The Worldwide DEBT is the problem.

The Worldwide DEBT is the problem.

The best solution for the present economic crisis would be a REBOOT or restart of the entire debt system for the ENTIRE WORLD.

1. A data base listing ALL DEBT, government, business and personal needs to be created. The list would need to list the debt and debt holder with a bank that could make an accounting of the debt. Included would be all national debt of all nations, all mortgages car notes and credit cards for individuals. All outstanding bond and other debt for corporations, The idea is to list ALL DEBT of any kind owed.

2. Every government on the planet would need to call a special session of its legislature. Using the same authority that governments have to use or create FIAT CURRENCY the legislatures and Central Banks need to authorize the creation of ACCOUNT CREDIT in an amount equal to all the listed debts in the world.

3. The Various governments and Central Banking Systems then need to make an accounting change equal to the debt in the form of an ACCOUNT CREDIT or CREDIT zeroing out ALL THE DEBT in the entire world, and crediting all debt-holders in the world.

The following day the economy of the entire world would restart and the Stock Markets of the world would react to the new renewed capital in the banking systems, the Capital now available to restart all business and the disposable income to the individual people would restart and grow the retail sectors and the manufacturing sectors of the entire world.

Some have commented that if this was done in a very short time the exact problem would be repeated. My answer to this idea is history does recycle and repeat itself but some do learn and avoid making the same mistake. Europe learned after WWII and has avoided a major repeat for more than sixty years.

The other objection has been the possible inflation that would result would weaken the dollar. My answer to the weakened dollar is it may be a GOOD thing to help our ability to export manufactured products and also make our manufactured products more competitive in our own country. Jobs are needed for our own citizens especially the bottom forty percent.

Allen Charles Report

http://allencharlesreport.blogspot.com/

The Debt Realignment Initiative: A Better Idea than The Bailout

I was gathering my thoughts concerning the Year of Jubilee and how it might relate to today’s problems with the banks and the mortgage crisis and then found this address listed in a comments section at a newspaper site. I believe the writer has proposed a valid and maybe even Biblical method to address this crisis. His plan is sound,simple and should be put in place ASAP. I can not improve on it so I post it here as written by Samuel Margolies.

My one commit and belief is that an idea or revelation is often given by God to one person and then becomes available to all that will accept it, so all of us need to be open to accepting what may at first glance be out side the box of our normal way of thinking.

http://www.thedebtrealignmentinitiative.com/Debt_Realignment.html

Debt Realignment - By Law Done Only Once

Worldwide, we are in an extreme circumstance financially and economically. Debt realignment offers a moral, pragmatic, available means to end the debt that plagues the world and restricts the use of resources and credit. Debt is a burden on people, resources, time, and capital. Deficit spending is sometimes necessary. Events happen, circumstances change, emergencies occur. A country must have full utility of its assets. This is only one reason why a robust economy is so crucial. But when the debt becomes so large, and the only strategy is to look the other way and hope something positive will happen in the future -- and nothing happens, the debt just keeps getting bigger over the years, it needs to be addressed. And with the present financial crises worldwide, it is obvious some means needs to be put in place to end this as quickly as possible and get the world economy back on track. Global debt realignment will enable a better track, however, wider, smoother, more efficient with avenues, venues, and projects we only dream about now, and some we have yet to consider. In each country all projects can be funded, and the global financial meltdown is vanquished at the same time. What is hoped is that once on the other side of debt realignment we learn from the past and do not repeat the same mistakes. This crisis is an opportunity. If it is taken.

Proposal:

It is proposed that an Economic Summit be called among the nations of the world. At this Summit, with agreement among all national executives, legislatures, and central banks that this be done only once, by law, it shall be ordered by all governments that in all ledgers, all balance sheets, all accounts in the computers around the world, and on the books of all central banks and institutions that all debt be transferred as an asset, as a credit, to all creditor's accounts in their respective banks either in real terms, or as a ratio of the present debt, to be determined, to get all on an even playing field as of January 1, 2009. If this is done in present real terms, or as a ratio, this means currencies will have to be realigned also if not doing so would promote inflation. Negotiations and discussions on this obviously will have to take place among the nations. This writing provides the direction, the outline, hopefully the impetus for this to be a reality. The specifics shall be determined by the various experts of different countries, the executive branches, and the central banks at the Summit.

The goal is zero global debt among nations. The Summit should occur before the end of 2008 with the debt realignment event date being in the first part of 2009. The sooner the better. If the Summit can occur quickly the event date actualizing debt realignment can be January 1, 2009. It can be done. It takes vision. It takes courage. It takes effort. It takes leadership. The European Union has also suggested a Summit, but at a Summit there must be a global plan that will work.

The world would welcome a plan that will work. This plan will work.

All creditors receive payment.

All debt of nations will be released and all debtor nations released from their obligations. All holders of national debt will be credited.

No one loses anything but the debt. No one suffers. The creditor nations and international banks get asset capital on their ledgers. The debtor nations lose their debt -- worldwide. This is not debt forgiveness. No one loses. This is the essence of debt realignment.

A new balance sheet in each institution is started with oversight and regulations in place, and with a new awareness of the pitfalls of wanton speculation and poor regulation. Nations are free to prosper. People can advance. Everyone is free to put their house in order. Nations can fully focus and fund the climate challenge, put their people to work, prosper. The world can advance.

Example:

A country owes 200 billion dollars to the World Bank. Authorization is given to the World Bank to put on its books 200 billion in credit, 100%, or a ratio to be determined, derived from the debtor country's debt. Since this is being done worldwide negotiations on this may be necessary, though not mandatory, to also align currencies. The debtor country's debt is transferred as a credit. The debtor country owes no debt. The bank has credit to loan. The country is free from the debt. This can be repeated with every country, the poor and the rich. Countries are free "to promote the general welfare" without the burden of debt.

Example:

America owes over a trillion dollars in Treasury Bills to different countries. It is agreed that the holders of these bills be realigned as a credit in the amount of the debts in the bank where the debt is on the balance sheet as a debit. The executive branch, legislature, and central bank authorizes credit to the Treasury account with the outstanding debt balance as a credit. The Treasury Bills are paid off. Interest payments cease. Resources are freed. Debt is gone. We move on. It is simple. But simplicity is what we need now. We do not need wild loans putting more debt and bondage on people, resources, and countries. What if a country or fund does not want to cash in its notes? The debtor's bank -- not a debtor now -- holds the credits in its account until such time as demand is made or maturity is reached. In any event the governmental debt will equal zero after debt realignment with credits available on the balance sheet.

Precedent:

The ancient Hebrews handled massive debt every 50 years with a "Year of Jubilee," where "all were returned to their possessions." Leviticus XXV, The Old Testament.

Let us not be so sophisticated in our minds to think that there is nothing to learned from this. But this too is different from debt realignment, in that debts are not just forgiven, credits are assigned to the creditors. Debt realignment is the evolved model. With modern technology and banking expertise, it can be done. All we have to do is do it.

To be sure, the International Monetary Fund, the World Bank, and the separate Central Banks of the nations around the world will be much more comfortable, as will Wall Street, other markets, individual investors, and workers, if this is accomplished.

If I were calling the shots, I would do debt realignment across the boards, from top to bottom; that is, I would realign the debt of nations, companies, and individuals. That will provide ultimate freedom to individuals, companies, markets, nations, and the world for progress and prosperity. But getting global national debt realignment is difficult enough for most to understand and envision. Since this is an extraordinary circumstance and that debt realignment would be done only one time, it is hoped that our leaders, meeting together in an economic Summit, will go to the farthest.

Copyright 2008. Samuel Margolies. All rights reserved.

I received an email from Samuel.

Dear Mr. Charles:

Thank you for your comments and for your realizations. I heartily endorse your putting the link to my web site on yours. I have contacted world leaders, members of Congress, the Federal Reserve, and the Treasury with this idea. But as of yet they do not see what I have been getting at. It is difficult for people who think in complexities and have specializations to go outside their areas of expertise and grasp other ideas, particularly when an idea is a simple one. Humankind seems to want to make everything more complex than it needs to be.

I have made the analogy of what happens when a computer freezes up. We have no recourse but to turn off the power and then back on rebooting the system. Likewise, I believe we have to reboot the financial and economic systems of the world. Whether this occurs as I have forwarded remains to be seen.

I do not know what site you first saw my comment on, but on several I have recommended reading Barbara Tuchman's book, "The March of Folly," where Ms. Tuchman asks the questions of why leaders so often in history have made decisions that were contrary to the best interests of their constituents? This is more common than realized. In no other time was it more important that America choose the correct course. We have many challenges. We must meet each with the best decision. And this is true globally. Why would we choose a course that would lead to difficulties and more toil than is necessary? I do not believe this is deliberate. I believe the people making the decisions simply do not see the options.

I do not know how far reaching your blog is. I do know that the more people who contact our representatives and world leaders the better the chance that acceptance and implementation of debt realignment can become a reality.

Obviously, you, like me, are a believer in God. When I first addressed the issue of our national debt, I was influenced by the "Year of Jubilee." Our systems have evolved from those ancient days and we know a great deal more about many of the variables. But some things are constant.

Our national debt, and the debt of the world's nations, must be solved one day. We will not grow out of it. The debt has become too large. I hope I have made the case for numbers as representations of reality and not the reality itself. If we are to believe that it is God's purpose to make people free, does this not also mean freedom from debt, particularly overriding, overwhelming debt, which we cannot work or grow out of when we consider all the variables worldwide that are present in today's global economy?

But even if one were a strict secularist, if something works, why not use it? First, those making the decisions must see it. For them to see it , it must be shared and presented to them on many fronts. You have opened up another front, another forum for the dissemination of the idea of debt realignment. I really appreciate it. I have been alone for a long time with very little support. I do find it interesting that I do not get criticism though, I get silence. No one says it cannot work. No one. Just silence.

It may be that things will have to get worse before people are open to new ideas. This does not have to be.

There is no reason that humankind globally must go through possibly years of financial upheaval and difficulties when there is an idea that will work, one that will also enable humankind globally to enter a new age of progress.

Again thank you. And if you can get an email off to your representatives, to a media site, to world leaders to at least look at what I advocate, please do so. It would only take one world leader to see that debt realignment can be done and openly espouse it, sharing it, for its possibilities to become a reality.

Thank you and God Bless you in your work.


Respectfully,

Samuel Margolies

A good description of the REASON for the Bank Bailout Fund

I found this comment by Robert Birdwell on this site and believe Robert best describes the real reason behind the so called bailout . I post his comment unchanged as it appeared

http://www.moneymorning.com/2008/10/02/senate_bailout_bill/
Comment by Robert Birdwell on
3 October 2008:
For all of the intellectualizing, a critical point has been missed. From 1970 to 1995, we all had the most powerful tool on earth, Title 18 U.S.C. Section 1964©). The congress was conned into inserting an exception into the law. That supposedly innocuous exception removed the standing of any citizen to sue for any injury as a result of any conduct in the sale or purchase of securities, and gave exclusive standing to sue to the United States. To defeat RICO, all the United States had to do was refuse to prosecute those committing securities fraud. Injured parties were left waiting for prosecutions that never came. Thus, injured citizens had no actual recourse.

1995 was also the very time banks wanted into the securities business in a big way. It was shortly after the 1995 exception that these morphing chimera called derivatives entered the market. Soon, every type of loan, mortgage, car loan, and credit card debt, was bundled and sold as derivatives. Investment Banks and brokerage houses could not get enough debt to package and sell. The fees were huge, and easy to come by.

As derivatives became worth less and less, more and more were packaged and sold. The United States SEC and the DOJ had the exclusive power to oversee, regulate, and prosecute the criminals, since all of these securities trades were done in interstate and foreign commerce, but the SEC and the DOJ were never in the fight and intentionally refused to do so.

The perfect vehicle was the insane notion that the value of your home was going to increase exponentially, forever. Unwitting people were talked into refinancing, or selling, their existing homes and talked into participating in the greatest real estate market in history. It didn’t matter if you made $10 per hour, refinance your home and buy another one you can sell for a huge profit before the payment increases. What could possibly go wrong. You were dealing with real estate and financial experts. Everybody was doing it. It was the smart thing to do and you are not stupid! Besides, all of these people are licensed and regulated by the government!

The people running the investment banks in Europe and Asia were primed to buy into these miracle investments. They invested big.

When these began to sour, it was the foreign banks and investment houses that wanted to find a back door. That back door could only exist if the Americans bought back all of the bad paper. Threats of an economic Armageddon were made. China and others would dump our currency and debt. Sanctions would be imposed. Our economy would be destroyed. Trade would end.

The Bush/Paulson remedy was to hypothecate the future production and wealth of American citizens by creating a gigantic fund - guaranteed by the citizens of the United States - that would be used to buy back the worthless paper being held by foreigners.

$700 billion, $5 trillion, you pick the number. It doesn’t matter. Not one penny will go to help American citizens in the process of losing their homes. Not one penny will go to companies being forced out of business. Not one penny will go to domestic credit. Banks don’t need it. Banks create money out of thin air when you sign a note. Your note creates the money, more notes (federal reserve notes), but you have to pay it back with money already existing that you generate from your work.

Your life, and that of your family, for generations to come, has been pledged, by congress, as security to pay all of this back. Money you didn’t steal, but money you have to pay back.

The Emergency Economic Stabilization Act of 2008, is not what the name implies. Welcome to slavery, indentured servitude.


We can overrule it. And overrule it we must

A better Plan to save Wall Street and the taxpayers" money.

A better plan to stabilize the financial markets is to simply let the Federal Deposit Insurance Corporation take over the insolvent companies and form a holding company and reopen as one large institution. Just as when the FDIC takes over smaller banks the same rules should apply here. The new holding company can then operate the new banks keeping the good accounts and spinning the bad ones to a second operating company to work through them eventually restoring some of them and liquidating the rest. If any legitimate debt holders are established then stock could be issued to these legitimate debt holders ( likely bond holders). After a period of time this new company could do a stock offer selling the entire company back into the private sector. Problems solved, seven hundred billion of tax payers money would be saved. The cost of the new company would be returned back to the taxpayers from proceeds of the sell of the stock at the return to the private sector from government operation. The fat cats on Wall Street could be returned to work for the new company but like all reorganizations at a lower cost to the new company allowing it to return to health much faster.

Both Wachovia and Washington Mutual as well as all the community and regional banks that are or become distressed should be included in the new Holding Company thus making a network of bank outlets available to allow loans between banks to be unfrozen and allow the system to do a restart with these outlets being secure and adding the desperately needed stability to the entire banking system. If a bank becomes weak it needs to be added very quickly keeping the system calm.

The changeover could be done over a weekend without any disruption of any kind. Each of the banks taken over would continue to operate under it's present name and corporate structure except that the boards would become advisory only with the final authority being held with the new holding company. Over time most of the banks could be either spun off or several combined under a new corporate configuration and then spun off or sold. The stability of the entire banking system would be the most important goal.

The Federal Reserve System looks at all the deposits at all the banks as one total, so this new bank would not alter the loan patterns from what it would be with if all these various banks that would be part of the new holding company were operating separately. All the bad things being claimed by Mr. Paulson would be avoided with this plan and the best part of this plan are NO TAXPAYER costs beyond the administrative cost of the new bank holding company.

This plan takes a second look at the way the taxpayer’s money is used and avoids benefitting those that caused the problem to begin with. They took unnecessary risk and have lost so the bailout should take the control of the future out of these either corrupt or incompetent executives hands and allow a time out for our banking system to stabilize and get back on track.

The one caveat I have for the new Holding Company, which plans to put these bad debt mortgages in, is that a provision in the restructuring should provide a way for people that are in these mortgages to be able to stay in the home. One idea would be to renegotiate the value of the property back to an equity position with the caveat that they could not sell their home, for eight to ten years or some other appropriate time frame. The reason that I would like to see this put into the terms for use of this agency to stabilize the mortgage market is that if something isn’t done the power structure that will be controlling this new agency will likely sell off these homes at a larger loss than leaving people in the homes or working out something for them. If this doesn’t happen many insiders, the money crowd, Wall Street types you know the folks that got us in this mess to start with will come in and buy these properties up for pennies to the dollar at leaving the homeowner homeless the taxpayer on the hook for the costs and the rest us no better off than we are now. There could be a deed restriction on these homes that required them to pay the proceeds of the write-down out of the home or of the equity of the home as a penalty for moving too fast. The whole idea for this bailout is to stabilize the mortgage market, financial market, and the economy.

The Wall Street BAILOUT and FreeTrade

Just watched a movie called Bordentown. It was about hundreds of Young Mexican women that are raped and murdered in a factory town there. The story was set with an American reporter from a large city newspaper covering the story. When she had finished the story the paper then refused to print the story because of a new NAFTA type deal coming up for Central America and the corporate owners did not want the bad publicity. They said in the movie the wage was $5.00 per day 12 hour day. The newspaper boss reminded the reporter that the news was Freetrade, Globalization and Entertainment. Fits does it not?

When will you Conservatives get it? Bush is not a Conservative he is a NEOCON, "NEW WORLD ORDER" GLOBALIST. The rest of the world defines that as a NEOLIBERAL, which means using the power of government to affect social and political change.

The damage to our nation being done now with this "no strings" bailout of the Wall Street to protect the base of the Republican party from the risk they should have to absorb is just amazing. It is still more amazing the refusal of otherwise conservative folks, to not see through this scam.

These folks paid taxes at a reduced rate (15 percent tops ) because they were supposedly exposed to risk. Now the crony companies are lining up to get these properties at fire sale prices. So here we go taxpayers buy the stuff and bail them out only to sell the same stuff to crony companies to resale at huge profits. Perfect plan for Wall Street bad for the rest of us.

I know I sometimes offend folks that believe themselves to be conservatives yet I believe them to be neocons. I have a hard time with unnecessary wars, trade deals that don’t protect our workers, and the often seemingly stacking of the deck against middle class , working class folks.

The Truth About Abortion and PRO-Life and Change ?

This article is only another example of the struggle we face as a nation. The two parties will exploit anything they can to try and get that small group that will in the end settle elections. People of FAITH can be a strong group that a minority desiring control can use to build towards a small majority. Christians today have been found as necessary for the otherwise smaller Republican party. There is not likely any way the small number of wall street high income folks and corporate people could win elections with out adding other groups . They have learned to attach people of FAITH to them by using their platform as the draw. Also noone desires to pay taxes so another group can be added.

The abortion issue is a difficult problem for Christians to deal with. I am PRO-LIFE in every situation except when medically both mother and child will die anyway if the baby remains, and even then every attempt to save the child when delivered (in what ever way it can be delivered) should be done. The truth of the abortion issue is that the Republican establishment will never let it go away. If abortion was outlawed, the most faithful supporters of their party might then look elsewhere at other issues as to who to vote for. If you faithfully vote Republican now because of their pro-life platform they will never allow that to change. Unfortunately abortion is too good politically to lose as an issue. Once again the sheep are being sheered. Things being what they are I think improving the lives of women to the point none would ever want an abortion might be the best hope we may have to stop abortions from happening.

This business about which party will bring the most change kind of brings to mind the book "Animal Farm,” where all the barnyard animals want to get their freedom from the human farmer. The farmer somehow was removed and they were working (so they believed) for the benefit of themselves collectively. Before long, the story was about the Pig then living in the house and getting most of the benefits from the collective efforts of all the animals on the farm. The Christians that have become for the most part Republicans are like the animals in the barnyard believing voting Republican will help stop abortion, make the country more moral and create a better world to raise their children. The sad truth is like the Pig in Animal Farm the benefits go mostly to high income folks on Wall Street and International Corporations that move the very livelihoods these grass roots families need disparately to be able to provide for their children.

A Simple fix for Social Security

A very simple solution to the funding and saving of Social Security can be found in a simple reorganizing of the way FICA funds are handled. The first thing is for Congress to establish a National Savings and Security Bank. Next all Americans would have an account that their FICA funds are deposited in. The next step is to apply the fractional reserve requirement used by other banks. The next step is instead of a simple IOU being used to replace the surplus funds that are presently being paid by FICA withholding with a promissory note. A recent year the surplus was more than $365 Billion. The note or loan would then be funded by account credit and not by removing the actual funds from the bank. Yes if you are thinking this would be money creation you are correct. Banks create account credit every day. The fractional reserve requirement means only a fraction of the funds lent have to be on hand to be available for withdrawal. Additional loans could be made to local and state governments for their project needs. The opportunity to deposit extra money as a side fund to be received at retirement in additional to the normal Social Security could also be added. Some kind of profit-sharing method could be used to determine the earnings of the side fund. The existing program would remain the same.
If this very simple change had occurred at the beginning, the funds would be in the trillions today. If started immediately, it would save the program. The payments of the loans with interest plus the FICA would balloon the value of the funds many times the value of just the FICA alone.