Capital is a tangible asset and in the past countries based this on some form of precious metal such as gold and silver which in the modern era became a securitised currency by nations central banks, based on amount held in reserve.
Brief History of the Bank of England: In the UK in 1833 the BOE issued paper notes, called “legal tender”, which were a promise to the barer that the noted value could be exchanged into a value of silver back by gold .
In the Bank Charter Act of 1844 the UK BOE currency became back by gold entirely.
The gold standard was suspended on a number of occasions during wars however in 1931 Britain came of the gold standard for good
In 1967, Harold Wilson “pound in your pocket” speech. This was a devaluation in the pound sterling in order to readdress trade deficits.
Mots of this is related to war in the past and to a great extent to day, and for this you need to create debt in order to pay the troops, as the amount of reserves may not completely be enough for all the wages, machinery and weaponry.
This debt must be paid and is linked to the value of currency which is now set by national and international investors who speculated on the price. This speculation alters trading levels of a nation and therefore increases or decrease prices of goods and services, this is referred to as inflation and deflation.
If the currency becomes or is likely to decrease significantly you have a situation where people take they pound and exchange it for other currencies this is a called a “run on the currency”.
In order to address investors from moving their money into other sounder currencies, economic polices are put in place, including setting interest rates higher or lower, thus trying attracting investors to continue holding the currency or not.
De-Valuing the currency by using quantitative easing measures is another mechanism.
So now the value of money in many countries is not based on gold or silver, it is not base on anything apart from speculation, and termed “fiat” money.
An interesting development in the past few months in the UK is that the new plastic notes being issued do not in anyway say, "Promise to pay the barer", any more, though this long ago never meant its old assurance that the note was a representation of real assets.
Hence the name Pound Sterling, which meant a £1 Note was the equivalent of 1 Imperial Pound weight of Sterling Silver.
With regards to the UK, progressive governments reduced the control the Bank of England had on the nations wealth and took the power away from the BOE regarding the printing of money, and delegating it to the major banks. Allowing them to create it by printing money, and of which the majority is digital 0 and 1's. Now, The Bank of England, only has the power over the interest rate.
As the banks became deregulated by governments this allowed them to behave as casinos, placing large amounts of “capital” on bets on the stock market. Some of which was in fact the banks own real money, or the money held in accounts by its customers, though some was these ”debt derivative asset swaps” using ”mortgage backed securities”.
These were repackaged sometimes with actual tangible assets and then resold many times and at each trade its value increasing without reason as house prices went higher and people were given mortgages with no real prospect of being able to pay them off.
Then when the realisation of this “toxic debt” struck and that the stock market had also been inflated, “a bubble”, with this so called the ”toxic debt.” the banks, fund managers, governments and individual investors sold their shares in companies, especially those who had not enough “real assets”, gold and so forth to pay off the debt.
The people took their money out of the banks, “a run”, worried that the banks would soon have no money to pay off the debts they had.
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Hence another world wide economic collapse occurred, the stock markets around the world crashed, and a “bare market” ensued, not seen sine the 1920's.
Which was an exactly happened back then, a run on the banks after a stock market fall, apart from the added problem of bad mortgages sold and inflated beyond reason. This not only affected one country but had created a “domino affect” across the globe.
The bankers told governments that they had to be “bailed out” or there would be chaos, no money for people to buy anything, leading to revolution.
It was a “gun to the head” situation as has one central banker said to congress at the time.
So the governments used “real money”, taxes, to fund the bankers mistakes and their gangster like demands to quell the financial world that all the debt would be guaranteed.
This for the most part stopped the run on the banks and steadied the stock markets from total collapse, however created a new world economic order.
Governments allowed quantitative easing, QE, a term for the printing of money basically all digitally, de-valuating the pound which has the effect of decreasing the dollar value of the debt allowing pay the bad loans and gambling debts run up by the bankers easier.
This QE money also was given to various “big business” at “0% interest”, “cheep money”, in order to boost industries ability to expand and hire, hoping to stem the problems.
This had the outcome of decreasing the interest rates due to all the cheep money circulating in the financial world.
It was also given to the banks themselves so that they could loan it out to “small businesses” and individuals at high interest rates.
However it lead to a situation where the banks and the elite used a lot of this cheap money to own the majority of houses. It has allowed for a “buy to let” rich class and “renter” class within a population. The poor who struggled to survive before the problems are now starting to voice their concerns and Governments are becoming a bit worried.
Also the futures market in food commodities was started at roughly the same period which led to 40% increase in some food prices almost overnight creating turmoil that continues to this day in the poorer regions of the world.
Added to this the competition in the jobs market by workers from all around the world driving down the cost of labour. So in the UK we have become what used to be called, a third world nation, where wage do not meet the amount needed to survive which has far reaching detrimental implications to society.
As a result here in the UK and in other “Developed” nations the majority of middle to lower class now have to rely on free “Food Banks” to supplement their day to day lives, and these are not unemployed individuals, some are full time nurses and fire-fighters teachers and many others who shouldn't be so financially burdened with the wages in those sectors.
From this article by the independent, it refers to these new facts of life in the UK
However it concludes it is to do with the government cutting benefits however it really should describe the fact that no person who works should need state benefits at all to be able to live happily. This is a major problem where governments and the media always pin the blame to a secondary problem and not the actual acute cause.
The real problem is People are paid to little or you could see it as using the terrible expression the "cost of living", before i rant on about that terminology to describe the modern day existence of humans, i shall just say, it is to high. This is mainly due to the price of purchasing a home, or even renting one for that matter, as i do. Plus the cost of keeping warm is far too much in the UK. Many of these problems are now being faced by many other supposedly "developed nations".
So they “bailed out”, the banking sector, hundreds of billions, just in the UK alone, 40 billion to one bank, to pay off the debt created by banks, especially through gambling, and this was done using real money, earned by the people for their "hard work", which is itself the most real of "tangible assets".
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No we all do not live in a capitalistic system any more, we are all in a world which is now based on irrational intangible international debt.
Therefore it was obvious for the computer age that cryptocurrency would be created by and for the people as a digital financial revolution against this attempt by the elite to monetarily enslave all.
DeepOnion is at the pinnacle of this movement against the injustices of the past by these monetarily illiterate and illegitimate controllers of the wealth of good citizens.
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