I started a totally different story today, based on the latest Treasury press room reports about the Borrowing Advisory Committee [aka: the gnome community’s little helpers] which caused me, as usual, to refer to past diggings at EMS News and lo and behold, I come across, in the British archives, another super-secret report written at a key time in history. And it took me off on an entirely new road: the IMF bail out of Britain in 1976 is an important thing to examine closely. For we are on the same road.
February 4, 2009
Report to the Secretary of the Treasury
from the Treasury Borrowing Advisory Committee
of the Securities Industry and Financial Markets Association
It was the Committee’s recommendation that existing monthly 2-year and 3-year notes could be increased by $5 billion in size, to $45 billion and $35 billion, respectively.
Furthermore, the Committee recommends that monthly 5-year notes have the greatest room for expansion given their liquidity and focus and should be increased by as much as $10 billion per issue. This would bring the monthly issuance size to as much as $40 billion.
And lastly, the committee recommends that the Treasury increase the size of the newly issued quarterly 10-year notes by $5 billion and by $4 billion when re-opened the two months following the new issue. In other words, the sizes of the 10-year issuances would increase from $20 billion, $16 billion and $16 billion each quarter to $25 billion, $20 billion and $20 billion, respectively.
The Committee also reviewed the frequency of the relevant issues and reiterates its recommendation to Treasury to issue 30-year bonds monthly, following the pattern of 10-year issuance. In other words, to have a new 30-year bond auction each quarter in February, May, August and November followed by re-openings of that issue in the two months following. The Committee recommends that the Treasury size these auctions to $15 billion, $10 billion, and $10 billion, respectively.
Furthermore, the Committee recognized that the changes were not sufficient to meet its borrowing needs and that the Treasury must introduce new coupon issues to its calendar.
While the number of new issues discussed by market participants, and the Committee, were a 4-year, 7-year, 20-year, and super-long (50-year) maturity issue. Among these choices, the Committee believes that a 7-year issue would be best accepted by the marketplace.
Consequently, after much discussion, the committee recommends that the Treasury announce a new 7-year maturity issue monthly. The pattern and size of the issue is recommended to be $15 billion quarterly, with subsequent re-openings of $10 billion over the following two months.
A number of Committee members noted that despite the tremendous growth in proposed coupon issuance, the average maturity of Treasury debt will likely fall further and that additional changes will need to be discussed by market participants in coming months.
The average maturity of the debt has already fallen from a range of 60 to 70 months which existed from the mid 1980’s until 2002 to a level of 48 months more recently.
What lies in our future? INFLATION! Yes, the Other Goddess. As all the controllers of our economy struggle to keep it running totally out of whack, they use every tool available. All of these tools are destructive if the goal it to keep a totally out of whack system running despite the natural desire of this system to correct itself and regain some balance. The concept of balance has been totally lost. It is a philosophical loss.
If we read many old Federal Reserve speeches by previous chairmen, we hear a great deal about ‘balance’ back in 1950. For example, here is a A 1953 FEDERAL RESERVE SPEECH . Bit by bit, the conversation shifted insidiously. Then, there is the 1961 TOP SECRET FED RESERVE GOLD EXCHANGE REPORT . I found this document while rummaging about in the Federal Reserve document caches. There was still talk in public about balancing budgets, balancing trade and protecting the value of the dollar. But privately, there was talk only about how to engineer an increase in debt and increasing imbalances so the government could spend its way out of what is, in retrospect, a very mild recession.
The success of this scheme triggered the fun sixties where we went to war, expanded the military/industrial complex and ran the Great Society programs. The tremendous success went to everyone’s heads. True, the value of the currency immediately began to nosedive but only in relation to all metals. Swiftly, the coinage was debased repeatedly. First, the silver content began to be reduced. Then, the value of gold had to be admitted: rather than devalue the dollar via gold, Nixon severed the connection and began agitating with Japan and Germany to devalue the dollar only vis a vis the yen and the DM.
Asking for an IMF bailout is among the worst things countries can do in terms of damaging national prestige. It’s the global political economy equivalent of cadging distant relatives (i.e., “the international community”) for money to help tide you over. I’ve covered several of the most recent approaches to the IMF including Iceland,Ukraine, and Hungary. Now, the leader of the British Conservatives, David Cameron, is leading a charge that the United Kingdom may soon go hat in hand to un grand seducteur Dominique Strauss-Kahn. From the Independent:
Britain risks bankruptcy and a humiliating bailout by the International Monetary Fund (IMF) because of Gordon Brown’s borrowing, David Cameron said yesterday. With official confirmation that the economy has entered recession expected today, the Tory leader delivered his strongest warning yet: “If we continue on Labour’s path of fiscal irresponsibility, at some point – and it could be very soon – the money will simply run out.”
His speech to the Demos think-tank in London raised the spectre of the 1976 bailout, when James Callaghan’s Labour government was forced to make deep public spending cuts in return for a £2.3bn loan from the IMF. His remarks are bound to provoke Labour accusations that he is running the country down. Mr Cameron insisted he was not predicting a date by which the Government would “end up back at the IMF”. But he added: “What I am saying is that we are running the risk of those things happening and those are risks that no government should responsibly run.”
The Tory leader added: “We are borrowing, according to the Government’s current estimates, 8 per cent of our GDP in the next financial year. That is the same percentage that Denis Healey [the then chancellor] was borrowing when he went to the IMF in 1976.”
Oh, wow! I found another formerly secret document! This time, addressed to Queen Elizabeth II and the British ministers who serve her! Please note that these things were SECRETS!! How stunning is this? HAHAHA. Before we go down this particularly interesting rabbit hole like Alice in Wonderland, I want to say, how interesting it is, that History loves to repeat the same stories, the same cycles, everything is circular for Her.
She isn’t a power like say, the Goddesses of Infinite and Zero. She is a Watcher. She keeps track of things and if we are really, really careful, we can keep records and then not keep them secret…HAHAHA…and then, using lots and lots of records, we can discern some lessons from experiences in the past! This is called ‘learning things’ and is an important survival tool.
One human peculiarity is our inability to learn from experience. Why is that? Hell, I don’t learn from many of my own experiences! If I could overcome my own failings and foibles, I would be perfect! Alas, neither I nor anyone is remotely ‘perfect’ so we settle for learning a tiny bit from many obvious experiences that should teach us a lesson or two.
The US empire is modeled exactly on the British empire model. The British empire was modeled on the Roman Empire. The US Founding Fathers were so disturbed by the lessons of the Decline and Fall of the Roman Empire they talked about this book and talked about the failures of the Romans a great deal while discussing how to design a fool-proof Constitution that would prevent us from going down that path.
The failure of the Constitution shows us, there is no ‘fool proof’ system possible that fools can’t totally mess up and destroy if they are determined enough to destroy it no matter what. The French Revolution, modeled after the American Revolution, instantly fell into the fallacies of the Roman model and got Napoleon, endless wars and total destruction, all, in less than 20 years!
The top secret documents here are filled with not just economic discussions and not even just discussions about how to militarily oppress distant people who hated the Crown but also, how to kill a proposed ‘Bill of Rights’ for the British subjects who are not citizens of a state but are property of the Crown. Yes, property of the Crown. The British people try hard to pretend that the Crown is not real, and they are the sovereign powers but they are not. They are allowed to vote for political parties which then choose their own leaders. Note how Blair left and Brown took over. Where were the elections?
Anyway, the need to prevent the people from being citizens with sovereign rights is embedded in the secret talks in 1976. All British subjects should read these minutes and weep. You are not free, you have no real power. The US has Civil Rights and the rulers are struggling to eke away these, one by one, insidiously, using the laws, the courts, Congress and Presidents. All of whom have one goal: to strip us of all sovereignty.
Now, on to this important, very private meeting between the Powers or rather, the running dogs of the Powers who were very agitated that Britain was going bankrupt, trying to do guns and butter at the same time:
10 June 1976
1, The Cabinet were Informed of the business to be taken In the
House of Commons during the following week.
THE LORD PRESIDENT OF THE COUNCIL said that the situation
which had arisen In Parliament on the Aircraft and Shipbuilding
Industries Bill was disruptive of the Government’s business, and
especially of the work of Ministers, When it had become known that
the Speaker would rule that this Bill was prime facie hybrid a quick
decision had been needed on what action to take in an unprecedented
situation, but he doubted whether any different line of action would
have avoided the difficulties which had subsequently arisen. The aim
now must be to restore the operation of the usual channels as soon as
possible. There was a considerable number of Government Bills
still to be completed in the House of Commons, and a large number of
Orders requiring Affirmative Resolutions which were needed by the
Summer Recess. Even if the Opposition resumed co-operation they
would remain able to hold up Government business, as they had done
the previous day on the Report Stage of the Education Bill, and some
timetable Motions seemed likely to be necessary, at least on the
Aircraft and Shipbuilding Industries, Dock Work Regulation and
Education Bills, It would have to be made clear to the Opposition in
any discussions on the resumption of co-operation that timetable
Motions might nevertheless be required unless there were under
takings to get the remaining controversial Bills through the House of
Commons in sufficient time. He hoped that the present difficulties
would ease before too long but thought it right to warn the Cabinet that
they might persist for a considerable time.
The aircraft and shipbuilding bill? HAHAHA! Oh, this is wonderful. It illustrates how an empire loses everything. Back then, Britain still held high hopes of being a major industrial power. They ran neck to neck with Germany, France and the US in these industries. Not to mention, Japan. Queen of the Seven Seas, Britain was determined to totally dominate the planet on the air, on the ground and of course, the oceans wide and blue.
WWI and WWII ground down this empire to a small nubbin, didn’t they? By 1976, Britain’s empire struggled to hang onto the last few jewels in the Queen’s crown. One jewel, a very troublesome ruby, was Northern Ireland. The IRA was using terror to fight the Crown and was causing immense troubles which were called, by the Irish people, a very poetic name: the Troubles. Heh. The War on Troubles raged on and on and was wrecking the UK economy and embarrassing the Crown no end.
In the US, Irish descendants were agitation for the US to side with Ireland in these disputes. England’s exploitation of the North Sea oil and gas reservoirs was just beginning. Instead of heralding a new dawn in a re-industrialized England, the oil and gas discoveries led to England becoming Dubai. Just the other day, I detailed how China has slowly insinuated out of England, more and more industries. The latest triumph was to force Airbus to move all of the wing technology and development systems out of Britain and into Chinese hands. Now, the Brits get to attach wings which are totally build, designed and tested in China!
Shipbuilding has totally collapsed. It is now nearly all in Asian hands. The maritime Norse states are still building ships in competition with Asia but England and the US now confine their ship building to military ships and yachts. This is so third world! Boats for fun for the elite rulers and for them to use to kill people. But no boats for commerce! This is a very bad thing, incidentally.
Back in 1976, England still wanted to build boats for commerce and even had secret meetings of the Parliamentary leaders to scheme about it! Soon, the memory of building planes will be as forlorn. Now, back to the 1976 meeting, the talk shifts to the pound. It was being pounded due to the US instituting the floating currency regime two years earlier. The devaluation of the dollar caused all sorts of shifts abroad.
When we look at the numbers back then and compare it with today, two things stand out: the dollar certainly has lost value and with it, all other money on earth has also lost value which is why real coins made of real metals have been vanishing relentlessly and real metals are now worth much more than any paper currencies and now, go through tremendous bubbles whenever the paper system goes into a periodic collapse cycle like the one we are in today.
Back to 1976, this is when it was all just beginning to fall off of its first major cliff. The US stagflation coupled with high energy prices and vacillations in farm prices, the price of gold was beginning its huge climb upwards. And all currencies were swirling in the same toilet bowl, in unison. Britain, being the empire closest to collapse, felt this very much.
3. THE CHANCELLOR OF THE EXCHEQUER said that in the
preceding week the exchange rate had been under serious attack and
on Wednesday 2 June the rate had fallen by 4 cents. He had, with the
agreement of the Prime Minister, broadcast on television on
Wednesday evening in an attempt to reassure the market. As a
result the rate had dropped by only l£ cents on the Thursday and had
risen slightly on the Friday. He had resisted pressure to make
immediate cuts in public expenditure and had, towards the end of the
week, begun to explore the possibility of activating swap arrangements
with the United States and West Germany. At this stage however the
Chairman of the Group of Ten, which consisted of the world’s 8 richest
countries, had suggested a larger operation to support sterling. As
a result a swap facility worth $5.million, involving all countries in
the Group of Ten except Italy, plus Switzerland and the Bank for
International Settlements, had been successfully arranged by Sunday
evening. As a result of his announcement of this facility on Monday
afternoon, the rate had risen the following day by 2^ cents, and then
later In the day by a further 1 cent following the result of the miners
ballot on the second round of the pay policy. On Monday the rate had
been $1.80 in New York, and since then it had fluctuated at a little
above $1,77. ” Of the $2, 000 million which had been made available by the
United States, $1, 000 million came from the Federal Reserve Bank in New
York and $1,000 million from the United States Treasury, partly because
the Federal Reserve Bank was under pressure from Congress not to
arrange swaps too readily, and partly because in an election year the
Bank wished to share the responsibility with the United States
Government, The United States Secretary of the Treasury, Mr Simon,
had been most helpful. The standby credit was not a loan, but a
facility which meant that the additional dollars could be put into the
United Kingdom foreign exchange reserves whenever the Government
wished, but would attract no payment of interest unless spent, at
which point the interest would be at the United States Treasury bill
rate, currently 5^ per cent. The facility was available for three
months, renewable for a further three months, and there were no
strings of any kind attached beyond an obligation, if at the end of the
period the United Kingdom were unable otherwise to repay any
drawings, to go to the International Monetary Fund (IMF) for a
further tranche of borrowing. This meant that the Government need
not consider before mid-October whether they need approach the IMF. i
In his view, if the United Kingdom drew any money under the facility
it should be possible at a later stage to recover this through the
market so that it could be repaid. The standby credit had been made
available partly from a degree of self-interest on the part of the other
central banks – particularly the Swiss, whose exchange rate was going
uncomfortably high – and partly from their confidence in the
Government’s economic policies. In particular, the central banks had
been impressed by the Government’s relations with the trade unions.
The support which he confidently expected the Trades Union Congress
(TUC) on 16 June to give to the latest pay agreement should push up
the rate further.
This sounds all mysterious if one doesn’t read lots of financial materials. The US, in 1961, secretly began to manipulate global gold markets in order to prop up the value of the dollar while inflating it at the same time. But to the great chagrin of Fed and LBJ, the value of metal in coins rapidly surpassed the assigned value and people like me selling them to people who were melting them down to use as pure silver, for example.
In the sixties, I was paid as a babysitter, stablehand, etc, in spare change. I then took these to a local silver smith who paid me by the pound, for the silver. The government began to harass anyone doing this. This was still legal up until recently when an increasingly desperate government has made it increasingly dangerous [versus, outright, illegal] to do this openly. As a child, I used to delight in taking dimes and putting them in front of freight trains so they could be flattened, then punching a hole in them and using them as jewelry. That is ‘defacing’ the coinage. Heh.
The US used its powers to give England a non-loan. We didn’t do this to South Americans, for example, they had to have outright loans and pay interest and if they failed and they always failed, we could then have a bunch of human vultures go down there and strip the place bare of all valuables. Yanqui go home was a popular sentiment.
But England, like Israel, has a ‘special relationship’ with the US. This allows them to kill colonials while begging for more money. Since there were no strings attached forcing either the UK or Israel to give civil rights to these pesky colonials, the Irish or the Palestinians, the US would simply make available enough money to float things along.
Except Jimmy Carter became President in the 1976 election. President Ford gave the Crown of England whatever Parliament wanted, no push to stop the financial bleeding in Northern Ireland or Africa.
Jan. 3, 1977
There remains bitter opposition, but the year saw the beginning of the end of white dominance in southern Africa. Rhodesian Prime Minister Ian Smith, 57, finally bowed to the inevitable and agreed in principle to transfer power in two years to the blacks, who outnumber the whites 22 to 1. Smith would never have given in without the pressure of Henry Kissinger, who made a valiant mission to a continent that he had long neglected. As the colorful and controversial Kissinger cleared out his office, he seemed already to rank among the greatest Secretaries of State.
For most of Europe, 1976 was a year of disappointment and frustration. As Britain and its once proud pound continued to slump, Labor Prime Minister James Callaghan began talking like a Tory; he urged the trade unions to ease off on wage demands and ordered cuts in costly social services. Italy’s Communists under Enrico Berlinguer came closer to entering the government by increasing their vote from 27% to 34%, while the tired Christian Democrats held steady at 39%.
Despite all the gloomy news from Europe, West Germany—by hard work and sensible policies of free enterprise—widened its lead as the Continent’s dominant economic power.
Both Germany and Japan were merrily sailing right past England. Jimmy Carter helped bail out Britain but only if they accepted his new envoy, Mitchell, to get some semblance of civil rights for the Irish Catholics. And an exit from Rhodesia. Back to the secret meetings:
He appreciated that there was, in various quarters, concern over the
size of the public sector borrowing requirement. Although he had no
intention of cutting public expenditure in the current year. Ministers
would need to consider the level of expenditure in future years when
the report of the Public Expenditure Survey was available in July. If
some revision of their plans were needed, they would have to
consider whether these should be made through tax adjustments,
public expenditure changes or other means. Information on the
causes of the recent pressure on the pound was still being collected,
and he would be looking at ways of reducing such pressure, eg by
operating on the sterling holdings, whether through guarantees, or
funding, or the creation of a substitution account at the IMF. On
public expenditure, the 1976 Survey was in train and in the next week
or two he expected to have in his hands the Medium-Term Economic
Assessment, which this year was being done In a radically different,
and more realistic, way than previously. The Short-Term
Economic Forecast would not be available until early July, which
meant that he would not be able to put forward material on the
economic context in which public expenditure decisions would be
needed until about mid-July. In the meantime, it would be most
important to ensure that the public sector expenditure limits for
1976-77 laid down in the White Paper of last February were not
broken, since, if they were, the Government would lose all
credibility. The local authorities had already been told that they
must stick to their agreed target, and Ministers must ensure for their
part that agreed claims on the contingency reserve – on which there
would shortly be a further paper to Cabinet – were similarly
restrained. He asked his colleagues to be particularly cautious in
any public speeches they made relating to the economy, the exchange
rate or to public expenditure, and to ensure that they cleared such
references with the Treasury in advance.
In discussion the following points were made :
a. The exchange rate had received an excessive coverage
in the media In recent weeks, and Its importance had been
grossly over-emphasised by the British Broadcasting
Corporation (BBC) in a way which helped to induce an
unjustifiably nervous state in the foreign exchange market.
If possible. It would be desirable to remind the BBC of its
obligations to the country in these matters, although the
Government had of course no control over the material which
the BBC chose to broadcast.
b. While the situation remained far from assured, June
and July might well be helped by the announcement of good
figures for the Increase In the Retail Price Index (RPI) which,
partly because of the drop In potato prices, would fall to
13£ per cent. Difficulties might arise in the autumn when the
index would be less likely to fall. If it were possible to
arrange reassuring statements on, eg, the public sector
borrowing requirement.then, that might be helpful. On the
other hand, those operating in the foreign exchange market
already appreciated correctly the importance of the public
sector borrowing requirement. They wanted to know that the
Government were concerned about Its size and recognised
the need to reduce it. There could be political advantages in
early action on next year’s borrowing requirement before any
possible recourse to the IMF In the autumn.
c. Although overseas opinion had taken some account of It,
there had not yet been a full appreciation at home of the
significance of the recently announced increase in the United
Kingdom’s recoverable reserves of gas and oil. The
Department of Energy were endeavouring to produce more
telling monthly statistics which would point up the value of
these assets, upon which emphasiB could also be laid at the
Energy Conference later in the month. However, it was
observed that foreign opinion had already taken full account of
the value of the oil and gas reserves, and it was only for tills
reason that the country had obtained help on the scale which
had recently been arranged. The additional resource growth
from North Sea oil and gas would be relatively small.
Like any despotic government, the British government censors and controls the press. In other documents from this file, just glancing at several, I notice the topic of controlling the news comes up regularly. In the US, everything is privatized. The media is owned by the controllers of the government and the prism through which we view the news is slanted tremendously. The internet is slowly eroding this power, of course, mostly due to exposing us to more than one view of reality.
Notice that Britain hoped to gain some economic traction via the oil wells they were in the process of building in the North Seas. This was the basis for public borrowing on international markets. US oil companies had lots of reasons to participate in all of this and heavily influenced US measures aimed at intertwining the US and UK in ever-tighter bonds.
One problem was, Britain was unionized and Labour had to be reeled in. They resisted, at first. This meeting was where Labour discussed how to slither over to the Other Side. At this point, the differences between Labour and Tory is nearly gone. Instead, like in the US, the people get to choose between Tweedle Dumb and Tweedle Dumber. Both want to ‘privatize’ everything and hand it over to the very same humans who run the IMF, the Federal Reserve or the Bank for International Settlements [set up to move US loans to Germany through Switzerland and then to England and France after the whole system collapsed in 1930…by 1934, this collapsed but the Bank lived onwards, as is usual with these things].
The goal was simple: Labour fell into a funding trap. It closed in on them, forcing them to hew to the Real Ruler’s needs and desires. England, in turn, was allowed to accumulate debts. This has continued until today and now, one of the most heavily indebted nations on earth, that is, debts owed to foreign powers, is England. Right on the heels of the US, the other one in the same trap.
THE PRIME MINISTER, summing up the discussion, said that,
although the RPI figures for the next two months would be helpful, and
the outcome of the TUC meeting of 16 June could be expected to assist
the pound, he still felt that for the next six weekB the position would be
fragile. For this reason he would himself resist regarding the
standby facility as a triumph. It would take time to recover from the
difficulties of the last two or three weeks, and the Cabinet would need
to keep their nerve. It would be important to avoid a continuing slide
in the exchange rate which compelled them to make panic cuts in
public expenditure. Such policy adjustments as might be needed
should be considered rationally and sensibly, and if it were possible
for the Chancellor of the Exchequer to accelerate any proposals he
contemplated putting forward this would be desirable. The country
still had a difficult 18 month s to two years ahead of It, and he felt sure
that the Labour Party would understand and accept this If the truth
were put frankly. He underlined how important it was that all
Ministers should comply with the Chancellor of the Exchequer’s
request to clear with the Treasury in advance any speeches they might
make touching on the economy.
Lord forbid, any of these conspirators were to blurt out the truth! People wonder why our leaders and other creatures sound so stupid. It is simple: they are lying! They alway lie! They must lie! I don’t have any restrictions…so far. So I can attempt to explain what appears to be the truth. At least, I have no motivation to lie. The Chancellor of the Exchequer basically was dictating terms to the Prime minister. He hoped, so long as this was all kept strictly secret, Labour would morph into the Tory party while talking as if they were still Labour. And the Chancellor would be silent while they did this balancing act.
None of these moves fixed what was ailing Britain. The relations of labor to management was totally poisonous. The battle for a piece of the capitalist profits was long and very violent. Just like the occupation of the colony of Ireland. Indeed, these matters were very much intertwined.
4. The Cabinet had before them a minute, dated 28 May, from the
Home Secretary to the Prime Minister, to which was attached the
text of a discussion document on human rights.
THE HOME SECRETARY said that the Cabinet, on 25 March, in the
context of a threatened Motion by Lord Hailsham to refer to a Select
Committee Lord Wade’s Bill of Rights Bill, agreed to the publication
of a discussion document on human rights based on the report of an
interdepartmental working group which was already available. The
text of the proposed discussion document had been fully considered
by the Home Affairs Committee which had agreed that, subject to a
small number of amendments which would appear in the final version
now being printed, it was suitable for publication. The document
was neutral in tone and neither entered into any commitments nor
favoured any particular solution, and would, in his view, make a
useful contribution to calm and informed debate of the issues involved.
THE LORD CHANCELLOR said that public interest in legislation to
protect human rights had been stimulated by the publication of a
Labour Party discussion paper on human rights and by Lord Justice
Scarmants advocacy of a Bill of Rights. He did not believe that
Lord Justice Scarman’s views were representative of judicial opinion
nor were they of his own since he took the view that human rights were
already better protected in the United Kingdom than anywhere else and that
it would be wrong to transfer Parliamentary responsibility for their pro
tection to the courts. Nevertheless he agreed that publication of a
discussion document in the neutral terms proposed would serve a valuable
purpose provided that the document was published merely to assist
discussion and not for the purposes of consultation which might lead to
In discussion, the view was strongly expressed that changes of the
kind analysed In the document would be highly undesirable and make
no contribution to the creation of a more just society. The changes
had constitutional implications of a revolutionary character: they
implied a written constitution which might or might not be entrenched
but which would entrust to the courts decisions which were
essentially the prerogative of Parliament. Chapter 3 of the document
illustrated the range of sensitive issues on which the courts might have
to pronounce; even without domestic legislation, there was already a
possibility that judgments of the European Court of Justice on cases
brought under the Convention on Human Rights might undesirably
restrict Parliamentary sovereignty. On the other hand, it was
argued that no-one in the United Kingdom could afford to take a
complacent view of the adequacy of the existing protection of human
rights. It was a very live issue in Northern Ireland where the
Standing Advisory Commission on Human Rights was engaged in a
study of the adequacy of existing legislation and where there were
strong grounds for making some change; and, although the special
circumstances of Northern Ireland’should not be allowed to influence
constitutional decisions elsewhere, a number of minority and under
privileged groups in the United Kingdom as a whole did not see their
rights as being adequately protected by Parliament.
THE PRIME MINISTER, summing up the discussion, said that given
the commitment, which had been made in both Houses of Parliament,
topuhUnh a discussion document on human rights, the Cabinet agreed
that the text circulated by the Home Secretary, subject to the
amendments which the Home Affairs Committee had approved and
which would be incorporated in the printed version, was sufficiently
neutral in tone and was suitable for early publication. The
presentation of the document should be in a low key and should imply
no policy commitment or intention on the part of the Government to
take decisions. On this basis it would be open to Ministers to
express their individual views in any public debate of the major
constitutional issues raised in the document.
By November, 1976, Britain was engaged in negotiations with the IMF for a bail out loan. During this time, the Crown was fighting a two-front war at opposite ends of the Empire: in Ireland and in Rhodesia, aka, Zimbabwe, the land of the non-currency. So while the Empire struggled to keep hold of colonies that were going through uprisings, it needed to borrow money! As if it were some third world nation. Note that at no point, did the Queen give up her holdings, crown or palaces.
The IMF demanded and got important things: the cutting of social services inside Britain. But did it stop the oppression of the Irish? HAHAHA. No empire ever loses its grip on colonies unless the jaws are pried open via great violence or total boycotts by trade partners. I am now totally off topic!
But this is how reality works. Britain was not going to get any damn Bill of Rights because that would interfere with the Crown and a host of Ruling Elites who were not British at all. But wanted the status quo to be kept there. For nothing is a worse danger to their power than any ‘Bills of Rights’ and the existence of one in America is a major irritant with them. They want a Bill of Privileges.
Neither England nor Israel have Bills of Rights. They have Bills of Privileges. Anyone who rises to the top of either system gets the entire glory of these privileges so there is hot fighting to rise to the top. But this immediately severs all connections with the bottom. Whether it be a Dame Thatcher of a Lord Blair, they rise into the ‘sub-nobility’ and thus, get noble privileges. Generally speaking, within three generations, this peters away to nothing.
Unlike ‘real’ nobility which clings to the marriage bed to gain social and economic powers. Only executions due to revolutions, slows down this class. Which, even when poor, retains full access to all privileges.
Now, after this long, long detour, let’s go back to the original story here about the US Treasury issuing a report that talks about basically expanding the debt markets so we can pay for the financial collapse caused by international financial wizards using English crown islands to run Japanese carry trade loans into the US financial system at the same time Greenspan flooded the US with easy credit and Congress dropped all rules and restrictions to lending, speculation and trade:
The expansion in quasi-government paper contributes to the risk of market saturation. Banks have issued nearly $150 billion in FDIC-backed paper since the programs introduction. Spreads on this paper have been narrowing over time with the latest deal, paper offered by Citi, pricing just 30 basis points over Libor. Real money investors have purchased the bulk of this paper in an attempt to pick up yield over Treasurys while not taking on additional credit risk. In some respects, this paper has replaced GSE debt as the instrument of choice for real money investors looking for modestly higher yielding, quasi-government debt.
Surging sovereign debt (and sovereign-insured private sector debt under programs instituted by some European governments) outside the United States also could compete with Treasury securities but this seems a modest risk at this point. The dollar remains the world’s reserve currency and in periods of uncertainty and volatility typically enjoys a safe-haven bid. Indeed, the demand for dollar – including US Treasury debt – has been solid in recent months even though US policymakers have announced their intentions to expand fiscal and monetary policy. Moreover, the ratio of public sector debt in the US – even with the pending surge – will remain below that of many other developed countries, as the ratio will be rising from a relatively low base.
Nonetheless, international developments do pose some risk to the Treasury market, especially as the increase in supply accelerates further. Foreign investors currently hold nearly 55% of the marketable Treasury debt outstanding – a percentage that is only modestly higher than some other G10 economies – and a percentage that has been trending higher since early this decade. For instance, foreigners held about one-third of Treasury debt outstanding in 2000. Japan, China, and the United Kingdom are the three largest holders. Yet, the UK’s elevated position reflects London’s status as a global financial center and the large concentration of hedge funds in London, and is less relevant for debt management issues than Japan and China.
Japan and China both maintain outsized official holdings of Treasurys. The Japanese Ministry of Finance is not typically a net seller of dollars for anything beyond very minor portfolio rebalancing. In the current environment, Japanese officials may be more inclined to buy dollars (sell yen) in an effort to stem upward pressure on the yen, thereby halting Japan’s terms of trade deterioration. Of note, however, the Ministry of Finance has not intervened recently.
China, on the other hand, could slow its accumulation of dollar-denominated debt. Such a trend already has begun to develop with respect to its accumulation of overall dollar assets as the flow of private capital into China has cooled alongside the global downturn, alleviating the need to offset capital inflows.
Now, I have talked about all of these things for years. The fact that this Treasury document says the obvious is interesting. Already, the change over to the Obama administration is showing. Unlike in the past, where the business about the yen was ignored, here, they state the obvious: the Japanese want a cheap yen so they can have one-way trade! Only, the Treasury document doesn’t call this a hazard but rather, accepts this as natural!
THIS IS TOTALLY UNNATURAL AND THE US SHOULD BE FIGHTING THIS TOOTH AND NAIL.
This is ideological: I read these words from our own government and grind my teeth in fury. Japan doesn’t have a trade deficit. They are in trouble right now due to the fact that they have killed their domestic economy while using trade as a tool to enrich a tiny elite of Japanese so they can control the world. But they goofed. A mistake China is intent on not making.
Secondly, the US has a lot more debt held by foreigners, not just US government debts but all our debts. Japan has very little held by foreigners. They don’t allow this. And the US trend has been worsening. And in the last 5 years, around 87% of new debt was sold to foreign powers.
Then there is the issue of hedge funds buying our debts: they are parasites and germs which kills the body that is invaded by them. Note that Iceland is now dead. Ireland is dying, Scotland is in bed and Britain is coughing up blood. Not a good thing, I would suggest with some dry irony.
On top of all this, how can the entire first world accumulate and indeed, tremendously accelerate the accumulation of public debt in a world where oil prices have plunged? We need someone with ‘sovereign wealth’ to be the basis of this inverted pyramid scheme! Without that, all fails! And all is failing. This is why are are all so alarmed, the entire financial system is collapsing. The IMF can’t bail out the US, for example, the sums needed are pretty much identical in size to the combined Japanese and Chinese FOREX reserves…yikes! Wait! I see something here! Oh no! Next: page two of today’s news. Scary graphs and charts!
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