39-BOER WARS

 

The story of the City in London is all about gold. Mayer was the founder of international banking because he was the first banker to use gold as it was meant to be used. According to him, gold was not meant to be spent, it was meant to be mined, purchased, and then stockpiled in a secure location for all time. The one who had most of the gold ever mined, could easily control any monetary system at hand. Mayer started the Bank of America in 1781 with around 500 metric tons of French gold. After his real estate scam in France starting in 1789, he managed to funnel another 5000 tons of French gold to the City. In 1810, his son was setting the daily price of gold worldwide from his offices in the City. Nathan had perhaps as much as 7000 metric tons of gold under his control, close to half the gold ever produced at that time. He held most of England’s debt, and was effectively in charge of the English monetary system.

In 1812, Nathan sent Napoleon to Russia in order to force the Tsar to let private interests mine for gold in the Urals, which was a determining moment in our history. Thanks to the French engineers from l’École des Mines de Paris, placer deposit gold mining techniques were refined, and the City focused its attention on gold production.

There was the California gold rush of 1848, and when hard rock mining was made possible in the 1880’s, gold production skyrocketed. Paper money went to the miner, and gold went to the one who printed the paper, the City. As gold was stockpiled by the City, the paper it backed, whether in America or England, became as good as gold. There have never been losers, for the miners get paid the world price set in the City, and Mayer’s dynasty stockpiles the gold and creates more credit.

The total production of gold to date is estimated at around 200000 metric tons. The gold used in jewellery, industry, and dentistry, combined with the token amounts of gold on display in the various Central Banks of Germany, Italy, France, USA, China, Russia etc., probably accounts for around 75000 metric tons. When all is said and done, most gold is held in the form of ETF’s, Exchange-Traded Funds, and though it is impossible to know, there’s at least 100000 metric tons of gold bullion unaccounted for and stockpiled somewhere.

The Boer Wars are forgotten wars, but if one analyzes and correlates the dates and circumstances surrounding the discovery of gold and diamonds in South Africa and the wars that were fought in that country, it becomes clear that they were all about controlling the production of those two precious commodities. In 1879, the British had managed to put an end to the Zulu military might, and in 1880, had declared the South African Republic to be an English possession. But in 1881, the Boers, mainly Dutch white settlers, badly defeated the British troops and forced them to go home. In 1899, this time, with the help of several Commonwealth countries, Britain came back to fight the Boers, and after heavy casualties on all sides, Commonwealth, African and Boer, the British finally prevailed in 1902. The British unilaterally changed the name of South African Republic to Union of South Africa in 1909, while declaring it to be a dominion of the British Empire. Since then, South Africa has produced a disproportionate percentage of the world’s gold, along with most of its diamonds, and continues to do s

37-JAPAN/CHINA 1853, INDIA 1858

The East India Company established company rule in India in 1757, and it lasted till 1858. In 1857, after a major rebellion in which over 100 000 Indians were killed, Lionel, Mayer’s grandson, decided to dissolve the East India Company and put an end to the Maharajahs’ power by establishing the British Raj or Crown rule which lasted till 1947.

In 1930, Mohandas Ghandi led a revolt that galvanized the country, but it was short-lived. Nevertheless, after many subsequent years of haggling in the halls of power, both in India and London, it was agreed, in 1947, that two republics should be created, that of Pakistan (mainly Muslim) and that of India (mainly Hindu). That agreement later caused more religious tensions and more bloodshed, but nonetheless, there was an Indian general election in 1951. The Indian National Congress won a landslide victory, at which time Jawaharlal Nehru became the first democratically elected Prime Minister of the country. Religious tension remained high, but politically, India and Pakistan were working democracies and would never look back.

China, on the other hand, was a much more complicated matter. It was the biggest, most populated country in the world, but it had no permanent borders, no army, no national identity, no national pride, no economy to speak of, and was ruled by warlords. So, in 1947, with India on the verge of becoming a democracy and Europe on the verge of signing the Treaty of Rome, it was time to transform China into the world’s second largest market economy.

It was Lionel who had started the process way back in 1853 when he decided to use Japan, a country that was totally isolated from the west, to do his bidding. That year, American Commodore Matthew Perry sailed into Edo (Tokyo) Bay with four battleships, two of which were powered by steam. The Japanese marveled at this awesome technology that was totally unknown to them. However, their admiration would have been tempered if they had known that this impromptu visit was meant to usher in the end of an era, the Tokugawa shogunate.

In 1854, the Convention of Kanagawa was signed forcing the Japanese to open their ports and trade with the U.S. In 1868, the City financed the Meiji restoration, a political movement that gave Japan a constitutional monarchy, which meant that the City now controlled its monetary system and could allow credit to flow in. The Meiji restoration ushered in modernization and westernization, and as expected, the Japanese played the game of fukoku kyokei, a game that turned their country into a rich and powerful military power. Japan’s power grew, and the proud Samurais, not satisfied with their colonial status, developed a warring culture that would spread beyond its borders.

However, Japan had no raw materials to speak of and was dependent on the US for oil, rubber, and iron. In other words, it was vulnerable, and could easily be controlled. Japan was encouraged to expand and become the most important military and economic power in Asia. It grabbed Manchuria, Taiwan, and parts of Northern China in 1894, defeated Russia in 1904, and took possession of Korea in 1910. By 1929, it was an empire, and its expansionism knew no bounds. When Emperor Hirohito defied America by refusing to retreat from China, the US turned a blind eye and didn’t retaliate. Instead, the US slowed down the flow of raw materials for the world to see, but not enough to stop Showa expansionism. Japan had a job to do, and that was to clean up the warlords in China.

WWII was the time chosen to destroy the Japanese empire that had by then finished its work in China. The City then proceeded to the next step, which was securing China’s borders. China had Russia and Mongolia to the north, the Himalayas to the west and the Pacific Ocean to the east, but the South China Sea border had several vulnerable openings. England had returned and occupied Hong Kong after the war, in 1949 Chiang Kai-shek was in charge of Taiwan, and in 1950, after a longer than expected war, North Korea became a buffer zone between China and Japan. After the Indochina war that led to the creation of a nationalist Vietnamese government in 1975, the southern Chinese border was sealed. However, for good measure, in the 1970’s, the City allowed both Pakistan and India to develop the nuclear bomb. China was now effectively contained, and the process of unification could continue.

As early as 1934, the City had found the man who would help get the job done. Mao Tse-tung had caught the City’s attention when he was elected Chairman of the Soviet Republic of China, which, at the time, consisted only of a small communist controlled mountainous area in Jangxi province. The City started financing Mao after his famous Long March in 1935 when he evaded the Nationalist troops at the head of some eight thousand men, becoming a Chinese hero in the process. With financial help, Mao Tse-tung went on to fight Chiang Kai-shek’s Nationalists and in 1949, the Nationalists were forced to retreat to Taiwan, and Mao became President of the People’s Republic of China. From 1949 to 1958, Mao organized the peasants into collectives. He followed that up with his disastrous Great Leap Forward in 1958, when at least twenty million Chinese peasants starved to death. It was only after the purges of the Cultural Revolution, when the Red Guards went through China with a fine-tooth comb waving the Little Red Book and forcing everybody to follow the party line that the country started responding to one authority: Mao’s Communist Party. Now that China was united, it was time to turn it into a market economy.

The City was so confident that China would turn out the way it did, that immediately after WWII, in 1945, it gave China a permanent seat in the UN Security Council along with France, Russia, U.S.A., and the UK. In 1964, it allowed it to join the nuclear club, and in 1980 it opened the first of several Special Economic Zones in Shanghai.

36-CIVIL WAR

Once the borders of America were permanently drawn, there was still a lot of work to be done. The southern agricultural economy was out of sync with the rest of the country, and while the City wanted it to join the vibrant market economy of the northern states, the south was talking secession. Geopolitically, there was no question of letting it secede, not to mention the fact that it had huge oil reserves. Industry needed oil and the City wasn’t about to let a few country gentlemen destroy its masterpiece, America. The south’s old structures had to be destroyed, but the problem was how to start the civil war. The south was not about to attack the north, for it didn’t have the means and didn’t have to. All it had to do was stay put and secede. So, if something was to be done, it was up to the North. As it so happened, slavery was a hot issue in the north, and the City backed the candidacy of Abraham Lincoln, a staunch advocate for National Union and racial equality. It was rather easy to get the northerners worked up over the issue of slavery, and they declared war the minute the south seceded from the Union. Slavery was the pretext but not the real issue, for history has shown that the north is every bit as racist as the south. That’s why when Abraham Lincoln declared war on the south in 1861, he clearly stated that it was to preserve the Union. That was the truth, and it was precisely what the City wanted.

At first, it seemed that Abraham Lincoln was doing the City’s bidding, and, presuming he was assassinated for political reasons, we could ask ourselves why the bankers wanted to get rid of him, if such was the case. Some say it was because, in 1862, in wanting to pay for the war, Lincoln had Congress pass the Legal Tender Act, thus giving Congress the right to print interest-free money. However, because the greenback had so little success, it was likely not the real reason. We don’t know whether the City printed counterfeit greenbacks in order to flood the market, or whether it directed its defunct First Bank of the United States not to accept them, but the end result was that the greenback was not well accepted and quickly depreciated. In 1863, Lincoln had had no choice but to reverse his position and sign the National Bank Act. Even though the greenbacks remained legal tender, the law re-established the status of the dollar, thus voiding the Legal Tender Act. So why, if such was the case, have Lincoln assassinated when the interest-free money problem no longer existed?

A plausible explanation for his assassination would be to say that Lincoln was just too nice a guy. We can be sure that the City had wanted to replace the archaic social structures of the Old south after the war, for that had been the whole purpose of the war. But because Lincoln wanted to let the southerners rebuild their lives as they saw fit, and since his only requirement was to have the southerners swear allegiance to the Union, he had to be stopped. The domino theory, where the establishment players do what they’re paid to do, played out, and someone, who wanted to do what was best for America, proceeded to do just that. After winning the 1864 election by a landslide, Lincoln was assassinated on April 14th, 1865. The carpetbaggers, most of them lawyers and businessmen loaded with cash, were immediately unleashed, taking the south by storm. They purchased the abandoned lands, opened businesses and banks, constructed railroads, and last but not least, started running the local governments. America was now officially the United States of America.

34-WAR OF 1812

The media did prove to be the powerful force that it was meant to be, but it wouldn’t have happened as quickly and worked as efficiently if the City had not consistently maintained its control of the American monetary system.

When Mayer’s son, Nathan, opened his bank in the City in 1810 and started setting the price of gold for the whole world, that’s when the seeds of globalization were sown. As of that moment, the American monetary system and that of England were controlled by one man, notwithstanding the fact that there was a lot of opposition to central banking in America.

In 1810, the year before the charter for the 1st Bank of the United States was to run out, hostility to private banking in the US was on the rise. Under the influence of hot-heads like Andrew Jackson, James Madison finally agreed not to renew the bank’s charter in 1811. Back in 1810, Nathan Rothschild had seen the problem coming and had issued an ultimatum: “Either the application for the renewal of the charter is granted, or the United States will find itself involved in a most disastrous war.” Madison and Jackson did not realize that the power of the ‘international moneylenders’ could extend that far, and they didn’t alter course. After declaring that he would teach the impudent Americans a lesson and bring them back to colonial status if they didn’t renew the bank charter, he proceeded to do just that.

Around 1812, the English Navy started harassing the American merchant marine by impressing 10 000 American sailors into her Majesty’s service. It was an intolerable situation, and President James Madison was forced to declare war on the English, a war he could ill afford, especially, since officially, Nathan’s bank, the 1st Bank of the United States, no longer existed. Nathan’s plan was to force the United States to fight a war and sink them deeply into debt. After the US declared war against England on June 18, 1812, the English military forces moved into Canada.

The English kept close to the waterways. They went up the St. Lawrence and the great lakes right up to Fort Erie and Detroit. They went up the Richelieu River to Lake Champlain, and blockaded all the ports they could along the Atlantic coast as well. All in all, it was a small war of attrition that cost the Americans dearly. When the English burned down Washington DC on August 24, 1814, it was a determining moment. The Treaty of Ghent was signed on December 24, 1814, and the US Senate ratified it on February 16, 1815. All territory went back to its original owners, and there wasn’t much mention of anything else of importance. The real results were unofficial and never linked with that treaty. The 20-year charter for the 2nd Bank of the United States was signed on April 10, 1816. And since the President’s residence in Washington DC had been burned down, it would now be known as the White House because of the white paint used to cover the traces of the recent fire. Lastly, the people of Upper and Lower Canada had a new sense of identity.

When the second charter for the 1st Bank of the United States came up for renewal in 1836, President Andrew Jackson vetoed it. If the City, contrary to 1812, didn’t insist on getting the charter renewed at this time, it was because of the possibility of making a silk purse out of a sow’s ear. After completing the Louisiana Purchase in 1803, the West had naturally opened up. Now, in 1836, thirty years later, the City bankers decided it was time to let America expand at breakneck speed, a period that would become known as the Wildcat Banking Years.

The modus operandi was simple. During the period of 1836 to 1863, ambitious men of all kinds would open banks, claim land, prospect for gold, drill for oil, and do all the hard work generally. The frenetic development that ensued was like riding a bronco, it was definitely wild, but it was OK because the rodeo was taking place in a controlled corral. In other words, the dollar used by the defunct but still operating 1st Bank of the United States and its affiliates on the east coast was tied to the English pound which was tied to gold, and all the funny money being printed in the emerging American States had to be more or less pegged to the dollar. The shinplasters, as the state currencies were called, were meant to fail just like the Continental currency had during the War of Independence. When the time came and everybody cried for more financial stability, the dollar would again be officially re-instated throughout the country.

In 1863, Congress passed the Banking Laws Act, and the dollar became the official currency in all the States. Key industries working in the US dollar financial zone had prospered, and their tentacles reached across the entire nation. The oil industry, the railroads, the steel industry and industrial America generally, were run by men like Westinghouse, Carnegie, Morgan, Rockefeller, while the Lehmans, the Kuhns, the Loebs, etc. ran the branches of the defunct 2nd Bank of the United States. The Federal Reserve Board would have to wait until 1913.

During the Wildcat banking years, from 1936 onwards, Lionel, Nathan’s son, who had become head of the family dynasty in the City, was satisfied to let the American West open up in a free-wheeling manner. He had three other worldly matters that more attention. The most pressing one was getting the last European power, Spain, to leave America in order to establish a permanent southern US border. The French administration along with its military had left America in 1763, that of England in 1783, and now it was Spain’s turn. Once that was accomplished, the Manifest Destiny concept would be realized. Lionel would then populate California with Americans, and he already had an idea on how to do it.

The other two matters were opening Japan and getting it to help unite China by invading it and getting rid of the Chinese warlords, and the other was to give France political stability by bulldozing its center of power, Paris, and transforming it into the City of Lights. The building of democracies in the ancient lands of Europe with old political regimes would not happen overnight, and it was best to get started as soon as possible. The Chinese and Indian democracies would be easy enough to establish, but Europe would take a very long time to unite. To be sure, globalization was very much on Nathan’s mind when he established the family dynasty in the City, in 1810, and took control of international finance, but it didn’t get going until Lionel took charge in 1836.