On October 20th the TUC will march for “a future that works” and against austerity. In a booklet1 the TUC analyses “what went wrong” and spells out what the future should look like. In general terms, the programme is no different from the 2011 march under the slogan “Jobs, Growth, Justice”.2 That is, the TUC effectively invites its supporters to the streets to demand a future of poverty for the sake of the British economy and state.3
The government is undertaking a massive impoverishment programme, part of which is to cut housing benefits. In a recent speech1, Cameron argued: “If you are a single parent living outside London, if you have four children and you're renting a house on housing benefit, then you can claim almost £25,000 a year. That is more than the average take home pay of a farm worker and a nursery nurse put together.” He added: “For literally millions, the passage to independence is several years living in their childhood bedroom as they save up to move out; while for many others, it's a trip to the council where they can get housing benefit at 18 or 19 – even if they're not actively seeking work.”2
In 2009 Satoshi Nakamoto invented a new electronic or virtual currency called Bitcoin, the design goal of which is to provide an equivalent of cash on the Internet.1 Rather than using banks or credit cards to buy stuff online, a Bitcoin user will install a piece of software, the Bitcoin client, on her computer and send Bitcoin directly to other users under a pseudonym.2 One simply enters into the software the pseudonym of t
Already during his lifetime public opinion in the West had been in agreement about the deceased Libyan dictator: “insane” was the most frequent description of him. However, putting aside fashion faux-pas and focussing instead on his political career, the former ruler shows up in a rather different light. So who was Muammar Gaddafi?
Credit replaces money – credit cannot be replaced by money
In almost all economically successful states the accumulated debt has reached a level where it is unthinkable for it to be repaid through taxes this would be, and has been for several decades now, impossible.
This situation has come about on the back of the financial industry’s certainty that debt and interest would be serviced on time; which is to say, through credit they themselves will have granted at a future date. This propitious circle must be continuous if the symbiosis of state and financial capital is to be carried out successfully. A bank that has invested in state securities, and which is now waiting for its money, should immediately reinvest in new state securities so that it can then be paid with this (here: its own) newly invested money. In this fashion banks are able to hold on to a permanent stock of, say, British state bonds despite the maturation of given bonds after a few years. If a bank wants to reduce its holdings of state securities, then it demands payment without granting any new credit to the state. For this to work, other banks must be willing to increase their engagement in these securities.
Who are the lenders and what makes state bonds so interesting for them?
The main lenders come from the financial industry. Banks, insurance companies and mutual funds buy the bonds of their own state or other states. The second major creditor group consists of other states or their central banks. The German state, Japan and China, for instance, have considerable holdings of U.S. Treasury bonds. Thirdly, states attempt to harness their own population to finance sovereign debt. With bonds tailored towards this clientle states encourage the people to grant the state credit for interest in return.