Usury,
once a venal sin, was now commonplace and bankers who live by the charging of
interest were considered respectable. The hand of evil was everywhere as the
end-times, the end of days, were upon them.
Rolling Stone
writer Matt Taibbi’s description of Goldman Sachs as a Giant Vampire
Squid which wraps itself around its victims draining them of their
productivity and profits is chillingly accurate.
In truth, Matt
Taibbi’s Giant Vampire Squid was created in the recesses of 17th
century London,
for Goldman Sachs is but one of many; but, unlike Frankenstein’s
monster, the Giant Vampire Squid is not a fable. It is as real as are its
appetites and victims; and, although now badly wounded, the Giant Vampire
Squid is still alive—and it’s headed east.
Taibbi’s
metaphor is an apt description for modern banks, especially investment banks
such as Goldman Sachs, JP Morgan Chase, Deutsche Bank, Credit Swiss, RBS,
etc. Allowed by governments to create capital from virtually thin-air, these
banks have an in-house advantage in a world dependent on credit, an
advantage they use to leverage the world’s need for money into profits
and obscene bonuses for themselves.
Banking is
simple. We profit by the indebting of others by taking advantage of their
need for money. We do this by creating money from nothing using the savings
of others to do so.
The Dark Arts:
The Secrets of Banking, 14th ed.
the FEEDING mechanism OF THE Giant Vampire Squid
The feeding
mechanism of the Giant Vampire Squid is simple. First, it expands the size of
its victim by injecting it with credit through its beak. Over time, this will
enlarge the victim to its maximum possible size.
This mimics the
nurturing process in nature. But the Giant Vampire Squid’s intent is
singularly self-serving. At first, the victim enjoys the squid’s
credit, absorbing as much as possible. The victim experiences the increased
growth as pleasant and positive; and so it is—but ultimately only to
the benefit of the squid.
The victim,
enlarged to its maximum size and thoroughly entwined by tentacles, the Giant
Vampire Squid then begins its deadly cycle of extraction, a protracted
process that accelerates over time.
The Giant Vampire
Squid possesses a rudimentary but highly sensitive extraction system alerting
the squid to start the extraction process at the most advantageous time,
indicating also the maximum amount that can be extracted and the most
efficient way to do so, i.e. sovereign debt, mortgages, initial public
offerings, leveraged buy-outs, consumer credit, bankruptcy, etc.
Inevitably, the
victim begins to shrink as the extraction process has a debilitating effect
over time. In some instances, speculative bubbles appear, nex ebullio,
a sure sign of the victim’s approaching demise. The process can take
years, even decades—or it can happen overnight.
Eventually, the
victim, now shrunken and depleted and almost unrecognizable, its productivity
and profits completely leached, its future if it ever existed encumbered
beyond redemption, expires.
The life cycle of the giant vampire squid
The Giant Vampire
Squid is a member of the family Architeuthidae, but unlike its
biological brethren, the Giant Vampire Squid is also a parasite that, unlike
others, dies when its host dies. To survive, it must always find another host
before its present host expires.
The Giant Vampire
Squid’s first such crisis occurred when England
could no longer expand fast enough to support the Giant Squid’s rapid
growth. As its victims expand, the Giant Vampire Squid expands also and, at
the time, the Giant Vampire Squid needed another victim as its then host, England,
was no longer expanding.
The United
States of America was to be the perfect replacement for England.
At the end of the 19th century, England’s
empire was shrinking while America
was on the verge of great industrial growth.
With little debt
and much potential, the US
fit the exact profile of the Giant Vampire Squid’s perfect
victim/host—and it was. In less than 50 years, due to the squid’s
continuous injections of credit, the US
would expand to become the richest most productive country in the world, only
to be bled completely dry by the Giant Vampire Squid in a few short
decades—just as America’s
founding fathers had warned.
Through its beak,
the US Federal Reserve Bank, the Giant Vampire Squid increased US
debt by an extraordinary 4,000 %, from less than $3 billion to over $12
trillion, by leveraging then draining the wealth of the world’s once
strongest economy.
When the American
economy collapsed in 2007, it almost destroyed the Giant Vampire Squid in the
process. Only a massive emergency infusion of capital in 2008 would save it.
TARP didn’t save America.
TARP saved the Giant Vampire Squid.
Despite causing
the collapse of the US
economy, bankers inside the US
government insured the squid would survive. Trillions of dollars in US
aid were directly given to Wall Street banks resuscitating the giant squid
from certain extinction.
TARP had enabled
the Giant Vampire Squid to survive its greatest crisis since the 1930s; and,
now, although badly wounded, its short-term survival is assured—but
only as long as its host survives too.
The collapse of America’s
economy reawakened the conundrum of parasites such as the Giant Vampire
Squid, i.e. when its present victim has been completely drained of its
wealth, another host must be found or it will die.
Today, its
current host, the US,
is fighting for survival as it succumbs to insurmountable levels of
squid-induced-debt, SID. Its manufacturing base now transferred to China, its
savings now replaced by IOUs, its future so encumbered it can never be paid,
the US is now living on borrowed time and borrowed money—and the squid
knows it.
The search for a
new host is on.
THE EAST
BECKONS—or does it?
The West, now
indebted and drained of its wealth by the Giant Vampire Squid, is no longer
its optimal venue. The emerging markets in the East with their high savings
rates and largely untapped markets look to be its next victim—or at
least appear to be so.
The West’s
view of itself is Western-centric. This is natural. It is also natural that
the East’s view of the West is Eastern-centric. It is a view, however,
that is far less kind than the West’s own view of itself.
To the East, the
West is the Giant Vampire Squid incarnate. Originating in London
in 1694, spawned by banks and government, the Giant Vampire Squid immediately
headed East in the 1700s to take the East’s riches for itself.
India
especially beckoned the Giant Vampire Squid. For 15 centuries prior to the
Giant Squid’s arrival, India is estimated to have had the largest
economy of the ancient and medieval world controlling between one third and
one fourth of the world's wealth up to the 18th century.
http://en.wikipedia.org/wiki/History_of_India
But after the
Giant Vampire Squid’s arrival, everything changed. It would do well for
those enamored of the West’s “free trade” to acquaint
themselves with the actual origins and use of the concept.
“Free
trade” was used by the West to forcibly extract trade concession from
the East in order to profit; and, while those in the West don’t
remember it as being so, those in the East do.
In Opium Wars I
(1849-1842) and II (1856-1860), the British East India Company used the cover
of “free trade” to force China
to allow the importation of opium; just as previously the East India Company
had forced upon India
“free trade permits” in Bengal
province.
Bengal
was the first major area conquered by the [East
India] Company. Its army defeated the native ruler in 1757,
and proclaimed itself the official ruler of Bengal
in 1765. It imposed incredibly harsh taxes. The province deteriorated
rapidly. In 1770, the failure of monsoon rains, led to a famine in which an
estimated one-third of the population perished…Bengal
then became the center of the East India Company's opium monopoly…The
East India Company's domination of the Indian economy was based on its
private army. However… the ultimate muscle behind the company was the
British military, as Lord Palmerston demonstrated by deploying it in the
Opium Wars, to back up the British demand for ``free trade…the
``free-trade'' East India Company was, effectively, a semi-official branch of
the British government
Robert
Trout, The Chinese Opium Wars, American Almanac July 1997
http://american_almanac.tripod.com/opium.htm
Free trade in
actuality was but a cover for the Giant Vampire Squid as it moved East in its
quest for world dominion. Communism was the East’s flawed,
dysfunctional and self-destructive attempt to resist it.
The merits of
free trade depended on whether you were advantaged or disadvantaged, strong
or weak, the victim or the victimizer.
PROPHYLAXIS AND the Giant Vampire Squid
The power of the
Giant Vampire Squid is found deep in its genesis where it was formed by the
hand of man to grow into the monster it is today. Its power came when England
allowed the Bank of England’s banknotes to be considered as good as
gold and silver.
Of course they
weren’t. They never were. But with the sanction of the government, the
paper banknotes were accepted as money, guaranteed that they were convertible
to gold and/or silver upon demand. A fine promise but, in the end, only a
promise, a promise today that is no longer made as it can no longer be kept.
The paper, however, keeps passing.
The global
monetary system is now completely infected with the Giant Vampire
Squid’s debt-based banknotes; and, consequently, a global financial
crisis is now in the making. In fact, it has already begun.
It is ironic that
Martha and I are in engaged in parallel businesses designed to protect those
at risk in today’s world—from AIDs and paper money. Our
condom company, Mr. Happy’s Hat, www.mrhappyshat.com exists in part
because of the threat posed by the spread of the HIV virus, a threat very
much equal to that posed by the Giant Vampire Squid and the spread of its
paper money.
Whereas the use
of a condom will suffice in the case of HIV to protect those potentially at
risk, the prophylaxis in the case of the Giant Vampire Squid is gold and
silver, throughout history the only known antidotes to a potentially fatal
overdose of fiat money.
The price of
gold, in fact, is a direct measure of the Giant Vampire Squid’s current
distress. The price of gold is now over $1100, a very high number especially
considering the squid is a cold-blooded creature, e.g. Goldman Sachs. Today,
the Giant Vampire Squid is in serious trouble—and so are its victims.
Professor Antal
Fekete has just announced his spring seminar will be held March 25-29 in Hungary.
Is the Global Financial Crisis Really Over? will be the topic. Those
attending will have the opportunity to hear and meet the esteemed professor,
a monetary apostate in a time of paper money, albeit one who has delivered
papers to audiences that included Nobel Prize winner Robert Mundell and
former Fed chairman Paul Volker in the past year. For event details go to http://www.professorfekete.com/gsul.asp
I also will be
attending and giving a talk. My topic will be The Giant Vampire Squid and
its Reception in the East.
Buy gold, buy
silver, have faith.
Darryl Robert
Schoon
www.survivethecrisis.com
www.drschoon.com
Also
by Darryl Robert Schoon
|