Tony Benn: Banks Should Be Publically Owned

Dandelion Salad

AlJazeeraEnglish

Al Jazeera’s Anand Naidoo, standing in for Riz Khan, speaks to Tony Benn, the former British Labour MP and cabinet minister, about his reaction to the G20 summit in London.

Benn discusses whether any of the pledged money will go to poor and developing countries and whether more regulation will really help prevent a financial crisis from happening again.

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Man dies during G20 protests in London (video link)

G20 protests rock London’s financial area + G20 What happened

Man dies during G20 protests in London (video link; updated again)

Dandelion Salad

Update 2: April 8, 2009

Update 1: April 5, 2009

by James Meikle, Paul Lewis, Jenny Percival and Sandra Laville
guardian.co.uk, Thursday 2 April 2009 02.05 BST Continue reading

G20 protests rock London’s financial area + G20 What happened

Dandelion Salad

G20 protests rock London’s financial area – 01 Apr 09

zimobserver

While the differences between the big G20 players were quietly discussed behind closed doors, out on the streets of London there was real anger.

Thousands crowded into London’s financial centre to make their protests heard.

Hamish MacDonald was there. AlJazeeraEnglish

Continue reading

Five youths held under UK Terrorism Act for alleged G20 plot

Dandelion Salad

Stephen C. Webster
The Raw Story
Monday March 30, 2009

Police raided 25-year-old’s home for allegedly spraying ‘antifascist’ graffiti

“Simple fireworks” and “imitation handguns” are all that it took for British authorities to arrest five young activists who allegedly aimed to disrupt the G20 summit.

“The three men, aged 25, 19 and 16, and two women, both 20, all live in Plymouth and the surrounding area,” reported The Guardian. “They are political activists unaffiliated to any terrorist organisation, and were arrested at addresses in Plymouth. They are being held under terrorism legislation. The explosive devices were made from simple fireworks, police said.”

The arrests were made under the UK’s Terrorism Act; a measure which was strongly criticized at its introduction for carrying the potential to “criminalize dissent.”

[…]

via The Raw Story | Five youths held under UK Terrorism Act for alleged G20 plot

FAIR USE NOTICE: This blog may contain copyrighted material. Such material is made available for educational purposes, to advance understanding of human rights, democracy, scientific, moral, ethical, and social justice issues, etc. This constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.

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35,000 protest before G20 meet + G20 Put People First Demonstration

The Economy Sucks and or Collapse 2

35,000 protest before G20 meet + G20 Put People First Demonstration

Dandelion Salad

Vodpod videos no longer available.

more about “35,000 protest before G20 meet“, posted with vodpod

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G20 protesters’ anger amid global recession – 28 Mar 09 Continue reading

British hotels put on alert over Mumbai-style terror attack

Propaganda Alert

compiled by Cem Ertür
Featured Writer
Dandelion Salad
23 March, 2009

1) Hotels put on alert over Mumbai-style terror attack
2) British Interior Minister: UK hotels on high terror alert (January 2009)

________________

http://www.telegraph.co.uk/…

excerpt from: Hotels put on alert over Mumbai-style terror attack (*)

British luxury hotels are vulnerable to Mumbai-style attacks, senior anti-terrorist officers are warning, ahead of a major relaunch of the Government’s counter-terrorism strategy next week.

by Christopher Hope, Daily Telegraph, 21 March 2009

Quote:
Security services officials are also judging the threat against the UK to be at the “severe end of severe”, just days before the G20 summit in London is due to begin.

The Daily Telegraph has learned that senior counter-terrorism officers are highly concerned about the possibility of attacks by terrorists using automatic weapons on major hotels and other public buildings.

This marks a change in the challenge posed to the security services, which have previously focused on preventing bombings.

(*) title of the print version

________________

from the archives:

http://www.thesun.co.uk/sol/homepage/news/article2154541.ece

excerpt from: UK hotels on high terror alert

by Graeme Wilson, The Sun, 21 January 2009

Quote:
Britain is on high alert for a Mumbai-style terrorist attack on a top hotel, Home Secretary Jacqui Smith revealed yesterday.

She told MPs that security chiefs have been training staff at major hotels on how to cope with a terror hit.

Ministers, police and security services are urgently reviewing the UK’s counter-terrorism plans to beef up protection around hotels and other public buildings.

Appearing before the Commons Home Affairs committee, Ms Smith said the atrocities in Mumbai in November — which claimed nearly 200 lives — had triggered an overhaul of Britain’s “protective security arrangements”.

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Please don’t hate us: UK ad campaign to target extremism

MI5 alert on bank riots

Dandelion Salad

By Geraint Jones
Daily Express
Sunday March 1,2009

TOP secret contingency plans have been drawn up to counter the threat posed by a “summer of discontent” in Britain.

The “double-whammy” of the worst economic crisis in living memory and a motley crew of political extremists determined to stir up civil disorder has led to the ­extraordinary step of the Army being put on ­standby.

MI5 and Special Branch are targeting activists they fear could inflame anger over job losses and payouts to failed bankers.

[…]

The “protest season” is due to ­begin on April 1 with the G20 Summit in London next month, followed by the 60th anniversary of Nato in Strasbourg a few days later. May Day is also ­potentially a flashpoint.

Ministers cannot afford to allow ­latent public anger at Government policy to get out of hand if they are to maintain credibility through what promises to be ­Gordon Brown’s most testing period as Prime Minister.

The Stop the War coalition, orchestrating the G20 protest, said: “The first week of April could be a week of world leaders will never forget.”

[…]

via Daily Express | UK News :: MI5 alert on bank riots

h/t: CLG

FAIR USE NOTICE: This blog may contain copyrighted material. Such material is made available for educational purposes, to advance understanding of human rights, democracy, scientific, moral, ethical, and social justice issues, etc. This constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.

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40,000 demonstrate against Turkish government as economic crisis deepens

The Economy Sucks and or Collapse 2

The G-20 Washout By Mike Whitney

Dandelion Salad

By Mike Whitney
November 17, 2008 “Information Clearinghouse

As expected, the G-20 Economic Summit in Washington turned out to be a total bust. None of the problems which have pushed the global economy to the brink of disaster were resolved and none of the main players who gamed the system with their toxic securities were held accountable. Instead, the visiting dignitaries gorged themselves on stuffed quail and roast rack of lamb before settling on a toothless “Statement on Financial Markets” which accomplished absolutely nothing. The one noteworthy clause in the entire document is a two paragraph indictment of the United States as the perpetrator of the financial crisis. At least they got that right.

From the text:

“Root Causes of the Current Crisis: During a period of strong global growth, growing capital flows, and prolonged stability earlier this decade, market participants sought higher yields without an adequate appreciation of the risks and failed to exercise proper due diligence. At the same time, weak underwriting standards, unsound risk management practices, increasingly complex and opaque financial products, and consequent excessive leverage combined to create vulnerabilities in the system. Policy-makers, regulators and supervisors, in some advanced countries, did not adequately appreciate and address the risks building up in financial markets, keep pace with financial innovation, or take into account the systemic ramifications of domestic regulatory actions.

Major underlying factors to the current situation were, among others, inconsistent and insufficiently coordinated macroeconomic policies, inadequate structural reforms, which led to unsustainable global macroeconomic outcomes. These developments, together, contributed to excesses and ultimately resulted in severe market disruption.”

Bingo. The contagion started on Wall Street and that’s where the responsibility lies. It was the result of the Fed’s reckless low interest rates and lack of government oversight. This allowed market participants to create massive amounts of leverage via speculative bets on under-capitalized debt-instruments. The resulting collapse in value of all asset-classes across the spectrum has created a gigantic multi-trillion dollar capital hole in the global financial system which has precipitated violent swings in the stock markets, tightening credit, currency dislocations, soaring unemployment and deflation. Almost all of todays economic woes can be traced back to legislation that was promoted by key members of the Clinton and Bush administrations. (Many of who will now serve in the Obama White House) The G 20s statement puts the blame squarely where it belongs; on the Federal Reserve and Wall Street.

But this is old news. There’s no point in rehashing the past unless there’s a real interest in bringing the guilty parties to justice or unless the gathered leaders are serious about establishing the rules for a new economic regime. But they’re not, which is why the confab was just another political gab-fest devoid of any serious reforms.

It was interesting, though, to hear Bush, in a rare, unscripted moment, acknowledge that the extreme steps taken by the Fed and US Treasury–since Bear Stearns defaulted 17 months ago–were intended to avoid what he called “a depression greater than the Great Depression.” That’s quite an admission for Bush, as well as a vindication of the left-wing web sites which have been making the same prediction for more than 2 years. And although Bush rejected any personal responsibility for the policies which led to the crisis, it’s clear that he has some rudimentary grasp of its gravity. That’s a start. As he opined to the press, “This sucker could go down”.

Despite the outcry for meaningful reform, the summit only reinforces the status quo; the same old American-led financial system. In fact, there appears to be growing consensus that the IMF should spearhead the programs that provide liquidity to the developing countries that are getting pounded by the downturn. This is a major setback. It restores the IMF–which is the “iron fist” of the US Treasury– to its former glory so it can once again use its extortionist loans to thrust faltering nations into structural adjustment, privatization and slave wages. The meetings are breathing new life into the failed neoliberal policies that should be done away with once and for all.

The G 20 statement invokes the same “pro growth”, free market mumbo jumbo that permeates all far-right documents. Pro growth is code for low interest credit which allows market speculators to benefit from the steady flow of cheap capital while workers are stuck trying to make ends meet on stagnant wages and a falling dollar. It’s a way of making sure that the playing field is always tilted in favor of Wall Street. Pro growth does not mean strengthening productive activity or manufacturing goods that consumers want to buy. It means expanding credit through derivatives contracts and other leveraged investments to maximize profits on borrowed money. The long-term objective is to put the financial sector above the productive sectors of the real economy. It is a blueprint for maintaining dollar hegemony and Wall Street’s continued dominance over global finance.

The G 20 statement also rejects protectionism which defends the interests of labor and crucial national industries. Again, this just illustrates the blatant pro-Wall Street bias of the meetings where none of the leaders represented the interests of labor or unions. To hell with the working man.

The group called for more government stimulus to minimize the effects of the frozen credit markets, unemployment and deflation. They also demanded greater “transparency and accountability”, although it will probably amount to nothing. Wall Street is not about to give up the Golden Goose; its off balance sheets operations, its Level 3 “marked to fantasy” assets, its “dark pool” trading, and its opaque, convoluted accounting methods. These are the alchemists best friends which allow investment gurus with little talent and even less scruples to weave exotic debt-instruments into pure gold. Expect plenty of lip-service from Paulson and his brood about transparency, while revealing next to nothing about their shady activities.

Of course, there was the usual high-minded gibberish about “fostering innovation”, preserving market “dynamism” and striving for “poverty reduction”. Some of the leaders even called for the creation of “supervisory colleges” for bank regulators and limits on executive pay to “avoid excessive risk-taking.” (Oh, please) It’s a wonder that the developing nations, many of whom have been the victims of the IMF’s heavy-handed policies, would allow this type capitalist claptrap to be inserted into the final copy. It’s like something out of Milton Friedman’s memoirs. No one in the penthouse suites in downtown Manhattan will be taking a cut in pay anytime soon nor do they lose any sleep over “poverty reduction”. These guys are riverboat gamblers whose life-work is picking the pockets of unwitting investors.

What’s really needed instead of all this diversionary nonsense is strict compliance to a basic set of rules . The rules for financial institutions have been articulated by many market analysts including Karl Denninger (Market Ticker) in his “Genesis Plan”:

1– Force all off-balance sheet “assets” back onto the balance sheet, and force the valuation models and identification of individual assets out of Level 3 and into 10Qs and 10Ks. Enact this requirement beginning with the 3Q 2008 reporting period which begins next month. (ed.–All assets must be accounted for on the banks balance sheet)

2. Force all Over the Counter (OTC) derivatives onto a regulated exchange similar to that used by listed options in the equity markets. This permanently defuses the derivatives time bomb. Give market participants 90 days to get this done; any that are not listed in 90 days are declared void; let the participants sue each other if they can’t prove capital adequacy. (ed–This creates a public exchange so that regulators know whether derivatives contracts are sufficiently capitalized)

3. Force leverage by all institutions to no more than 12:1. The SEC intentionally dropped broker/dealer leverage limits in 2004; prior to that date 12:1 was the limit. Every firm that has failed had double or more the leverage of that former 12:1 limit. Enact this with a six month time limit and require 1/6th of the excess taken down monthly. (ed–The 5 largest investment banks claimed an aggregate asset-value of $4 trillion before Bear Stearns defaulted. Many, if not most, of those worthless assets are now on the Fed’s balance sheet underwritten by the US taxpayer. Too much leverage, simply means that the taxpayer pays the difference when the bank fails)

That’s the bulk of it right there. Follow the rules or go to jail. Period.

Of course, Glass Steagall will need to be reenacted–to separate commercial from investment banks–and the ratings agencies will have to be freed from any conflicts of interest. They cannot be paid by the same financial institutions that commission them to provide ratings; that’s a non-starter. The main thing is to restore confidence in the markets through transparency. Right now, the Obama camp is amassing the same collection of Wall Street sharpies who pushed to repeal Glass Steagall and allow derivatives to be traded off of a public exchange. They believe they can keep the same financial regime in place with just slight face-lift using Obama’s credibility to conceal their activities. That’s why it is critical for the nations with the largest capital reserves to establish an independent model for providing relief for developing countries that are hurting from the financial crisis. Otherwise, the IMF (US Treasury) will entangle them in their web of debt.

In his latest article “The Great Depression of the 21st Century: Collapse of the Real Economy” author and economist Michel Chossudovsky sheds some light on the agenda of the banking giants led by their standard-bearer at Treasury, Henry Paulson:

“Once they have consolidated their position in the banking industry, the financial giants including JP Morgan Chase, Bank of America, et al will use their windfall money gains and bailout money provided under TARP, to further extend their control over the real economy. The target of these acquisitions are the numerous highly productive industrial and services sector companies, which are on the verge of bankruptcy and/or whose stock values have collapsed. As a result of these developments, which are directly related to the financial meltdown, the entire ownership structure of real economy assets is in turmoil.

In a bitter twist, the new owners of industry are the institutional speculators and financial manipulators. They are becoming the new captains of industry, displacing not only the preexisting structures of ownership but also instating their cronies in the seats of corporate management”.

Chossudovsky sums it up perfectly. The financial crisis is being used by Wall Street big-wigs to restructure the economy and create a permanent class of working poor.

The world doesn’t need a new Breton Woods or a new world order; it needs a competing vision of global finance. One that will put an end to dollar tyranny, superpower politics and “beggar thy neighbor” economic policies. A system that strengthens national sovereignty, cooperation, and international law. That’s what the G 20 should have been talking about, instead of wasting their time trying to prop up a system that’s rotten to the core.

FAIR USE NOTICE: This blog may contain copyrighted material. Such material is made available for educational purposes, to advance understanding of human rights, democracy, scientific, moral, ethical, and social justice issues, etc. This constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. If you wish to use copyrighted material from this site for purposes of your own that go beyond ‘fair use’, you must obtain permission from the copyright owner.

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Naomi Klein on the Bailout Profiteers and the Multi-Trillion-Dollar Crime Scene

G20 summit ‘punts’ till April

The G20 Won’t Change This Financial Crime Scene by Richard C. Cook

The Great Depression of the 21st Century: Collapse of the Real Economy

The Economy Sucks and or Collapse

The G20 Won’t Change This Financial Crime Scene by Richard C. Cook

by Richard C. Cook
featured writer
Dandelion Salad
richardccook.com
November 16, 2008

Remarks by Richard C. Cook
George Mason University, Fairfax, Virginia
November 15, 2008

The G20 is meeting today in Washington, D.C., to discuss the world financial crisis, its causes, and what can be done about it. But this won’t help the people of the U.S. who have been victimized by their own financial system.

The stated objectives are to find ways to stabilize and reduce speculation in the financial markets and make financial transactions more transparent, more efficient, and more international in scope. But this is also a revolt by the nations of the world against over-reliance on the U.S. dollar as the world’s reserve currency. What we are likely to see over time is a multi-currency regime that includes the Euro and one or more Asian currencies as well.

But the conference will not address the real causes of why the world is heading into a global recession or why the U.S. economy in particular is in such dire straits. Nor will the meeting lresult in redress of the staggering level of bankers’ criminality abetted by the U.S. government in the creation of the financial bubbles whose collapse is underway.

The real problem is that the world is locked into a debt-based financial system run by the world’s banks, where the only way currency can be entered into circulation is through lending. It’s been massive amounts of completely irresponsible lending which have leveraged the bubbles against much smaller amounts of tangible value.

The GDP of the entire world is $55 trillion. This is dwarfed by speculative lending in the derivatives markets of ten times that amount–$525-$550 trillion. No nation has clean hands in this travesty. The governments of the world and the central banks have allowed it to come into being.

Within the U.S., reliance on money-creation through bank lending has been the problem since the creation of the Federal Reserve System in 1913. At that point the U.S. monetary system was privatized. The case has been the same with all the other nations which have private banking systems that control their central banks. The granddaddy is the Bank of England which dates from 1694.

The creation of the Federal Reserve System marked the start of a century of world war. This is hardly a coincidence. Indeed, the central banking system encourages wars and lives off them, because it is war and the threat of war that is most profitable to a system where the more money governments borrow the more profits the banks make.

Continue reading

The Great Depression of the 21st Century: Collapse of the Real Economy

Dandelion Salad

by Michel Chossudovsky
Global Research, November 15, 2008

The financial crisis is deepening, with the risk of seriously disrupting the system of international payments.

This crisis is far more serious than the Great Depression. All major sectors of the global economy are affected. Recent reports suggest that the system of Letters of Credit as well as international shipping, which constitute the lifeline of the international trading system, are potentially in jeopardy.

The proposed bank “bailout” under the so-called Troubled Asset Relief Program (TARP) is not a “solution” to the crisis but the “cause” of further collapse.

The “bailout” contributes to a further process of destabilization of the financial architecture. It transfers large amounts of public money, at taxpayers expense,  into the hands of private financiers. It leads to a spiraling public debt and an unprecedented centralization of banking power. Moreover, the bailout money is used by the financial giants to secure corporate acquisitions both in the financial sector and the real economy.

In turn, this unprecedented concentration of financial power spearheads entire sectors of industry and the services economy into bankruptcy, leading to the layoff of tens of thousands of workers.

The upper spheres of Wall Street overshadow the real economy. The accumulation of large amounts of money wealth by a handful of Wall Street conglomerates and their associated hedge funds is reinvested in the acquisition of real assets.

Paper wealth is transformed into the ownership and control of real productive assets, including industry, services, natural resources, infrastructure, etc.

Collapse of Consumer Demand

The real economy is in crisis. The resulting increase in unemployment is conducive to a dramatic decline in consumer spending which in turn backlashes on the levels of production of goods and services.

Exacerbated by neoliberal macro-economic policy, this downward spiral is cumulative, ultimately leading to an oversupply of commodities.

Business enterprises cannot sell their products, because workers have been laid off. Consumers, namely working people, have been deprived of the purchasing power required to fuel economic growth. With their meager earnings, they cannot afford to acquire the goods produced.

Overproduction Triggers a String of Bankruptcies

Inventories of unsold goods pile up. Eventually, production collapses; the supply of commodities declines through the closing down of production facilities, including manufacturing assembly plants.

In the process of plant closure, more workers become unemployed. Thousands of bankrupt firms are driven off the economic landscape, leading to a slump in production.

Mass poverty and a Worldwide decline in living standards is the result of low wages and mass unemployment. It is the outcome of a preexisting global cheap labor economy, largely characterized by low wage assembly plants in Third World countries.

The current crisis extends the geographic contours of the cheap labor economy, leading to the impoverishment of large sectors of the population in the so-called developed countries (including the  middle classes).

In the US, Canada and Western Europe, the entire industrial sector is potentially in jeopardy.

We are dealing with a long-term process of economic and financial restructuring. In its earlier phase, starting in the 1980s during the Reagan Thatcher era, local and regional level enterprises, family farms and small businesses were displaced and destroyed. In turn, the merger and acquisition boom of the 1990s led to the concurrent consolidation of large corporate entities both in the real economy as well as in banking and financial services.

In recent developments, however, the concentration of bank power has been at the expense of big business.

What is distinct in this particular phase of the crisis, is the ability of the financial giants not only to create havoc in the production of goods and services, but also to undermine and destroy large corporate entities of the real economy.

Bankruptcies are occurring in all major sectors of activity: Manufacturing, telecoms, consumer retail outlets, shopping malls, airlines, hotels and tourism, not to mention real estate and the construction industry, victims of the subprime mortgage meltdown.

General Motors has confirmed that “it could run out of cash within a few months, which could prompt one of the biggest bankruptcy filings in U.S. history”. (USNews.com, November 11, 2008))  In turn this would backlash on a string of related industries. Estimates of job losses in the US auto industry range from 30,000 to as much as 100,000.(Ibid).

[graph]

In the US, consumer retail companies are in difficulty: the share prices of JC Penney and Nordstrom department store chains have collapsed. Circuit City Stores Inc. filed for Chapter 11 protection. The shares of Best Buy, the electronics retail chain, have plunged.

The Vodafone Group PLC, the world’s biggest mobile phone company not to mention InterContinental Hotels PLC are in difficulty, following the collapse of stock values. (AP, Nov 12, 2008). Worldwide, over two dozen airlines have gone under in 2008, adding to a string of airline bankruptcies in the course of the last five years. (Aviation and Aerospace News, 30 October 2008). Denmark’s Second commercial airline Stirling has declared bankruptcy. In the US, a growing list of real estate companies have already filed for bankruptcy protection.

[graphs]

In the last two months, there have been numerous plant closures across America leading to the permanent layoff of tens of thousands of workers. These closures have affected several key areas of economic activity including the pharmaceutical and chemical industries, the automobile industry and related sectors, the services economy, etc.

US factory orders have declined dramatically. Research firm Autodata reported in October that “sales of cars and light trucks in September had declined 27 percent compared with a year earlier.”(Washington Post, October 3, 2008)

Unemployment

According to the US Bureau of Labor Statistics, an additional 240,000 jobs were lost during the month of October alone:

“Nonfarm payroll employment fell by 240,000 in October, and the unemployment rate rose from 6.1 to 6.5 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. October’s drop in payroll employment followed declines of 127,000 in August and 284,000 in September, as revised. Employment has fallen by 1.2 million in the first 10 months of 2008; over half of the decrease has occurred in the past 3 months. In October, job losses continued in manufacturing, construction, and several service-providing industries…

Among the unemployed, the number of persons who lost their job and did not expect to be recalled to work rose by 615,000 to 4.4 million in October. Over the past 12 months, the size of this group has increased by 1.7 million.” (Bureau of Labor Statistics, November, 2008)

The official figures do not describe the seriousness of the crisis and its devastating impact on the labor market, since many of the job losses are not reported.

The situation in the European Union is equally disturbing. A recent British report points to the potential plight of mass unemployment in North Eastern England. In Germany, a report published in October, suggests that 10-15% of all automotive jobs in Germany could be lost.

Job cuts have also been announced at General motors and Nissan-Renault plants in Spain. Sales of new cars in Spain plummeted by 40 percent in October in relation to sales a the same month last year.

pic

Workers of Nissan automaker protest in front of the Japanese company’s building in Barcelona (AFP)

Bankruptcies and Foreclosures: A Money-spinning Operation for the Financial Giants

Among the companies on the verge of bankruptcy are some highly lucrative and profitable operations. The important question: who takes over the ownership of bankrupt giant industrial corporations?

Bankruptcies and foreclosures are a money-spinning operation. With the collapse in stock market values, listed companies experience a major collapse of the price of their stock, which immediately affects their creditworthiness and their ability to borrow and/ or to renegotiate debts ( which are based on the quoted value of their assets).

The institutional speculators, the hedge funds, et al have cashed in on their windfall loot.

They trigger the collapse of listed companies through short selling and other speculative operations. They then cash in on their large scale speculative gains.

According to a report in the Financial Times, there is evidence that the plunge of the US automobile industry was in part manipulated:  “General Motors and Ford lost 31 per cent to $3.01 and 10.9 per cent to $1.80 despite hopes that Washington may save the industry from the brink of collapse. The fall came after Deutsche Bank set a price target of zero on GM.” (FT, November 14, 2008)

The financiers are on a shopping-spree. America’s Forbes 400 billionaires are waiting in limbo.

Once they have consolidated their position in the banking industry, the financial giants including JP Morgan Chase, Bank of America, et al  will use their windfall money gains to further extend their control over the real economy.

The next step consists in transforming liquid assets,  namely money paper wealth, into the acquisition of real economy assets.

In this regard, Warren Buffett’s Berkshire Hathaway Inc. is a major shareholder of General Motors. More recently, following the collapse in stock values in October and November, Buffett boosted his stake in oil producer ConocoPhillips, not to mention Eaton Corp, whose price on the NYSE tumbled by 62% in relation to its December 2007 high (Bloomberg).

The target of these acquisitions are the numerous highly productive industrial and services sector companies, which are on the verge of bankruptcy and/or whose stock values have collapsed.

The money managers are picking up the pieces.

Ownership of the Real Economy

As a result of these developments, which are directly related to the financial meltdown, the entire ownership structure of real economy assets is in turmoil.

Paper wealth accumulated through insider trading and  stock market manipulation is used to acquire control over real economic assets, displacing the preexisting ownership structures.

What we are dealing with is an unsavory relationship between the real economy and the financial sector. The financial conglomerates do not produce commodities. They essentially make money through the conduct of financial transactions. They use the proceeds of these transactions to take over bona fide real economy corporations which produce goods and services for household consumption.

In a bitter twist, the new owners of industry are the institutional speculators and financial manipulators. They are becoming the new captains of industry, displacing not only the preexisting structures of ownership but also instating their cronies in the seats of corporate management.

No Reform Possible under the Washington-Wall Street Consensus

The November 15 G-20 Financial Summit in Washington upholds the Washington-Wall Street consensus.

While formally presenting a project to restore financial stability, in practice, the hegemony of Wall Street remains unscathed. The tendency is towards a unipolar monetary system dominated by the United States and upheld by US military superiority.

The architects of financial disaster under the 1999 Gramm-Leach-Bliley Financial Services Modernization Act (FSMA) have been entrusted with the task of mitigating the crisis, which they themselves created. They are the cause of financial collapse.

The G20 Financial Summit doesn’t question the legitimacy of the hedge funds and the various instruments of derivative trade. The final communiqué includes an imprecise and blurred commitment “to better regulate hedge funds and create more transparency in mortgage-related securities in a bid to halt a global economic slide.”

A solution to this crisis can only be brought about through a process of  “financial disarmament” as initially formulated by John Maynard Keynes, which forcefully challenges the hegemony of the Wall Street financial institutions including their control over the monetary policy.

Obama Endorses Financial Deregulation

Barack Obama has embraced the Washington-Wall Street consensus. In a bitter twist, former Congressman Jim Leach, a Republican who sponsored the 1999 FSMA in the House of Representatives is now advising Obama on formulating a timely solution to the crisis.

Jim Leach, Madeleine Albright and former Treasury Secretary Larry Summers, who also played a key role in pushing through the FSMA legislation, were in attendance at the November 15 G-20 Financial Summit, as part of President-elect Barack Obama’s advisory team:

“President-elect Barack Obama and Vice President-elect Joe Biden announced that former Secretary of State Madeleine Albright and former Republican Congressman Jim Leach would be available to meet with delegations at the G-20 summit on their behalf. Leach and Albright are holding these unofficial meetings to seek input from visiting delegations on behalf of the president-elect and vice president-elect. (mlive.com, November 15, 2008)

© Copyright Michel Chossudovsky, Global Research, 2008

The url address of this article is: www.globalresearch.ca/index.php?context=va&aid=10977

see

The Worst Is Not Behind Us By Nouriel Roubini

Sec Henry Paulson interview

Elijah Cummings Is No Chump! Kucinich: Who are you working for?

Wall Street’s Bailout is a Trillion-Dollar Crime Scene — Why Aren’t the Dems Doing Something About It? By Naomi Klein

Illegal tax scheme gives $140 billion to biggest US banks

The Economy Sucks and or Collapse

Global Pulse: G20: A New World Order

Dandelion Salad

linktv

(November 13, 2008) With the financial crisis in full swing, the leading economic countries, the G7, are now turning to developing nations for support and guidance. President Bush is hosting the first in a series of meetings called the G20 that will include economic powerhouses like China, Russia and Brazil. But, these countries want more say in future economic decisions. With their huge reserves of foreign currency and fairly stable economies, a new world order could be on the horizon.

SOURCES: KBS News, South Korea; Al Jazeera English, Qatar; CCTV, China; TVE, Spain; BBC World, U.K.; CNN, U.S.


Global Pulse is a fast-moving and informative television and web series that helps you navigate the news of the world by comparing and contrasting TV news reports. See all the episodes of Global Pulse at http://linktv.org/globalpulse

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Bailouts for banks: Layoffs for workers

A Credit Crisis or a Collapsing Ponzi Scheme?

Paulson the Bungler By Mike Whitney

Crisis Is Beyond The Reach of Traditional Solutions By Paul Craig Roberts

Towards a Common Standard Benchmark for evaluating all Monetary Reform Proposals

Why The Bailout Isn’t Working by Josh Sidman

The New World Order Monetary System

Sign Petition for a Monetary System That Puts People First – Open Letter to G-20

The Economy Sucks and or Collapse