An excellent article by Michel Chossudovsky, giving some understanding of this ‘crisis’ and its implications. At globalresearch.ca.
The Most Serious Financial Crisis since the 1929 Wall Street Crash
When viewed in a global context, taking into account the instability generated by speculative trade, the implications of this crisis are far-reaching.
The crisis, however, has by no means reached its climax. It could potentially disrupt the very foundations of the international monetary system. The repercussions on people’s lives in America and around the world are dramatic.
The crisis is not limited to the meltdown of financial markets, the real economy at the national and international levels, its institutions, its productive structures are also in jeopardy.
As stock values collapse, lifelong household savings are eroded, not to mention pension funds.
The financial meltdown inevitably backlashes on consumer markets, the housing market, and more broadly on the process of investment in the production of goods and services.
War and the Economic Crisis
What is of utmost significance is that this plunge in stock market values occurs at the crossroads of a major military adventure. The global financial crisis is intimately related to the war.
A spiraling defense budget backlashes on the civilian sectors of economic activity. The war economy has a direct bearing on fiscal and monetary policy. Defense expenditure is in excess of $500 billion. A separate $70 billion is earmarked “to cover war costs into the early months of a new administration. Those amounts combined would represent the highest level of military spending since the end of World War II (adjusted for inflation).” (Csmonitor.com February 06, 2008).
“War is Good for Business“: The powerful financial groups which routinely manipulate stock markets, currency and commodity markets, are also promoting the continuation and escalation of the Middle East war. The financial crisis is related to the structure of US public investment in the war economy versus the funding, through tax dollars, of civilian social programs. “More broadly, this also raises the issue of the role of the US Treasury and the US monetary system, in relentlessly financing the military industrial complex and the Middle East war at the expense of most sectors of civilian economic activity.” (See Michel Chossudovsky, The Democrats endorse the “Global War on Terrorism”: Obama “goes after” Osama, Global Research, August 29, 2008)
The war is profit driven, financed through the massive Worldwide expansion of dollar denominated debt. War and Globalization go hand in hand. Wall Street, the oil companies and the defense contractors have concurrent and overlapping interests. The oil companies are behind the speculative surge in crude oil prices on the London energy market.
In turn, resulting from the military agenda, the US civilian economy is in crisis as the nation’s resources including tax dollars are diverted into funding a multibillion Middle East war.
Any sensible government would shut down the US bases and withdraw from Iraq and Afghanistan, to start concentrating instead on helping its citizens create a new local economy. But, as we know, the US govt is totally controlled by the military-industrial complex, and totally committed to a war economy, supporting their friends and wasting resources in pursuit of global domination. As said in last article – its a strange world!
Financial Warfare: The Powers of Deception
The weapons used on Wall Street are prior knowledge and inside information, the ability to manipulate with the capacity to predict results, the spreading of misleading or false information on economic occurrences and market trends. These various procedures are best described as the “powers of deception“, which financial institutions routinely use to mislead investors.
The art of deception is also directed against their banking competitors, who are betting in the derivatives and futures markets, in stocks, currencies and commodities.
Those who have access to privileged information (political, intelligence, military, scientific, etc.) will invariably have the upper hand in the conduct of these highly leveraged speculative transactions, which are the source of tremendous financial gains. The CIA has its own financial institutions on Wall Street.
In turn the corridors of private banking and offshore banking, enable financial institutions to transfer their profits at ease, from one location to another. This procedure is also used as a safety net which protects the interests of key financial actors including CEOs, major shareholders, etc of troubled financial institutions. Large amounts of money can be moved out at an opportune moment, prior to the company’s demise on the stock market. (e.g. Lehman, Merrill Lynch and AIG).
The Federal Reserve Bank of New York and its powerful stakeholders have “inside information” on the conduct of US monetary policy. They are thereby in a position to predict outcomes and hedge their bets in highly leveraged operations on the futures and derivatives markets. They are in an obvious conflict of interest because their prior knowledge of particular decisions by the Federal Reserve Board enables them as private banking institutions to make multibillion dollar profits.
Links to US intelligence, to the CIA, Homeland Security, to the Pentagon are crucial in the conduct of speculative trade, since it allows the speculators to predict events, through prior knowledge of foreign policy and/or national security decisions which directly affect financial markets. An example: the put options on airline stocks in the days preceding the 9/11 attacks.
An internal war within the financial system is unfolding.
Lehman Bros goes bankrupt, Merrill Lynch is bought up…
Mortgage giants Fannie Mae and Freddie Mac are taken over by the government.
Bear Stearns collapses, America’s largest insurance company AIG’s share collapse from $22.19 on September 9, to less than $4.00 at the close of trading on September 16, a decline of more than 80 percent of its value.
Goldman Sachs together with JP Morgan Chase are negotiating with the Treasury to arrange for a $85 billion secured loan to AIG, which would be financed by the Federal Reserve Bank of New York.
Who picks up the pieces? What lies ahead?
The process of mergers and acquisitions is likely to proceed to new heights leading to an unprecedented centralization of financial power, with Bank of America, JP Morgan Chase and the Federal Reserve Bank of New York playing a dominant role.
The meltdown will be conducive to the demise of numerous banking and financial institutions, which will either be driven out of the financial landscape altogether or acquired by the financial giants.
Bank of America is slated to purchase Merrill Lynch, leading to the formation of the world’s largest financial institution, clashing with Citigroup and JP Morgan Chase. It should be noted that while Citigroup and JP Morgan Chase are competing institutions, they are nonetheless entwined through intermarriage between the Rockefeller and Stillman families.
Bank of America in the last two decades has developed into a financial giant through a series of mergers and acquisitions. In 2004, Bank of America acquired FleetBoston Financial, in 2005 it purchases credit card giant MBNA and in 2007 it acquires LaSalle Bank Corporation and Corporate Finance from the Dutch bank ABN AMRO. And on September 14, 2008, Bank of America announced its intention to acquire Merrill Lynch for $50 billion.
What we are dealing with is a clash between a handful of major financial institutions, which have developed through mergers and acquisitions into Worldwide financial giants.
The financial meltdown on Wall Street largely benefits Bank of America and JP Morgan Chase, which is part of the Rockefeller empire, at the expense of Lehman Brothers, Merrill Lynch, Goldman Sachs and Morgan Stanley. Lehman Brothers filed for Chapter 11 bankruptcy on Bloody Monday, September 15. Lehman’s assets are of the order of $639 billion.
Potential Losers
Citigroup Inc., declined 15 percent to $15.24 for the steepest drop since July 2002. [Sept 15]
American Express Co., the biggest U.S. credit card company by purchases, fell 8.9 percent to $35.48. [Sept 15]
Goldman Sachs fell 12 percent, the most since April 2000, to $135.50. The decline was the result of short selling.[Sept 15]
Morgan Stanley, the biggest U.S. securities firm other than Goldman Sachs, fell 14 percent to $32.19.” The decline was the result of short selling. [Sept 15]
(See Bloomberg, Sept 16, 2008)
In 2000, J.P. Morgan merged with Chase Manhattan, leading to the integration of J.P. Morgan, Chase, Chemical and Manufacturers Hanover into a single financial entity. Bear Stearns was acquired in 2008 by JP Morgan Chase following its collapse. This banking empire controlled by the Rockefeller family has assets of more than 1.6 trillion dollars.
With assets of $1.7 trillion, Citigroup’s future remains undecided. It is facing serious financial difficulties which could lead it into bankruptcy. Citigroup share prices have in recent months collapsed alongside those of Fannie Mae. The Lehman debacle has precipitated a further decline of Citigroup stock prices.
It is the trustee “for unsecured creditors who are owed some $155 billion by Lehman Brothers”, but according to Citgroup statements they “have little or no exposure to the failed investment bank.”
What this means is that the collapse of Lehman will lead to massive loan default in relation to the portfolios of Citigroup and NY Mellon clients, namely client banking institutions as well as individual investors.
This does read as though the ‘crisis’ is deliberate – as a friend of ours recently said – a deliberate attempt by some big players to acquire other big players. The whole world is perhaps feeling the effects of economic warfare between the elites of America?
Few of us can pretend to really understand what is going on, but in simple terms, this ‘crisis’ coupled with peak oil & climate change is going to alter reality for billions of people. If you aren’t preparing yet to secure your basic needs and strengthen your local communities, why on earth not?
