Disparate Voices … One Theme

Here are some voices, past and present, that all appear to be making similar points:

• central banks are not omniscient and therefore should not be omnipotent ... they are not gods ...
• they are not even masters of the natural cycles of human commerce and economy …
• they are servants charged with observing the laws [God ordained and man made] … by promoting just weights and measures … demanded by God and enabled by human laws ...
• and as such they should desist from [or be forced to cease] their misguided [and illegal], destabilizing [even disastrous] and increasingly [even absolutely] tyrannical financial manipulation of economic life on the planet.

But, as a practical matter, how does any society prevent the undesirable behavior and devastating results these voices appear to be condemning? The answer is clear ... central banks [like everyone else in a society] must be subject" to enforceable and enforced laws [rules] which actually limit their power ... for unlimited power, if it is to be used safely, belongs only to the all knowing ... which does not include any person or human institution.

It is time to demand that the FED obey the laws ... starting with the Federal Reserve Act under which it exists ... because the FED is not omniscient and therefore should not be omnipotent.

A President

In his charge to Congress endorsing passage of the Federal Reserve Act in 1913, President Wilson foresaw both the possibility of a central bank serving commerce under strict monetary laws ... and the hazard of a central bank attempting to rule the economy by taking unfettered control of the currency:

“The principles upon which we should act are also clear.

• We must have a currency … responsive to sound credit, the expanding and contracting credits of everyday transactions, the normal ebb and flow of personal and corporate dealings.
• Our banking laws must mobilize reserves; must not permit the concentration anywhere in a few hands of the monetary resources of the country or their use for speculative purposes in such volume as to hinder or impede or stand in the way of other more legitimate, more fruitful uses.
• And the control of the system of banking and of issue which our new laws are to set up must be public, not private, must be vested in the Government itself, so that the banks may be the instruments, not the masters, of business and of individual enterprise and initiative.”

A Pope

In his 2013 [100 years after Wilson’s remarks] EVANGELII GAUDIUM, I.57, Pope Francis said quite simply but clearly  “No to a financial system which rules rather than serves [the real economy which consists of and belongs to the real people].”

An Imam

In August 2015,  leaders of Islam worldwide made a declaration that

… affirmed

[The Lord]  raised the heaven and established the balance

So that you would not transgress the balance.

Give just weight – do not skimp in the balance.

So set your face firmly towards the (natural) Way

As a pure, natural believer

Allah’s natural pattern on which He made mankind

There is no changing Allah’s creation.

That is the true (natural) Way

But most people do not know it.

… recognized

• The corruption that humans have caused on the Earth due to our relentless pursuit of economic growth and consumption.

... called on the well-off nations and oil-producing states to 

•  Recognize the moral obligation to reduce consumption so that the poor may benefit from what is left of the earth’s non-renewable resources.

… called on the people of all nations and their leaders to

• Realize that to chase after unlimited economic growth in a planet that is finite and already overloaded is not viable. Growth must be pursued wisely and in moderation; placing a priority on increasing the resilience of all, and especially the most vulnerable
• Set in motion a fresh model of wellbeing, based on an alternative to the current financial model which depletes resources, degrades the environment, and deepens inequality.

… called upon corporations, finance, and the business sector to

• Change from the current business model which is based on an unsustainable escalating economy, and to adopt a circular economy that is wholly sustainable.

A Central Banker

And now the Fed itself, in its Current Federal Reserve Policy Under the Lens of Economic History:A Review Essay, is making what seems like the beginning of an attempt to disavow its deadly past and to lay the foundation for a “regime change” by suddenly discovering that the underlying rationale for and the unanticipated consequences of its extreme manipulation of money and credit aggregates without regard for actual production are troubling:

• “Evidence in support of Bernanke’s view of the channels through which QE works is at best mixed …. All of this research is problematic … Further there is no work, to my knowledge, that establishes a link from QE to the ultimate goals of the Fed …”

 

Too Little Too Late ?

Of course, everyone knows intuitively that ... the central bank emperors are naked ... and that the financial idols they have set up ... at which the banks and multinational corporations of the world worship ... MUST be torn down intentionally before they collapse on us without further warning ... and that either way the change is going to be very painful ... but if undertaken voluntarily according to strict laws, there is at least a chance of keeping our vision during the transition ... while if we wait for the inevitable collapse, the resulting panic will insure the complete destruction of any remaining free economy ... by an economic usurpation the likes of which the world is yet to see ... and the lies of which the world will almost certainly believe in its moment of despair.

When Tyranny Spirals out of Control ...

[If you have NOT yet read the foundational July 2015 posting for this blog entitled "America's Road to Ruin", you should do so before proceeding so that you understand the progression of lawlessness.]

While we rightly condemn the tyrants in the middle east who are destroying their own civilization … or the tyrants in Venezuela who are destroying their own economy … we are strangely silent about [even congratulatory of] the tyrant in America who is destroying our currency, and with it the free flow of capital, that underpins our past and future as free economic agents. This tyrant is the Federal Reserve which is violating the Federal Reserve Act … with consent from Congress and the President … and abstention from the Courts.

It is rapidly becoming chillingly apparent that the Federal Reserve’s monetary tyranny is drawing it [and all of us] deeper and deeper into uncharted and untested deviant behavior … to try to address unintended and unprecedented consequences … which are arising from its unwise and unlawful departure from the Federal Reserve Act … with the certain doom that this new deviant behavior will only lead to new unintended consequences … and an accelerating spiral downward … from law and order … into unrestrained chaos-induced tyranny.

In his concise summary entitled The Fed: A Loose Cannon With A Lit Fuse, Rodney Johnson explains how the Fed’s unprecedented and unlawful departures from managing credit aggregates according to the guidelines contained in the Federal Reserve Act have gutted the effectiveness of its only historic [and only lawful] mechanism for managing interest rates … the federal funds rate [the FFR].

The Fed was created to make fiat loans to the banks only as needed to keep money and credit “aggregates” growing “commensurate with” real “production” … and thus to alleviate credit squeezes [and rein in speculative excesses] in the real economy to which the banks provided real credit [from real savers] supplemented by this fiat credit from the Fed. The Fed was supposed to do this by raising and lowering the interest rate it charged the banks for these fiat loans … the federal funds rate [or FFR]. Lowering the FFR would create some temporary breathing space during difficult times for otherwise sound banks and their customers in the real economy ... and raising it would return control to [and demand responsibility from] the same banks and their customers in the real economy.

But due to the Fed’s unprecedented departure from [violation of] the Federal Reserve Act in its insatiable drive [as Johnson explains] to crush interest rates and inflate asset prices, the FFR transmission mechanism [which the Fed intentionally abandoned] has been irreparably broken … never to be useful again … and history has been made … but not in a good or a lawful way.

The Fed’s tyrannical departure from the boundaries of the law has now condemned the Fed [and all of us] to wander in a financial wilderness … without prudent or lawful guidelines … lurching from one experiment to another … proudly boasting of control … while everything is clearly spiraling out of control ... beyond the safe bounds of jurisprudence and morality.

The Fed is quickly and dramatically becoming a more and more powerful monopolistic force for destruction … bypassing the banks altogether ... intervening directly in the real economy ... picking winners and losers … favoring special interests … overthrowing constitutional democracy … and decimating historical social order and economic stability. How does this tyrant’s madness end? Perhaps, as T.S. Eliot said in his poem “The Hollow Men”, “This is the way the world ends … Not with a bang but a whimper.”

But before Eliot's final whimper, there will be increasingly deviant behavior … causing growing chaos … which can only result in complete desperation … and drag us down into total enslavement ... to our malevolent financial master. Perhaps, W.B. Yeats best describes what we are seeing, and also what to expect, from the Fed in his poem “The Second Coming”:

Turning and turning in the widening gyre  
The falcon cannot hear the falconer;
Things fall apart; the centre cannot hold;
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere  
The ceremony of innocence is drowned;
The best lack all conviction, while the worst  
Are full of passionate intensity.

Surely some revelation is at hand;
Surely the Second Coming is at hand.  
The Second Coming! Hardly are those words out  
When a vast image out of Spiritus Mundi
Troubles my sight: somewhere in sands of the desert  
A shape with lion body and the head of a man,  
A gaze blank and pitiless as the sun,  
Is moving its slow thighs, while all about it  
Reel shadows of the indignant desert birds.  
The darkness drops again; but now I know  
That twenty centuries of stony sleep
Were vexed to nightmare by a rocking cradle,  
And what rough beast, its hour come round at last,  
Slouches towards Bethlehem to be born?