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THE NEW YORK STOCK EXCHANGES GOES GLOBAL-THE CHERRY ON WORLD GOVERNMENT
by Joan M. Veon
http://www.womensgroup.org
On Wednesday the New York Stock Exchange world’s biggest stock exchange
founded 213 years ago will go public. Its goal is to build a war chest in
order to buy up other stock exchanges around the world. These actions herald
a new phase in the new world order.
With stock exchanges around the world going public, it is the New York Stock
Exchange that is the last of the private non-profit companies to offer
shares to the public. You can imagine that if all the exchanges in the world
are listed companies, then the mergers and acquisitions that are common
among other stocks will also be part of the stock exchange empire. Can you
imagine the NYX, as the new public company will be called, buying the
Euronext and/or the London Stock Exchange? Talk about power! This is a
parallel to the central banking power that now runs the global banking
system.
Furthermore, within the last eleven years, the coming of a global stock
exchange will compliment an evolving global currency and global tax. For
those who say world government is far off, you had better point them in this
direction. In order to understand what Wednesday really means, let us review
structures that have been put in place that compliment a global stock
exchange.
When Andrew Jackson was elected President in 1828 he announced in his first
message that he would not renew the charter of America’s first central bank.
He ended up vetoing the law Congress passed to re-charter the Bank. Jackson
pointed out that the bank’s stock, valued at $8 million, was held by
foreigners--chiefly in Britain. His concern was that a majority of shares of
its stock might fall into alien hands, which if we were involved in a war,
could use its influence against the United States.
In 1913, the question of a central bank came up again. The people involved
in this effort included some of the wealthiest people in America: Senator
Nelson Aldrich (grandfather of David Rockefeller); Jacob Schiff and Paul
Warburg of Kuhn, Loeb and Company, an international banking house; Piatt
Andrew, Assistant Secretary of the Treasury; Henry P. Davidson, Senior
Partner of J.P. Morgan & Company; Charles D. Norton, and Frank Vanderlip,
President of National City Bank which today is CitiGroup. The passage of the
Federal Reserve Act of 1913 was done through chicanery. Those in the Senate
who favored the Act did not go home while those that were against it went
home for Christmas. In a special session convened with quorum, the Act
passed at 11:45 p.m. on December 24, 1913.
With the passage of the Federal Reserve Act, our monetary system changed
back to one of control by a private corporation and not the U.S. Treasury.
Our currency now says, “Federal Reserve Note.” Earlier in the day on
December 24, 1913, Congressman Charles A. Lindberg, Jr. stated from the
House floor: “This Act established the most gigantic trust on earth. When
the President signs this bill, the invisible government by the Monetary
Power will be legalized…The worst legislative crime of the ages is
perpetrated by this banking bill.” We should note that President Woodrow
Wilson could have vetoed this bill like Andrew Jackson did, but he was put
in power by the same powers that passed the bill.
Since 1913, the Federal Reserve has evolved into a very powerful entity
globally. The Federal Reserve Act has been amended over 195 times with
greater empowerments in the last ten years that have included more types of
discount window loans. The discount window is where banks borrow from the
Fed overnight to maintain their stated level of capitalization. The Fed now
accepts for collateral: Treasury and federal agency securities, gold
certificates, Special Drawing Rights, foreign currencies, and discount
window loans made under Section 13 of the Federal Reserve Act. What this
means is that as the indebtedness of America grows, the Fed is willing to
take more types of collateral to secure their loans to the government!
As a result of the Asian Crisis in 1997-1998, the Group of Seven finance
ministers, under the direction of President Bill Clinton and then Treasury
Secretary Robert Rubin invited the central bank ministers of the G7
countries to join them in their discussions. Since 1998, it is both the G7
treasury secretaries and the central bank ministers who are directing the
global economy.
The role of central banking in the United States was seen after the crash of
the stock market in 1929. The Crash came about as a result of (1) America
reducing the gold content of the dollar by 40%, (2) Speculation in the stock
market, much of which was financed by credit, (3) Foreign investors selling
their stocks, and (4) the Federal Reserve taking money out of the banking
system which the Fed thought would stop the frenzy. In other words, this
private corporation used the same technique used to burst the Nasdaq bubble
seventy-two years later-they took money out of the banking system which made
the market drop.
The Fed or any central bank is able to create market highs or lows by the
amount of money they pump into the banking system (they buy U.S. Treasuries,
which puts money into the system) or by taking money out of the banking
system by selling U.S. Treasuries. When the Federal Reserve took money out
of the banking system, it caused the Depression. John Maynard Keynes, a
British socialist and economist, came over to advise President Franklin
Roosevelt. His solution was to go into debt in order to stimulate the
economy. President Roosevelt financed all of his New Deal programs by
borrowing money.
The legacy today of Roosevelt and Keynesian economics is that every level of
government is broke: local, county, state, and federal and every level of
government is selling assets in order to pay down debt. In the last several
years, the City of Chicago sold the Chicago Skyway, a toll road to Spain’s
Grupo Ferrovial and to a unit of Australia’s Macquarie Bank for $1.8B. Since
then other toll roads around the country are being sold. The ports are part
of the same equation.
When President Franklin D. Roosevelt was elected on his “New Deal for the
American People” program, his first act as president on his inaugural, March
4, 1933, was to declare a national bank holiday. For the next 8 days, banks
were closed because of the number of people withdrawing their savings in
gold.
A little more than a month later, on April 20, Roosevelt passed the
Emergency Banking Act of 1933 which took America off the gold standard. It
put an end to the following: (1) Convertibility of notes into gold for
Americans but allowed foreign countries to convert their gold-backed dollars
at any time and (2) Private ownership of gold was made illegal except if you
were a rare gold coin collector. In essence the American financial system
was transferred from a standard of accountability which used gold to guard
against excess debt, to a system in which there is no accountability. All a
government has to do is print money. This opened the door for the massive
debt which is Keynesian economics at its finest: a world in debt to a
private group of bankers.
However, if you really want to control the monetary system of the world, not
only do you have to control the banking system, but you have to devalue its
money. It was President Nixon who severed any remaining ties the dollar had
to the gold standard in 1971. Between 1933 and 1971, foreign countries that
owned gold backed dollars were able to redeem them for gold. However, when
Nixon closed the “Gold Window”, it changed the monetary system of the world
from one in which currency was gold-backed to a paper system. Basically what
Nixon did was to DEFAULT on millions of dollars that those countries held in
their vaults.
There is no other historic incident that can equate the financial
devastation that Nixon did when he took the dollar off the gold standard.
Never before in the 6,000 year history of trade, was a piece of paper been
used. During Biblical times and earlier, traders used animals, jewels,
expensive clothing, and gold and silver to trade. These all have TANGIBLE
value. Today, the world is on a fiat monetary system that has nothing of
value supporting it. The purchasing power can drop simply by government
printing more paper money! From what we can understand, this was the first
phase of changing the monetary system of the world.
The second phase was to internationalize it. In 1944, finance ministers from
over 40 countries of the world met in New Hampshire to set up financial
international institutions that would deal with a post-War world: the
International Monetary Fund and World Bank. Their objective was to set in
place global institutions that would facilitate the financial and economic
integration of the nation-states. That however was not the immediate
objective. Both of these institutions were set in place to facilitate loans
to help rebuild war-torn Europe. Today on a bi-annual basis, finance
ministers from 186 countries of the world meet to determine the state of the
world’s finances. Both of these organizations have been instrumental in
“harmonizing” financial growth around the world and redistributing growth
from strong countries to weaker countries. In fact, the World Bank
established the International Finance Corporation that has established over
60 stock exchanges in third world countries.
From an economic standpoint, if you are going to put a global economic
infrastructure in place, it must also be political and encompass trade. The
United Nations was established in 1945 and the final piece of a global
trading system was birthed in 1994 when our Congress passed the 27,000 page
General Agreement on Trade and Tariffs which established the World Trade
Organization. The purpose of which is to have a completely flat trading
system-no barriers of any kind. No longer does the American farmer,
accountant, manufacturer, or engineer compete with his competition across
town, but he now competes on a global playing field. Since President Bush II
has been in office, 2.7 million jobs have left the U.S.
Open borders supported by the World Trade Organization need for the
countries of the world to de-regulate laws that restrict where people can
invest. In 1980, during the Carter presidency, Congress passed the Monetary
De-Regulation Act of 1980. It impacted the U.S. in several ways: First, it
changed various federal laws as foreigners could now invest in America and
Americans could now invest outside the United States. These changes led to
the proliferation of foreign and global mutual funds, global mergers and
acquisitions between companies, and $2T in stateless money running around
the world daily looking for higher returns and a quick currency play.
Obviously the integration of investments and corporations is part of making
the world one and in changing its currency from individual nation-state
currencies to a global currency. Secondly, it gave the Federal Reserve more
power over the U.S. banking system.
At the 1995 Group of Seven meeting in Halifax, the heads of state and the G7
finance ministers embarked on putting in place a “new international
financial architecture.” It included a number of deep empowerments and
structural changes being made to the International Monetary Fund and the
World Bank in order to prepare it for a world without borders. The IMF has
the responsibilities which include “surveillance” of the world’s banking
systems and the flow of monies worldwide. In addition, the IMF makes
available lines of credit for countries in trouble, our Congress graciously
made $18B available for this purpose. These changes were touted by both
Robert Rubin and his successor Larry Summers as necessary for the 21st
century. This is all part and parcel of the evolving global stock exchange.
Of course, no take-over of the global economic infrastructure would be
possible without changing key laws. In 1999, Congress passed HR10 which was
the “Banking Modernization Act.” It helped modernize our banking system by
repealing the 1933 Glass-Steagall Act which separated commercial banking
from investment banking. HR10 merged these two activities, thus returning
the stock market to pre-1929 times. In addition it provided for foreign
banks, insurance companies, and brokerage firms to buy American banks,
insurance companies, and brokerage firms.
So now if you are going to globalize the entire financial architecture, you
then need international accounting standards. Using Enron as an exampled,
former Federal Reserve Chairman Paul Volcker called for international
accounting standards. The fact that he is chairman of the Board of the
Trustees for the International Accounting Standards Committee (IASC) which
is located in London was very convenient! Now countries around the world are
converting to these new rules.
Getting “Joe Average” into the market was also necessary. By the end of the
1990s, the highest number of Americans, 45%, owned stocks either through a
401k, IRA, or personally. Today, the market has a psychological affect on
people. When it is up, people feel good and when it is down, they are not
happy. When Greenspan was Fed Chairman, the bottom line is that “When
Greenspan speaks, the markets listen.”
Lastly, to facilitate a global financial architecture, you need
“market-based democracy” - that is what Treasury Secretary John Snow called
it in February, 2004. He basically told the world that every market is
dependent on growth in another country and that we need to let market forces
work.
Secretary Snow was signaling the new MARKET BASED GOVERNANCE SYSTEM in which
the stock, bond, commodity, and currency markets now rule the world. This
change has been coming for some time and began with President Reagan and the
privatization or selling off of government assets that he encouraged. Those
assets, in some cases, went into the market. The World Bank also developed
the market by setting up stock exchanges in many developing countries where
there were none: China, Russia, Brazil, South Africa, Ghana, Poland, etc. To
help these countries have stock to trade on their new exchange, they sold or
privatized state owned assets: railroads, banks, telephones in order to list
them on their new exchange. According to the World Bank, more than 80
countries are selling state-owned assets.
At one point in our banking history, banks held the loans they made as part
of their portfolio: mortgages, automobile loans, credit card loans, and
personal loans. Today, banks have sold them and transferred the risk that
they use to assume to the market (you and me). This technique is called
“securitization.” What this means is that the market now is like the kitchen
sink-everything is in it: mortgages, auto loans, credit card loans, home
equity loans, stocks, bonds---everything and now stock exchanges!
In 2002, based on remarks by Dr. Jacob Frenkel, I asked him if he saw a
global currency in the market for a globalized world. He told me that before
we could have a global currency, we needed harmonization of economies.
Eighteen months later I asked former Federal Reserve Chairman Paul Volcker
if we needed a global currency and he told me, “For the long term-but it’s a
long ways off, if we are going to be successful in a globalized world, we
should have an international currency.” Since 2004, I have been asking key
officials at the Bank for International Settlements in Basle about a global
currency, they have told me it is a long way off. I don’t know what they
call “a long way off” for chief economist William White just issued a
Working Paper, #193, in which he says the global imbalances that the world
economy currently has will lead either to a return to the gold system (which
is highly unlikely since you can’t print paper like we are currently doing)
or an international currency.
So now we have the harmonization of world economies, the calls for an
international currency, a market based system in which all assets are now
traded on the stock or bond exchange and we are seeing now the rise of a
global stock exchange! All we need now is global taxation and that too, is
in the works.
The United States is the only country in the world NOT to have a Value Added
Tax and this is now part of President Bushes “tax simplification” measures.
As well, France is the first country to put a tax on airline tickets to help
the poor countries of the world. There are ten other countries that are
considering it as well. I asked French President Jacques Chirac what he
thought about a tax on airline tickets and he told me that if it was
success, “many more global taxes of this kind” were being planned. Welcome
to the new world order. World government is not coming. It is here.
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