Basel II Accord and Secrets of Global Currency Issuance

2024 Author: Seth Attwood | [email protected]. Last modified: 2023-12-16 15:55

Carroll Quigley, professor of history at Georgetown University, where he mentored Bill Clinton in particular, revealed the key role that the Bank for International Settlements played behind the scenes in world finance.

Quigley is an insider raised by a powerful clique he himself called "international bankers," and his revelations are credible because he himself shared their goals. Quigley writes: “I am aware of the operations of this network, since I had the opportunity to study it for 20 years and in the early 1960s I was allowed to look through its papers and secret records for 2 years…. Although this network seeks to remain anonymous, I believe that its role in history is significant enough to become known."

Further, K. Quigley writes: “The forces of finance capital pursued another far-reaching goal - the creation of a private world financial control system with power over the political systems of all countries and over the world economy as a whole. This system was to be controlled - in a feudal style - by the well-functioning central banks of the world in accordance with agreements reached at frequent private meetings and conferences. The top of the system was supposed to be the Bank for International Settlements located in the Swiss city of Basel - a private bank owned and operated by the central banks of the countries of the world, which are themselves private corporations."

The key factor in the success of this plan, according to K. Quigley, was that international bankers would put under their control the monetary systems of various countries and manipulate them, while maintaining the appearance of these systems being controlled by national governments. A similar idea was expressed in the 18th century by the founder of the most influential banking dynasty, Mayer Amschel Rothschild. In 1791, as you know, he uttered: "Let me issue money, and I will not care who rules." His five sons were sent to the main capitals of Europe - London, Paris, Vienna, Berlin and Naples - with the aim of creating a banking system outside the control of the respective governments.

The economic and political systems of states will be controlled not by their citizens, but by bankers. In the end, it turned out that in almost every country a private "central bank" was established, and the system of such central banks gained control over the economies of the countries of the world. Central banks have been given the authority to print money for their countries, and from these banks governments have to borrow money in order to pay off their debts and finance their activities. As a result, we have a global economy created by a banking monopoly under the leadership of a network of private central banks, in which not only industry, but also governments themselves live off loans (that is, on debt). And at the head of this network is the Basel Central Bank of Central Banks - the Bank for International Settlements.

In an April 7 article in the London Telegraph entitled “The G20 has brought the world one step closer to the introduction of a world currency”, Ambrose Evans-Pitcher wrote: “One article in paragraph 10 of the communique of the G20 leaders is tantamount to a real revolution in the field of world finance: an agreement has been reached support the issuance of Special Drawing Rights, which will inject $ 250 billion into the global economy and thus increase global liquidity. Special Drawing Rights are the IMF's dormant currency for half a century … In fact, the G20 leaders have activated the IMF's ability to start creating money … thereby effectively introducing a global currency outside the control of sovereign states. Conspiracy theorists will love it."

There is no doubt that there will be. The subtitle of A. Evans-Pitcher says: "With the support of the global central bank, which conducts financial policy on a scale of all mankind, the world is one step closer to the introduction of a global currency." Here the question cannot but arise, who is going to take on the role of the "global Central Bank", authorized to issue world currency and conduct monetary policy on a worldwide scale?

At a meeting of representatives of national central banks in Washington in September 2008, the question of what structure could act in this truly fearsome role was discussed. The former head of the Bank of England said: "The answer may already be right under our noses - the Bank for International Settlements …".

If the conspiracy theorists pass by the plans to introduce a global currency uncontrolled by any governments, they simply will not be able to ignore the fact that the Bank for International Settlements will lead this process. Scandals have not ceased to shake this bank since then, in the 30s of the last century, it faced accusations of complicity with the Nazis. Founded in the Swiss city of Basel in 1930, the Bank for International Settlements has earned a reputation as "the most exclusive, mysterious and influential supranational club in the world." Charles Highham writes in his book Business with the Enemy that in the late 1930s the Bank for International Settlements was openly pro-fascist. This theme was developed in the BBC program "Bankers who collaborated with Hitler", which was released in February 1998 (2). After Czechoslovakia brought charges against the Bank for International Settlements of laundering the proceeds obtained by the Nazi regime from the sale of gold stolen in Europe, the US government at the Bretton Woods Conference in 1944 tried to pass a resolution demanding its liquidation, but representatives of central banks managed to hush up case.

In Tragedy and Hope: A Modern World History (1966), Carroll Quigley - he was professor of history at Georgetown University, where he mentored Bill Clinton in particular - revealed the key role that the Bank for International Settlements played behind the scenes in world finance.

Quigley is an insider raised by a powerful clique he himself called "international bankers," and his revelations are credible because he himself shared their goals. Quigley writes: “I am aware of the operations of this network, since I had the opportunity to study it for 20 years and in the early 1960s I was allowed to look through its papers and secret records for 2 years…. Although this network seeks to remain anonymous, I believe that its role in history is significant enough to become known."

Further, K. Quigley writes: “The forces of finance capital pursued another far-reaching goal - the creation of no less than a private world financial control system that has power over the political systems of all countries and over the world economy as a whole. This system was to be controlled - in a feudal style - by the well-functioning central banks of the world in accordance with agreements reached at frequent private meetings and conferences. The top of the system was supposed to be the Bank for International Settlements located in the Swiss city of Basel - a private bank owned and operated by the central banks of the countries of the world, which are themselves private corporations."

The key factor in the success of this plan, according to K. Quigley, was that international bankers would put under their control the monetary systems of various countries and manipulate them, while maintaining the appearance of these systems being controlled by national governments. A similar idea was expressed in the 18th century by the founder of the most influential banking dynasty, Mayer Amschel Rothschild. In 1791, as you know, he uttered: "Let me issue money, and I will not care who rules." His five sons were sent to the main capitals of Europe - London, Paris, Vienna, Berlin and Naples - with the aim of creating a banking system outside the control of the respective governments.

The economic and political systems of states will be controlled not by their citizens, but by bankers. In the end, it turned out that in almost every country a private "central bank" was established, and the system of such central banks gained control over the economies of the countries of the world. Central banks have been given the authority to print money for their countries, and from these banks governments have to borrow money in order to pay off their debts and finance their activities. As a result, we have a global economy created by a banking monopoly under the leadership of a network of private central banks, in which not only industry, but also governments themselves live off loans (that is, on debt). And at the head of this network is the Basel Central Bank of Central Banks - the Bank for International Settlements.

Behind the scenes. For many years, the Bank for International Settlements tried to remain invisible and functioned behind the scenes in the building of a former hotel. There, decisions were made on the depreciation or support of national currencies, on the current price of gold, on the regulation of offshore banking, on raising or lowering short-term interest rates on loans. However, in 1977, the Bank for International Settlements parted with anonymity and moved to a building more adapted for its activities - an 18-storey round skyscraper, which rose above medieval Basel like a nuclear reactor from nowhere. Soon the name of the Basel Tower stuck to it. Today, the Bank for International Settlements is not accountable to the government, does not pay taxes and has its own police (4). In accordance with the plan of Mayer Rothschild, he stands above the law.

Currently, 55 countries are members of the Bank for International Settlements, but the club, which meets regularly in Basel, is much narrower. It has its own hierarchy. In 1983, Edward Jay Epstein argued in an article in Harper's entitled "Managing the World of Money" that real business is done in a kind of internal club, which includes about half a dozen representatives of the central banks of countries such as Germany, USA, Switzerland, Italy, Japan. and England, more or less in the same financial boat.

“The border separating this inner club from other members of the Bank for International Settlements,” writes E. D. Epstein, - is a firm conviction that central banks should act independently of their governments … The second - closely related to the first - is the belief that the fate of the international monetary system cannot be trusted by politicians."

The Basel Committee on Banking Supervision was established in 1974 by the governors of the G-10 (now the G-20) central banks. The Bank for International Settlements provides this Committee with a Secretariat of 12 people, and the Committee, in turn, establishes the rules of banking at the global level, including capital adequacy ratios and methodologies for assessing reserves. Joan Venon wrote in 2003 in her article "The Bank for International Settlements Calls for a Global Currency": "The Bank for International Settlements is the place where representatives of the world's central banks meet to analyze the state of the world economy and decide how to proceed. so that even more money falls into their pockets - after all, it depends on them how much money will be in circulation and what interest will be assigned to governments and banks that receive loans from them … Realizing that the threads of the world monetary system are in the hands of the Bank for International Settlements, you realize that it is in their power to cause a financial boom or financial disaster in any country. If a country doesn't agree to what creditors want, they just have to sell its currency."

Controversial Basel Accords The ability of the Bank for International Settlements, at its discretion, to strengthen or destroy the economies of various countries was fully demonstrated in 1988. Then the Basel Accord was proclaimed, according to which the capital adequacy ratio was increased from 6% to 8%. At that time, Japan was the world's largest creditor, but Japanese banks were inferior in capitalization to their largest international counterparts. The increase in the capital adequacy ratio forced Japanese banks to reduce the volume of lending, which turned into a recession for the Japanese economy, similar to the one that the United States is currently experiencing. Property prices fell and numerous loans defaulted due to inadequate collateral. As a result, events began to develop in a downward direction, banks suffered total bankruptcies and - although the word itself was not used to avoid criticism - ended up with their nationalization.

An example of collateral damage caused by the Basel Accord was the suicide epidemic among Indian farmers who were denied access to credit. According to the capital adequacy ratios introduced by the Bank for International Settlements, loans to private borrowers should be risk-weighted, and the degree of risk should be determined by private rating agencies. Their rates were prohibitively high for farmers and small businesses. As a result, banks assigned a risk level of 100% to loans issued to such borrowers and, as a result, tried not to issue loans to them, since more bank capital would be required to secure them.

Something similar happened in South Korea. An article published in the December 12, 2008 in the Korea Times titled “Bank for International Settlements Launches Events in a Vicious Cycle,” said that Korean entrepreneurs, despite having decent collateral, are unable to obtain current loans from Korean banks, and this is at a time when the economic downturn calls for increased investment and easier access to credit: "Since the financial crisis reached full swing in September, The Bank of Korea has provided more than 35 trillion won to banks," said a Seoul-based economist. who chose to remain anonymous. - However, this did not give any results, since banks prefer to keep liquidity in safes. They simply do not issue loans, and one of the main reasons for this situation is that in order to stay afloat they need to maintain the capital adequacy ratio at the level corresponding to the standards of the Bank for International Settlements … "…

“A similar point of view was expressed by Professor of Economics at the University of Cambridge, Chang Ha-Jun. In a recent telephone interview with the Korea Times, he stated, “It is contrary to the interests of society as a whole that banks do in their own interests or to comply with Bank International Settlements' capital adequacy ratios. It's badly thought out."

In the Asia Times' May 2002 article "The World Economy: Bank for International Settlements Vs. National Banks," economist Henry Liu argued that the Basel Accords "forced national banking systems to dance with one tune, to adapt to the needs of highly complex global financial markets, regardless of development needs. their own national economies”. He wrote: “It suddenly turned out that national banking systems were thrown into the harsh embrace of the Basel Accords imposed by the Bank for International Settlements, and otherwise they face the need to pay ruinous insurance premiums when receiving international interbank loans … It suddenly turns out that national policy is subordinated to the benefit of private financial institutions, all the constituent parts of which are included in a hierarchical system directed and controlled by New York banks playing key roles in the monetary system …"

“The IMF and the international banks regulated by the Bank for International Settlements are one team: international banks are recklessly lending to borrowers from transition economies to trigger a crisis on foreign as a carrier of the monetarist virus, and then international banks come, acting as vulture investors and for the sake of saving the financial system buying up inadequately capitalized, insolvent, from the point of view of the Bank for International Settlements, national banks."

According to G. Liu, the irony is that, in fact, developing countries with their natural resources do not need foreign investment, because of which they find themselves in the trap of indebtedness to external forces. "As the state theory of money (according to which the sovereign people have the right to put their own currency into circulation) shows, each government can finance with its own currency all the needs of internal development and provide full employment without inflation."

When governments fall into the trap by agreeing to loans in foreign currency, their countries become debtors, obliged to obey the rules set by the IMF and the Bank for International Settlements. They are forced to send their products for export only in order to earn the foreign currency necessary to pay interest on debts. Those national banks whose capitalization will be deemed "inadequate" face tough requirements similar to those imposed by the IMF on debtor countries: they are required to increase capitalization requirements, write off and liquidate debts, restructuring based on the sale of assets, layoffs of employees, layoffs, reducing costs and freezing capital investments."

“In complete contradiction with the logic that smart banking should promote full employment and development-based growth,” notes G. Liu, “the Bank for International Settlements requires high unemployment and degradation of national economies, presenting it as a fair price to be paid for the existence of a private banking system”.

Domino effect: last dice. While banks in developing countries were subject to sanctions for not meeting the capital adequacy ratios established by the Bank for International Settlements, large international banks, whose activities were precisely associated with colossal risks, managed to evade their implementation. The mega-banks managed to get rid of the Basel rules by separating credit risks and selling them to investors using derivatives known as credit default swaps.

However, the game plan did not at all provide for US banks to avoid the networks of the Bank for International Settlements. When they managed to get around the first Basel Accord (Basel I), the Basel II Accord came into being. The new rules were established in 2004, but the corresponding obligations were imposed on US banks only in November 2007, a month after the Dow Jones broke a record high of 14,000 points. Since then, there has only been a decline. Basel II has affected American banks in the same way that Basel I has affected Japanese banks - they are now struggling to stay afloat.

The Basel II Accord obliges banks to bring the value of their marketable securities in line with their “market price”. This requirement - revaluation of assets in accordance with their current market value (9) - theoretically makes sense, but the whole point is when to apply it.

This requirement is imposed ex post facto, after assets that are difficult to bring to the market have formed on the balance sheets of banks. Lenders, whose capitalization was considered sufficient to continue their activities, suddenly found out that they were insolvent. At least they would have turned out to be so if they tried to sell their assets - the new rules presuppose this approach.

Financial analyst John Berlau laments: “Such a crisis is often referred to as a market fiasco, and the expression 'revaluation of assets in accordance with their current market value' would seem to support this interpretation. In essence, the rule of revaluation of assets in accordance with their current market value is deeply anti-market, and following it prevents the natural adjustment of the free market price mechanism … Such reporting rules do not give market players the opportunity to hold assets if the current market supply does not suit them and this is an important way of behaving in the market, contributing to pricing in a variety of sectors of the economy from agriculture to the trade in antiques."

The imposition of the rule of revaluation of assets in accordance with their current market value instantly turned into a freeze on lending for American banks, which, in turn, had devastating consequences not only for the US economy, but for national economies around the world. In early April 2009, the US Accounting Standards Board finally relaxed its requirements for revaluing assets in accordance with their current market value, although the modifications it introduced were deemed insufficient by many critics. And this step itself was not taken at all because the intentions of the Bank for International Settlements have undergone changes.

This is where conspiracy theorists come in. Why did the Bank for International Settlements not withdraw - or at least not modify - the Basel II agreement after it became clear to what devastating consequences it was leading? Why was he inactive when the world economy collapsed? Is the goal to create chaos in the economy on such a scale that the world will happily throw itself into the arms of the Bank for International Settlements, which is preparing to introduce the privately-created global currency? The intrigue is getting tighter …