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THE GLOBAL FINANCIAL MELTDOWN
#24
A TIME FOR REVOLUTION
http://larouchepac.com/news/2007/08/10/l...ution.html

Upon hearing how much money was dropped by helicopter internationally yesterday in a futile effort to prevent a meltdown of the entire financial system, Lyndon LaRouche observed that in the U.S. alone the rate at which the Federal Reserve emitted money ($38 billion in three separate injections) was an order of magnitude of the annual income of the U.S. Internationally, the total was in the hundreds of billions of dollars. On Thursday, the European Central Bank (ECB) had injected 95 billion euros and on Friday another 61.5 billion euros. Central Banks in Japan and Australia also threw up a wall of money in a desperate effort to stanch the bloodletting. Other Central Banks said they were on standby and would follow the others like lemmings if necessary. But this was all to no avail as markets collapsed in Asia, Europe, and Ibero America. Even in the U.S. the Dow ended down.

As Lyndon LaRouche said, the U.S. and the world at large are entering a phase very similar to what happened in Germany in 1923. Back then the hyperinflationary bubble was relatively isolated to one country--Germany. Thus, it was possible to have an outside intervention through the Dawes Plan to at least temporarily restore some order. However, today, since the crisis is international, no one can provide the equivalent of a Dawes Plan. The world as a whole is now in a condition which requires a general reorganization of the international financial system into a fixed exchange rate system. The entire world financial system must now be put through a financial reorganization. Given the rate at which Weimar 1923-style hyperinflation is now hitting the U.S. economy and also the world economy, an immediate reorganization of the type specified by Lyndon LaRouche is now urgently needed.

The action required is for the United States to call in Russia, China and India as the core nations to deal with the problem. That, of course, requires the ouster of Cheney and the leadership of Lyndon LaRouche.

From the standpoint of the urgency of the situation, what is now required is not commentary, but action.

Lyndon LaRouche developed the moral standpoint from which we must act. We are not going to bail out any of the speculators who have created this mess. Jim Cramer can scream all he wants. We are not going to bail out him or his associates. We are going to act to save the U.S. economy and to create a decent order in world affairs. People better get used to it, because that is the way it has got to be.

We have to have a bail out of the people, not of the speculators. The predatory speculators did this to the world economy. Our government submitted to their predatory regime. The U.S. economy can and must be saved, but only if we don't try to save the speculators. They created the mess. They are going to suffer the consequences. We will save the banks, as opposed to the speculators, because the banks are necessary to keep flows of credit going into the real physical economy. But the speculators created the John Law Bubble and they are going to eat it.

Today, the ghost of Herbert Hoover is speaking through the body of George W. Bush, promising a "pot in every chicken." The only problem is that the price of a dub has suddenly gone up. You now need a wheel-barrel full of $500,000 bills to pay for it.

Don't have any illusions that there are experts somewhere who know what the problem is and how to solve it. People who might otherwise be described as sensible are not answering their phones in the middle of the crisis. They are hiding. They don't want to talk.

In this kind of crisis, which Lyndon LaRouche has uniquely forecast and is uniquely prepared to solve, in which no one else is ready to bite the bullet, we have to say what the nature of the crisis is and what must be done. We are the only ones who can act. Lyndon LaRouche's voice must be heard and heeded. He knows what to do. The others do not. And there is no chance for this planet to survive without Lyndon LaRouche's leadership.

Therefore, as Lyndon LaRouche said: This is not a time for commentary. This is a time for revolution. This is my baby.


$323 BILLION 48-HOUR BAILOUT JUST A BAND-AID

The world central banks have poured $323 billion into the monetary-financial system in the last 48 hours, writes the British Guardian on the morning of Saturday, Aug. 11.

Screaming headlines in the British press read: "Central Banks Pour Billions-But Global Slide Continues," The Guardian; "City Hit by Biggest Crisis for a Decade," the Daily Telegraph; "World Markets under Strain of Credit Crisis," and "Dead Mortgages Create Global Panic," The Times.

The London stock market took a battering on Friday, with the FTSE 100 index losing 3.7%, wiping out over 64 billion pounds from leading shares ($130 billion). This compares with -10.84% in October 1987 and -5.72% on 9/11. Mining companies, hedge fund traders, and banks were hit hard. Big losers included Man Group, with 9%; mortgage lender Northern Rock, 9.6%; Lonim, 7%; BHP Billiton, 6.7%; Barclays Bank, 6.4%, wiping out 3 billion pounds of its market value.

The FTSE collapsed 232.9 points to 6038.3, prompting one trader to say, "This is absolutely unprecedented. In the last 15 minutes of trading we dropped 50 points. That's serious 'get me out, I don't want to be in this any more, I'm scared,'" according to today's Daily Telegraph.

Meanwhile the Bank of England has kept a low profile, saying nothing about injecting money. It does not have to make a decision because, according to the Guardian, it introduced a new money market system under which it has a permanent, unlimited standing facility available to commercial banks to draw on if they want to. The rate is, 6.75%, one percentage point above the going rate. But it is not known if it has been utilized yet, since announcements don't have to be made.

Prime Minister Gordon Brown, only last month Chancellor of the Exchequer, is quoted saying, "There will always be issues in the markets and of course we cannot insulate ourselves from events in all parts of the world. I think the important message about the British economy is that we have done everything in our power and will continue to do so to maintain the stability of the economy."

FINANCIAL CRISIS IS A GLOBAL "1929"

In interview today with the Italian daily Corriere della Sera, former Italian Finance Minister Giulio Tremonti, currently deputy chairman of the Italian Chamber of Deputies, also says that the current financial crisis is a global one.  

"For many years," Tremonti answers in the current interview, when questioned about this forecast, "I have criticized the excesses of globalization, warned against 'fatal risks', I spoke about protectionism and Colbertism. For many years, experts and wise men held me for a fool. Let us see today who is a wise man and who is a fool".

"The issue is, that with globalization, the financial economy has decoupled from the real economy and self-multiplied dizzyingly," Tremonti explains. "If a fund offers you 100 for a firm worth 10, you must worry exactly why they are offering you 100! National and supra-national authorities try to exert oversight, but it is a kind of oversight no longer sufficient in relation to the dimension and global power of finance".

On the question of whether Europe will be affected by the collapse, Tremonti answers, "I tell you three things, two negative and one positive. A crisis of the financial economy always becomes a crisis of the real economy. The crisis of America always becomes crisis of the world. The positive thing is that government and monetary authorities, if they understand it and if they want, can still intervene".

Tremonti is not asked during the interview, "what must be done about this crisis?" However, as he stated at a June 6, 2007 EIR public event in Rome, he knows very well, and substantially agrees with the solutions put forth by Lyndon LaRouche.  Tremonti's remarks are reported on in the article, "LaRouche Holds Dialogue With Italian Senators on New Monetary System"  
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THE GLOBAL FINANCIAL MELTDOWN - by moeenyaseen - 08-27-2006, 09:59 AM

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