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  1. #1
    Join Date
    Oct 2008


    The Rat Race Part IV – The Pyramid.

    Segment 1: The Pyramid

    Segment 2: Who Controls the US?
    Segment 3: The Rat Race Revisited
    Segment 4: How do they do it?


    THE RAT RACE PART I: WE ARE DOING WELL! was a wake up call.
    THE RAT RACE PART II – THE SYSTEM was an introduction to the System.
    THE RAT RACE PART IIIA - HOW THE SYSTEM WORKS? provides of an explanation on the working of the System.
    THE RAT RACE PART IIIB: MENTAL MODEL NO. 2 – THE CIRCLE describes how we are manipulated in our day-to-day life.

    Many people grow up accepting it as a way of life. (In many religious societies, the oppressed are taught to believe that this is ordained by God or it is their fate - Karma! We can see examples of this in India with the caste system and in Tibet before China took over, where feudalism and serfdom was rife.)

    The ideas presented in the Rat Race Series are merely ideas. Readers are encourage do their own research to check. The mental model proposed is flexible and can be modified to suit new information. Use it only if it makes sense to you.

    The Ruling Class at the apex of the Pyramid see themselves as the owner of all the resources in a state, … including the Rats. (In the earlier articles, we referred to them as the Exploiter) The Rats are also regarded as a potential enemy… a potential enemy in the sense that the Rats, once they unite, can turn round and overthrow the Ruling Class. This, the Ruling Class would do its utmost to prevent.

    Objective: It is very important to understand the Exploiter’s objective – Power! And the rewards that goes with Power – control of a nation or nations’ resources, meaning Money. Their motivation is – Greed!

    How to Maintain Power:
    This is achieved through psychological warfare on the Rats, applying a constant barrage of mental attack, distractions, propaganda, conditioning, to create dissension among the Rats. Any rebellion had to be quickly put down without bloodshed if possible. The Rats are assets.

    History: To understand the mental model of the Pyramid, let’s go back in history to study various civilizations. In most of them, they can be represented by:

    A Ruler
    His court, bureaucracy, army, priests
    Major Landlords and Auxiliary standby army of the Landlords
    Money lenders, merchants & traders
    Landlord farmers

    At various times in history, different groups may hold sway.
    Eg: Theocracy: The Roman Catholic Church between AD 400 to AD 1600,
    Military: The army and the warlords - Oliver Cromwell.

    Government: Theoretically, the apex of the Pyramid is the Government.

    But the reality is quite different. Many forms of government existed throughout history. Some are listed below:

    Despotism: One of the earliest known forms of statehood and civilization - Babylon, Egypt.

    Slavery – This has existed since the beginning of written history and was prevalent worldwide. Pockets of it still exist today, in secret, as slavery is banned.

    Feudalism – As societies developed, slavery evolved in China, Europe, Egypt, India, Japan, South America, into feudalism with its attendant system of Serfdom.

    There is more: Autocracy, Capitalism, Colonialism, Communism, Democracy, Dictatorship, Imperialism, Military rule, Monarchy, Oligarchy, Plutocracy, Theocracy, Socialism, etc.

    For simplicity, we describe the people at the top of the Pyramid as an oligarchy - a government in which a small group exercises control, especially for corrupt and selfish purposes..

    The Pyramid mental model is merely a tool for us understand the forces driving us in this world. It need not be accurate or detailed. It has to be simple and flexible to accommodate new information.

    Theoretically, the government is at the apex of the Pyramid. The govt’s power is usurped by a small group, the real rulers, the Ruling Class (RC or oligarch). Modern-day government consists of politicians (from the ruling party, bureaucracy, army, internal security, secret service (external and internal), local government, religious establishment and judiciary. The RC is driven by the agenda of greed and desire to control a nation’s resources. They can consist of combinations of various layers of the Pyramid, typically from the four layers beneath it – FC, MIC, parts or all of Govt, and the BC. All aspirants to the RC sing the same song - we are here to protect your rights. We will fight for you, take care of you. But once in power, they change, because power corrupts. So Rats have to be very vigilant against any RC

    In a repressive regime such as Myanmar, the Pyramid consist of:
    1. Ruling Class - Military
    2. Small group of FC, BC & MC.
    3. Religious establishment
    4. WRC

    The US’s Pyramid is the most complete and global in nature. It has:
    1. Ruling Class – parts of FC, MIC, secret service, politicians from the ruling party & Govt
    2. FC
    3. MIC
    4. Govt
    5. BC
    6. MC
    7. WRC

    The US Pyramid is quite special. It has to serve the function of imperialism as basically, the US is an empire bent on global domination. Due to continuity and a long-term vision, the RC tend to be dominated by the FC, secret services and MIC. Politicians come and go, as dictated by elections. There is a constant competition among the various groups for dominance.

    In his farewell address in 1961, President Dwight Eisenhower warned against the danger of too much power vested in the Military-industrial complex - Military-Industrial Complex Speech, Dwight D. Eisenhower, 1961.

    The other major power, Russia, is quite different:
    Its Pyramid is less comprehensive, reflecting its lesser economic and military power. It has:
    1. Ruling Class – secret service, parts of MIC, politicians from the ruling party & Govt
    2. MIC
    3. Govt
    4. FC, BC, MC (not sufficiently developed yet)
    5. WRC

    The dominant group here is the secret service. Recognition is due to them for their successful efforts to rebuild Russia from the collapse of the now-defunct Soviet Union. They seem to have a vision of rebuilding a great Russia to challenge the US for world power.

    Next: Segment 2 - Who Controls the US?

  2. #2
    Join Date
    Oct 2008

    THE RAT RACE PART IV THE PYRAMID: Segment 2 - Who Controls the US?

    Segment 2: Who Controls the US?

    Nominally, we would have thought that President George W Bush was in charge. Not true! It is the Federal Reserve, the big banks and the major industrialists.

    Caution: We are now venturing into conspiracy theories. (For consistency, most of our resources will be referred from Wikipedia.)

    There is a very simple operating principle of the conspirators:

    1. Their objective is simply to control the global resources.
    2. They are driven by extreme greed.
    3. They are devoid of humanity and are not above murder and war to achieve their ends.
    4. Their real agenda is shrouded in secrecy. To hide their secrecy and mislead the public, they may present a public face that appears to operate as benevolent bodies.
    5. It is difficult to penetrate the group as it is constantly evolving and morphing to suit changing circumstances. At times, it behaves like a living organism.
    6. They operate in a time-frame spanning decades and even centuries. This is beyond the capacity for most Rats to comprehend.
    7. They see Rats as economic digits to be used and exploited at will.

    (Note: At the end of the day, it really doesn’t matter who controls what. It is only necessary to consider: How can we protect ourselves, to minimize the effects of these machinations on our lives. We cannot avoid it totally.)

    Trilateral_Commission: Founded in 1973 by David Rockefeller and Zbigniew Brzezinski, their objective is to promote closer political and economic cooperation between these areas, which are the primary industrial regions in the world, mainly Europe, Pacific Asia and North America.

    Council on Foreign Relations
    Prior to the founding of the Trilateral Commission, the Council on Foreign Relations (CFR) was the most significant body of global-minded elitists in the United States. As far back as 1959, the CFR was explicit about a need for world government, meaning global domination by the US.

    The Illuminati
    In 1776 Adam Weishaupt, the first lay professor of canon law at the University of Ingolstadt, started the Illuminati. The movement was made up of freethinkers, as an offshoot of the Enlightenment, which some believe was a conspiracy to infiltrate and overthrow the governments of many European states. The financiers, dating back to the bankers during the times of the Templar Knights who financed the early kings in Europe, created the Illuminati." Also here Mahathir's Mistake: Enemy Is Illuminati, Not Jews.

    The objective of the financiers for their apparent generosity to the kings was to secure the license to print money, to issue bank notes. To be doubly safe, they played both sides of the war, so that whoever won, it was the financiers who ultimately won. They learnt from Machievelli.
    Here is a light-hearted look at Machievelli and Mahathir.

    Here are a few other groups to consider:
    Bilderberg Group
    Club of Rome.

    Interestingly, a few names kept coming up:
    John D. Rockefeller:
    Rothschild family:
    J. P. Morgan: Those who are following the Gold and Precious Metals thread will encounter this name over and over again, especially with respect to gold price suppression on the COMEX.
    J. H. Schroders

    Is this the link to the Conspirators?

    The Source of Power
    The first significant shift of power to the Financial Class occurred when the US Federal Reserve was set up in 1913 when President Woodrow Wilson signed an Act of Congress authorizing it. Also here

    President Wilson later lamented that he had made a grievous mistake. So starts the story of the Conspiracy Theories and here.

    Stories abound about the FC being responsible for the start of World War I from 1911 to 1917, the communist takeover of Tsarist Russia in 1917, the Great Depression in the 1930’s, World War II from 1939 to 1945. Every time there was an upheaval such as war or an economic crash, a major shift of wealth from the Rats to the Financial Class took place. In every conflict, no matter which side won, the FC always seemed to turn out the winner. (By the way, there is a major economic shift coming up right now)

    The second significant shift in power to the FC occurred at the end of World War II. The US emerged as the pre-eminent global power. She wanted access to the global markets. Great Britain was exhausted by the two world wars. In exchange for being retained as the number two after the US, Britain ceded control of world power.

    1. Britain agreed to give up her colonies to open up the world markets to US trade. (And we thought our UMNO heroes fought the British and secured Merdeka for Malaya.)
    2. She ceded the role of Sterling as a global currency and accepted the USD as the new global reserve currency, under the Bretton Woods Agreement in 1944. The US held 65% of the World Central Bankers gold reserves back then. More here and here

    The US was now on track to become an Empire. The only nation standing in her path was the USSR. So started the Cold War - a war for the control of the world’s resources, a war that was cloaked in the language of ideology as a battle between freedom and repression, capitalism and communism, a war where the US went on a rampage around the world, trampling any nation that stood in her path. During this period, there were two countries she could not quite control – the USSR and China. Later, these two countries would come back to haunt her.

    The FC now had the license to print the USD, a global currency with which they could buy up the world resources.

    A Short History of Money:
    Around 1670 London goldsmiths introduced notes as certificates of their clients' ownership of gold. Gradually, the notes were used by goldsmiths' clients to transact commercial business without incurring the expensive and risky transportation of the underlying gold. Eventually these notes became widely accepted, becoming the first effective paper currency.

    Soon rulers learned the key advantage of paper money -- leverage! Progressively, and often in return for financing wars, institutions called "banks" were permitted to issue bankers' (shop) notes, each promising redemption in gold, but in multiples of the physical amounts of customers' gold they held on deposit.

    Soon national or central banks got in on the act. Economies grew rapidly, based on this new, miraculous "liquidity" of the new "paper" gold standard, a downgrade of the full gold "bullion" standard. Things got more complicated after that.

    The Ultimate Controller of Power:

    By now, it can seen that global power rested in the hands of the Central Banks, although they maintained the illusion that governments, especially the US Government, were the power.

    Behind the Central banks are the financiers, who appointed the central bankers such as Alan Greenspan and Bernanke to front for them as Chairman in the US Federal Reserve.

    These people are put there to serve their real masters – the owners of the US Federal Reserve.

    Who Owns The US Federal Reserve?

    The US Fed claims no one owns it. This article tells a different story: US Federal Reserve FAQ

    This explains it a bit more: The Moneymasters FAQS

    And here: Who owns the federal reserve bank

    This is a bit strange. Why all the secrecy? Look at this chart: The Real Owners of the US Fed

    (Note: This chart was prepared in 1976 and may no longer be up to date

    Do you see the names Rothschild, Bank of England, J. P. Morgan, Lehman Brothers, the major New York banks, J. Henry Schroder and Rockefeller. Scroll further down and look at the companies they control! These are the controllers and owners of the world! For simplicity, we will refer to them as the Financial Class (FC). Please refer to the Pyramid diagram above. (Update: JP Morgan and Citibank jointly hold 56% of the US Federal Reserve)

    Of course, China and Russia plus a few of the “Axis of Evil” and the Islamic Hijadis (Osama bin Ladin) don’t quite agree. That is why we have all these wars going on. The wars are simply wars over the control of resources.

    Now we can see why billions of people go through life not understanding what is going on?

    Information on the Conspiracy Theory is evolving. Do visit here to get updates:,42.0.html

    Next: Segment 3: The Rat Race Revisited

  3. #3
    Join Date
    Oct 2008

    THE RAT RACE PART IV THE PYRAMID - Segment 3 The Rat Race Revisited

    Segment 3: The Rat Race Revisited

    Let's review the Rat Race to understand how the Financial Class/Ruling Class (FC/RC) controls us.

    1. They control the government through the control of the politicians. The government is a vehicle used by the FC/RC to control power.
    2. They use laws to subdue the Rats
    3. To enforce the laws, they have in place collaborators and servants like the police, the army, the secret service, the bureaucrats (most of this class are employees but there are many collaborators at the top of the hierarchy.), the judiciary.
    4. Mass propaganda through control over the news media
    5. Ownership of financial institutions, big businesses and monopolies over utilities such as water, power, transportation, telephone, sewerage, toll highways, etc
    6. Divide & Rule: Religion, race, class
    7. Religious conformity: Religious Persecution
    8. External Bogeyman: George W Bush’s characterization of Saddam Hussein, Al Queda, Iran, North Korea as threats to the US. These claims are so laughable and yet the Americans swallowed it.
    9. Fascism: There is always the danger of unchecked power.
    Famous sayings: Baron Acton - Power tends to corrupt; absolute power corrupts absolutely.

    10. Taxation
    11. Retirement Fund such as the EPF. (BTW, this is a very convenient piggy bank to raid whenever the govt is short of money. RM 5 billion for ValueCap by Najib, proposal for EPF to buy govt land in KL)
    12. Social Security Fund
    13. Insurance: Pay now for depreciated money in the future.
    14. Savings: Eaten up through inflation
    15. Inflation to reduce the wages of the Rats

    What has inflation got to do with control? We know government takes money from us through taxation. But this is not very efficient. There are a lot of smart guys around who tries to evade tax. However, shrinking the value of money through inflation is easier to achieve. All bankers need to do is to print more money. When there is too much money chasing too few goods, inflation will rear its head. The current food crisis (rice, corn, wheat, etc) besides natural phenomenon like drought, floods and dumb policy decisions by politicians, can be directly traced to excessive growth in money supply.

    As long as the Rats stick to using money, the FC/RC has them under their control. That was why when Saddam Hussein tried to take Iraqi oil off the USD peg, he was toppled. Currently, Iran because she wants payment in Yen and Euro instead of USD, is being threatened with war by the US. The whole issue is about control of resources and power. Whoever threatened the FC/RC’s grip on power had to be removed. Again, it is useful to refer to George Orwell’s books 1984 and Animal Farm to make sense of our politicians.

    16. Credit and Debt

    The FC/RC, through the US Federal Reserve, can create credit by printing money. The US government buys the US Fed notes by issuing US Treasuries or bonds backed against their power to collect taxes…. and pays the US Fed an interest as well. The US Fed uses the US bond as backing for the US Fed notes, which we accept as “money”. Literary, the US Fed is creating money out of thin air. Every time we use the USD, we are paying the US Fed a hidden charge. Similarly, since the RM is pegged (at a floating rate) against the USD, we are also charged when we use the RM.

    The FC/RC then conspires to get us in debt to use their money (which is free to them). All the tricks in the Cashflow game are designed for that purpose. To make it more effective, the education system is designed to keep us financially illiterate. In the US, they go even further. Economic theories in the top universities are distorted to mislead the Rats. The products of these universities are then sent to the schools and other universities to preach the same “ideas”.

    Over the past few decades (since the USD was taken off the gold peg in 1971), the greed of the FC has created a very unstable financial system and the crows are coming home to roost. The FC/RC knew the game was up. So they started preparing for rebellion by the Rats.

    On 11 Nov 2001, four airliners were hijacked to attack the US. The US government blamed Al Qaeda. However, many people disputed the official position - 911 Truth. In response to the attack, the US launched a Global War on Terrorism and became openly belligerent with the rest of the world. President Bush declared “You are either with us or you are against us.”, forcing many countries to cave in to the US under threat of war. The US attacked and conquered Afghanistan and Iraq. Now they are threatening Iran. Coincidentally, the agenda of the US appears to fit in very nicely with the aims of the Conspirators.

    The Americans were overcome by a climate of fear. Taking advantage of that, the government pushed through a bill to set up the Dept of Homeland Security) severely curtailing the civil rights of the Americans. Note that fear has been used to cow the Rats. The department has grown into a massive entity with estimated budget of USD 50.5 billion in 2009. We must wonder why such a huge body is required for internal security. But if we were to consider the looming financial crisis, which the FC/RC had foreseen and were in fact, instrumental in creating, to rob the investment community and foreign investors, and the likelihood of civil unrest arising from it, then having a large domestic defense force begin to make sense. Things are evolving and we will be able to see how things play out within the next couple of years. (Note: Every time there is a crisis and the Rats are overcome with fear, the Ruling Class will take the opportunity to take on more power upon themselves to control the Rats. This has been a persistent pattern of behaviour of politicians through the ages)

    But an interesting question to ask is: How do they get away with it?

    Next: Segment 4 - How do they do it?

  4. #4
    Join Date
    Oct 2008

    THE RAT RACE PART IV THE PYRAMID: Segment 4 - How do they do it?

    Segment 4: How do they do it?

    Some answers can be seen in the movie The Matrix

    A super-computer has dominated the world. It uses humans as a source of energy. To keep them under control, a computer chip has been implanted in their brains to create a virtual life for them, while in reality, they are lying unconscious in a store room, intravenously fed and functioning effectively as batteries. Occasionally, some humans escape and try to fight back. The super-computer created some vigilantes with super-powers to hunt and kill these renegade humans. The movie revolves around the renegades efforts to resist the vigilantes.

    In real life, we are not at that stage yet but the efforts to brainwash us is not far removed from the Matrix control.

    How does the FC Control the RC?
    Two elements bind the Ruling Class (RC) to the FC.

    1. Greed – the RC is beholden to the FC due to the promise of a share in the loot that is available once they gain power. In their rise to power, the politicians aspiring to the RC were likely financed and supported by the FC.

    2. Fear – the RC is frightened of being eliminated by the FC due to their control of global resources and military power.

    Once in power, these two groups proceeded to rape the resources of the nations they control. The FC planned very long-term – in decades, even centuries. To them, what was important was total control of the Rats without them realizing it. A docile population makes for a much cleaner operation..

    What Can Go Wrong?
    There are a few events the FC and RC are frightened of:

    1. Rebellion by the Rats through an uprising,
    2. Rebellion by the Rats through the ballot box.,
    3. An external power challenging their hold on power. Defeat by this power in war,
    4. Financial Crash,
    5. People abandon money for gold.

    1. Rebellion by the Rats:
    It should be clear by now the measures taken by the FC were to prevent the Rats from rebelling and to keep them subjugated. Such measures even extend to elections. The ruling party will subvert the electoral process to ensure re-election, including compromising the Elections Commission itself. We can see an example of this in Zimbabwe's Downward Spiral Closer home, many should be aware of the abuse of the electoral process during the Mar 2008 Malaysian elections.

    2. Defeat by a stronger enemy from outside:

    This is a fear experienced by every ruling class in every country. Hence the arms race and the pre-emptive violence against perceived enemies who are weaker.

    3. Financial Crash:
    A financial crash beyond their capacity to absorb can shake them. They have seen it coming for a while and have prepared themselves. This is a precursor of things to come:

    Asia and the vicious cycle of bank bailouts

    The Greenback Is Fast Losing Its Appeal
    Tindak Malaysia Finance & Economics Board

    The latest version has been building up since Oct 2006 and is getting more dangerous. Their rivals in Russia, China and Iran are girding themselves to take advantage of the crisis. It is hard to predict the winner but what is certain is that the Rats will suffer in the turmoil. In the US itself, the Dept of Homeland Security stands ready to curb any protests by the local Rats. An army unit has also for the very first time been stationed in the US to prepare for civil disorder.

    4. People abandon money for gold.
    When inflation is rampant and the Rats can see that gold price is shooting up, they will lose confidence in paper money. This will trigger a stampede to gold. Here are a few articles that may help the reader understand the relationship between gold & inflation.
    In gold we trust

    Former US Fed Chairman, Alan Greenspan, knew of the outcome of having a banking system that did not adhere to a gold standard when he said in a book by Ayn Rand published in 1967:

    “In the absence of a gold standard there is no way to protect savings from confiscation through inflation. There is no safe store of value.”

    He went on to say:
    “Deficit spending is simply a scheme for the hidden confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights.”

    End Game:
    We are now coming to the end game for the US and with it, the FC. It is hard to predict what will be the outcome.

    Will it occur with a big bang, with the US economy imploding and the FC along with it? Will a new world financial architecture be constructed around a gold standard?

    Or is the FC desperate enough to trigger another world war, hoping to fight their way out of this mess?

    Another Problem:
    While humanity is in a mad rush to get rich and exploit the earth’s resources, there are signs that nature is hitting back. In recent years, we are faced with an explosion of illnesses and natural calamities.

    To name a few:
    AIDS, Bird Flu, Food and Mouth Disease, Japanese encephalitis, Nipah Virus, Mad Cow Disease, Global warming, El Nino, food shortages, etc.

    Are these the early warning signs of a pandemic and a backlash from Mother Earth? This is something worth pondering.

    What Can We Do?
    We will examine this question in the next article: The Rat Race Part V – The Malaysian Pyramid.

  5. #5
    Join Date
    Oct 2008


    It is important to learn from history. The Financial Class manipulates the financial markets to cheat the ordinary investors.

    See this video on the 1929 Crash:

    It has taken several decades before the Rats forget and then they get sucked in again. We are now seeing a repeat of the same old story. It is always the same story because human emotions of greed and fear never change.

  6. #6
    Join Date
    Oct 2008

    The Breaking Down of the Financial System

    The main figures in the Conspiracy Theory are from the Financial Class. The Financial Class have manipulated the financial system so drastically and loaded it with some much toxic waste through financial derivatives that the system is breaking down. Because central to the system is investor trust. That is essentially lost.



    The banks are part of the Financial Class that has exploited the Rats for centuries. We are coming to the end of that system. It will be useful for us to understand why.


    Today, people today are not taught to be productive, instead they are taught to consume. At the core of the issue of over consumption is the banking system. It contributes no real value to society, rather it is a parasitic system that produce ‘profits’ by putting people in debt.

    It’s the beggar thy neighbor approach, coupled with the idea that the banking system is in control and we should trust them with our money, that we need to put our money in the banks for safety. Ever wondered why crime is increasing? Could it be a scheme to frighten us to put our money in the bank instead of keeping it at home?

    To talk about people being hard working and prudent with their earnings seems to be a thing of the past. We are exhorted to spend, spend and spend, to buy more, eat more, watch more TV, to be anything but productive. The media panders to our ego and vanity. Society has lost its way. Our bankers seem to be hell-bent on expanding debt because the banking industry cannot settle their transactions – to close the account.

    To do this honest and impartial money is required, which we do not have or are not using. Nor is it favored or promoted within the current banking system.

    Why are commodity prices shooting up?

    Are these the signs of decay with rising commodity prices beginning to eat into our ability to consume and repay. Are falling house prices and rising commodity prices connected?

    Is there a shift taking place into productive assets, away from unproductive ones? One way to understand the concept of resources is that they are a store of energy, something that could be used to support the endeavors of productive people and not something that should be used purely for consumption.

    The banking system is, essentially in the business of stealing resources from both their customers and their clients, to maintain the life style’s of the bankers themselves. Through mass propaganda, society has also been conditioned to believe that wealth can be created by the debasement of honest money, via its replacement with paper money.

    Consumption is the foundation upon which the fiat banking system is built and this involves credit expansion, which requires people to service the debts, slaves to till the banker’s fields, while the bankers enjoy the fruits of these labors. This is in essence the Rat Race.
    But who settles the banker’s liabilities when things go wrong? Currently the Central Bankers are bailing them out by printing money. How long can they continue to create ‘debt’ when there is no recognizable means of repayment?

    The acceleration of this nefarious activity began the day President Nixon closed the gold window on August 15, 1971 and has multiplied many-fold until today it is unsustainable. It’s not that the value of productive assets is going up, rather it’s the recognition that the paper currency is worth less. The Rats have lost confidence in fiat money. To protect the value of their money, they turn to commodities.

    How long can the Central Bankers continue to find new Rats, ones who have some ability to take on liabilities by way of new debts, new mortgages, new credit cards and new student loans? Where is the capital required to continue this credit/debit game?
    End Game

    The end game is coming. How long can the Financial Class avoid the inherent issue of settlement by replacing its member’s debt with its own worthless debt? Debt which can never be redeemed? Soon we are going to find out what happens when the Rats demand that a non-redeemable currency be made redeemable. That is when governments will make use of their secret services, their police, the arm forces, the para-military forces and the Detp of Homeland Security.

    Also read Catharine Austin Fitts' Solari Report - Looking back at 2008
    Attached Files Attached Files

  7. #7
    Join Date
    Oct 2008

    How the conspiracy works

    If you were to substitute some of the names with corresponding names in Malaysia, you will see a striking resemblance.

    This is a sample of how the Conspirators work:

    The Antidote to Systemic Financial Corruption

    By Jon Herring

    An article in the recent issue of Fortune highlights some flawed thinking about the current financial crisis and the financial system in general. There is a quote from the article, featured in a sidebar that reads: “The idolizing of free-market finance has been thoroughly discredited.”

    Wrong. The problem is not “free-market finance”. The problem is that there is no such thing in today’s world.

    We do not have free markets. If we did, there would not have been a short-selling ban last summer. The legitimate short-sellers (as opposed to naked short-selling which is criminally fraudulent) did more than anyone to expose the fraud and abuse within the financial system.

    If we had a “free market” then the institutions which failed to manage their risk (to put it kindly) and those that engaged in fraudulent accounting would have failed, making way for more capable allocators of capital and better managers of risk.

    In the wild, species grow stronger by natural selection. The weakest are culled and the strong survive. The same principle should work in business. Instead we have a system of “unnatural selection” where your tax dollars are used to bail out crooked bankers and prop up failed institutions like walking zombies. Many of these people should go to jail. Instead we’re handing them money.

    Ayn Rand summed it up as well as it can be said in Atlas Shrugged:

    “When you see that trading is done, not by consent, but by compulsion - when you see that in order to produce, you need to obtain permission from men who produce nothing – when you see money flowing to those who deal, not in goods, but in favors – when you see that men get richer by graft and pull than by work, and your laws don't protect you against them, but protect them against you – when you see corruption being rewarded and honesty becoming a self-sacrifice – you may know that your society is doomed.”

    Allow me to pull a few gems from her quote:

    * You see money flowing to those who deal, not in goods, but in favors
    * You see that men get richer by graft and pull than by work
    * Your laws don't protect you against them, but protect them against you
    * You see corruption being rewarded

    I don’t have to point out the parallels in the above statements – which were published in 1957 – to what has been exposed in the financial system in recent years. And, yes, I mean recent years. Don’t forget Enron, Tyco, Worldcom, Adelphia, Global Crossing, etc.

    We do not have free markets, and we most certainly do not have a system of “free-market capitalism”. What we have is an anathema to capitalism -- a cancerous, mutated form of capitalism known as “crony capitalism.”

    A lot of commentators have wondered aloud how the financial regulators could have been so inept. How many times have you heard that the regulators were “asleep at the switch”, like some drowsy ship captain that runs ashore?

    There is no doubt that the regulators are inept. We have ample proof of that.

    For nine years, investment professional and mathematics whiz Harry Markopolos tried to persuade the Securities and Exchange Commission to investigate Bernard Madoff. He showed definitive proof that the firm’s returns were not only improbable, but mathematically impossible.

    In an email documenting his frustration with the regulators, Markopolos wrote:

    “Meagan Cheung, branch chief, in New York actually investigated this but with no result that I am aware of. In my conversations with her, I did not believe that she had the derivatives or mathematical background to understand the violations.”

    How in the world does the SEC hire someone to head the New York branch office of their enforcement division, who does not have the skills or the background to perform their stated duty?

    Perhaps, because they are not meant to perform that stated duty. Remember what Ayn Rand wrote? “Your laws don’t protect you against them, but them against you.”

    On the whole, the regulators are certainly inept. But they are also horribly corrupt.

    The rot within our financial system goes well beyond the risky and fraudulent behavior that has been exposed. It extends fully to the institutions that are meant to discourage that risky behavior and prosecute against fraud. The corruption and rot are systemic.

    Former Senior SEC. investigator Gary Aguirre is one of the good guys. I say, “former” because he was fired by the SEC. Why was he fired? Evidently it was because he didn’t understand that the unspoken mandate of the SEC. is to protect the politically and financially powerful from the people, instead of the other way around.

    Aguirre was working on an insider trading case. When the trail led toward John Mack, who was then CEO of Morgan Stanley, Aguirre’s supervisors killed the investigation. They told him that Mack had “too much juice” to pursue.

    The following is from a letter that Aguirre wrote to the United States Senate:

    “Fixing the SEC so it can protect investors and capital markets from hedge fund abuse will not be an easy task. Powerful interests want the SEC to stay just the way it is or, better yet, to become even weaker. Those interests are not just the hedge funds. They include the financial industries that are receiving tens of billions of dollars in revenues for helping hedge funds cheat other market participants or close their eyes to the carnage. At the top of that list are the big investment banks, e.g., Goldman Sachs, Morgan Stanley, Merrill Lynch and Bear Stearns. Those interests know how to reward friends and punish perceived enemies. Their tentacles reach far. They stopped the hedge fund investigation I was assigned to conduct. They cost me my job.”

    We don’t have anything even resembling “free-market capitalism.” What we have is a thoroughly corrupt version of capitalism. It doesn’t reward those who win in fair competition. It rewards those who have the most “juice.”

    A common misconception about “free-market capitalism” and “libertarianism” is that they lead to “anarchy” or “anything goes”. This is patently untrue. The ideals of libertarianism, for example, state that you should be free to do whatever you wish as long as you do not infringe on the rights of another to life, liberty and property.

    Hiding liabilities on your balance sheet, for example, to disguise what your company owes and its true financial strength is fraudulent. Fraud is theft. And theft is depriving another of his property. We don’t need more laws against these things. We don’t need more regulation. We need to enforce the laws we have.

    But that is not what you get in a crony capitalist system. You might have heard the saying that the “insane are in charge of the asylum”. For a long time, that is how I have felt about our financial (and political) systems. The criminals are running the prison.

    I could go on and on about the bought-and-paid-for credit ratings agencies… the outright manipulation of various markets… the naked short-selling scam that has destroyed any number of companies… the massive theft associated with the taxpayer funded “bailouts”… and the “asleep at the switch” regulators who didn’t see nothin’.

    Instead, I’ll focus on one of the very few financial assets that cannot be manipulated and which has no counterparty risk. Gold and silver that you hold in your physical possession.

    But wait, you say… gold is being manipulated too. And you’re right, the price of gold on the spot market has been manipulated for years. In fact, the orders and means to do so have come from the highest halls of power – the Central Banks, U.S. government agencies and the largest investment banks. And all under the watchful eye of a very “drowsy ship captain” – the U.S. Commodity Futures Trading Commission (COMEX).

    But the “spot price” of gold in the manipulated futures market is not the same as gold you can hold in your hand and sell to another in a private transaction. Recently the price of gold in the “spot market” and the price of gold in the “free market” have begun to diverge. I strongly believe that not only will the price of gold rise in the months and years ahead, but the premium that someone is willing to pay for the real thing, will rise as well.

    I am not suggesting you abandon the markets entirely. Over the very long term there are few passive investments that are better than buying stock in well managed, growing companies at a significant discount to intrinsic value. What I am suggesting is that if you do not have at least a portion of your net worth in tangible assets that you can hold in your hand, you’re swimming naked with sharks.

  8. #8
    Join Date
    Oct 2008

    Bush, the bumbling pawn of the Conspirators

    One of the Conspirators that we omitted to mention is the Project for a New American Century (PNAC). Bush is their pawn. Unwittingly, they, through Bush, have managed to run the world's greatest military and economic superpower into the ground.

    It's wonderful what arrogance can do for you. Does that sound familiar regarding a party closer home?

    PNAC did not anticipate a New American Century that would involve a 50% reduction in their wealth.

    This article is worth keeping for future reference as the unwinding of the US continues.

    Obama came on-board just in time to catch all the mess.

    And this is a real big one.

    Fade out on George W Bush

  9. #9
    Join Date
    Oct 2008

    The Ruling Class & The Financial Class

    This thread need to be read together with The Global Rat Race

    For the past 300 years, the Financial Class have been increasing their power viz-a-viz the Ruling Class. The reason is very simple:

    The Financial Class (FC) is made up of mainly "old money" - money that is inherited through the generations. This group of people can afford to have very long time-frames in their planning, even as long as generations. Whereas, politicians do not have that luxury. They have to go back to the people to be elected every 4 to 6 years depending on their term of office. So politicians come and go but the FC remain, constantly controlling the money that is needed to finance every activity. With this power, they are able to buy up the politicians and make them do their bidding.

    But once in a while, maybe every 50 or 100 years, the FC over-extend themselves through their greed. Today is one such event. The banks are going bust and begging the politicians to bail them out. This has given the politicians a wonderful opportunity to cut the FC down to size and take control over the banks. Do not be misled by all the talk about bail-out, the saving of the financial system, saving the economy, jobs, etc. Underlying all this is a power-play, a transfer of power from the FC to the RC. And the Rats will pay the price, whatever the outcome.

    But the current mess is too big and it is likely that both the FC and the RC will go down together.

    Normally, the FC operates under a very opaque veil and it is difficult for the average person to understand their modus operandi. It is different now. Because of the unwinding of the financial system, all the tricks and schemes that were used to cheat the Rats are coming out in the open.

    The World Economic Forum at Davos is an annual get-together by the FC and RC to plan their economic strategy to control the world economy. This year, the FC is to attempting to come up with solutions to save their own skins.

    In preparation of the meeting, on Jan 15 a report on “The future of the Global Financial System” was prepared. It is stimulating although, ironically, many contributors come from organizations which have been mutilated by the crunch.

    Moreover, the study reaches no consensus on the shape of the future; it presents four very different scenarios. Nevertheless, it is interesting because of the depth of the evidence reflecting the work of 250 thinkers gathered in eight major workshops. It is especially valuable on what went wrong.

    One important conclusion that can be derived from the report is that the Age of Moderation of the past 2 decades has ended.

    End of “Age of Moderation”

    That was a period of great macroeconomic growth, stability, declining inflation and unemployment. Recessions were few, shallow and short. The financial system enjoyed unprecedented earnings growth due to expansionary monetary policies, globalization and sustained economic expansion.

    The Chairman of the US Federal Reserve then, Alan Greenspan, was seen by financial markets as a god. Wall Street and the politicians hung on his every word, which was so powerful that it could move markets. But hidden behind his words were his actions that laid the seeds for the destruction of the US economic system.

    Debt increased massively due to a prolonged period of very low interest rates and the creation of a housing bubble to off-set the bust of the tech bubble in year 2001.

    US Household debt grew from 45% of GDP in 1984 to 97% in 2008:
    Financial sector debt grew from 19% GDP in 1984 to 118% 2008.
    Interest rates generally declined: US 10-year bonds yielded 16% in 1984, 4% in 2008.

    In a low-yield environment, investors welcomed risk and the market responded with highly leveraged products.

    The era was built on excessive deregulation and excessive credit and leverage. The commercial banks managed to persuade the US Congress and President Clinton to repeal the Glass-Steagall Act 1933, that prohibited commercial banks from venturing into the fields of investment banking, brokerages and insurance. The banks went into an orgy of financial leveraging that today stands at almost USD 1000 trillion. That is 20 times the global GDP. When the crisis hit, deleveraging took place and banks started to fall like ten-pins. And now, these banks are too big to salvage.

    Next.... What will dictate short-term events and what are the likely scenarios.

  10. #10
    Join Date
    Oct 2008

    Neville Bennett: Watershed to a New Era

    Comment by Comrade in Golden Arms (CIGA) Peter:

    From disagreements emerging at the world economic forum at Davos it appears that we now move to the next entirely predictable but very dangerous, accelerating and possibly unstoppable phase where governments regardless of culpability find it politically expedient to polarize and hold other nations responsible for their problems,

    Governments, in order to get out of their complicity in creating the current financial mess, will resort to the blame-game. Timothy Geithner, the new US Treasury Secretary, probably with the acquiescence of President Obama, has accused China of manipulation of the Yuan. That is a serious charge that could lead to grave unintended consequences for both countries and by extension, the global economy.

    The reality is, the US caused this mess due to their banks' greed in creating all those toxic financial derivatives, the American people lived beyond their means for decades, the US government tried to maintain an unsustainable imperial army worldwide, with the help of the USD which they could print at will and dump onto the world markets.

    The US politicians know this and they are fearful of facing the wrath of the people. Their first tactic is diversion - blame other countries for their woes. If that doesn't work, prepare for war - look for excuses to attack other countries, especially the weaker ones. (Remember Afghanistan and Iraq?) Next is domestic repression - that's where the Department of Homeland Security comes in handy. Also the US Army that is on standby for active duty in the US itself. Such tactics are standard fare for every Ruling Class in history. It never change!

    [color=blue]Something has to give and if we are to be patient in reading (88 pages long. Better to print it out and read at your leisure), there are likely to be answers there. The Future of the Global Financial System

    [color=blue]The most probably outcome is that the world will split in 3 economic blocs:
    1. North America led by the US
    2. Europe led by the EU. The UK is likely to shrink dramatically during this crisis.
    3. Asia led by China and Japan, with Russia, Brazil and the Middle-East coming on board later.

    South America and Africa is going to be a free-for-all with most opting for the Asian bloc. That's where our future wars will start.

    This sounds exactly like George Orwell's 1984!

    For Malaysia, our best bet is to hitch onto the Asia bloc led by China and maintain good relationship with the other two blocs. That will entail Malaysians having to master Chinese and English. That should be an indication on where our education should be headed.

    Watershed to a New Era

    Neville Bennett, 23/1/09

    End of “Age of Moderation”

    In retrospect, the two decades before 2007 were halcyon years, an age of moderation. It was a period of great macroeconomic growth, stability, declining inflation and unemployment. Recessions were few, shallow and short. The financial system enjoyed unprecedented earnings growth due to expansionary monetary policies, globalization and sustained economic expansion.

    The era was built on excessive deregulation and excessive credit and leverage. That era has passed and cannot be resurrected.

    What of the future?

    Three new drivers

    1. Deleveraging.

    Deleveraging bank and household balance sheets will place severe stress on the global economy, especially price declines and falling values in equities. Moreover, tighter and more expensive credit has forced investors to sell-off leveraged assets. Leverage occurred over 20 years, and deleveraging will also be protracted. Unwinding consumer debt will have enduring effects, most probably inducing a long recession, and shifting power from industrializing to emerging countries

    2. More Government intervention.
    Governments have assumed banking-sector risk in exchange for greater regulation and oversight. Interventions will strain national fiscal positions, raising the risk of sovereign default and IMF intervention. Risks have increased sharply in emerging countries, renewing pressure on inflation, devaluation, deteriorating foreign direct investment and poor economic growth.

    Governments will become important players in the markets they regulate. Their interventions will be felt acutely by the newly semi-nationalized institutions which will be torn by competing objectives set by sovereign and private shareholders (for example, government might want low interest rates to stimulate growth while shareholders want profits). Private shareholders are also expected to be more activist.

    3. Weaker cross-border activity.

    Governments will regulate to introduce early warning systems, to prevent market failure and systemic risk. Other issues are controls on capital flows. Capital flows are already diminishing and trade is falling sharply. Having shored up domestic banks, some governments will be tempted to reduce foreign competition. The prospect for globalization is much less certain than before.

    Long-term Scenarios

    The report goes beyond merely extending current trends, and explicitly considering critical uncertainties, potential discontinuities and system dynamics in order to support strategic decision making and collaborative action. There are two critical uncertainties: the pace of the geo-economic power shift to the emerging world, and the degree of international co-ordination on financial policy. Other drivers include energy use, commodity prices, fiscal policies, trade regimes, climate change, exchange, demographics, and global wealth distribution.

    Four major scenarios are sketched.

    1. Financial regionalism; blame shifting and desire to avoid contagion in the future leads to three major blocs on trade and financial policy, forcing global companies to construct tripartite strategies to operate globally.
    2. Re-engineered Western-centrism: a highly coordinated and financially homogeneous world that has yet to face up to the realities of shifting power and the dangers of regulating for the last crisis rather than the next.
    3. Fragmented protectionism is a world characterized by division, conflict, currency controls and a race-to-the bottom dynamic that only serves to deepen the long-term effects of the financial crisis.
    4. Rebalanced multi-lateralism: a world in which initial barriers to coordination and disagreement over effective risk management approaches are overcome in the context of rapidly shifting geo-economic power.

    Each of these scenarios describes key forces and possible turning points that could shape the financial system. They are regarded as plausible. It will be noted that these are very gloomy for liberals who want little regulation and open access to the world. None predicts more free-trade, tariff reduction, or globalization.

    The World Economic Forum, nevertheless, assumes the report will be useful for its insights, and it can be the basis of global collaboration to strengthen the financial system when the Forum gathers for its annual meeting this year.

    The preface says there is “a unique and timely opportunity to shape the post-crisis world (sic) in a holistic and systemic manner”. I had not realized that the crisis was over. Each week bring fresh scares in the financial world (Britain has announced a second bank rescue), and in the real world demand is falling very rapidly.

    To be sure the report acknowledges the risk of “a severe global recession that will affect many sectors, asset classes and regions in tandem”, and that it will take” years to work through the crisis and adjust to its long-term effects”.

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