In the same day the LORD made a covenant with Abram,
saying, Unto thy seed have I given this land, from the river of Egypt unto the great
river, the river Euphrates: The Kenites, and the Kenizzites, and the Kadmonites, And the
Hittites, and the Perizzites, and the Rephaims, And the Amorites, and the Canaanites, and
the Girgashites, and the Jebusites. - Genesis 15:18-21
[See beginning of 70 Weeks of Daniel for explanation of signs employed to
help better understand these definitions.]
Strong's Exhaustive Concordance of the Bible
Qeyniy or Qiyniy (1 Chron 2:55); patronymic [of the father's name] from 7014; a Kenite
or member of the tribe of Kajin:--Kenite.
[And the families of the scribes which dwelt at Jabez; the
Tirathites, the Shimeathites, and Suchathites. These are the Kenites that
came of Hemath, the father of the house of Rechab.--1 Chronicles 2:55]
7014 Qayin; the same as 7013 (with a play upon the
affinity to 7069); Kajin, the name of the first child, also of a place in
Palestine, and of an Oriental tribe:--Cain, Kenite (-s).
7013 qayin; from 6969 in the original sense of fixity;
a lance (as striking fast):--spear.
6969 quwn; a primitive root; to strike a musical
note, i.e. chant or wail (at a funeral):--lament, mourning woman.
Qenizziy; patronymically from 7073, a Kenizzite or descendant of Kenaz:--Kenezite,
7073 Qenaz; probably from an unused root meaning to hunt;
hunter; Kenaz , the name of an Edomite and of two Israelites:--Kenaz.
Qadmoniy; the same as 6931; ancient, i.e. aboriginal; Kadmonite
(collectively), the name of a tribe in Palestine:--Kadmonites.
6931 qadmowniy; or qadmoniy; from 6930; (of time) anterior
or (of place) oriental:--ancient, they that went before, east, (thing of) old.
6930 qadmown; from 6923; eastern:--east.
6923 qadam; a primitive root; to project (one
self), i.e. precede; hence to anticipate, hasten, meet (usually for
help):--come (go, [flee]) before, + disappoint, meet, prevent.
Chittiy; patronymically from 2845; a Chittite, or descendant of Cheth:--Hittite,
2845 Cheth; from 2865; terror; Cheth, an aboriginal
2865 chathath; a primitive root; properly to prostrate;
hence to break down, either (literally) by violence, or (figuratively) by confusion
and fear:--abolish, affright, be (make) afraid, amaze, beat down, discourage, (cause to)
dismay, go down, scare, terrify.
Perizziy; for 6521; inhabitant of the open country; a Perizzite, one of the
6521 peraziy; or perowziy; from 6519; a rustic:--village.
6519 perazah; from the same as 6518; an open
country:--(unwalled) town (without walls), unwalled village.
6518 paraz; from an unused root meaning to separate,
i.e. decide; a chieftain:--village.
rapha'; or raphah; from 7495 in the sense of invigorating; a giant:--giant,
Rapha, Rephaim (-s). See also 1051.
7495 rapha'; or raphah; a primitive root; properly to mend
(by stitching), i.e. (figuratively) to cure:--cure, (cause to) heal, physician,
repair, x thoroughly, make whole. See 7503.
7503 raphah; a primitive root; to slacken (in many
applications, literally or figuratively):--abate, cease, consume, draw [toward evening],
fail, (be) faint, be (wax) feeble, forsake, idle, leave, let alone (go, down), (be) slack,
stay, be still, be slothful, (be) weak (-en). See 7495.
1051 Beyth Rapha'; from 1004 and 7497; house of
(the) giant; Beth-Rapha, an Israelite:--Beth-rapha.
'Emoriy; probably a patronymic from an unused name derived from 559 in the sense of publicity,
i.e. prominence: thus a mountaineer; an Emorite, one of the Canaanitish
559 'amar; a primitive root; to say (used with
great latitude):--answer, appoint, avouch, bid, boast self, call, certify, challenge,
charge, + (at the, give) command (-ment), commune, consider, declare, demand, x desire,
determine, x expressly, x indeed, x intend, name, x plainly, promise, publish, report,
require, say, speak (against, of), x still x suppose, talk, tell, term, x that is, x
think, use [speech], utter, x verily, x yet.
Kena'aniy; patrial from 3667; a Kenaanite or inhabitant of Kenaan; by implication a
pedlar (the Canaanites standing for their neighbors the Ishmaelites, who conducted
mercantile caravans):--Canaanite, merchant, trafficker.
3667 Kena'an; from 3665; humiliated; Kenaan, a son
of Ham; also the country inhabited by him:--Canaan, merchant, traffick.
3665 kana'; a primitive root; properly to bend the
knee; hence to humiliate, vanquish:--bring down (low), into subjection, under,
humble (self), subdue.
Girgashiy; patrial from an unused name [of uncertain derivation]; a Girgashite, one
of the native tribes of Canaan:--Girgashite, Girgasite.
Yebuwciy; patrial from 2982; a Jebusite or inhabitant of Jebus:--Jebusite (-s).
2982 Yebuwc; from 947; trodden, i.e.
threshing-place; Jebus, the aboriginal name of Jerusalem:--Jebus.
947 buwc; a primitive root; to trample (literally
or figuratively):--loath, tread (down, under [foot]), be polluted.
"The Club [of Rome] had its beginnings in April of
1968, when leaders from ten different countries gathered in Rome...The organization claims
to have the solutions for world peace and prosperity...The Club of Rome has been charged
with the task of overseeing the regionalizaton and unification of the entire world...
"The Club's findings and recommendations are
published from time to time in special, highly confidential reports, which are sent to the
power-elite to be implemented. On 17 September 1973 the Club released one such report,
entitled Regionalized and Adaptive Model of the Global World System... The document
reveals that the Club has divided the world into ten political/ economic regions, which it
refers to as 'kingdoms.'"
(En Route to Global Occupation, Gary Kah)
North America (NAFTA)
Australia, South Africa
Eastern Europe, including Russia
North Africa and Middle East
South and Southeast Asia
(Mankind At the Turning Point, Eduard Pestel)
And I stood upon the sand of the
sea, and saw a beast rise up out of the sea, having seven heads and ten horns, and upon
his horns ten crowns, and upon his heads the name of blasphemy. And the beast which I saw
was like unto a leopard, and his feet were as the feet of a bear, and his mouth as the
mouth of a lion: and the dragon gave him his power, and his seat, and great authority. And
I saw one of his heads as it were wounded to death; and his deadly wound was healed: and
all the world wondered after the beast.--Revelation 13:1-3
One [way to consolidate international economy policies]
would be to bring within the purview of the IMF [International Monetary Fund] membership
as a whole issues of interest that are currently discussed within narrower forums, such as
the Group of Five (France, Germany, Japan, the United Kingdom, and the United States,
which began meeting in 1973 to discuss issues of common interest), the Group of Seven
(composed of the Group of Five plus Canada and Italy), and the Group of Ten (consisting of
the Group of Seven plus Belgium, the Netherlands, and Sweden). The procedures need not
preclude these forums, but linking them to the IMF would strengthen the legitimacy of the
surveillance process and of the institution itself. Another important advantage is that
procedures involving the full membership strengthen the rule of law and promote observance
of the code of conduct. This is because surveillance exercised within limited groups of
large countries represents only an extension of the principle of hegemony of a single
country passed on to the group. Broadening participation to the whole membership places
the rule of law in the role of the hegemon, thus strengthening the legitimacy and the
stability of the established order.
(IMF Pamphlet Series - No. 46 The Unique Nature of the
Group of Five - Similar to the Group of Seven
(G-7), with the exception of Canada and Italy.
Group of Seven - This term refers to seven major
economic powers (Canada. France, Germany, Great Britain, Italy, Japan, and the United
States) whose finance ministers seek to promote balanced economic growth and stability
among exchange rates.
Group of Seventy-Seven - A grouping of developing
countries which received its name in connection with 77 countries issuing a joint
statement in Geneva, Switzerland in 1964. The G-77's primary focus is serving as a caucus
for articulating members' collective interests primarily in areas of promoting economic
cooperation among developing countries and in negotiations on economic matters with
developing countries. G-77 membership has increased since 1964 to over 125 countries.
Group of Ten - Under the International Monetary
Fund's General Agreements to Borrow (GAB), established in 1962, 10 of the wealthiest
industrial members of the IMF "stand ready to lend their currencies to the IMF up to
specified amounts when supplementary resources are needed." The finance ministers of
these countries comprise the Group of 10 (also called the Paris Club). Members include:
Belgium, Canada, France, Germany, Italy, Japan, Netherlands, Sweden, Switzerland, the
United Kingdom, and the United States. Though numbering 11 with the addition of
Switzerland in 1984, the numerical name persists.
Group of Twenty-four - A grouping of finance
ministers from 24 developing country members of the International Monetary Fund. The
Group, representing eight countries from each of the African, Asian, and Latin American
country groupings in the Group of 77, was formed in January 1972 to counterbalance the
influence of the Group of 10.
The rusty colored building which houses the Bank for
International Settlements-BIS in Basle, Switzerland looks like any other round office
building. A small sign affixed to the wall by the steps leading to its front glass doors
tells you it is private property. Other than that you would never think twice about this
building as there is nothing specific which marks it as being the most important bank and
building in the world.
When the BIS holds its two-hour annual meeting,
those who control the world's monetary system, the central bank ministers-- unlike the
presidents and prime ministers who attend United Nations conferences--do not have
motorcades or limousines which they ride in, but walk to the BIS from the local hotels
where they stay.
In the book, Confidence Game by Steve
Solomon (Simon & Schuster, NY: 1995), he provides a favorable history of the world's
central banks and justifies over and over again the need for their existence. The culprit
responsible for the current problems with currency imbalances is globalization
which Solomon describes as:
The uncontrolled, high-speed gyrations of stateless
money unhinged from economic fundamentals or national economic policies [which] has
transformed the international monetary system from a smooth....mechanism that anchors a
harmonious world political and economic order into a fully floating, private non system
driven by the roller-coaster shifts in focus....of the....global financial investors. All
models of democratic capitalism....are in distress because of the new phenomenon of uncontrolled
stateless money. No country can solve the challenge singly. Nor can any country cut
itself off to escape its effects. The fates of all democratic capitalist nations are
dependent upon how well we can collectively civilize stateless money within a new
international compact of world monetary rules, norms, and policy (page 509) (emphasis
Solomon says the solution envisioned by
many experts is, "the eventual, long-term evolution to a single world monetary policy
based on a single or a few freely interchangeable world reserve currencies, managed by a SUPRANATIONAL
CENTRAL BANK" (emphasis added). He laments, "But how to get there from
here" (ibid. 509).
Highlighting the path to a single world monetary
policy is the need to solve the effects of the globalization process which was created by
the same people who wish to solve it. The Bank for International Settlements designed the
present borderless flow of monies between countries when it pushed for the deregulation of
monetary laws of the major North American, European, and Asian countries. By tearing down
national financial borders, they created the ability for $1.2 trillion daily to
flow around the world (uncontrolled stateless money) looking for the highest interest or
fastest currency play. In the process of solving the problem, the BIS will then extend its
tentacles down to the local level (which are not controlled or supervised by this
supranational organization) for a complete takeover of the world's banking system through
the Basle Core Principles--without even one bullet being fired---a fait accompli. By the
time the average citizen has figured this out-- much less those who are elected to
Congress--it will be too late.
History records for us a number of instances when
the world was ruled by large empires. The Tower of Babel was an attempt at political
unification, no mention is made of economic union. The empires of Babylon, Assyria,
Greece, and Rome were world empires both politically and economically. Napoleon in the
last century sought to unite Europe with one monetary and political system. Until this
century, there had not been an attempt to integrate all the countries of the world
economically. This changed with the passage of the Federal Reserve Act in 1913. As a
result of that legislation, the finances and the economic future of the United States was
shifted from the authority of the Congress and the U.S. Treasury to a private corporation
called the Federal Reserve. America was the last major country to change over to a central
bank system which would help facilitate the quest for a new world economic order.
Sixty-seven years later, the above economic
integration was greatly enhanced by the deregulation of the financial and banking industry
in 1980 (which led to $1.2 trillion moving around the world daily.) In addition the 1987
stock market crash and the failures of the Herstatt Bank, Franklin Bank, (Italian) Banco
Ambrosiano, Barings Bank, etc. have provided the "need" to fix the problem. As a
result of these failures, whether planned or real, the Bank for International Settlements
has determined that the strength of the international economic system lies with the supervision
of not only the world's banks but with insurance companies and brokerage firms as well
since they are all interrelated. Whoever supervises the banks has final say as to who runs
the world, for they will determine everything financial in a country.
A New World Economic Order
A new world economic order has been
evolving since 1930. First came the control of a country's finances through central
banking, then the establishment of the BIS, then the creation of the World Bank, the
International Monetary Fund, the United Nations, the Group of Seven (or Eight), and the
World Trade Organization.
During a visit to the museum of the Bank of
England in London recently, they had the history of the Bank on display, part of which
The proposal for a 'Bank of England' emerged from
a mass of....projects circulating at the beginning of the 1690's. William Patterson, a
Scotsman, is generally held to be its originator. A colorful figure, much traveled, he was
a key and regular promoter of financial projects. [He] proposed raising 1.2 million
British pounds to be lent to the government at 8% on the condition that the subscribers
were incorporated as a joint stock company [private corporation] with the title, 'Bank of
England.' The particular novelty is that there was no fixed time period for the loan and
that interest would be paid in perpetuity. In effect this meant the creation of a permanent
national debt. (emphasis added) Patterson was backed by a powerful group of City
merchants and also by Charles Montagu, one of the Commissioners of the Treasury, who
persuaded the government to introduce a Bill embodying the scheme. The Act was passed in
Controlling the world's monetary system
If you could control the monetary system of the
world, how would you do it? Very simply, you first start with your own country or a
country which would be easy to persuade. Then if you went systematically around the world
to other countries doing the same thing, it would not be long before the control of the
world's monetary system would be in the hands of a few men whose wealth and power would
grow with the size and number of countries they control and the size of the country's
debt, which would now run in perpetuity, providing an unending stream of income for
generations to the lenders and bondage to the debtor!
Has this happened yet? Unfortunately yes.
The first country to allow a private corporation to run their monetary system was Sweden.
Their central bank, the Sveriges Riksbank was founded in 1668. Central banking originated
in Sweden. Other countries allowing a private corporation to control their monetary system
include: Bank of France in 1803, Reichsbank (Bundesbank- Germany) in 1870, the Bank of
Japan in 1882, and the Bank of Italy in 1893. Let us not forget that it was Andrew Jackson
who refused to renew the charter for the first central bank in America in 1832.
The Federal Reserve - America's Central
After much maneuvering, distortion and
lies, the United States monetary system was given over to the Federal Reserve, a private
corporation, on December 23, 1913 when a small group of powerful senators stayed behind to
vote on the Federal Reserve Act while the rest of the Senate went home unsuspectingly for
the Christmas holiday. Today, there is not one country in the world that does not have a
"central bank" or private corporation managing their monetary system. The
Federal Reserve is said to be owned by the Rothschild Bank of England, Lazard Brothers
Banks of Paris, Lehman Brothers Bank of News York, Chase Manhattan Bank of New York,
Goldman, Sachs Bank of New York, Kuhn, Leob Bank of New York and others. It should be
noted that one of the reasons why the people of America cannot forgive themselves the
interest on the federal debt is because they do not owe it to themselves, they owe it to a
private corporation, the Federal Reserve.
The Bank for International Settlements -
The Central Bank's Bank
The shift in world power from independent
nation-states to one controlled politically and economically from the international level
has been gradual. In 1920 at the Paris Peace Conference there was a movement to have all
the countries of the world voluntarily join the League of Nations. Our Senate at the time
would not ratify this idea. However in 1945, the Senate ratified the United Nations
Charter. It was then that American sovereignty started to disintegrate as we became part
of a new form of political power which would gradually integrate us with the other
countries of the world into a new world order.
That same year at the International
Financial Conference in Brussels, which was under the umbrella of the League of Nations,
finance ministry officials, central banker and private bankers from nearly 40 countries
called for every country to have a central bank. In looking to bail out war torn Europe,
it was the Financial Committee of the League of Nations, guided by Britain's Montagu
Norman, which helped Europe get back on its feet by using Norman's model of central
banking and the men of his choice. Interestingly, it was Montagu Norman who led the call
throughout the 20's for central bank autonomy, i.e. freedom from political pressure. It
would not be until the 1990's that his dream would be achieved. (Marjorie
Deane and Robert Pringle, The Central Banks, Penguin Books USA: 1994, 56-61)
It was the Young Plan, sponsored by America
and named after the originator who then became the chairman of General Motors, which set
up the Bank for International Settlements in 1930. The formation of the BIS basically
"internationalized" central banks as it provided a location for the central bank
ministers to operate from. Some say that the BIS was to be an offspring of the League of
Nations. Located in Basle, Switzerland, "the BIS was told it should be a bank which
above all was to promote cooperation among central banks." (Ibid,
The seven central banks which formed the
BIS were: the Bank of England, the Bank of France, the Bank of Belgium, the German
Bundesbank, the Bank of Italy, the Bank of Switzerland and the Bank of Japan. At its
inception the BIS, according to the 1997 Annual Report, was given the legal structure of a
limited company with issued share capital. It is an international organization governed by
international law with privileges and immunities necessary for its performance of
functions. This legal personality of the BIS and privileges/immunities was
confirmed in the Headquarters Agreement concluded with the BIS and the Swiss Federal
Council on February 10, 1987. (emphasis mine)
The World Bank and IMF
The additional infrastructure added in
July, 1944 was the World Bank and International Monetary Fund which came into being at the
Bretton Woods Monetary Conference in New Hampshire. These institutions were the vision of
both socialist John Maynard Keynes from Britain and Assistant Secretary of the Treasury
Harry Dexter White (who was later convicted as a Soviet spy). Although these institutions
would initially provide the funds to rebuild war- worn Europe, they have evolved into very
powerful organizations in the last fifty-some years with greater and greater power.
Currently there are plans to provide the IMF with additional powers to make it "a
world central bank." The World Bank, which besides lending money for development
projects, establishes stock exchanges in third world countries, brings stock to market on
the international markets and is the largest syndicator of international bonds in the
world. The Bank also work very closely with Prince Charles and to establish and facilitate
the radical environmental mandates of the United Nations in all parts of the world.
The Group of Seven
In 1975 the Group of Five was formed. The Group
of Five came into being after the world's currency markets were forced to close twice in
1973. Today it is known as the Group of Seven (Eight) and is comprised of the top
industrialized countries of the world: the United States, Canada, Germany, Japan, Italy,
France, and Great Britain. Russia became a full partner in June, 1998. The Group of Seven
(less Russia) is considered a "global board of directors." As a result of their
economic power, they basically set the agenda which the rest of the countries in the
United Nations follow.
As a result of the above, the countries of
the world have become nothing but pawns in the hands of powerful central bankers who rule
and control the presidents and prime ministers of the world. For example, it should be
noted that Korea, Thailand, and Malaysia wanted to maintain some economic sovereignty by
keeping control of their major banks and industries. This was not in line with the World
Trade Organization Financial Services Agreement which called for financial integration of
banks, insurance companies, and brokerage firms. Almost over night the currencies of these
countries were devalued and their economies rendered insolvent. Did this happen by
"chance" or was it planned?
Dr. Carrol Quigley, Bill Clinton's mentor at
Georgetown University, said this about the Bank for International Settlements in his book Tragedy
....[T]he powers of financial capitalism
had another far-reaching aim, nothing less than to create a world system of financial
control in private hands able to dominate the political system of each country and the
economy of the world as a whole. This system was to be controlled in a feudalistic fashion
by the central banks of the world acting in concert, by secret agreements arrived at in
frequent private meetings and conferences. The apex of the system was to be the Bank for
International Settlements in Basle, Switzerland, a private bank owned and controlled
by the world's central banks which were themselves private corporations. The BIS as a
private institution was owned by the seven chief central banks and was operated by the
heads of these, who together formed its governing board. The BIS is generally regarded as
the apex of the structure of financial capitalism whose remote origins go back to the
creation of the Bank of England in 1694 and the Bank of France in 1803" (Tragedy and Hope, 324-325) (emphasis
The BIS Expands
In 1994, the Federal Reserve System was welcomed
to occupy the two seats on the Board of Directors to which the central bank of the United
States had been entitled since 1930. Alan Greenspan became an ex-officio member of the
Board and appointed William J. McDonough, President of the New York Federal Reserve, to
serve as a member of the BIS Board for a period of three years.
In September, 1996, the Board of Directors,
compromised of the Group of Ten, admitted nine new members from the central banks of:
Brazil, China, Hong Kong, India, Korea, Mexico, the Russian Federation, Saudia Arabia and
Singapore. In 1997, four additional central banks were invited to buy into the BIS: Bosnia
and Herzegovina, Croatia, Macedonia and Slovenia. Today a total of 120 central banks and
international financial institutions use the BIS as a bank with 45 central banks having
the rights of representation and voting at the General Meetings. In essence, they are a
"United Nations of central banks."
In addition, the BIS opened up a Representative
Office for Asia and the Pacific in Hong Kong in 1998. It's purpose is to strengthen
further relations and information sharing among the region's central banks and monetary
The BIS is engaged in many activities, all of
which, they say, are to "foster international monetary cooperation." First, the
BIS is a forum for international monetary cooperation. Since 1971, the Group of Ten
Central Bank Governors meet on a monthly basis at the BIS to determine the direction of
international monetary policies. The Bank has a Committee of Experts on Gold and Foreign
Exchange which monitor ongoing financial developments as they relate to central bank
polices and operations. In 1974, the Basle Committee on Banking Supervision was set up.
They maintain cooperation with other regional central bank organizations such as the Gulf
Cooperation Council, the South African Development Community, and the Central Banks of
South East Asia, New Zealand and Australia, to name a few. The BIS offers technical
assistance for the central banks of eastern Europe, the former Soviet Union and some Asian
countries. They also participate with the World Bank, its various regional banks, the
International Monetary Fund, and the Organization for Economic Cooperation and Development
in a training institution called the Joint Vienna Institute which was set up in 1992. They
also organize meetings of central bank economics and other experts on a variety of
matters. On a quarterly basis, they publish, "International Banking and Financial
In addition, the BIS performs functions as
Trustee, Fiscal Agent or Depositary with regard to a number of international loan
agreements. They also perform the functions for the European Payments Union, and function
as a collateral agent.
The BIS has expanded their auspices as a result
of the globalization process, the rise of the derivatives market, and what appears to be
the standardization of monetary policy on a worldwide basis to coordinate both interest
rates and growth in GDP. As a result of the globalization process, i.e. the tearing down
of financial and investment laws and regulations between countries, $1.2T flows
around the world on a daily basis looking for the highest return or fastest play to net
the greatest profits. Banks, financial firms, private speculators and corporations play
this game of "global roulette." This has increased the role which the BIS plays
in the global markets as it has become concerned with "banking supervision"
which is what the rest of this report will concentrate on. Whoever supervises the banks
has ultimate control and say in the affairs of the country and the bank.
Background to The Basle Committee on
The BIS established the Basle Committee on
Banking Supervision in 1975. It consists of senior representatives of bank supervisory
authorities from Belgium, Canada, France, Germany, Italy, Japan, Luxembourg, Netherlands,
Sweden, Switzerland, the UK, and the U.S. As a result of the Herstatt Bank collapse in
1974, the BIS approved the Basle Concordat. For some reason the contents of this document
were kept secret until March, 1981. The Concordat layed out responsibilities for
international banks, a new first for the world. With this Concordat, a
supranational bank (the BIS) was issuing orders for the rest of the national banks of the
world. The BIS realized that the Concordat would work only if all central bankers were
capable and willing to execute it and therefore it would have to be endorsed and
implemented by all. In July, 1982, Italy's Banco Ambrosiano collapsed leaving eighty-eight
international banks with debts of $600 million. In response, the Basle supervisors drew up
an amended second Concordate in 1983 which emphasized the spirit of shared responsibility
and the adequacy of each other's supervision - that of the parent and host country (Solomon, Confidence Games, 119).
Within six months of the 1987 Stock Market Crash,
the Basle Capital Accord was endorsed by 90 national bank supervisors and implemented by
the US, UK, and Japan. In 1988, the Basle Committee issued the Basle Capital Accord which
set out minimum capital standards for each bank to have. In other words for an
international bank to keep its doors open, it would have to have a minimum amount set
aside to require the capital standard. In 1992, with the endorsement of the Group of Ten
central bank governors they agreed to apply the minimum standards in the supervision of
international banking groups.
In April, 1990 the Committee reviewed the
supplement to the Concordat which provided guidance for ongoing contract and collaboration
among supervisory authorities and spelled out the extent of information sharing among the
supervisory authorities. While some of this oversight may be needed, if America is a
sovereign nation, then these guidelines should come from our Congress and not a
As a result of the breakdown in the
European Rate Mechanism in 1992, the Group of Seven became increasingly concerned with not
only the movement of $1.2T around the world on a daily basis but also with the stability
of the currency markets. In 1993, the Basle Committee created the "Tripartite"
which is comprised of bank, securities and insurance regulators which are the Basle
Committee on Banking Supervision, the International Organization of Security
commissions-IOSCO and the newly created International Association of Insurance
Supervisors-IAIS respectively. Both the Basle Committee and the IAIS are located at the
BIS while IOSCO is in Montreal. IOSCO considers itself "the United Nations of
Securities Regulators (stock exchanges)." Arthur Levitt our Securities and Exchange
Commissioner has stated, "There has never been a greater need for us to work
together. We (ISOCO) regulate one of the most innovative industries on the face of the
earth, whose main commodity-- capital--has little regard for national borders. We must
expand our cooperation to cover regulatory issues beyond enforcement." (IOSCO
In September, 1996, the Basle Committee
decided to build on its earlier work by preparing two separate publications: a
comprehensive set of Core Principles for Effective Banking Supervision and a Compendium
which brings together the existing Basle Committee recommendations, guidelines, and
standards (1997 BIS Annual Report, 171-172).
The Core Principles sets out 25 basic
Principles that must be in place for a supervisory system to be effective. They cover: (1)
preconditions for effective banking supervision, (2) the licensing and structure of
institutions; (3) prudential regulations and requirements; (4) methods of ongoing banking
supervision; (5) information requirements; (6) the formal powers of supervisors; and (7)
In looking to understand more clearly the
real effect of these "rules of the road," I attended the June, 1998 Annual
Meeting of the Bank for International Settlements. There I interviewed Andrew Crockett,
Managing Director of the BIS and Charles Lakewood, Deputy Managing Director and Chairman
of the Basle Committee on Banking Supervision.
Mr. Crockett responded to my questions on
the Basle Core Principles by saying,
What is needed to make sure that the cooperative
mechanisms amongst supervisors and regulators are constantly maintained at the most
effective level. We have supervisory regulatory responsibilities that are first of all
divided on national grounds--inevitable when you have individual nation-states, in many
countries it is also divided according to the historical concentration of different
financial activities--insurance regulators, commercial bank regulators, investment bank
regulators, and so on. What we are now recognizing in a global financial market is that
the boundaries between nation-states and the boundaries between different categories
between institutions are becoming blurred so that banks are acquiring insurance
companies and vise versa. The banks are going cross-border and acquiring other banks in
cross border deals, some times as partners, some times as subsidiaries, some times as
complete absorption into the same institution. This creates the multiplicity of
organizational forms that need to be regulated and supervised. What we are calling for
I think, and I believe the IMF and others are doing the same thing, is that there
should be a clear division of--allocation of responsibilities so that first of all
institutions which are increasingly working in the fields of other institutions--banks
taking on insurance companies-- are subject to the same set of regulations so that nothing
falls between the gaps--and also so that there is a clear appreciation on the part of
supervisors what their responsibilities are to the stability of the international
financial system (emphasis added).
The Asian crisis among other experiences
has shown that weaknesses in financial systems can have enormously damaging
consequences. What we want to make sure is that international best practice is adopted
among all the countries that are likely to be vulnerable and all countries so that we can
have comprehensive supervisory structure. Up to now that has not been fully comprehensive.
With the development of the Core Principles of the Basle Committee on Banking
Supervision and the extension of similar principles to other kinds of activities and other
kinds of financial institutions to other supervisors that should become more and more
possible (emphasis added).
When I asked, "Who do they report
to?" Crockett responded:
Well this is a good question a question to
which there is no answer. It is not a formal grouping with a mandated or an
international treaty. The Basle on Banking supervision reports to the Governors of the
Group of Ten countries. That's our understanding, not a formalized arrangement. It is
basically a forum whereby national experts can come together to set standards and so too
is the IAIS, those are not organizations that report to any higher body such as the IMF or
BIS or Min. of finance but are associations of equal supervisors from their national
authorities. (emphasis added)
In an in-depth follow-up interview with
Charles Lakewood, he described the process of supervision this way:
For about 15 or 20 years, bank supervision was a
kind of low level technical matter where the central banks through the Basle Committee did
the technical work. It is only with the Capital Accord that it became more high profile.
There weren't any competitors to the Basle Committee for some years. In the last two to
three years there have been a number of competitors coming up. We have seen the IMF/World
Bank get into supervision in a much bigger way. They have recruited a lot of high powered
people. Individually those people are strong but they don't have a mechanism for decision
making. What the IMF can or will do or the World Bank can or will do in their
constituencies is the real crux of the matter. What we are trying to do is make sure that
the advice of the World Bank or IMF is consistent with the best practice and the lessons
we have learned from dozen and dozen of events.
He stated that the members of the Basle Committee
are solo meetings of the Group of Ten alone with the exception of an observer from the
European Union. Furthermore he stated with regard to the role of the World Bank and the
IMF that they are "playing an increasingly important role." The Basle Committee
has created two new groups to monitor the implementation of the principles. One is quite
small with the IMF/World Bank in that group with eighteen countries and the EU.
The whole truth about the Basle Core Principles
is to be found in the matter of compliance. If these are only "guidelines or
recommendations," as they have said, then why would they look to eventually punish
and penalize a country which does not adhere to these principles? In response to a
question on the kind of penalty for non-implementation, Lakewood said this,
"Compliance is going to be difficult. If compliance is going to be difficult, then
penalties and punishments are even more difficult. At this point in time we are just
trying to get the thing started and encourage countries to look at these and try and
improve the structure they are working with. Further down the road, we will have to make
that decision as to what to do when people are plainly non-complying."
When I was in London for the Group of Eight
Finance Ministers meeting, I asked Secretary Robert Rubin if the adaptation of the Core
Principles would have to go through Congress and he replied no. When a lady friend of mine
told Congresswoman Helen Chenoweth what Rubin had said, my friend told me that her eyes
got as big as saucers and she exclaimed, "He can't do that. He's by-passing
Conclusion - "HOW TO
GET THERE FROM HERE"
As a result of the globalization process
and the monetary uncertainty which has been created by a floating system of exchange,
there would have to be some type of global overseer. However, the more power this overseer
is given, the more power they have over nations and kings. In addition, there is no
provision to abide by the U.S. Constitution or that of any other country's because a new
set of rules has been set up which the nation-states have ceded their rights to. The Bank
for International Settlements, as a result of what they are, have extreme power. Now they
are looking to extend that power from the global to the local as they apply the Basle Core
Principles to local banks worldwide. The following are several additional proposals for
continued global monetary reform as found in Confidence Games:
1. Putting a uniform transaction tax of .5%
on all spot foreign exchange transactions, including deliveries on futures contracts and
options. This is called the "Tobin Tax" and has been supported by the United
Nations as early as 1995 when at the United Nations Social Summit in Copenhagen, the
United Nations tried to raise awareness for it by making it part of most of their press
briefings and workshops. At the Group of Eight leaders meeting in Birmingham,a
group protesting against the Group of Eight sponsored a workshop on "Alternative
Economics." I interviewed one of their leaders who was touting the Tobin Tax. When I
asked what they would use the estimated $1.5T in revenues for, he told me it would be used
for environmental purposes and perhaps be put in a mutual fund to be managed by the United
Nations. When I asked England's Prime Minister Tony Blair to comment on the Tobin Tax, he
replied that it wasn't on the agenda.
2. Create a buffer mechanism so that
nations could regain more flexibility to pursue divergent monetary policies. This too
would raise as much as $13T a year in revenue which could be turned over to the BIS to
pursue interventions to stabilize currencies or carry out a "lender of last
3. Create a type of "FDIC insurance" on
foreign exchange transactions. When a country buys a foreign currency, have them put a
small percentage in a noninterest bearing account with its central bank.
Is it a coincidence that written on the walls of
the Rathaus, the Townhall, in Basle which dates back to 1601 are these words:
FREEDOM IS GREATER
THAN SILVER AND GOLD!
(UN Watch, The Women's
International Media Group, Inc., Joan M. Veon)
WHO ARE THE GROUP OF SEVEN?
"The interdependence of our
destinies makes it necessary for us to approach common economic problems with a
sense of common purpose and to work toward mutually consistent economic
strategies through better cooperation..." (emphasis added)
Group of Seven 1976 Joint Declaration from
San Juan, Puerto Rico
"Over the past fourteen years, the world
economy and economic policy have undergone profound changes. In particular, the
information technology revolution and the globalization of markets have
increased economic interdependence, making it essential that governments consider
fully the international dimensions of their deliberations." (emphasis added)
Group of Seven 1988 Economic Declaration,
"We agree that the protection and
enhancement of the environment is essential. The report of the World Commission on
Environment and Development has stressed that environmental considerations must be
integrated into all areas of economic policymaking if the globe is to continue to support
humankind. We endorse the concept of sustainable development. Threats to the
environment recognize no boundaries....The Montreal Protocol on Substances that Deplete
the Ozone Layer is a milestone. ...Further action is needed. Global climate change, air,
sea and fresh water pollution, acid rain, hazardous substances, deforestation and
endangered species require priority attention." (emphasis added) Group of Seven 1988
Economic Declaration, Toronto, Canada
"We the Participants in the Lyon
Summit....discussed how we could build a better international system to
secure security and stability...In an increasingly inter-dependent and inter-active
world with rapid globalization in progress, we renewed our determination to
work together amongst us and in partnership with leaders of other countries..." (emphasis added)
Group of Seven 1996 Joint Declaration from
people, the phrase "Group of Seven" has no meaning because of the lack of
understanding as to the part they play in international affairs. However, since 1975, the
leaders of the most industrialized worlds have met throughout the years to discuss global
problems and how the world should approach the 21st century. While the conventional
thinking of most Americans is that each country is responsible for their own
fate--economic, social, political and environmental- - according to the Group of Seven,
the "interdependence of our destinies makes it necessary...to work toward mutually
consistent economies strategies through better cooperation..."
Who are the Group of Seven? How long have
they met? What have they done? Exactly who appointed them to build a "better
international system"? What authority do they have---or have they taken?
The Group of Seven first met in 1973, two
years after President Nixon severed the last attachment the dollar had to the gold
standard when he suspended the rights of foreign countries to convert their paper-dollars
to gold in August, 1971. The world monetary system since that time has been based on a
faith in paper currencies which float against each other, according to good or bad
economic and political news. Between 1971 and 1973, the world monetary leaders tried to
keep the world's system glued together by agreeing on the parameters that the dollar float
against the yen and Deutsche mark. By February, 1973 that accord, known as the
"Smithsonian Agreement," fell apart when the dollar dropped below those
parameters. (Although The New York Times states the reason for the drop in the
dollar is due to multinational companies, banks, Middle East oil countries and private
investors selling dollars, they did not establish any controls to curb "speculative
trading.") By 1973, the world monetary markets were closed on two occasions,
Valentine Weekend in February and the beginning of March for three weeks while Central
bank governors met at the Bank for International Settlements to determine the new value of
the dollar. At the time, Arthur Burns, chairman of the Federal Reserve Board said there
was a "collapse of confidence" and told congress that "the task of
overhauling the international monetary system must be done in a matter of months rather
than years." (NYT 3/2/73)
Due to the monetary instability caused by
taking the world's monetary system off of the gold standard in August, 1971 and the fact
that various groups of people, called "speculative investors" could now buy and
sell large amounts of any countries' currency on a whim to make a profit, President Nixon
in May, 1973, called together U.S., French, British and German finance ministers to meet
informally in the White House library while he, French President Georges Pompidou, Prime
Minister Edward Heath and German Chancellor Willy Brandt met in the Oval office. As
reported in the June 23-29, 1995 edition of The European, who quoted a German
participant, "We agreed there was a need for someone to be in control again on an
international scale. We hardly knew each other prior to the meeting. But mutual
appreciation and sympathy developed as we talked, laying the ground for successful
cooperation." Hence the idea of a group of world leaders meeting to
"monitor" the world's currencies markets was born.
The first official meeting of the then-Group of
Five, met in Rambouillet, France in 1975. The participants of that first meeting were the
United States, France, Germany and England who invited as well, Japan and Italy. In 1976
Canada was invited, thus making it the "Group of Seven." In 1978, the President
of the European Community was invited to join. Then in 1991, President Mikhail Gorbachev
was invited to participate in the economic side of the G-7. Gorbachev called his
unofficial presence the "Group of Seven plus one." Russia has participated since
then and for the last several years participates, we are told, only on the political level
as they are considered a key political power by the other G-7 countries, however, their
ministers meet when the G7 ministers meet.
The European in June, 1995, described the
power and position of the Group of Seven as being the top industrialized countries of the
world. The article stated that they dominate "the global financial and banking system
and their currencies have reserve status in the rest of the world." In addition, they
work with a number of international bodies including the Organization for Economic
Co-Operation and Development (OECD) in Europe, "hold close to 40% of the votes at the
IMF and the World Bank and from a "diplomatic point of view, are all permanent
members of the United Nations' Security Council."
In comparing the depth, breadth and width
of the activities covered by the G-7, their first communiqué, which is considered their
final statement of the meeting and actions they will take, was one and a half pages long.
In Lyon, the final communiqué, called "Chairman's Statement," issued by
French President Jacques Chirac, was 22 pages in addition to a six page statement by the
"P8 - Senior Experts Group" listing 40 recommendations on how to combat
transnational organized crime, and a seven page statements by the G7 Finance Ministers on
"International Monetary Stability." From overseeing the stability of the
monetary system, the G7 plus one are now are concerned with both the macro as well
as the micro-economic problems, as well as the environment, crimes/terrorism and
It appears that the Group of Seven operates in
"cycles." According to Professor John Kirton from the University of Toronto, the
first was from 1975 to 1981 and consisted of annual meetings with the leaders, accompanied
by their ministers of foreign affairs and finance. From 1982 to 1988, they added regular
stand- alone meetings of ministers of trade in 1982 and foreign affairs in 1984 and
finance in 1986 as well as an inter- sessional special Summit in 1985. In the third cycle,
from 1989 to 1995, saw the birth in 1991 of the "annual G7 post-Summit meeting with
the USSR and then Russia, the emergence of environment ministers in 1992 and a flurry of
ad hoc ministerial meetings from 1993 onward, dealing with assistance to Russia and
Ukraine to the micro economic issues of jobs and the information highway."
On the ministerial level, for example, the
finance minister of the United States, as well as our trade and Secretary of State appear
to function not only in his/her appointed duties for the United States but also in a
"global framework" for the Group of Seven . They then meet throughout the year
with their counter-parts from the other G7 countries. Over the years, these various
ministers, have also met with the directors of the United Nations agencies, the IMF/World
Bank, the OECD, and the Central Bank Governors. Due to the escalating importance and power
of the G7, some have called them a "global board of directors" to the United
Nations while others have termed them a "global economic commission." Professor
Kirton likens them to "the global equivalent of the concert of Europe" (between
1818 and 1914, it is felt that these European powers helped keep peace in Europe).
He also writes that "in 1977, when
Carter became President, he appointed a trusted advisor, with cabinet rank to work on
summit preparations on a full-time, year-round basis. Since that time all countries have
employed specially designated personal representatives or 'Sherpas' who normally serve on
a continuing basis for several years. These Sherpas meet formally on at least four
occasions throughout the year preceding the summit, as well as at the opening of, and
throughout the summit itself. They are supported by an elaborately layered network of
'sous-Sherpas' (either from foreign or finance) and 'sous-sous- Sherpas.'"
Facts about the G7
One of the most amazing things for the writer is
that while she has read a fair amount of UN Programmes of Action in the last several
years, it was her impression that all of the "recommendations" made came from
the United Nations, however, in reading the Group of Seven documents, it appears that
these recommendations originate from the Group of Seven who direct the United
Nations, (that's us) where they need to go and what they need to do in order to come into
compliance with the wishes of this global body.
The writer asked by Canadian Prime Minister Paul
Cretien and European Commission President Jacques Santer "Who does the Group of Seven
report to? The United Nations? Or does the United Nations report to the G7?" Both of
these men basically said that no one reports to anyone, that the G7 come out of the UN and
that they both have the same global concerns. The better question should have been,
"Who does the G7 report to?"
According to Professor Kirton, It was due
to an agreement between the G7 leaders that they all make a combined effort to be at the
1992 UN Conference on Environment and Development to show their full support.
Interestingly enough, no mention of the enviorment is made bewteen their first meeting in
1975 and 1988.
While many people thought the environmental
agenda was a "passing phase", it is not. All of the programs of the UN, the
World Bank, and IMF now incorporate the environment as part of their goals and operating
procedures. Whenever the World Bank now makes a loan, the terms have been
"enviromentalized" meaning every country in order to get the monies must now do
certain things environmentally in order to qualify. In addition, whenever the UN holds a
conference, they appoint a follow- up committee to monitor the progress of each country's
progress as they comply with the terms of the conference.
It appears, without going into all of the last 22
meetings which the G7 have held that they have been bringing the economies of the world
into "harmonization." This is being accomplished through a number of steps and
laws, both national and international and between numerous supra-national organizations
like the Bank for International Settlements (BIS), the International Organization for
Securities Commissions (IOSCO), the International Insurance Association, and others.
In the last five years, in addition to economics,
they have discussed a number of topics such as, aid to Russia, the changing role of NATO
and the Conference on Security and Cooperation in Europe--CSCE, farm subsidies,
jobs/unemployment, trade and the environment.
The Sherpa are an ethnic group in northeastern Nepal. They
inhabit several high valleys, at altitudes between about 2,400 and 4,000 m (8,000 and
13,000 ft), in a region called Solu-Khumbu, on the southern slopes of the central Mount
Everest ridge. In the 16th and 17th centuries they migrated to their present home from
Khams, an eastern province of TIBET. Their name is derived from sherwa (spelled sharpa in
Tibetan), "eastern one." They are closely linked to Tibetan culture, speaking a
Tibetan dialect and practicing TIBETAN BUDDHISM of the unreformed rNying-ma-pa sect.
Group of Seven (international affairs)
The Group of Seven (G-7)--Canada, Britain, France,
Germany, Italy, Japan, and the United States--is an association of the world's seven
leading industrialized nations. Founded in 1973, it deals with mutually important issues
of aid, trade, long-term economic growth, and security. Heads of state of the seven meet
annually, other representatives occasionally. The so-called Quad group, of the United
States, European Union, Canada, and Japan, held its first meeting in 1993
A group of seven faint stars, the Little Dipper is part of
a larger group, the constellation Ursa Minor, the Little Bear. The group contains POLARIS,
the North Star, which lies very close to the celestial north pole. A second-magnitude
star, Polaris is at the end of the dipper's handle (the bear's tail) and appears nearly
stationary in the sky as all other stars revolve around it. The second brightest star in
the group, Kochab, was closer to the pole about 2,000 years ago; hence its name is derived
from the Arabic word meaning polestar.
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