“Debtors are trapped, like coal miners in remote towns in the 1800’s and 1900’s. They worked their butts off, had no transportation, little free time, and they were always exhausted and sick, so they shopped at the company store. They kept getting deeper in debt and couldn’t get out. There’s even a song written about that called ‘Sixteen Tons.’ People will figure out that the currency they borrow from banks to live, to buy houses and cars, and to go to college with is simply modern-day imperialism. They are trapped in their debts, like impoverished coal miners.
“They are like the cockroach that goes into a roach motel. The roach feels great going in. It eats the poison and can’t get out. It dies. Debt is like that. It feels good borrowing money, but then the interest you must pay is like poison and you can’t get out of debt. Financially speaking, you die. The people who buy the debt, the high-yield products, can’t get out either. Police, firemen, teachers, and other public employees are all trapped in its grip because their pension plans own a lot of it and the debts will be worthless when the system revalues currency and debt, when the system returns to real money. Everybody bought this shit from the insects, high yield, guaranteed, blah, blah, and blah. It sounds great until the debtor can’t pay. It’s like an eight-lane freeway running into this shit and a goat trail trying to get out.”
“David, who are you calling the insects?”
“The financial planners who sell packaged products to dummies. They prey on the unsuspecting, like lice, ticks, and mosquitoes, all sucking blood, the money, from people who don’t realize it’s happening. The people are so dummied down by the financial media into believing that the Federal Reserve and the banks will always have some kind of safety net for them or control of the markets, they might as well be dead corpses getting eaten by bugs. Americans have been duped by the media, academic monetary theorists, underwriters who package products, and the insects who sell products. The public believes if they do what the insect says they will retire, but that’s all bullshit.
“The scam depends upon keeping markets levitated using foreign currency carry trade, like the yen dollar swap. Banks borrow in yen, use the money to prop up the market with high-frequency trades and derivatives, short down the yen for a cheap payback, puff the markets, sell product, and get fees. It’s a scam. Take an ounce of sugar, spin it into cotton candy. It looks big and wonderful until the kid takes a bite out of it. Then it’s small, real, and sticky messy. Buyers won’t get out, just like cotton candy. It only works in the imagination, not when someone takes a bite and wants their money back.”
“And the debt load? How is that a scam?”
“This debt pyramid is a giant Ponzi scam. If the people aren’t taking on enough debt, or if they try to pay down their debts, the bankers force the country into a war and have the entire country go deeper into debt. The only way out is to throw off the yoke of debt.”
“How?”
“People see that the markets aren’t working right. The bond and stock markets are artificially propped up with derivatives. Those are options, futures, and things like that, where a little money controls lots of assets. Derivatives on indexes push whole markets around, but there’s a hitch. Before a dealer writes a derivative, the customer needs to have a margin account. The customer needs to put up collateral for the write, which he borrows from the dealer in the form of short-term treasuries. Eventually, the Fed runs dry of short-term treasuries to loan to the dealers and collateral dries up. Asset values collapse. Little people lose their life savings and pension plans, inheritances, whatever. Big guys screw little guys, like always.
“Unrest from the bottom rungs of society will metastasize and spread outward and upward. It will get ugly. This happens once every five generations, like the eighty years that passed between the First and Second World Wars, and then another fifty years passed until we got into the Korean War.” David conveniently forgot facts, times and dates when he tried to make a point. “The whole system will be torn up by the roots and replaced with a new monetary system, shoving the old one aside. To put trust into the new system, at its outset banks will need gold for their foundation and silver for coinage for the people. Money must once again be trusted.”
“I get that, but why do you say there may be civil unrest?”
“You hear hundreds of politicians blather about what the other guy did wrong, about why the other party is the wrong way to go. You hear endless talking points by these politicians and by the guests on the idiotic TV and radio talk shows, but none of these panderers—and they are all idiots and panderers—ever talk about the real problem which plagues the nation. The problem is simple to define, yet none of these politicians or blatherheads will define it.”
“And that would be what?” Bob seemed intrigued.
“The entire world is using dishonest fiat money. All this paper money has counterparty default risk, the risk that some government—America’s , Italy’s, France’s, China’s, Japan’s, California’s, Chicago’s or whoever’s—will fail. They all owe each other. When one fails, it sets off a daisy chain. They all fail.
“This risk of global default exists because fiat is the antithesis of constitutional real money, which is silver and gold. The Founding Fathers knew real money was the key to sustaining the republic because it keeps government honest and makes government work for the people instead of making people work for the government like we have now. They knew what they were doing. It’s simple.
“The financial crisis of 2007 and 2008 was the tip of an iceberg, the first hint of the Great Fiat Currency Crisis that will follow. It was only sub-prime mortgage and mortgage-backed securities markets getting rattled, along with minor shakes in equity markets. Look at it as a minor tremor before big earthquakes.”
“But I thought the TARP program and the Quantitative Easing, Operation Twist, the Fed blowing up their balance sheet with four to five trillion of garbage paper they bought off banks’ balance sheets solved all that. Bailouts worked. Not true?” Bob asked for clarification.
“Nowhere close. The 2007 to 2008 financial crisis was just the first inning of a nine-inning ball game. The bailouts bought banks some time to restructure their criminal activities and put a backdoor escape in place for the next round. Banks and regulators all know the bail-outs didn’t solve the problem. That’s why they passed the Dodd Frank legislation, so the brokerage firms could duck under bank holding company umbrellas and continue issuing junk loans. Under Dodd Frank, the banks’ subsidiaries’ assets can be seized or ‘bailed in’ in our coming currency meltdown. It’s spelled out in the customer agreements of the big brokerage firms, and banks and trust companies that operate under bank holding company umbrellas. It’s there, but the public doesn’t read, doesn’t want to know the truth,” David continued.
“Which is?”
“The Great Fiat Currency Crisis was merely postponed by the bailouts. Bad debts were not written off, and bank execs never went to jail for fraud. They got bonus checks for fucking everybody with more taxes, higher prices, and for protecting the wealthy from the little guy understanding the truth. Problem loans are still there. Banks can’t use generally accepted accounting or mark bad loans to market. That would wipe them out. They must pretend everything is okay, but it isn’t because people can’t service the debt of the loans they have and the government can only service its debt if interest rates stay low. The world economy is like the HMS Titanic, doomed to go under. Right now, water’s coming in the lower decks. The guys in charge are saying everything is okay, but that’s a lie. People will drown.
“The dollar is a debt chit on a bad loan portfolio that’s taken in trade based on confidence only. The treasury notes and bills are collateral for repro trades, where both parties agree to unwind in a week or a month, whatever, but it’s a way to keep assets inflated and put cash in the hands of irresponsible parties so they can make their next payment and extend the day of reckoning. Chinese, Arabs, Persians, Russians, and many others don’t want to get stuck hold
ing dollars or any other fiat currencies because the debt load is steadily dragging the entire world into a great depression. Many countries will default on their debt, many will have worthless currencies. Dodd Frank law permits the bank holding companies to throw their subsidiaries into FDIC for liquidation and all bank subsidiaries’ customers’ assets will be in receivership, with the derivative counterparties being first hogs to the trough.”
“Which means?”
“Which means the people with bank checking and savings accounts will see their savings seized, like they did in Greece and Cyprus. This means customers of brokerage firms will have their accounts frozen and securities liquidated at huge losses and the proceeds seized. Pension and assets of trust companies in bank holding companies will see their assets frozen, liquidated, and seized as well. The world economy will seize up. There will be no ATM withdrawals, no credit cards will work, no groceries will be on the shelves. Law and order will collapse. Americans will come face-to-face with truth. They’ve been played by the bankers. They went off constitutional money in 1913 and now they’re going to find out what a hell Woodrow Wilson led them to. Both political parties went along with this scam for over a hundred years. Both parties thumbed their noses at our Founding Fathers. They played along because they got rich. Hopefully they’ll change and push for honest money and get rid of the Fed, the IMF, the World Bank, and the imperialism that goes with it.”
“Will the people go after the bankers?”
“Not at first. They will need time to figure out how they got hosed. Remember, they’re not smart in this area. First they’ll blame anybody who has money. History will probably repeat itself. The goyim will blame the Jews and raise hell with us Jews before they come to their senses. Then they’ll go after the real culprits, the bankers. They’ll go after all bankers, regardless of race, creed, sex, or religion. That’s what secular law teaches kids in school these days. We must be politically correct. I’ll believe it when I see it, but that’s the hope.
“When will the people wake up? When will they challenge banker rule?” Bob’s question required a thoughtful answer.
“People usually react to conditions after the fact, not before. That’s all they are capable of doing. They are really herd animals unable to think for themselves. They’re willing to look the other way when somebody is engaged in corruption or abuse, as long as it’s hurting someone else and they can’t see it hurting them directly. They’ll put up with a president who is a serial rapist if he promises them a bigger paycheck, even if he raids their Social Security trust fund so he can pretend he balanced the budget.
“They’ll even allow a radical terrorist to occupy the White House and commit treason as long as they think he’s not hurting them directly, as long as the damage he’s causing won’t show up until a few years into the future, as long as the NFL is on TV. They’ll let a president bomb the crap out of some little country, or let the Marines knock the snot out of some shithole on the other side of the world for the business the defense contractors get. As long as what the government is doing is to somebody else and it doesn’t affect them directly, people tune out and watch football.
“Think back to Vietnam. No one cared about the place until body bags started coming back. That made it real. People started thinking, ‘Holy shit! These are real dead bodies. These guys went off to this little place on the other side of the world and came back dead. This could happen to my kid or my boyfriend! Oh my God! What are we doing? Oh fuck! We’ve got to stop this!’ Only when people saw the consequences of not knowing what was happening did they pay attention.
“There was a college experiment where a guy was strapped to an electric chair. Students were brought into a room where they saw him through a two-way mirror. The professor conducting the experiment told each student the experiment was important. He had to know how much pain the guy in the chair could take. He told each student to turn a knob that sent electrical juice into the guy in the chair. A student turns the knob and the guy screams. The professor has the student turn up the juice and the guy screams louder. Many students participated in this experiment, and almost all kept increasing the juice to the guy. As long as it was the other guy getting hurt they didn’t give a shit. That’s the lesson here. The guy in the chair never actually got shocked, that part was all faked, but nine out of ten students had no conscience about torturing the guy in the chair. Almost everyone went along doing as they were told. Few challenged authority.
“The key to being a leader of dummies is to make enough of them think you’re looking out for them. Make them believe they are special and above it all while you’re screwing the shit out of them behind their backs. Political people excel at this. They fool the poor into voting for them by promising to give them free stuff, but the poor end up with their dignity stolen and their kids losing respect for their parents. The middle class thinks that beating up some little country is a great idea, but the cost just make them poorer and some of their kids get killed in the process. These are outcomes of dishonest money at work.
“Every voter who uses their vote to try to advantage themselves at the expense of the other guy instead of using it for what they believe is the best for the country is just an asshole with the right to vote. The people have lost sight of the integrity they once demanded of their leaders. As a result, we have slimy political pricks but no leaders. When change comes, integrity will return. That’ll be after the monetary situation gets straightened out.”
“But how will people know their currency isn’t real money?” Bob’s question was as much a probe about when as it was about how.
“It sort of happens slowly, and then suddenly. Right now, a lot of the people think their money is backed by gold or silver. That illusion is perpetuated by phony gold and silver trading and inventory reports. The exchange covers its ass by saying in disclaimers that they get their data from warehouse operators but they can’t vouch for the veracity of the data. So what you have is reports that count warehouse receipts as ounces of physical products in possession that haven’t been delivered yet. Two warehouses can each claim they own the same ounce. Foreign nations will sniff it out first. They’ll want actual physical metal, and they won’t want dollars or paper contracts that promise them they have some metal secretly stored someplace. The bankers try to play the old ‘Guess which walnut shell the pea is hiding under’ county fair game with their allocated bullion accounts. Country by country, people and institutions will wake up and demand physical possession of actual metal.”
“What makes the public wake up?”
“Could be a metal warehouse can’t stop a delivery notice because they have no metal, or people hear it through the grapevine. Maybe they have a friend in Europe or China who explains that their money isn’t backed by anything. Then they wake up and start asking questions. Another way of finding out is some guy’s wife complains that meat costs more, and that the price continues to rise. Maybe he tunes her out because all women can get bitchy and he knows that, but then he goes to pick up his favorite six-pack for the NFL game on TV Sunday and he notices that the price went up twenty-five or thirty percent from the week before. He goes to the checkout register and asks the clerk if there’s a mistake. The clerk says no mistake and his manager is standing there nodding. Now the guy suddenly remembers what his wife was bitching about and he gets a cold chill. He realizes for the first time he’s not making enough to keep up with the increases in cost of living.
“His most important costs—beer, gas, and dog food—are way up. He gets this terrible fear that his wife is right about this money stuff and suddenly the lightbulb goes off in his brain. He’s getting screwed! Medical costs, food, insurance, clothes, movie tickets, sports tickets, even the cost of feeding his beloved dog are out of control. He panics. He gets home and asks the wife how much money they have. She tells him, ‘Not much!’
“He sees he can’t get much interest on their measly five thousand bucks, so the banks can’t help him. He calls his union
boss, wondering when his next pay raise will be. No luck there. Then he remembers from somewhere in the deepest recesses of his cranium that his grandfather once gave him a few silver dollars and told him to hang onto them because the government couldn’t print them like they can print paper dollars when they want to have a war or when they want to give freshly printed money away to people who never want to work. His granddad told him those silver dollars had to go up, and by God, go up they did! Gramps was right! Gramps never could get his prostate to work, he walked with a limp, and he couldn’t see well, but the old buzzard understood what money was. The old buzzard saved their ass for a few months, but then what?
“Now our guy reads about money and how the Fed screwed him. He sees stuff on TV about buying gold and silver coins. He’s ready to learn. What he learns makes him angry. He’s ready for monetary change. When he puts in a day’s work, busting his ass, he wants the money he makes to hold its value, like the real money Granddad gave him.
“That’s how it begins, one guy at a time. After a few guys get it, they tell others and the word spreads like wildfire. Men get off their couches at halftime and cry out, ‘The dollars the U.S. Government is pushing on us aren’t good enough to buy my dog his fucking dog food! I’m getting rid of dollars and buying gold and silver!’ There’s a collective rallying cry of an indebted nation and a screwed population. It happens like that.”
When The Butterflies Come Page 6
