Sept. 21, 2007 (LPAC)--Only six weeks ago, Bank of England governor Mervyn King had insisted that the BoE's making of a loan to a failing bank could "sow the seeds of a future financial crisis." And three weeks ago, when Barclay's Bank begged for a cash infusion from the BoE, King asserted that loans would only be given to borrowing institutions that could present "risk-free assets" as collateral. With that said, what is the significance of Mervyn King's recent $80 billion loan to a failing bank, the disaster known as "Northern Rock"? This policy-decision must be viewed from the standpoint of the collapse of the entire global financial system--a Weimar-stlye hyperinflationary reality King is surely well aware of.

Furthermore, King has already set-up liquidity channels of $20 billion to the commercial banks, through three-month loans. In this case, once again, all the banks have to provide to receive these loans are their worthless holdings of (certainly not 'risk-free') mortgage-paper. King also guaranteed future loans would follow, at weekly intervals! Don't forget the 7.25 billion-pound interbank lending from Sept. 17, either, for those of you who are counting!

So far, Lyndon LaRouche stands alone as one with enough courage to publicly identify the systemic nature of this crisis. Thus, the paltry excuse of the BoE governor for its hypocritical policies (to "alleviate the strains in longer-maturity money markets"), must be met with derision by patriots of the FDR tradition. Since LaRouche's solution to this collapse is also well-known by these very financial circles, the actions of fools like Mervyn King cannot be interpreted as simply kinematically-determined, as King and the financial press might like you to believe.