December 13, 2007 (LPAC)--While still afraid to admit that we are now in a hyperinflationary period comparable to 1923 in Weimar Germany, the press and commentators in Europe are compelled to acknowledge that yesterday's action by the central banks was a panicked opening of the currency floodgates. "Central banks open cash spigots," screamed the International Herald Tribune. The London Daily Telegraph characterized the arrangement as "a desperate attempt to ease the credit crisis," and quotes Ian Stannard, an economist at BNP Paribas: "This is a drastic action. The central banks want to place a fire-break to stop credit tensions spilling over into the broader markets and becoming the catalyst for a global economic crunch."

"Helicopters start dropping bundles of cash" was the headline in the Financial Times, over a Martin Wolf column which began: "The central bank helicopters are planning a co-ordinated drop of liquidity on troubled market waters. If this does not work, more will surely follow. The helicopters will fly again and again and again." Continuing he says "the central banks must be pretty worried to take such action," and they have to be hoping that their action will not trigger more panic, with people asking: "What do the central banks know that I do not?"

Columnist Wolf then asks, will it work? He concludes that if the problem is a lack of liquidity - i.e. panic - in the markets, then it might. But if the problem is insolvency - and, he says, there is good reason to believe that a good part of the stress is caused by fears of insolvency, and by the reality of threatened insolvency - then this is a different problem, which would require the central banks, and the Treasuries behind them, to buy up every piece of paper: good, bad, and indifferent. Of course, as Lyndon LaRouche has repeatedly stated, the entire financial system is insolvent, there is no solution short of putting it through a global bankruptcy reorganization.