The World Financial Condition Is a House of Cards
By James Donahue
It is no secret that stock exchanges around the world are reflecting a very unstable
financial climate. The reasons for this appear to hinge on the housing crisis that began in the United States earlier this
year and has been intensifying ever since. Money analysts are busy pontificating on our television screens about whether the
Bush Administration’s multi-billion dollar “bailout” will stop the bleeding while trying to assure the public
that all is well.
Yet there is a general feeling among the people that all is not well. This financial
mess couldn’t have happened at a worse time . . . just weeks before the tenure of the nation’s most inept president
grinds to an end and a new administration takes over . . . and just as the Christmas shopping season is kicking off. At the
opening bell of what has traditionally been the biggest shopping day of the year, the Friday after Thanksgiving, shoppers
were out but cautiously hanging onto their purse strings.
Indeed, we heard one economist bluntly
advise Americans to forego shopping for gifts this year if it means buying on plastic credit cards because this is not a time
for folks to be plunging deeper into debt.
That is how serious this recession
is being felt all over the nation . . . all over the world. It is a chain-reaction kind of situation where people are losing
their trust in the dollar, banks have stopped lending, businesses that can’t borrow are laying off employees, people
out of work are losing their homes and standing in line for food stamps, and thus causing more businesses to close.
The old propaganda techniques to assure
people that everything is just fine can’t stay ahead of this mess. People who don’t have jobs and have had their
homes foreclosed on are not home watching their televisions, so they are not being spoon-fed the sense of security the talking
heads dish out so well. And nobody is believing the newspaper and Internet stories on the major news outlets that Christmas
shoppers are spending bigger than ever.
People aren't being fooled this time.
Something dark is in the wind and we are thinking it may be time to batten down the hatches.
that the ball has started to fall, job insecurity is feeding upon itself. Who wants to go deep in debt on a new house, or
even take on a small debt for a new kitchen appliance if we can't be sure we will have a steady paycheck in the months to
come? And the more unemployed people there are, the more the dilemma intensifies. How can a laid-off Chrysler worker buy a
new car if he doesn't have a job and can't even qualify for credit?
And with all three major automakers
in the United States pleading for financial help from the government just to stay solvent, how does anybody think they can
sell cars to a frightened nation?
It seems as if our economic system is crumbling before our eyes. But how
could this be happening after so many years of steady growth and prosperity? Can we blame the Bush Administration for this?
Not only this administration, but we can blame the Clinton Administration and the Reagan Administration before that. It has
taken years for the deregulated markets, created by Allen Greenspan and the Reagan financial team, to push the system this
far out of whack. The freedom awarded to the big bankers, mortgage lenders and fat cats on Wall Street was grossly misused
because nobody was stopping them from dipping too deeply into the till. They are jumping out with great personal wealth at
the expense of everybody else. Now some fear that we are seeing the end of capitalism as we once knew it.
problem is that we have destroyed the foundations of our monetary system. The capitalistic system was a good idea when it
all began. The idea was to keep money in constant circulation so everybody could benefit by working for wages and buying products
and services produced by workers. Money was never supposed to be horded in large amounts by a limited few who discovered ways
to gain control of it.
There also was a time when the United
States backed all of its money up by either a quantity of gold or silver, stored in reserve. While we still store a large
amount of gold at Fort Knox, Kentucky, Americans can no longer trade their paper money in exchange for gold. We have quit
the gold standard and to keep up with world demands, borrowed additional money from other nations including China and Saudi
Arabia. Finance has become a very complicated business since the days when we believed a dollar was as solid as the gold at
Some people wonder if
there is any gold left there at all.
Coins in those days were minted in real gold and silver. People could carry these
precious metals around in their pockets as assurance that our monetary system was intact. This way of doing things probably
has had a lot to do with the stability of the American dollar on the world financial market for so many years.
however, the U.S. bankers and money brokers discovered that people would still trust their printed paper money, even after
it was no longer backed up by precious metals. The government created the Federal Reserve, which promised to back up the money
everybody kept in banks, up to a certain amount.
The latest scandal has been the invention
of plastic credit cards, which quickly got misconstrued as a form of money. We have been operating on a plastic and paper
monetary standard now for at least 50 years. And now with the advent of computers and Internet banking, more and more money
transactions are being made electronically, not only from store to bank and bank to bank, but also from homes to stores and
homes to banks. It is now possible to work, earn and spend money and receive goods and services without ever seeing or touching
a dollar bill.
What this means is that the value of the dollar bill is no better than the people's faith in it's ability
to purchase goods and services. Once that faith begins to slip, and people understand just how flimsy the monetary system
really is, the whole thing is capable of collapsing like a house of cards.
This appears to be what is happening today.
We think this may, in the long run, be a good thing for everybody concerned. While the adjustment could be harsh, slipping
out of the old capitalistic system and grasping our way back into other means of operating, like the old barter system
for example, and eventually moving into a world-wide socialistic system of sharing so that everybody enjoys a form of equality,
might just be a wonderful change.
Money, like a lot of other things we worship, is an illusion. All a dollar bill can
be is a fancy printed piece of paper issued by the government. As long as people believe it has value, then we can trade it
for goods and services. After we lose faith in its value, we might as well use it for compost.
As the ranks of the
poverty stricken grow, more and more people understand just how corrupt our monetary system has been. The middle class is
almost completely erased. And the split between those who have wealth and those who have nothing is growing wider and wider.
The number of homeless and poverty stricken people in the world, and even in the United States, is probably staggering, if
anyone has bothered, or found a way to keep tabs..
We have lived for too long in a world of invented fantasy, designed
to keep us pacified. Under the influence of our daily dose of Prozac, we sat in our modest little dwellings, deep in debt,
watching carefully orchestrated television game shows that turn ordinary people into instant millionaires. Some of are still
in that world. We play the lottery. We watch sports figures sign contracts that earn them multi-millions of dollars. We hear
stories about political figures, from local levels all the way to the White House, who take big "payoffs" for political favors.
The American dream has shifted from having a steady job, owning our own home and parking a car in the garage, to rising up
from poverty like Cinderella. But for most of us, that is all it can ever be. It is only a dream. It is not reality.
is changing. The crash, if and when it comes, will be like a breath of spring air. It will bring an end to all of the scalping,
cheating and downright robbery that has become our way of life. Our legislators have passed laws making it mandatory that
we pay local, state and federal taxes on every dollar earned, spent, and on all things of value that we own. We are required
to pay for high priced "no-fault" automobile insurance. We are bombarded by a daily advertising blitz, designed to make us
want poorly manufactured plastic devices we don't need. Yet the jobs we have available, if we can land one of them, fail to
pay enough to maintain the standard of living we are programmed to desire. We have become unwitting slaves to a corrupt system
that is attempting to shake every last penny out of our already empty pockets. We can't even die without someone paying a
high price to dispose of our remains.
Money has become the real god of the people. People seem to be willing to do
anything, even kill to get it.
The collapse of such an evil deity would be a very good thing for everybody concerned.