The Shadowy World of Finance

The shadowy world of Ministers' meetings and global financiers’ conclaves needs to be better explored and investigated! Virtually unnoticed by the world’s press, the Mexican government has just hosted the first ever meeting of G20 foreign ministers.

The G20 countries are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the UK, the US and the European Union.

It is allegedly sanctioned personally by the President of Mexico, Felipe Calderon, and the purpose of the G20 foreign ministers meeting is a “brainstorming exercise on today’s most salient issues of global governance.” The G20 is the self-described primary world financial and economic forum, so all attention will be on the world’s finance ministers and central bankers in Mexico City this weekend.

As the Mexican Foreign Minister, Patricia Espinosa-Cantellano, put it, there is a need to address “the current sense of impasse in multilateral institutions.” There is a “global governance gap” which the G20 has been called upon to bridge with “vigorous and effective leadership.” According to her, there is urgency as “the world is running out of time.” It would be of great interest to know what is on the ministers' minds and why such a secretive hurry.  What kind of event or events the G20 organizers are so eager to prevent?

There are two policies on the table. The first policy, pursued by Germany and France, is to stick with “austerity measures” that imposes tight fiscal control on heavily indebted countries, like Greece. This includes drastically reducing the value of those national assets, within the previously inflated asset bubbles, that are targeted for future privatization, in case of Greece by the German and French banks. The inevitable consequence of this policy, however, is that it consistently depresses economic growth of the target nations, and requires a great deal of financing from other international financial institutions, IMF for instance, willing to participate in the subsequent privatization of parts of the target nations economies thus even further depressing their economic growth and prolonging the painful consequences of such policies.

The second policy, pursued by the US, China, and Japan, is to urge already heavily indebted countries, including Greece, to assume even more debt, under the pretext of stimulating growth, by way of having their national central banks print more money (it is called “quantitative easing”) in order to “reflate” the national “asset bubbles”. The problem with this policy is that it creates inflation which leads to heavier sovereign debt burdens and in the end lays the ground for more severe financial crises in the future.

Whichever of the two policies are adopted it will leave Greece, or any other nation in such a situation, no chance, though. But there is another aspect to this essentially anti-national global privatization campaign unleashed by the world’s largest banks and their cronies. It also will affect financial markets, speculating on precious metals like gold and silver and cyclical stocks. It applies especially to those stocks that rise very quickly at the first signs of economic growth, like automobile industry for instance, and fall rapidly when growth is slowing down. It is these short-term economic fluctuations in prosperity, based on excessive amounts of debt, and inevitable subsequent depressions, as a consequence of deleverage, that the international financial institutions involved in this Greek tragedy are hoping to take advantage of in the future.

As the saying goes, there is the “good side” to globalization and there is the “bad side” to it. The “good side” of globalization is about easy credit and rising leverage, as money flows easily across local and national boundaries, and creditors in their greed fail to distinguish between good and bad borrowers, boosting aggregate demand. The “bad side” of globalization is about tight credit, deleverage, and declining money flows across local and national boundaries, as creditors tighten credit to both good and bad borrowers, depressing aggregate demand. The expert combination of these two sides of “globalizing” the world, nation by  nation, sets the global economy into a vicious cycle of income and employment rises and declines when euphoria is succeeded by pessimism and any growth only precedes a burst of another Speculative Asset Bubble eventually leading to further redistribution of the global economic assets, current and fixed, in favor of the largest banks. Thus is being perpetuated the spiral of the global privatization of the world economy and accumulation of its assets in the hands of a few largest bankers.

It is astonishing that a secretive clique of bankers and financiers from a number of nations have made it their goal to use their Financial and Bank Credit Instruments as modern day weapons to procure influence and political power to eventually become the sole owners of economic infrastructure the world over. As to those nations and local communities that effectively oppose their encroachments, financial barons threaten them into obedience invoking the specter of trade wars and sanctions. Those nations that take a more active stand against them, the modern day corporate fascists intimidate and destroy whole nations using more conventional weapons of destruction and national humiliation.

It should come as no surprise that the words “corporate fascists” fits those modern day invaders so well when it comes to the “ugly side” of their enterprise. When nations stand up to protect and defend their national economic identity from the world’s leading bankers, they face the prospect of open military invasion and war. No nation in the world is exempt from the prospect of an armed conflict, should its national leaders actively oppose the ill meant advances by the bankers. The ugly boldness and arrogance on the part of the world’s leading financiers of today has reached such levels that they almost openly utter threats of usurpation and war to the whole world.  Even so that last year, the Forbes’ online edition of 9/10/2011 published the following:

“The ugly side of globalization is when nations and local communities try to escape the vicious cycle of income and employment declines through simultaneous currency devaluations; and by raising trade barriers that in essence put an end to globalization and a beginning to trade wars, as were the case in the 1930s.

“In the last quarter of the century and for the most part of the first decade of this century, the world has seen the good side of globalization. In the last four years, the world has seen the bad side of globalization. We do hope and pray that the world won’t see the ugly side of it.”

Such a bold reference to “trade wars” back in the 1930s is just a mild reminder of what Anglo-American corporate policies at home and in Germany had been triggered by and what it eventually had led to. Given the fact that the article was published by the leading source for financial information, a statement like that sounds nothing short of a threat.