Control of Writing and Re-Writing Rules is Key

I am a long time reader of a blog called "Of Two Minds" by Charles Hugh Smith.  He is an excellent writer and does a great job of explaining concepts:

Recently, he posted this: "The history of central banking is actually quite simple:

1. Central banks act to protect the wealth and power of those who own / control most of the wealth. This is their core unstated reason to exist.

2. To justify this absurdly transparent protection of the elite in the eyes of the public, central banks go through the motions of trying to extinguish the business / credit cycle, that is, trying to eliminate defaults and credit crunches which are the frequent but low-intensity fires that burn up the financial deadwood.

This destruction of excessive credit, leverage and liquidity is necessary to protect the forest--the entire economy-- from a much larger, out-of-control conflagration.

Central banks sell this endless expansion of financialization to the public as "we're getting rid of those horrible nasty recessions that hurt all you little folk," but in letting the deadwood pile up ever higher, central banks are only guaranteeing the eventual conflagration will consume the entire forest.

This is basically what happened in 2008-09: the deadwood caught fire despite the best efforts of central banks and almost burned down the entire forest."

They control the rules and they are the proverbial "House" for all of those entering their casino.  

“I don't make the rules, I just think them up and write them down.”

There is a lot of talk right now about the pending resumption of student loan repayment looming in August.  Some are pressuring Democrats to make good on their campaign promises of a debt jubilee for their constituents.  They will re-write the rules to suit their purposes.  It will be a blatant example of "great American voters" voting themselves direct funding from the Treasury.  Everyone with half a brain knows that "student loans" have been used for lifestyle expenditures as well as tuition.  The funding has pumped trillions into "higher education".  The Democrats are on the ropes right now and may see re-writing the rules and forgiving debt as politically expedient.

I said long ago that if this country were truly serious about returning some discipline to the student loan process, the bankruptcy rules would be re-written to allow for the inclusion of student loan debt in Chapter 7 and Chapter 13 cases.  The threat of potential loss is the only thing that truly focuses the mind of lenders and underwriters.  Apparently, re-writing those rules continues to be out of the question for those in authority.  Why?  Because apparently the current scheme greatly benefits the few at the expense of the many.