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Thursday, March 19, 2015

Monetary Reset: Two Words You Aren't Supposed to Know

~ A 5 Billion German mark Postage stamp issued during their 1922/23 Hyperinflation crisis

I was having a discussion/debate the other day about the Congressional Republican proposed budget for 2016 which will ultimately be voted on in the autumn..

And it was pretty much a same ol'- same ol' of all fiscal Conservative plans to tackle the US debt load: Cut taxes to corporations from 25% to 15%, lower other taxes which the top 1% are paying and then make up the difference with massive amounts of cuts to social services like Social Security..

And to be honest, its an attitude many (pretend) Democrats hold as well as illustrated by a posting we wrote a week or two ago where the Democratic Governor of Pennsylvania wants to cut corporate income taxes by 50% and make up the losses by raising the sales tax so everyday people make up the shortfall.
~ A 50 Million German mark banknote issued in early 1923

You will hear politician 'squares' of all stripes talk about budget and debt and debt 'ceilings' for the next year and a half until some new scoundrel is elected President..

And no one will have the guts, desire or inclination to honestly tell the American people its all illusion..   Its Pretend!

All these fear mongering tactics of our debt one day being called in by the creditors and future generations suffering, etc..     Its all bullshit
~ A German using monetary marks as wallpaper since they were worthless to purchase anything

Even we for a time were suckered or scared into that mindset until we took some time to really delve into what happened with the post World War 1 Germany's Weimar Republic and how their hyperinflation panic was quickly and rather neatly fixed...

It is called Monetary Reset.

We've explained this before and because of its Importance will briefly do so again..

Because Germany had fully borrowed from banks to pay for WWI rather than tax its citizens via an income tax and the financial burden of war reparations, the value of its currency began to seriously plummet in 1921
~ Using German marks as building blocks

During the first half of 1921, one US dollar was worth 90 German marks.

By November 1923, the American dollar was worth 4,210,500,000,000 German marks ($1 = 4.21 Trillion marks)

Now if this was "real" which is to say if this situation was not easily fixable through banker and financier trickery, the entire global economy would have been Destroyed six years before our own stock market crashed.

So what happened.. how did the situation get fixed so Germany and the rest of the world didn't fall into a horrific financial abyss?
~ This 10 Million mark German Railroad Note Would buy about ½ Pound of Meat, 4 eggs or 2 pounds of potatoes. Bread is 2 Million Mark a loaf.

Simple.. In short, some global bankers in nice black suits got together in a comfy room, sat at a table and with some pen strokes re-valuated the currency

That's all monetary reset is

Some decimal places were moved to the left...  T's were crossed..  I's were dotted and Ta Da!!  All done..
That 4,210,500,000,000 marks to $1 ratio?

Abracadabra...   Presto!!

It became 4.21 marks to $1

A new German currency called the Rentenmark was created to replace the worthless Reichsbank marks on November 16, 1923 and 12 zeros were cut from prices and new currency stabilized very quickly stabilized the German economy.
~ A Two Rentenmark note

And THAT is precisely why everything any US politician who talks about the budget and National Debt especially where fear mongering is concerned is full of shit!!

Because if push came to shove, and the truly rich and powerful were about to see their net worth devalued by 80-95% and all the banks and the control they exert crumble to the ground in one fell swoop, they'd come together and create some scheme out of thin air to 'Fix' everything..

It has been done before.. This is exactly how every historical 'Panic' in US economic history has been solved..  Rich powerful bankers enter a room and quickly 'solve' everything..

Whatever it takes to preserve financial power and keeping billions enslaved in borrowing and debt consumption..
As individuals, some of us experience this magic trick called monetary reset in the form of a Chapter 7 bankruptcy...

Let's say you owe creditors $100k to $200k but show no reasonable ability to ever re-pay and there's nothing of value such as home, car, life insurance, etc which creditors can take from you?

Well there's no jail time.. No public flogging.. Instead that debt is merely discharged..   Gone..  Poof!

Sure your credit history is terrible for awhile but when its all over, like magic you owe nothing-- all those debt collector calls and letters and bang-bangs at your door instantly Stop!

That's monetary reset on a micro-economic level.
And in case you're wondering.. Why don't the banks do this for a seriously impoverished nation like Zimbabwe?

Simple: 1)  Banks and investors' exposure i.e. risk of loss is minimal; 2)  Its in Africa;  and 3) They are black..

So now when you hear Dems and Reps try to scare the willies out of you and others with talk about unsustainable debt and fiscal responsibility and the need for cuts, etc, know that they are all playing a game where they control the parameters of the discussion..
~  Remember if it was to a banker, financier or economic power elite's benefit, 12 digits of our national debt could be erased in a pen stroke and we'd only owe our creditors between $16-17 dollars..

And you the everyday person are not supposed to know its all meaningless mumbo jumbo meant to get people elected and parties in control of power and those secret two words:

Monetary Reset.