Institute of Noetic Sciences: Well, it’s just about 5 o'clock. Welcome to everyone who is joining us tonight, and happy New Year! I’m Angela Murphy; I’m the program director for the Shift in Action program, and I welcome you to this week’s teleseminar. We’re very excited to have Catherine Austin Fitts as our guest, with our host Matthew Gilbert. They will dialogue for approximately 40 minutes, and then we will open the lines for your questions for about 20 minutes, and then we’ll have time for Community dialogue for approximately one hour after the interview. You don’t need to mutes your phones at this time because I will put it into presenter mode. So, thank you for joining us, and here’s Matthew.
Matthew Gilbert: Thanks, Angela. And I, too, welcome you to 2007. I think it’s fitting (so to speak) to have, as our first guest of the year, Catherine Austin Fitts. As some of you may have read on the website, Catherine offers a unique perspective on the global financial system and the power of people to overcome that system. This is especially critical as we commit ourselves in this New Year and beyond to positive personal and collective change. With an MBA from Wharton School at the University of Pennsylvania, Catherine’s insider background includes: Managing Director of a major Wall Street financial services firm; Assistant Secretary of Housing at HUD (that’s the U.S. Department of Housing and Urban Development), and President/Founder of Hamilton Securities Investment Bank. She is currently president of Solari, Inc., a very different kind of financial advisory company, founded on the vision that changing how our money works will create true wealth and ultimately transform our world—a transformation that begins with each one of us. So, welcome to the show, Catherine.
Catherine Austin Fitts: Matthew, hi; it’s great to be on.
MG: Catherine, your depth of insight into how the economic game is played is considerable. Before we get to the more transformational opportunities that are in front of us, I’d like to start by asking you to briefly explain those dynamics and how this current economic model is built around what you call “the Tapeworm Economy.”
CAF: When I left the Bush administration, I said, “Oh no, (what I now call) the pro-centralization team is going to kill us all!,” and I felt there was an urgency to understand how we can transform things. We started a company and built an extraordinary amount of databases on the economy, did about 12 billion dollars of transactions for prototyping how you could shift things, and what we discovered was that the First World economy has what I call a “negative return on investment”—which means…. Let’s say if we were invested in stock, and every year the price of stock went down, we would have to put more money into our investment to keep it pumped up. It kind of operates like that.
MG: A certain artificial quality to it, you’re saying.
CAF: Yeah—and a great deal of the economy has centralized into the financial mechanisms run by the central banks and treasuries, particularly in the United States—and so much of economy, whether seemingly private or public, is pumped up by that mechanism. And I was at a natural healing center one day, and this wonderful woman, who just knows everything about natural healing, was explaining to me how a tapeworm operates. And I said, “Wow, that’s what I mean by negative return on investment economy!” The way a tapeworm operates in your body is it injects in you a chemical that makes you crave what’s good for the tapeworm and bad for you—so the tapeworm engorges and gets richer and richer, or fatter and fatter, while you diminish. There’s the same sort of negative return on investment cycle that’s happening with us, and so I started to call this mechanism, and the people in it, the Tapeworm—because it seemed a much more fitting description of it (and certainly much more entertaining) than “negative return on investment.” But everybody knows that, when you have a tapeworm, what you need to do is flush it. [laughs] And so it just seemed a very appropriate metaphor for what was happening.
MG: Explain a couple things about the actual dynamics of the Tapeworm, without getting into too much deep financial jargon. How does it work in the systems that currently, more or less, run the show?
CAF: There are a couple of important things to understand about the Tapeworm. One is it’s looking to centralize economic and political power, and much of that it does through banks and corporations, which it grows larger and larger and larger. So, for people who don’t want to spend a lot of time understanding how the Tapeworm operates, one very good rule of thumb is to just say, “Well, if it’s big and rich it must be Tapeworm.” The second thing is that it has an overt part and a covert part—so it’s a little bit like if you’ve ever been to Disneyworld (which I never have, but a friend of mine took a management course) and you go underground at Disneyworld and see how the whole thing is engineered.
MG: The man behind the curtain?
CAF: Right, the man behind the curtain. And so it’s very hard to understand. You know, our world is taking on an increasingly Orwellian, Disney feeling to it, because everything in the overworld is engineered from the underworld, or the covert world—but it’s very hard, unless you understand the economics and track the cash flows, to see it. For example, I once went through a period where I’d drive from Tennessee to Philadelphia and Washington once a month, and I started to focus on one franchise operation, and I would drive by this particular franchise entity maybe 20 or 25 times on the way up and back every month for several years. And what I noticed is it didn’t matter whether it was day or night, weekend, or whatever—the place was always empty. In fact there was only one of the twenty-five that it really had a going business. And this went on for years, and finally…. You know, I’ve written in “Narco Dollars For Beginners” about money laundering and how it operates—but finally what I realized is this particular enterprise clearly could only be explained by money laundering and pump-and-dump stock market fraud. And so you can imagine, if you are an honest restaurant trying to survive, competing with someone who doesn’t even have to cover their overhead. It has important implications. So part of seeing the Tapeworm is understanding the relationship between covert and overt, and the cash flows that go back and forth.
MG: So, when you speak of money laundering and pump-and-dump, say just a little bit about that. Money laundering to me sounds likes dark coats and things that go bump in the night.
CAF: No!; think of it this way. Once I was staying in Philadelphia with a wonderful dear friend of mine—I had the apartment in her little row house—and every weekend there were three kids selling drugs (I presume) on the corner. And we had one of these franchises about two blocks away, and so I sat down with a piece of paper, and we estimated what we could from their weekly sales, and I said, “Okay, let’s say I’m supplying them and I’m getting this percent. What my cut would be from three 12-14 year olds sitting on a corner at 54th and Sansome in Philadelphia?” And what we calculated was that we’d make $100,000 a year for just supplying them—and, if we could run it through this franchise, we could generate 2-4 million in stock market value, just on that franchise. It was a publicly traded stock.
MG: So you’re saying if the business was run professionally and normally, that that would generate more true wealth than what’s going on in the streets, which could be connected to this whole other network of nefarious systems?
CAF: Think of it as kind of a financial slavery/genocide. The stock market pop creates wealth for a relatively small group of people, along with a bunch of institutional investors—but that comes down to a relatively small part of the population. And then those 12-14 year olds are processed through a cycle of prison and sickness and death.
MG: Another notion that you bring up is the Popsicle Index.
CAF: Right. So, the Tapeworm system really eats up living capital, whether its people or environment or things, in a way that generates financial wealth. The Popsicle Index, as you know, is my rule-of-thumb for the health and well-being, or the living capital, in a place. The Popsicle Index is the percent of people in a place who believe a child can leave their home, go to the nearest place to buy a popsicle, and come home alone safely. So when I was a little girl in Philadelphia, the Popsicle Index was 100%: It was unthinkable that you couldn’t run up to Spruce Street and play some pins and come home, at any time day or night, alone. And while, in my lifetime, the Popsicle Index in my old neighborhood has gone from 100% to about 10%, the Dow Jones has gone from about 150 to over 12,500 (the last time I looked).
MG: Interesting correlation there.
CAF: Right. So, financial capital has gone up tremendously in a way that has been consolidated, in a way that has shrunk living capital. Now, hidden in those numbers, what’s hard to see is that financial capital for many people has been drained. So it’s not so simple that we’ve just created financial equity, because ultimately financial equity is a mirror of real things. So ultimately, if you destroy real things, where you’re headed in the long run is destruction of financial wealth. What we really doing is we’re consolidating in a way that shrinks total wealth, particularly living wealth, but financial wealth as well, certainly compared to what’s possible.
MG: You’re saying the total wealth that is available to greater numbers of people, or just wealth period?
CAF: We’re shrinking total wealth. And the proof is what you’re seeing in the environment.
MG: The degradation of the air, the disappearance of soil, and so on. That’s what you refer to as part of living equity?
CAF: Right. So, when people say that the Tapeworm makes money, to me it’s ultimately absurd, because when you destroy the source of wealth there is no wealth creation. Now there’s a paper gain that, as long as enough people recognize it, it’s really backed up with force. We’re watching the complete integration of military and economic warfare. So when the President or Vice President says, “We reserve the right to proactively drop nuclear bombs on you,” what I hear is, “If you don’t buy more treasury securities we’re going to drop bombs more nuclear bombs on you.”
MG: Our financial system is a house of cards.
CAF: Well, in fact, what they’re doing is dealing with what it takes to finance keeping this thing going. Remember: a negative return on investment system is not productive—a body with a tapeworm is not healthy—and so, as productivity decreases, you have to become more and more venal and forceful to extract the subsidy needed to keep going—which is why, as you read news, what you realize is the Tapeworm has to become more and more aggressive to get more subsidy to keep the game going.
MG: One of the arguments, obviously one of the more obvious motivations for some of our Middle East policies, is to continue to have access to oil. But what you seem to be saying is that, even more important than that, is that we need more access to potential markets. But what other people might argue is that the standard of living of those people (or at least some of them) arguably would be raised by such an intervention. Is this a false argument?
CAF: Well, there mixed results. Certainly in Iraq I’d say it’s a false argument. I’ll give you an example of where that argument works: If you study the history of Roman Empire, wherever the Romans went and conquered, they invested tremendously in infrastructure and bringing a much higher level of science, and engineered that place in general. Now what you’ve been watching in Eastern Europe and Russia in the ‘90s, and then in Iraq now, is something different—which is you take over a place and then you strip its infrastructure. So what you’re watching is much more…. You know, the Romans invested in improving the technology and material aspects of a place. Now people could argue both ways, whether or not that was healthy, because someone who values freedom first and foremost might have feelings about that. But we’re not investing in infrastructure; what we’re doing is simply shifting the ownership and the equity of assets to a variety of hands, so we’re consolidating assets. I’ll give you an example: We went into Russia in the early ‘90s—and this is a great example of economic warfare as it’s being practiced—there were an estimated 14 million people living in poverty in the former Soviet Republic. As we privatized, by the end of the decade, there were 147 million people living in poverty in the former Soviet Republic. This one lawyer living who was without electricity and growing her own food said, “We’re being demodernized.”
MG: One of the solutions that has been proposed—and has been sort of a darling across the board, in terms of something that would feed potentially, idealistically, a different economic system—is this whole notion of socially responsible investing. There are many different ways to do that, and the thinking behind that is, “If I give my money to X and Y, instead of A and B, then I am truly supporting, however incrementally, the evolution of a different economic system or different kinds of businesses.” But there’s some debate about this whole notion of SRI being a solution.
CAF: I was brought up and trained to believe that money is a tool you use to create your world. In other words, we have the power to invent our world, and money is one of the most important tools we use to collaborate and coordinate on doing that. In my experience, the most powerful people on the planet weren’t interested in making money; they thought very strategically. “Let’s go to Rome.” Well, how do we do it? “Well, we’ll engineer it so everybody makes money going to Rome, and then crowd will do it for us,” was kind of the thinking. Money is just a tool, and a very important one, and I think it’s essential to put your money where your values are. Part of what I promote is financial intimacy, which says, “Invest your money in things or people or products which you know and understand and can trust—or which people you know and trust understand and trust, because there’s not enough time in the day to understand everything, necessarily. So I think the general construct is a very good one. What we’ve seen happen in liquid socially responsible investment, which is the liquid funds, is a different story…
MG: By liquid you mean…
CAF: Publicly traded stocks and mutual funds—so, things that you can buy and sell in a market place easily. Venture capital is when you invest in private equity that’s not publicly traded, so it’s not very liquid. But if you look at socially responsible investing…
MG: …where most people put their money…
CAF: …where most people put their money, which is promoted to most people—it really has become an apologist for the Tapeworm, and it’s way of cycling peoples’ money back into the Tapeworm. I have a wonderful aunt who teaches women’s studies and is very active in the peace movement, very adamant about it. We did an audio seminar for Solari called, “Beyond Social Responsible Investing: Is SRI Hazardous to Your Wealth?,” and in it I mention a very popular SRI index fund, a social index fund, and how it’s invested in Halliburton. And my aunt was invested in it, and she called me after she heard it, and she said, “Oh my word, it can’t be that I’m investing in Halliburton!” So I walked her through the ump-dee-ump steps you have to drill down—because most of this stuff is sold by concept—there’s no intimacy so you really see where your money is going. So we drilled down, and she said, “Aah, I’m invested in Halliburton!” So I sat down with her and went through all of her portfolios, and she had two other mutual funds also invested in Halliburton. So here is a very serious and committed peace activist who’s finding herself constantly steered back into the Tapeworm. So I think SRI has really become an apologist for large corporate stocks, and part of it is—and this gets back to one of the most important things—they can’t see the Tapeworm. In other words, you can not be socially responsible unless you take the time and have a map as to who and what is doing that which is irresponsible. If I don’t know where irresponsibility is coming from, then I can’t know how to invest in a responsible way, because what I’m doing is I’m looking at the overt and I’m blind to the covert. And, in fact, my greater criticism of SRI is that it’s naïve. I would much rather have an investment advisor, or be investing with somebody, who is not naïve, who sees how it really is—because, by seeing the world as it really is, that’s the strategic pathway to really getting somewhere and doing something. So putting your money with somebody who is simply naïve about the way the world works is too frightening for words, because one of the most important things is that the world divides up between the pro-centralization team and the pro-decentralization team. We’ve got to preserve and build the wealth of the pro-decentralization team. My whole notion of “coming clean” and going with financial intimacy says, “Rather than our wealth—whether it’s our physical, social, emotional, spiritual or financial wealth—being drained, let’s stop being complicit. Let’s drain the Tapeworm by withdrawing the different ways we are complicit and support the Tapeworm, and shift it into things which really truly can start to build a new world.”
MG: You raise a really interesting point, and it’s getting over the hump of not just of our ignorance but of actually taking action—even though, in the short term, some of those actions may appear to be against our self-interest. Another story you had mentioned to me earlier was the Red Button. And I think it’s such a beautiful, and almost chilling, metaphor for what we’re confronting as far as changing our consciousness. There are competing collective stories that are out in the world right now. So, one is pro-central, one is de-central, and that’s one way to simplify it—but let’s go back to the Red Button story and see where that takes us.
CAF: Sure. I was giving speech to a wonderful group of people called The Spiritual Frontiers Foundation, who had gone off into the woods once a year, as they do, to talk about how they could help our society evolve spiritually. In the middle of the speech, I was addressing the fact that the U.S. economy launders 500 billion to a trillion dollars a year of all dirty money. So that’s narcotic trafficking, that’s slave trafficking, that’s financial fraud, it’s everything.
MG: These are central financial institutions that are doing this kind of business?
CAF: It’s remarkably broad-based—but, if my hypothesis is right, it’s led by the central banks and the large banks. But any large, successful financial institution. If you want to understand it more, I wrote a wonderful case study, sort of a business school-quality case study, of Tapeworm economics called “Dillon, Read & Co. Inc. and the Aristocracy of Stock Profits.” There’s a link to it on my home page, Solari.com. In it, in chapter 3, it describes the European Union lawsuit against RJR-Nabisco for global money laundering with the Russian mafia, the Italian mafia, Saddam Hussein’s family, and some other wonderful people—and it’s a 200 page motion. I got a lot of the legal documents and put them at the resource, and then quote extensively from it. It’s really a primer in money laundering—and, when you think of it, it’s eleven sovereign nations of Europe who have the intelligence capacity to put meat on the bone.
MG: I see a 12-part mini-series here. So back to the story though.
CAF: So I’m talking about this 500 billion to a trillion, and I asked this wonderful group of spiritually committed people, “What would happen if we stopped doing this money laundering?” And they said, “Well, we’d offend the people who control 500 billion to a trillion a year in accumulated capital, and their money would go elsewhere, so we’d have trouble financing the government deficit because we need to borrow money to run the government and for the government to write checks to all of us and all the corporations and everybody else—so our government checks might stop, and our taxes might go up, and that money would not buy stocks on the New York Stock Exchange; it would probably go to Hong Kong or London. And so that’s what would happen: the stock market would be in trouble, and the government finances would be in trouble.” So I said, “OK, let’s pretend there is a big red button up here on the lectern, and if you push that button you can stop all hard narcotics trafficking in your area, your city, your county, your town, your state, your country, tomorrow. Who here will push the button?” And out of 100 people dedicated to evolving our society spiritually, only 1 would push the button. So I said to the other 99, “Why would you not push the button?,” and they said, “We don’t want our government checks to stop, we don’t want our taxes to go up, and we don’t want our mutual funds to go down in price.” And that’s what I call the Red Button Problem; and the most important conversation I think we can have is, how do we make money pushing the red button? Because that’s the road to sustainable economics, because so many of us are trapped in doing what we’re doing right now, we’re trapped in having to play ball with the Tapeworm in a variety of ways, all in a way that makes us complicit. And of course, Matthew, if we made you president tomorrow, what you would discover is that everyone in America wants their check, they don’t want you to press the Red Button.
MG: [laughs] Which is why I’m not going after the office.
CAF: [laughs] What you’d have to do to get the 500 billion to a trillion dollars a year is whatever the people who control that money want you to do. And so, if they want you to go to war in Iraq, that’s what you’re going to do because what everybody wants is their check.
MG: On the surface it appears, at first glance, as a kind of lose-lose situation. But what you’re saying is you have to flip around the other side of it—that, instead of this deprivation thinking, you say there is a way to do it. And part of it is that you came up with this series of principles that you called “coming clean” and shifting to financial intimacy. Maybe we can spend a little bit of time talking about that.
CAF: I have a pastor who used to always say, “If you can face it, God can fix it.” The beauty of facing it is you start to see your own power and leverage, and if you start to look at ‘my bank deposits, my media attention, my purchases, my investment, my donations, the currency I use,’ what you start to see is the equivalent of your real power to choose who and what you give energy to. It’s really interesting: In 1998 I lived in a beautiful mansion in Washington, and I was writing a check on a JP Morgan Chase bank account, and JP Morgan Chase is the lead bank at HUD, and I realized, “Why am I banking with the same people who somehow must be deeply implicit in all of these shenanigans?” And that’s when I said, “You know, I’ve got to come clean.” So I started to do it just because it seemed like the right thing to do—and it took many years, and I’m still working at it. It’s a life-long process. And one day I woke up, Matthew, and something magical had happened: that I was, for the most part … a much higher percentage of my transactions … I banked at two small community banks that are just wonderful people and where you have an intimate relationship, and I was buying my food at the Hickory Valley Meat Market, and across the board there was a much higher level of intimacy. Another pastor I love always says, “Intimacy: into-me-see.” But there was a human-ness and a safety because I was dealing and transacting with people who I knew much better and had a much higher degree of trust with. I can’t explain, it but it’s made a huge difference. As you withdraw…. Did you ever hear the story about Jung and the birds?
CAF: Jung had a patient who came to see him after a nervous breakdown, and explained that as a young woman she had (this story was told at an investment conference and I’ve never gone back to check the original) married an older man who was very wealthy, and had taken a young lover and couldn’t reconcile her desire for wealth with her desire for her lover; so she murdered her husband and got away with it, and then had a nervous breakdown, and told Jung, when she came to see him, that from the time she murdered her husband forward, wherever she was, the birds would stop singing. She told Jung, “The birds knew.” And so this gets us into the discussion of morphogenic fields, which, as you know, I love in terms of explaining how markets function.
MG: Yeah, say a little more about that.
CAF: What we found when we were doing this twelve billion dollars of prototyping was: I was trying to understand how the natural elements and energy of a place relate to how money works within a place. I was trying to build an investment model that would align financial wealth with the harmony of a place and optimize the well-being of a place. And we’re not going to get into that tonight, but a lot of it has to do with financing places with equity where the equity is transparent to everyone there, not just to the Tapeworm who’s coming in to rape it. It was hard to get your mind around it until I read Rupert Sheldrake, and when I read The Presence of the Past I said, “Oh my word, this is a hypothesis that fits with exactly what I’m seeing!” Because, you know, it all comes down to optimizing the activities in the place, but then it networks. It’s really all about how knowledge and trust flows. But what that gets you down to is the fact that, at some level, there are no secrets. Right now, most of America lives in state of multiple personality disorder, where we think our values relate just to our personal actions but not to our transactions, and so there’s a lot of very negative karma that we’re creating, or is coming into our lives, through our transactions, because on some level the field knows there are no secrets.
MG: And for many people, however innocently that is, then we go back to not even knowing to a large degree what happens with your money—and who has the time to actually figure it out? I mean, at what point, and how incrementally, do you begin to make progress, shifting that perspective toward something that’s more giving?
CAF: Another really important rule of thumb that I can not stress enough is, Only do what gives you energy. The key is to look at it, take a deep breath and say, “This does sound like a big job, but let’s create the intention that we’re going to do it—and, as we come clean and start to shift….” For a lot of people, the first thing to do is to shift your bank. There are an awful lot of people who are essentially banking at the banks…. You know, if you’ve got a problem with how the federal government is run or, the war policy, or anything else, the thing you have to remember is, There is no government. Who runs the government? It’s basically a group of large corporations and large banks, but essentially the large banks run the central bank.
MG: So the simple principle there would be: go from big to small; go from international to local.
CAF: But go from something which, if you look at both overt and covert, is not excellent, always go for excellent. So we’re not just looking just for local. There may be a lot of local banks, but that doesn’t mean they’re excellent. If the pro-decentralization team is going to build a “we” and a vision, then we have to be about excellence. But generally it’s going to be a local bank. I have two banks: both are small community banks, but one is outside of Philadelphia. Most people have an excellent choice locally. And what’s amazing to me is people say to me, “Oh, this is going to be a lot of work, really hard,” whatever—and when it was over she said, “It’s so energizing; I feel great!”
MG: It’s not just a financial thing, it’s actually an energizing experience.
CAF: Absolutely! And, as a financial person, I really need an energetic healer to explain this. In fact, we have an audio seminar, Where Would Jesus Bank?, that has a checklist and walks you through how to find a new bank. But one of the people who told a story is an energetic healer who works with the Solari team, and we got her to bring that perspective, to try to explain it. Think of it like this: When you leave $1000 in a bank as deposits, then that bank can lend a multiple of that—which is very powerful. Where is that multiple? Where are you sending that multiple? One way I think of it, which is a little bit abstract: There is a wonderful book, Heart of the Cosmos, and in it Brian Swimme describes that if you create a vacuum, take everything out of that space, that what happens next is molecules just start to show up from the vacuum. And so, from a financial stand point, what I’m trying to say to people is, Where do you want to send those molecules? Do you want to send them into the Tapeworm or into a new world?
MG: And that’s sort of the process of empowerment and becoming energized by actually making these kind of decisions.
CAF: One of the funniest things to see is…. You have no idea how many good working, honest people there are struggling in all these organizations in media. The big guys who play dirty have been winning, winning, winning, winning, and the crowd’s been supporting them. The minute the crowd starts to say, “You know, we’re pulling our money out of this large bank and we’re coming in to you, you wonderful small bank. Thank you for trying to stay clean, and thank you for trying to stay honest.” I call them the “community wizards.” When they get a little bit of support and a little bit of appreciation, wow!
MG: There’s the multiplier effect right there.
CAF: The main injection from the Tapeworm is the corporate media—so to get people to just stop, cancel those subscriptions…. For example, there are a couple of newsletters that I use that are just fabulous. Do you know what those guys could do with a tiny fraction of the money and attention that gets poured into corporate media? So everybody’ll say, “Well, I’m only one person.” Wrong. It certain counts, because these guys and these girls can do so much with so little. But, more importantly, it makes a huge difference when you shift. I can’t tell you what a difference it has made in my life, and some of it’s just practical. My risk is significantly lower because I’m transacting with people who wish me well.
MG: Who actually really do wish you well?
CAF: They really do with me well, and they’re not so eager to do me harm. I went through a very amazing process of 18 audits and investigations and 12 pieces of litigation and all sorts of physical harassments and surveillance, and I’m alive today. One of the many reasons is because there were hundreds of honest people in government who just wouldn’t do what the most venal part of the Tapeworm wanted them to do.
MG: You made a statement earlier: Don’t ever say it’s too late, because that statement basically asserts that that matter has priority over energy.
CAF: If it looks hopeless in the material world, that because you’re thinking that your only solutions are coming from the material world.
MG: And that makes me switch over to this idea again of coming clean, and I’m looking at the list. You have them organized in three different categories. There are seven principles in each of these categories—“Cross-Cutting Opportunities for Cleansing & Building Our Total Wealth” is number one—but underneath that the first principle is, “Be divine.” What does that mean?
CAF: Well, think of it this way: Imagine what would happen for the pro-decentralization team if the birds knew we were doing our best and were on our side. (Remember my story about the birds?) So what I’ve found is that, when you’re in alignment with the divine purpose for your life, all sorts of miracles start to happen. Now if we can that and have the money in alignment with that, together, then you’re talking about an exponential kind of change. But it has to start with getting into alignment and doing your best to move toward alignment with the Divine—and that includes alignment with Nature.
MG: Absolutely. And I want to say, too, that there are 21 principles here, and it’s really a phenomenal document and statement, and I just encourage listeners to go to the website, Solari.com, to read this and have access to this and other sources of very inspirational information. And I don’t want to dwell on this here, because I want to cover a little bit more ground before we open the line to questions. Another thing that you wanted to address here is the idea of collaboration, that we are talking about individuals thinking that they can’t quite make a difference by themselves. And we’re saying, “Yes, you can”—but beyond that, finding others—this whole notion of collaborating, creating this sort of parallel system. Say a little about that.
CAF: We’re working on a product, which will be open-source, so anybody can do it without any connection with us. It’s called Solari Circles, and it’s a cross between a French resistance cell and an investment club. And I always tell people, “Don’t worry if there’s a conspiracy. If you’re not in one, you need to start one!” It’s really a conspiracy of twelve people or less, and the goal is really education and transaction: learn more about money and how you can use money to get what you want. It doesn’t have to be money per se—it could be time, which is the most valuable resource we all have—but how can we start to help each other save time, save money, make money, just get more energy by whatever definition you do it. Part of it is education. As you say, there are a lot of principles on becoming clean. Just talking about it helps. Not being alone in dealing with it helps. There are thousands of little different things. I always tell the story of three women who were very close relations: One had her money in a local bank CD at 3%; Citibank was their correspondent bank, so I figure Citibank’s getting the money for 4%. Another had money in Citibank thru 401K in the stocks—she’s making about 5%. And then the third was financing her business, paying Citibank 23% on a credit card. So Citibank has intermediated these three women, and there’s enormous profit potential (in this particular situation, not always) to simply disintermediate Citibank in a way that would have made these three women a great deal of money. But that only happens if you start talking about your money. So you have to be very careful. It has to be just with people you trust, and you have to start looking at you money in new ways. There are many different things you can do. I have a circle—we call it the first ever Solari Circle—and we’ve been investing for a couple years. The first thing we did was a simulation. We didn’t know each other—I knew everybody but we didn’t know each other, and we were doing it on a bridge call because I couldn’t find enough people in my place—so we did this simulation. (I do this in a lot of my workshops.) We said, ‘We are a family of four, we have 1 million in cash, and we’re homeless. Where are we going to live and how are we going to invest our money?’ In fact one couple in the circle left New York and moved to this place! It was funny. And our portfolio did so well we were kicking ourselves that it had been a simulation, so we started a general partnership and now we’re investing together. And a lot of us are using that knowledge that’s flowing off of the work that we do in the circle for our own lives and portfolios.
MG: And people without that kind of equity can still get together and, in their variety of different ways, learn the same principles and have the same impacts—if not in the same scale, but at least start to grow into that.
CAF: Very important thing to understand! When I was on Wall Street, Matthew, we bought and sold the world. And we didn’t have any money; we used other people’s money! What we were great at doing was identifying opportunities and creating plans. So you don’t need any money to do a circle; you can do a simulation. You can have a million dollar portfolio in your imagination and trade it and learn.
MG: What would you do with it?
CAF: You’d learn! Let’s say that everybody could put in ten dollars a month. You could accumulate a pool and invest in a whole lot of stuff even with only ten dollars a month. You could start to do coins. And you could also attract people who have some money. One of the great ways to turn around communities is: entrepreneurs come up with plans, and then other people who are invested in the stock market can do better pulling their money out of the stock market and investing it in the plans of a local entrepreneur.
MG: And for them it might be a matter of being a little more patient, but knowing that their support is actually directly helping the community that they live in.
CAF: Right. And I always tell the story of when I was on Wall Street, and when the company was successful in Washington, I ended up loaning or giving to friends and family about a quarter of a million dollars. In fact I never counted it until later, when the enemy of the state process started.
MG: You were an enemy of the state?
CAF: When I became an enemy of the state, it was the one source of money that the bad guys couldn’t shut off. In fact, all that money came back to me during that period. Everybody said, “Well, she helped us, and I guess she needs it. Let’s pay her back!” And it kept me alive. It literally kept me alive. If I had not been as generous as I had been, I would not be here talking to you today.
MG: Well, I’m certainly glad you’re here! And I guess this is a good opportunity to open the line to questions—but I also want to say to listeners that, when we formally close at 6 o'clock, you are willing to stay on the line and, in an informal way, engage in dialogue with whoever is there. I think that’s great and very generous. So, Angela, back to you to open up the lines.