One of the interesting notions that are making its round once again is that during The Great Depression the Federal Reserve was not able to inflate during the crisis because prices were simply deflating much more rapid than the FED could counteract. While that is true to a degree during that period we must remember that there have been some very drastic transformations during the last 40 years in both the institutional and monetary framework of the Central Banking process, perhaps the most striking one is that during the 1930s, the monetary system was still on a gold-backed, partially fiat system, today that is no longer the case. Remember, money back by gold poses a very restrictive and narrow means of operation for any Central Bank, that's the main reason so many Central Planners hate gold.
The FED has long been freed from the restrains that gold money placed upon it, especially the restrains it confronted during the deflationary Great Depression. It was restrained from inflating during that period because of the fundamental foundation of the monetary system of that period. There are no longer any such restrains that limit the ability of the FED to inflate to combat any deflationary pressure it sees in the economy. While I understand that those who see a deflationary depression on the horizon are coming from, the claim that because there has been excessive credit creation and therefore excessive debt, including massive defaults in the economy that the FED has reached a point in which they have effectively lost control over the money supply and that deflation is increasing faster than the FED so that it can now only “push the string” can inflate is erroneous. While it appears that there is indeed areas within the economy that will suffer from deflation, the response will be an unrestrained push by the FED to inflate on a massive scale, one that we are already beginning to witness.
Even if the banks cannot stimulate new loans, and therefore new bank-money [money created through the fractional reserve system], the FED, as we are beginning to see, will directly infuse and inflate liquidity into the system and take up the slack within the commercial and investment banking systems, side-stepping, as it were, the fractional reserve system of banking for a direct system of monetary inflation. Even many of the actions taken recently by the FED, the Treasury and the Central Banks of the world are all inflationary to the extreme; even the rise of the FDIC insurance limits on accounts is an inflationary measure that will eventually work its way into the general economy.
For decades the American Public has been told and reassured that the U.S. Banking System is safe, that the “Full Faith of the Government of the United States” backed not only the obligations of the government itself, but also insured depositors against overwhelming loss. The American People are already being rudely awakened, the scales are falling off of their eyes, or I should say that the scales are being ripped off of their eyes en-masse about the actual risk associated with this fraudulent fractional banking and fiat monetary system. They don't understand it fully yet, but the faade is being ripped away by circumstances.
The continuation of bank failures will, if not stemmed by the FED, prove to be massively deflationary, but there is simply no way that the FED will allow an escalation of bank failure without first stepping in with yet another massive influx of Fiat Liquidity. The bailouts are far from over folks, and with those massive bailouts come massive and un-hindered inflation of the money supply. The problem is that by that time the confidence of the People in this phony system will have been cleansed away and will not easily be restored.
Perhaps few have realized it, but there has actually been a global permanent monetary crisis for decades, a balancing act on the edge of a razor blade between deflation and inflation, stability and instability. It is a system that has an inherent flaw within its very nature and we are forced by those playing this balancing act to endure this system of fluctuating rates that are simply used to manipulate wealth creation for those who are already wealthy, to increase the power of those politicians and central bankers who already have power. It is evident that those in our government are woefully ignorant of just what has been happening, what is happening and what will happen to this monetary system and the resulting economic and social disaster that will eventually express itself in the collapse of the entire global monetary system. We are however, on the very edge of a fundamental shift, one that can only have an eye-opening outcome. This shell-game that has been played, whether by actual intent or pure ignorance, is coming to an end.
John Maynard Keynes, the father of our Fiat Monetary System, pressed for an international paper unit that would fluctuate through an independent fiat monetary system around the world, well folks that is exactly what was implemented in 1971 when this country finally cut all ties between the currency and gold. You see, we have been operating under a global currency since 1971, you don't have to wait for one to come, it has been here and it is called Total Fiat Money. While there was some talk by both the Fabian Socialist Keynes and the Communist Dexter White to use a unified paper currency called the “bancor” or the “unita”, it was concluded that the same thing could be achieved much easier is every country retained their “own” currency as long as each currency was Total Fiat so they could basically pyramid the expansion of the national currencies in at system that allowed total control over the economy and the global societies. So, we have a world currency whether we know it or recognize it or not and have had one for at least the last 37 years.
In this way, the Central Banks of the world could inflate together, create a massive Feudal System of Peonage on a global scale and maintain both political and social controls over the various populations of the world without very much restrain or limitations. The problem, of course, is that they appear to actually believe in the system that they created for these purposes. It appears that they believe so much that they don't realize that the system they have placed so much of their faith and future into is one that is inherently flawed and will self-terminate. Fortunately, even with the global monetary system they created, they have not been able to wipe away the identity of individual countries, nor will they ever be able to do so, it is simply too strong within the hearts of people around the world. If anything, we are seeing a move for more independence within various peoples of the world, not less. The banking and political powers of the earth are now so tied into a system that is not only unstable, but is rapidly becoming an incoherent mess in their hands.
The New World Order is falling apart before their eyes. I realize that there are some who don't believe that, who believe that this panic is just another in a long list of strategies in the magic NWO tool box in order to impose their will on this country and the world, but I see something very different happening. For decades they have used massive resources and worked extremely hard to impose this system on the world and while they have had definite successes in implementing their global system, they have also had failures and will have many more, so many in fact that they will be forced to surrender their plans for their Socialist Utopian Society. They were successful in the implementation of a global currency system, even with different currencies, they have raped the land and the People, they have herded the population into neat, controllable groups for convenience, taxed and regulated to maintain their political controls, but it is all coming to a very rapid and very destructive end.
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