The emergence of a new financial order
On the morning of Friday 22 July 2011, after a long and intense political kabuki with much fanfare and applause, the EU circus was celebrating another victory in an even longer list of sublime Pyrrhic victories: the pathetic and entirely temporary “salvation” of the Eurozone financial system from total collapse. But despite the all too typical short-sighted self-deception, the specter of death and chaos hovers, threatening the proceedings and their political aftermath with the sombre visage of a disaster long gone, and largely forgotten in Europe among its semi-illiterate descendants due to decades of educational neglect.
Global markets have reacted with typical knee-jerk anticipation to the promise of increasingly seductively glowing hot ink on newly printed electronic banknotes: a grotesque imitation of a snake chasing and eating its own rapidly disappearing tail. Leading the way are the usual suspects, the criminal banking cartel: Barclays, RBS, Lloyds. Moral hazard on a galactic scale has never been so good business under the prevailing insanity of the political class. Their arrogance and detachment from reality are accelerating at a rate that can only be compared to the monetary inflation that their stupidity and moral cowardice have now unleashed on the world.
So what have our incompetent misleaders actually done? According to media reports, where recent events in the UK have shown that they can hardly be trusted in these dangerous and perilous times, the EU has just set up its own Treasury, now going by the modest and deceptively not-so-grandnamed “European Financial Stability Fund” or EFSF. The deal agreed yesterday effectively gives this “fund” the power to underwrite to “private investors” the public debt of the first EU member state to default on its sovereign debt, which as we all know is a code word for the confederation of financial powers centred around the City of London and its lesser appendages, Wall Street, and their imperial financial funds.
In the case of beleaguered Greece, the repayment of these debts would reportedly temporarily become the sole competence of the EFSF, effectively creating a transfer alliance within the EU bureaucracy. The EU would “reluctantly” assume this burdensome responsibility on behalf of its member states, in exchange for holding Greek national assets as “collateral”. In practice, this would mean that Greece no longer exists as a sovereign state, essentially wiped off the map and replaced with an item in the EU accounting system. Of course, it would be rude to state that the EU doesn't actually have an accounting system. Otherwise, how could they have concealed all the fraud and corruption that has caused the accounts to not be approved to this day?
Constitution, what constitution?
As if that were not enough to inspire existential fear and anxiety, the entire EFSF arrangement, at least in its current form, is patently illegal under the provisions of the Lisbon Treaty and also violates the founding treaties of the European Union, which expressly prohibit member states from assuming liability for the debts of other member states.
It is difficult to see how such a proposal could be implemented without ratification by all 27 member states, given that the debt crises in Portugal, Ireland, Italy and Spain have all reached the point of no return and the impact could be significant.
In parallel with this Machiavellian maneuvering, the German Constitutional Court itself is due to rule on the EU bailout in September, following a lawsuit brought by a group of prominent economists and eurosceptics. Clearly, the developments around the EFSF have dramatically increased the risks and potential impacts of any decision that this court will make.
That being said, where there is a megalomaniacal, corrupt and greedy will, there is always a way. A glimpse into the character and behavior of one of the de facto linchpins of the international financial oligarchy, Dominique Strauss-Kahn, should be enough to dissuade any attempt to make sensible and rational inferences about the legitimate and just governance at the top of the shining pyramid of misery that is being built on the backs of us all.
A systemic crisis
Meanwhile, across the Atlantic, emotions continue to be divided as the US approaches the deadline for raising its current government debt ceiling. Readers will know that this crisis is a perfectly legitimate outcome of the original bailout launched in 2007 following the collapse of Bear Stearns, and can be traced back to the same criminal banks and financial sharks behind the conspiracy surrounding the EFSF.
Ever since those stormy days, these same criminal banks have continued to threaten, cajole and run wild, sucking the veins of the public's wallets into an endless black hole of worthless, failed financial paper. And yet, the herbal tune never changes, and with each inevitable economic downturn, there are no cries of atonement for wrongs, only more cries to loosen the wasteful entrails of the quantitative beast.
Is this really just an honest mistake on the part of the guardians of the modern central banking pantheon, or fundamental economic ignorance, or simply Neanderthal stubbornness?
Make no mistake: the EFSF and what it stands for is not a temporary solution, but a fait accompli, a coup de grace, that the ruling class had been planning for a long time. All they needed was for a “righteous existential crisis” to magically appear, for entire governments and nations to panic and renounce their freedoms and birthrights, all in the name of the fraudulent game of monetarism. We are now in the endgame, with civilization as we know it, the entire foundation of legitimate democratic politics, on the brink of annihilation, with supranational economic governance being rudely and violently imposed in its place.
Conversely, none of this is inevitable. The U.S. Congress is currently considering HR 1489: The Return to Sound Banking Act, which would return the banking system to government control and implement the strict “Glass-Steagall” separation of commercial and investment banking, a key precursor to bankruptcy restructuring and recapitalization. Perhaps not coincidentally, City AM reported this week that “full Glass-Steagall enforcement is back on the agenda for the Independent Commission on Banking.” Will healthier institutional forces step in and save us all from the brink? And, more importantly, what are we – that is, you – going to do to ensure that they do so?
What next?
In 1349, Boccaccio began writing his masterpiece, The Decameron, a vivid portrayal of the madness and decadence of a country plunged into a biblical economic crisis brought on by the usury of the Lombard banks Banca Bardi and Banca Peruzzi, which had collapsed in 1343 after Edward III defaulted on his debts.
Set against the backdrop of the Black Death ravaging the city of Florence, Boccaccio cast seven men and three women who flee the massacre and take refuge in the city's hills, telling a bawdy, sordid tale of human folly and failure. All around them, death and disease ravage the landscape, wiping out two-thirds of the city's population and plunging continental Europe into what would become known as the New Dark Ages.
As July draws to a close, and alarm bells and emergency indicators of the collapse of the global economy are ringing out in a crescendo, screaming ferocious warnings, we are in a much more dire situation than this. This time, in the world of electronic money and markets, there is no theoretical limit to the speed of a hyperinflationary explosion in the global financial system, except for the mathematical constraints on the size of 64-bit floating point numbers, which are certainly very large numbers. If QE3 is implemented, the impact will be immediate, we will pass an inflection point, experience an economic shock front similar to the sound barrier, and monetary expansion rates will become hyperbolic. An 18% increase in electricity prices will soon rise to 118% and then 1118%, and we will starve or freeze to death, without access to the necessities of life.
This is before we even consider the potential social and political unrest that a collapse of the current financial and monetary system would cause. The phone tapping scandal is just the tip of a very large iceberg within the system that will soon spill over into violence in the form of assassinations, terrorism, coups and revolutions if order and stability are not restored in the near future. The events in Norway cannot be treated in isolation, but should be treated as a harbinger of much worse to come if the root causes of the crisis are not addressed.
Yet the survival of Giovanni Boccaccio's work despite this growing threat shows that even in the darkest chapters of human history, great works and the ideas that inspired them can survive and even thrive long after their authors and their difficult times have passed. This didn't do much good for the inhabitants of Florence at the time, and it's important to remember that Medieval Italy wasn't harboring an army of nuclear and biological weapons…
Our Mission
The genius of Boccaccio, Dante and Chaucer should be our guide in these dark times. A society that is crumbling around us under a constant stream of neglected and dehumanizing violence, sex and banality cannot be saved by willpower alone. There must be an appeal to something much deeper to summon the spiritual strength to dissolve the mass of inexplicable dark energy that is suffocating people, and the ability to respond in a way that does not perpetuate the downward spiral into which we are now in danger of falling.
Percy Shelley, in his final summary of A Vindication of Poetry, writes that only in times of great struggle for existence can the body politic communicate and receive profound thoughts about man and nature. Therefore, we should rejoice in the fact that the oligarchy and its corrupt system are collapsing under the weight of its own corruption and inability to manage the affairs of humanity. After all, is this not the moment we, the millions of suffering, oppressed, nameless “serfs” who turn the pages of history, have patiently awaited? And is their complete arrogance and fearlessness in defeat not a sign of the strength of the ruling class, but of its weakness?
But nevertheless, the crisis that now threatens us will undoubtedly call upon reserves of discipline, resilience, and strength of purpose that we have not yet drilled into ourselves. It is therefore the responsibility of those of us who truly understand the magnitude and gravity of the situation to fight for the reforms that are now a matter of national survival. Though we may at times doubt our sanity, our courage to continue to resist the political, economic, and social turmoil that engulfs us, we must remain faithful to our mission, for our cause is just, and our straits leave us no other choice. We cannot sit idly by, wisely observing from some distant philosophical hilltop as our country and the world disintegrate in an orgy of cannibalistic madness. We must not despair. And we must never give up. Whatever the fate that awaits us all, we are in this fight together to the end.
