Professional Documents
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FED CHAIRMAN
BEN BERNANKE What Can Average Americans
Expect to See in Near Future?
By Mike Finch largest debtor nation the world has ever
seen. In only 20 years we owe the world
any prominent economic over 13 trillion—with a ‘T’—dollars.
Y
way. Right now the bubble has gotten so scene.”
your house with loose portion drops. That’s why it’s best to do big . . . that it’s going to be very traumatic Rogers looks at the Fed’s willingness
change. Round figures will this early in the game. [when it bursts].” to add liquidity to an already inflationary
be used here. Say you pay As homebuyers grew wise to this, Billionaire financial commentator environment and sees the history of the
$300 a month on a 30-year mortgage. some banks inserted a clause in their and Ron Paul supporter Jim Rogers also 1970s repeating itself. One example of
Your amortization schedule shows that, loan agreements that rendered early predicted a recession in a 2007 interview an area of the Fed’s mismanagement is
on your first payment, $287 goes to in- payments moot for the first one or two with the Financial Times. He had been how they are dealing with bailing out the
terest and $13 to equity. So, write a years. So, in settling on a home pur- predicting a big recession for about 10 housing lenders.
check for $313 and you have knocked chase, ask if the lender has such a rule years (as has AFP), and is finally seeing This month Bloomberg.com broke
an extra month’s payment off your bal- and how long does it apply. his predictions come true. He blames down Rogers most recent interview
ance. Do this every month and your If you are already paying for a home, both the federal government and the Fed- about an example of the Treasury De-
house is paid for in 15 years, not 30. ask your bank the same question, get an eral Reserve. partment’s mismanagement and money
Of course, as the months and years amortization schedule and start making “The U.S. dollar is a terribly flawed creation.
go by, the share of your payment that is “extra” payments. currency. As recently as 1987 the U.S. “The U.S. Treasury Department’s plan
was a creditor nation. We are now the See EXPERT’S SEVEN-POINT, page B-6
B.2 AMERICAN FREE PRESS • August 2008 THE U.S. FINANCIAL CRISIS: A SPECIAL REPORT FROM AFP
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A few European shops and restaurants have refused to
nesses must adapt quickly. In this era of accept dollars from American tourists this summer be-
international trading, knowing how a cause the business owners don’t know what the exchange
weaker American dollar is likely to affect will cost them when they go to the bank the next morn-
one’s business may avoid some critical mistakes. ing. Others have simply added an extra 5% tariff over
The dollar has shown continued weakness against and above the known exchange rate of that day in order
other currencies as well, including the British pound, to protect against that unknown of tomorrow’s rates. In
Australian pound and Japanese yen. However, the most some countries in the last century, the hyper-inflating
dramatic losses have occurred against the euro. From its currency got so out of hand that people were paying for
low of 84 cents in July 2001, the euro has risen steadily their restaurant meals at the time they ordered, fearing
in value, stopping just short of $1.60 on July 11, 2008. that the cost would increase before they could finish eat-
When it rose to the then-record of $1.29 on Jan. 13, ing.
2004, Jean Claude Trichet, European Central Bank This brings to mind an anecdote from the 1923 post-
(ECB) president, signaled mounting concern over the WWI hyperinflation in Germany. A woman was standing
euro’s rapid rise by saying “brutal moves” in the dollar in line outside the grocery market holding a bushel bas-
and “excessive exchange rate volatility were not wel- ket full of deutschmarks, waiting to buy bread and a few
come and not appropriate” and that Europe’s policy mak- other staples. Suddenly, her four-year-old child broke and
ers were concerned. His remarks and those of other ran from the sidewalk into the dangerous street. The
European officials triggered a sharp fall in the euro. young mother set down her basket full of cash and ran there no longer is anything behind it to keep it sound,
However, observers note that talk without supporting ac- after the child, grabbing and scolding him. When she re- and no fiat currency is any more intrinsically valuable
tion usually produces only short-term results, and the turned only a half minute later, her paper money was than another.
dollar continued to trend downward in value. dumped on the sidewalk, and someone had stolen her Richard Russell, who is sensitive to changes in mar-
In recent years, Ferrari, the Italian sports car maker, basket. ket sentiment, commented on his web site July 7, 2008:
reported that it is losing money on each car it sells in the This is the ultimate result of any paper currency un-
U.S., its largest market, because of the falling value of backed by something of intrinsic value, and no fiat cur- To start with, my instinct tells me that we are
the dollar. Other European carmakers, including BMW, rency in the history of this planet has ever survived. The moving into an era of momentous events. I believe
Volkswagen and Porsche, have seen their profits plum- term “sound as a dollar” is gone with the wind because that huge changes are being thrust upon us. I don’t
think these changes are being recognized as yet. I
believe that underlying those changes will be the
Is Money the 12th and FINAL Religion? subject of fiat money and the importance of central
banks throughout the world. The creation of
What Does the Bible Teach About Money? “wealth” through the mechanism of fiat money is
basically irrational and yes—immoral. You cannot
mandate prosperity through the process of printing
money. Yet nations and their politicians and central
AL L -NE W BOOK FROM
T HE BARNES REVIEW MONEY: banks have been doing this since 1971. My guess
is that we are fast moving toward the period in
which “the piper will be paid.” That’s the big pic-
ture as I see it.
THE 12TH & FINAL RELIGION The U.S. dollar index was 120 seven years ago. It is
A UTHOR R. DUANE WILLING gives you the key to understanding why the illumi- now 72, a decline of 40 percent. Market participants be-
nated ones of the New World Order need to substitute secrecy for justice. Learn how God lieve that the dollar will continue to fall against the
Moloch, devoid of any capacity for either mercy or forgiveness, is moving with brute euro. Forecasts that the euro will continue its increase
force for world control behind the myth called Israel. The Moloch myth conceals the invention of are rampant as the once great American dollar continues
credit based money. Belief in money drives the human condition to prey on the planet and its in- its decline. U.S. firms that export their products to Eu-
habitants. Money creation has Biblical consequences called usury. The key to usury is hidden in the rope can look for another banner year. U.S. firms that
legend of the Holy Grail. The covenant obligation to take dominion and prosper in harmony with import from Europe should protect themselves by hedg-
nature is subverted by secretive organizations. There is talk of Bilderbergers, and various councils ing in foreign exchange markets, say the experts. And
and globalist corporations. As if by design, the collective mind remains hypnotized by their Moloch what are the implications for U.S. citizens? One financial
magic of central banking with its perpetual (national) debts, money at interest and stock exchanges writer put it this way: “Have you ever seen the Grand
and income taxes. Canyon?” Consider yourself forewarned. ★
Money: The 12th & Final Religion
Pat Shannan is the assistant editor of American Free Press. See more
Softcover, 193 pages, #508, $17. TBR subscribers take 10% off price above. Order from TBR BOOKS, 645 Pennsylvania Avenue SE, Suite 100, from Pat at www.patshannan.com or www.AmericanFreePress.net. He is
the author of One in a Million: An IRS Travesty from AFP. Softcover, 270
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THE U.S. FINANCIAL CRISIS: A SPECIAL REPORT FROM AFP August 2008 • AMERICAN FREE PRESS B.3
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shuttered 27 stores already and has earmarked at least two
business closings all over the country, dozens more for shutdown by the end of the year. Ann Taylor is gadgets through it catalog and website, have filed for
of chain stores have announced massive cut- closing 117 nationwide; the owners of Lane Bryant, Fash- bankruptcy.
backs and closings of less productive outlets. ion Bug, and Catherine’s have earmarked 150; Women’s Other store names, some better known to Americans
retailer Cache announced “20 to 23”; Talbots knocked than others, that have closed, are closing or are in a “cut
Among the larger chains, Home Depot said it is closing about 78 last year and will close 22 more this year; Pa- back mode” are Zales and Piercing Pagoda from the jew-
15 stores due to the slumping economy and poor housing cific Sunwear of California, having closed 74 outlets in elry industry; Walt Disney, Children’s Place and KB Toys
market. This is the first time the world’s largest home im- 2007, has now announced that the remaining 154 are to go for children; Sprint/Nextel and CompUSA in the com-
provement chain has ever closed an outlet for performance away in 2008. puter and electronics market; Macy’s Department Stores;
reasons, and the move will affect over 1,300 employees. Gap Inc. is closing 85 stores. In addition to its name- Movie Gallery and Hollywood Video stores; Wilson’s and
Shoe seller Foot Locker announced a year ago that it sake chain, Gap also owns Old Navy and Banana Repub- the Leather Experts; Lowes and Office Depot.
had begun drastic clearance sales to move out the inven- lic. The company said the closures—all planned for fiscal Even the great department store chain, reborn in the
tory of 250 of its stores prior to closing the doors, and 2008—will be weighted toward the Gap brand. 1930s through the efforts of one of its founders, James
CEO William Dillard II announced earlier this year that Both Levitz and Wickes, longtime furniture retailers, Cash Penney, following the crash of 1929, is scaling back
Dillard’s Inc. will continue to focus on closing underper- are going out of business. Wickes, a 37-year-old retailer in an effort to avoid another wipeout. J.C. Penney’s revival
forming stores, reducing expenses and improving its mer- that targets middle-income customers, filed for bank- was one of the great business success stories of the De-
chandise in 2008. ruptcy protection last month. Richard Levitz opened his pression Era. Now it could be over.
Late last year the Bombay Company closed all 384 of first furniture store in Lebanon, Pa. in 1910, and the next Meanwhile, the Bush administration and Ben Ber-
its U. S.-based stores. The company’s online storefront has generation introduced the warehouse-showroom concept nanke at the Federal Reserve Bank continue to insist that
discontinued operations as well. to its customers in the 1960s. Another furniture retailing the economy is stable. And they’ll keep telling you that as
The clothing industry, especially women’s apparel, giant, Ethan Allen, is closing 12 of its more than 300 long as you’ll believe it. ★
Fiat Money:
Transferring your wealth to the wealthy—as planned
By Pat Shannan Are you really concerned that Social Security will
soon be broke? What an out-of-focus worry that is. Some
hile the benefits to the money creators go
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blowhard senator planted that fear in your mind last year
beyond this basic reason, the very purpose so he can claim to have fixed it next year. Note this: no
of the invention of paper “money” was to government-funded program will go broke as long as the
transfer all production and wealth to the printing presses and credit computers are operating.
state and the banksters without payment. Americans have been living in this fantasy world
Anything that can be created to infinity with political since June 24, 1968—the day that the banks quietly
incentive eventually becomes worthless. There are no ex- closed the window on silver redemption for the lawful
ceptions. So while so many of the common phrases in Federal Reserve notes promising to “pay to the bearer on
today’s rhetoric are no more than double-speak, there is demand” the designated amount of lawful money. In
one that is very real—inflation—and with it we see the short, the banksters reneged on the promise because they
destruction of the American economy before our very had created too much paper to possibly redeem with real
FORMER FED CHAIRMAN
eyes. specie. Such a move did manage to postpone the in- ALAN GREENSPAN
Most Americans simply do not understand that gaso- evitable, but now the chickens are coming home to roost.
line prices are not up, but that the dollar is down. The re- 12 USC 152: “The terms ‘lawful money’ and ‘lawful
cent doubling in the amount of Fed notes necessary to money of the United States' shall be construed to mean to portray) at this time last year. All of it is smoke and
own gold and silver is but a reflection of the shrinking gold and silver coin of the United States.” mirrors.
value of the paper currency. As more is created, such as The “notes” that have been issued since June 24, 1968 Their economic theory states that there are four major
with the harebrained scheme called “Economic Stimu- (and for five years before) are not lawful because they do factors that determine the exchange rate between two
lus,” where 130 million American households got $1,200 not offer to pay anything to the bearer. In effect, the “re- currencies: the comparable interest rates; the relative in-
or so, nothing is stimulated except the soon-to-arrive hy- ceipt” for the gold and silver in the storehouse was trans- flation rates; the comparative level of income; and the
perinflation. The modern “dollar” is a myth. formed into the entity. A “dollar” was no longer a macro policies of the respective governments—with a
With imaginary money, such things as the “national measurement of gold or silver but a simple piece of whole lot of blah-blah-blah in and around each citing.
debt” and “taxpayer’s money” are imaginary, too. How paper claiming to be the actual dollar. It was sort of like We say that there is a much simpler way for Joe Av-
can there be such a thing as “taxpayer’s money” when the hatcheck girl telling the patron that she was keeping erage in the street to understand why his favorite ciga-
there is no lawful money circulating in existence? The his hat but that he could now wear the check on his head rettes are now $50 a carton and why he now has to think
income tax funds nothing. Everything is “paid” with the because it was the same thing. twice before taking his car out of the garage. There is no
creation of “money.” The people are “taxed” to maintain Mainstream media “economists” like to write about government hocus-pocus or gobbledy-gook here: the
the illusion that they are actually funding something and the government’s curbing of inflation and that it is more paper “money” pieces you insert into the system,
“paying their fair share” to keep the nation operating. “down” to 4 percent this quarter when it was “up” to the less each individual piece becomes worth. Very little
Nothing could be further from the truth. eight percent (or whatever imaginary figure they want education is sufficient to understand this.
Short term interest rates and trade deficits be damned,
fiat money is tyranny, and it guarantees a criminal gov-
The Lost Science of Money: ernment.
All modern wars are paper money wars. Paper money
pays the politicians their lavish profligacy, and they all
The Mythology of Money—the Story of Power (except Ron Paul) keep their mouths shut about the fiat
Stephen Zarlenga’s new book, The Lost Science of Money, system. All the tyrants in modern history did their dirty
traces the money power through three-and-a-half millennia from work with paper “money.” Governments suppress the
barter to the euro. This book draws fascinating, previously lost mon- truth (with control of the press) and oppress the people
etary principles from ancient Greece and Rome, from the experi- (by arming more agents to enforce unconstitutional
ence of the Moslems, Venice, the Templars, the Jews, the Bank of statutes) with the power of a paper currency creatable at
Amsterdam and the Bank of England, plus the Federal Reserve Sys- will. Fiat money from its inception was created to de-
tem. fraud.
The book also shows that the question of usury is far from set- The phony monetary system builds the centralized
tled, and that monetary reform is more a matter of morality and law power within the state and diminishes the individual. It
than of economics. Zarlenga’s book also demonstrates that a good
bestows all power on the money creators and enslaves
the people. Paper money, personal freedom and privacy
money system must be based in law, not in commodities. The book
are incompatible, and while its own inflation will be its
also defines the essential elements needed to remove structural in-
ultimate destroyer, the process will first take the wealth,
justice from our money system.
life savings, land and homes from a large percentage of
The Lost Science of Money (hardcover, 724 pages, item # 1070, $80—AFPRC Members pay $70)
the people. ★
is available from FIRST AMENDMENT BOOKS, 645 Pennsylvania Avenue SE, Suite 100, Washington,
D.C. 20003. Call 1-888-699-NEWS (6397) toll free to order by Visa or MasterCard. Pat Shannan is the assistant editor of American Free Press. See more
from Pat at www.patshannan.com or www.AmericanFreePress.net.
THE U.S. FINANCIAL CRISIS: A SPECIAL REPORT FROM AFP August 2008 • AMERICAN FREE PRESS B.5
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Globalism, as seems to be the goal of such clandestine
ignorance to much of what happens in the groups as the Bilderbergers and Masons, is flawed be- but strangely both have the same problem: they create
world around them in regard to government cause its answer is to control from the top down what an atmosphere that is conducive to the abuse of human
and economic realities. Who can blame happens in the world to effect change. It lacks moral rights. What is the answer then? I am not sure. There may
them; the government is such an immense guidelines, but the primary flaw of globalism is the im- be many answers. But the one thing that both globalism
system that even those within it do not fully understand mense amount of power it gives to the relatively few who and anarchism lack is accountability. This simple con-
it, and the economy is vastly complex set of intercon- govern. Globalism might work if those who had global cept is extremely significant. Those with power, whether
nected systems that is volatile and unpredictable? The power were guaranteed to be omniscent, kind and benef- it is the individual, or the state, require community. They
world has become so complex that most do not even at- icent, such power would corrupt. require a mitigation of their power, for absolute power
tempt to understand the forces that work in the systems It is also likely that such power would dehumanize corrupts absolutely. This simple idea, accountability, is
they live within. It is almost as if those systems are seen humanity. The larger a body of people becomes, the less often lost in the polarized realities of current American
as forces of nature. We complain about them when they human each individual is. To send one person you know culture. On one hand you have the extremely individual-
negatively affect us, but don’t really see anything we can to go die for you is much more difficult than sending istic aspect of pop culture, where a near anarchic state
do about them. fifty thousand you don’t know. Any form of government of mind reigns, and on the other hand you have huge
Most of humanity desires peace and prosperity in re- must create systems to ensure that the humanity of each forms of government, business, and banking that seem to
gard to government and economy, but often have differ- individual is respected. Global power structures (even only answer to themselves. Our entire culture is lacking
ing perspectives regarding how the goals of peace and the ones that currently exist) often do not lend them- accountability from top to bottom, which is to say we are
prosperity can be achieved. When one begins looking at selves to respecting the humanity of the individual, lacking community. We are a lonely people just search-
global realities it seems there is a spectrum of perspec- though they try. ing for peace and prosperity. Unfortunately we are
tives as to how such realities should be governed. On one So we should be anarchist? Some believe so, but this searching in all the wrong places.
end of the spectrum you have the globalists, who want to also is not the answer. Anarchy also has no moral struc- What are the answers to our problems? I am not sure,
create larger structures of government, and those large ture built into it. When there is no law, each man be- but I know one thing that will help with everything from
government structures will affect peace and prosperity. comes a law unto himself, and that extremely individual to global issues: accountability. ★
On the other end you have anarchists, who believe that individualized system would also allow humans to be de-
Mike Finch is an intern for AFP. He has a Master’s degree in journal-
peace and prosperity can only be found in radical indi- humanized. The individual would have all power, and if ism and is working on his Ph.D. in Communication.
vidual choice. Unfortunately both ends of the spectrum all individuals were kind and beneficent this would work,
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