This article elegantly captures the idea of real wealth trumping the fictitious derivative value created by the banks. It’s the banks who have to be put through bankruptcy not the real economy. But who would administrate such a procedure? The sovereign power, the state as an expression of popular sovereignty , alone can accomplish this. The state is also  a priority creditor in this process having channeled immense wealth, publicly owned wealth, into the hands of the banks- wealth that has to be recovered. Only the state can create the kind of public credit system we need. It is not for nothing that the financiers see sovereignty as anathema and seek to reduce the state to a private institution, a mere tool of oligarchy. The crisis, then , takes the form of the affirmation of sovereignty versus the negation of sovereignty. Unfortunately, in the anglo-saxon world , at least, the anathema against sovereignty is shared by the oligarchy and its critics: both oppose “intrusive government”. But we need government to “intrude” into the affairs of the banksters on our behalf.

I thought I heard something the other night. It was a distant sound, a low rumbling, a roar from some far off beast that had finally pronounced its presence. It woke me for a second, but it was so distant I felt no threat and simply rolled over and went back to sleep. The next morning I learned that Iceland was taking a stand. It was refusing to pay its British and Dutch debts. It is claiming the debts are a result of fraud, and it’s right. They have made the offer to pay some years from now, if they can afford it at that time, and only as a percentage of their GDP. This offer has been, of course, declined by Iceland’s creditor banks as they demand payment in the form of real assets.

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