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Michael Rowbotham is the author of THE GRIP OF DEATH A study of modern money, debt slavery and destructive economics.

Below are excerpts from Goodbye America! Globalisation, debt and the dollar empire also by Michael Rowbotham.


The lost debate

At the time of the depression, critics of the monetary system claimed that an economy based upon banking found itself in a position of perpetual instability. It was inherently vulnerable to slumps and booms, driven or depressed by the rate of borrowing. It would surge, then crash as businesses and consumer confidence waxed and waned, and as banks’ lending policy altered. However, the monetary reformers’ arguments went far deeper than the issue of ‘boom-slump-boom’. Monetary reformers mounted a wholesale attack on the adequacy of the financial system.

The most provocative and hotly contested claim by monetary reformers was that, with the use of bank credit as the dominant form of money, the economy was not self-liquidating. In other words, the economy suffered from a recurrent ‘lack of effective demand’ and was unable to sell all the goods it was capable of producing.

This was clearly a radical and disturbing concept. For an economy to be capable of producing goods and services, yet incapable of selling them to its consumers, would indeed be a bizarre circumstance. The monetary reformers pointed to the ‘poverty amidst plenty’ of the depression, when food was left to rot in the fields or burnt as fuel, whilst people starved and industry collapsed for want of sales to a population with no way to express its ‘real demand’ for the abundant goods and services of their own economy. The lack of effective demand, or ‘lack of purchasing power’, from which the economy suffered was blatant for all to see. But the criticism of monetary reformers went yet further. They argued that even outside a recession, when the economy did appear to be functioning properly, this was only because of perpetual investment and growth. There was still an underlying ‘lack of effective demand’ from the established economy. This was only being compensated for by growth, since the investment injected essential fresh bank credit into the economy.

The underlying ‘lack of effective demand’ made the economy reliant upon this constant investment. Economic stability was impossible. Simply to continue functioning, the economy had become dependent upon constant development, constant borrowing, and constant growth involving the speculative production of additional goods. This pursuit of economic change was directed neither by genuine demand nor sensible purpose.

People were caught up in this pattern of growth, ever more firmly tied to fulltime wage-earning by debt and lack of purchasing power. Those displaced from employment by new technology would find themselves recycled into new jobs, producing new goods which were not necessarily needed or wanted, but for which markets would have to be created. An age of perpetual growth, speculative production and reliance of the economy on ‘marketing strategies’ was prophesied. Work, employment and production were becoming an end in themselves, justified by little more than being a route for distributing incomes to a population increasingly wage-dependent as their debt grew.

The lack of effective demand and pointless over-production forced nations to search for overseas markets, both as outlets for their unsold goods, and in pursuit of revenues to bolster their illiquid economies. Since all nations were under such pressure, they became locked into an impossible and irreconcilable economic conflict - export warfare - where each nation attempted to become a net exporter. But since for every net exporter there must be a net importer, in aggregate, nations were searching for markets that didn’t exist.

It was further argued that a bank-based money supply had a dramatic impact on government revenue and the nature of taxation. The perpetual scarcity of money in a debt economy let to a shortfall of taxation revenues and annual government borrowing. Meanwhile, the cumulative backlog of an interest-bearing national debt resulted in taxation becoming ever more predatory and oppressive.

There were micro-economic effects too. Monetary shortage not only drove people and businesses further into debt, but this gave a pronounced advantage to cheap, low-cost products. Thus, the financial system was accused of being responsible for the many ‘jerry-built’ products of the inter-war depression years.

So unbalanced was the financial system that banking - which ought to reflect economic activity rather than dominate it - had actually become a focus of policy, exerting growing centralized control over both the economy and individuals. Ultimately, this was because banks administered the debt bondage in which all were held, and banks were the source of fresh debt upon which the economy was becoming increasingly dependent.

In summary, the monetary reformers claimed that the monetary economy had come to dominate and distort the real, productive economy. Conflicts, pressures and a cycle of development were being fostered by a financial system that did not reflect reality. Banking had secured a ‘monopoly of credit creation’ and government, by refusing to create and circulate a sufficient medium of exchange free from debt, was neglecting its primary fiscal responsibility. Governments had thereby abandoned their peoples to perpetual economic slavery in a dysfunctional, out-of-control economy.

From these assertions, it is clear that this was not just an economic critique, but a highly charged socio-political debate. The significance of these arguments is further emphasized when they are placed in a broader historical context.

The drive behind globalisation

As discussed in the opening chapter, the dominance of the international market and the recent upsurge in international trade is seen as one of the most damaging features of globalisation. Of curse, it is not trade per se that is the focus of concern, but that involving
(a) the international exchange of near-identical products, and
(b) the importing of goods and services that could be produced locally.

As a related, geographical example, why is it profitable to grow vegetables in the southern hemisphere and air-lift them to Europe? This is a vastly inefficient use of resources. Apart from the gross wastage of the transport involved, the misuse of land is glaringly apparent. Land desperately needed in southern Africa to feed indigenous populations is directed to producing foodstuffs for export, whilst in Europe 10% of land is currently out of production under set-aside and Europe’s farmers are struggling to survive.

Under-consumption does not mean that consumers are buying too little, but that they are unable to buy all of the goods that their economy is producing.

Extensive marketing and globalisation

Overproduction, under-consumption and intense competition for scarce consumer purchasing power all have a critical effect on commerce, particularly on marketing. These factors constitute the main drive behind globalisation by creating an ubiquitous pressure towards extensive marketing. This involves the use of transport as a competitive strategy - a device for securing adequate sales in a cut-throat market.

This is most easily outlined as the international level. If an economy suffers from a lack of effective demand, and difficulty in selling the goods and services it produces, the obvious solution is to try to sell some of its products to another economy - i.e. to export. Another economy offers an increased customer base and additional consumer purchasing power.

Of course, this instantly creates a problem. Commerce attempting to export in search of additional sales will come into conflict with domestic commerce in another country. That nation’s domestic commerce, already suffering from the lack of purchasing power within its own economy, will find its sales reduced by foreign goods. Commerce in that nation will have to respond, and one of the strategies it will use will be to attempt to find its own export outlets. But if all economies suffer from debt and under-consumption, and their commerce is seeking overseas sales, commerce is still, in aggregate, seeking sales that do not exist.

This analysis explains two phenomena. First, the conflict that is all too evident in the constant effort to ‘capture’ foreign markets whilst ‘defending’ domestic markets in a global economy dominated by surpluses and inadequate sales. Second, it explains the cross-border exchange of near-identical goods and services, since to the extent that each firm is successful in its export drive, this will inevitably lead to an exchange of customers.

This pressure to export is more accurately described, not in terms of international trade, but in geographical terms, since the export imperative also operates within a national economy. Globalisation is an extension into the international domain of trends that have dominated domestic economies for many years - released by the free trade ethic that has progressively removed protectionist barriers.

The intense competition for sales in a debt economy places pressure on firms to supply goods and services to a wide geographical area, since this will offer them a wide potential customer base. If a firm initially serves a local market, the lack of purchasing power within the local area will pressure it to seek a wider regional market. If a firm has a regional market, there is pressure it to seek the additional purchasing power of a national market. If a firm cannot obtain sufficient sales from within its national market, it will be obliged to seek a foreign market for its products. Firms in all localities, regions and nations are under the same pressure - driven by the lack of effective demand within their existing market range, and in response to invasion by competitor firms from further afield.

This offers us a powerful explanation for the intense conflict over trade in the world as a whole and the trend towards the increasing ’overlap’ of markets. With all firms using transport as a competitive device to seek further markets, the final result is a thin spread of national or international supply by firms, with massive transport costs incurred and shared, and near-identical goods from many different manufacturing sources available in most areas.

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"Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters." Benjamin Franklin

I hope more people will read this thread and understand or watch Money as Debt.

Virtually all money that has been created since the start of the debt based money system came with the obligation to pay back with interest. Therefore, as the economy grew and more money was created, the obligation to pay back got even bigger and the money shortage grew. Now we are at the point that this system no longer works. In other words, the money shortage cannot be solved by creating more money that comes with the obligation to pay back with interest. Therefore, I am convinced that this money shortage will not be solved and we will go though a major deflationary depression.

However, the problem is the shortage of money, but not shortages of commodities or manufactured goods. Aside from the money shortage, the economy is physically capable of producing what we need. Therefore, in a sense, this problem is not real.
Read this. TRUST IN MONEY http://www.dailypaul.com/node/52961

The solution is to install a non-debt based money system.

Just my opinions.

government of the people, by the people, for the people

So, SIERRAHPBT, did you read this and understand?

"Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters." Benjamin Franklin

government of the people, by the people, for the people

SIERRAHPBT, did you read this and understand?

"Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters." Benjamin Franklin

government of the people, by the people, for the people

I think this is SO IMPORTANT for everyone to understand.

JohnGalt300, what do you think?

"first by inflation, then by deflation, the banks...will deprive the people of all property" -Thomas Jefferson

government of the people, by the people, for the people



"first by inflation, then by deflation, the banks...will deprive the people of all property" -Thomas Jefferson

government of the people, by the people, for the people


Just a note. It seems that some people, not only here but also elsewhere, seem quite busy trying to character assassinate Michael Rowbotham. I would think that international bankers would not want people to read his books. Also, it seems that some people started to show their true colors here at DP.

"first by inflation, then by deflation, the banks...will deprive the people of all property" -Thomas Jefferson

government of the people, by the people, for the people

Here is a hero in our midst

the revolution is sparkling: look at this:
The Day The Juniors Fight Back

Author: Jim Sinclair

Very important document below

Dear CIGAs,

I respectfully request that each member of the JSMineset community send this missive to the management of their precious and base metals junior investment company. Please follow up on it to be sure it has been reviewed.

Strength In Numbers

The junior producer and exploration and development companies need to consider the formation of a Chamber of Mines for this section of the industry.

This Chamber should be free of any individual company agenda, free of fees and other interferences with the singular intention of protecting our shareholders from being attacked by those in the shadowy part of finance.

There are close to 2000 companies in this part of the industry, many of which are experiencing the same extreme nuisances.

The naked gold short seller is an entity engaged in a criminal act with a goal of doing serious injury for the purpose of profit and is therefore a major target in terms of civil liability. The short and naked short pool operations are exactly the same but more apt to be a conspiracy to injure slightly then become subject to RICO statutes.

The job of this working Chamber of Mines as a singular unit is to pull these criminals out of the shadows into the light of day.

No matter how well they feel they are hidden there is always a paper trail going back to the perpetrator in this financial world.

Certain financial areas of secrecy in many cases do not protect the spoils of criminal activities. This may be proven soon at UBS where an officer is under arrest in the USA and is due to go to court shortly.

It does not mean anything that neither regulators nor exchanges care about the naked short or short selling pools, regardless of whether they are naked or not. If the stockholders and the company who’s values have been injured initiate civil proceedings, discovery will be full of legal opportunity. You cannot erase the paper trail that exists to every transaction.

My request is simple:

Contact the management of every junior precious metals producer, exploration and developer, asking them to contact Editor Dan at information@jsmineset.com so that the Chamber can take form.

There is no hidden agenda, no money to be collected, and no desire to stroke egos and no desire for private corporate information. I do not wish to be anything but a member. Let the organization elect its officers so we can act as one. We can speak as one. We can win as one, but we are weak when scattered as the industry is now. Organize and we are a legion. Expose the perpetrators and then it is all over. The data is there. It can be organized and it can be dissected, yielding the evidence trail of those who wish to hurt, sometime simply because they are mean, sometimes for illicit profits.

Add to that that sociopaths mistreat their associates and employees by nature. No looking may be required. It might just happen to come over the transom, even though we do not invite that.

You stockholders must push your management hard. Personally there is nothing that I will NOT do in order to protect both my and my investors’ interests.

I herewith dedicate my life, my fortune and all that I am to the identification of the perpetrators and their conduits used. Those sociopaths that take joy by inflicting severe injury for profit by conspiracy and the use of dirty tricks must be the hunted of nearly 2000 company’s determined managements and their more than 500,000 very angry stockholders.

There is only one way to defend stockholders, which is through the organization and strategy of a major offensive. Forget attorneys at this point. Regulators are of no help. A Chamber of Mines acting together can prevail.

I will even if I must go it alone.

Together we are legion. Alone and looking the other way you are a victim. I have never been a victim. No one depending on me will be a victim.

There is NOTHING I will not do to protect those that depend on me. I am livid. Enough is enough.

We will add risk to the bad guys. That proposition you and they can depend on.

Your friend,
Jim Sinclair

GREED you cannot be a Ron Paul supporter.

Your "hero" is a statist -- pure and simple.

From the Prosperity UK website -- a partial summary of his speech at the House of Lords:


He tabled a battery of ideas to challenge the entire neo-classical construct:

1. Government Creation and Supply of Money as a Primary Public Service (A public service?)

2. Restriction of Private Banking Mechanism (Communist?)

3. A Basic Income for all Citizens (Not the role of government)

4. Total Security of Home Ownership (Not the role of government)

5. Taxation should be Progressive and Income-Based
Do not tax people on what they do not have. Taxation has two purposes: revenue-raising and socio-economic objectives. -- (LOVE that one!)

6. Public Services held in Public Ownership
The priority is to serve the public. (I say SCRAP public services)

7. Private Commercial/Agricultural Enterprises viewed as Elements of Cultural Inheritance (makes way for "Cultural Inheritance" laws for farmers)

8. Institute Mechanisms to Maximise Citizens' Access to Cultural Inheritance; Products and Assets (Distribution of Wealth -- no, he's not socialist)

9. Government to Promote a Just and Sustainable National, Regional and Local Economic Policy (not the role of government -- what is a "just" economic policy, stealing from the "rich" and giving to the "poor"?)

10. Government to Promote a Just and Sustainable Food and Agricultural Policy (not the role of government -- what is a "just" food and agriculture" policy?)

Your "mate" is even quoted in the book, "Reinventing Democratic Socialism" -- Google it.

You can have your statist/socialist guru -- I'll stick with Ron Paul and Ludwig von Mises.


Lisa C.

“Elections are short term efforts; revolutions are long term projects.”

--Ron Paul

Join the rEVOLution here: http://www.campaignforliberty.com/

Ron Paul "Sign Wave Across the USA" -- November 5th!

all I can say

all I can say is.........mental masturbation!

Thank you

You took the words/type right out of my mouth/finger tips.

It makes a lot of sense.

www.dvds4delegates.com the newest and possibly the greatest weapon the Revolution now possesses.

Now if we can turn this country, and all countries around. Keep up the great work. That was a long one!!

Those who expect to reap the blessings of freedom must. like men, undergo the fatigue of supporting it.-Thomas Paine

The R3volution requires action, not observation!!!!


Thank you. You too!

In my opinion, if people understood this, we should realize that the rich dad as in the book rich dad poor dad is still in the rat race if you see the big picture. This is why it is so important to abolish the Federal Reserve and the debt based money system, in my opinion. End the slavery!

"first by inflation, then by deflation, the banks...will deprive the people of all property" -Thomas Jefferson

government of the people, by the people, for the people



"first by inflation, then by deflation, the banks...will deprive the people of all property" -Thomas Jefferson

government of the people, by the people, for the people