The Shadow Money Lenders: The Real Significance of The Fed’s Zero-Interest-Rate Policy (ZIRP)

The Shadow Money Lenders: The Real Significance of The Fed’s Zero-Interest-Rate Policy (ZIRP)
The Battle To Save The Fiat Money System Has Begun

by Matthias Chang

Global Research, December 26, 2008

http://globalresearch.ca/index.php?context=va&aid=11491

INTRODUCTION

The disinformation by the global financial dailies in the last twelve months as to the cause of the global financial tsunami, serve the same purpose as the global mass media when they perpetuated the lies that lulled the people to support the war criminals Bush, Blair and Howard to launch the barbaric war against Iraq and Afghanistan which resulted in the genocide of millions, the mutilation of hundreds of thousands, physically and psychologically, and the devastation of an entire nation.

The wars unleashed thus far, specifically the “War on Terror” were launched to preserve the shadow money-lenders’ political and military power.

This War on Terror is the greatest military sideshow that distracted the American people from the financial rape and plunder of their economy and the destruction of their Constitution.

Since the Summer of 2007, we have witnessed a concerted effort by the world’s central banks and global commercial and investment banks to preserve the shadow money-lenders’ financial power, one that is founded on fraud and structured in every detail as in the infamous Ponzi scheme.

In the last seven years, the Ponzi scheme was globalised by the Shadow Money-Lenders, siphoning hundreds of billions from so-called sophisticated investors and sovereign wealth funds. At its peak, the Ponzi scheme was estimated to be worth over $500 Trillion, with the Credit Default Swap (CDS) portion just under $60 Trillion!

Hidden behind the headlines of the financial destruction that is sweeping across the globe, lies another story – a dark tale of men who orchestrated the crisis and have amassed enormous wealth and power at the expense of the millions who are now unemployed and whose homes have been foreclosed. This select group of men is in absolute control of the unfolding events. Who are they? THE

HIDDEN POWER

The hidden power is almost indestructible because throughout the ages, any attempt to unveil their hidden agenda and to expose the men behind the screen has been labeled “a Conspiracy Theory” and those who risk their wealth and reputation to expose this power are accused of being “Conspiracy Theorists”.

This is notwithstanding the fact that many insiders who were previously seduced by the power and recanted, have written about such men and their global agendas.

Some “do-gooders” who have visited my website have pleaded with me not to make any reference to the hidden power as “I would be condemned as a conspiracy theorist and lose my credibility.” It is these do-gooders who are unconsciously, the allies and propaganda tools of the hidden power. They are the foot soldiers of the Hidden Power and the first to be slaughtered. They never learn and if they persist, must be considered collaborators.

I have made detail references to the hidden power in my books. I shall recap herein what the insiders have been saying for years. For those who are aware of these writings, it would serve them well to revisit these writings again so as to strengthen their resolve to expose the hidden power until total victory.

In essence, the hidden power is the Global Shadow Money-Lenders - the men and women who control and manage the Shadow Money-Lending System. And they also control all political leaders, directly and indirectly in every part of the world, in every country, Malaysia included!

Anyone who denies this is a fool from our perspective but an indispensable ally from the shadow money-lenders’ point of view.

Please consider the following exposé by renowned insiders.

Napoleon Bonaparte

“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.”

Niccolo Machiavelli

“For the great majority of mankind are satisfied with appearances as though they were realities, and are often more influenced by the things that seem than by those that are.”

President James Madison

“History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control of governments by controlling money and its issuance.”

President Abraham Lincoln

“The money power preys upon the nation in times of peace and conspires against it in times of adversity. It is more despotic than monarchy, more insolent than autocracy, more selfish than bureaucracy.”

President James A Garfield

“Whoever controls the volume of money in any country is absolute master of all industry and commerce.”

The Rt. Hon. Reginald McKenna – Chancellor of the Exchequer

“I am afraid that the ordinary citizen will not like to be told that the banks can, and do, create money. The amount of money in existence varies only with the action of the banks in increasing and decreasing deposits and bank purchases. Every loan, overdraft, or bank purchase creates a deposit and every repayment of a loan, overdraft or bank sale destroys a deposit. And they who control the credit of a nation direct the policy of governments, and hold in the hollow of their hands the destiny of the people.”

Sir Josiah Stamp – Bank of England

“Banking was conceived in inequity and was born in sin. The bankers own the earth. Take it away from them, but leave them the power to create deposits, and with the flick of the pen they will create enough deposits to buy it back again. However, take it away from them, and all the great fortunes like mine will disappear and they ought to disappear, for this would be a happier and better world to live in. But, if you wish to remain the slaves of bankers and pay the costs of your own salary, let them continue to create deposits.”

President Woodrow Wilson

“A great Industrial nation is controlled by its system of credit. Our system of credit is concentrated in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the world – no longer a government of free opinion, no longer a government by conviction and vote of majority, but a government by the opinion and duress of small groups of dominant men.

“I am a most unhappy man. I have unwittingly ruined my country.”

(President regretted signing into law the Federal Reserve Act)

Supreme Court Justice Felix Frankfurter

“The real rulers in Washington are invisible and exercise power from behind the scenes.”

Louis T. McFadden, Chairman of Banking & Currency Committee

In 1932:

“The truth is the Federal Reserve Board has usurped the Government of the United States. It controls everything here and it controls all our foreign relations. It makes and breaks government at will …”

In 1933:

“Roosevelt has brought with him from Wall Street James P. Warburg, son of Paul M. Warburg, Organizer and first Chairman of the Board of the Federal Reserve System…”

In 1950:

“This same Warburg had the audacity and arrogance to proclaim before the U.S. Senate: ‘We shall have World Government whether or not we like it. The only question is whether World Government will be achieved by Conquest or Consent’.”

Senator Barry Goldwater

“Most Americans have no real understanding of the operation of the international money-lenders. The accounts of the Federal Reserve System have never been audited. It operates outside the control of Congress and manipulates the credit of the United States.”

Henry Ford

“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”

The above is the truth laid bare before your eyes and which the shadow money-lenders have spent billions over the years for the control of the global mass media, and paid handsomely specially cultivated economists, historians and politicians to disseminate lies, divert attention and to cover up their hidden agenda.

The next quotation will shock most of you and will change your perspective of many global issues. It is written by a courageous Jew to another courageous Jew.

Benjamin H. Friedman

Letter to Dr. David Goldstein dated October 10, 1954

“The history of the world for the past several centuries and current events at home and abroad confirm the existence of such a conspiracy (to destroy Christianity and obtain global power). The world-wide net-work of diabolical conspirators implements this plot against the Christian faith while Christians appear to be sound asleep. The Christian clergy appear to be more ignorant or more indifferent about this conspiracy than other Christians … It seems so sad.”

A HISTORICAL DETOUR

To secure their global agenda, the shadow money-lenders needed a national base to first consolidate their power and to legislate laws that would secure their monopoly to issue money and credit. The target country was England and that is why the first central bank was the Bank of England. Almost all the laws that secured the money-lenders their unbridled economic and political power can be traced back to the legal basis for the establishment of the Bank of England as a central bank and their unfettered right to create “credits”.

The £ was the currency of choice for world conquest and the result was the mighty British Empire, where the sun never sets! It was an empire based on debt. When the £ Ponzi scheme unraveled, Britain outlived its usefulness and the shadow money-lenders relocated to structure another Ponzi scheme.

The next target country was the United States and the vehicle was the Federal Reserve System. It was a long struggle, but the shadow money-lenders finally prevailed. Thereafter, they established the greatest financial empire in history, but they are still short of their ultimate hidden agenda, as arrogantly proclaimed by James P. Warburg – the establishment of a World Government by conquest or by consent!

Today, the shadow money-lenders have achieved unrivalled military power, but in the process they have put at risk the fiat money system. This is because so much money was required to maintain and sustain the military might of the US and its military bases in client states all over the world and the occupation of Germany and Japan since their defeat in 1945.

What is important to understand is that the shadow money-lenders are parasitic in nature and they have to feed on a continuous diet of debts. The financing of military adventures ensures a continuous stream of debts and compound interests. Debts beget more debts!

When the debts reach saturation point, the Ponzi scheme will collapse and hence, the need to revive and or re-establish another Ponzi scheme, failing which the shadow money-lenders’ financial empire cannot be sustained.

BRETTON WOODS (I) – POST WORLD WAR II PONZI SCHEME

At the end of the Second World War, the United States was the indisputable super-power and largest creditor.

The shadow money-lenders created various covers for massive lending such as the Marshall Plan, supposedly to revive the devastated economies of Europe and Asia. Under the cover of the aforesaid altruistic economic plan of post war recovery, was the hidden agenda for the establishment of the US dollar as the one and only supreme currency to replace the £.

The shadow money-lenders had under their control the following sovereign debtors post World War II:

Canada

The countries of the South American Continent

The countries of Europe, west of the then “Iron Curtain”

The countries of the African continent

The countries of the Middle East

The countries of Asia, west of the then “Bamboo Curtain”

Australia and New Zealand

To secure the sovereign debtors’ consent to the use of the dollar as reserve currency, it was agreed that the dollar was redeemable in gold at US$35 per oz of gold.

The shadow money-lenders never had it so good. Then they got greedy.

Like the goldsmiths of yester-years, the shadow money-lenders created more credits than there was gold to sustain the dollar reserve currency. There were also the numerous wars that needed to be financed, principally the Vietnam War and the proxy wars in Africa and Latin America. There was a huge drain in the gold holdings at Fort Knox.

This gave rise to a crisis of confidence in the Bretton Woods (I) dollar system.

To resolve the crisis and to maintain the unrivalled position of the US dollar, the shadow money-lenders devise a brilliant scheme – a variation of Bretton Woods (I)

BRETTON WOODS (II) – PURE FIAT MONEY SYSTEM

The dollar would no longer be redeemable in gold as decreed by President Nixon.

There were two parts to the overall scheme to secure full compliance.

Part 1 was the use of the simple bully tactic. The Cold War was engineered and intensified to create the myth that the Soviet Union would unleash a nuclear war against the “free countries” and therefore there was a need for collective security in which only the United States could provide the necessary defense, as it was the most powerful nation in the world.

The quid pro quo for the protection under the umbrella of the US led collective security was that countries must continue to use the US dollar in all international trades.

Notwithstanding the fact that the client states agreed to the new arrangement, there was still the fear by the shadow money-lenders that sooner or later the debtors will wise up to the fact that they were holding mere toilet papers. Should this happen, the dollar would be dumped as toxic waste and that would spell the end of the shadow money-lending system.

Part 2 was therefore initiated and the man chosen to implement the con-game was none other than Henry Kissinger. He secured an agreement with the corrupt Saudi monarch and lesser tyrants in the region that the oil price would be manipulated to hit the roof and in return for their untold wealth and financial power, all future crude oil trades must be denominated in dollars, and the petro-dollars must be repatriated to the United States, to be invested in dollar assets.

In a warped sense, dollar was now backed by crude oil instead of gold, as without dollars, no nation could purchase crude oil.

The dollar toilet paper over-night regained its stature and value as the global reserve currency.

Yet, and once again the shadow money-lenders got greedy. They came to the insane conclusion that they could create limitless credits (debts) out of thin air and none would be wiser!

By the late eighties, it was apparent to the shadow money-lenders that the demand and use of crude oil would not be able to sustain the level of dollar credits needed to support the debt pyramid.

Plan B, the Yen Carry Trade was put into action – borrowing yen at zero interest rate to invest in dollar assets, bearing higher interest rates. The Japanese could not complain, being a conquered race and still under military occupation, and so for over a decade, they suffered in silence. The dollar as the global reserve currency was saved, but, not for long.

The instability in the Middle East became a major concern. Saddam Hussein had grandeur ideas. He aspired to be the regional power but Desert Storm scuttled his grand designs. Iran having recovered from the devastation of the eight-year war with Iraq, began to assert itself and their growing strength was perceived as a threat to the security interests of the shadow money-lenders and their partners-in-crime, the big oil companies.

A Plan C was needed. The China card had to be played!

THE CHINA FACTOR

Deng Xiaoping in the 1980s announced to the world that China would practice socialism with Chinese characteristics. Being Red was not critical, for the colour of the cat was not important so long as the cat catches mice!

China wanted to modernize and catch up with the West. It had abundant cheap labour and a disciplined workforce. But development was slow and foreign investments were confined to certain regions.

Back home in the US, manufacturing concerns were being clobbered by the Japanese and the Koreans. Industry after industry became less competitive and costs were rising. A solution had to be found.

The shadow money-lenders have their share of worries – How to accelerate the momentum of credit creation in an economy that is slowing down? Less debts mean less compound interests and therefore less profits. Q.E.D.

The shadow money-lenders realized soon enough that if debt-driven consumption is the solution, then there must be a manufacturing base that can produce the massive quantities of goods that would meet the demands for debt.

China loomed large in the overall scheme of things.

The shadow money-lenders entered into an agreement with the Chinese along the lines of the petro-dollar agreement. There will be massive relocation of industries to China, massive investments in plants and equipment to produce goods for the US and European markets in exchange for dollar denominated trade. And more importantly, it was agreed that the dollar trade surplus would be re-invested in dollar assets.

It was an offer that China found hard to refuse. It was the fast track to economic development and the rapid modernisation of China. China agreed and the rest is history!

Debt exploded in the US and in Europe. Consumers were borrowing as never before to purchase the goodies from China. The recycled dollars from China funded the consumer bubble from home ownership to motorcars, electronic goods, toys, clothing etc. China became the world’s factory and her economy surged. Within a decade, China accumulated dollar reserves amounting to $2 Trillion. Other Asian countries jumped on the bandwagon, and accumulated huge dollar reserves. These huge reserves must be invested and the US lured them to the exotic investments created by Nobel Laureates and rocket scientists.

THE DERIVATIVE CASINO

Financial engineering by the shadow money-lenders accelerated further credit creation. The United States led the way. During the past ten years, while income stagnated, consumer spending rose to a record $8.34 trillion fueled by cheap consumer loans – home mortgage, credit-card loans, car loans, holiday loans etc.

The securitization of the growing stream of compound interests from the wide range of consumers’ debts was the natural and logical step in the next round of credit creation for the derivative casino. These debts were sliced and diced into tranches to form CDOs, synthetic CDOs, CLOs, MBS and CDS etc. and marketed worldwide. The demand for securitization was so great that banks and mortgage brokers were even willing to lend to borrowers on the barest of credit information. They were aptly called “Liars’ Loans”!

In 2004, $157 billion CDOs were issued but rocketed to an amazing $557 billion in 2006. And when there were insufficient mortgages to be securitized into CDOs, Wall Street created the “synthetic CDOs” – bonds which have no underlying loans and or security but allegedly have an income stream based on a parallel contract and on contingencies which may or may not result in any interest payments. Investment is risk, stupid! Higher risks, higher payouts!

In the first quarter of 2007, the creation of CDOs surged further, led by Merrill Lynch which sold nearly $29 billion in February and March, sixty per cent more than the preceding two-month period; Goldman Sachs pushed $10 billion in March which more than double the value in February and Citigroup sold $9 billion in March, one third more than the previous month. CDOs were the rave and the ticket to glorious wealth.

The US, specifically Wall Street became the “Mecca of debts”.

The rest of the world jumped on the bandwagon. So much CDOs were packaged and sold so quickly that no one even had the time to determine which and what securities were being securitized in the CDOs. “Just do the trade, just do the trade” was the chorus line for the traders.

The following table says it all – the Sub-Prime Fiasco.