Before It’s News – by Tom Dennen
How did Banks get “Too Big to Fail, Too Big to Jail” and How Soon Will they be Too Big to Tax? Hint – They Started 3000 Years Ago as Monylenders in the Temples… and they arevery patient.
The secret was an overwhelmingly convincing demonstration 400 years ago in Holland that showed how greed among the middle classes could be controlled through specific forms of financial manipulation over and above predatory lending and other practices the demonstrators – money lenders – had already perfected over eons.
We may very well see the day when Uncle Sam spends more money pandering to big companies than it receives from taxing them.In the past half-century, corporate tax dollars have plunged as a percentage of the economy and as a share of total federal revenue. The effective corporate tax rate is less than half of what it was just a few decades ago and now hovers at 12.6 percent, roughly one-third of the official 35 percent rate
.jpg?w=960)
.When Corporate America Gets Too Big to Tax, an OtherWords Cartoon by Khalil Bendib
Calls to slash the corporate tax rate, or even scrap this tax altogether, span the political spectrum. Proponents justify this on the basis of “tax competition,” the battle among nations to attract giant corporations or discourage their departure.The term “tax competition” is a euphemism for a race to the bottom among nations in both the developed and developing world.
Each country slashes its corporate income tax rate in an attempt to lure multinational corporations to base their operations there, or at least dissuade corporations already based there from relocating.The idea behind reducing or eliminating the U.S. corporate income tax, then, is simply a tactic to win the race to the bottom. Reduce the corporate income tax rate in the United States, or drop this tax altogether, and the exodus of multinational corporations from America will stop and even flip. If we shrink the corporate income tax rate to zero, the logic goes, no country can outbid us.
Or can they?
READ MORE HERE AND THEN Take a look a the history of banking;
THE crippling practice of ‘Usury’ – lending money, raising interest rates on the loan and then lending more money to pay off the interest – can be traced back more than three thousand years, from which time it has always been despised, condemned, restricted or banned by moral, ethical, legal and religious bodies, including ruling governments..
That is, governments up to the middle of the 17th Century, when governments suddenly changed.
Why did governments stop legislating against Usury at that time?
There was another way to fleece the Middle Classes besides Usury : the government of Holland – along with selected rulers from all over Europe – were treated to a well-kept secret – a secret developed after war between Venice and Genoa resulted in suspension of rising interest rates on equity loans in the early 1380s.
When the market was restored, it was
.jpg?resize=221%2C296)
at a lower interest rate and Venice’s bonds traded at steep discounts for decades thereafter. Other blows to financial stability resulted from the Hundred Years War, which caused monarchs of France and England to default on debts to Italian banks, and the Black Death, which ravaged much of Europe.
Still, the idea of debt as a tradeable investment endured.
As with bonds, the concept of stock developed gradually. Some scholars place its origins as far back as ancient Rome and others back to ancient Greece to the philosopher Thales, who, knowledgeable about the Solar system’s influence on local weather patterns, figured one year that the seasons were going to yield a large olive crop, so he rented and bought all the olive presses he could find to corner the olive oil market, making him a great deal of money when the crop came through.
Aristotle says Thales did not do this for the money, which he saw as a distraction from his astronomical studies, but to show the skeptical Milesians that abstract speculation can yield worldly results, and so philosophers can get rich but they are more interested in gaining knowledge and wisdom.
Partnership agreements dividing ownership into shares date back at least to the 13th century, again with Italian city-states in the vanguard. Such arrangements, however, typically extended only to a handful of people and were of limited duration, as with shipping partnerships that applied only to a single sea voyage.
The forefront of commercial innovation eventually shifted from Italy to northern Europe. The Hanseatic League, an alliance of mercantile cities such as Bruges and Antwerp, operated counting houses to expedite trade.
By the late 1500s, English merchants were experimenting with joint-stock companies intended to operate on an ongoing basis; one such was the Muscovy Company, which sought to wrest trade with Russia away from
Hanseatic dominance.
The next big step occurred in the Netherlands. In 1602, the Dutch East India Company was formed as a joint-stock company based in six locations with shares that were readily tradable. The stock market had begun, but since stocks were not allowed to be traded with multiple addresses for a company, the stocks were redesignated as coming just from Amsterdam.
The secret was overwhelmingly convincing demonstration that greed among the middle classes could be controlled through specific forms of financial manipulation over and above the predatory lending and other practices the demonstrators – money lenders – had perfected over eons.
(Early goldsmiths had always been removed from every society in which they set up usurious lending practices until this demonstration four hundred years ago – See Tacitus below).
That demonstration was I believe actually an experiment, not an anomaly. It is called ‘Tulip Mania’ today, still an unexplained economic mystery, although it is acknowledged by some as the first stock market ‘Pump & Dump’ operaton in history.
So, as far as mknow, this is the first serious attempt to unlock the ‘Tulip Mania’ mystery by giving it a plausible context and mhope it spurs further research, although from now on, mam going to regard – and write as if (my interpretation) is the truth until a better one comes along.
Here is an abstract from a UCLA paper by Earl A. Thompson and Jonathan Treussard on what we understand about it today:
“The famous tulipmania, which supposedly saw the price of a single tulip bulb rise to the value of a luxury house in 17th century Amsterdam, was an artifact created by an implicit conversion of ordinary futures contracts to option contracts in a largely failed attempt by several Dutch burgomasters to bail themselves out of previously incurred speculative losses in the normal, fundamentally driven, market for Dutch tulip futures.”
Well, artifact mbelieve it certainly was (and the language is as dutifully complicated as the language of anything we really don’t understand is, like economics!)
In the early 1600s The Dutch started joint stock companies, which let shareholders invest in business ventures and get a share of their profits – or losses.
In 1602, the Dutch East India Company issued the first shares on the Amsterdam Stock Exchange. It was the first company ever, four hundred years ago, to issue stocks andbonds. In 1688, the trading of stocks began on a stock exchange in London.
mdon’t know who might supply the answer to the question, “where did that idea come from?” but mmake guesses based on my own speculation which mcall Encompassing The Historian’s Opinion through Study – (ETHOS).
(BTW, like any craze, tulip mania came to an end. As more people started to grow their own tulips prices began to drop, investors raced to sell, resulting in an economic depression that still serves as a warning today – “bet on fashions, not trends” – George Soros…
My ETHOS says that goldsmiths may have become tired after thousands of years of back-to-back forced removals, and so opened their free money trough in Amsterdam to ‘invited guests only’, introduced them to the concept of stock market manipulation, showed them exactly how to control markets – with tulips! to prove beyond doubt that it could be done with any commodity – and then got down to the business they are in today, starting with the first massive ‘transfer of wealth’ with the South Sea Bubble.
My ETHOS also tells me that all the other money-siphoning structures, from predatory lending to inflating property bubbles (or dot com bubbles or subprime bubbles ) to war profiteering (making money by killing people and destroying resources) were introduced by these control addicts.
Is there another explanation for a world wracked, twisted and enslaved by such a simple thing as debt?
My ETHOS can’t find any, but in my search so far, all roads lead straight through the open door of Amsterdam down the time line to the early goldsmiths.
This is what happened in Rome when goldsmiths took over its banking system: from the original Investigative Journalist, Gaius Tacitus around 27 A.D.
“Meanwhile a powerful host of accusers fell with sudden fury on the class which systematically increased its wealth by usury in defiance of a law passed by Caesar the Dictator defining the terms of lending money and of holding estates in Italy, a law long obsolete because the public good is sacrificed to private interest. The curse of usury was indeed of old standing in Rome and a most frequent cause of sedition and discord, and it was therefore repressed even in the early days of a less corrupt morality. First, the Twelve Tables prohibited any one from exacting more than 10 per cent., when, previously, the rate had depended on the caprice of the wealthy. Subsequently, by a bill brought in by the tribunes, interest was reduced to half that amount, and finally compound interest was wholly forbidden. A check too was put by several enactments of the people on evasions which, though continually put down, still, through strange artifices, reappeared. On this occasion, however, Gracchus, the praetor, to whose jurisdiction the inquiry had fallen, felt himself compelled by the number of personsendangered to refer the matter to the Senate. In their dismay the senators, not one of whom was free from similar guilt, threw themselves on the emperor’s indulgence. He yielded, and a year and six months were granted, within which every one was to settle his private accounts conformably to the requirements of the law.
Hence followed a scarcity of money, a great shock being given to all credit, the current coin too, in consequence of the conviction of so many persons and the sale of their property, being locked up in the imperial treasury or the public exchequer. To meet this, the Senate had directed that every creditor should have two-thirds his capital secured on estates in Italy. Creditors however were suing for payment in full, and it was not respectable for persons when sued to break faith. So, at first, there were clamorous meetings and importunate entreaties; then noisy applications to the praetor’s court. And the very device intended as a remedy, the sale and purchase of estates, proved the contrary, as the usurers had hoardedup all their money for buying land. The facilities for selling were followed by a fall of prices, and the deeper a man was in debt, the more reluctantly did he part with his property, and many were utterly ruined. The destruction of private wealth precipitated the fall of rank and reputation, till at last the emperor interposed his aid by distributing throughout the banks a hundred million sesterces, and allowing freedom to borrow without interest for three years, provided the borrower gave security to the State in land to double the amount. Credit was thus restored, and gradually private lenders were found. The purchase too of estates was not carried out according to the letter of the Senate’s decree, rigour at the outset, as usual withsuch matters, becoming negligence in the end.
Rome? Sound more like Wall Street.
As an investor, you need to be smart about where you’re putting your money to work. Investing your hard-earned cash in companies that won’t use it well — or in products that haven’t proven themselves — can quickly come around to bite you. Case in point? These 10 famous examples of investment gone horribly wrong:
1. DeLorean Motor
Marty McFly’s time-traveling adventures weren’t the only juicy story featuring the futuristic DeLorean. The inventor of the car with cool side-opening doors from “Back to the Future“ was caught on tape during an FB msting declaring the suitcase of cocaine he planned to sell was as “good as gold.” The cocaine, worth $24 million, was John DeLorean’s last-ditch attempt to save his floundering company from financial ruin. This (combined with charges of defrauding his partners) lost all trust he had with investors. The firm filed for bankruptcy in 1982. (An unrelated company using the same name services the 9,000 cars made.)
2. The Dutch Tulip Craze
In the 1630s, the Dutch were flying high on the flowers recently introduced from Turkey. Tulip bulbs became a highly sought-after commodity, with one bulb going for the equivalent of an entire estate. Many investors got so excited that they sold everything they had to get in on the deal. But, like any craze, tulip mania came to an end. As more people started to grow tulips and prices began to lower, investors raced to sell, resulting in an economic depression that still serves as a warning today.
3. Charles Ponzi
The famous swindler, whose name is now synonymous with scams, did his dirty dealings back in the 1920s. Cashing in on people’s desire to get rich quick, Charles Ponz mwasn’t the first to run a pyramid scheme, but he was the first to get so good at it people took notice. His racket involved enticing investors to buy discounted foreign postal reply coupons, which they could redeem at face value for U.S. postage stamps. Using money from new investors to pay existing investors, Ponz mpocketed millions for himself before the whole thing collapsed, costing investors around $20 million.
4. Bernie Madoff
Speaking of Ponz mschemes, former Wall Street stockbroker Bernie Madoff was behind one of the biggest in U.S. history. For decades, his investment firm defrauded its clients, fudged the numbers and cost an estimated $20 billion to investors. Pleading guilty to 11 federal felonies — including securities fraud, investment fraud and money laundering — Madoff is the prime example of investing gone horribly wrong.
5. Washington Mutual
The biggest bank failure in history, according to assets, Washington Mutual won its spot in the list of infamy when it went out of business and was purchased by JPMorgan Chase (JPM) in 2008. Once the sixth-largest bank in America, it fell the furthest during the subprime lending fiasco, resulting in its seizure by the Federal Deposit Insurance Corp. and bankruptcy. Total lost assets? Around $300 billion.
6. Enron
Energy, commodities and services company Enron seemed to be on top of the world. With (claimed) revenue in the hundreds of billions, it was consistently named “America’s most innovative company” by Fortune – until it came to light that its success was based on fraudulent reporting. It hid massive debts from its balance sheets. Now one of the best-known examples of corporate fraud, greed and corruption, Enron lost its shareholders their retirement accounts, their jobs and $74 billion.
7. Lehman Brothers
Global financial services firm Lehman Brothers is another example of shaky reporting (to put it kindly). It hid more than $50 billion in toxic assets in the Cayman Islands from its balance sheets by disguising them as sales, making them look instead like $50 billion in cash. When the subprime mortgage crisis hit in 2007, Lehman Brothers was forced into bankruptcy and acquired by Barclays (BCS) and Nomura Holdings (NMR).
8. Premier Smokeless Cigarettes
Long before today’s e-cigarette trend, R.J. Reynolds Tobacco (RAI) attempted to eliminate some nasty side effects of smoking with its Premier smokeless cigarette. This “nicotine delivery device,” made to look like a cigarette, flopped when it was found to have a horrible charcoal aftertaste and to be a convenient method of delivering substances other than nicotine to smokers. Less than a year after its 1988 release, it was pulled from the market — after costing nearly $1 billion to develop.
9. Pets.com
It had an adorable sock spokes-puppet and a ton of high-profile commercials, but Pets.com didn’t manage to cash in on the dot-com bubble. The online pet supplies retailer rapidly gained attention with spots on the Macy’s Thanksgiving Day Parade and the Super Bowl, but with no solid market to purchase the products it advertised, it quickly found itself losing money. In spite of $300 million in investment capital (largely spent on advertising), it failed after two years.
10. WorldCom
Once the second-biggest long distance phone company in the U.S., WorldCom (also known as MC mWorldCom) was once seen as one of the great telecom success stories of the ’90s. But when it tried to continue its growth-by-merger strategy by joining with Sprint (S), it was blocked by regulators as an attempt at monopolization. When it came to light that CEO Bernie Ebbers was financing his other businesses with personal loans from his WorldCom stock (to the tune of $360 million), things unraveled further. WorldCom filed for bankruptcy in 2002, resulting in an $11 billion loss to investors.
A good source:
Paula Pant ditched her 9-to-5 job in 2008. She’s traveled to 30 countries, owns six rental units and runs a business from her laptop. Her blog, Afford Anything, is a gathering spot for rebels who refuse to say, ” mcan’t afford it.” Visit Afford Anything to learn how to shatter limits, build wealth and live life on your own terms.
“THE crippling practice of ‘Usury’ – lending money, raising interest rates on the loan and then lending more money to pay off the interest – can be traced back more than three thousand years,…”
To the ancestors of the authors of the NWO.
Jesus, break out the whip.
Molon labe