My assessment is that 90% of the value of the U.S. dollar comes from the U.S. military. After we had our satellite systems in place, Cheney said “deficits don’t matter.” The US debt and deficit financing is no longer a debt system. It is a global taxation system.
Could you expand on this thought just a little? This is one very sober line of reasoning.
Global treasuries and sovereign wealth funds, central banks and a variety of large institutions buy Treasury securities or hold dollars not because there is economic value behind them or because these financial assets are sound fiscally or in terms of credit. They buy them because if they don’t buy them, their current holdings will drop in value faster (that is given their current holdings, they are better off with a managed fall that a precipitous one) and because they are forced to — both in terms of trade agreements — and because they have a gun at their head. If they don’t buy, they and their population will be subject to a wide variety of demonstrations of physical and financial force that will result in loss of life.
Hence, demand for U.S. dollars and government and agency bonds continues even as value falls. The losses on these holdings represents a tax paid to the “Empire.” The fundamental system is as old as the hills. It is based on force. However, this tax is not paid through the income statements, it is paid through the balance sheet. Hence, national legislators do not have to pass bills to authorize their people paying the tax. There is no disclosure.
This global taxation system can be implemented and enforced through the back door without the average global citizen understanding what is happening. Rather, it is invisible to all but the most financially sophisticated people.
What the implementation of this system means is that the household drain I describe here and the community drain I describe here are happening globally. That is, the Slow Burn (described here ) is draining everyone globally, not just in the U.S.
A recent Gallup poll published in the Wall Street Journal on June 26, shows that the American institution most respected is the military — 45% of Americans surveyed had a great deal of confidence in the American military and 26% had quite a lot of confidence in them. This compares to 6% and 6% for Congress and 7% and 13% for big business. Also in line with understanding who and what puts bread on the table, the next most respected institution after the military is small business with scores of 28% and 32%.
Abraham Lincoln was right, “You can fool some of the people all of the time, and all of the people some of the time, but you can not fool all of the people all of the time.”