United States

“America will never be destroyed from the outside… it will be because we destroyed ourselves.”– Abraham Lincoln

To summarize, destroy its family, its traditions, and values – the foundations of its society. Why? Easier to control and condition the individual towards dependence and obedience to the supremacy of the state. These are the Communist International “Rules of Revolution” document found by the Allied forces in Dusseldorf, Germany after World War II. Yuri Bezmenov, Soviet KGB subversion ‘brainwashing’ expert-turned defector (Part I Ideological Subversion of the United States),  could not vouch for the authenticity of the document, but he confirmed they are near verbatim to Soviet ideological subversion in his 1984 book, Love Letter to America (26MB in parts 1, 2, 3 due to size limits). One of these rules is “Always preach democracy, but seize power as fast and as ruthlessly as possible” (p. 17).

It raises an interesting question: Were the German people also subverted, ‘brainwashed’ to accept totalitarian-fascism as the wealth behind the U.S. foundations and investment banks financed the rise of Hitler? As the Telegraph reported, these were the same foundations that funded covert operations to corral nations into the European Union following the end of World War II as several generations in the United States had been successfully ‘brainwashed’ towards the same ideology by the 1960s. Incidentally around this time as we see in Part II some of the most famous experiments in psychology were conducted in the United States to assess the level of obedience of the adult population, findings that shocked the researchers…

In 1908 when the Carnegie Endowment began its operations, the Trustees discussed a specific question: “Is there any means known more effective than war, assuming you wish to alter the life of an entire people?” and concluded there was “no more known effective means than war”.  In 1909, the Endowment (Foundation) raised a second question: “How do we involve the United States in a war?” and concluded, “We must control the State Department.” 

During WWI, the Trustees of the Carnegie Endowment dispatched a telegram to President Woodrow Wilson cautioning him to see to it that the war did not end too quickly. These were uncovered in the minutes of the Carnegie Endowment meetings during the congressional investigation in the 1950s that was halted by the White House and both sides of Congress. The director of the congressional investigation stated the Dictaphone tapes of these Endowment memorandums and meeting notes are held in the archives of the U.S. House of Representatives and within the Carnegie’s archives.

(Confirmed communist spy Alger Hiss was president of the Carnegie Endowment and David Rockefeller joined the Board at Hiss’s “invitation”. Hiss was forced to step down due to the investigation, which takes us to Covington & Burling – Yes, the law firm that created the legal foundation for MERS that expedited mortgage securitization at the center of the 2008 collapse that led to the nationwide suspension in home foreclosures in 2010 as the major banks, Fannie Mae and Freddie Mac used forged and defective documents to foreclose raising questions of broken chain of title on homes across the nation from their MERS.)

In 1917, President Woodrow Wilson appointed Robert S. Brookings to the War Industries Board (WIB) whose function was to connect business to government. President Wilson named Brookings chairman of the War Board’s Price Fixing Committee, which negotiated the maximum prices on raw industrial materials for producers during World War I. U.S. Major General Smedley Butler in his book War is a Racket (1935) cited U.S. Steel whose founder was J.P. Morgan as the leading beneficiary of World War I. J.P. Morgan combined U.S. Steel with the Carnegie Steel Company. U.S. Major General Butler wrote “War is a racket. It always has been… Only a small ‘inside’ group knows what it is about…” and ‘the American soldier follows the flag’.

Robert S. Brookings founded the Brookings Institution in 1916, one of the oldest think tanks in Washington D.C. In the previous article, “The European Union (EU) ‘Dream’ Wasn’t Even European,” the largest contributors to the Brookings Institution are the Ford Foundation and Rockefeller Foundation, Bill & Melinda Gates Foundation, and John L. Thornton of Goldman Sachs.  Nearly a century later, the Brookings Institution is where Robert Rubin and Lawrence Summers – with former Federal Reserve Bank Chairman Alan Greenspan – who were instrumental in the proliferation of derivatives that collapsed the U.S. economy in 2008, gather to promote economic growth and health care, the last area to be taken under centralized control. A correction may be required when 401k and retirement plans are nationalized.

In 1976, Congressman Larry P. McDonald wrote in the book introduction,

 “The drive of the Rockefellers and their allies is to create a one-world government combining supercapitalism and Communism under the same tent, all under their control. … Do I mean conspiracy? Yes I do. I am convinced there is such a plot, international in scope, generations old in planning, and incredibly evil in intent.”

On June 2, 1983  W.A. Harriman, elder statesman of the Democratic party, flew to Moscow as a private citizen taking along a State Department translator for a confidential chat with Yuri Andropov, General Secretary of the Communist Party of the Soviet Union (Sutton).  Not even the U.S. President or Vice-President had met with the new leader of the Soviet Union. Sutton noted the interesting timing as about three months later on September 1, 1983 Congressman McDonald was killed with 269 other passengers when Korean Airlines 747 was shot down by the Soviets.  Yuri Bezmenov believed Congressman McDonald was the target, premeditated at the highest levels (1983 video).

Yuri Bezmenov’s former boss was head of Soviet KGB Yuri Andropov who became General Secretary of the Soviet Union with whom W.A. Harriman held a private meeting. A few weeks after the downing of Korean Airlines 747, the New York Times reported former President Nixon denied the Soviet’s claims that he canceled his seat on the same flight that killed Congressman McDonald (“Moscow asserts Nixon canceled seat on Korean 747.” NYT Sept 25, 1983).  [Henry Kissinger was President Nixon’s national security advisor, whose order of importance at the White House was to respond first to calls from Nelson Rockefeller, then movie stars and celebrities, then the U.S. President (Woodward & Bernstein. (1976). The Final Days p.193). Kissinger-Rockefeller and the Iranian people’s billions are in Part II].

Who were the most vocal voices that assailed the communist hearings? The same W.A. Harriman, elder statesman of the Democratic party and partner in Brown Brothers Harriman & Co., the oldest investment bank in the United States. Another was Senator Prescott S. Bush – patriarch of 41st and 43rd U.S. presidents – Harriman’s partner at the investment bank for over 40 years, both financiers of Hitler’s Third Reich. It does not end there…

Sutton (1986, updated 2002) identified Brown Brothers Harriman & Co., J.P. Morgan, and Covington & Burling among their conduits over the past century. There is a London counterpart…

These series of previews and excerpts are assembled in Part II Subversion of the United States. Consider what mosaic emerges. “Too big to bail”-“Too big to fail”-“Too big to jail” banks. Catchy, yes. Just overlook the mechanisms that maintain the interest rate structure, the Treasury bond market, stock market… Consider the top U.S. attorney general who refused to investigate mortgage fraud in 2008 and the new SEC head, as both shared the same revolving door that leads back to Standard Oil tankers being manned by Nazi officers.

In Part I, back in the 1930s Premier Mussolini praised “President Roosevelt’s new plan for coordination of industry follows precisely the lines of Fascist cooperation… Dictatorships are inevitable.” (“Mussolini Sees World Driven Toward Fascism.” New York Times June 4, 1933) what  America’s leading socialist, Norman Thomas described as “in effect what President Roosevelt has done has been to lay the foundation for an immense structure of State capitalism. (“Is the New Deal Socialism? A Socialist Answers.” NYT June 18, 1933). What might this look like? The chart may remind some of the Hegelian dialectic over the left and right in the United States.

 

Bezmenov (1983 interview on subversion of the United States): “Situation is NOT under control. System is disgustingly out of control.”

 

Part I: Ideological Subversion, Psychological War on the United States

 “This [U.S. Constitution] is likely to be well administered for a course of years and can only end in Despotism… when the people shall become so corrupted as to need despotic government, being incapable of any other.”      

 – Benjamin Franklin, Founding Father (81 years of age), Speech at the Signing of the Constitution of the United States on September 17, 1787.

I have not written about “fiscal cliff” or debt ceiling issues. The data is simple: there is no feasible economic growth to solve these problems and more so, tied to over $1,000 trillion in OTC notional derivatives (imaginary money) embedded in the quasi-private Federal Reserve Bank’s largest member banks and financial institutions that have been suspended from the black hole since 2008. The Federal Reserve Bank’s printed $20 trillion+ over that period (The Federal Reserve Bank’s Love Affair in QE 0-1-2-3∞, The Federal Reserve Bank is Naked, Beyond QE) is not enough for its member banks as the authorities are looking to help “manage” (protect) Americans from their $19 trillion in retirement savings accounts. It seems an ideal environment. Before a few fall off their chairs, it can be useful to look beyond chart movements as the truth leaks out from time to time for some time.

First, I would like to share a monetary experience not found in Ph.D. economics. After the communist North Viet Nam took over the more free and prosperous South in 1975, the communist government “State” confiscated all the guns (and priests). After an interlude, the State introduced without warning a new currency that took immediate effect. Gold disappeared. People were allowed to exchange a certain amount of old currency for the new currency to “equalize” everyone – control an unstated purpose and the State wanted to know who had what. What people could not exchange became worthless paper. There was panic, pandemonium as people furiously spent the old currency on food and goods, pushing up prices; our produce could not keep up with demand. Those with cash below the exchange limit took the old currency, but that did not solve the problem of inflation and another currency revaluation. People with gold (few put anything in banks) were insulated from these changes and preserved some independence from the State. Sociologist Vu Duc Vuong explained the Vietnamese’s centuries-old attachment to gold, “Empires may fall, currencies may change… gold will always survive.”

Indoctrination was constant. To protect the population, the communists shot people who fled the country to prove the dangers of having a gun. The State had a “see something, say something” program where their informers reported back suspicious activity in the neighborhood. Poor Mom was reported to the State when she sold our pool table because the cash could be used to fund terrorism against the State, such as to feed the family. The State was also concerned about our diet and dropped by to see what we were eating in case the food differed from what the collective ate. To protect us from leaving the communist paradise, the State visited to ensure we were safe. As a shared sacrifice, the State asked to borrow our home permanently, never mind that we lived there. They took it over when we disappeared.

The village elders have a saying that is translated as: “Hide the hand that throws the stone.” It may be that it is a hand that plays all sides, loyal to no nation or peoples.

I.  Ideological Subversion, Psychological Warfare: (Back) Into the Lion’s Den

Ideological subversion or psychological warfare is a “process which is legitimate, overt… to change the perception of reality of every American to such an extent that despite the abundance of information no one is able to come to sensible conclusions in the interest of defending themselves, their families…their country… [E]xposure to true information does not matter anymore. A person who is demoralized is unable to assess true information. The facts tell nothing to him.”

“[P]romise people all kind of goodies and “paradise of earth”, to destabilize your economy, to eliminate the principal of free-market competition and to put a “Big Brother” government… In other words, Marxism-Leninism ideology is being pumped into the soft heads of at least three generations of American students without being challenged or counterbalanced by the basic values of Americanism, American patriotism…”

“[I]ndividuals who were instrumental in creating public opinion: publishers, editors, journalists, actors, educationalists, professors .. business circles… would be promoted to positions of power through media and public opinion manipulation… large circulation, established, conservative media…filthy rich movie makers, intellectuals, so-called academic circles. Cynical, ego-centric people…are the most recruitable people, people who lack moral principals, who are either too greedy or suffer from self-importance…”

“The result? The result you can see. Most of the people who graduated in the ‘60s, drop outs or half-baked intellectuals are now occupying the positions of power in the governments, civil service, business, mass media, educational system… They are contaminated.”

The demoralization process in the United States is basically completed already for the last 25 years. Actually, it’s over fulfilled…  United States is in a state of war. Undeclared total war against the basic principals and foundations of this system. And the initiator of this war is not comrade Andropov [Head KGB].”   Yuri Bezmenov, KGB Subversion Expert, Soviet Defector excerpts from 1984 Interview.Transcript further below. (1 Hour Interview Full Version)

Yuri Bezmenov was perhaps aware more than most that a few notable Wall Street banks and their founding of their quasi-private Federal Reserve Bank, and U.S. industrialists-corporations (Ford, GE, Rockefeller’s Standard Oil…) financed among others, communists of the Bolshevik Revolution later renamed Communist Party of the Soviet Union in 1952, building up the Soviet Union whose weaponry was later used against U.S. soldiers and the Vietnamese in the South during the Viet Nam war. These financiers backed both Franklin Delano Roosevelt and Hitler’s Nazi rise into the profits of World War II that gave birth to a set of twins, the New Deal and the New Order. The financiers, FDR, Hitler and Mussolini shared mutual admiration for State control and low regard for free markets.

By the 1930s

In an interview with the New York Times on June 4, 1933  Premier Mussolini praised, “President Roosevelt’s new plan for coordination of industry follows precisely the lines of Fascist cooperationContinue reading