Monday, March 8, 2010

What's Fundamentally Wrong With Banking Today

What is fundamentally wrong is that bankers are the ones allowed to create capital in the fractional reserve system AND directly profit, without any reservation, from that capital creation. Money creation by private, unelected, unsupervised, intrinsically biased and interested bankers is a REGALIAN function. For millennia that regalian function was exerted by the rex, the king, namely the state.

Money creation is NOT intrinsic to banking: originally banking did not have that regalian function, and just loaned money which was deposited in banks, one on one.


So what we have in front of our eyes is a worldwide CIVILIZATIONAL REGRESSION. (By the way, to claim that some countries escaped the crisis is a bit silly, because it may simply be that the crisis is better hidden there, or, thanks to derivatives, was exported somewhere else (in Canada the Whistler resort is bankrupt, maybe a symptom of something bigger).)


The crisis has reinforced bankers as rulers. Even France is having severe problems with the increased arrogance of powerful bankers: major profitable French companies could not get loans recently for specific obviously profitable projects. They complained to the presidency, which convoked the bankers. But BNP, the giant French bank, thanks to derivatives, and the like, made nearly 6 billion euros profit in 2009: hard to argue with such success in a system where bankers are kings to start with: who is going to reduce the size of their crowns? (Disclosure: I bank at BNP and has known some top executive there.)

The problem is not just to resist powerful bankers, or protecting financial consumers (after all many of the later profited from the crisis, and are now living rent free in their ill gotten properties, and the bankers are the first consumers of their own banks!). The problem is HOW to PUT BANKING UNDER DEMOCRATIC SUPERVISION.

As Baron Nathan Rothschild (yes, from the Rothschild family) put it: "I care not what puppet is placed on the throne of England to rule the Empire, …The man that controls Britain’s money supply controls the British Empire. And I control the money supply."

In the USA, the Federal Reserve Bank is independent of democracy. It depends only upon bankers. Jamie Dimon, head of JP Morgan Chase, for example, sits on the board of the New York Fed. Obama probably dreams every day of having this good friend who impresses him so much, Secretary of the Treasury: after all, Rubin, Clinton's first Sec of Treasure served at Goldman Sachs for 26 years prior.

Economy Nobel Laureate Stiglitz recently called the (financial) system in the USA "corrupt". Because of the size and leadership of the USA, it's the entire civilization which is now "corrupt". Time to review the basics, and it's not just about making consumerism of a few wiser. it's time to all get wiser, and more moral.

PA

http://patriceayme.wordpress.com/2010/02/20/greed-cant-lead/

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