behind the scenes



Académie Française

Letter to Pascal Roussel by
Valéry Giscard d’Estaing,
former President of France

Académie Française

Pascal Roussel
about how
the crisis
was engineered
and why


Ladies and gentlemen,
Thank you for coming tonight. I will express my own personal opinions. Regretfully I am not fluent enough in German so I will deliver this speech in English. I would like to share with you as much as possible without exceeding 20 minutes. To meet this challenge I am sorry but I will have to stick to my notes.

I am sure that you have all attended countless conferences on the financial crisis. You have been told that the economy is following “natural” cycles of up and downs, like seasons or tides. That we are currently in a down wave. That we should wait for the recovery and ask governments to do something to speed up that recovery. You have probably heard various reasons to explain the crisis and many experts have already highlighted to you the challenges that we should expect in the coming months. As far as solutions are concerned, some have probably told you that Eurobonds could help, while others consider them as a very bad idea. Some would say that more austerity measures are required while others believe that the economy needs a stimulus package. And of course some would tell you that Greece should exit the Euro zone while others assert the contrary. And so on. And so on.

Yet most of those traditional experts agree on one point: the severity of the crisis was totally unpredictable.

In February 2008, the US Federal Reserve Chairman, Mr Ben Bernanke said "I expect there will be some failures of smaller banks. But among the largest banks, the capital ratios remain good and I don't anticipate any serious problems of that sort among the large, internationally active banks that make up a very substantial part of our banking system."

So you see, totally unpredictable. But is it really so ?

I don’t want to bother you with one more traditional boring speech. No, I would rather like to briefly show you that the crisis is the consequence of a long chain of decisions, taken by elite circles. Anyone who steps back and sums up those decisions would see that they could only lead to a major crisis. As you will realize, there is no need to be an expert to come to that conclusion and therefore one can safely assume that the elites behind those decisions knew very well what they were doing. In a sense for them the current crisis is necessary to promote major reforms and their specific agenda. And don’t worry, I am not going to talk about hidden conspiracy theories but about historical facts, for sure not published in main street media but still easy to verify.

I have no time to go into the details of the shock doctrine but it has been demonstrated often in recent history that when a population is put under severe shock, it is not capable to think clearly and it is ready to accept gladly things that they would otherwise refuse. As such, some elite circles believe that shock is the best way to implement major reforms.

David Rockefeller speaking at a UN Business Conference on Sept. 14, 1994 said “We are on the verge of a global transformation. All we need is the right major crisis and the nations will accept the New World Order."

It takes more than a couple of years to engineer a major crisis, to promote major reforms, on a world level. It requires the implementation of many gradual changes in several fields such as commerce, trade, finance. It implies also societal and cultural changes. At first, all those changes seem independent and unrelated but at one point they all converge to create a major chaos.

To understand the root cause of the crisis we would need to go back in history but since my time is limited, I will start with the first pivotal financial decision:

On August 15, 1971, the US president Nixon agreed to follow his economic advisers and especially Mr Peter Peterson and appeared on the TV. In a famous speech, he announced that he suspended the convertibility of the American dollar with gold in order to stabilize the dollar. Nixon said that in full cooperation with the International Monetary Fund, the US will press for the necessary reforms to set up an urgently needed new international monetary system.

Keep this in mind, the announced purpose was to set up a new monetary system together with the IMF. I will come back to that later in my speech.

Mr Peterson, please keep also this name in the back of your mind. In 1969, Mr Peter Peterson’s career was boosted by John D. Rockefeller so that he not only became the secretary of commerce of Nixon but he was for years Chairman of the Council on Foreign Relations, an old and very powerful American Think Tank. He is the founder of Blackstone group and is also the founder of the Peterson Foundation which is very influential amongst the financial circles.

For centuries, the money that has been used was either silver or gold coins or paper backed by silver or gold. After the Nixon decision, for the first time ever in the entire history, humanity used someone’s debt as a mean of exchange. I guess that you all know, that the money you are using is created out of thin air and is only backed by debts. In 1971, after removing the remaining remote connection to gold, the brakes were released and from that moment on, money could be created at full speed.

This decision often called the Nixon shock coincided with the oil crisis. 40 years later we know that this oil crisis was engineered. By early 1973 the dollar had lost 40% of its value against the German Deutschmark. The power of Wall Street and of the American Century was threatened as never before in the postwar period.

As had been the case with Britain’s Pound Sterling a century before, controlling the world reserve currency would give Wall Street and the large international banks of New York an incomparable advantage in dominating the world financial markets and economy.

In May 1973, a group of 84 of the world’s top financial and political insiders met at Saltsjöbaden in Sweden at one secret Bilderberg meeting. As you probably know, the Bilderberg group gathers once a year about 130 world top managers for private discussions. In fact the yearly meeting is taking place right now in the US. In 1973, present were David Rockefeller, various CEO of the major oil companies, Zbigniew Brzezinski, Kissinger and many other top executives. The oil crisis was planned together with what Kissinger later called ‘recycling the petrodollar flows’ into US banks in the City of London. Anyway the point is that after the oil crisis the dollar was firmly established as the world reserve currency since oil is quoted in dollar. And a world reserve currency managed by a single country (the US) was the best receipt to engineer a world crisis at a later stage.

As Nixon’s Secretary of the Treasury, Mr Connally once famously said to European finance ministers: “Dollar is our currency, but your problem”.

One last word about oil, in order to justify the high price, the oil companies promoted the never proven assumption that oil is a fossil fuel and supported the unscientific methodology of Hubbert's to claim that oil production will peak. The abiotic origin of oil exposed by Russian scientists (Krayushkin) was mocked. In fact, various foundations and club such as the Club of Rome supported a general Malthusian plan which aimed at promoting the idea that the resources on earth are limited, that humans are producing too much CO2 and polluting and therefore that the human population should, one way or another, be reduced.

Let me come back to finance, when money is created, it benefits the ones who have a direct access to that new money, that is the ones closer to the source of money. And this is to the detriment of the ones that are far from the source namely the average man or woman who will suffer from the general price inflation, which is a consequence of the money creation and the dilution of its exchange value. The source of money are commercial banks. So the ones who benefits from the new money are commercial banks or Hedge Funds with easy access to commercial bank loans. There are mainly 2 points of entry for newly created money:

- the stock exchange and commodity markets

- and real or commercial estate

The holder of the new money can use that money to blow various speculative bubbles on those 2 points of entry or they can attack weaker currencies. And indeed that’s exactly what happened, after 1971, there has been many crisis:

  • In 1973, the oil prices soared, causing the 1973–1974 stock market crash
  • Then in the United Kingdom we had the secondary banking crisis of 73–75
  • Then in 82, beginning in Mexico with the Mexican Weekend we had the Latin American debt crisis of the 80s
  • In Israel, we had the bank stock crisis of 83
  • Then in 87 we had the Black Monday, the largest one-day percentage decline in stock market history
  • Then from 89 to 91 we had the United States Savings & Loan crisis
  • In 1990 the Japanese asset price bubble collapsed
  • early 90s we had also the Swedish and Finnish banking crisis
  • In 92–93 we had the so called Black Wednesday period with speculative attacks on currencies in the European Exchange Rate Mechanism. A good deal for Mr Soros.
  • In 94–95 we had the economic crisis in Mexico with speculative attacks and default on Mexican debt
  • After that, in 97–98 we had the Asian Financial Crisis with devaluations and banking crisis across Asia
  • 98 is the Russian financial crisis
    2000–2001, the Turkish Crises
  • 2001, also the Argentine Crises
  • And of course, 2001 is the Bursting of dot-com bubble. The same year we had the 9-11 events. You know when Islamic fanatics who loved alcohol and prostitutes, crashed 2 airplanes in the towers and were identified thanks to the miraculous discovery of their passport by the US police in the millions of tons of rubble.
  • And here we are with the major Financial crisis starting in 2007

Through fractional reserve system, the banking sector and more generally the financial world can survive only if trust is at the center. The receipt is very easy: whatever destroys that trust will create chaos.

Today’s crisis is a direct consequence of Nixon’s decision. Yet that’s not the only decision that caused the current crisis and that will probably lead to a major chaos in the future.

Impossible for me to go into the details but let’s review some of those financial decisions:

- Soon after the Nixon shock, central bankers around the world realized that something had to be done to avoid a huge increase of gold price which would send an immediate red warning signal. So they decided to lease their gold to bullion banks who, in their turn, sold that same gold. Then the gold stored on unallocated accounts was sold again, backed by paper certificates or shares of Exchange Traded Funds. At the end much more paper gold was sold than what is physically available to back those papers. Of course the ones behind that scheme knew that the day of reckoning will come and that it will contribute to create an even greater chaos.

- Under Alan Greenspan reign’s many laws which forced a clear separation between loan and savings banks on one side and investment banks on the other side were abolished.

- Greenspan strongly encouraged the development and usage of complex structured financial instruments which were rated AAA by friendly rating agencies.

- After the bursting of the dot-com bubble, Greenspan maintained the rates too low for too long. Together with extensive securitization, this decision inflated a real estate bubble in the US and triggered the subprime crisis.

This allowed a contamination of the entire financial world since it appeared to be very difficult to estimate the quality of the loans that were backing those instruments. As we all know the banking sector was rescued by the States and now there is nobody to rescue the States.

- The massive usage of High Frequency Trading Program was authorized almost unregulated

- But critical deregulation occurred also on the commodity market, in two steps; Before mid-70s there was no single "world price" for grain, the benchmark for the price of all foods and food products. The first sets of decisions focused on eliminating grain reserves. This was accomplished in 96 on a Worldwide level ( except for China and India). The Trilateral Commission’s publications played a major role in that accomplishment. In case you don’t know, that highly influential Think Tank was established in 1973, by Rockfeller and 2 US central bankers, Volker and Greenspan. Then the second rounds of decisions were aimed at eliminating the agricultural commodity derivatives regulation. In 2000 a law was eventually voted. The two key architects of Clinton’s new law were, Mr Larry Summers, a former Goldman Sachs consultant and Clinton’s Treasury Secretary and his Assistant at Treasury, Mr Tim Geithner, Close to the banking world and currently Obama’s Treasury Secretary. Mr Summers also prevented efforts to regulate financial derivatives in commodities and financial products. The historic and unprecedented deregulation facilitated the development of derivatives which played a critical role in the 2007 financial collapse. Bare this in mind when you will see in the coming months that the price of food is rising constantly: food is now a financial instrument. On the future market you have real food and virtual food and no distinction can be made between the two. Investors can sell food that does not exist to other investors who are not interested to take delivery of that virtual food. The great advantage for investors is that there will always remain a guaranteed demand. Can you think of any better financial instrument?

All those decisions created a proper framework and greed and selfishness did the rest. The greed of many traders and senior managers lead to various fraud such as the libor fraud or the Robot signing fraud and so on. Goldman Sachs was accused to sell toxic instruments to its own customers and at the same time buy CDS to gain from their collapse. Many selfishly motivated financial actors put their personal interests above the collective interest and this created what is called the 'financialisation' of the world economy. Where the focus is on short term views (that is one month) to the detriment of long term views, where management is driven by “stock prize”, by “stock options”, by “bonuses” which leads to a lack of productive investments and competition amongst workers on a worldwide level,…etc

Years after years, the Bilderberg group organized private meetings with the top managers of various corporations to foster globalisation. But let’s face it, trade liberalisation between countries with hugely different living standards, logically leads to the relocation of manufacturing facilities and generates unemployment. Globalisation is only profitable for multinational companies and their senior managers. For most of the participant of those meetings, globalisation has only one cult: "money“

In an environment where prizes are going up, where salaries are not progressing at the same pace, where unemployment grows due to relocation in China and India, another logical consequence is that the only possibility left for a family to purchase a car, a house or even a TV in some case, is to borrow. And again we see that debts are everywhere. We pay with debts and many people are over indebted. And be aware that through interests, debts concentrate wealth into the hands of the largest lenders.

All of this has been performed under the umbrella of leading ideologies such as Fabianism or the ones from the Frankfurt School whose purpose is to advance socialism on a worldwide level via gradualist and reformist means, rather than revolution. Their ultimate goal being a one world government. Fabianism is connected to elite groups, to eugenics and to some much darker ideologies. Many of those ideologies are promoted by the Rockfeller foundation and other equivalent foundations with the help of large media groups.

Today we are in more advanced stage of the crisis. As we all know, thanks to the Goldman Sachs special transactions debt issued by Greece in dollars and yen was swapped for euros using an historical exchange rate, a mechanism that implied a reduction in debt. The swaps were highly structured and even if initially it appeared as debt reduction it wasn’t at all. Many countries used swaps and officially, only Greece, could not resist to the temptation to hide its debt level. We shall see. It’s not necessary to explain what you all know about Greece and the consequences if it leaves the euro zone. It will probably have a bad impact on the Target 2 accounts at ECB which are at historical level because the banking system is not working well. The European banks prefer to settle their transactions in central bank money instead of scriptural money. All the banks are so connected through their short term funding, through derivatives that any major shock could have unpredictable consequences.

Mario Draghi the current head of the ECB was Goldman Sachs European Vice President while the famous swaps were established with Greece. He is member of the Trilateral Commission and of the Bilderberg group. Loukas Papademos was Governor of the Greek central bank when the famous swaps were signed. In November 2011 he was appointed prime minister instead of Papandreou. He is also member of the Trilateral Commission. In that same year, Mario Monti was chosen as the new prime minister of Italy without election. He is member of the Trilateral Commission and of the Bilderberg group and was an adviser of Goldman Sachs in 2005. Goldman Sachs, you know, the same bank which played a key role in the European crisis...

If the crisis is not simply accidental what could be the objectives of the real decision makers? A major crisis like the one we will have to endure, as it’s far from being over, will lead to major reforms. Today I would like to focus just on one reform. The financial one.

How to find out what could be the ultimate financial reform ? In fact it’s very easy, one needs simply to read the publications of the real decision makers. Indeed they don’t hide their objectives.

Immediately after the Nixon shock, amongst the first publication of the Trilateral Commission, we find a key document: « Towards a Renovated World Monetary System ». To summarize it very much, the document describes precisely how to establish a one world currency called bancor and based upon the special drawing rights of the International Monetary Funds which will be transformed into a world central bank. At first that new currency would not replace the other currencies but would act as a new “independent” world reserve currency in place of the US dollar. Through substitution accounts, the old currencies could gradually be replaced, I should say recycled, into the new bancor.

Apart from the Trilateral Commission, there are now more and more support for that plan. Especially from the Peterson Institute that I mentioned in the beginning of my presentation. As Paul Volcker former chairman of the Fed and founder of the Trilateral Commission, said, a global economy requires a global currency. In October last year, even the Vatican called for the establishment of "a supranational authority" with worldwide scope and "universal jurisdiction" to guide economic policies and decisions. "In fact, one can see an emerging requirement for a body that will carry out the functions of a kind of 'central world bank' that regulates the flow and system of monetary exchanges similar to the national central banks," said the Vatican.

Of course I know that some of you are thinking this cannot be true, that it’s impossible. You were probably thinking that the Deutsche Mark could never be replaced by a European Currency?

Now how was the euro created? A special fund was established to manage a basket of European currencies called ECU. That special fund was directly managed by the Bank of International Settlement , the central bank of central bank in Basel. All the European central banks maintained the exchange rate of their currency against the ECU. That special fund was transformed into the ECB and the ECU was changed into euro on January 1, 1999

Please take your time to read that Trilateral document and you will clearly see that the birth of the euro followed the plan described in that document. In a sense, the euro showed how to make one currency from many national currencies. Of course we all know that the euro had a birth defect that a world reserve currency cannot have: European government are independent from tax and budget point of view but the investors assumed that a weak state would always be automatically supported by the others and therefore investors did not apply a real spread on the sovereign yield of a country based upon its deficit. This assumption cannot exist in the case of a world currency.

Of course nothing is written in advance and by creating awareness we can change the future. On those words, I would like to conclude my presentation. I hope that I could add insight and perspective to your understanding of the events and would like to thank you for your kind attention.