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Gary Edwards

A Word of Advice to Financial Authorities: Default! Bill Bonner's Lessons from History - 0 views

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    What we are reckoning with is the breakdown so big hardly anyone notices it. The model of a political economy set up in response to the industrial revolution is now worn out. Exhausted. Headed for the trash heap of history. We're not in the habit of giving advice here in The Daily Reckoning. Sure, we warned readers about the biggest threats to their finances in 30 years - the bubbles in tech stocks and then in housing. And sure, we urged them to buy what turned out to be the best investment they could have made - gold. And yes, we criticized governments for doing all the wrong things. But urging them to do the right things would be both futile and earnest. Futility doesn't bother us. But we can't stand earnestness. Left unchecked it leads right to world improvement…and thence to Hell. Still, in the spirit of civic betterment, today exceptionally, we offer a bit of advice to financial authorities all over the world. In a word: Default! When you have more debt than you can pay, it is always best to own up…default…hang your head…say you're sorry…promise not to do it again… …and go about your business. And do it as soon as possible. Whence cometh this august advice? From the pages of history - recent…and not so recent.
Gary Edwards

Jenkins: Obama vs. the 1980s - WSJ.com - 0 views

  • "World Tax Reform: A Progress Report," his 1988 volume showed how country after country was following the U.S. in adopting Reagan-style rate-flattening and tax simplification.
  • Mr. Obama now craves a federal infrastructure bank, apparently still unable to see how growth might emerge except by bureaucrats bossing around tax dollars.
  • Simpson-Bowles Commission—proposed a Reagan-style tax reform
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    excerpt:  Instead of a "stimulus" to create jobs by financing useful investments that would have paid a growth dividend in the future, we got a debt-fueled permanent expansion of entitlements and the size of government. In health care, instead of reforms to encourage competent consumers not to treat health care as a free lunch, we got a doubling down on health-care free lunchism. In banking, instead of new incentives to cause creditors to pull in the reins on risk-taking banks, we got a formalization of too big to fail. All economic crises begin differently-this one began in housing-but eventually they morph into the same old crisis of forgetting what works. Think about the last big crisis of faith in American capitalism in the early 1980s. The panic was eventually crystallized in dueling Harvard Business Review articles by George Gilder and Charles Ferguson. Mr. Ferguson, an MIT-based consultant, argued the U.S was dooming itself to vassalage unless Washington brushed aside small, poorly-funded entrepreneurs and concentrated regulatory favors and subsidies on giant firms like IBM, AT&T, Digital Equipment and Kodak. Mr. Gilder championed the then-emerging Silicon Valley paradigm. He quoted technologist Carver Mead: "We depend on the innovations of the citizens of a free economy to keep ahead of the bureaucrats and the people who make a living on control and planning. In the long term, it's the element of surprise that gives us the edge over more controlled economies." Who won hardly needs to be belabored except that it apparently does need to be belabored. Almost everything Mr. Obama understands as pro-growth consists of bets on "bureaucrats and the people who make a living on control and planning."
Gary Edwards

OpEdNews - Article: How the Greek economy and IMF might help banksters -- and defeat Ob... - 0 views

  • Something else to consider:   our Federal Reserve is heavily invested in those European banks, and has, in a very real sense, 'loaned' them hundreds of billions dollars of our tax money.   And so, if they go, we go.   In other words, American taxpayers will once again be responsible for "taking up the slack."
    • Gary Edwards
       
      The first time ever July 2011 GAO audit of the Federal Reserve has $3.08 TRILLION dollars being transferred to European Banksters in 2009-2010.  The Quantitative Twist Program announced by head Bankster Bernake in early September 2011 has these same Euro Banksters cued up for trillions more.  This cash infusion from American taxpayers bails out the Euro Banksters without solving the soveriegn debt problems that are the real issue.  Imagine if the bailout went to pay off the sovereign debt?  No restructuring of existing loans.  Just a simple $3.08 Trillion @ Ford Corp interest rate of .89%, coupled with a 30% reduction in government and government pension funds.  Why bail out failing Banksters who made bad loans and really bad decisions, when the problem is failing nations?
Gary Edwards

12 Charts That Show The Permanent Damage That Has Been Done To The U.S. Economy | Silve... - 0 views

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    "Most people that discuss the "economic collapse" focus on what is coming in the future.  And without a doubt, we are on the verge of some incredibly hard times.  But what often gets neglected is the immense permanent damage that has been done to the U.S. economy by the long-term economic collapse that we are already experiencing. But because unprecedented levels of government debt and reckless money printing by the Federal Reserve have bought us a very short window of relative stability, most Americans don't seem too concerned about our long-term problems. They seem to have faith that our "leaders" will be able to find a way to muddle through whatever challenges are ahead.  Hopefully the following 12 charts below will be a wake up call. The last major wave of the economic collapse did a colossal amount of damage to our economic foundations, and now the next major wave of the economic collapse is rapidly approaching."
Paul Merrell

Iceland convicts bad bankers and says other nations can act | Reuters - 0 views

  • Iceland's Supreme Court has upheld convictions of market manipulation for four former executives of the failed Kaupthing bank in a landmark case that the country's special prosecutor said showed it was possible to crack down on fraudulent bankers. Hreidar Mar Sigurdsson, Kaupthing's former chief executive, former chairman Sigurdur Einarsson, former CEO of Kaupthing Luxembourg Magnus Gudmundsson, and Olafur Olafsson, the bank's second largest shareholder at the time, were all sentenced on Thursday to between four and five and a half years.The verdict is the heaviest for financial fraud in Iceland's history, local media said. Kaupthing collapsed under heavy debts after the 2008 financial crisis and the four former executives now live abroad. Though they sometimes returned to Iceland to collaborate with the court investigation, none were present on Thursday.Iceland's government appointed a special prosecutor to investigate its bankers after the world's financial systems were rocked by the discovery of huge debts and widespread poor corporate governance. He said Thursday's ruling was a signal to countries slow to pursue similar cases that no individual was too big to be prosecuted.
  • "This case...sends a strong message that will wake up discussion," special prosecutor Olafur Hauksson told Reuters. "It shows that these financial cases may be hard, but they can also produce results."Not all of Iceland's prosecutions have succeeded. But the country's efforts contrast with the United States and particularly Europe, where though some banks have been fined, few executives have been tried and voters suffering post-crisis austerity conditions feel bankers got off lightly.A recent scandal at the Swiss private bank of Europe's biggest lender HSBC has highlighted the controversy again and sparked a political row about whether the bank did enough to pursue possible tax dodgers..
  • Iceland struggled initially to appoint a special prosecutor. Hauksson, 50, a policeman from a small fishing village, was encouraged to put in for the job after the initial advertisement drew no applications. Nor have all of his prosecutions been trouble-free: two former bank executives were acquitted in one case, while sentences imposed on others have been criticized for being too light.However, Icelandic lower courts have convicted the chief executives of all three of its largest banks for their responsibility in a crisis that prosecutors said highlighted the operations of a club of wealth financiers in a country of just 320,000 people.They also convicted former chief executives of two other major banks, Glitnir and Landsbanki, for charges ranging from fraud and market manipulation.Parliament relaxed bank secrecy laws in Iceland to help the prosecutors investigate bank documents without court orders."Why should we have a part of our society that is not being policed or without responsibility?" Hauksson said. "It is dangerous that someone is too big to investigate - it gives a sense there is a safe haven."Seven criminal cases involving bankers have made it to the Supreme Court, which upheld six of them. Five more, including cases of CEOs - are due to be heard by the top court. Another 14 cases are awaiting possible prosecution, Hauksson said.
Paul Merrell

Syria invasion plan? Turkey will defend its 'Aleppo brothers,' says PM Davutoglu - RT News - 0 views

  • Turkish PM Ahmet Davutoglu pledged to return a “historical debt” to Turkey’s “Aleppo brothers” who helped defend the country in the early 20th century, just days after Russia warned of Ankara’s intentions to invade Syria as the rebels there falter. “We will return our historic debt. At one time, our brothers from Aleppo defended our cities of Sanliurfa, Gaziantep, Kahramanmaras, now we will defend the heroic Aleppo. All of Turkey stands behind its defenders,” Davutoglu said at the meeting of the Party of Justice and Development parliamentary faction, which he heads.
  • Davutoglu was apparently referring to World War One and subsequent events in the Turkish War of Independence, seemingly glorifying the defense and retaking of Turkish cities from the Allied forces. Yet, he failed to mention that the Turks had been drawn into the war by Ottoman imperial ambitions. Turkey had entered the conflict by shelling the Russian port of Odessa from the sea. It then suffered a humiliating defeat at the hands of Russian troops in the war’s southern theater, before the Ottoman Empire was occupied and divided by the Allies. At the time, the three cities Davutoglu named saw thousands of Armenians and other minorities slaughtered by Turkish nationalists as part of the Armenian Genocide, which Ankara denies to this day.Alarmingly, the statement comes less than a week after Russia’s Defense Ministry warned that Turkey was preparing a military invasion of Syria and is trying to conceal illegal activity on its Syrian border.
  • “We have significant evidence to suspect Turkey is in the midst of intense preparations for a military invasion into Syria’s sovereign territory,” Defense Ministry spokesman Major General Igor Konashenkov told reporters in Moscow. Konashenkov also stated that Turkey had canceled an agreed upon Russian observation flight that had been scheduled over its territory because of its illicit activities. “So if someone in Ankara thinks that the cancelation of the flight by the Russian observers will enable hiding something, then they’re unprofessional.”Moreover, Konashenkov pointed out that Turkey has already been supplying terrorists in the Syrian cities of Idlib and Aleppo with manpower and weaponry.The spokesman showed the media a photo of the Reyhanli checkpoint, saying that “through this very border crossing – mainly at nighttime – the militants, who seized the city of Aleppo and Idlib in northwestern Syria, are being supplied with arms and fighters from Turkish territory.”
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  • In one of the leaked recordings, a top government official mentions how an attack on the tomb of Suleyman Shah, the grandfather of the Ottoman Empire’s founder, could do the trick. The monument is located in the Islamic State (IS, formerly ISIS/ISIL)-embattled Syrian province of Raqqa, which is just over 30 kilometers from the Kurdish border town of Kobane and 1.5 hours’ drive from Aleppo.
  • Meanwhile, Turkey has denied any plans to invade Syria. “Turkey doesn’t have any plans or intentions to begin a military campaign or ground operations on Syrian territory,” Reuters cited a senior Turkish government official as saying.This is not the first time alleged plans by Turkey to invade Syria have been reported. In 2014, Turkey shut off access to YouTube after an explosive leak of audiotapes revealed that its ministers had been discussing how to stage a provocation that could justify a military intervention in Syria.
  • The alarming new developments come as jihadi forces fighting President Bashar Assad’s army in northern Syria are suffering losses and retreating to the Turkish border.   Moscow had provided the international community earlier with video evidence that Turkish artillery had fired on populated Syrian areas in the north of Latakia Province. 
  • Allegations that Ankara is planning an invasion of Syria come amid what would appear to be growing disconnect between Turkey and the US over their respective ambitions for the region. Notably, Turkey considers the US-backed Kurdish fighters in Syria to be terrorists akin to the Kurdish rebels fighting in eastern Turkey, and has recently been sending diplomatic signals to Washington that it is unhappy with America’s support of Kurds.“We don’t recognize the PYD [Kurdish Democratic Union Party] as a terrorist organization, we recognize the Turks do,” US State Department spokesperson John Kirby said at a briefing. Turkey summoned the US ambassador in Ankara after Washington announced that it does not consider Kurdish fighters in Syria to be terrorists. The Kurds, however, are not the only issue where Ankara’s ambitions appear to clash with the desires of the White House, and this includes a possible unilateral military intervention in Syria.
  • At a press briefing, the US State Department chose not to reveal what was discussed at the ambassador’s meeting, but when RT’s Gayane Chichakyan pressed Kirby with a question regarding Davutoglu’s statement on “defending Aleppo,” here is the vague response she received:“You should talk to the Turks about what they are implying or inferring or suggesting in that statement,” Kirby said. “We continue to believe two things. One, there isn’t going to be a military solution to this conflict. The second thing, we do look for Turkey’s assistance on the military front when it comes to fighting Daesh [IS].”Kurdish fighters have been known to closely coordinate their actions with US forces in the fight against IS in both Iraq and Syria.
  • While this is far from the first time in the civil war that Turkey seems to be threatening Syria with an incursion, Middle East specialist Ali Rizk warns that Ankara has been behaving “irrationally” and anything can be expected.“Turkey very much wants to achieve a goal … they have dreams and aspirations about the Ottoman Empire. Those dreams are very much linked to what happens in Syria. Particularly, the northern city of Aleppo, which is considered to be, by the Turkish leaders, part of the former Ottoman Empire … It’s always possible that you might see illogical or otherwise irrational policies being resorted to, be it a ground invasion or be it any military intervention,” Rizk told RT.
Gary Edwards

A brief bit of history concerning the posting on the "Liberty in the Breach" blog - 1 views

The content for the Liberty in the Breach (http://goo.gl/AAFJ9) blog is posted directly from a Diigo.com group called "Socialism and the End of the American Dream". So yes, this groups bookmarking...

started by Gary Edwards on 08 Jul 13 no follow-up yet
Paul Merrell

Saudi Arabia in Search of a New Course | nsnbc international - 0 views

  • Saudi Arabia, one of the wealthiest countries in the world, is experiencing serious financial problems. The ongoing plummeting of oil prices is forcing the Saudis to be more careful with money. Tens of billions of dollars invested abroad are making a return to the kingdom. In July 2015, Saudi Arabia’s authorities, for the first time in 8 years, issued governmental bonds worth $4 bn.
  • Bloomberg reports that Saudi Arabia has already withdrawn $50-70 bn, which it had previously invested worldwide through management companies. It is noteworthy that the country has been withdrawing funds for the past six months. For example, Saudi Arabia’s SAMA Foreign Holdings reached its maximum in August 2014, having amounted to $737 bn. But since then, the fund has been shrinking because oil prices have dropped more than twice in this period. Saudi Arabia’s budget deficit is forecast to reach 20%; however, reduction of expenditures still remains a sensitive topic. In the context of the continuous fall in oil prices, Riyadh has worked out a plan to gradually reduce public spending to cope with a sharp decrease in budget revenues caused by the slumping oil prices. For example, Saudi Arabia’s Ministry of Finance has issued an order prescribing all state companies to temporary stop hiring new employees and launching new projects until the end of the fiscal year. In addition, the government procurement of new cars and furniture has also been put on hold as well as the signing and approval of new lease agreements for state institutions and enterprises. The expropriation of plots of land for the purpose of the subsequent extraction of oil has also been suspended throughout the country. The Ministry of Finance has, at the same time, demanded an acceleration in the collection procedure of oil revenues.
  • “To prove that the country indeed has a sound fiscal discipline, the government has to take steps to cut expenditures in the 4th quarter. Subsequently Saudi Arabia will be compelled to find new ways to reduce expenditures and boost efficiency in order to assure there will be no budget deficit in 2016,” John Sfakianakis, Director of the Middle East Division of the Ashmore Group, said in his interview to Bloomberg. It should be pointed out in that regard that oil revenues comprise about 90% of Saudi Arabia’s budget, and the landslide of oil prices of over 40% within the last 12 months adversely affected the country’s financial standing. And, although the kingdom’s debt burden remains one of the lowest in the world (less than 2% of the GDP), the kingdom’s international assets have been consistently shrinking for the last nine months and reached a two year minimum. This situation directly influences the policy of OPEC since Saudi Arabia (which extracts almost 30% of the OPEC’s oil, positions itself as an extremely influential raw material supplier, maintains powerful military forces, and has its own global ambitions, immense resources and substantial diplomatic experience) de facto plays the role of the shadow leader of this organization. At times siding with the US, and then pursuing its own interests, the kingdom has assumed such an influential position in the international community that other countries revere its opinion, and as for the last oil crisis, Saudi Arabia is seen as its key player.
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  • And, based on the information provided by the international mass media, the Saudi leadership has split in their opinion on whether to continue funding Syria or to begin reducing their financial commitment. “Riyadh is facing a choice: to give more support to the moderate opposition or to look for a compromise,” an American expert on national security, James Farvell, wrote in The National Interest. The expert explained that if Saudis offer more support, that would trigger a confrontation with Russia, but if they side with Moscow, Russia’s regional influence might be reinforced and that might, in turn, challenge Saudi Arabia’s interests. Because of this dilemma, controversial information regarding Saudi’s decisions are appearing in the press. On the one hand, Saudi Arabia was one of the first to condemn Russia after the beginning of the Russian military operation in Syria on September 30. It accused Russia of bombing the troops of moderate opposition instead of ISIS. “These attacks resulted in the deaths of numerous innocent victims. We call for a stop it immediately,” demagogically and groundlessly said the representative of Saudi Arabia Abdallah al-Muallimi in the UN. Simultaneously 53 religious leaders signed an online appeal to support a jihad against the Syrian authorities as well as the presence of Russia and Iran in this country. They appealed to the countries of the Muslim world to render “moral, financial, military and political support to those who are called the ‘holy warriors of Syria’.” The authors of the appeal explicitly stated that if they fail, the other Sunni states in the region, and, first of all, Saudi Arabia will be the next victims.
  • With reference to a high-ranking Saudi official who wished to remain anonymous, the BBC stated that armed groups of the so-called moderate opposition would receive new, high-tech weapons, including tank destroyers. Jaish al-Fath, The Free Syrian Army and The Southern Front moderate opposition groups will also receive support. According to the source, it is quite likely that the “moderate opposition” in Syria will receive surface-to-air systems as well. Keeping in mind that Russia is carrying out air strikes across not only the facilities of ISIS, but also the above listed groups, a scenario when Saudis turn their weapon against Russian aviation is quite possible. On the other hand, a curious document, apparently a copy of the instructions issued for the embassies of Saudi Arabia in the Middle Eastern countries, has been uploaded to the Internet. The main idea of the documents is that all the diplomatic representative offices should gradually cease financial support of the armed Syrian opposition, apparently owing to the low efficiency of militants’ activities. The authenticity of the document raises certain doubts, as is always the case with such documents. However, specialists in the Arabic language concluded that the text was written by a native speaker, and that the document’s design conforms to the style adopted in Saudi Arabia. It shouldn’t be ruled out that the drying up of the source of funding, that militants used to receive from the Saudis, against the backdrop of a certain degree of success of the government troops as well as the increasing military and technical assistance to Syria on the part of Russia, have convinced many “oppositionists” to surrender and change masters. This process is expected to only accelerate in the future.
  • On Sunday, October 11, the Defense Minister, Mohammed bin Salman, visited Sochi. The search for common ground on the issues related to the situation in Syria was the main theme of the meeting held by the son of the Saudi king and Vladimir Putin. The parties also discussed the prospects of their economic cooperation. And, since Saudi Arabia is currently experiencing certain financial difficulties and is in the “clutches” of economic uncertainty, this topic was of a special interest. It was the second visit to the Russian Federation of the Saudi prince, who currently carries out sensitive missions related to the complex relations between the two countries. It should be noted that King of Saudi Arabia Salman bin Abdulaziz Al Saud has been admitted to hospital in a critical condition and is currently being kept in the intensive care unit of the King Faisal royal hospital in Riyadh.
Paul Merrell

PDVSA Secures $2.8 Billion Bond Swap to Avert Default - nsnbc international | nsnbc int... - 0 views

  • Venezuelan state oil company PDVSA announced Monday that creditors had accepted a proposal to exchange US$2.8 billion in bonds maturing in 2017 for $3.4 billion due in 2020. 
  • In late September, the state oil giant presented creditors with a modified offer to exchange $5.325 billion in bonds due in 2017 for securities payable at 1.22 times the principal in 2020. With the deadline for the deal fast approaching and less than half of bondholders on board, PDVSA extended the cutoff three times and threatened to default if a majority did not accept the deal. By the final deadline Monday, 52.57 percent of creditors agreed to the offer, amounting to a successful swap of 45.3 percent of bonds due in April and November 2017 equal to $2.8 billion.
  • In recent months, the Venezuelan government has repeatedly denounced what it has termed a “financial blockade” by international banks and rating agencies, which it says refuse to renegotiate the terms of debt payments and exaggerate risk ratings despite the country’s pristine payment record. In August, Citibank unexpectedly resigned as pay agent for PDVSA’s bonds in an unusual move that analysts have attributed to the possible influence of the United States government.
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  • While Venezuela’s foreign reserves have fallen to a new low of $11.8 billion, rising oil prices could yield the government an additional $2.5 billion in revenue this year, reports Financial Times.
Paul Merrell

CorpWatch : "Alchemy" Investigation Alleges Wall Street Fraud at Standard & P... - 0 views

  • On Monday, the U.S. Department of Justice sued S&P for $5 billion for misleading the Western Federal Corporate Credit Union, the first federally chartered credit union, which collapsed in 2008.  Sixteen states have joined the lawsuit while the U.S. Securities & Exchange Commission has also launched an investigation. S&P has offered to settle for $100 million instead without admitting any guilt.The lawsuits are based on a special government investigation named “Alchemy” into top ratings provided by S&P for “collateralized debt obligations” (CDOs) composed of sub-prime mortgages. The federal officials allege that analysts knew that the loans were likely to go sour.
  • Two dozen government lawyers spent several years, conducting over 150 interviews, to find out how much the ratings agency knew about the quality of the CDOs. Some of the documents they uncovered were pretty damning.“This market is a wildly spinning top which is going to end badly,” wrote David Tesher, an S&P managing director in an email on December 11, 2006, according to documents released by the government. “Let’s hope we are all wealthy and retired by the time this house of cards falters,” another S&P employee wrote four days later, according to documents released by the U.S. Senate."Watch out // Housing market went softer // Cooling down // Strong market is now much weaker // Subprime is boi-ling o-ver // Bringing down the house,” sang an analyst in a parody video of Talking Heads' 1983 song "Burning Down the House" that he recorded for his colleagues in March 2007.
  • “Claims that we deliberately kept ratings high when we knew they should be lower are simply not true. S.&P. has always been committed to serving the interests of investors and all market participants by providing independent opinions on creditworthiness based on available information,” the Wall Street firm said in a statement released to the press.S&P has also tried to claim in court that its ratings are protected under the first amendment to the U.S. constitution, which guarantees the right to free speech. Federal judges have been skeptical like Shira A. Scheindlin, who recently ruled against the argument.
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  • Other lawsuits have also uncovered evidence that Wall Street firms were aware of the problems with sub-prime loans as far back as 2005, according to documents just released in a New York court under a lawsuit against Morgan Stanley, a major U.S. investment bank, that was brought by the China Development Industrial Bank (CDIB) from Taiwan.  The bankers cracked jokes about the quality of the CDO that they sold to the Taiwanese suggesting that it should be called “Subprime Meltdown,” “Hitman,” “Nuclear Holocaust” and “Mike Tyson’s Punchout” or “Shitbag.”
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    From February 2013.
Paul Merrell

Moody's downgrades 4 US giant lenders - RT Business - 0 views

  • Moody’s is to cut the credit rating of US major banks, including Morgan Stanley, Goldman Sachs, JPMorgan and Bank of New York Mellon. The rating agency thinks the government is now less likely to support the lenders in times of new financial difficulties. The debt rating of the holding company of Goldman Sachs was cut from A3 to Baa1, JPMorgan - from A2 to A3, Morgan Stanley - from Baa1 to Baa2, and Bank of New York Mellon -  from Aa3 to A1.
  • "We believe that US bank regulators have made substantive progress in establishing a credible framework to resolve a large, failing bank," said Robert Young, the Moody’s Managing Director. "Rather than relying on public funds to bail-out one of these institutions, we expect that bank holding company's creditors will be bailed-in and thereby shoulder much of the burden to help recapitalize a failing bank." Lower credit rating can cost the lenders a higher loan price, increasing their financial burden. However the bank executives complained about unfairly assessed downgrades, and optimism overcompensation, the Financial Times reported. The review is similar to one by Standard & Poor's in June and comes from government’s unwillingness to repeat bailouts in a crisis.
  • The decision was made after the ratings of eight American banks, including Citigroup, Bank of America, Wells Fargo and State Street were placed on revision in August, when more details of government’s intention to abandon banks support were unveiled.
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    So Moody's thinks Cyprus like bail-ins for large failing U.S. banks are more likely than government bail-outs and names the large banks most likely to fail, with their projected likelihood to fail reflected in Moody's adjusted credit ratings. For those who don't understand what a "bail-in" is, it means that the bank gets your deposits and you get back a bit of ownership in a failing enterprise. Try to spend that. 
Paul Merrell

Prime Minister Tsipras' Bailout Reform Package: An Act of Treason against the Greek Peo... - 0 views

  • After having launched a Referendum to refute and refuse the debt bailout agreement put together by the Troika, Prime Minister Tsipras together with his newly instated Finance Minister, comes up four days latter with an austerity package broadly similar to the one which was turned down by the Greek government in June. This about-turn had been carefully engineered. The Greek people were misled and deceived. The Referendum was an outright  ”ritual of democracy”.  Tsipras had made a deal with the creditors. He was in favor of accepting the demands of the creditors all along.
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    The Greek government, notwithstanding the referendum vote against austerity, buckles to what the banksters want. So no Grexit. A must-read.
Paul Merrell

Britain takes axe to spending in new austerity drive - Yahoo News - 0 views

  • British finance minister George Osborne unveiled fresh austerity measures Wednesday to slash debt, evoking the plight of crisis-hit Greece in the first purely Conservative budget for almost two decades. Chancellor of the Exchequer Osborne drastically cut welfare spending to honour campaign promises to forge ahead with austerity, which saw his centre-right Conservative party sweep to an unexpected majority in a May general election and return David Cameron as prime minister.Speaking to lawmakers in his post-election budget statement to parliament, Osborne said welfare spending would be slashed by an accumulated total of £12 billion ($18.4 billion, 16.6 billion euros) by the end of parliament in five years' time. At the same time, the government will introduce a "national living wage" that could reach £9.0 an hour by 2020 that will apply to workers only aged 25 and over. That compares with the current national minimum wage of £6.50 an hour for those aged 21 and over, which will continue to exist alongside the "living wage."
  • n all, the government plans to save £37 billion over the next five years: £12 billion from welfare cuts, £5 billion from tax changes and reducing evasion, and the rest largely from cuts to government departments, Osborne said.
  • Osborne confirmed there would be no change to income tax thresholds or value added taxation (VAT) for at least five years.Corporation tax, levied on business profits, will be reduced from 20 percent to 19 percent in 2017 and 18 percent by 2020.
Paul Merrell

Luxembourg: a tax haven by any other name? | nsnbc international - 0 views

  • The revelations that global and multinational businesses have been brokering “secret” tax deals with Luxembourg to avoid paying taxes in their home countries, may be the first time an entire country has been implicated in tax avoidance collusion. A cache of leaked agreements uncovered by the International Consortium of Investigative Journalism (ICIJ) appears to show that major companies have used the tiny EU state to dramatically cut their tax liabilities.
  • The ICIJ’s six-month investigation claims to have found household companies such as Aviva, HSBC, E-on, Tyco, Pepsi, IKEA and Deutsche Bank were among those which had taken advantage of legal tax avoidance schemes in Luxembourg. Luxembourg is routinely named as a tax haven on many of the world’s authoritative lists of tax havens, including the one compiled by me and my two co-authors, Richard Murphy and Christian Chavagneux. But Luxembourg has managed to remain “under the radar” not least because its politicians and bankers have been denying for years that it is, or ever was, a tax haven. The revelations suggest Luxembourg has been playing a double game. Luxembourg has been quick to comply with new regulations proposed by the Organisation for Economic Co-operation and Development (OECD) and the EU. In 2011, the OECD global forum on transparency and exchange of information commended Luxembourg for introducing new rules governing banking information or information protected by secrecy rules.
  • But at the same time, the revelations show that 340 well-known foreign companies have entered into secret agreements with the Luxembourg authorities, brokered by the accounting firm PricewaterhouseCoopers. To take a random example that applies for many of these companies, the ICIJ have a letter to the Luxembourg tax administration written on a PwC letterhead, where FedEx lays down its plan to set up a limited liability company as a tax resident in Luxembourg – so subject in principle to Luxembourg’s corporate income tax. The letter then provides details of a proposed shareholding arrangement that will ensure, I quote, that “neither that Fedex SCS nor its shareholders will be subject to corporate income tax, Municipal Business Tax and Net Wealth tax in Luxembourg”. The letter implies that Luxembourg will serve in effect as a tax haven for Fedex.
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  • There have been a number of other highly publicised tax evasion and avoidance cases recently. For instance, many cases in the US involved branches or even key individuals working in branches of well-known Swiss and Israeli banks in the US, including UBS, Credit Swiss or Bank Leumi, or alternatively branches of American banks in Switzerland. But these tended to involve private firms. The Swiss government professed to have had no knowledge of such activities. Indeed, Swiss law prohibited Swiss banks, whether domestic or international, from providing any information on their clients to the Swiss state. This is a scandal with a difference. The leaked PricewaterhouseCoopers books imply there has been systemic collusion between companies from all over the world and the Luxembourg authorities in flagrant contravention of EU rules. The documents suggest that preferential tax treatments were guaranteed to these companies prior to their incorporation in Luxembourg.
  • This is the first case of suspected collusion between a government and a foreign firm in tax avoidance matters that I am aware of. In that sense, the current scandal places Luxembourg on par with Greece whose officials allegedly provided misleading data on Greek national debt to the Commission. More embarrassingly, all this took place during the time when the current president of the European Commission, Jean-Claude Juncker, served as the prime minister of Luxembourg from 1995-2013. It is difficult to imagine that the prime minister of such a small state was unaware such deals were taking place. There is a difference between the court of law and the court of public opinion. But we know from recent cases that the EU Commission has tended to follow the court of public opinion with criminal investigations of its own, as was the case of Amazon. It is likely that the Commission will now investigate these leaks and may impose fines on Luxembourg. I doubt Juncker can ride this one out.
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    Woo-hoo! The IRS and Congress will be interested in this one too.  Now if someone would kindly send the docs to Wikileaks, the nations of the world can prosecute companies for tax evasion. But this time, would you all, pretty please, prosecute some human beings too and no settlements without at least a couple of years behind bars?
Paul Merrell

Iceland Stuns Banks: Plans To Take Back The Power To Create Money | Global Research - C... - 0 views

  • Who knew that the revolution would start with those radical Icelanders? It does, though. One Frosti Sigurjonsson, a lawmaker from the ruling Progress Party, issued a report today that suggests taking the power to create money away from commercial banks, and hand it to the central bank and, ultimately, Parliament. Can’t see commercial banks in the western world be too happy with this. They must be contemplating wiping the island nation off the map. If accepted in the Iceland parliament , the plan would change the game in a very radical way. It would be successful too, because there is no bigger scourge on our economies than commercial banks creating money and then securitizing and selling off the loans they just created the money (credit) with. Everyone, with the possible exception of Paul Krugman, understands why this is a very sound idea. Agence France Presse reports: Iceland Looks At Ending Boom And Bust With Radical Money Plan Iceland’s government is considering a revolutionary monetary proposal – removing the power of commercial banks to create money and handing it to the central bank. The proposal, which would be a turnaround in the history of modern finance, was part of a report written by a lawmaker from the ruling centrist Progress Party, Frosti Sigurjonsson, entitled “A better monetary system for Iceland”.
  • “The findings will be an important contribution to the upcoming discussion, here and elsewhere, on money creation and monetary policy,” Prime Minister Sigmundur David Gunnlaugsson said. The report, commissioned by the premier, is aimed at putting an end to a monetary system in place through a slew of financial crises, including the latest one in 2008.
  • According to a study by four central bankers, the country has had “over 20 instances of financial crises of different types” since 1875, with “six serious multiple financial crisis episodes occurring every 15 years on average”. Mr Sigurjonsson said the problem each time arose from ballooning credit during a strong economic cycle. He argued the central bank was unable to contain the credit boom, allowing inflation to rise and sparking exaggerated risk-taking and speculation, the threat of bank collapse and costly state interventions. In Iceland, as in other modern market economies, the central bank controls the creation of banknotes and coins but not the creation of all money, which occurs as soon as a commercial bank offers a line of credit. The central bank can only try to influence the money supply with its monetary policy tools.
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  • Under the so-called Sovereign Money proposal, the country’s central bank would become the only creator of money. “Crucially, the power to create money is kept separate from the power to decide how that new money is used,” Mr Sigurjonsson wrote in the proposal. “As with the state budget, the parliament will debate the government’s proposal for allocation of new money,” he wrote. Banks would continue to manage accounts and payments, and would serve as intermediaries between savers and lenders. Mr Sigurjonsson, a businessman and economist, was one of the masterminds behind Iceland’s household debt relief programme launched in May 2014 and aimed at helping the many Icelanders whose finances were strangled by inflation-indexed mortgages signed before the 2008 financial crisis.
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    In closely related news, a Pentagon spokesman announced that soldiers of the U.S. Army's 101st Airborne Brigade and 22nd and 26th Marine Expeditionary Units were in the "mopping up stage" of routing terrorists who had captured the city of Reykjavík, Iceland in an April 7, 2015 surpise attack. According to knowledgeable sources in the White House, the terrorist invasion was reported by an unidentified official of the Federal Reserve Bank of New York, who had received urgent telephone calls from counterparts in Iceland's central bank. "We're still assessing the situation, but it looks like all members of the Icelandic government were brutally executed by the terrorists just before they retreated," Rear Adm. John Kirby said. Asked for the name of the terrorist organization that carried out the attack, Adm. Kirby said that the name had not yet been declassified, but said that he hoped to be able to announce that information soon.     
Paul Merrell

How Much Is Donald Trump Worth? An Examination Of The Evidence | ThinkProgress - 0 views

  • How much money does Donald Trump actually have? Trump’s image as a savvy, deal-making, and, most importantly, fabulously wealthy businessman isn’t just about his personal brand. He’s made it a key selling point for his presidential campaign as he’s run to be the Republican Party’s nominee. “I’m really rich,” he assured voters as he launched his run for president. That message was intended to convey not only that he doesn’t “need anybody’s money” to fuel his campaign but also that he will help create wealth for everyone. “We’re going to make America wealthy again,” he’s promised his supporters. “I will give you everything.” He pledges to Make America Great Again, but also explained that “you have to be wealthy in order to be great, I’m sorry to say.” Yet the nominee has also refused to release his tax returns, which would tell the public exactly how much money he has. He’s maintained that he’s worth more than $10 billion. But he’s also become known for a slippery relationship with the truth, and there’s a pile of evidence to indicate that he may be worth a lot less than that. (Neither the Trump Organization nor the Trump campaign responded to a request for comment on this evidence or on whether he will be releasing his tax returns.)
  • It’s difficult to get a handle on the more than 500 businesses Trump owns, plus other potential investments and sources of wealth, without him disclosing them himself. Even then, much of the valuation rests on what import one gives to the Trump brand itself and how to adequately assess the worth of his various real estate holdings. Financial media outlets have estimated what they think the mogul is worth, but none have ever come close to backing Trump’s claim of $10 billion. When Bloomberg ran a tally this week of all of his major assets, including stock holdings and the value of properties like golf courses and luxury towers, it came up with $3 billion. Forbes, after interviews with 80 sources and a piece by piece look at Trump’s empire, concluded $4.5 billion. The Bloomberg analysis, however, relies at least in part on statements Trump himself made in financial disclosure forms, while Forbes has always had to rely on information given by the Trump Organization — and Forbes has admitted that Trump consistently pushes for a higher valuation. Fortune also caught him conflating revenue and income in his campaign filing reports and thereby significantly inflating how much income he says he has. In other places, Trump has submitted information on forms that would revise his wealth significantly downward. As Crain’s reported in March, Trump got a break in his latest property tax bill for Trump Tower in New York City that is only available to married couples who have an annual income of $500,000 or less.
  • The trend of publicly boasting about his money and then privately swearing that his assets are worth less goes pretty far back. In 1988, Trump a told Forbes that his personal residences were worth $50 million, but he said in sworn statements that they were in fact a net liability because the debt load was more than they were worth. In 1989, while Trump insisted that he was worth between $4 and $5 billion, Forbes obtained records he had submitted to a government body that his assets were only worth $1.5 billion. In 2005, a bank evaluated his net worth to be $788 million when underwriting a construction loan for some of his real estate projects — a time when Trump claimed his worth was more like $3.6 billion. lost the lawsuit.)
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    Gary Johnson and Jill Stein are starting to look awfully good. "If God had wanted us to vote, he would have given us candidates." -- Jay Leno.
Paul Merrell

Can Greece and EU Make Amends? | Consortiumnews - 0 views

  • As German Chancellor Angela Merkel has said, loans must be repaid. In principle, of course, she is right, but there are extenuating circumstances, including that the lenders baited the trap in which the Greeks have fallen. The lenders offered loans when they should have known that the borrowers had little chance of repaying them.Sometimes in Greece – as, for example, in Latin America – bank officers encouraged borrowing because they got bonuses for generating business, a common banking practice. Other loans were made for political purposes. Some also had “security” aspects.Collectively, the Greeks are “guilty” of accepting the loans. They should have known how hard it would be to repay them. Some, prudently, refused, but when the loans temporarily created a minor boom, almost everyone was swept up in the euphoria.
  • And the Greeks were not alone. Other heavy borrowers included the governments and peoples of Spain, Portugal, Italy and Ireland. This is what makes the current crisis more than just a Greek problem.Internationally, there are already signs that lenders are reacting to the Greek vote in panic. If one country that borrowed heavily is defaulting, they ask, which other heavily-borrowing country is likely to be next? Many have suggested it will be Spain. Apparently a number of lenders believe that popular Spanish movements resemble the coalition of groups supporting Greek Prime Minister Alexis Tsipras’s Syriza. The bankers may not particularly care about the politics or ideology, but they fear the turmoil.Bankers are usually noted for their prudence (especially when the risks of non-payment are readily apparent). And prudence argues for either making no new loans or even calling in those already made. This could dramatically harm the Spanish economy where already in this year nearly one in four workers could not find a job.So, it’s clear that the time of danger is here. What about the time for statesmanship? Ironically, the lenders do not seem to have yet understood that the “No” vote could save the Euro, save Greece – and potentially save Spain, Italy, Portugal and Ireland. Why is that so?
  • It is so because having secured his support at home, Prime Minister Tsipras can now afford to negotiate a sensible deal. And, having seen that Tsipras survived what amounted to a vote-of-no-confidence and would have meant his political removal if he had lost, Chancellor Merkel and French President Francois Hollande now realize that they must negotiate a sensible deal with Tsipras if they are to save the Euro and potentially the European Union.What would be the basis of a compromise? While there are details of considerable complexity, the heart of the matter is reasonably simple:First, Greece cannot repay the huge debt in the foreseeable future. That would have been true even if the Greeks had voted “yes.” Put starkly, the IMF, the European Central Bank and other creditors must forgive a large part of the Greek debt. They probably will choose to disguise “forgiveness” by calling it an extension into the remote future.
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  • Second, if Greece is to survive in some acceptable manner – and possibly even avoid a civil war – the country will need additional emergency financing. Tsipras’s electoral victory will make it possible for him to bend slightly – but not much – on such issues as welfare payments.At the same time,  public desperation – as funds dry up and even food becomes scarce – will impel him to compromise as much as he can to stay in office. Meanwhile, the lenders will find strong incentives to help because a total collapse of the Greek economy raises the specter of collapse in other European Union economies and the ultimate danger of the splintering of the European Union and the collapse of the Euro.
Gary Edwards

The 6 Grand Illusions That Keep Us Enslaved to the Matrix - 0 views

  • Bansky, the revered and elusive revolutionary street artist, once commented: “People are taking the piss out of you everyday. They butt into your life, take a cheap shot at you and then disappear. They leer at you from tall buildings and make you feel small. They make flippant comments from buses that imply you’re not sexy enough and that all the fun is happening somewhere else. They are on TV making your girlfriend feel inadequate. They have access to the most sophisticated technology the world has ever seen and they bully you with it. They are The Advertisers and they are laughing at you.” – Banksy  Advertising is just the tip of the iceberg. When we look further we see that the overall organization of life is centered around the pursuit of illusions and automatic obedience to institutions and ideas which are not at all what they seem. We are in a very real sense enslaved. Many call this somewhat intangible feeling of oppression ‘the matrix,’ a system of total control that invades the mind, programming individuals to pattern themselves in accordance with a mainstream conformist version of reality, no matter how wicked it gets. The grandest of the illusions which keep us enslaved to the matrix, the ones that have so many of us still entranced, are outlined below for your consideration.
  • 1. The Illusion of Law, Order and Authority For so many of us, following the law is considered a moral obligation, and many of us gladly do so even though corruption, scandal, and wickedness repeatedly demonstrate that the law is plenty flexible for those who have the muscle to bend it. Police brutality and police criminality is rampant in the US, the courts favor the wealthy, and we can longer even lead our lives privately thanks to the intrusion of state surveillance. And all the while the illegal and immoral Orwellian permanent war rages on in the background of life, murdering and destroying whole nations and cultures. The social order is not what it seems, for it is entirely predicated on conformity, obedience and acquiescence which are enforced by fear of violence. History teaches us again and again that the law is just as often as not used as an instrument of oppression, social control and plunder, and any so-called authority in this regard is false, hypocritical, and unjust. When the law itself does not follow the law, there is no law, there is no order, and there is no justice. The pomp and trappings of authority are merely a concealment of the truth that the current world order is predicated on control, not consent.
  • 2. The Illusion of Prosperity and Happiness Adorning oneself in expensive clothes and trinkets, and amassing collections of material possessions that would be the envy of any 19th century monarch has become a substitute for genuine prosperity. Maintaining the illusion of prosperity, though, is critical to our economy as it is, because its foundation is built on consumption, fraud, credit and debt. The banking system itself has been engineered from the top down to create unlimited wealth for some while taxing the eternity out of the rest of us. True prosperity is a vibrant environment and an abundance of health, happiness, love, and relationships. As more people come to perceive material goods as the form of self-identification in this culture, we slip farther and farther away from the experience of true prosperity.
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  • 3. The Illusion of Choice and Freedom Read between the lines and look at the fine print, we are not free, not by any intelligent standard. Freedom is about having choice, yet in today’s world, choice has come to mean a selection between available options, always from within the confines of a corrupt legal and taxation system and within the boundaries of culturally accepted and enforced norms. Just look no further than the phony institution of modern democracy to find a shining example of false choices appearing real. Two entrenched, corrupt, archaic political parties are paraded as the pride and hope of the nation, yet third party and independent voices are intentionally blocked, ridiculed and plowed under. The illusion of choice and freedom is a powerful oppressor because it fools us into accepting chains and short leashes as though they were the hallmarks of liberty. Multiple choice is different than freedom, it is easy servitude.
  • 4. The Illusion of Truth Truth has become a touchy subject in our culture, and we’ve been programmed to believe that ‘the‘ truth comes from the demigods of media, celebrity, and government. If the TV declares something to be true, then we are heretics to believe otherwise. In order to maintain order, the powers that be depend our acquiescence to their version of the truth. While independent thinkers and journalists continually blow holes in the official versions of reality, the illusion of truth is so very powerful that it takes a serious personal upheaval to shun the cognitive dissonance needed to function in a society that openly chases false realities.
  • 5. The Illusion of Time They say that time is money, but this is a lie. Time is your life. Your life is an ever-evolving manifestation of the now. Looking beyond the five sense world, where we have been trained to move in accordance with the clock and the calendar, we find that the spirit is eternal, and that the each individual soul is part of this eternity. The big deception here is the reinforcement of the idea that the present moment is of little to no value, that the past is something we cannot undo or ever forget, and that the future is intrinsically more important than both the past and the present. This carries our attention away from what is actually happening right now and directs it toward the future. Once completely focused on what is to come rather than what is, we are easy prey to advertisers and fear-pimps who muddy our vision of the future with every possible worry and concern imaginable. We are happiest when life doesn’t box us in, when spontaneity and randomness gives us the chance to find out more about ourselves. Forfeiting the present moment in order to fantasize about the future is a trap. The immense, timeless moments of spiritual joy that are found in quiet meditation are proof that time is a construct of the mind of humankind, and not necessarily mandatory for the human experience. If time is money, then life can be measured in dollars. When dollars are worth less, so is life. This is total deception, because life is, in truth, absolutely priceless.
  • 6. The Illusion of Separateness On a strategic level, the tactic of divide and conquer is standard operating procedure for authoritarians and invading armies, but the illusion of separateness runs even deeper than this. We are programmed to believe that as individuals we are in competition with everyone and everything around us, including our neighbors and even mother nature. Us vs. them to the extreme. This flatly denies the truth that life on this planet is infinitely inter-connected. Without clean air, clean water, healthy soil, and a vibrant global sense of community we cannot survive here. While the illusion of separateness comforts us by gratifying the ego and and offering a sense of control, in reality it only serves to enslave and isolate us.
  • Conclusion The grand illusions mentioned here have been staged before us as a campaign to encourage blind acquiescence to the machinations of the matrix. In an attempt to dis-empower us, they demand our conformity and obedience, but we must not forget that all of this is merely an elaborate sales pitch. They can’t sell what we don’t care to buy.
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    "SOURCE: SIGMUND FRAUD, WAKING TIMES "In prison, illusions can offer comfort." - Nelson Mandela For a magician to fool his audience his deceit must go unseen, and to this end he crafts an illusion to avert attention from reality. While the audience is entranced, the deceptive act is committed, and for the fool, reality then becomes inexplicably built upon on a lie. That is, until the fool wakes up and recognizes the truth in the fact that he has been duped. Maintaining the suspension of disbelief in the illusion, however, is often more comforting than acknowledging the magician's secrets. We live in a world of illusion. So many of the concerns that occupy the mind and the tasks that fill the calendar arise from planted impulses to become someone or something that we are not. This is no accident. As we are indoctrinated into this authoritarian-corporate-consumer culture that now dominates the human race, we are trained that certain aspects of our society are untouchable truths, and that particular ways of being and behaving are preferred.  Psychopaths disempower people in this way. They blind us with never ceasing barrages of suggestions and absolutes that are aimed at shattering self-confidence and confidence in the future.  "
Gary Edwards

Looting: When Government guarantees the cost of failure, Looters profit : Too Big To F... - 0 views

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    The theory of "Looting" explains many of the financial crisis of the past and present. Perhaps too too many! This article introduces a white paper , "Looting". The authors argue that multiple financial crises can be explained by this phenomenon, including the belief that a financial institution and entangled "counterparty" is too big to fail. " .... an economic underground can come to life if firms have an incentive to go broke for profit at society's expense (to loot) instead of to go for broke (to gamble on success). Bankruptcy for profit will occur if poor accounting, lax regulation, or low penalties for abuse give owners an incentive to pay themselves more than their firms are worth and then default on their debt obligations...."
Gary Edwards

Paul Ryan -- the Man Who Could Save America - Casey Research - 0 views

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    incredible plan!  This article is a quick synopsis of the comprehensive, but "short" plan Republican representative Paul Ryan introduced to Congress in 2009.  It covers everything.  And if ever there was a Conservative Manifesto, this is the nuts and bolts of how to get it done.  Unbelievable.  
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