Read Terror on Wall Street, a Financial Metafiction Novel for Free Online Page B

much more basic than that.  It’s more likely going to be from a disruption in the water supply, power, and from lack of food due to an economic collapse.  Either that or a financial war.”
         “Financial war?”
         “Yes.  Our automated trading and banking systems are just as susceptible to cyberattack as our buildings are to a physical terrorist attack.”
         Harry paused a while for his whiz kids to get a handle on the problem.
         “That’s why your participation in this class is important, not only for your own purposes, but the benevolent task for which I have indentured you all.”
         “What is the task?” asked Snookie.
         “We’re going to help the Congress to help the people by giving them the tools they need to save the world economy from collapse.”
         Harry regarded the students seriously so that they could see that this was no joke.
         “What makes you so sure that we’re on the verge of a collapse?” asked Carlos.
         “Well now, I don’t have to tell you that I’ve been around a little longer than you.”
         Harry smiled, and the group collectively chuckled.
         “I had a front row seat in 1998 when Wall Street bailed out the failing hedge funds.  We missed the bullet back then, but we never learned; because ten years later, as a result of the burst of the housing bubble, the big banks were on the verge of failure. But we just printed more dollars and bailed them out.
         “We won’t be able to print ourselves out of the next crisis, I’m afraid.”
         “Why not?” asked Ike.
         “Can anyone answer Mr. Pendleton’s question?”
         Snookie stood up.  “Because the U.S. dollar is a liability on the Fed’s balance sheet.  It’s only money if we believe it’s money.”
         “That’s right, Ms. Baxter.  You’re almost there.  And why is it only money if we believe it’s money?”
         “Because everything is digital.  The banks control your money.  The dollar is actually nothing more than a liability: a promise to pay.”
         “It’s a fiat currency,” said Harry.  “Does anyone know what that means?  Yes, Mr. Rodriguez?”
         “We know it only too well in Mexico.  A fiat currency is one that the state identifies as a particular form of money to serve as legal currency.”
         “That is correct.  It’s money because the state says it’s money.”
         “It’s a contract, isn’t it?”
         “Yes, Mr. Thompson.  And, for our fiat dollar, who are the parties to that contract?”
         “The Federal Reserve, which issues the money, and the U.S. Treasury, which provides the collateral for the notes by issuing treasury securities.”
         “That’s right, Mr. Thompson.  They’ve been printing about $80 billion per month to avoid a collapse of the U.S. financial system."
         “But, professor, you’re talking about the dollar as a world reserve currency.  If the dollar loses its value, then the U.S. Treasury won’t be able to pay its debts, isn’t that right?”
         “Yes, and in fact, any catastrophic event (such as the near bank failures of 2008) could cause the collapse of the dollar, which would also collapse the euro, because the dollar is its reserve currency.  And once the world stops using the dollar as its reserve currency, all the functioning economies in the western world will collapse.
         “What that means is that prices for everything will go up 300-400% as foreign exporters reject the dollar for trade.  Since those exports can only be bought in another currency, it will take massive amounts of dollars to buy that currency.  People who had enough money to live on before will realize that their money’s buying power has been eliminated, and they won’t be able to buy food.  The food supply itself, which operates on very small profit margins and survives only as a