Revolution in Switzerland?

An op-ed from Sam Gerrans has been getting a bit of attention – Switzerland: Poised for a revolution?

When Iceland jailed its bankers something changed. The unthinkable had happened: the real criminals had been held to account. Now Switzerland is also threatening to go off the fiat-bankster reservation. But will it happen?

In an article entitled “Switzerland to vote on banning banks from creating money” the Telegraph reports: “Switzerland will hold a referendum to decide whether to ban commercial banks from creating money.

The Swiss federal government confirmed on Thursday that it would hold a plebiscite, after more than 110,000 people signed a petition calling for the central bank to be given sole power to create money in the financial system.

The campaign – led by the Swiss Sovereign Money movement and known as the Vollgeld initiative – is designed to limit financial speculation by requiring private banks to hold 100pc reserves against their deposits.

This sounds incredibly dull, doesn’t it? But the idea behind it is what revolutions are made of.

The article continues: “Banks won’t be able to create money for themselves any more, they’ll only be able to lend money that they have from savers or other banks, said the campaign group.”

I’ll repeat that bit: they’ll only be able to lend money that they have from savers or other banks.

That’s probably what you think banks do: lend money they acquire from savers or other banks.

But no! They are busy creating money (albeit by a circuitous route); that is, they are busy magicking that thing the rest of us spend our lives working so hard to obtain – money – into existence. They do it by means of the creation of an imaginary thing called debt. We then undertake to pay these fictional notions back, and do so with interest.

Not only is this outright fraud and theft against the poor sap who signed the original credit agreement, it also debases the value of every single unit of the currency in which the transaction takes place.

Put in business terms, it is equivalent to printing more shares.

The article continues: “The SNB (Swiss National Bank) was established in 1891, with exclusive power to mint coins and issue Swiss banknotes.

However, over 90 percent of money in circulation in Switzerland now exists in the form of “electronic” cash created by private banks, rather than the central bank.

‘Due to the emergence of electronic payment transactions, banks have regained the opportunity to create their own money,’ said the Swiss Sovereign Money campaign.

‘The decision taken by the people in 1891 has fallen into oblivion.’

That is correct: if we had access to the same computer terminals the banks have, we could magic in or out of existence all the imaginary stuff we are trained to think of as important – money – in whatever quantities we liked.

This is how it works: when they print quite a lot of this stuff there is a boom. When they print too much of it, there is inflation (actually, the printing of money is inflation). When they stop printing it or simply hold on to it, there is a depression.

As long as the people keep slaving away and let the bankers give them pieces of paper or blips on a computer screen in exchange for their blood, sweat and tears, everything is fine.

But if a nation begins to wake up to the con and starts pushing back it is visited by a color revolution, cultural invasion, or simply bombed back into the Stone Age.

That’s it. You now understand economics.

Maybe.

Now back to the prospective plebiscite in Switzerland.

I am skeptical that this duck will get airborne without being shot down. The democracy the Swiss think they have is a pleasant enough fiction, but I am sure it will never be allowed to interfere with business.

And if we read the article carefully, it does say that the central bank should be given sole right to create money. This would essentially leave the creation of money in the same hands as those who control the Federal Reserve or the Bank of England rather than allow them to farm out the process. But at least it shows that people are beginning to wake up to where the true power lies.

In the unlikely event that this grass-roots movement in Switzerland should get its way and its proposed legislation be enacted, and then begin to morph into something which really does threaten the banking elite, we must not be surprised if Switzerland is shortly discovered to be harboring weapons of mass destruction, or to have masterminded 9/11, or to be financing Islamic State.

Yes, we will need to brace ourselves to be educated by a Western media unanimous in pointing out the connections to be made between the production of precision watches, pavements so clean you can eat your lunch off them, and the evil of an irrational hatred of freedom – one with roots in a culture which tacitly supports jihad against all non-eaters of expensive confectionery.

Freedom. You’ve got to love it!

Here’s something else from Gerrans, from eleven years ago:

I don’t believe in democracy. In some liberal circles this makes me a heretic who should be shot.

I suggest that – internal squabbles notwithstanding – the strong and powerful do more or less what they want, and the rest is just PR. This view is unflattering to the rabbits caught in the headlights of Democratic rhetoric, but I can’t help that. Still, happily for me, as things get worse in the Middle East, the liberals will find it increasingly difficult to justify their worldview to themselves. It’s small comfort in the circumstances, but it’s something.

Democracy’s key attraction for those who truly wield power is the fact that widespread belief that we are free is a cost-efficient means of control. But democracy is not and never has been Freedom; merely dictatorship-lite. And now the Totalitarian infrastructure is in place our rulers can opt to dispense with the spin.

Democracy will, of course, cling to its touchy-feely slogans for as long as it is expedient. But since the real U.S. game plan is to ratchet up the stakes in the Middle East to the level of war necessary to complete the project for Greater Israel – from the Nile to the Euphrates – and since the history of the last hundred years shows that no sacrifice to this end is too great, don’t be surprised if our rulers drop the pretence that this is anything but a good old fashioned massacre and start levelling whole Iraqi cities.

My point here is not to draw moral conclusions. I have my opinion of course. But, for me, the bottom line is this: The strong and the sneaky do what they do and the rest of us need to decide what – if anything – we are going to do about it.

Just don’t wave the democracy dogma in my face because I don’t believe in it.

So shoot me.

 

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23 Comments

  1. I have some savings which I have invested in term deposits with one of the Australian Banks here in NZ. When a deposit matures, invariably I lose at least two days of interest. This is notwithstanding the fact that the money never left the Bank’s control. I have tried to avoid this loss of interest by telling the bank before the deposit matures, what further investment I want. Nonetheless, the new investment invariably becomes effective at least two days after the maturity of the initial deposit. Multiply my loss of interest by the number of depositors in the bank, and you will get the size of the bank’s rip-off of its customers. How fair is that?

    Reply
    • kiwi guy

       /  28th December 2015

      Finance sector skims everything, its basically their business model, a few cents here and there on individual accounts can add up to 100s of millions or more over the years.

      Reply
  2. kiwi guy

     /  28th December 2015

    “limit financial speculation by requiring private banks to hold 100pc reserves against their deposits.”

    100%! That is as extreme as what happens now just in the opposite direction and probably just as harmful. After all not ALL debt is bad, if its being invested in productive activities instead of malinvested in zombie businesses and speculative bubbles.

    Reply
    • “hold 100pc reserves against their deposits” This is something other than a bank, surely?

      I’ve no particular love for banks but isn’t lending and investing part of their job?
      It’s not genuine ‘usury’ unless they’re lending and investing your money.
      If I want nothing more than a security vault I can build myself one at home.

      (I realize I am showing my ignorance of the finance sector here, so go easy)

      Reply
  3. Sounds like a social creditor having a whine. If you don’t like people selling debt, don’t borrow money!

    This nonsense about “real money” and “fake money” is a bunch of voodoo. If a bank “creates” money, it’s because they have a contract which will generate real income, and real profit, and it’s the confidence that this will happen which allows the banking system to work. However, if the Swiss want to kill the goose that lays the golden egg, they should knock themselves out…

    Reply
    • Blazer

       /  29th December 2015

      ‘If a bank “creates” money, it’s because they have a contract which will generate real income, and real profit, and it’s the confidence that this will happen which allows the banking system to work.’….really…so the cause of the GFC was what then?A giant con job!

      Reply
      • It was a con job by the US government. They financed thousands of junk mortgages, which speculators bought up and sold to various funds. The con was bureaucrats lending money to “people of Walmart” who had no serious way of paying it back. The banks got conned first of all. I’m always amazed at people who try to tell me that the banks are the criminal party in all this. The banks were just doing what they normally do.

        Reply
        • Blazer

           /  29th December 2015

          so nothing to do with repeal of Glass Steagal and rapacious Wall St creations like CDO’S,CDS’s ,synthetic derivatives then!Do tell.

          Reply
          • “Rapacious” is an emotive word. Nobody was forced to invest. They thought they were investing in the value of mortgages that people were actually going to continue to pay off. That was a lie. Who lied? Not the banks, it was the government through Fannie Mae and Freddie Mac!

            Reply
            • Blazer

               /  29th December 2015

              surely you have heard of liars loans,robo signing,paying for tranches of securities to be AAA rated!!!

  4. It will stop crashes etc, but it would be a massive force choke on economic growth too, thats why everyone is looking at the middle ground of higher asset to loan ratios and liquidity for banks to boost confidence, prevent anoter GFC and without choking growth.

    Reply
    • Blazer

       /  29th December 2015

      where is the economic growth from the present private banking cartel with all the almost negative interest rates and sustained QE?

      Reply
  5. If a bank lends a 100% of its deposits how does anything change?

    I have 10 dollars, I deposit with the bank. They lend the 10 dollars to someone else who uses the 10 dollars to buy an item [either a consumption item or a capital good] and the person who sells the item now has 10 dollars which they promptly deposit in their bank account….. so the bank now has another 10 dollars in their accounts to lend….. and on it goes.

    Fractional Reserve banking doesn’t allow the complete lending of the 10 dollars. The bank must:

    1 – have a capital base to start with before accepting deposits
    2 – retain a part of every dollar deposited, a fraction as reserve so eventual the amount available to lend is ended.

    The problems in our financial system are banks seeking ever higher returns on equity by embracing risky and risky lending plus the advent of derivatives which shift so much of balance sheets and hide the true extent of companies and banks exposures…

    Reply
  6. Timoti

     /  28th December 2015

    ” In the unlikely event that this grass-roots movement in Switzerland should get its way and its proposed legislation be enacted, and then begin to morph into something which really does threaten the banking elite, we must not be surprised if Switzerland is shortly discovered to be harbouring weapons of mass destruction, or to have masterminded 9/11, or to be financing Islamic State.”

    President Gadafi found out the hard way when he tried introducing a gold dinar as the currency of choice in exchange for oil. That would have threatened the American Dollar. Gadafi was conveniently hacked to death. Unlike Gadafi, I’m sure the Swiss will do the permutations before taking a leap of faith.

    In New Zealand we have the Open Bank Resolution Act that protects banks in times of strife, using term depositors money. But as a breathless bimbo from the Reserve Bank told me, such drastic action can only happen if the Reserve Bank Governor and Finance Minister sign off on that course of action.

    Incidentally, unlike term deposits in Australia, our New Zealand term deposits are not protected by the insurance guarantee scheme that applies over there.

    No doubt about it, these banks are shiftier than a socialist visiting a Innovators expo

    Reply
    • @ Timoti – Well said, comrade.

      “Democracy’s key attraction for those who truly wield power is the fact that widespread belief that we are free is a cost-efficient means of control. But democracy is not and never has been Freedom; merely lite-dictatorship”.

      Much greater implications in Sam Gerram’s writings quoted. I like this guy, although I’ve only just met him.

      Reply
  7. So, any suggestions on how can protect the savings of 74 years of work etc?

    Reply
    • Go see a reputable financial advisor…..

      Avoided finance companies

      Don’t worry and be happy : )

      Reply
      • Yes Dave, fortunately I have always worked on the principle of getting good advice and then taking my own counsel. I was a worry wort for a long time and have no regrets for anything that I have done or been part of. And yes, I am trying to focus on the being happy bit as it is much more use than mere money.

        Reply
        • Its hard knowing where to put your money when our sharemarket and the finance company sector seem inhabited by sharks. Money in our major banks is pretty safe but the returns are dreadful.

          Being a bit young than you, I tend to concentrate on share investment and have started looking at peer to peer lending platforms as a way to earn a better return on cash but in a manner that spreads risk.

          Happiness and Health are priceless BJ for sure and money just a tool…

          Reply
          • Thanks mate. Seriously! I too have an interest in the share market. I earlier focussed on big oil, but now am focussing on smaller energy ie electricity/battery innovation in the expectation of demand for the replacement transport model. But for long term I would love to get into space research and technology which I really believe will be the ultimate saviour of mankind (non gender)! Think on it. A true leader is person who can paint a picture of the destination of mankind in the long term and have the ability to persuade mankind to accept the short, middle and long term goals of mankind. Alexander Pope said it in his poem ‘On Mankind”, “Know then thyself, presume not God to span, the proper study of mankind is man.” I wish I could go to Mars – the Moon would be a good start!

            Reply
  8. Blazer

     /  29th December 2015

    the real issue is PRIVATE Central bankers.Only governments should be responsible for creating money.It makes a mockery of productivity and is an affront to personal industry, that a priveleged few can in effect rule the world through this construct of private money creation ,a tiumph of form over substance.

    Reply
  9. unitedtribes2

     /  29th December 2015

    They do it by means of the creation of an imaginary thing called debt. We then undertake to pay these fictional notions back, and do so with interest.”
    The article is inferring we are the ones signing up to this presumable by buying a house with 20% deposit and the bank creating the other 80% debt. This is not correct because the seller of the house gets the other 80% debt in bank cash. So even if the bank borrows extra for the transaction the cash actually exists

    Reply
    • Blazer

       /  29th December 2015

      fractional reserve banking does not work the way you describe…the so called ‘bank cash’ does not exist.Only about 3% of money in the economy actually physically exists.

      Reply

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