The Wolfson Prize, I win!
A Lord Wolfson has just created a one off prize for the best proposal to manage the exit of the euro.
This morning I submitted my, no doubt winning, contribution:
Dear Lord Wolfson,
Many thanks for your invite to devise a clear cut plan to manage the transition of the post euro financial system. Most timely, and most needed.
Of course the dollar is toast also, but rest assured: the simple measures proposed below will take care of that problem also.
I was rather surprised to see you looking at the academic world for answers. Not only were these honorable professors deeply involved in the development of the euro, they also seemed very surprised by the advent of the credit crunch. They also seem to express continuing shock at the rather dismal figures the global economy has been producing the last three years.
In my experience academics are good for one thing: producing illegible, irrelevant, expensive and massive papers. To be honest, I would not rely too much on them, they are as clueless and obsolete as bankers and politicians are.
Now, about the 250.000: you keep that, you probably need it more than I do. It’s more important that things get fixed.
Thanks much and all the best with your efforts!
Anthony Migchels
the Netherlands
In order to have an orderly post euro (and post dollar) transition, we propose these measures.
1. All banks will be nationalized. They needed more than 20 trillion dollars in handouts and easy credit from Central Banks and Governments and are still all under water. Shareholders will not be reimbursed, their property is worthless.
A full investigation into the activities of these banks is ordered. Senior staff and management will be prosecuted where necessary.
2. All interest payments by and to these banks will be frozen. Since banks create the money they lend out through fractional reserve banking, they don’t need interest payments. An average mortgage of 200.000 costs up to 300.000 in interest payments during the thirty years the loan is payed off. If this money represents the ‘costs’ of the bank for providing the loan, these organizations must be among the most inefficient known to man.
3. All financial products, including derivatives, will be frozen. Within a year there will be a final decision on what to do with them, but a minimum of 95% of them will be canceled. There will be no reimbursements. Where necessary speculators will be burnt.
4. All real debts, mortgages, business loans, personal credit, the national debt, will be maintained and repayment according to contract, but excluding interest, is ordered in full. The real costs of managing these debts will be passed on to the debtor. Odious debts will be forgiven.
5. All Central Banks will be closed. Where necessary, their operations will be taken over by independent commissions and within a year they will be terminated.
6. All income tax will be abolished. The State will finance itself by taxing wealth and consumption of non essential goods and services.
7. All Banking families will immediately give full disclosure on their asset positions and records. Their activities will be investigated and when necessary they will be prosecuted. All their assets will be disowned.
All these assets will be centralized in a Trust, in which every citizen of the world has one share and one vote. These shares will not be tradable for the first year. We will provide all with the means and information necessary to exercise the rights associated with this share and vote. Within a year a number of scenarios for the liquidation of this trust will be proposed. A referendum will take place to decide which plan is best.
8. A legal framework for a free market of currencies is ordered within a year. This framework will be concise but will make clear that:
a. Governments will accept payment of taxes in these currencies when there turnover is sufficient for Government to spend the income of taxes in a useful manner.
b. Manipulation of these currencies, either by insiders or outsiders will be severely punished.
c. All currencies will be given free access, metal- or credit based or debt free. For Profit, or not for profit.
d. The prohibition of fractional reserve banking, to avoid insolvency of credit facilities. Credit will be created on a mutual credit basis.
The economy needs a free market for currencies, so that the most efficient will thrive.
9. A full investigation into the manipulation of the gold market is ordered. The culprits will be punished, fines will exceed the profits obtained with these frauds.
10. We the people take responsibility for having allowed this financial system to happen. The useful idiots within the system will therefore be treated with leniency, if they cooperate in the full disclosure of these operations.
11. A concise but comprehensive education program on the fundamentals of money will provided to all. We will again never allow ignorance to be exploited again.
12. All destruction of evidence as of now will be severely punished.
With these measures we will achieve the following:
– An immediate end of the wealth transfer from the many to the few through interest.
– An immediate end to poverty all over the world.
– A massive decentralization of economic power to the peoples of the world.
– An immediate end to the depression.
– An immediate end to the most destabilizing and warmongering class: the plutocracy.
– A solid and stable financial system, costing no more than 1% of GDP, providing the economy with the liquidity it needs.
Trackbacks & Pingbacks
- The Battle for Europe: will the People or the Euro survive? « Realcurrencies's Blog
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- Sopravviverà l’Eurozona? | 1LLUMINATI.COM
- Sopravviverà l’Eurozona? | STAMPA LIBERA
- DIETRO LA CRISI DELL’EURO E LA GRECIA, IL PROGETTO DELLA MONETA E GOVERNO MONDIALI | Tutto Ciò Che Si Immagina è Reale……..
- Sopravviverà l’Eurozona? | Informare per Resistere
- The Inflation vs. Deflation Dialectic « Real Currencies
- Financial Warfare 2012: Boycott all Banks « Real Currencies
- The Ron Paul Challenge: 10 reasons why the Alternative Media is failing this test « Real Currencies
- Debt Repudiation or an Interest Strike? « Real Currencies
- Meanwhile, at the Daily Bell……they may have a point about Ms. Brown and OWS « Real Currencies
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- The Manufactured “Debt” Crisis « NESARA AUSTRALIA
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Nice ideas. I wish it could actually happen my friend. But these evil rich men will not willingly step down. They will drag the world into the most brutal war imaginable in order to retain their power. And if they cannot rule then no one will, they will kill themselves and take the rest of us with them.
God bless.
I know John, but they will keep comin’, so we’ll just have to pound them at some point.
If not I, who? If not now, when?
Right on Anthony, that’s what I like to hear! Never give up and stand when it’s time to stand. I agree, we need to continue to wake people up to the evil cabal that has enslaved humanity. They are already trying to destroy the Internet because it’s the best weapon we have in the struggle for true freedom.
My statement was meant to inform people of the hard road ahead of us. I’m not a defeatist. These people will not just relinquish their strangle hold on the human race, we’re going to have to fight for our freedom.
In a word yes. In two words, hell yes. But here’s a new thought. It is absolutely inevitable that elites will fail. We don’t need to fight – at all. If you live by the sword, you will die by it. We need only do two things to prevail and neither will hurt us:
1 – Bear witness boldly to what is really going on – i.e. illuminate others
2 – Stop participating. Close your bank accounts with all but credit unions. Go back to the land and exit the system as much as possible. If you are in law enforcement or the military, do nothing against the innocent (i.e. Oathkeepers principles) Help others to the greatest extent you can (it will come back to you by the inevitable law of love) Don’t vote for Demublicans. If the candidate doesn’t stand for economic democracy, spoil your ballot with “none of the above” as a visible protest. Better yet – be the change you want to see by offering yourself as a candidate for change.
A top will topple if you give it no momentum. This is what scares the shit out of elites.
To have money in a credit union, there has to be a promissory obligation for it at that credit union or another bank. Credit union = bank.
True but the point is to dethrone the big banks and credit unions presumably operate for the benefit of their customers – not shareholders. It is the lesser of two evils that helps hurt them. I could propose that people close their accounts altogether but that is impractical in this day and age. As a basic point, how would people cash their pay cheques? Would they send cash in the pail to creditors to settle bills?
If you want to kill the bank, everyone with checking, savings, physical bills/coin would have to find someone who “owes” the bank and give them the money to extinguish the debt, but then there would be no money. I’m proposing a public bookkeeper issue money directly to people so they can deposit it at a private brokerage who would handle checking/electronic transfers. From there you would have to save in checking for all your purchases. You could also find investors for pooling resources by the facilitating of stock to form a company to work at.
People could keep an account for monthly payments that can not be done without a bank account. But the idea that we need banks is basically nonsense. The money is not safe there. It is used for quite nefarious purposes beyond our control.
Forty years ago nobody had a bank account.
Of course, a rational, non usurious system would allow digital processing of payments for efficiency purposes, that’s not the problem. It would also not abuse the power of logging transactions and making people dependent on the system, like the current vampires do.
I agree with all this. I am only adressing the process of getting from where we are to where we want to be. You will find very few people who can actually get by without some kind of bank account. Given that as a starting point, what kind of account do you suggest that is better than a credit union AND that I can open right now?
I believe there are already brokerages that will handle checking, but you have to have a minimum invested through them. I say we have to use the system, but devote your life to destroying it, which turns out to be bringing people to God. That’s my take anyway. And yes, there are many details that need to be worked out before the transition to post-bank to eliminate pandemonium.
I agree with this. They’re not quite the scourge commercial banking is, but they are still part of a morally busted system.
James 5:1-8 KJV
1 Go to now, YE RICH MEN, weep and howl for your miseries that shall come upon you.
2 Your riches are corrupted, and your garments are motheaten.
3 Your gold and silver is cankered; and the rust of them shall be a witness against you, and shall eat your flesh as it were fire. Ye have heaped treasure together FOR THE LAST DAYS.
4 Behold, the hire of the labourers who have reaped down your fields, which is of you KEPT BACK BY FRAUD, crieth: and the cries of them which have reaped are entered into the ears of the Lord of sabaoth.
5 Ye have lived in PLEASURE on the earth, and been wanton; ye have nourished your hearts, as in a day of slaughter.
6 Ye have CONDEMNED AND KILLED THE JUST; and he doth not resist you.
7 Be patient therefore, brethren, unto the coming of the Lord. Behold, the husbandman waiteth for the precious fruit of the earth, and hath long patience for it, until he receive the early and latter rain.
8 Be ye also patient; stablish your hearts: for the coming of the Lord draweth nigh.
You do realize that for a person to have say $4mil to open their own bank, there has to be obligations to pay $4mil by borrowers at other banks right? That can hardly be considered a “fraction” for “reserve”. The bank has no money. They don’t lend anything. It’s a big circle jerk. There is no fraction. They know how to screw with your mind. Once this becomes commonly understood, prosecution will be the last of the bankers concerns. They will have to live in protected exile on a remote island. It will be hard for the lowest level bank teller to ever find employment again because of the stigma associated with banking.
I like the plan from 50,000 feet perspective but as I’m sure you well know, the devil is in the details. I have noticed that though you often hit the nail squarely on the head, you seldem point to the ROOT CAUSE of all this mayhem which is of course, THE GAP. Elites hide knowledge of the gap because they know it will unseat their power source – the artificial shortage of money that they alone control. It is the gap itself, though, that is causing so much hardship. A fixed quantity of money in and of itself is not a problem. It is the systematic removal of it that causes the problem as Frederick Soddy so ably proved. There are two – if not more – viable solutions to the problem; Soddy’s National Economy and Douglas’s Social Credit. The first fixes the hole in the bottom of the glass and then keepos it full. The second ensures that the water is added as fast as it is being drained off. Banksters simply keep it near empty. This metaphor illustrates the problem and its solution perfectly. Everyone looks at the TARP money and cries inflation, but as you correctly pointed out in another article, the M1 is shrinking relative to growth rates. The TARP money is circulating in the CASINO – NOT MAIN STREET. You really need to put some focus on the GAP. This is the very heart of misunderstanding in the minds of most men.
hm..m.
I understand what you’re saying. I realize the SC’ers are very proud of the GAP which is indeed a useful concept. However, to my mind it does to some extent obfuscate the real issue, which is interest. Our mutual friend C.H. Douglas’ famous A+ B theorem basically comes down to cost for capital. To a large extent, at any rate.
I do agree I maybe do not clearly enough express that all the lost interest is destroying purchasing power and thus is keeping the economy in permanently depressed state. Mostly on my mind is the injustice of it all: all the interest ends up with the rich. The poor have to borrow from the rich, after all. But in this article, as in ‘the problem is not debt, it’s interest I explain quite clearly that the extra purchasing power immediately ends the depression when interest is done away with.
In short: The Gap is basically interest. Focusing on purchasing power is just part of the story. The injustice of the wealth distribution is at least equally important, while calling it the GAP also ignores the basic instability (P<P+I) interest on the money supply brings.
By the way: I do like SC, not so much because it compensates for interest (it is better to do away with it), but because it provides a basic income. But that's another story.
PS: I discuss the casino here.
You know the P<P+I paradigm is just diluting the fact that bankers are only loaning paper? Paul Grignon, though I think he does have a lot of fallacious arguments, does a good job of illustrating this. – http://www.youtube.com/watch?v=_2LjbBfh7Ug&feature=channel&list=UL 4:20 I compare it to the "inflation boogeyman", "gold standard", "anti debt money" etc. paradigms. The money supply is unstable because the people in charge of it are unstable.
There is a lot to be said for that (I’ll check Grignon later). Especially when the interest is spent back into circulation the P<P+I does not seem to stand, as at the of the year the interest is payed while the money supply = P.
But if the interest is lent back into circulation, it does imply ever growing cost for capital and ever more money needed to finance the interest payments. This should have deflationary effects.
The idea that the main instability is with the controllers is completely correct and quite relevant.
I appreciate what you are saying but if you think about it carefully, you will realize you are mistaken. Here’s how. Let us presume that as with the present system, you issue a dollar but must repay $3 (i.e. 30 year mortgage at 5%) and the $2 in interest was never issued. This is musical chairs that guarantees bankruptcy – exactly the present order of things. Now let us presume that you issue that $2 as social credit dividend to the purchaser. Now there is no shortage and everyone has a seat when the music stops – AND the bankers have lost their leverage to get what we’ve got! You still have a bank that gets something for nothing but the consumer is legitimately able to service the debt and voila – no bankruptcy.
I share your outrage at the present system and agree that this system needs to go but there is no question that Douglas was technically correct. The system can be made to work with banking remaining intact under social credit and prosperity can be had by all. All that is needed is for enough (not too little and not too much) gap money to meet the B costs of industry – of which interest on loans is one of those costs – and everyone is happy. Except the greedy bankers. They can’t be content with getting a free lunch. They want to be masters over us. This is why they have supressed knowledge of social credit and worked so hard to discredit it. They would loose CONTROL over us. That alone is why they must go IMO.
This does not take away from the essential truth that it is the GAP that must be addressed. Give people enough money to meet interest but NOT enough to cover the other B costs and you have fixed NOTHING. Eliminate banks and offer interest-free money but fail to fill the gap and you have fixed NOTHING. People will still need to borrow to meet the gap and manufacturers will still need to push those unrecovered B costs into the prices of their next round of production. It seems that it is this that you fail to fully comprehend. Thie is not an either/or proposition. This is a TWO FLAWS problem and failure to adress BOTH flaws guarantees FAILURE. Actually and technically, if you addressed the GAP only, that would be sufficient to restore prosperity. The problem is that those elites who benefit from the present system and have opressed mankind for so long would go unpunished and they would be left with such great wealth intact that there is always the danger that in future generations, a trusting and complacent public could be hoodwinked again.
I have modeled all of this with an Excel spreadsheet. That is why I am certain it is correct – that and careful cognitive reasoning. Just ponder it with an open mind and it will come to you too.
I understand Liam. I agree the system would be ‘fixed’ in the sense that built in bankruptcy would be solved. But the free lunch for the bankers is just unacceptable. There is no need for it. It is bad for them too, as it feeds their avarice and lust for power. It finances their on-going quest to regain control of the money supply, would we implement SC.
While I agree interest is probably not the entire GAP, I’m quite certain it is at least 80%. I’d be interested to know what other costs you’d have in mind. So to say it solves nothing is badly overstating another wise worthwhile case.
Your reasoning, while correct, also shows the basic problem with it: by not addressing the system from all sides, including the major and profoundly basic injustice of interest, a workaround is supplied, instead of solving the core of the problem.
Let’s just do away with interest and use SC to provide a basic income and solve the remainder of the GAP that is structural, but necessarily unjust like Usury is.
Again: I’d be interested what other costs SC identifies.
Thanks! Great input.
You said the gap is 80% interest. It’s more like a few percent. You don’t understand the A + B theorem to make such an assertion. Most of production costs are tied up in B costs. The A costs are wages, earnings and dividends – money in peoples’ jeans – and is all that a consumer has available to buy stuff with. All other costs – raw materials, energy, capital equipment, depreciation, transportation, stationary etc. are the B costs. In our highly automated society, as much as 95% of the costs of makinng things are B costs (e.g. computer chips)
Go to http://www.economiccures.com and study the diagram with the swimming pool on the main page and you’ll see what I mean.
I stand on my assertion that eliminating interest won’t even come close to filling the gap so that fixing banking ALONE is useless.
lol, I may not understand the Gap, but you don’t understand interest. About 45% of prices are interest.
I’ll have a look at the link, thanks.
You da man!