The Chicago-based Crown Family might be known for their philanthropic efforts around the country, donating millions of dollars to universities, art institutions and a variety of other causes. Where did all that wealth come from? James Crown is the current director of General Dynamics (GD), the 5th largest weapons producer in the country and has their hands dirty in the Saudi-led war in Yemen, in Palestine and even at the Mexico border. His father, Lester Crown, was a previous president and chair of GD. His grandfather, Henry Crown, created the Material Service Corporation which eventually merged with GD, and gained controlling interest in GD in 1959, also becoming its director and chair.
The gap between what needs to be done to save the Earth from the environmental disaster of unchecked global warming and what is actually being done continues to widen. Yet another exemplar of this gap is the funding practices of the world’s biggest banks.
Although the repo market is little known to most people, it is a $1-trillion-a-day credit machine, in which not just banks but hedge funds and other “shadow banks” borrow to finance their trades. Under the Federal Reserve Act, the central bank’s lending window is open only to licensed depository banks; but the Fed is now pouring billions of dollars into the repo (repurchase agreements) market, in effect making risk-free loans to speculators at less than 2%.
What’s going on in the repo market? Rates on repurchase agreements (“repo”) should be around 2%, in line with the fed funds rate. But they shot up to over 5% on September 16 and got as high as 10% on September 17. Yet banks were refusing to lend to each other, evidently passing up big profits to hold onto their cash – just as they did in the housing market crash and Great Recession of 2008-09.
On December 11, 2014, the US House passed a bill repealing the Dodd-Frank requirement that risky derivatives be pushed into big-bank subsidiaries, leaving our deposits and pensions exposed to massive derivatives losses. The bill was vigorously challenged by Senator Elizabeth Warren; but the tide turned when Jamie Dimon, CEO of JPMorganChase, stepped into the ring. Perhaps what prompted his intervention was the unanticipated $40 drop in the price of oil. As financial blogger Michael Snyder points out, that drop could trigger a derivatives payout that could bankrupt the biggest banks. And if the G20’s new “bail-in” rules are formalized, depositors and pensioners could be on the hook. Continue reading
Sixteen of the world’s largest banks have been caught colluding to rig global interest rates. Why are we doing business with a corrupt global banking cartel?
United States Attorney General Eric Holder has declared that the too-big-to-fail Wall Street banks are too big to prosecute. But an outraged California jury might have different ideas. As noted in the California legal newspaper The Daily Journal: Continue reading
Taxpayers are paying billions of dollars for a swindle pulled off by the world’s biggest banks, using a form of derivative called interest-rate swaps; and the Federal Deposit Insurance Corporation has now joined a chorus of litigants suing over it. According to an SEIU report:
Derivatives… have turned into a windfall for banks and a nightmare for taxpayers…. While banks are still collecting fixed rates of 3 to 6 percent, they are now regularly paying public entities as little as a tenth of one percent on the outstanding bonds, with rates expected to remain low in the future. Over the life of the deals, banks are now projected to collect billions more than they pay state and local governments – an outcome which amounts to a second bailout for banks, this one paid directly out of state and local budgets.
The following was originally posted at Occupy.com.
In May, JPMorgan Chase was listed as the largest bank in the world with assets at roughly $4 trillion — some $1.53 trillion of it in derivatives. This was reported a month after the announcement that the bank had posted a record first-quarter profit of $6.5 billion.
Jamie Dimon, the bank’s CEO and Chairman, has faced a host of scandals in relation to his management of the megabank, including the loss of roughly $6 billion through the London branch of the bank — losses that Dimon was accused of hiding. Continue reading
On Christmas Eve, when most were at home with family and friends or out-of-town, a summons was served at the Sebastopol City Hall. The giant CVS Pharmacy sued the City and its elected officials.
Sebastopol’s recently elected City Council voted unanimously, 5-0, on Dec. 18 to enact a temporary, 45-day moratorium against drive-through operations. CVS seeks to nullify that moratorium and proceed with plans that it has been working on since 2009, but which have not been fully approved and permitted, to build two stores with drive-throughs.
Small town Sebastopol residents in Northern California have been waging a fierce David vs. Goliath struggle against the powerful Chase Bank, CVS Pharmacy, and Armstrong Development for over two years. The implications of this struggle extend beyond this one town, as big business continues to seek to expand its wealth.
I’ve operated the small, artisan Kokopelli Farm, which grows mainly berries, for the last 20 years. It is located a couple of miles from small town Sebastopol’s downtown commons in Northern California. Our town has less than 8000 people and is the economic center of what is called the West County of the coastal Sonoma County. We historically have had a vibrant local economy, which is now being threatened by the desires of big businesses to further concentrate their enormous power and drain the agrarian wealth out of the land and people.
What would happen if we asked the executives of the giant U.S. corporations, whose products constantly surround us, to show some corporate patriotism?
After all, General Electric, DuPont, Citigroup, Pfizer and others demand that they be treated as “persons” under our Constitution and our laws. And, they expect unfiltered loyalty from American workers even to the point of blocking the organization of unions so workers can band together for collective bargaining.
When Jamie Dimon, CEO of JPMorgan Chase Bank, appeared before the Senate Banking Committee on June 13, he was wearing cufflinks bearing the presidential seal. “Was Dimon trying to send any particular message by wearing the presidential cufflinks?” asked CNBC editor John Carney. “Was he . . . subtly hinting that he’s really the guy in charge?”
A friend who works in Congress and actually reads the Congressional Record suggested that a collection of excerpted falsehoods by Republicans on the floor of the House of Representatives and Senate would make compelling evidence for the truth of economist Albert Hirschman’s book, The Rhetoric of Reaction(1991).
Professor Hirschman, a very original political economist, found throughout American history the following three propositions were commonly used to counter social justice efforts: