Public
banking will allow local communities to thrive economically under
certain conditions because it will direct money to local and
small-medium businesses. That is, money will not only be invested on
real economy, but also on local real economy.
The
problem is that the Fed that controls currency flow will never permit
municipal banks the privilege of cheap access to national currency
(dollar in the US) because this will end the monopoly of the big
banking cartels, who actually fully control the Fed.
Nomi
Prins worked as a managing
director at Goldman-Sachs for 2 years and as a Senior Managing
Director at Bear Stearns for 7 years, and was a senior strategist at
Lehman Brothers and an analyst at the Chase Manhattan Bank.
She
revealed
that, private banks could access money at no interest. And not only
that. They could use this no-interest to buy Treasury bonds, give
them back to the Fed, and receive a quarter of a point interest from
the Fed!
So, not
only they were getting money effectively free, they were also getting
interest for buying bonds with that money - which is only one of the
activities that they did with that money - and giving it back to the
Fed! Because this was considered an emergency, crisis-related
activity. Now, that still is in effect today. It has become the new
normal.
Recall
also that, ten
years after the last financial meltdown, very few spotted and
mentioned (even until today) an astonishing admission by the
Financial Crisis Inquiry Commission (FCIC). In the conclusions
on chapter 20
of the report we
read that “As
a result of the rescues and consolidation of financial institutions
through failures and mergers during the crisis, the U.S. financial
sector is now more concentrated than ever in the hands of a few very
large, systemically significant institutions. This concentration
places greater responsibility on regulators for effective oversight
of these institutions.”
So, how
could public banking survive and prevail over banking cartels under
these conditions?
Solution
one: people elect a government that is willing not only to break up
the big banks. It will also nationalize the Fed in order to take full
control of the money flow around the country. The money will be
directed to local municipal banks, not to the zombie mega-banks who
play financial games and drive the world into another big financial
crisis that will be paid again by the people. This will also
contribute to a flood of newborn local municipal banks all over the
country that will help the local economies to recover and grow.
Solution
two: local communities ignore the Fed and create their own local
currencies. With the help of the blockchain technology, they could
easily create their own cryptocurrencies backed by the municipal
assets.
Above
all, communities need to create a different structure of
self-organizing, where all citizens will be able to participate
equally, without the corporate-type hierarchy. This will minimize the
risk of corruption and deterioration of the whole project.
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