The Roads To War And Economic Collapse

“The day before the Thanksgiving holiday brought three extraordinary news items. One was the report on the Republican presidential campaign debate. One was the Russian President’s statement about his country’s response to Washington’s missile bases surrounding his country. And one was the failure of a German government bond auction….

“Obama had convinced the electorate that he would end the wars, stop the violation of law by the US government, end the regime of illegal torture, close the torture prison of Guantanamo, and attend to the real needs of the American people rather than stuff the pockets of the military/security complex with taxpayers’ money.

Once in office, Obama renewed and extended the Bush/Cheney/neoconservative wars.  He validated the Bush regime’s assaults on the US Constitution. He left Wall Street in charge of US economic policy, he absolved the Bush regime of its crimes, and he assigned to the American people the financial cost necessary to preserve the economic welfare of the mega-rich.”

(I certainly don’t agree that Ron Paul is the best candiate, he subscribes to the “austrian school” where we must all pay through the nose for the gambling addictions and fraudulent money systems of wall street.   I think Kucinich would be an excellent president until he got shot by a lone gunman or killed in a mysterious airline crash)

The Fundamental Problem: Debt-based Currency

Disclaimer: I’m not an economist.  I’m sure the following omits significant issues, especially regarding obscure topics like net present value and yield curves.  Yet I think the basic premise is sound.  People who know better are welcome to contact me on or off the show.

That being said, it seems to me the mathematics is simple.  When the printing of a dollar creates a dollar of debt plus interest, dollars must continually be printed in order to accommodate the future interest payments.  For a steady-state PHYSICAL (not financial/credit/derivative) economy:

dM/dt = I * M

where M=”dollars” (real or electronic) in circulation and I=the interest rates prevailing at the time those dollars were issued.   Of course in the real world M and I are both complex functions involving weighted averages of those quantities over time.  But let’s stick with this simple approximation for the sake of argument.

So what’s wrong with this picture?  When I is positive, this is an equation for exponential growth. .  In other words, all other things being equal, debt-based currency is a recipe for exponential rates of inflation!   Increasing interest rates to control inflation would only kick the can some distance down the road, in accordance with the maturity of the loans and bonds issued at the time.

Obviously this would a major problem for the private central bank fraudsters that think they own the universe.  Those excess dollars must be destroyed or taken out of circulation in some way, or the physical economy denominated in those dollar must expand in territory, in order to control inflation.   Deliberately causing deflation, which the fed did in the 1930’s, (which caused the great depression), and again in the present era (with the help of the clinton and bush administrations, which set up the middle class with unpayable mortages and framed them as deadbeats while exporting their jobs abroad), would address the former issue, and globalization would address the latter, but war is an excellent solution on both fronts, with the added benefit that war forces governments to borrow heavily against their central banks.  With their otherworldly wealth, and partnering with the military industrial complex and associated national-security types, the owners of the world would have no difficulty pushing through the political agendas needed for continual war.   And if the central banks straddling the respective warring countries are owned by the same pools of old wealth, it’s a win-win situation regardless of which country prevails.

At least that’s my theory.  The problem its it’s so simple I have to wonder why I haven’t heard it elsewhere.  Maybe I’m totally clueless ?

Or maybe it’s time for the real national security types, who actually care about this country and its original promise of freedom, to ask some hard questions of themselves.  They could start by researching Lincoln’s debt-free greenbacks, probably the real reason he was assassinated.  Also see the links at the bottom of the reference section.