DR. JONATHAN TENNENBAUM - Scientific Advisor to the Schiller Institute and the Executive Intelligence Review (EIR), Wiesbaden, Germany.
Dr. Tennenbaum opened the conference with a detailed history of the US economy from the 1930s forward. He described a major shift in the US economy when, in 1971, the United States abandoned the post war Bretton Woods agreement linking the dollar to gold and other direct measures of real productivity. Incorporating the"artificially manufactured" oil crisis of 1973, floating-rate currency accords in the 70s and financial deregulation of the 70s and 80s, he described in precise detail how the US has systematically destroyed its own manufacturing base.

In discussing the current US economic bubble Tennenbaum revealed that that the US financial"derivatives" market has a volume of $300 trillion dollars. [Derivatives are any financial instrument or commodity derived from a real source of wealth such as stocks, land or gold. For example, a gold"future" is a derivative. Stock options and margins are derivatives.] Derivatives have no connection to real productivity or value. The price of gold has been suppressed to disguise inflationary pressures and speculation in leveraged gold nearly destroyed the world economy in 1998. [see FTW, 9/00] This resulted in the exposure to public view of the so-called Plunge Protection Team in the US, consisting of the Treasury Secretary, the Fed Chairman and the former head of Goldman Sachs, Robert Rubin. At this point it became apparent that US markets are no longer operating under free market principles of performance and fairness. US markets are rigged and controlled at the expense of other nations and/or of small and medium sized US investors.

Like everyone who spoke at the conference, Tennenbaum agreed that a major global crisis is imminent."This is not simply a U.S. crisis, but rather a chaotic collapse of the entire postwar economic and monetary order. There is no way the system can survive in its present form. It is totally rotten, and any attempts to make"adjustments" will only make the situation worse."

DR. MIKHAIL KHAZIN - Director of Business Development, CBT Consulting.
Khazin, an economist, has previously worked in various Russian government positions in the Yeltsin Administration. His 2000 article entitled"The Crash of 2000" has been frequently referenced in FTW. Khazin is also the author of a new Russian book entitled The Collapse of the Dollar. Khazin's refreshing analyses of the US economy continued as he discussed the disequilibrium between the so-called"New" computer economy and the"Old" manufacturing economy. He observed that, historically, new technologies were absorbed into larger economic spheres making the whole more productive. But, with the speculative nature of technology stocks, the newer technologies have become a distinct economy. This separate economy has not significantly contributed to the productivity of the whole. He observed that the over-capitalization of the dot com economy with its"virtual value" has expanded to the point of instability that now threatens everything.

Khazin predicts a"destruction of stereotypes." This will happen with the elimination of $7-15 trillion of stock market values, prompting massive bankruptcies of banks and financial institutions worldwide, followed by an outbreak of inflation. This will trigger a shift back to tangible value items such as precious metals and diamonds, which is already occurring. He predicts a total collapse of the World Trade Organization (WTO) and a return to nationalistic protectionist measures. Although Khazin predicts that the dollar will ultimately fail as a world currency he adds that the Euro will not take its place in the short term. His overall analysis and predictions were strikingly similar to the situation at the start of the Great Depression in 1929. Massive social unrest and dislocation will result from the collapse and no portion of the globe will be exempt as total world demand for goods and services contracts by 1.5 - 3 times over the course of the crisis. Of the three major regions, Europe was best prepared to survive the collapse but Asia and Japan would be particularly hard hit.

MR. GAVITSKY - Member of the State Policy Committee on Economics of the Duma.
Good money creates a good economy. Bad money creates a bad economy. The main worldwide fear around the dollar is that it is not legitimate. This at the same time that the world depends upon the dollar. The US behaves in the world without caring about other countries. There should be a world currency but no one can decide how to do it.

If something replaced the dollar as the world's leading reserve currency then all of the dollars would go home to the US. That would cause hyperinflation in the United States. Only Russia is capable of opposing US manipulation of world politics and economic forces. Russia should help create a legitimate world currency, a basket of currencies that benefits all nations. Since all crime is connected to cash, the solution to crime is to eliminate cash.

VLADIMIR ZHIRINOVSKY - leader of the Liberal Democratic Party (LDP), vice-speaker of the Russian Parliament (Duma).
Zhirinovsky is widely perceived as an ultra-nationalist. A charismatic speaker, he rarely elicits a neutral reaction. He is a lightning rod, capable of galvanizing popular sentiment though not generally regarded as a political threat to President Vladimir Putin. In his presentation entitled Financial Economic Drug Addiction he divided the world into a"Golden Billion" of rich nations, a"Third World" of traditional poor nations and a second world comprised of Russia and Eastern Europe. He likened"reserve currencies, especially the dollar, to a drug that the nations have become dependent upon."They will sell their territory, their people, anything to get their share of the dollar pie." He suggested alternatives like a Golden Yuan from China or a Golden Ruble as alternatives.

be



<center>

<HR>

</center>