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A Clash Of Two Systems On A Global & Historic Scale
Today 40 year veteran, Robert Fitzwilson, wrote the following piece exclusively for King World News. Fitzwilson is founder of The Portola Group, one of the premier boutique firms in the United States. Here are Fitzwilson’s observations: “One of the most interesting episodes in monetary history has to do with something called a tally stick. In ancient times, tally sticks were typically pieces of wood, bone, stone or some other suitable material upon which notches were made to denote numbers and other items worthy of memory. Over time, these tally sticks moved from the mere recording of information to functioning as money.”
© 2012 by King World News®. All Rights Reserved. This material may not be published, broadcast,
rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
July 13, 2012
Robert Fitzwilson continues:
“King Henry I of England wanted to maintain an iron fist on the creation and use of money within his realm, so he took tally sticks to a new level. Crafted out of squared and polished wood, he had notches carved into them denoting denominations. The sticks were then split evenly down the middle. He kept one half for his treasury and then distributed the other half to the inhabitants of his realm.
By requiring them to be used for the payment of taxes, he insured that the sticks would function as money....
Continue reading the Robert Fitzwilson piece below...
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“Through his monopoly on the coinage of this ‘money’, he also was reasonably assured that counterfeiting was minimized. When presented for payment, a tally stick without a matching mate probably brought about harsh consequences to the presenter.
Split tally sticks functioned as money for over 700 years. In a cruel irony, one or more of the original investors in the Bank of England paid for their shares with a tally stick. A piece of wood was exchanged for a piece of the greatest wealth- harvesting scheme ever invented. The Bank of England then went on to destroy the mainstream use of tally sticks as they adopted the fractional banking system.
To understand what is swirling all around us, we need to go back to this late 17th century period when the split tally stick system was exchanged for a money supply created largely out of thin air. The origin of the fractional banking scheme has to do with the observation by the goldsmiths that they could issue receipts many times over the amount of gold deposited for safekeeping in their vault.
As fees were earned for the service, being able to issue 8-10 receipts against the actual metal on deposit greatly amplified the income from the business. The only risk was that more receipts were presented at the same time than there was gold in the vault. The hope was that the amplified income stream harvested enough of other people’s wealth so that the shortfall could be covered or that one could leave the country before the deceit was uncovered.
Over time, these derivatives functioned as money that could be loaned. As we saw above, there was no limit on how many loans you could make. Instead of making 5% on a loan, you could create ten loans derived from the same gold on deposit. This meant that the income you generated was 50% from the ten loans. Alchemy was finally a reality.
Wealth comes from the labor and intellect of the people as well as from natural resources. It does not come from high-frequency trading and derivatives. Those are merely two of the mechanisms by which it is harvested. When visiting Europe and Rome in particular, one can see the confiscated wealth of millions of slaves, serfs, and conquered societies in the form of magnificent roads, buildings, waterways and art. Being a governor, general or emperor in late Roman history really was a license to steal the wealth of the territory in which you ruled.
The most important paragraph you will ever read is below. It is attributed to a protégée of the Rothschild family, a man named John Sherman. He is reported to have said:
"The few who understand the system, will either be so interested in
its profits, or so dependent on its favours that there will be no
opposition from that class, while on the other hand, the great body
of the people mentally incapable of comprehending the tremendous
advantage that capital derives from the system, will bear its burdens
without complaint, and perhaps without even suspecting that the system
is inimical to their interests."
The world’s money is based upon debt. It is begun by the magic of a sovereign or a government selling bonds to an entity such as the Bank of England. The Bank of England would then pay for the bonds by issuing paper money out of thin air.
The King or the government gets access to unlimited money and the banker gets access to unlimited income from the loans created from the circulation of the unlimited money. The best part of this for the bankers is that the debt underlying the money is tied to the taxing power of the state. You get unlimited income on steroids, but the existing and future wealth of the people via taxation is there in case of default.
Governments are interested in unlimited spending. Bankers are interested in unlimited income. Understanding the first two sentences of this paragraph explains everything. It is a clash of two systems on a global, historical scale. What few of us have understood is that this has been the most profitable wealth creating mechanism in the history of the world.
The Spanish Conquistadores, the English and the Dutch would have been jealous. There would have been no need to make risky voyages to hostile lands to harvest labor and resources. It is now done with simple electrons without leaving the comfort of ones home. The more debt, the more labor and resources flow back to the system.
Why is the system now becoming untenable? The answer is that the demands of debt are vastly outstripping the supply of labor and resources. This system will eventually fail. It is likely that a new version of the same thing will take its place. Alchemy does not come in many forms.
The bottom line here is this is about the control of a 250 year old wealth gathering machine. As investors, the only way to protect ourselves is to convert assets out of that system and into hard assets such as gold, silver and other resources.”
© 2012 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
The interviews with Egon von Greyerz, Bill Fleckenstein and Jean-Marie Eveillard (oversees $50 billion) are available now. Also, be sure to listen to this week’s line-up of other KWN interviews which include Michael Pento, Gerald Celente, MEP Nigel Farage, Dr. Stephen Leeb, Rick Rule and Eric Sprott by CLICKING HERE.
Eric King
