By GP Vaca
Implementation of "Citizen
Shares"
Hard to believe that the solution
to the economic problems of the world has been before our eyes, however, we
have not applied formulas by which a dynamic change in the global economy can
begin.
Virtually all Latin American
countries have in their hands enormous wealth that can be put to work for the
good of their people. Countries such as Venezuela, Ecuador, Brazil etc. They
have literally thousands of companies that have been founded and fully funded
by its citizens, and obviously created by their governments. Companies are
being managed, operated and administered by their governments. But what about
earnings and profit?
Everyone assumes that the
proceeds of such corporations are being used for the common good of the people,
and that nations and governments administer them for that purpose. The sad
reality is that there can’t be any doubt that the root of the prevailing
corruption throughout the continent, has much to do with the management of
these companies in question. Billions disappear and wasted, are wasted in
mismanaged funds.
The best example of this
situation is that Latin American governments often borrow to subsidize, pay and
finance projects of these companies, when the companies should be doing the
investment and financing of such works. Unlike a company like Exxon, which
depends on its investors; responds to investors and pays dividends to its
investors. They do not rush to their government to get a loan to build a
refinery? Of course not! It does this using their profits, and if more money is
needed, they resort to offer more shares in the stock exchanges. The question
then must be asked, why nations cannot function as "corporations" and
do the same when in fact the governments are managing them for their citizens.
A clear evidence that corporations need the entrepreneurs to make them more
successful.
To demonstrate this reality, take
the example of a company in North America. They start as an exploration company
in Ecuador, they pay the country of Ecuador the mining rights for exploration
and start out selling shares to finance such exploration, once they find gold,
they announced to their "investors" and start the exploratory phase.
Its shares jump from 0.92 cents to $ 8 in a few days. By October 2007, this
company has announced that it estimated that "resources," in minerals
are at least a deposit of gold from 58.9 million tonnes grading 7.23 g / t
gold, resulting in 13,700. 000 oz. of contained gold and 22.4 million ounces of
contained silver (grade: 11.8 g / t). (1) The deposit is the most significant
in the world in the last hundred years’ discovery. And there are tons of gold
in various ranges of Ecuador. Tons of gold for which companies will pay royalty
percentages as miserable as possible. The question is very simple, why then
Ecuador does not do the same as the company. It sells shares and works just
like a corporation. An organization that defends the rights of their
"investors", the Ecuadorian people.
That's what makes the whole
corporation. But in our countries rather than addressing the issue of debt by financing
as a corporate matter, like any other corporate entity will do, when you need
money, following the procedure that is universally known: Offering shares to
finance new projects. Our countries simply borrow. These debts that are
acquired are transferred to their citizens, then they finance projects and the
government pay for road building, bridges and power plants to facilitate the
"exploitation" of resources. In short, those measly cents of royalty
monies they have been paid by the "multinational companies" the
countries “invest” in building everything for the advantage of foreign
investors who win big.
But here are two vital things
that we must think, reflect and react. If our governments maintain hundreds and
often thousands of corporations; "Public undertakings" under their
control. The owners of these corporations and public enterprises are "the citizens"
Because these companies were founded with their taxes, their contributions,
their right to land. Often times citizens and whole tribes had their land
confiscated. Therefore, the just thing to do is to give them the shares they
own.
Indebted countries choose to
subsidize companies that are being mismanaged by directors that have being
appointed because they are politicians not because they have any experience
managing businesses. They produce very low profits and provide few benefits;
more often than they admit, funds end up in the hands of the incumbent
president and his cabinet, as most of these companies are under the direct
management of the executive. Needless to mention that our successive
governments have become the mere distribution of those enterprises.
In other cases, several companies
are run by the military, or by educational institutions or a particular
ministry. Therefore, the country often ends up hiring a "multinational
company" to explore and exploit resources in exchange for 7% or 8% of the
royalties. It is an absurd way to manage countries. Because in reality
companies like Exxon and Mobil, after signing an agreement with a particular
country; go and sell "shares to raise funds" to do the job that the
country should have done in the first place. Then they exploit the country, they
paid the paltry royalties and they win big, that is capitalism.
Unfortunately, socialism is
worse, because socialism was created and is managed by the world oligarchy.
They manage Trojan horses to manipulate countries, they get used to the idea
that the leader represents the people to build all the infrastructure needed by
the elite to exploit the resources of the nation. Socialism facilitates these
Trojan horses the loans needed to eventually plunge the country into more poverty,
and when the right time, which is never a day later than when they finish
building the necessary infrastructure. Then they tighten their lending and
create the necessary conditions for the people to accept any demands and they sell
everything than they built at the cost of millions, paying the same
multinational, who now would buy for cents for what they paid with tears.
Of course, the founders of Multinationals
will maximize earnings as they own the majority of shares, and will issue and
sell additional shares in exchange for a percentage of the profits, paying
countries the pittance they can negotiate. However, we have been convinced for
decades that only multinationals can handle such tasks. The reality is that
Ecuador, Colombia and most countries have been mining gold for centuries if not
thousands of years, as has been proven by the metal Library of Tayos Cave and
Cave of Mana. Gold mining is not such an impossible task and neither is the
drilling for oil or gas exploitation. They are for the most part, technologies
with decades of extensive knowledge where many experts, technicians and
engineers have been working.
It just does not make sense that a country that has the resources, scientists, money and businesses to do the job, would have to hire multinational companies to exploit the resource for paltry royalties. In the process we have allowed the world's wealth to fall into the hands of the Zionists Khazarians cartels. Those who have claimed to be Jewish and have positioned themselves as advisers to kings and queens since they destroyed the Roman Empire, to control everything from the shadows of global finance and banks.
So the solution to all economic
problems for countries is to simply use the same mechanisms that have been used
by the global elite in their private companies: this is the key:
In this new structure it is key
the distribution of shares: 24% of shares will be placed on reserve to be used
to support its currency and as savings for the country; another 21% must be
shares held by the government as founders and owners of businesses; 25% will be
sold to domestic investors, and 25% to foreign investors. Now, this opens a
door to erase poverty and make all citizens share the wealth. Because there is
precisely a 5% that can be distributed to each and every citizen. This is
indeed the way to eradicate poverty in all nations and to prevent World War
III. But above all, you must understand that is the right thing to do, because being
public corporations these were” created” by mandates from governments, were
precisely created using “money from taxes or wealth of the country”, therefore,
the real owners of these corporations and companies are none other than their
citizens, who should be given their respective rights of their shares, they
deserve nothing less as citizens.
How it would work.
If every citizen is given 100
shares of each company. As anyone involved in corporate finance knows, when a
company issues shares that pay about a penny per share to be registered. A
company can create billions of shares. But let us understand that by creating
15 million (in the case of Ecuador, as they have 15 million citizens) those shares
would cost only $ 150,000. So the distribution of 100 shares to each of its 15
million citizens, will cost only fifteen million dollars. That's an incredible
savings, if measured how far the country pays in welfare checks, medical costs
and social programs.
Now, imagine the possibilities.
The growing wealth of the nation, can go up in direct proportion to the
investments. In fact, by distributing shares of all their public companies to
all their citizens, so that every citizen will receive financial benefits of
every expense they make, every investment made, and all the country's
resources. Because you create the equitable distribution of wealth. Those most
astute and ambitious citizens can buy as many shares as they want. Companies
could increase funding for the wealth the nation begins to benefit everyone, to
a greater or lesser degree on their investment, but as the state has granted to
each and every one of its citizens an amount, everyone will benefit in a fair
and equitable manner.
It is absurd to continue the form
that the world has been operating. Most of the benefits go to those families
who have been controlling the world. Incredible but true. So, when using this
strategy, ownership of companies will no longer be in the hands of globalists
or financial characters, but in the hands of the citizens of that country. We
are not changing the structure at all, just the way it distributes and controls
the wealth.
It is obvious that many of the
financial woes of the nation then will be cured. Countries no longer need to
create all kinds of assistance programs. In a sense, every citizen will get their
money. The more they have invested and contributed more they will receive.
The government will not get a
measly 7% or 8% of royalties for oil, but will get 21% of the benefits of
management to reinvest, finance programs related to the oil industry or the
mining industry, etc. . While at the same time 24% of the profits remain in the
country to make stronger its currency and its finances. Intelligent citizens
who have invested in their country will get the dividend distribution of those
earnings. International investors who want to invest in oil and gold also benefit.
Everybody wins. International and foreign investors are needed, as it is in
foreign markets that the shares are sold at a much better price.
So let me analyze more carefully
what I am proposing.
You see, when a company needs a
cash infusion to expand its existing operations, further exploration, to
protect their market share, develop new business, build a new refinery; expand
exports or buy another company, it may require more money than they have
available. In that case, the directors of the company have two options: borrow
money or raise more capital.
Most Ecuadorian companies can
simply get a grant and make the government get debt to get the money. What I
propose here is none other than the second option, get the money as any
corporation does, as every corporation, offering shares. But the citizens remain
as an investor.
So for all intents and purposes countries
become true corporations. Partly as owners of the resource, of the corporation
and the shares then they have the right to issue 100 shares to each of its
citizens before the sale of the shares. It is their right as citizens who have
paid taxes and contributed to the country, the owners make their corporations.
That small action, ensures the financial well-being of each Ecuadorian family.
Poverty can be erased, wealth will be shared and true capitalism will finally
shine just as John Adams was actually suggesting. However, the advantages for
each "partner" is spectacular compared to the risk that other
companies have to run, let me mention some advantages:
1. The
political risk is deleted: While investors from Exxon or Mobil have to fear
political change in a nation that could affect the investment, due to changes
in government, usually they change the political environment and monetary and economic
policies, or civil war may happen as has been the case in Iraq, Afghanistan,
Libya etc. Thus under my proposal, the governance structure becomes its true
partner and the risk has been removed.
2. The
geopolitical and economic risk: While other multinational companies have always
feared a debt default by some countries, in this way the countries adopting
these policies will be financially stable, because it is creating the structure
to have a strong financial backing, strong savings and an alliance between foreign,
domestic investors and their government.
3. Market
risk: This is perhaps the most beautiful advantage. You know that other
companies have to fight hard and spend serious money to get market share, massive
amounts of money must be paid for mass advertising to put a product in certain
countries, in this case you become partners with companies that have
monopolized some sectors in each of their respective countries. So you have an
excellent partner, not only you are becoming partners with the country, but
with the consumer. When you become partners with CNT, for example, who sell
telephone services, internet, communication services in Ecuador, you cannot
lose. When you become partners with Flopec that controls most of the shipments
to and from Ecuador you cannot miss. But most importantly, you do not have to
fight for market share, its "partner" can do that with a decree, but
that is not necessary, because each Ecuadorian is his "partner" who
will happily spend, buy, because it is their business.
In assuming debt most companies
consider risky because they must have a reasonable expectation of steady cash
flow -profits- to make regular interest payments, plus it has the risk that
investors may feel that the company is also highly indebted (it has too much debt
relative to its shareholder funds), which can weigh heavily on the stock price.
But, in this case the shareholders and consumers are partners. In a sense, they
will be happy to consume.
Although most companies have to
deal with the risk of a possible bankruptcy, which is precisely what happens
when increases in interest rates paralyze businesses. Banks stop lending during
the financial crisis, which has forced many companies to raise capital funds at
very high prices and reduced investment in order to stay afloat. But in these
cases the partners are governments and financial institutions, and the citizens
themselves, which together will help manage what is best for consumers and
shareholders. Guess what? we are all in the same boat, so we have a real Scientific
Community of Wealth.
In today's world it seems that we
are working in the interest of the Federal Reserve and the banks that own the
Federal Reserve. The usual suspect and what I will call the criminal cartels
that have subjugated the world to poverty. Those who make money with interest.
Currency controls through the powerful forger who creates money out of nothing.
That must end, and we must deal with currencies that are backed by gold, silver
and a basket of natural resources. To avoid corruption, we have to do the same
with banks. Domestic banks should be equally owned by citizens; they must have
shares in their banks.
By creating this structure, the
government and citizens become partners as one mind. Each country will become
financially stable and with dynamic finances. They have 10% savings and 14% on reserve.
Of course, since banks make money from the debt and interest, then they have
always been pushing debts as "an attractive spending." Careful
analysis is required with respect to "interest tax deductible
expense." But if banks are required to have a minimum of 30% of property
investors citizen, then we all win equally. 21% must be owned by the
government.
Corporate finance strategists
usually charge a lot of money to decide the best way for companies to raise
funds, for each case that they conduct research say it will always be
"inconclusive data on the structure of the ideal capital to maximize the
value of a company to shareholders. " Of course, this is a game changer,
because expenses taxes, interest, public relations, and overall financial
management have some different dynamics. But I think it would be much wiser to
create a company that represents our systems and our partners of the Scientific
Community Wealth, so they can do everything in the interest of everyone
involved. In other words, if we create a consortium to make this possible in
all countries, because in fact we need to do this to bring it to fruition in all
Latin American countries simultaneously.
Under the system of Scientific
Community Wealth countries become true corporations, and citizens become real
shareholders. Under the system that is now used, most countries simply acquire
debt with huge interest (usually 8% or more) to provide a grant to their
companies in which they will invest. Unfortunately, much of that money ends up
in the hands of corrupt bureaucrats who cheat, overprice projects or mismanage
the money, and well before anything occurs that is invested properly, ends up
being wasted. That is so prevalent in South America that on average they are
paying up to seven times what projects cost in other nations. It is carried out
by simple means of applying higher costs, project studies, unnecessary
personnel to the point of overpricing everything.
What better example than in
Ecuador they ended up paying $ 19 million dollars per kilometer to build about
ten kilometers to access the new airport. Therefore, the need to incorporate a super
computer that will track virtually all expenses and all contracts worldwide and
provides a comparison of what is a fair price to pay for certain businesses and
services. We hope that, with the creation of this system, companies are
beginning to be managed responsibly as they have to respond to its
shareholders, its people, its government to corporate directors. All this
creates an atmosphere of checks and balances to eliminate corruption seriously.
In the future.
Therefore, when a country has the
need for more money, it does not have to resort to such agencies of the world
elite, they do not have to beg or grovel to the World Bank or the International
Monetary Fund. You can simply issue new shares for one of their companies, they
have several options available, much better than simply acquire or create debt
and subsidies, these options are:
1. Give
all existing shareholders the right to buy more shares, because if shares have been
provided to every citizen, then wealth had to increase for most citizens, who will
have the opportunity to buy more shares;
2. When
faced with a number of special requirements, such as a natural disasters and the
destruction of a pipeline, then immediate action is required, the country could
offer shares in a "placement" to a group of people, or institution such
as the IESS.
3. Also
as a third option will create a specialized "subsidiary", which give
investors the opportunity to direct funds to a specific aspect of the company,
usually with high growth prospects or the emergency crisis resolution.
"Citizen initiatives"
One of the most common ways
companies are raising new shares is through a “rights issue”: under this system
we will call them "citizen shares".
This means that companies like
common practice offer existing shareholders the right to buy more shares - in
proportion to their existing holdings - at a certain price. In this case it is
very important to use this method to issue "citizen shares". In
reality, a nation with a corporate entity, a public company where the
government holds all the "shares" now they must provide those shares
to the true shareholders, the citizens. So they have the right to give those
shares to the citizens, to give those shares in a sense is to transfer them to
the right owners of the nation, which are its citizens. Therefore, 5% of the
created shares will be delivered; in amounts of 100 shares to each and every
one of its citizens. Again the super computer is necessary to prevent fraud. In
a sense it is the right of every citizen.
Of course, for most existing
companies the issue price of the "rights" must be less than the
current market price to make the deal worthwhile. In the case of newly issued
shares of these new business entities where the state owns the corporation much
like a sole proprietorship. No price on the stock exchange has been established.
So the country has the right to establish the number of shares and 5% of the
shares must be delivered and distributed to its citizens, before assessment and
distribution of shares and before entering the financial markets for sale. For
the protection of all investors these "citizen shares" should have a
ban on the sale for five years "just to keep the market safe and not
flooded with shares, especially from people who do not know the markets and
could be influenced by scare tactics, so it will be a guarantee for the company
to avoid any damage to the value of the shares when those citizens have yet to
contribute to the "society". It is a measure of protection. In making
the stable company and that some shares will not be sold for a certain amount
of time.
At first, it may sound like a
crazy idea to give shares, delivering or granting shares to "people"
without their having done anything. But that will be a lie. It is not shares for
nothing - after all, citizens are who, with their taxes, with their
contributions, financed by their sacrifice "funded" those corporations.
Therefore, they are only receiving what is their "rights as citizens",
certainly those shares will be valued like all others and could eventually be
sold. However, it is crucial to the success of the company, because it will
create wealth for every citizen, and help correct many social and economic
problems of each nation and will make every nation much stronger and
financially sound. It really is the way to eradicate poverty. Every citizen
will get a check and not as charity, as a bond of assistance, not as aid but as
"investors" and that is empowering people by this law issued by his
country and his fellow citizens.
So none of the
"investors" should worry about those shares. There should be no
consideration that a country and the company are carrying out a
"social" welfare of their money, on the contrary, the purpose has to
be the recognition of the true partners. It is a "rights issue". The
plan, of course, is not raising money, but you must understand that because the
country founded the corporation, financed its existence, factories, land,
machinery, etc., which was done with state monies, monies of those citizens who
now worthily receive their shares for justice as worthy owners of the company,
and are therefore entitled as country's citizens, as taxpayers of their nation,
as those who paid taxes and were in fact investors; indirectly, even if it was
the state who founded and created the corporation. This is under the
"sovereign mandate" thus who are actually the owners of the corporations?
Certainly citizens. It's your money, without their mandate the government could
not have created and funded "public companies" and are entitled to a
small number of those shares. For in truth and in reality it is always the
citizen who has awarded the money to his government to create such
corporations. In fact, it is only the just and worthy thing to do that as
owners of corporations, now that their companies need money, respectively the
country needs money, whether through government to get more capital. But this
will not work and it will not be able to give good results unless we start
doing the right thing and delivering at least one hundred shares to each
citizen. This will give incredible fruits and eliminate poverty in the future.
Because there will not be any more homeless citizen, no one fellow who does not
have anything to survive. It is vital to do it; it is what it means homeland.
It is the revolution of our economies. If it comes to obtaining additional
capital to expand a business that will greatly enhance its competitive position
and purchasing power, then the "rights issue" or "citizen
shares" are just giving legality to the real "shareholders public
corporation "and of course it was not the government but his own people.
It's a question of rights in this
case, then it is the transfer of shares to the true owners of the corporation.
It becomes the safeguarding of the corporation, why? for the first time ever,
citizens are reaping the benefits, they will share the wealth of the company that
was created with their taxes. The fact is that the government is only the
"manager", indeed the government is merely the administrator and only
temporary. It is a mistake that must be corrected: The citizens are the real
owners of public corporations and it is they who should receive benefits in the
form of dividends, the wonderful thing is that once you perceive and receive
your money, you become an " active investors "in the wealth of the
nation. So we all win and nevermore the wrong people; and that is usually the
bureaucrats and politicians, rulers and profiteers of turn. Profits are being
mismanaged. FINALLY, profits are being distributed to those who have the right.
Placements
Probate issues can cause problems
for everyone involved and it takes a long time to organize. Thus, Ecuador
should have its own team of specialists who perform this work without paying
large amounts of money to companies that do such work at a huge cost, but
actually do nothing but fill out forms and requirements by investment
institutions. It is essential to create this "institution" to handle
that aspect and can be profitably if the situation for the rest of the nations
at the best prices is handled.
Share divisions - half the price
Many people wonder how it becomes
possible that many companies still sell its shares for less than $ 10. The most
amazing thing is seeing companies that are truly worthy with very low prices
and you think their stock prices should be at $ 50, $ 60, even $ 100.
The answer lies in the device
known as the "split" stock markets. The theory behind such is that
investors prefer to buy 1,000 shares at $ 2 each, than to 2 shares at $ 1,000
each. On this basis some companies saw their shares rise for several months or
years, they can reset the price to half or even a third of its previous level
(two for one, three divisions one and so on).
Issues experience - a division
with a difference
While some investors think on
issues of bonus as gifts from a company and the word "bonus" means
something for nothing, the reality is they do not have the same effect as share
splits.
Under a bonus of 1-for-4,
shareholders will receive one free share for every four shares held. If you own
1,000 shares traded at $ 2, you will receive 250 shares "free".
Unfortunately, as it is a
question of rights, gifts increase the supply of shares and tend to drag the
market price down.
1,000 shares at current market
price x $ 2.00 = $ 2,000
250 "free" shares = $ 0
The cost of all shares = $ 2,000
The average value of their shares
after the bond issue will be the total cost of their shares ($ 2,000), divided
by the number of shares they already own (1250), which comes to $ 1.60. Your
investment of $ 2,000 is still a value of $ 2,000 - just in theory now has
1,250 shares trading at $ 1.60 instead of 1.000 shares traded at $ 2.
Some freebies!
In reality, of course, increases of
capital release can work in your favor if it’s made by quality companies and
stock prices do not retreat in what the theory suggests.
But do not assume it is guaranteed
something for nothing. As the Reserve Bank cannot print money without devaluing
the currency, something that unfortunately people do not seem to understand
that the more the Fed prints money the less the dollar is worth. For there are
many more dollars circulating diluted in value, as companies cannot create
value out of thin air. Therefore, it is prudent to limit the use of these
techniques in a system of the Scientific Community Wealth.
Repurchases;
This is the best way a company
can create value for shareholders, if you have funds ready and no immediate
growth opportunities to invest. In the same way that a share issue increases
the number of shares outstanding and depresses its price, a buyback reduces the
number of shares outstanding. This raises the earnings per share (the same
profits, fewer shares, more to go around), which usually affects upward on the
share price. Therefore, we must be prudent for the country to buy the shares of
citizens after five years if they can, which will increase dividends to
shareholders.
If a company can halve its
earnings per share to double its shares in question, the same company can
double its earnings per share by simply halving the number of shares. This is a
key aspect of wealth creation for the people. The effect on earnings per share
through a share buyback is also a good sign that the administration has enough
confidence in the future of the company to invest in itself. It also means that
the management do not necessarily feel compelled to expand for the sake of
expansion, unless the right opportunities arise.
When a public company issues new
shares, the total number of shares traded on a secondary market rises. Assuming
no change in the fundamentals of business and profitability.
Capital not issued
"Stock"
The Stock a publicly traded
company is authorized to issue, but it has not. In general, the statutes of a
company specify the maximum number of shares that can be issued, but
shareholders may increase or decrease according to the procedures contained in
its records. Normally there is a greater amount of capital securities issued
not required in order to give a company the greatest amount of flexibility. Therefore,
it is extremely vital to keep 24% as backup shares. That only serves to enrich
and make the company much stronger. Not issued capital is held in restraint.
When a company incorporates a maximum number of shares in the legal
documentation specified. Most companies make this a VERY large number to never
face that limitation.
You do not necessarily expect the
stock price change. The reason that a company issues new shares is to raise
more capital. Although the new shares are issued, the money raised from its
sale becomes an asset in the balance sheet of the company.
Buy my Book. You will see that it is the solution to the World Economy. I will soon publish more ideas.