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Free issue of MICHAEL
ously, causing a decrease in prices. He could then
manipulate the wealth of others as he wished,
exploiting the buyer in times of inflation, and ex-
ploiting the seller in times of recession.
The banker, the universal master
The banker thus became the universal master,
keeping the world at his mercy. Periods of prosper-
ity and of depression followed one another. Human-
ity bowed down before what it thought were natural
and inevitable cycles.
Meanwhile, scholars and technicians tried des-
perately to triumph over the forces of nature, and
to develop the means of production. The printing
press was invented, education became widespread,
cities and better housing developed. The sources
of food, clothing, and comforts increased and were
improved. Man overcame the forces of nature, and
harnessed steam and electricity. Transformation and
developments occurred everywhere — except in
the monetary system.
And the banker surrounded himself with mys-
tery, keeping alive the confidence that the captive
world had in him, even being so audacious as to
advertize in the media, which he controlled; that the
bankers had taken the world out of barbarism, that
they had opened and civilized the continents. The
scholars and wage-earners were considered but
secondary in the march of progress. For the masses,
there was misery and contempt; for the exploiting
financiers, wealth and honours !
Louis Even
Update:
The ratio of cash versus loans in Canadian
banks was about one for ten in the 1940s. This ratio
(a 10% cash reserve requirement) has changed since
then. In 1967, the Canadian Bank Act allowed the char-
tered banks to create sixteen times the sum of their
cash reserves. Beginning in 1980, the minimum reserve
required in cash (bank notes and coins) was 5 per cent,
which meant that the banker needed only one dollar
out of twenty to answer the needs of those who wanted
pocket money. The banker knew very well that if he had
$10,000 in cash, he could lend twenty times the sum, or
$200,000.
In practice, the banks could lend out even more
than that, since they could increase their cash reserves
at will by simply purchasing bank notes from the central
bank (the Bank of Canada) with the bookkeeping money
they create out of thin air, with a pen. For example, it
was established in 1982, before a parliamentary com-
mittee on bank profits, that in 1981, the Canadian char-
tered banks, as a whole, made loans 32 times in excess
of their combined capital. A few banks even lent sums
equal to 40 times their capital. Moreover, in 1990 in the
U.S.A., the total deposits of commercial banks amount-
ed to about $3,000 billion, and their reserves amounted
to approximately $60 billion. A ratio of deposits to bank
reserves of about 50/1. U.S. banks held enough cash to
pay off depositors at the rate of only about two cents on
the dollar.
Subsection 457(1) of the most recent version
of the
Canadian Bank Act, enacted on December 13,
1991, states that, as of January, 1994, the primary re-
serve, in the form of cash, that a chartered bank has
to maintain is nil, zero. So the banks are no longer
limited by law in creating credit, or money. (And, if all
cash is eventually replaced by electronic money, with
debit or microchip cards, as is already planned by the
banks, they won’t even be limited in practice to creat-
ing money, which will then not be a piece of paper or
an entry in a ledger, but simply bytes, units of informa-
tion in a computer.)
Private banks lend symbols based
on the real wealth of nations...
... and they chain up the whole
world with unpayable debts !