THE ULTIMATE ARGUMENT AND THE ULTIMATE TEST
Copyright 2002 J.N. Tlaga
In Amicus Curiae Argument of October 22, 2001 -
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- very truly yours brought to the attention of the US District Court in Boston,
(1) that because of across-the-board collateralization of reversible gold transactions, every single ounce of central banks gold that
is now swapped, on loan, or under repurchase agreement is for all practical purposes irreversibly sold in exchange for US Treasury securities, and
(2) that all such irreversible sales of central banks gold in exchange for US Treasury securities were rendered not reportable to the legislators and to the general public by way of extra legal "authority" cooked up at the IMF by the proxy of BIS and later adopted by the ECB, and
(3) that US Treasury does not keep current ownership record of its securities that are sold through the Federal Reserve "Primary Dealers" and Federal Reserve controlled banks.
The purpose of that disclosure was to make the Court realize that unless the Federal Reserve's books and records were produced for inspection in the course of discovery procedure, there was no practical way to ascertain the actual ownership status of central banks gold and the true extent of "gold carry trade" complained of by the plaintiff.
There are two kinds of fiat money in circulation:
(1) Federal Reserve notes, which earn no interest, are used as cash by the general public, and are commonly known as "US dollars", and
(2) US Treasury securities - bills, notes and bonds - commonly known as "US bonds", which earn interest and, unbeknownst to general public, are used as cash in global banking and new-world-order trade.
Transactions paid in "dollars" are subject to reporting, control, and restrictions related to income tax and "money laundering", but transactions paid in "bonds" fly under the income tax radar, and unleashing IRS dogs by the Fed upon such transactions depends entirely on who the parties are. "New-world-order trade", as it applies to the United States, is a shorthand for a predatory system, which, essentially, consists of the following:
(1) Closing down factories in the United States where wages and taxes are high, currency is overvalued, and the cost of environmental protection is high;
(2) Opening the same factories in low wage countries with undervalued currencies and non-existent environmental protection;
(3) Exporting products of so transplanted factories back to the United States to maximize profit due to wage and, especially, rate of exchange differentials, and to apply the "go abroad or go bankrupt" squeeze on the patriotic manufacturers who resist the pressure to move their factories abroad;
(4) Supplying the US populace with excessive consumer credit, progressively offset against real estate equity, whose appraisal is in turn pumped up far beyond its real value, in order to provide market for imported goods at the expense of equity created by prior generations (selling America from under feet of her people).
Following the Amicus Curiae Argument, very truly yours submitted in "Thanksgiving Day Question" a direct inquiry to Dr Ron Paul, Texas Representative in Congress, whether or not was it his intention to seek the office of the President of the United States in the general elections of November 2, 2004, by way of early declared campaign, whose objective would also be to renew House and Senate.
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And one week later, in a proposal THE ALTERNATIVE FUTURE, a Call for Overnight Revolution was made with declared intention to open national debate on how to transform the present fiat money regime into an honest-money regime without harming the economy. What is unique about this proposal is that the morning after the proposed overnight revolution the money supply remains unchanged, and economy proceeds as usual, while all the Federal Reserve notes and all the Treasury securities have been neatly excised from circulation. The task to abolish the fiat currency without destroying money supply as such has always been pictured as impossible dream, and thereby the strongest argument for maintaining fiat money forever. THE ALTERNATIVE FUTURE puts this false argument to its well deserved rest.
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And this Call for Overnight Revolution was meant to be not only the ultimate proposal to return to honest money, but also the ultimate argument in "Howe vs BIS" and the ultimate test of our national will to return to honest money.
It came to me as an afterthought, that the argument the defendants in "Howe vs BIS" were most likely relying upon was absent from the record of their case. What if - I could not help not to ask myself - the myth that there was no viable alternative to the fiat money regime was set adrift to reach Judge Lindsay innocuously from many directions in order to leave what professional spin artists call "adequate residue". This residue could in time graduate to the reasoning that even though the fiat money regime and
its gold price manipulation scheme was nothing short of criminal, its only alternative was worldwide chaos. Therefore, decision for the plaintiff, upholding the rule of law, would in effect amount to upholding anarchy, while decision for the defendants, although repugnant to the existing law, would in effect amount to upholding the rule of law, no matter how limping this rule might appear to be as a result thereof.
This kind of sophistry, ending in the open embrace of irrational conclusion, would not be unheard of to the lawyers among us, but it could be prevented by publishing an argument amply demonstrating that there was a viable alternative to the fiat money regime. Once published, such an argument could not be unpublished, meaning, no spin artist could vacuum it from people's minds and from public domain. We may never know whether this ultimate argument, solely by virtue of its existence, will in the end be helpful in shaping the Court's decision in "Howe vs BIS", but procedurally, it would not be proper nor graceful to seek to file it as an amendment to Amicus Curiae Argument.
When the Order of US District Court for the District of Massachusetts, denying my motion for leave to file Amicus Curiae Argument in "Howe vs BIS", became known to me on November 29, I managed, via postings during 20:00 Hours segment of Gold Forum
( www.gold-eagle.com/cgi-bin/gn/get/forum.html ), to prevent premature comments which, I feared, might not fit the proprieties of the court decorum, which in my book also apply outside the courtroom. But I could not preempt private questions, which kept hammering at two points:
(1) How come your brief misspells Dred Scott as "Dread Scott"?
(2) How come your brief "does not cite a single case or statute"?
I knew about "Sanford's Curse". (Because his name was erroneously "corrected" in DRED SCOTT v. JOHN F. A. SANDFORD, the plaintiff's name will be similarly "corrected" until the end of time.) And yet, I found myself involuntarily executing this curse as cast, not unlike the famous Cardinal, who, notwithstanding endless admonitions against such pitfalls, still managed to say in Easter sermon: "Before the cock denies, Peter will crow trice." And just like that famous Cardinal, I will forever wish for that
momentary pause before my error was set in stone. The whole amicus argument was drafted, edited and printed between Friday night and Monday morning. Haste makes waste.
How come my brief "does not cite a single case or statute"?
Because in my view there is no case or statute to cite.
The whole point of my argument is that "Howe vs BIS" is a unique case, whose correct adjudication requires discarding and not citing (i.e. upholding) wrongful precedent cases and wrongful statutes. Federal Reserve System and its fiat money regime are as illegitimate as the slavery system used to be. The statutes and cases in its favor are not to be cited and upheld, but summarily scraped.
Under the ancient "stare decisis" doctrine, the Common Law rule requires that court decisions once made should be upheld by posterity. As a result, the body of Common Law grows by squeezing the later cases into the pigeon holes of the earlier cases. Often the interpretations employed to make the later cases fit the precedent cases stretch both the Common Law and common sense.
Then one day a trial court discards a long line of such squeezed-in precedent cases on the theory that they represent impermissible deviation from the prior good law. Such a rejection, if sustained by the appellate courts, overrules the affected line of precedents, and resets the clock back to the prior good law.
If the Supreme Court of the United States would have summarily discarded slavery cases and statutes in its Dred Scott ruling, the history of these United States would have been completely different than it was, because the Civil War would have never taken place. To this day, Southern gentlemen can be heard calling it "the Northern Aggression War". In my view, it was "the Supreme Court's Inadequacy War". When Horatio Nelson sailed into the battle of Trafalgar, his ship signaled to the fleet: "England expects
that every man will do his duty." In 1856, Dred Scott signal - "America expects that Supreme Court will do its duty" - fell on blind eyes and deaf ears.
The Supreme Court should have taken the position, that precedent decisions and colonial statutes upholding the status of African slaves as that of a chattel property of their owners were null and void, because they represented impermissible deviation from the earlier precedents and statutes, and, in any case, they were abrogated by the Declaration of Independence, which must be interpreted as universal in scope. There may not be any limitation on freedom or any exclusion from freedom. Freedom is like love; either it exists and then it's absolute, or it's not absolute and then does not exist at all.
Instead, the Supreme Court invalidated the Missouri Compromise and ruled that it was legal under US Constitution to extend slavery to all free states and territories, essentially, because to rule otherwise would deprive slave owners of their lawful property whenever they would choose to travel to a free state. Abraham Lincoln, who believed the Declaration of Independence was valid universally, characterized this reasoning and the legal reality it heralded, as follows:
... if any one man choose to enslave another,
no third man shall be allowed to object.
"Howe vs BIS" is a Dred Scott case of our time. It challenges the fiat money system, which, next to slavery, is the second cancer on American democracy. And the US District Court in Boston does not have to overrule any wrongful statute or precedent case upholding it. All that is needed to do away with this cancer is to deny the defendants motions to dismiss and let the case proceed into its pretrial stage.
When the discovery procedure will begin, and Reginald Howe will serve a Notice to Produce the Federal Reserve's registry of US Treasury securities transactions, this will be the beginning of the end of the Federal Reserve System. For the first time in history, everyone will know who is paying to whom for what and why in the underground currency of US Treasury securities.
Only a small part of US Treasury securities is sold directly to the public and registered at the US Treasury. The bulk of these offerings is bought by the Fed itself and the Fed-anointed "Primary Dealers" who register all subsequent transactions with the Federal Reserve Bank of New York. This record of US Treasury securities transactions is needed to guard against unlicensed counterfeiting (in contrast to the licensed counterfeiting which produces US Treasury securities in the first place).
In the old days, when US Treasury securities were issued in printed form, mafia enterprises printed their own "US Treasury securities" to be used abroad as collaterals for business loans. In due course, the loans would be repaid, "collaterals" would be returned, and in theory US Treasury should never have any reason to suspect additional securities were in circulation because they would never be tendered in for redemption, they would only be used as collaterals. But reality is always different than theory. When Franklin National Bank collapsed as a result of heavy losses in foreign exchange operations, the paper trails of the parties holding other end of FNB transactions led to bogus US Treasury securities.
US Treasury securities are issued in electronic form nowadays. When J.P. Morgan offers US Treasury securities to some central bank as collateral for a gold loan, how does the bank know that such electronic securities are genuine and were not made up by J.P. Morgan's subsidiary, who is one of the "Primary Dealers"? The bank knows securities are genuine because Federal Reserve Bank of New York says so.
Obtaining this track record of US Treasury securities changing hands all over the world, will supply the track record of what is really happening in "global economy". A record of transfers of Federal Reserve notes, such as that of Clearing House Interbank Payment System (CHIPS), does not supply this essential information.
When J.P. Morgan borrows gold from Bundesbank and wires collateral of US Treasury securities, the transaction is recorded in Federal Reserve Bank of New York but is absent in CHIPS record.
We have every right to expect that the records of gold borrowings from US Treasury will be utterly entertaining. E.g., Goldman Sachs borrows gold from former employee, Robert Rubin, in his capacity of the Secretary of the Treasury of the United States, and wires him a collateral of US Treasury securities. Rubin puts these securities in "deep storage" to be released to Goldman Sachs when Goldman Sachs returns the borrowed gold. But instead of returning the borrowed gold, Goldman Sachs wires another load of US Treasury securities as collateral for another gold loan. In the end, during Mr Rubin's tenure as Secretary of the Treasury, Goldman Sachs and other gold bullion dealers borrowed much more gold than could be produced or reacquired on gold market within reasonable time. As a result, when Mr Rubin resigned as Secretary of the Treasury, he left behind what con men
call... "a situation". Treasury may not call in the gold loans, because this would expose the fact that they are not repayable, which would force canceling collaterals and official disclosure of the loss of gold to Congress. (Unofficially the whole Congress knows about it, which is yet another reason to begin replacing it in the incoming elections.) In order to maintain a false pretense that national gold bullion reserves are intact, Secretary of the Treasury and the President himself not only deny the loss, but continue to give away the remaining gold reserves which could still be saved. When ultimately confronted about it, they will inevitably claim they had no choice, because their only alternative would be the worldwide economic collapse. (And this, of course, is the same kind of fallacy, as that the abolishing of fiat money would result in destruction of money supply and return to
barter economy.)
This whole story, and much more besides, can be deducted from US Treasury securities registry at the Federal Reserve Bank of New York.
The shredding of transcripts of the proceedings of the Fed's Open Market Committee, that is generating so much of hullabaloo these days, is a red herring device by which the establishment planners hope to highjack Ron Paul's mantle for someone like Ralph Nader or Harry Browne, whose job will then be to steer the national opposition into a ditch. From the day one, those FOMC transcripts were introduced as a disinformation instrument. (Intelligence agents routinely maintain diaries in which they lie to themselves in order to mislead counterintelligence and to condition their own minds.)
Again, US Treasury securities are used as cash by global enterprises, and this insulates the affected transactions from any inquiry of tax authorities, such as Internal Revenue Service. Only the transactions involving Federal Reserve notes, i.e., paper dollars, are reported to the IRS. The records of transactions paid for with US Treasury securities are kept only at the Federal Reserve Bank of New York and at the entities domiciled in the places like Bermuda or Cayman Islands.
And this is the primary reason for all the anxiety "Howe vs BIS" generates among the powers that be.
The ultimate test of our national will to return to honest money swings on the very same pivot as the ultimate argument in "Howe vs BIS".
The myth that fiat money could not be abolished without destroying the money supply itself operated as a giant uniform excuse for everyone. As long as that myth stood unchallenged, every Regular Joe and Plain Jane could say: I am very much for honest money, but, unhappily, it is too late for it now. Destruction of the money supply would cause more problems than honest money would solve. The time to resist fiat money was before Christmas 1913. Now we are stuck with it.
But when an orderly argument rejects this fallacy, Joe's and Jane's excuse for inaction is lost. Because the return to honest money can be executed by a willing President and Congress without coming anywhere near the calamities advertised by the fiat money racket, every Regular Joe and Plain Jane now faces the question: Why am I doing nothing to elect honest money President and honest money Congress?
What is it that keeps me in my mummified state of inaction?
This simple question will in time compel millions of Joes and Janes to stand up and be counted when Ron Paul or someone of his stature will accept the invitation to lead us back to the promised land.
EURO AND GOLD PRICE MANIPULATION, published in December 2000,
www.gold-eagle.com/editorials_00/tlaga121100.html contains the following challenge:
All Nobel laureates in economics now living, including specifically Professor Robert Mundell, are hereby challenged to come up with a rational argument against this presentation. Nothing would please me more than to be proven wrong. But if the best of the best will not come forward and prove that I am wrong, then something will have to be done about it. And that something can only be the return to honest money...
I hereby extend this challenge to THE ALTERNATIVE FUTURE.
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Greetings!
J.N. Tlaga
PS: My e-mail box is closed because it has been flooded with variety of messages containing undisclosed software
attachments. Also, countless mischief messages were being sent all over the world with my return address.
February 9, 2002
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