Could These 3 Simple Changes to Banking Fix the Economy? 'The Corrupt Banking System' by Victoria Grant. Chicago Fed Study Blasts the Lid Off of High Frequency Trading. We hear all sorts of reasons why the little guy won't buy stocks these days but the below graph, courtesy of a Chicago Fed study, might explain a lot of it. The above chart shows an astounding percentage of market trades going through no human involved trading systems known as high frequency trading. The Chicago Federal Reserve paper, How to Keep Markets Safe in the Era of High-Speed Trading, prattled off a laundry list of the most recent high frequency trading debacles including Knight Capital as well as others. Yet in spite of these increasingly frequent stock market disasters, even basic risk controls are not implemented. Why? They claim it would slow down their trading systems. Industry and regulatory groups have articulated best practices related to risk controls, but many firms fail to implement all the recommendations or rely on other firms in the trade cycle to catch an out-of-control algorithm or erroneous trade.
The Chicago Fed does give some recommendations in their report: Ron Paul: Iceland Dismantles Corrupt Gov't Then Arrests All Rothschild Bankers... Peter Schiff: We aren't that far behind Greece. Corporations are primarily intellectual property rentiers. Gavin Mueller has a great article in the summer issue of Jacobin Magazine about piracy, and at one point drops this jaw-dropping statistic: “Intellectual property makes up 80 percent of the net worth of US corporations and 60 percent of their exports.”
I ran the statistic down and found that it apparently originated from an FTC report called The Evolving IP Marketplace. This is an incredible statistic for a number of reasons, but the biggest one is that it strikes at the core of American economic mythology. We like to think of the US economy as one driven by private enterprise that is independent of government help. Leftists often point out that the independence from government is an illusion: government investment plays a significant role in the economy and, more fundamentally, property ownership and contract enforcement are government creations.
Obama's top 5 contributors are the University of California, Microsoft, Google, DLA Piper and Harvard University. Romney's top 5 contributors are Goldman Sachs, JP Morgan, Morgan Stanley, Bank of America and Credit Suisse. : politics. Banks in Libor Inquiry Are Said to Be Trying to Spread Blame. Paul Thomas/Bloomberg NewsRobert E. Diamond Jr., the former chief of Barclays. Major banks, which often band together when facing government scrutiny, are now turning on one another as an international investigation into the manipulation of interest rates gains momentum. With billions of dollars and their reputations on the line, financial institutions have been spreading the blame in recent meetings with authorities, according to government and bank officials with knowledge of the matter.
While acknowledging their own wrongdoing, institutions are pointing out actions at other banks that they believe are worse — and in some cases, extend to top executives. One official involved in the case said that banks are emphasizing that “we’re not as bad as the next guy.” When the British bank Barclays recently negotiated a settlement with authorities, it highlighted that other European institutions took part in the rate-rigging scheme, said officials close to the case. MY2iA.jpg (1013×5581) From an Unlikely Source, a Serious Challenge to Wall Street | Matt Taibbi. It's over for the banking cabal. 4.jul.2012. "A Global Perfect Storm" by Nouriel Roubini. Exit from comment view mode. Click to hide this space NEW YORK – Dark, lowering financial and economic clouds are, it seems, rolling in from every direction: the eurozone, the United States, China, and elsewhere.
Indeed, the global economy in 2013 could be a very difficult environment in which to find shelter. For starters, the eurozone crisis is worsening, as the euro remains too strong, front-loaded fiscal austerity deepens recession in many member countries, and a credit crunch in the periphery and high oil prices undermine prospects of recovery. Moreover, fiscal and sovereign-debt strains are becoming worse as interest-rate spreads for Spain and Italy have returned to their unsustainable peak levels. Farther to the west, US economic performance is weakening, with first-quarter growth a miserly 1.9% – well below potential. Moreover, political gridlock over fiscal adjustment is likely to persist, regardless of whether Barack Obama or Mitt Romney wins November’s presidential election.
Young Wall Street Traitor Joins Occupy Wall Street. Wall Street “Quant” Alexis Goldstein joins the opposition Wall Street recruits young, just out of college computer science majors and mathematicians to become “quants” whose skills are used among other things to predict when pension funds are going to make huge trades so that Wall Street can jump in ahead of them and do deals effectively raising the price the pension fund must pay or lowering the profit they might make. One such young twenty something quant was Alexis Goldstein. Goldstein devised trading software for Deutsche Bank and Merrill Lynch. She has divulged some of Wall Street’s most closely held cultural secrets such as the phrase “rip the client’s face off” which means selling some derivative “solution” to a naive client such as a convent of nuns in Europe at a huge profit to the trader and to Wall Street while convincing the client that it’s the best deal they ever made.
One of the highly touted products was an interest rate swap. And it wasn’t just in Europe. Iceland proves that bailing out the middle class works better than bailing out banks - The Young Turks with Cenk Uygur. To Our Faithful Current.com Users: Current's run has ended after eight exciting years on air and online. The Current TV staff has appreciated your interest, support, participation and unflagging loyalty over the years.
Your contributions helped make Current.com a vibrant place for discussing thousands of interesting stories, and your continued viewership motivated us to keep innovating and find new ways to reflect the voice of the people. We now welcome the on-air and digital presence of Al Jazeera America, a new news network committed to reporting on and investigating real stories affecting the lives of everyday Americans in every corner of the country. Thank you for inspiring and challenging us. . – The Current TV Staff. Out of the Mouths of Babes: Twelve-Year-Old Money Reformer Tops a Million Views. The youtube video of 12 year old Victoria Grant speaking at the Public Banking in America conference last month has gone viral, topping a million views on various websites. Monetary reform—the contention that governments, not banks, should create and lend a nation’s money—has rarely even made the news, so this is a first. Either the times they are a-changin’, or Victoria managed to frame the message in a way that was so simple and clear that even a child could understand it.
Basically, her message was that banks create money “out of thin air” and lend it to people and governments at interest. If governments borrowed from their own banks, they could keep the interest and save a lot of money for the taxpayers. She said her own country of Canada actually did this, from 1939 to 1974. During that time, the government’s debt was low and sustainable, and it funded all sorts of remarkable things. Only when the government switched to borrowing privately did it acquire a crippling national debt. How the "Job Creators" REALLY Spend Their Money. In his "Gospel of Wealth," Andrew Carnegie argued that average Americans should welcome the concentration of wealth in the hands of a few, because the "superior wisdom, experience, and ability" of the rich would ensure benefits for all of us. More recently, Edward Conard, the author of "Unintended Consequences: Why Everything You've Been Told About the Economy Is Wrong, said: "As a society, we're not offering our talented few large enough rewards.
We're underpaying our 'risk takers.'" (Photo: farm4.static.flickr.com) Does wealthy America have a point, that giving them all the money will ensure it's disbursed properly, and that it will create jobs and stimulate small business investment while ultimately benefiting society? They don't cite evidence for their claims, because the evidence proves them wrong. The Very Rich Don't Like Making Risky Investments The Mendelsohn Affluent Survey confirmed that the very rich spend less than two percent of their money on new business startups. The Austerity Agenda. “The boom, not the slump, is the right time for austerity.” So declared John Maynard Keynes 75 years ago, and he was right.
Even if you have a long-run deficit problem — and who doesn’t? — slashing spending while the economy is deeply depressed is a self-defeating strategy, because it just deepens the depression. GOP presidential candidate Mitt Romney and Rep. So why is Britain doing exactly what it shouldn’t? Over the past few days, I’ve posed that question to a number of supporters of the government of Prime Minister David Cameron, sometimes in private, sometimes on TV. The austerity drive in the UK is all "about using deficit panic as an excuse to dismantle social programs. The bad metaphor — which you’ve surely heard many times — equates the debt problems of a national economy with the debt problems of an individual family. The answer is that an economy is not like an indebted family. So what happens if everyone simultaneously slashes spending in an attempt to pay down debt? 84% of All Stock Trades Are By High-Frequency Computers … Only 16% Are Done By Human Traders.
Lifting the Veil - A New World Society. Don't Tax the Rich, Smash Their Privilege: A Response to Warren Buffett. Recently the progressive blogosphere was abuzz with approving links to billionaire investor Warren Buffett's latest New York Times op-ed, "Stop Coddling the Super Rich. " In this piece, Buffett concisely exposes the various loopholes that allow the wealthiest Americans to pay far fewer taxes than their middle class, working class, and poor counterparts. While the tax code in all its complexity certainly privileges the wealthy at the expense of most Americans, this barely scratches the surface of the ways the state oppresses poor and working people to line the pockets of the opulent. Buffett's article never mentions direct corporate welfare or the numerous privileges that the wealthy hold thanks to intellectual property, the land monopoly, regulatory barriers to entry, suppression of labor movements, and imperialism, to name a few.
Coca Cola, Human Rights, and Labor Suppression Such campaigns of violent intimidation have been aided and abetted by US tax dollars. Five Reasons Why The Very Rich Have NOT Earned Their Money. The wealthiest Americans believe they've earned their money through hard work and innovation, and that they're the most productive members of society. For the most part they're wrong. As the facts below will show, they're not nearly as productive as middle-class workers. Yet they've taken almost all the new income over the past 30 years. (Image: Flickr by IronRodArt) Any one of these five reasons should reinforce the belief that the rich should be paying a LOT more in taxes. 1.
They've Taken All the Middle Class Wage Increases In 1980 the richest 1% of America took one of every fifteen post-tax income dollars. For every dollar the richest 1% earned in 1980, they've added three more dollars. Yet the average American factory worker, according to Berkeley economist Enrico Moretti, produces $180,000 worth of goods a year, more than three times what he or she produced in 1978, in inflation-adjusted dollars. 2. We have the most expensive health care system in the world. 3. 4. 5. Buttonwood: Marginal improvement. "Captured Europe" by Simon Johnson. Exit from comment view mode. Click to hide this space WASHINGTON, DC – Europe’s policy elite – the people who call the shots at the national and eurozone level – are in serious trouble.
They have mismanaged their way into a deep crisis, betraying all of the lofty promises of unity and prosperity issued when the euro was created. The currency union may survive, but, for millions of people, the euro has already failed in its mission of sustaining growth and ensuring stability. The Greek, Portuguese, Irish, and Italian economies are reeling under fiscal austerity – with budget cuts and higher taxes as far as the eye can see. But that is only part of the problem. There is a simple way to deal with a debt overhang: reduce payments by restructuring the debt. In both cases, the main argument for not removing the debt overhang came from bankers, who claimed that it would create havoc in financial markets for two reasons.
Did all hell break loose? Market exchange rules responsible for wealth concentration, physicists say. Two Brazilian physicists have shown that wealth concentration invariably stems from a particular type of market exchange rules -- where agents cannot receive more income than their own capital. The authors concluded that maximum inequalities ensue from free markets, which are governed by such seemingly fair rules.
This study, published in European Physical Journal B, was conducted by J. Roberto Iglesias and Rita de Almeida from the Brazilian National Institute of Science and Technology of Complex Systems, based in Porto Alegre. This Brazilian city is famous for hosting the World Social Forum, which is designed to find alternatives to economic liberalism. To study free market models, the authors used statistical mechanics methods focusing on the dynamic of wealth exchange over time. As a result, the free market is stalled with no subsequent possible exchanges of wealth, even if wealth were distributed evenly from the start.
Americans Will Need “Black Markets” To Survive. As Americans, we live in two worlds; the world of mainstream fantasy, and the world of day-to-day reality right outside our front doors. One disappears the moment we shut off our television. The other, does not… When dealing with the economy, it is the foundation blocks that remain when the proverbial house of cards flutters away in the wind, and these basic roots are what we should be most concerned about. While much of what we see in terms of economic news is awash in a sticky gray cloud of disinformation and uneducated opinion, there are still certain constants that we can always rely on to give us a sense of our general financial environment. Two of these constants are supply and demand.
In contrast, the establishment does have the ability to make specific demands or necessities illegal to possess, and can even attempt to restrict their supply. But, what happens when black markets, due to calamity, become a pillar of survival for a society? I fear for a social explosion: Greeks can't take any more punishment | World news | The Observer. Helena Smith, who has reported from Athens for more than 20 years, says the country is on the edge of a precipice Despair has enveloped Greece.
This weekend the bankrupt nation, for that is what it is, began negotiating the latest act of a drama that many fear will end in catastrophe – financially, socially and politically. In an electric atmosphere, with thousands demonstrating outside parliament, MPs began debating the arduous terms of a €130bn (£110bn) rescue package that the interim prime minister, Lucas Papademos, insists is the only way left to avert economic collapse. "A disorderly default," he said, referring to the 20 March deadline that Greece faces of repaying €14.5bn in maturing debt, "would plunge our country in a disastrous adventure.
It would create conditions of uncontrolled economic chaos and social explosion. " But in both parties MPs are far from convinced. After more than two decades reporting from Athens, I can only concur. "Nothing functions. Greece Euro Lucas Papademos. Why economic inequality leads to collapse | Business | The Observer. Overheard on the Goldman Sachs Elevator. The Big Lie: Wall Street has Destroyed the Wonder That Was America. [1112.3095] Evidence of market manipulation in the financial crisis. Who Really Controls the World? The Size of the Bank Bailout: $29 Trillion - US Business News Blog. Use RICO Act to Prosecute Banks and Corrupt Politicians. G.O.P. Monetary Madness. I Said No to My Student Loan: One Borrower's Decision to Stop Paying. Dwolla. 60 Minutes Exposes Specific Instances of Actionable High-Level Fraud at Citibank and Countrywide - It is being Actively Ignored.
"26 TRILLION Dollars In Bank Bailouts! That's Not Including TARP!" Alan Grayson. Michael Hudson: Debt and Democracy – Has the Link Been Broken? A Banker Speaks, With Regret. What to do when you’ve got money in the bank and you’re worried about a dollar collapse: The Past and Future of Money. Money. Cayman directors: 'next big scandal' for hedge funds - FT. LEAKED MEMO: Wall Street Has A Much Bigger Worry Than Obama. Charts for the “Facts of the Economic Crisis” Column. How "Move Your Money" Could Hurt Wall Street By As Much As $8 TRILLION. Bernard Lietaer: Money diversity. Why isn't the economy more like hydraulics? The Euro Is Doomed: How the Collapse of Italy and Greece Will Destroy the Currency. TURNING THE TABLES ON WALL STREET: NORTH DAKOTA SHOWS CASH-STARVED STATES HOW THEY CAN CREATE THEIR OWN CREDIT.
Now Is the Time for an Economic Bill of Rights. Ten Million Families Sliding Toward Foreclosure. Finally, a Judge Stands up to Wall Street | Matt Taibbi.