How To Engineer A Crisis For Fun And Profit: Lessons From The Federal Reserve

How To Engineer A Crisis For Fun And Profit: Lessons From The Federal Reserve

by James Corbett corbettreport.com March 15, 2014 In 2008, Obama's then-Chief of Staff and the current Mayor of Chicago, Rahm Emanuel, calmly told an audience of top corporate executives assembled for a Wall Street Journal "CEO Council" conference: "You never want a serious crisis to go to waste. And what I mean by that is it's an opportunity to do things you think you could not do before."

I don't know what's scarier: the Machiavellian political calculus behind such a statement or the fact that Emanuel is now being touted as a serious contender for 2016 when Hillary eventually (hopefully) drops out. Either way, it's difficult to get the average person to understand that this is the way that the rich and powerful see crisis: as an opportunity to push the boundaries of their agenda further than they ever could have without the crisis.

It worked on 9/11: the Patriot Act, the TSA, the DHS, the ratcheting up of the NSA's spying on Americans, invasion after invasion (and occupation after occupation) in one of the most geostrategic squares of the global chessboard. All of this was pushed, enabled or energized by the crisis mindset that a still shocked and traumatized public found itself in on 9/12.

More importantly, the powers-that-shouldn't-be have long understood that the crisis effect works whether the crisis is genuine and spontaneous, or a manufactured event that they themselves have staged, manipulated, or allowed to occur. No matter the origins of the crisis, they can use the panic that follows any spectacular event to implement their agenda. The Pearl Harbor attack that FDR allowed to happen as the pretext for American involvement in WWII is but one obvious example of this phenomenon.

Sadly, this is not an unusual idea in the annals of history, nor one confined to the self-appointed rulers of the United States. The Japanese used a false flag bombing that they themselves perpetrated as a pretext for their invasion and occupation of Manchuria in the 1930s. Israel staged a string of bombings on American and British targets in Egypt in 1954 in order to convince the Great Powers to prolong their military presence in the Suez Canal occupied zone. In the 18th century King Gustav III of Sweden dressed his own soldiers up as Russians and got them to attack Sweden's own border post in order to kick off a war with Russia. There are no shortage of such examples throughout history and across cultures.

But still, people fail to grasp the point. A public that has been deprived of critical thinking skills invariably asks the same thing when first introduced to the concept of false flag

terror: "Why would the government attack itself?" Similarly, when the idea is raised that financial crises and panics are staged by the bankers themselves, the uncomprehending ask "But why would they want to crash the economy that they themselves are dependent on?"

In both cases, the questions rely on false premises. In the former, it's the idea that "the government" is a single, monolithic being; that this being defines itself by nationality or geographic territory; that the people who work for the government are all like-minded in purpose and vision; that they see themselves as indistinguishable from anyone else living in the same geographic location. In the latter, it's the idea that the bankers' wealth is dependent on the health of the economy; that "wealth" is measured solely in tallies of dollars and cents; that a fortune that shrinks in absolute terms cannot at the very same time grow in relative terms. All of these premises are readily proven false.

Last week we saw how the Federal Reserve was created with the help of just such a staged and manipulated event: the Panic of 1907. It was J.P. Morgan and his bankster cronies, as you'll recall, that first spread the rumors about the Knickerbocker Trust Company; it was a Morgan controlled bank that stopped processing payments for them despite knowing that this would trigger a panic; it was Morgan who organized the coordinated response that "saved" the economy; it was Morgan's enemies who found themselves bankrupt after the crisis was over; and it was Morgan representatives and associates who went to Jekyll Island to hatch what became the Federal Reserve system. So perhaps it is fitting that the ideological descendants of Morgan, the bankster cronies of our own era, continue to use staged and manipulated panics to enrich themselves and expand and consolidate their own power. And, to make the historical continuity that much more complete, they do so through the apparatus of the Federal Reserve.

The shining example of this phenomenon in modern times was the 2007 popping of the housing bubble and subsequent 2008 Lehman Bros. collapse and market meltdown. Although it has largely faded into the background of the cable news networks and talking head fora-preoccupied as they are with the news of the day (the news of the hour? the news of the minute?) in the never-ending 24/7 newscyclewhat little we have been permitted to know about this event and its aftermath by our would-be financial overlords is enough to confirm that the crisis, staged or spontaneous as it may have been, was manipulated to maximum effect by the real power behind the Federal Reserve: the ruling banking dynasties.

Last month, the Federal Reserve finally released the minutes and records of 14 meetings that took place in 2008 during the crucial window where the crisis unfolded and the Federal Reserve began to do things that previously it didn't think it could do. These minutes provide an interesting insight into one aspect of the meltdown: how the Federal Open Market Committee interpreted the crisis and how they reacted to it.

The records show how Bernanke mused about how the Federal Reserve was picking winners and losers in the crisis by deciding who to bail out, but by no means and at no point does Bernanke or his FOMC colleagues come across as people who are in control of the situation or fully aware of the ramifications of what is taking place around them. In the crucial September 16 meeting the day after the Lehman Bros. collapse, committee member William Dudley offers the particularly un-enlightening observation that "Either the financial system is going to implode in a major way, which will lead to a significant further easing, or it is not." You don't say. In another passage, Bernanke pauses in the midst of the worldwide economic collapse to fret about how his actions will be editorialized by USA Today and

the Wall Street Journal.

Ultimately, the minutes can be safely released at this point because they reveal precisely what the banksters want them to reveal: a confused, bumbling, haphazard, ad hoc response to the crisis. After all, the crisis came out of the blue and no one could have seen it coming, much less profited from it, right?

Wrong As keen observers of the 2008 crisis know, the real bankster insiders were fully aware of what they were doing in blowing up the housing bubble, creating the subprime lending industry, and paying off the ratings agencies to AAA certify their toxic mortgage CDO garbage. We know, for example, that Goldman Sachs were betting against the very same subprime-backed derivatives they were selling to their own customers (or "muppets" as they refer to their own customers in internal emails). We know that the largest banks in the country used the panic and confusion of the housing market collapse to their advantage by instituting a system for automatically generating fraudulent foreclosure proceedings, often without any clear title on the property in question and sometimes on properties that weren't even mortgaged. And we also know how the market emergency allowed the Fed to suspend its own conflict of interest rules and permit 18 of the current and former directors of the Federal Reserve's bank branches to direct as much as $4 trillion in bailout money toward their own banks.

While Bernanke and his crew dithered, the banksters around him swooped in for the kill. And now, five years later, with not a single major executive having done time for their participation in this highway robbery of the American financial system and the Fed's bailout money, we know they got away with it.

Rahm would be proud.

To some extent, the public's own incredulity at the idea that the banksters actually profited from this crisis has been responsible for this failure to prosecute. But the truth is that in any major financial crisis, wealth is neither created or destroyed, only transferred. And here in the fifth year of this amazing "jobless recovery" where banks continue to make record profits even as once-proud industrial cities declare bankruptcy, it is not difficult to see where that money has been transferred to.

It is now a well-known fact that the Chinese ideogram for opportunity is composed of the characters for "danger" and "opportunity." Like many well-known facts, this one, too, is technically incorrect, but its popularity represents an underlying truth: crises really are opportunities for the would-be controllers of society.

But there's an interesting twist to this analysis: it relies on the public panicking and begging for the powers-that-shouldn't-be to solve the crisis. In the final equation, it's the public that's in control. All we have to do is to stop buying into the panic and hype surrounding these staged crises and stop going along with the emergency legislation that constantly turns out to benefit no one but the rich and powerful. Easier said than done, perhaps, but as we stand here in 2014, with the greatest levels of wealth disparity the world has ever seen and the entirety of the world economy threatening to be sucked into a black hole of phony debt during the next great staged crisis, it is more important than ever that we take this message to heart.

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