Sunday, 30 March 2014

If any politician – bureaucrat or media person can't articulate a response to the question of money – they are not fit for their position!

The question of all public representatives - bureaucrats and media remains - given the level of evidence and admissions this document contains below - from the very mouths - of the very senior most levels of international high finance - that ends can not meet in the Anglo-Saxon heritage private central banking network of nations entirely interest bearing - private debt based money system structures - can they please prove how under current terms and conditions growth can exceed the debt you are forced to take on to attempt to achieve growth without first bankrupting the senior most balance sheet of sustainable natural resource collateral - if not! - when can we expect them to start doing something of substance in regards to researching the necessary reforms being discussed at the very senior most levels of international high finance to fix the current ever growing systemic inequalities of it?

Please read from the most recent quarterly bulletin of one of the very most senior global financial institutions - the Bank of England - what maybe the greatest disclosure of modern times in regards to just what is at the end of the discount interest chain and just how the private central banking network gets its funds to loan out at interest to target nations;

"Where does money come from? In the modern economy, most money takes the form of bank deposits. But how those bank deposits are created is often misunderstood. The principal way in which they are created is through commercial banks making loans: whenever a bank makes a loan, it creates a deposit in the borrower’s bank account, thereby creating new money. This description of how money is created differs from the story found in some economics textbooks."

Please watch the videos and read the pdf links from the Bank of England quarterly bulletin contained in this article below - then quite frankly if you cant figure out we are being ripped off - you deserve to keep getting ripped off! Money creation in the modern economy.

The Bank of England handbook of the private central banking network makes clear the discount interest chain pathway and New Zealand's placement in the system - especially Chapter 1 - General - and - Chapter 2 - International Practice;
Centre For Central Banking Studies Bank of England
Primary Dealers In Government Securities Markets
Handbooks In Central Banking No6 1996
Pg 6-7
1 General
The basic objective of a government debt manager is to cover the government's borrowing needs as cheaply as possible. To accomplish this objective, both primary and secondary markets need to be broad and efficient and the secondary market, if at all possible, deep and liquid. There are several ways of trying to achieve this but many OECD countries appoint a group of highly qualified financial firms to play a role as specialist intermediaries in the government securities markets between the authorities on the one hand and the market on the other. These are generally called primary dealers - as for example in. the United States - but they are sometimes referred to simply as market-makers. In the government securities market in the United Kingdom they are known as gilt-edged market-makers (or GEMMS - the term "gilt-edged" is used to describe government securities), while in France they are called specialists in Treasury securities (SVTs). In this Handbook the terms "primary dealer" and "market- maker" are used largely without distinction.
In return for a set of obligations, such as making continuous bid and offer prices in marketable government securities or submitting reasonable bids in the auctions, these firms receive a set of privileges in the market. The nature and content of these obligations and privileges varies greatly from country to country. In some cases there are firms which play the role of primary dealers without formal official recognition but nevertheless with a degree of official encouragement.
Of course, setting up a primary dealer system should not be undertaken in isolation from the authorities establishing a market-oriented monetary policy, developing a well-functioning money market and following a reasonably steady and predictable issuing policy, without which no-one is likely to embark on dealing in government securities or to make a regular profit out of it. And for some countries in transition at least, it should be recognised that the normal development of a primary dealer system will be out of existing banks according to the "universal bank" model; primary dealers should not necessarily be thought of as stand-alone securities firms on the "anglo saxon" model.
2 International practice
Primary dealers have existed for some time, for example in Canada, France, Italy, Spain, the United Kingdom and the United States of America. These countries all use official recognition as an incentive: it is granted under specific conditions and the "licence" thus created is reviewed from time to time. Ireland has recently introduced this system as appropriate to the stage of development of its market.
By contrast, in Australia, Germany, Japan, Netherlands and New Zealand there are no formally designated primary dealers, although in these countries a group of firms do collaborate in the allocation and proper development of the market in an informal way. In Germany and Japan the governments raise part of their financing needs through syndicates, although nowadays the greater part tends to be raised by systems offering more open access; the liquidity of both markets has been partly ensured by the strength of the respective currencies.
A primary dealer system can be particularly helpful in the transition from a directed to a fully market-based system for the sale, transfer and redemption of government securities. India would appear to present such an example.
End quote

Banking in New Zealand Fourth Edition - published by the New Zealand Bankers Association in 2006 - makes it very clear that presently every dollar of currency circulating in New Zealand's money system originates as an interest bearing loan owed to a foreign private owned lending institution and - that New Zealand's money system is presently administered by an international private central banking network - of which currently sits at the end of a wholesale credit liquidity discount interest chain - an accountancy system of credit weighed against available natural resources - as opposed to the re-lending of already existing pools of liquidity as often portrayed.

Excerpts from the document -
what Actually Happens in reality, although the process outlined in the previous sections could occur, cash balances in bank vaults no longer act as a constraint on bank lending in the way that they might have up until the latter part of the 20th century.......
in such an environment, there is still scope for a bank to expand its lending and create credit, but it is dependent on there being net inflows of funds into the banking system as a whole. These inflows of funds may come from depositors from outside new Zealand (and we have seen significant inflows of funds from such sources in recent years), or from the government making net deposits of funds into the banking system (through its fiscal policy, as outlined below).
We also have a situation where, since 1985, new Zealand banks have not had any specific reserve requirements applied to their deposit liabilities. This means that, in theory, banks could keep on creating credit and expanding their loan portfolios indefinitely. in such an environment, it is the cost of credit, based upon the costs that banks have to pay to raise the deposits, that becomes the constraint on the quantity of credit that is created.

These official government documents make it very clear that New Zealand's public servant's have condoned the contracting out of public central banking authority to a foreign private central banking network - the question must be asked - why?;
Government Securities Tendering Operations
Page updated 30 Jan 2009 (please toggle down to first pdf Feb 2008 to see how original wording has been altered since new National Party Government was elected Nov 2008)
The original from 7 April 2007 stated this;
New Zealand Debt Management Office (NZDMO) has assumed responsibility for the tendering of New Zealand Government Bonds and Treasury Bills from the Reserve Bank of New Zealand (RBNZ), which had previously acted as an agent for the NZDMO for many years.
Was changed to this January 2009;
As at 7 April 2008, the New Zealand Debt Management Office (NZDMO) has been responsible for the tendering operations of New Zealand government bonds and treasury bills.
Visit here to witness deception - just toggle down past the bizarre disclaimer - ignore it -

More here re New Zealand Debt Management Office that operates under New Zealand Treasury umbrella;

New Zealander's are prevented from knowing where their currency as debt comes from! New Zealander's can ask under the Official Information Act - who are the wholesale credit liquidity providers the country deals with? - but you will not be told on the basis of this exemption;

The below exemption used to appear in the securities exemption section of the now defunct Securities Commission website that has since been replaced by the Financial Markets Authority - which no longer has an obvious exemption section but - the exemptions can be found by typing 'exemptions' in the home page search box!

Secrecy By Securities Commission Exemptions at the Sovereign Debt Level
Securities Act (Crown Wholesale Debt Securities) Exemption Notice 2004
Gazetted on 26 August 2004
Expires on 31 August 2009
(expires 31-8-2014)
Effects of the exemption
Investment statements for debt securities originally allotted by the Crown and onsold to the public will contain information about the Crown as the issuer of the securities, but will not be required to contain information about the wholesale investors offering the securities.
Before subscription, investors will be given the name and contact details of the offeror, and information about where and to whom payments are to be made. The investment statement will state that this information will be provided to investors before subscription.
The Crown offers debt securities such as New Zealand Government Bonds on a regular basis to wholesale investors, who then sell these to the public on the secondary market. The Crown is solely responsible for repayment of principal and interest in relation to these securities. The Crown provides investment statements for the wholesale investors to provide to retail investors. This exemption replaces the Securities Act (Crown Wholesale Debt Securities) Exemption Notice 1999 which expired on 31 August 2004

Secrecy of debt dealings now also applies to Local Government Authorities;
Securities (Local Authority Exemption) Amendment Bill
This bill amends the Securities Act 1978 to provide local authorities with an exemption from the full disclosure requirements of that Act when issuing debt securities to the public. This reduced disclosure requirement will exempt local authorities from the requirement to produce a prospectus signed by all councillors when issuing debt securities to the public.

An entire highest level international high finance conference was held exposing the consensus that Interest Rate Inflation Targeting - that New Zealand Reserve Bank Governor - Don Brash - was used as the flag bearer for - has completely failed and the admission from IMF Chief Economist Olivier Blanchard that under the current entirely interest bearing debt money system outputs can never cover the cost of inputs was made;
Video here;

and pdf of speech here;
Current Imf Chief Economist Olivier Blanchard said - 
“The implicit assumption was that stable inflation would deliver economic stability in the larger sense, in the sense of a stable output gap. This was the case in many formal academic models, in particular in the benchmark ―New Keynesian model, which displayed a property Jordi Gali and I called the ―divine coincidence. In these models, if you maintained stable inflation you would also maintain a stable output gap. The two went together, so there was really no reason to look at the output gap separately.
Realism on the part of central bankers made them realize that this was an extreme proposition, that there could be, at least in the short run, some distance between the two, and that they had to worry also about the output gap. That led to something called ―flexible inflation targeting, in which central banks allowed for temporary deviations from the inflation target in order to stabilize what they thought was the output gap.
Now we come to the post-crisis consensus. I’ll go through one version of it, and then through another one. We learned two main lessons from the crisis:

The first is that you can have stable inflation and a stable output gap, but things are not going well behind the---macroeconomic---scene. For example, tensions are building up in the financial sector, and financial instability eventually translates into major problems in terms of output and activity. This has led to a general consensus that the list of targets must now include financial stability, in addition to macroeconomic stability.

There is also agreement that the debate as it was framed pre-crisis – whether you should use the policy rate to try to achieve both macro and financial stability—was not the right debate. Basically, there is a whole set of instruments out there, not just the policy rate. There is no reason to rely only on the policy rate.

The second lesson is that the link between inflation stability and the output gap is probably much less tight than we pretended. In a number of countries, the behavior of inflation appears to have become increasingly divorced from the evolution of the output gap (This is clearly hard to prove, given that potential output and, by implication, the output gap are unobservable). If this is the case, then central bankers, when they care about macro stability, cannot be content just to keep inflation stable. They have to watch both inflation and the output gap, measured as best as they can. Nobody will watch the output gap for them.”
end quote

Given the concerns from some very senior most academics of the very senior most institutions of international high finance that in international trade agreements investor state commercial contract laws of corporations is undermining common law social protections of societies – I think the sooner the better that New Zealand's politicians – bureaucrats and media start looking into the obvious shortcomings of New Zealand's current money system structures or the honest citizens and businesses of legitimate enterprise outside of criminal high finance are going to be reduced to peasant tenantry in their own land.

Joseph E. Stiglitz - 2001 Nobel Laureate of Economics and former World Bank Chief Economist – about the Trans-Pacific Partnership Trade Agreement between 12 Pacific Rim nations currently being negotiated in secret behind closed doors;

Joseph Stiglitz March 15, 2014 - On the Wrong Side of Globalization;

“Negotiations for the TPP began in 2010, for the purpose, according to the United States Trade Representative, of increasing trade and investment, through lowering tariffs and other trade barriers among participating countries. But the TPP negotiations have been taking place in secret, forcing us to rely on leaked drafts to guess at the proposed provisions. At the same time, Congress introduced a bill this year that would grant the White House filibuster-proof fast-track authority, under which Congress simply approves or rejects whatever trade agreement is put before it, without revisions or amendments.

Controversy has erupted, and justifiably so. Based on the leaks — and the history of arrangements in past trade pacts — it is easy to infer the shape of the whole TPP, and it doesn’t look good. There is a real risk that it will benefit the wealthiest sliver of the American and global elite at the expense of everyone else. The fact that such a plan is under consideration at all is testament to how deeply inequality reverberates through our economic policies.

Worse, agreements like the TPP are only one aspect of a larger problem: our gross mismanagement of globalization.

So New Zealand politicians – bureaucrats and media – I have completely played the ball and not the man on this and – if you got to here – ignorance is no longer a legitimate excuse for you.

My essay of contemporary money system flaws and details of high level discussion of how it might be fixed are here;

To whom it may concern,

Attempting to form public policy for equal economic opportunity of all citizens without a full knowledge of the fundamentals of money as invented and intended - that this submission details - is doing so by looking at 1/3 of a many piece puzzle forced together in frustrated confusion - thinking its complete - when 2/3 of the picture needed in the middle to make clear sense of it all - is in-fact one large piece that has been hidden by a self serving few to steal from wider society under false pretences.

Professor David Miles, Monetary Policy Committee, Bank of England;
"The way monetary economics and banking is taught in many – maybe most – universities is very misleading"

Iain Parker.