First of all - the preamble. Our version of the economic theory of capitalism — neoconomy — suggests that the mechanism of development under capitalism is a deepening division of labor. There is a deepening - there is a development, there is no deepening - a crisis begins. But the deepening of the division of labor leads to an increase in producer risks (roughly speaking, it must be integrated into an increasingly complex technological chain and an increasingly competitive environment). And thus, the institutional problems of capitalism are the creation of institutions that reduce the risks of the producer.
If you look at history capitalism, there were two main instruments for risk reduction: the expansion of markets (markets and / or markets for the acquisition of resources, which made it possible to reduce the cost of production within the old system) and the redistribution of risks. The banking system acted as the main instrument of the latter, which took upon itself part of the manufacturer’s risks.
We hear a lot of talk about the parasitism of the banking system, which, in the words of Yeltsin, "takes on too much, doing little." And it is true. But let's face it: the interest rate of a bank loan is not only the margin of the banker, it includes (often significantly higher) risk pay. Actually, the ideal banking system could be in the USSR, where (theoretically) it would be possible to calculate the exact risks of the manufacturer (and they always exist, since no one has canceled any wrong technical solutions, nor natural disasters, nor man-made disasters, etc.) the exact amount of risk payment throughout the economy. Excluding, respectively, the banking profit, which under socialism was not needed. And this percentage would not be zero!
So, returning to capitalism, it can be noted that by the end of the XIX century, both existing methods of risk reduction had been exhausted. The world was divided between the colonial empires, and the banking system faced a crisis. Under the conditions of growing competition, manufacturers demanded lower rates, and banks, taking into account growing risks, needed to increase it. It is for this reason, by the way, that monopoly industry empires began to grow during this period as a way of protecting industries from the economic crisis. And this, in turn, led to the development of antimonopoly legislation in the early twentieth century.
In the case of banks, the development of these processes led either to an increase in non-returns (if the rates were insufficient), or to the fact that the money stopped working because no one took them at high rates. One should not underestimate the competition between banks, which at that time were independent commercial structures.
As a result, liquidity declined throughout the banking system as a whole, and banks began to compensate for it by increasing interbank lending, that is, redistributing risks throughout the banking system. In the end, the level of risk throughout the entire banking system became transcendental and a classic crisis of interbank lending occurred, which we are well aware of, for example, in the 1995 year. It happened in 1907 year.
This was followed by the economic crisis (the first crisis in the fall in capital efficiency), to overcome which it was necessary to restore the liquidity of the banks (so that they could continue to take the risks of producers). To do this, J. P. Morgan (senior) made a netting within the banking system and, adding his own money, restored the liquidity of the entire financial system. And then at a secret meeting of bankers and politicians on Jekyll Island in November 1910, it was decided that such an operation (that is, refinancing of the banking system) should be systematic and institutionalized.
At the same time, all participants in the meeting were aware that the creation of such an institution (which materialized the words of one of the first Rothschilds: “Give me the right to issue money in the state, and I will not give a damn about who rules in it!”) . Details of this operation can be read, for example, in Sergey Egishyants’s book “Deadlocks of Globalization: the Triumph of Progress or the Games of Satanists?”, I can only point out one important fact.
If the creation of the Fed would be only the operation of bankers and financiers to reconfigure the world (and American) economy in their favor - maybe they would have failed. Neither keep the idea secret, nor implement it in practice. But apart from this layer there was another objectively necessary: in order for the banking system to continue to perform its economic functions, it was necessary to build it on with the following element, the role of which today's hero of the day, the US Federal Reserve System, played.
I will not talk today about the role that the Fed has played to strengthen the position of the global financial elite. I note only two circumstances. The Fed's resources were enough to maintain the situation until the beginning of the 30-s, and then a new crisis of the fall in capital efficiency began. It was “driven” by the deflationary scenario, which allowed the financial sector to redistribute a significant part of national wealth to its own benefit: when there was not enough money in the economy for anyone except for the “especially close” to the Fed, it was these latter who could spend this money on purchase of the most valuable assets.
At the same time, inflation problems did not arise - the Fed could always use excess money throughout the entire economy using monetary policy instruments. It is this formally legal (not all available) tool became the main source of redistribution of profits in the economy in favor of the financial sector, allowing it to increase its share of profits in the economy from 5 – 8% (up to World War II) to today’s than 50%. And it is clear that no economy can normally exist when the intermediary, in essence, the sector begins to redistribute more than 50% of value added in its favor.
I will go further in less detail, anyone can find these details in my texts on the site worldcrisis.ru. But I note that the crisis in the fall in the efficiency of 30's capital ended with the expansion of markets for the division of labor systems (technological zones) that won this war, that is, Western (American) and Soviet. And the next crisis in the fall in capital efficiency began in the US in the 70s (you can even accurately name the day - August 15 1971, when the United States declared the second default in the twentieth century). And America came out of it by inventing a new mechanism for reducing the risks of producers, in a sense, by falsifying the expansion of markets. Namely: they began rampant consumer lending. That, of course, increased the sales markets, made it possible to launch the next technological wave (to implement the next “technological order” in the terminology of S. Glazyev), destroy the USSR and make the last real expansion of the markets (the “golden age” of Clinton).
But what's next? Expansion of markets is no longer possible, central banks have exhausted their ability to stimulate the banking system (interest rates and reserves at absolute minimum), and the efficiency of emissions to maintain the real sector is minimal. At that moment, the world financial elite had an idea that it was possible to repeat the “focus” of a century ago and make another superstructure, just not above banks, but above central banks. That is, to make (on the basis of the IMF) a “central bank of central banks” as a tool for reducing risks. Everything would be fine, but, unlike the times of J.P. Morgan, all this was done openly - and as a result, the US bureaucracy closed this attempt through the “Strauss-Kahn case”.
Thus, the entire scheme of financial risk reduction of the manufacturer, which was an objective economic basic existence of the Fed (in which the latter acted either as a final authority or an important intermediate mechanism), came to an end. The question of how much the Fed will exist after its centenary, is open, but we can safely say that the times when this organization was at the top of its power have passed. And this role will be reduced faster and faster. Already in the world - so sure.