-Caveat Lector-
The reasons for the Great Crash go back to the swift technological evolution
occurring in the U.S.A. between 1900 and the 1914 beginning of World War I
and the U.S.A's entry into it in 1911. Most important amongst those
techno-economic evolution events are those relating to electrical power. Gold
is the most efficient conductor of electricity, silver is the next, and
copper is a close third. Of these three gold is the scarcest, silver the
next, then copper. Though relatively scarce, copper is the most plentiful of
the good electrical conductors. Copper is also nonsparking and therefore
makes a safe casing for gunpowder-packed bullets and big gun shells. As a
consequence of these conditions, in the one year, 1917, more copper was
mined, refined, and manufactured into wire, tubing, sheet, and other end
products than in the total cumulative production of all the years of all
human history before 1917.
With the war over all the copper that had been mined and put into generators
and conductors did not go back into the mines nor did it rot.
World War I was not an agrarian, but an inanimate-energy and power-driven,
industrial-production war-with the generating power coming from Niagara and
other waterfalls as well as from coal and petroleum. For the first time the
U.S.A. was generating power with oil-burning steam turbines.
When the war was over, all this power-production equipment was still in prime
operating condition. There was enormous potential productivity-a wealth of
wealth-producing capability that had never before existed, let alone as a
consequence of war. The production capacity that had been established was so
great as to have been able to produce, within a two-year span, all those
ships, trucks, and armaments. What was the U.S.A. economy going to do with
its new industrial gianthood? It was the vastness of this unexpected,
government-funded production wealth and its ownership by corporate
stockholders that generated many negative thoughts about the moral validity
of war profiteering.
There were many desirable and useful items that could be mass-produced and
successfully marketed. Young people wanted automobiles, but automobiles were
capital equipment. In 1920 capital equipment was sold only for cash. There
were enough affluent people in post-World-War-I U.S.A. to provide an easy
market for a limited production of automobiles. In 1920 there were no
bank-supported time payment sales in the retail trade. The banks would accept
chattel mortgages and time payments on large mobile capital goods, such as
trucking equipment, for large, rich corporations. Banks would not consider
risking their money on such perishable, run-away-with-able capital equipment
as the privately owned automobile.
Because the banks would not finance the buying of automobiles and so many
money-earning but capital-less young people wanted them, shyster loaners
appeared who were tough followers of their borrowers when they were in
arrears. Between the ever-increasing time-payment patronage and the affluent,
a market for automobiles was opening that could support mass production.
In 1922 there were about 125 independent automobile companies. They were
mostly headed by colorful automobile-designing and -racing individuals for
whom most of the companies were named. They survived by individually striving
each year to produce an entirely new and better automobile, most of which
were costly. Many accepted orders for more than they had the mechanical
capability to produce. Their hometown financiers would back these
auto-designing geniuses so that they could buy better production tooling and
build larger factories. Wall Street sold swiftly increasing numbers of shares
in auto companies. More and more of them went broke for lack of production,
distribution, and maintenance experience on the part of the auto-designer
managements.
In 1926 the Wall Street brokerage house of Dillon, Read and Co. made a
comprehensive cost study of the auto-production field. They found that
130,000 cars a year was, in 1926, the minimum that could be accounted as mass
production and sold at production prices. Any less production had to carry a
much higher price tag. To warrant the latter, the cars had to be
superlatively excellent. The English-built Rolls-Royce brought the highest
price on the American market. There was fierce competition among Packard,
Peerless, Cadillac, Pierce-Arrow, Locomobile, Lozier, Leland, and others for
the top American car. All of those premium cars' frames, bodies, engines, and
parts were manufactured within their own factories. There were several
in-between classes, such as that of the Buick. Most of the 100 or so cars in
this intermediate range were assembled from special engines, frames, and
other parts made by independent manufacturers.
The mortality in auto companies was great. Dillon, Read led Wall Street out
of its dilemma by buying several almost bankrupt companies, closely located
to one another, such as those of the Dodge family, whose joint pro-
duction capacity topped the 130,000 units per year mass-production figure.
They named their new venture the Chrysler Company. Dillon, Read fired the
auto company presidents, who were primarily interested in new-car- designing,
and replaced them with production engineers. Wall Street followed suit and
put in production engineers as presidents of all the auto companies-except
Ford, who owned his company outright and had no obligation to Wall Street and
its legion of stock buyers. Old Henry himself was already the conceiver,
initiator, and artist-master of mass production. Because the American public
was in love with the annual automobile shows, the Wall Street financiers who
had thrown out all the colorful auto-designer presidents started a new game
by setting up the Madison Avenue advertising industry, which hired artists
who knew how to use the new (1920) airbrush to make beautiful drawings of
only superficially-not mechanically-new dream cars. They made drawings of the
new models, which required only superficial mudguard and radiator changes
with no design changes in the hidden parts. Parts were purchased by the big
companies from smaller, highly competitive parts manufacturers operating in
the vicinity of Detroit.
This was the beginning of the doWnfall of the world-esteemed integrity of
Yankee ingenuity, which was frequently, forthrightly, and often naïvely
manifest in American business. Big business in the U.S.A. set out to make
money deceitfully-by fake "new models"-and engineering design advance was
replaced by "style" design change.
In the late twenties first Ford and then General Motors instituted their own
time-financing corporations. The bankers of America said, "Let them have it,
they'll be sorry-autos, phew! We don't want to go around trying to recover
these banged-up autos when the borrower is in default." The bankers said, "It
is very immoral to buy automobiles 'on time.' They are just a luxury."
What the bankers did like to support in the new mass productivity was
tractor-driven farm machinery. Farm machinery was easy to sell. As the farmer
sat atop the demonstration plowing or harvesting equipment, with its power to
go through the fields doing an amount of work in a day equal to what had
previously taken him weeks, he said to himself, "I can make more money and
also take it a little easier." So the bankers approved the financing of the
production and marketing of the farm machinery. They held a chattel mortgage
on the machinery and a mortgage on the farmland itself and all its buildings.
The bankers loved that. There was enthusiastic bank acceptance of the selling
of such equipment "on time" to the farmers. The bankers did not consider
this immoral." The farmer was "producing food wealth." The automobilist was
"just joy riding."
Then there came a very bad hog market in 1926. Many farmers were unable to
make the payments on their power-driven equipment. The local country banks
foreclosed on the delinquent farmers' mortgages and took away their farms and
machinery. The bankers had assumed that the farms were going to be readily
saleable. It turned out, however, that there were not so many nonfarmers
waiting to become farmers, and most of the real farmers had been put out of
business by the bank foreclosures so couldn't buy back their own farm. There
were no city people eager to go out and buy one of those farms. "How you
gonna keep them down on the farm, after they're seen Paree?" were the words
of a popular World War l song.
So the dust bowls developed as the upturned, unsown soil began to blow off
the farms. it is relevant to note that, in 1900, 90 percent of U.S.A.
citizens were living and working on the farms; in 1979 only 7 percent were on
the farms, mostly as local supervisors for big, absent-ownership
corporations. The owners of the farmlands today are no longer "farmers" or
even individual humans-they are the great business conglomerates. What began
in 1934 as government subsidies and loans to farmers for farm machinery,
later to keep acreage out of production, would by 1978 result in President
Carter making enormous payments to appease big corporations for cutting off
vital grain and other strategic shipments to Russia. Next, the US. government
would make enormous subsidies to bail out large corporations such as Lockheed
and Chrysler, which as basic military suppliers the U.S. government could not
allow to go bankrupt. Eventually the US. taxpayers will be asked to make
'free-of-risk" bail-outs of "private" enterprises, corporations with initial
physical assets worth over a billion dollars classifed as risk enterprises.
We now return to the 1926-'27--'28--'29 sequence of events developing from
selling the farmers' machinery on the bankers' drop-dead terms (mortgage
means "on death terms"). In 1927 and 1928 the bigger Western city banks began
to foreclose on their local country banks that had financed the farm
machinery sales and had been borrowing from the bigger city banks to cover
their unprecedentedly expanded loaning. First the little and then the
successively bigger banks found that they bad foreclosed on farmhouses that
had no indoor toilets, many with roofs falling in, barns in poor condition,
with the replevined farni machinery rusting out in the open-and no customers.
Word of the bad news gradually went around; small bank "runs" began and in
1929 came the Great Crash in the stock market. All business went from worse
to worser. Unemployment multiplied. Prices steadily dropped. Nobody bad money
with which to buy. Bigger and bigger banks bad to foreclose on smaller banks,
until finally in early 1933 there came one day in which 5000 banks closed
their doors to stop "the run" on their funds.
People were dismayed and both individually and collectively helpless to do
anything to combat the economic collapse. The economy had gone to pieces.
People did not parade and protest. They became so iow in spirit and listless
that they just sat around silently in their homes or in public places. The
New York subway stations were filled with people sleeping on the concrete
platforms and stairways. No religious organizations were willing to let
people sleep in their churches.
There came a "pecking-order" point when the central Chicago banks foreclosed
on all the other big Western city banks-followed by the big New York City
central banks foreclosing on Chicago's central banks Finally came the
denouement, when the big New York banks found themselves about to close
because they were already behind-the-scenes insolvent. This occasioned the
U.S. Congress voting to accelerate by four months the presidential
inauguration of Franklin Delano Roosevelt who, minutes after taking his oath
of office, signed the Bank Moratorium, which momentarily suspended the
acknowledgment of the death of the wealthy landowners banking system that had
lost all or much of its depositors' money. About a month later Congress voted
to the President of the U.S.A. the ability to control all money. Months later
again the U.S. Supreme Court upheld that legislation. The U.S.A. citizens
themselves and their government had become the wealth resource "of last
recourse." The underwriting wealth belongs to all the people and not to the
few. That happened also to be the description of socialism.
The 150-year-long "infinite wealth" poker hand and its uncalled bluffing was
over. The called hands were suddenly down. It turned out that the "wealthys"'
wealth was nonexistent. Their marble-walled, steel-barred, vis- ibly vaulted
banks had been psychologically attractive to the depositors, who preferred to
have their earnings and savings deposited along with the wealth of the
powerfully rich. What the banks had been was to loan the people's deposits to
other people. The banks had no money themselves. What they had done was to
capitalize their land at their self-asserted value and had been credited with
that value of stock in the bank's ownership.
In 1933, for the first time ever, the hands of the U.S. American wealthy were
exposed (and by inference, all land-based capitalism everywhere around the
world)-most were money empty. Their land and multiservanted mansion values
dropped to almost nothing. Nobody had the almost-nothing amount of money to
buy those richly housed estates. There was one exception to the last
statement-the Vatican-administered Roman Catholic Church's world
organization, which for a pittance acquired many extraordinary properties at
that time, which it converted into monasteries and convents, colleges and
schools.
The game of "deedable land wealth" had been a bluff from its very
beginning-niultimillennia ago, when that little man on a horse, armed with a
club, first rode up to the giant shepherd leader of a tribe and said,
bluffingly, "It's very dangerous out here in the wilderness for beautiful
sheep such as yours," and the shepherd leader's ultimate coercion into
accepting "protection" from the claiming and proclaiming "owner" of the land
Landownership did not go back to an act of God. All the kings always had
their priests present when the land claimage was made by their explorers. The
priests planted their crosses to confirm that the king's ownership was
blessed by God, The Roman Catholic Church, starting in its emperor-pope days,
has been in the deeded-land business for "going on" 2000 years. It is as yet
the world's largest real estate owner. Real, a Spanish word, means
"royal"-the succession of king-deeded estate lands,
With the bluff of wealth over in March 1933, almost all business in America
stopped. On the inauguration of Franklin Delano Roosevelt the emergency was
so absolute that Congress voted unanimously for whatever corrective measures
the New Deal administration prescribed.
Rooseve1t and his advisors said, "One thing is clear. Despite the emergency
America abhors socialism. Americans don't like the assumption that everybody
is equal. Americans are so independent, they don't feel at all equal. They
don't like socialism, but," said the New Deal leaders, "the fact is that we,
the American people, are going to have to guarantee our own bank accounts.
People don't like to keep their money under their mattresses and prefer to
put it into a bank, so we will have to do what we can to rehabilitate the
banks. We the people acting unanimously through our government are going to
have to guarantee the safety of each deposit in the banks to a convincingly
substantial amount-$5000. We will leave the bank in ownership of the
management of the stockholders of those banks that, by virtue of the
presidential moratorium, are as yet theoretically alive, and hope that, with
our guaranteeing, regulation, and supervising, many of them will reopen and
will be able to progressively accredit their depositors with some percentage
of their original deposits.
"But let us not deceive ourselves. With the government of the people
guaranteeing the bank accounts, it becomes, in operating fact, socialism. On
the other hand people themselves know so little about banking, credit
concepts, and the history of power structures that they will not know that
they have adopted socialism, since the government has not taken 'possession'
of the banks. Society will think well of 'we the people' as the government,
guaranteeing the new deposits in the banks up to $5000."
Society likes the idea of a bank as a safekeeping device. People have always
believed that when they put their money in the bank, it stayed there. They
had no idea it went out on loan within minutes after it came in. They were
completely hoodwinked by the appearance of the banks as safe, fire-proof, and
robberproof depositories of their earnings. Even today, in the last twenty
years of the twentieth century, people know little more about banks than they
did during the 1929 Crash or at the depth of the Depression in 1932, when all
they knew was that they had lost their deposits in most of them.
In 1933, '34, '35, and '36 the New Deal and the U.S. Congress diligently
investigated the banking system and the practices of its most powerful
leaders. They found many malpractices, which we will discuss later. Most
prominently they found the banks loaded with worthless mortgages on
properties that were unsaleable because uninhabitable-mortgages on buildings
without roofs, bathrooms, etc.
The government said, "The first thing we must do is make those mortgages
we've inherited worth something." At this point the American government
dictated the banking strategy and started refinancing of the building
industry. The so-called building "industry" was already 2000 years behind the
arts of building ships of the sea and sky, which ships of the sea and sky
are, in fact, environment-controlling structures in exactly the same sense
that land buildings are environment-controlling structures.
While the design of the seagoing and airgoing environment controls are
generate their own power, desalinate their own water, etc., there is no
weight consideration in the designing of the land-anchored environment
controls. They don't have to float or fly. They are utterly dependent on
sewers, waterlines, electric lines, highway maintenance. They are utterly
controlled by the prime landowners, their building codes and readily
imposable legal restrictions-all based on the real estates' ownership and
control of the highways-sewers-waterlines-the metabolic "guts" of all U.S.A.
towns and cities.
When the government owns the wealth and controls the issuance of its money,
it is socialism. The New Deal was not trying to deceive the people but was
engaged in a rescue operation of the first order and was hopeful of not
irritating the people psychologically by what it seemed was critically
mandatory to accomplish.
Paradoxically, the first people they irritated-greatly-were yesterday's rich,
in particular those who were as yet living on the dividends and interest of
as yet solvent industrial corporations' stocks and bonds. In fear of the New
Deal they sought to discredit Roosevelt by a word-of-mouth campaign. From
1933 to 1940 individual members of rich gentlemen's clubs of New York were
ostracized from membership in the rudest manner by "the members" if they were
not heard to speak frequently of "that son-of-a-bitch in the White House."
Franklin Roosevelt and his advisors said, in effect, "We've got to do what we
feel is best for the people by whatever name the 'best' may bear. We've got
them depositing again in the banks and are rehabilitating all those mortgaged
properties which we have inherited by loaning the new owners of the
properties funds at negative interest provided they will rehabilitate the
property-reroof or put in a bathroom, etc."
To those who understood some of its intricacies, everything was now out in
the open about the world of banking. The New Deal said it was going to
prohibit usurious rates of interest-"the banks must earn enough to keep
themselves going, but only can charge l'/~ percent for interest." Banks were
regulated just like the Post Office. No banker had authority beyond that of a
postmastezt The New Deal completely separated from banking what Morgan and
many of the private banks had been doing-taking deposit money and putting it
into common stocks and even into the bankers' own highly speculative private
ventures. Thus came the New Deal's Securities and Exchange Commission and the
complete separation of banking and initial risk financing-or, at least,
supposedly so. Banks' trust departments could as yet buy and sell corporate
venture stocks for clients' accounts however.
There were a number of individual bankers who went far beyond unwise banking
practices and who, as individuals, took personal advantage of the information
they had of individual depositors' affairs and of their privilege as top bank
officers to do truly inimical things to enrich their own positions. Few today
remember that a half-century ago a number of New York and Chicago's top
bankers were sentenced into penitentiaries-the New Yorkers into Sing Sing-the
senior partner of J. P. Morgan and Company, the president of the National
City Bank, the president of Chase Bank. Every one of them had been found to
be doing reprehensible financial tricks. They were selling their own friends
short. They were opening their friends' mail and manipulating the stock
market. They were manipulating everybody. They were way overstepping the
moral limits of the privileges ethically existent for officers in the banking
game, so a great housecleaning was done by the New Deal. The banking story is
best told by a poem that was, at that time, allegedly composed by Ogden Nash
but was never to my knowledge formally published and copyrighted. It was,
however, memorized and widely recited from copies often typewritten by those
who remembered it:
"BUTCHER, BAKER, CANDLESTICK MAKER"
I'm an autocratic figure in these democratic states,
A dandy demonstration of hereditary traits.
As the children of the baker bake the most delicious breads.
As the sons of Casanova fill the most exclusive beds
As the Barrymores and Roosevelts and others I could name
Inherited the talents that perpetuate their fame,
My position in the structure of society I owe
To the qualities my parents bequeathed me long ago.
My father was a gentleman and musical to boot.
He used to play piano in a house of ill repute.
The Madam was a lady and a credit to her cult,
She enjoyed my father's playing and I was the result.
So my Daddy and my Mummy are the ones I have to thank
That I'm Chairman of the Board of the National Silly Bank
CHORUS: Oh, our parents forgot to get married
Our parents forgot to get wed
Did a wedding bell chime, it was always a time
When our parents were somewhere in bed.
Then all thanks to our kind loving parents.
We are kings in the land of the free.
Your banker, your broker, your Washington joker,
Three prominent bastards are we, tra la,
Three prominent bastards are we!
In a cozy little farmhouse in a cozy little dell
A dear old-fashioned farmer and his daughter used to dwell.
She was pretty, she was charming, she was tender, she was mild,
And her sympathy was such that she was frequently with child.
The year her hospitality attained a record high
She became a happy mother of an infant which was I.
Whenever she was gloomy, I could always make her grin,
By childishly inquiring who my daddy could have been.
The hired man was favored by the girls in Mummy's set,
And a traveling man from Scranton was an even money bet.
But such were Mother's motives and such was her allure,
That even Roger Babson wasn't absolutely sure.
Welt I took my mother's morals and I took my daddy's crust,
And I grew to be the founder of the New York Blankers Trust
CHORUS: Oh, our parents forgot, etc
In a torrid penal chain gang on a dusty southern road
My late lamented daddy had his permanent abode.
Now some were there for stealing, but my daddy's only fault
Was an overwhelming tendency for criminal assault
His philosophy was simple and quite free fmm moral taint;
Seduction is for sissies, but a he-man wants his rape,
Daddy 's total list of victims was embarrassingly rich
And one of them was Mother, but he couldn't tell me which
Well, I didn't go to college but I got me a degree
I reckon fin the model of a perfect SOB.,
I'm a debit to my country but a credit to my Dad
The most expensive senator the country ever had.
I remember Daddy's warning-that raping is a crime,
Unless you rape the voters, a million at a time.
CHORUS: Oh, our parents forgot, etc.
I'm an ordinary figure in these democratic states
A pathetic demonstration of hereditary traits
As the children of the cop possess the flattest kind of feet,
As the daughter of the floozie has a waggle to her seat,
My position at the bottom of society owe
To the qualities my parents bequeathed me long ago.
My father was a married man and, what is even more,
He was married to my mother-a fact which I deplore.
I was born in holy wedlock, consequently by and by
I was rooked by every bastard who had plunder in his eye
I invested, I deposited, I voted every fall,
And I saved up every penny and the bastards took it all.
At last I've learned my lesson, and I'm on the proper track,
I'm a self-appointed bastard and I'M GOING TO GET IT BACK.
CHORUS: Oh, our parents forgot to get married
Our parents forgot to get wed
Did a wedding bell chime, it was always a time
Then our parents were somewhere in bed
Then all thanks to our kind loving parents.
We are kings in the land of the free.
Your banker, your broker, your Washington joker,
Three prominent bastards are we. tra la,
Three prominent bastards are we!
* * *
DECLARATION & DISCLAIMER
==========
CTRL is a discussion and informational exchange list. Proselyzting propagandic
screeds are not allowed. Substance—not soapboxing! These are sordid matters
and 'conspiracy theory', with its many half-truths, misdirections and outright
frauds is used politically by different groups with major and minor effects
spread throughout the spectrum of time and thought. That being said, CTRL
gives no endorsement to the validity of posts, and always suggests to readers;
be wary of what you read. CTRL gives no credeence to Holocaust denial and
nazi's need not apply.
Let us please be civil and as always, Caveat Lector.
========================================================================
Archives Available at:
http://home.ease.lsoft.com/archives/CTRL.html
http:[EMAIL PROTECTED]/
========================================================================
To subscribe to Conspiracy Theory Research List[CTRL] send email:
SUBSCRIBE CTRL [to:] [EMAIL PROTECTED]
To UNsubscribe to Conspiracy Theory Research List[CTRL] send email:
SIGNOFF CTRL [to:] [EMAIL PROTECTED]
Om
