In our society the term Conspiracy Theory brings out strong negative reaction in most. Visions of nutcases dance across most peoples mind, and several years ago I had the same reaction. That was until, feeling that there was something off in the economy, I started to do my own research. What I found was there were countless undisputed examples throughout American history that if brought up before and even for years after the fact would have been considered what we now call conspiracy theories. Here are a few examples that stuck out to me:
Prior to the United States entering World War One Great Briton’s supply line from the US were being devastated by German submarines, U-boats. The Germans attempted to only attack ships that were carrying munitions. There was a passenger liner, the Lusitania, which was supposed to set sail for the UK from New York. The German embassy fearing the passenger liner would steam into danger attempted to warn the American public away from traveling on the Lusitania by putting a notice in news papers. Many papers would not run the warning, though many did.
The ship did sail with many American passengers, and as warned by the German Embassy, was attacked and sunk by German U boats. This attack was touted as a breach of international law and rallied the American public to enter the war against the Germans. It was only considered a breach of international law because American and British officials claimed there were no war munitions on the vessel. If there were munitions on board the attack would have been a legitimate act of Germany defending itself. There are many other issues with the sinking of the Lusitania but I will allow you to do your own research, but one thing that cannot be disputed is that during a salvage operation there were thousands of rounds of ammunition found. That ammunition would have been used on the German Army if not for the sinking. There is no way that the US government was not aware of this ammunition and so they were complicit in lying to the American public to gain support in sending thousands of Americans to their death.
This next one may not be considered a conspiracy theory now, simply history, but if you would have told someone in 1928 what would happen a few years later they would have thought you were nuts. I am referring to the gold confiscation of 1933. From the origins of this country until the great depression gold coins had always been money and for much of that history the ultimate form of money. In 1928 near the peak of a credit created boom, the thought that it would be necessary, or legal, for the government to take gold coin and bullion from all American citizens would have been met with great skepticism. That said for one paying attention to the cracks forming in the financial system it would not have been beyond the realm of reason. The average banker, trader, economist or financial journalist of the late 1920’s could not be depended on for giving proper investment guidance leading up the the great depression and eventual gold confiscation. On the other hand what would now be termed an economic conspiracy theorist would likely have given better advice.
Finally a perfect example of entities ignoring economic signs and the ranting of a ‘conspiracy theorist’. In this instance the entities are entire nations instead of individuals and it was the leader of France that was reading the tea leaves. Charles de Gaulle the president of France warned the world that the United States would not be able to fulfill its obligations agreed to under the Bretton Woods System and redeem US dollars for gold. France and a few other countries acted on these fears and began to redeem their dollars for gold. As a result of American officials placating fears with assertions that dollars were as good as gold, many nations, probably against their best judgment, did not get their hands on as much gold as possible prior to the slamming of the gold window.
I chose three examples that are simply parts of our American history but at one point would have been thought of as impossible. They also would have fit our current definition as a conspiracy theory. The truth in each of these cases was put forth to the public in different forms, from various sources, and was also denied by the highest levels in government. Simple steps could have been taken in each case that would have prevented heartache or worse to those that heeded the warnings of “conspiracy theories”. The steps that could have been taken include not traveling on an ocean liner, removing your gold from safe deposit boxes, and central banks redeeming dollars for gold. In retrospect these actions were obvious, but certainly wouldn’t have been if you were taking your advice from the US government.
We should not allow making educated guesses on future events overwhelm us nor should we become overly committed to a theory that is not supported by events as they happen. That said using current events, all available information, as well as history as a guide to make educated guesses on the path of the economy and government action in the future is a sound strategy. I will certainly make every attempt to do so and I hope you do the same. I also hope you continue to read and my tests my theories with the events of the future.
Let’s take back the term Conspiracy Theory and use it as a technique to best deal with a very uncertain economic future, at least until we can believe what is being presented to us from the government and financial media. We may be waiting a while.
Confused? Please read my first post History and Introduction.