JAPAN WIPES OUT DEBT… OR DOES IT?

This is an important article, and was shared by Ms. M.W.  At first glance, it seems to be good news, for the Bank of Japan is simply buying its own government's debt, effectively eliminating it.

...Or, at least, that's what we're being led to believe. Here's the article:

Sovereign Debt Jubilee, Japanese-Style

Now here's the part that concerns me:

Personal income taxes are at record highs, ringing in at $550 billion in the first four months of fiscal year 2017, or $1.6 trillion annually. But even at those high levels, handing over $830 billion to bondholders will wipe out over half the annual personal income tax take. Yet what is the alternative?

Japan seems to have found one. While the US government is busy driving up its “sovereign” debt and the interest owed on it, Japan has been canceling its debt at the rate of $720 billion (¥80tn) per year. How? By selling the debt to its own central bank, which returns the interest to the government. While most central banks have ended their quantitative easing programs and are planning to sell their federal securities, the Bank of Japan continues to aggressively buy its government’s debt. An interest-free debt owed to oneself that is rolled over from year to year is effectively void – a debt “jubilee.” As noted by fund manager Eric Lonergan in a February 2017 article...

Then comes a recommendation:

If the Federal Reserve followed the same policy and bought 40% of the US national debt, the Fed would be holding $8 trillion in federal securities, three times its current holdings from its quantitative easing programs.

Eight trillion dollars in money created on a computer screen! Monetarists would be aghast. Surely that would trigger runaway hyperinflation!

But if Japan’s experience is any indication, it wouldn’t. Japan has a record low inflation rate of .02 percent. That’s not 2 percent, the Fed’s target inflation rate, but 1/100th of 2 percent – almost zero. Japan also has an unemployment rate that is at a 22-year low of 2.8%, and the yen was up nearly 6% for the year against the dollar as of April 2017.

Selling the government’s debt to its own central bank has not succeeded in driving up Japanese prices, even though that was the BoJ’s expressed intent.

Now, all this sounds good on paper, and perhaps it would work. But there are two problems that I can see: (1) The Federal Reserve is a private corporation, and as such, selling debt to it effectively sells debt to its shareholders - and by the way, who are they? Might there be a conflict of interest here? Now, the last time I looked, when someone doesn't pay the bank, then the bank sends a gorilla to collect the collateral.

It's the collateral part here that's the problem, for the country is so badly mortgaged that the collateral might be anything, from the interstate system to the radar set at your local airport. I don't know about you, but I'd rather not see the likes of the Rockefailures and Rottenchilds turning the entire system into a toll system(which I suspect has been the game plan all along, incidentally. But that's the subject for another day).

What has occasioned all this? Well, that brings us to the second problem: (2) the complete departure of the federal government, and the congress, from constitutional provisions in the budgetary process, not to mention the issuance of money, to begin with. It's that constitutional money provision which is the foundation of all the rest, and it's perhaps that fact, that we are so far from the Constitution itself in the matter of federal finances, that is the reason two American states - Texas and Utah - have established state bullion depositories, and that other states have passed legislative resolutions concerning what constitutes legal tender.

In the meantime, the idea of a debt jubilee grows:

Rather than unwinding their securities purchases, the other central banks might do well to take a lesson from Japan and cancel their own governments’ debts. We have entered a new century and a new millennium. Ancient civilizations celebrated a changing of the guard with widespread debt cancellation. It is time for a twenty-first century jubilee from the crippling debts of governments, which could then work on generating some debt relief for their citizens.

But I would suggest that more than just a jubilee is needed. The central bank welfare-warfare model has been growing by leaps and bounds, not just with the Federal Reserve Act, but with the establishment of institutions like the World Bank, the International Monetary Fund, the Bank of International Settlements, and so on. A jubilee releasing debt still leaves the structure in place, and it's that structure that needs to be carefully examined, and audited.

See you on the flip side...

21 thoughts on “JAPAN WIPES OUT DEBT… OR DOES IT?”

  1. As long as we accept that central banks and their monopoly over our wealth are acceptable enough for us to impotently go on and on about their crimes, enlightened change is a distant dream. Let us rather use our energies creatively and do something, create a new way, and let the corruption read its own headlines.

  2. Robert Barricklow

    They’re never going to cut their debt shackles loose to free their debt slaves. On the contrary, they desire to enslave the entire globe within their dent bondage sphere of power. No doubt, the moon is already being enslaved.

    Lookout universe; the debt masters are coming for you.

  3. You can’t have predators on top of the pyramid worshiped by many thru all sorts of mind control programs and expect them not to predate.
    Rug sweeping? Hope for the Japanise not but I am not convinced.

  4. Robert Barricklow

    Americans have been increasingly encircled by a culture of fear & insecurity by design. A 221st century society that deters and erases public memory as it commercializes, monitors, and militarizes every facet of public & private life.

    1. Robert, back when my mother was elderly but alive, she would watch hours of local news. All the drumbeat of murders, muggings, robberies, etc., got her to where she was afraid to leave the house. I would talk to her and tell her that while, say, twenty Denverites had a bad day, the other million had fair-to-good days. She would mull this over, her eyes would widen and a smile would appear, and she would be good to go…

      1. Robert Barricklow

        I remember my aunt checking the news and stuck on how great Rachael Maddow was. I tried to tell her, even though she was better than some other talking heads, she was still a paid shill for a party that sold the people out years ago. Still, Rachael was her gal to watch.

        What chooses do the corporate own air waves have? None, if your wanting a Republic.

  5. A the article undermines itself in the first delusional paragraph, we’ve been reading this kind of thing since at least the 1930s:

    “Let’s face it. There is no way the US government is ever going to pay back a $20 trillion federal debt. The taxpayers will just continue to pay interest on it, year after year.”

    There are all sorts of ways of paying off debt legally, but then certain parties directly linked to Trump lose power–Wilbur Ross for one.

    Right, it’s interesting that Japan is effectively saying sod the bond markets.

    Perhaps that 27 trillion rumored to be sloshing around, it’s not someone’s private property. No matter what “they” say.

  6. Should my heavily referenced post make it out of moderation, it may seem off topic, but it directly concerns the US debt and our “standing” with the “US Government”. I have, as best I could, provided references for the information contained within. It may not be quite up to the good Dr.’s standards, but we have limited space available for our posts.

    1. Phil the Thrill

      Speaking of our “standing,” among the more esoteric treatments of the subject I’ve encountered relates it somewhat to Buddhist philosophy. “Thou Art That”. We, as interdependent co-arisers with our universe, are sufficient to our own needs, and therein lies the basis for this interpretation of how to shed one’s “citizen” standing, and regain sover rain status. In this view, we have tricked ourselves into giving away our sover rainty. Rather interesting in that light, don’t you think, Mr. Dead?
      I’ll keep an eye out for your post.

  7. Robert Barricklow

    Yes, a full-spectrum toll system is planned.
    A rentier society in the extreme.
    Makes sense/cents in every way,
    and then some…

  8. The problem boils down to who really controls our economy and it’s never been us. As to the Constitution while I was in school nobody taught anything about it so I know nothing about it. A interesting situation were a prime base to your society is never brought up and now with brick and mortar stores being close left and right I may never get to read it for myself. Creative accounting and faux economy rules the roost and your idea of reality is as good as mine.

  9. The years 1789, 1859, 1929, and 1999 are historically relevant for one simple reason. International bankruptcies last 70 years. The first US bankruptcy occurred in 1789. That was the year we lost the judicial system in the US, there have NOT been any judges in America since 1789. There have just been administrators. (FRC v. GE 281 US 464 Keller v. PE 261 US 428, 1 Stat 138-178). The Republic lasted a grand total of 12 years.
    The first restructuring of the bankruptcy occurred in 1859, we get the civil war, not about slavery at all, the northern states wanted the wealth of the southern states as part of the bankruptcy settlement. The second resettlement occurred in 1929, we get the Great Depression. The third resettlement occurred in 1999, it took two years, and we get 9/11.
    A 1040 Form is for tribute paid to Britain (IRS Publication 6209). Social security is administered by the Queen, and she gets paid for doing so. Social Security is not insurance or a contract, nor is there a Trust Fund. (Helvering v. Davis 301 US 619 Steward Co. v. Davis 301 US 548).
    Every thing in the “United States” is up for sale: bridges, roads, water, schools, hospitals, prisons, airports, etc, etc… (Executive Order 12803). The U.N. also holds all of the land of America in Fee Simple. The U.N. has financed the operations of the United States government (the corporation of THE UNITED STATES OF AMERICA) for over 50 years (U.S. Department of Treasury is part of the U.N.) and now owns every man, woman and child in America. “We are human capital” (Executive Order 13037). “The People” does NOT include you and me. (Barron vs. Mayor and City Council of Baltimore 32 U.S. 243). We are bond servants and own absolutely nothing, NOT even what we think are our children. (Tillman vs. Roberts 108 So. 62, Van Koten vs. Van Koten 154 N.E. 146, Senate Document 438 73rd Congress 1st Session, Wynehammer v. People 13 N.Y. REP 378, 481).
    After over 200 years of bankruptcy it is finally over. (Executive Order 12803). The United States has NOT had a Treasury since 1921 (41 Stat. Ch 214 page 654). The IMF is an agency of the U.N. (Black’s Law Dictionary 6th Ed. page 816). The U.S. Treasury is now the IMF (Presidential Documents Volume 24-No. 4 page 113, 22 U.S.C. 285-2887). The IRS is Not a US government agency. It is an agency of the IMF (Diversified Metal Products v I.R.S et al. CV-93-405E-EJE U.S.D.C.D.I., Public Law 94-564, Senate report 94-1148 pg. 5967, Reorganization Plan No. 26, Public Law 102-391).
    At this point, the “owners” as George Carlin so aptly put it, can do as they please with the US and “We the People” cant do anything about it. You CANNOT use the U.S. Constitution to defend yourself because you are NOT a party to it! The U.S. Constitution applies to the CORPORATION OF THE UNITED STATES, a privately owned and operated corporation (headquartered out of Washington, DC) much like IBM (International Business Machines, Microsoft, et al) and NOT to the people of the sovereign Republic of the united States of America. (Padelford Fay & Co. v The Mayor and Alderman of the City of Savannah 14 Georgia 438, 520). America is a British Colony. The United States is a corporation, not a land mass and it existed before the Revolutionary War and the British Troops did not leave until 1796 (Republica v. Sweers 1 Dallas 43, Treaty of Commerce 8 Stat 116, Treaty of Peace 8 Stat 80, IRS Publication 6209, Articles of Association October 20, 1774). The “zip code” extends this corporate constitution throughout the entire US by creating “Federal Zones” within the States, and you thought it was for faster mail delivery.

    1. And I’ve heard that imf stands for “individualmasterfile” of which all collaterals have in order to be packaged for certified currency valuation for discharge in a debt-based fiction. Seems as though the redamendment should be in there somewhere. And what about voterregistration as stakeholder passion as willing and able support for debt purchases? Thank you for that mrdead…but please don’t stop before the gaap of burean’s calf’r is explained.

  10. Hello,
    I really appreciate your insights and conversations. I started listening to you on Catherine Austin Fitts, Solari Reports. It’s nice to hear a voice of reason and truth among so much disinformation out there. Thanks again for sharing your thoughts and for doing this research. I wouldn’t know where to start. Have a Brilliant Day!

  11. Goes to show that it can be done. But as long as the banks are making ‘imaginery’ money appear out of nothing.. why should they stop?

  12. My general Red Flag has to do with central banks. When have they EVER been concerned with the nation they are preying on? We just haven’t figured out (yet) how this particular twist benefits the Japanese (private) central bank.

    In that regard, I could see a ‘wager’ on the future by the Japanese central bank. Even if the debt taken-on by that cb is interest free, the full principal is expected to be repaid on some fixed schedule. If the economy soars, the cb has locked itself in to non-growth money. Not good. However, if the economy tanks – especially if the economy tanks badly – the cb has locked-in the principal. This is especially useful if the tanking is so bad that price-deflation occurs.

    This approach is what airlines have been using, called ‘fuel hedging’. It is essentially a bet into the future. An airline forecasts oil/fuel prices into the future, and makes a bet – oops, hedge – with another firm. They lose some money if they miss-bet, but avoid huge losses if some unexpected oil/fuel price-uptick occurs. Southwest Airlines hedged fuel big-time before the last large oil/fuel uptick occurred and achieved a yearly profit when the majors – who had not hedged – were ble eding money for years.

    So, IMHO, someone above Japan’s cb has scoped-out a medium-to-major tanking of the Japanese economy and is safeguarding his/her/its principal. (Or, in the conspi ratorial view, they have already planned the tanking and are going to make money off the wrec king. A relative profit, anyway. When you can hold your own while everything else decreases by half, you have doubled your stake. Think 1929+.)

    (Also, Japan’s government may not choose to bail-out its cb if a 2008-style crisis occurs. By buying the debt, it’s ‘market valuation’ will always be 100%. Even if other cb’s not ‘hedging’ are forced into taking a haircut on debts by desperate nations.)

    1. Your analysis raises a lot of points GH. “Western” style debt slavery came in with the Meiji reforms and so it is unlikely that it will disappear overnight. Though there could be some off-the-radar movements towards some change with respect to the Bank for International Settlements (BIS) Illuminati-style control grid in force since 1930 (when Japan was a founder member with Belgium, France, Italy, Germany, Great Britain and the US).

    2. the principle is the principal can never be paid while the good is bad and the bad is good, while the first is last and last is first, while a lie is truth and the truth is a lie, while a person is fiction and fictions are persons, while god is dead and the dead become gods, while pyramids are top-down and the bottoms up is an ice-cold bud at your local pub-lick venue!

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