Transcription
In order to implement any big society-wide change, and I think your COVID, uh, example is a perfect one, you really have to construct a crisis. And the change is a solution to whatever the problem you created is. So, like, if you, I don't know, want to create a new federal agency, you probably need a 9/11. If you want to make biometrics the rule, you probably have to push AI and make the case that, like, we don't know who anybody is because everything's a deep fake. So you have to have biometrics and, you know, in your Twitter handle, etc. What will be the crisis that justifies digital currency?
So let me step back for a second because what I see is the crisis is only the apex and the third act. To get the crisis working, you have to get thousands of things in place. So, for example, coming into COVID, I don't think you could have done COVID without, for example, getting Federal Accounting Standards Advisory Board Statement 56 into place in 2018 and then having the central bankers meet and approve the going direct.
Are you familiar with that? I will, I, I would be delighted to tell you about that because this is one of those things that sounds very boring that is like a, you know, a 10 Richter earthquake. So for many, many years, there was a group of us who were, uh, trying to bring as much transparency to the fact that there was serious criminality going on in the federal accounts and $21 trillion was missing. And that was happening because the federal government refused to obey the financial management law. So they are required, you're a citizen, you pay your taxes, they're required to give you, you know, you give them your 1040 and they're required to give you back and say, "Okay, here's how we spent your money." And that's required in the Constitution, the financial management laws. The federal government has, has since the mid-'90s been in complete violation of those laws. So there was a lot of pressure that was brought to bear when Dr. Mark Skidmore with Ceri published his report on the $21 trillion missing. And so pressure, pressure, pressure. The DoD keeps saying, you know, "We can't pass an audit. We're not going to pass an audit." And then 2018, remember the Kavanaugh hearings?
Very well. Okay. Everybody was very busy, you know, watching the Kavanaugh hearings. The federal government, the House, the Senate, and the White House altogether, October 2018, published an administrative policy called FASAB 56 that basically said, in violation of the Constitution, the financial management laws, and the financial management regulations, that they could set up a secret group of people by a secret process and pull things out of the government's financial statements and keep them secret, not just for the 24 covered agencies, but for 150-plus related governmental entities. And when you take in the national security and classification laws, that means also that the big banks and contractors working for the federal government can do the same.
Right, that's delightful. And JP Morgan too. Right. And what that means is, basically, the entire large-cap stock and bond market in the United States is secret. The disclosure is meaningless. It doesn't mean anything. And if you, and if you go to Soleri, we have a missing money section, and we have extensive, not only descriptions of FASAB 56, but what it means to investors.
On what grounds could the federal government declare private businesses, the whole of itself, all kind of off-limits to disclosure? They have no legal basis because this is in violation of the Constitution, the financial management laws, and the financial management regulations. We have a section at Missing Money with seven briefing papers. It took me two years working with our attorneys to do it that describe all the financial management laws of the United States so that you can see. And luckily, one of the interesting things that happened when FASAB 56 passed, Matt Taibbi picked up on it and wrote an article about it. And he, it's funny, he emailed me. He said, "Okay, I got the briefing papers. Thank God." Because it's very, you know, if you're someone like Matt Taibbi, it's very hard to sit down and learn the financial management laws of the United States. That's why we did the briefing papers so that any reporter could, you know, get into this and master it in a reasonable period of time.
Was this a or just a regulation? Was this is voted on?
This is administrative policy. So in administrative, in law, there's the Constitution, there's the financial management laws, there's a regulation, and then there's the administrative policy. So this is the total inversion. This is an administrative policy saying we can break the Constitution, the financial management laws, and the regulations by administrative policy. But the House, the Senate, and the White House all agreed. So it was a joint, and they tried to sneak it through. And I was very lucky because, um, there was a guy at the time who worked for the American Federation of Scientists that literally read the Federal Register. And I had signed up for his newsletter because I didn't want to, but I trusted him to do it. And he would keep an eye on the black budget issues of a guy named Steve Aftergood. Very good. And, and he, in his newsletter, he read it and he understood what it meant because it's so boring, nobody would understand.
That's exactly right. Right.
What's not boring, and I just, I'm sorry to keep interrupting you, but I, I don't want anything to fall through the cracks. The black budget issues. What black budget? What is the black budget and what was he looking at and why should we care?
So, so we have an overt economy. We have a covert economy. The covert economy is driven by a series of pools of money and cash flows. The first one, um, uh, Joseph Farrell calls it the hidden system of finance. The first one started with all the seizures during the wars. So during World War II, a great amount of assets were seized, and that created a pool of money that was available for covert operations. So there's a wonderful story in Christopher Simpson's first book about how the money they had seized had been moved into the Exchange Stabilization Fund, which is the mother of all slush funds, that's managed by the Secretary of Treasury, managed by the New York Fed for the Secretary of Treasury. So the money had been moved in, and the Dulles brothers are sitting at Sullivan and Cromwell and they use that money to rig the '48 elections in, uh, in Europe at the request of the Vatican. Anyway, so, so, so, so this is the, you know, so we have these, this seizure pool. Then what happened, uh, we passed the National Security Act in '47, and then in '49, we passed the CIA Act, which was very fractious. It literally took assassinating Forrestal to get that done.
And who was thrown out of a window?
Yeah. Yeah. So that's.
Bethesda Naval Hospital. Right?
He'd been the Secretary of War.
And he was very opposed to the creation of the black budget and the creation of Israel. And so.
Who killed him? And why don't people understand that the defense secretary, Secretary of War, was was murdered?
So.
I don't think one in 100 people know that.
So we, you know, he was a Dillon, Read partner. So I knew that because I used to stare at his painting in the partner's boardroom or dining room. And they would, you know, they would always train you by telling you if you're not careful in Washington. This.
It's funny. There are two books that I, I have read on it. Both of which cost like a hundred bucks a piece on eBay because they're, it's just.
Have you read David Martin's book?
I don't know. I have two. They're in my office. I read them both.
You want to read Dave Martin? We have a great interview with Dave Martin. And let me finish.
Both were written in the '60s. But really quickly, do I mean, his murder. His murder was part of a deal to get the '49 act passed, is my theory.
Okay.
And, um, and that, and to create the creation of Israel. So it was both the black budget and Israel that were, and they needed to get him out of the way. So, um, we have a big interview on it, and I've looked very into it very deeply. I was very interested in Farrell. Anyway, so the, but the '49 act was the CIA Act. So you have the National Security Act '47, the CIA Act. What the CIA Act authorized was the ability to appropriate money to different agencies and then claw it back secretly to a black budget. So now we have the hidden system of finance with the pools of seized money, and we add to that a layer of money that can be appropriated and clawed and used secretly, only subject to very limited oversight by a se, a committee in Congress. So, so the appropriations committees wouldn't see that money, only this one committee that oversaw the black budget. Okay. And, and if you look at those two pools, the next step happened in '81 when Bush comes in. Bush comes in as vice president under Reagan, and his deal with the Reagan folks during the campaign was he'll, because he'd run the CIA, he'll run intelligence and enforcement. And the Bushies were very, very good at the nuts and bolts of, of sort of the mechanics of government and the legal system and money. He got an executive order done that said, essentially, you can use this secret money, the black budget money, and you can use it to hire corporate contractors who can now do highly classified projects. Now, let me explain what this means as a financial matter. So, we were talking about the stock market going up. You can now take the most secret, powerful technology in the world and pay corporations to learn and end up owning that technology secretly in a way that drives their stock to the moon. So now you've connected the US Treasury market directly, like a pipe, into companies and drive their stock up almost to an infinite amount. It's quite, as a financial mechanism, it's one of the most powerful things that ever happened in our history.
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