lunedì 11 gennaio 2010
Facoltà di Economia
Corso di laurea in Economia dell’Azienda Moderna
Curriculum in Banche, Mercati e Finanza Immobiliare
LE BANCHE CENTRALI E IL SIGNORAGGIO
RELATORE: Chiar.mo Prof.re : CLAUDIO GIANNOTTI
TESI DI LAUREA DI: MARUSKA DISTEFANO
ANNO ACCADEMICO 2008 / 2009
1.1 La nascita del signoraggio
1.2 Il signoraggio oggi
1.3 Esempio in “ soldoni “ del signoraggio
1.4 La sovranità monetaria
1.5 Il valore indotto della moneta
1.6 Autorevoli rilevazioni
LE BANCHE CENTRALI E I GOVERNI
2.1 Le Banche Centrali occidentali
2.1.1 La Federal Reserve
2.1.2 Bce e trattato di Maastricht
2.1.3 La Banca d’ Italia e il Decreto 561
2.2 Caso giudiziario emblematico
2.3 I bilanci
2.4 Stati sovrani debitori in aeternum?
2.5 Il Fondo Monetario Intenazionale
2.5.1 La critica al Fondo Monetario Internazionale
2.6 Due proposte USA : il liberty dollar e la moneta di Stato
2.7 Valuta regionale complementare all’euro
IL SIGNORAGGIO NEL SISTEMA BANCARIO ISRAELIANO
3.1 Il sistema bancario israeliano
3.1.2 Moneta e mercato valutario.
3.2 Le privatizzazioni e il signoraggio
3.3 Il kibbutz Samar
Newsletter No. 28 - January 2010
Links to previous Newsletters can be found here.
To be notified of new Newsletters, click here.
1. Editorial: The Transition To A New Decade
2. Money System Reform
2.1. The Purpose of the Money System
2.2. Various Aspects of the Money System
2.3. Monetary Reform: Creating the Public Money Supply
(1) A Call for Volunteers
(2) The Coming General Election
(3) New Economics Foundation
3. Lessons From Copenhagen
3.1. "Developed" and "Developing" Nations
3.2. Seeing The Problem Whole
3.3. What Can Citizens Do?
4. Book Reviews
(1) Common Wealth: For A Free, Equal, Mutual And Sustainable Society by Martin Large
(2) Critical Social Theory And The End Of Work by Edward Granter
(3) A Renewable World: Energy, Ecology, Equality by Herbert Girardet and Miguel Mendonça
(4) The Case For Pluralism fromDag Hammarskjold Foundation
5. Next Newsletter
1. EDITORIAL: THE TRANSITION TO A NEW DECADE
The 'Noughties' have shown that we in the "democratic West", led by a global super-power in the USA, can no longer claim a specially democratic and influential position in world affairs.
The claim to be democratic has been disastrously damaged by our self-imposed dependence on profit-making commercial banks to provide our public money supply, by our elected representatives' money-grubbing, and by the way the US and Britain invaded Iraq and destabilised the Middle East.
The claim to be influential has been shown up at the recent Copenhagen conference on climate change, when the newly powerful nations, led by China and supported by many "less developed" peoples, insisted that their future development prospects should not suffer from the need to repair the global ecological damage caused by Western development over the past 200 years, and that we should bear the main cost of repairing it.
In Britain we face a general election within the next six months. There is a widespread sense that none of our mainstream political parties is capable of responding effectively to the range of national and international challenges we now face. If their election campaigns confirm this, the result could be a temporary "hung Parliament".
We electors and our politicians might then recognise the need for deeper-seated changes than mainstream agendas now offer. A two-year transition to the 'Teenies' decade could then see the start of a deliberate shift to a new worldwide path of co-operative development and democratic participation. It would give us a much better chance of securing the future of our and other endangered species, than trying to restore competitive Business-As-Usual.
2. MONEY SYSTEM REFORM
A major aspect of that new path of development has to be a money system fit for its purpose.
2.1. The Purpose of the Money System
The money system's purpose must change from what it has been since its origins in the distant past. It must no longer be designed to provide a stealthy way to transfer wealth from weaker and poorer people to richer and more powerful ones. (If you don't believe that this is a fair description, take a look at my short History Of Money - www.jamesrobertson.com/books.htm#history).
Its new public purpose now must be to enable everyone to benefit from fair and efficient exchanges of goods and services, reflecting what we each contribute to and take from the common wealth. It is a purpose for which governmental agencies at local, national and international level must become directly responsible.
To get the money system reconstructed for this new purpose, we have to understand it as a system of interacting money subsystems which influences our behaviour at every level - personal, household, local, national, and global. We have to understand how it generates a calculus of values, and how that operates as a scoring system motivating us by rewarding some things and penalising others. And we have to understand how its present modes of operation motivate us to behave in ways that hasten our species' suicide.
The following four governmental decisions primarily determine how the money system works - in other words, what values it generates in terms of the prices and costs of everything compared with everything else, and so how it motivates us to behave:
how the public money supply is created, by whom and in what form (as debt or debt-free);
how governments collect public revenue (for example, what they tax and what they don't tax);
what public spending is spent on and what it isn't spent on; and
how governments regulate the financial dealings of individual people and other organisations.
Today, all of those urgently need systemic understanding and reform.
2.2. Various Aspects of the Money System
I warmly recommend the December 2009/ January 2010 items in Charles Bazlinton's Blog The Free Lunch.
They deal with many of the reforms needed in various aspects of the money system, including changing the way money is created, the need for land value taxation and a Citizen's Income, and how to get rid of the continually growing maze of regulations intended as substitutes for those necessary basic reforms.
I suggest you start with the "hilarious fun and nonsense" lessons of Wallace and Gromit in the 6 January item on the 2010 UK general election, and work backwards through the 16 December free lunch for thousands of people in Trafalgar Square, and end with the 28 November item on Professor Richard Werner's latest interview on monetary matters.
2.3. Monetary Reform: Creating the Public Money Supply
In Britain over the past few months public anger has continued to rise against the bankers who landed us in the present mess. It is also widely perceived that, in the leading political parties, virtually nobody knows how to prevent the same thing happening again.
That includes the Lib Dems, although Vince Cable is judged to talk most common sense about the issues as they continue to arise. It also includes Labour, since Gordon Brown as Chancellor was most clearly responsible for encouraging the boom and bust debacle. And it obviously includes the Conservatives - not mainly because they didn't noticeably try to stop the boom and bust, but because they are still known to represent the interests of people, including themselves, who benefit most from continuing high bank profits.
Moreover, the public servants responsible for advising the present government, "such as Lord Myners, Lady Vadera, Lord Turner and John Kingman, were all past or present bankers, or friends of bankers. When they leave public life they are likely to work for a bank" - click here. So what is to be done? Here are some suggestions.
(1) A Call for Volunteers from Ben Dyson - http://www.call4reform.org/
"Join the Campaign for Monetary Reform, and Help to Change the World
Our self-imposed dependence on commercial banks to create our public money supply has a disastrously destructive impact on the economy and society in every country in the world. We need your help to change it.Ten years ago Joseph Huber and James Robertson published a clear and effective proposal for monetary reform, to transfer to a public agency the function of creating the public money supply to serve the public interest.
Implementing this reform could prevent future financial crises as well as allowing us to escape from the debt trap that we are currently in. However, one of the biggest problems is that very few people know anything about this issue. The press and politicians either do not understand the problem, or prefer to ignore it. It's Time To Change ThatIn early 2010, we’ll be launching the most focused campaign for monetary reform that has been seen to date. Similar campaigns are needed in other countries. But this one will concentrate on the UK. We will aim for 1 million people from the UK to call for reform of the monetary system over the next year. This will show MPs and the government that they can no longer ignore the issue that is at the root of the majority of social problems, and which caused the worst crisis in the financial sector in 70 years. We have already had meetings with some of the most senior politicians in the UK, but they need to know that the public will support them in reforming the system. This is why we need 1 million people to call for reform.We Need The Help of Talented PeopleEducating 1 million people requires talented people with a wide range of skills. We need people like you to join the campaign team. You will be able to work from home or elsewhere in your own time but you will be collaborating with a network of people all over the UK. In addition, there will be full-time, paid opportunities arising in the next 12 months. Contact MeIf you want to make a major impact on the world and economy, and can offer your skills and talent to make monetary reform a reality, contact me now by sending an e-mail to 'ben at bendyson dot com'. PS. Other major social issues are all important, but the monetary system is at the root of most of them. By attacking the root of the problem, we can solve social and economic problems that have been unsolvable for decades.
(2) The coming general election also provides an opportunity to support independents who campaign for monetary reform. They include:
Anne Belsey - http://www.moneyreformparty.org.uk/
Dick Rodgers - http://www.thecommongood.info/
For Independent candidates in general, Terry Waites' New Year message to Independent parliamentary candidates has suggested to me that we should persuade as many of them as possible to understand the need for monetary reform and to include it in their manifestos.
(3) New Economics Foundation
Please take a look at the new page on Monetary Reform on nef's website - www.neweconomics.org/projects/monetary-reform. It will be interesting to see how it goes.
Likewise how nef develops specific practical proposals from the findings in its recent report "A Bit Rich" - www.neweconomics.org/publications/bit-rich - and its aspirations in "The Great Transition" - www.neweconomics.org/publications/the-great-transition.
3. LESSONS FROM COPENHAGEN
Was the Copenhagen conference on climate change last month a sheer waste of carbon and other greenhouse gases, not to mention money and valuable time? Does the coldest weather ever experienced by many people in many parts of the world now cast doubt on global warming anyway? To both questions the answer must be "No, not really, but ...".
The world community must learn from Copenhagen the need to reconsider both the substance of the key development challenges facing the world in the 21st-century, and the process of deciding how to tackle them.
3.1. "Developed" and "Developing" Nations
At Copenhagen, the formerly dominant "developed" nations were woefully unprepared for the rest of the world's insistence that its development prospects should not be damaged by the payback costs of the ecological damage caused by Western development over the past 200 years. We need to understand that as reasonable.
One of the many people who expressed that view was Sudanese-born entrepreneur Mo Ibrahim in "Africa must exploit all energy sources" (Financial Times, 18 December 2009).
He said, among other things:
"Carbon trading has been touted by many as an important tool for cutting emissions. It may be part of the solution. But we must admit an important premise: Africans account for 13 per cent of the world’s population and are responsible for less than 4 per cent of carbon emissions. That is our carbon credit. It is the only basis for any carbon trading that makes sense."
Another was Thompson Ayodele, director of the Initiative for Public Policy Analysis, Lagos, Nigeria in "North hides nefarious aims under green cloak" (Business Day, South Africa, 17 December 2009).
More recently, on 5 January the President of Bolivia, Evo Morales issued an invitation to a new international conference on climate change:
"Making clear that those most affected by climate change will be the poorest in the world who will see their homes and their sources of survival destroyed, and who will be forced to migrate and seek refuge;
- Confirming that 75% of historical emissions of greenhouse gases originated in the countries of the North that followed a path of irrational industrialization;
- Regretting the failure of the Copenhagen Conference caused by countries called “developed”, that fail to recognize the climate debt they have with developing countries, future generations and Mother Earth."
It will be held from 20th to 22nd April 2010 in Cochabamba, Bolivia. For the full text of the invitation, go to http://cmpcc.org/2010/01/05/call/. (Thanks to Roy Madron for this.)
3.2. Seeing The Problem Whole
In future it will surely make sense for world development conferences to deal with other global problems as well as energy, which are inextricably linked with climate change. They include:
food production and distribution,
availability of land and water,
reforms of existing international (and national) systems of government, politics and the law*, and
reforms of existing international (and national) money systems.
* Fascinating background to one aspect is in Jonathon Porritt's November 2009 report on "The Standing of Sustainable Development in Government", reflecting his nine years' experience as the first head of the UK Government's Sustainable Development Commission.
For a summary of the present challenges of world development by Lester Brown, click here.
3.3. What Can Citizens Do?
In addition to all the "lifestyle" actions we can take as individuals and households and local communities, we can pressurise our governments to bring in policies to change the present direction of our societies' development - for example by persuading parliamentary candidates to support them - see 2.3(2) above.
In his thoughtful and interesting messages of 5 January and 6 January, John Bunzl draws the lesson from Copenhagen that we should adopt an international "Simultaneous Policy" approach to pressurising our governments in that way.
Asking them to adopt the necessary policy changes simultaneously would remove the excuse they now constantly make under pressure from their businesses and industries, that by adopting these policies before other countries do, they will damage their economic competitiveness.
There is more about Simpol at http://www.simpol.org/.
4. BOOK REVIEWS
(1) Martin Large, COMMON WEALTH: For a free, equal, mutual and sustainable society, Hawthorn Press, 2010, hardback, 285pp, £15.00.
The book is being launched in London at the Society Guardian Future of Housing Summit in London on 25 January.
I was very glad to endorse this book as follows.
"Only by sharing the value of our common resources more fairly, is humanity likely to be able to avoid the worldwide self-destruction towards which our present path of development is leading us.
In his masterly new book Martin Large explores the changes this implies for the structures of business, government and civil society and the relationships between them. He identifies land value taxation and a citizen's income as among the measures that will help to bring the changes about.
Please read it if you care about the future of our species."
The book's special importance is that, while it concentrates on helping people who "want to get on with building the social future where they are, whether this means developing more sustainable businesses, caring for the environment, renewing democracy or community development", it also recognises that, to facilitate that, "the current captive corporate state can be replaced by a government that works for the common good; the economy can be freed from neo-liberal capitalism by developing an associative, fair trade economy; and public services such as education and health can be liberated from both state dominance and from commercialisation".
It brings together practical grass-roots guidance with wider understanding of the need for national and global change.
(2) Edward Granter, CRITICAL SOCIAL THEORY and the END of WORK, Ashgate, 2009, hardback, 202pp, £55.00.
I have enjoyed this account of the development of ideas about work and its future in the industrial age. Having myself been one of the British authors on this subject in the 1970s and 1980s - www.jamesrobertson.com/books.htm#futurework - I was glad to be reminded of the work of others like Krishan Kumar, Charles Handy, Clive Jenkins and Barry Sherman. I even felt rather chuffed at finding my name in the same company as academic post-Marxist luminaries like Herbert Marcuse and André Gorz.
However, I am still as convinced as I was then that "the end of work" misses the point. We should be discussing the liberation of work.
It is a basic error to assume, as most people seem to do today, that working for an employer is the only way to work, and that that is actually the meaning of "work". In fact, it is often much better to work, if you can, for yourself and your family and your community, doing things and providing goods and services which you yourself value as worth providing.
I am sure that extending the freedom and ability of people to practise that kind of "ownwork" will now gather more support than it has done in the past thirty or forty years. In the age of "sustainable development" it must become clear that to stifle that freedom, by persuading or compelling as many people as possible to increase the job statistics, is unacceptably wasteful.
That is most clearly due to the mass duplication of infrastructure and services between home and workspace, and the mass daily commute between them and back again, which that policy requires. But it inevitably also limits many people's sense of ethical commitment to good work.
Granter's conclusion is that "by pointing to the radical possibilities for transforming work, end of work theories highlight the possibilities for radical transformation of society as a whole". I am sure his work will interest scholars of sociology, history of ideas, and social and cultural theory. I am not so sure how much it will help or inspire people who are actively trying to bring the transformation about.
(3) Herbert Girardet and Miguel Mendonça, A RENEWABLE WORLD: Energy, Ecology, Equality, Green Books, 2009, 256pp, £14.95/$27.95.
For a description of its contents please click on the title (above) of this important Report for the World Future Council. Its last chapter is on "Going Deeper, Looking Further". It recognises that, although the book has placed a strong emphasis on climate change, "even if climate change were not happening, we would still need to change our energy systems, restore the health of ecosystems, create more livable cities, vibrant communities and resilient localities, use less resources, spread wealth, increase international peace and leave behind a world fit for our children and grandchildren. So climate change could be seen as the final wakeup call to create an ethical, sustainable world...."
Although the Report recognises the need for various separate changes involving money and finance, it doesn't suggest a comprehensive and systematic reconstruction of the money system that influences how almost everyone in the world now behaves - personally, locally, nationally and internationally.
So it's good to know that the World Future Council recognises the need for a new financial system at the core of the new economy that humanity now needs, and that a coalition of social banks has provided core funding for the Council's policy work on it over the next three years - www.worldfuturecouncil.org/future_finance.html.
(4) Dag Hammarskjold Foundation, THE CASE FOR PLURALISM; "What Next" Vol. II; Development Dialogue No 52, August 2009, 199pp.
As a participant with the International Foundation for Development Alternatives (IFDA) in the 1970s and subsequently with the Dag Hammarskjöld Foundation on "Another Development, What Now", I was sad to learn of the impending end of the 'What Next' project.
So it was a relief to know that a new "What Next Initiative" - http://www.whatnext.org/ - will carry forward the exploration of "alternative paths that can take us to a decent and sustainable future. That requires unconventional thinking, and the consideration of a broad range of alternatives – a strong case for pluralism. And that is what this final What Next volume is all about."
Contributors include Manfred Max-Neef, Vandana Shiva and Wendy Harcourt. Niclas Hallstrom's Introduction affirms that "all actors - governments, business, academia, media - have important roles to play, but little will happen unless concerned and organised citizens act, and act effectively and strategically, thereby pushing and moving the other actors".
5. NEXT NEWSLETTER
During the next few months I plan to complete a book on money system reform, with a practical core as summarised at 2.1. above. So my next newsletter may not come out until after Easter. But I know what happens to "the best laid plans of mice and men ..... ".
11th January 2010
| 18 gennaio 2010 |
Le banche e la crisi. Storia, etica, problemi, soluzioni
THE DETROIT PLANE BOMBING - SOME COMPONENTS MADE IN ISRAEL
by Barry Chamish
Israel is under deep threat from the diplomatically reckless Obama administration. Its saving bet is the American people; and their anti-Islamic attitude has to be enflamed again.
The Islamic world is equally threatened by the medieval spread of sharia extremism. Israel monitors its planned attacks and when useful, gives them a push.
It's a filthy underworld with innocent victims.
Gathering intelligence from my past and from current informants, I smelled the rat lifting its head from the sewage, after the Christmas Day, Detroit plane bombing. Here's what I wrote:
Menachem Atzmon, convicted in Israel in 1996 for campaign finance fraud, and his business partner Ezra Harel, took over management of security at the Boston and Newark airports when their company ICTS bought Huntleigh USA in 1999. UAL Flight 175 and AA 11, which allegedly struck the twin towers, both originated in Boston, while UAL 93, which purportedly crashed in Pennsylvania, departed from the Newark airport. This convicted Likud criminal's firm was in charge of security at Logan Airport inspecting the validity of passports and visas, searching cargo, screening passengers when two airliners were hijacked from there on Sept. 11, 2001, and demolished the World Trade Center towers in New York.Without Atzmon in charge of Newark and Logan Airports, 9-11 could NOT HAVE HAPPENED. Later adding: The same goes for Schiphol on Dec. 24/09.
Then, look what arrived at my desk:
Israeli Firm Responsible for Amsterdam Airport Security Where
Terrorist Boarded Airport
An Israeli firm is responsible for security inspections in the
airport in Schiphol, Holland, the airport where Umar Farouk
Abdulmutallab boarded the Airbus 330 heading for Detroit (USA). The
Israeli company, ICTS, is reportedly one of the leaders in security,
& operates in Amsterdam and a number of other European countries.
ICTS was established in 1982 and today employs 11,000 security
personnel in 22 countries. Many airports and airlines seek the
Israeli expertise and opt for ICTS to provide security for passengers
and employees. According to Rom Langer, the director of the company, who granted
Channel 2 News an interview on motzei shabbos, the terrorist did
undergo a security inspection in Amsterdam, but he does not have the
information pertaining to the inspection. When asked about the fact that the suspect attempted to set fire to
the aircraft, Langer responded, "You too can set the seat on fire,
using a lighter". Schiphol is among the busiest airports in Europe, with many
passengers from Africa and Asia passing through, making their way to
North America. Security is reportedly stringent, and passengers are
limited regarding quantities of liquids and other substances
permitted on a flight.
Two weeks before the rest of the investigators, I had it right. Then others saw the rat:
WASHINGTON, DC Officials in the Obama White House are considering the possibility that the Christmas day attempt by Nigerian terrorist Umar Farouk Mutallab to blow up an airliner about to land in Detroit was deliberately and intentionally facilitated by unnamed networks inside the US intelligence community. This was the gist of a report by Richard Wolf delivered in this evening’s edition of cable network MSNBC’s Countdown program, hosted by Keith Olbermann. This report comes on the eve of a special White House interagency conference convoked by Obama to deal with the massive systemic failure of US intelligence in allowing the Yemen alumnus Mutallab to board the Amsterdam to Detroit flight while allegedly carrying a PETN explosive device on his person. Wolf attributed his account to top officials in the Obama White House. The intentional sabotage of US antiterrorist screening procedures would explain why Mutallab had been able to use his US visa, escape interrogation and special searches, and board his flight, even though he was festooned with every red flag in the annals of airport security...
"ICTS is also linked with Israeli espionage against the United States. An ICTS board member, retired Major General Amos Lapidot, served as commander of the Israeli Air Force and authorized Israeli Air Force Colonel Aviem Sella, operating under official cover at the Israeli Consulate General in New York, and Rafael Eitan, head of LAKAM, an Israeli military technical intelligence gatherer, to accept U.S. Navy intelligence official Jonathan Pollard's offer to spy for Israel."
December 26-29, 2009 -- Who let security fail at Schiphol Airport and why?
Umar Farouk Abdul Mutallab, the University College London student from Nigeria accused of trying to detonate a mixed liquid-powder device on a Northwest Airlines/Delta Airbus 330, flight 253, as it approached Detroit from Amsterdam's Schiphol Airport on Christmas Day appears to have received some special treatment from security at the Amsterdam airport. The Mutallab case also resembles that of another attempted plane bombing, that of the hapless "shoe bomber" Richard Reid.
It has also been revealed that Mutallab is the son of Alhaji Umaru Mutallab, the former chairman of First Bank of Nigeria. According to This Day of Lagos, the elder Mutallab claims he reported the extremist views of his son to Nigerian security agencies, as well as to the U.S. embassy in Abuja, yet no attempt was made to prevent the radically-inclined Nigerian student to board the plane in Schiphol. The attempted plane bomber was schooled at the British International School in Lome, Togo and attended college in London and moved to Egypt and Dubai. The elder Mutallab is a frequent visitor to the United States and he is married to a Yemeni woman. ...
For a number of years, passengers at Schiphol flying to the United States have been subjected to intense grilling by security personnel linked to an Israeli firm. In fact, these procedures were in effect even prior to the 9/11 attacks and many were put into place after the Pan Am 103 bombing in December 1998. U.S.-bound passengers at Schiphol are asked a number of personal questions, including where they have stayed either in the Netherlands or in their country of origin. Hotel receipts are routinely requested by security personnel and the addresses of private temporary residences are recorded. Mutallab boarded a KLM flight in Lagos for Schiphol where he transited for his onward flight to Detroit on Northwest/Delta.
Six months prior to Reid's near shoe bombing of American Airlines flight 63 from Paris to Miami in December 2001, while memories of 9/11 were still fresh in everyone's mind, Reid attempted to board an El Al flight from Schiphol to Tel Aviv. Reid was taken aside by El Al security and identified as a terrorist suspect. Reid paid for a one-way ticket with cash and would not reveal what he planned to do in Israel. However, rather than turning Reid into Dutch security for further action, he was allowed to board the El Al flight by Israel's Shin Bet security so his movements during his five days in Israel could be monitored. Six months later, Reid attempted to ignite his shoe on the flight from Paris to Miami. Israel had not informed British, American, or any other security agency of the concerns about Reid. Reid's aunt, Claudette Lewis who raised Reid in south London, was quoted as saying she believed her nephew had been "brainwashed."
Reid later said El Al failed to detect that he had explosives in his shoes on the flight to Tel Aviv, an amazing revelation considering the Israeli airline's tight security. .. The links between El Al security and Mossad are extremely close with abundant cross-pollination of senior personnel back and forth. The security company that allowed Reid to board American Airlines 63 at Charles de Gaulle airport in Paris was ICTS (International Consultants on Targeted Security) International. ICTS's senior management are all ex-Israeli security officials, many of whom worked for El Al security. It was ICTS that largely developed the passenger "profiling" procedures used at Schiphol and other airports around the world through its subsidiary, ICTS Holland Products BV.
The ugly underworld of intelligence trapped Israel into making hopeless concessions to the PLO, and if the trends stay on course, to Hamas in time. Into this swell of appeasement, religious Jews and "settlers" are to be removed from the equation like so much human refuse. With half their nation on the chopping block, the Israeli ruling establishment, still has to infiltrate the real enemy to survive:
Yemeni President Ali Abdullah Saleh has said the security forces have arrested a group of alleged Islamist militants linked to Israeli intelligence.
Mr Saleh did not say what evidence had been found to show the group's links with Israel, a regional enemy of Yemen.
"A terrorist cell was arrested and will be referred to the judicial authorities for its links with the Israeli intelligence services," Mr Saleh told a gathering at al-Mukalla University in Hadramawt province.
Mr Saleh did not identify the suspects, but official sources were quoted saying it was same cell - led by a militant called Abu al-Ghaith al-Yamani - whose arrest was announced a week after the attack.
An Israeli foreign ministry spokesman said the Yemeni president's statement was without foundation.
"To believe that Israel would create Islamist cells in Yemen is really far-fetched. This is yet another victory for the proponents of conspiracy theories," Igal Palmor said in remarks reported by AFP.
Vancouver is a dull city whose residents think they have the most exciting lives in the world. So they brought in the Olympics to prove it. If recent history is any guide, they just might, but not in the way they intended. As a reader notes: "The Israeli company Verint which is connected to ICTS and of course Israeli Comverse (thus Odigo), is doing the security for the Vancouver Airport where the Olympics are being held this year. Stay out of Vancouver, Barry."
THE RECESSION HAS ARRIVED FOR MY READERS...AND ME.
Readers who have supported my work for years now write that they have lost jobs, investments, even homes. They apologize to me, they ask me to understand. And I do. More, I appreciate their readership as much as ever. Without their support, who would do my kind of research? Just this month, support from Aliza and Carl, allows me to write for another month.
But it's starting to get pretty tight around here.
If your situation is stable, remember me and what I do...
Finally my new two DVD set, Media Madness In The Middle East has been mailed, and kudos are starting to arrive. From Oregon:
thank you for your new cd, Barry! i liked the new and detailed info. when you peel the layers off Israel's onion to the cfr, then you know the same group juggles the usa and the whole kit and kaboodle. glad you're digging for the truth.
You'll be proud to show this set to everyone you know. It's just $18 plus postage by writing me at email@example.com
Hebrew readers, I released a four hour DVD containing two Hebrew lectures. The Rabin speech is finally in DVD format but more important, also within is my address in Kiryat Arba on the outside forces out to destroy the nation. It’s a difficult concept for the audience to grasp, but for the first time, it’s spelled out in Hebrew. AND, I received a supply of Hebrew books; Who Murdered Yitzhak Rabin, Save Israel, and The Last Days Of Israel. Til the supply runs out you get the books and the DVD for $20, plus postage.
I liked it very much … and I already passed to couple friends of mine. But – as always – there are people who
Are doing everything possible in order not to hear and not to see and today I leave them alone.
So, if it is so as your friend Barry claims, why Icchak Rabin’s son and daughter hugging and kissing Shimon Peres
publicly on TV? Why they meet him on so many occasions if they are aware that he is behind the murder of their father?
Why Sharon’s family behave the same way? Are all those families afraid that Shimon will kill them too?
Why nobody except Barry Chamish is writing openly on it? Are all Israeli journalists afraid of him?
Those are the questions I have to answer to all those to whom I pass your message. And believe me – all are intellectuals.
As for my modestly paid newsgroup, from K.G.: "An outstanding mix of news unreported and even humor. It keeps me up with a world I'd never known."
You're invited to join.
My Paypal address is firstname.lastname@example.org or write me.
Saint Augustine, FL 32080
My new book, THE conPROMISED LAND can be ordered direct from the publisher http://www.lulu.com/content/paperback_book/the_conpromised_land/6398777
- For those in the know, I present the following without comment:
- Terra Incognita: The first economic peace in the Holy Land
- Jan. 6, 2010
- Seth Frantzman , THE JERUSALEM POST
- One of the cornerstones of Prime Minister Binyamin Netanyahu's policy has been his belief that economics is an integral part of any peace process. He has claimed that "we must weave an economic peace alongside a political process... [It] will support and bolster the achievement of political settlements down the line."
- The idea that free-market principles and a strong economy mitigate both nationalism and political extremism - especially the resort to violence - has long been a staple of those who argue for democratization and free trade. What Netanyahu and his advisers may not know is that the theory of economic peace has been alive and well in the Holy Land since the 19th century, among Jewish, Arab and Christian Masons.
- Few are aware of the connections that exist between Masons, Jews and the conflict in the Middle East. The fascists, such as Francisco Franco, and the Nazis were fervently anti-Mason. The militant Islamist movement has typically seen the Masons as a threat. Hamas describes Freemasonry as a "secret society" controlled by Zionism, and the term "Freemason" is mentioned three times in the Covenant of Hamas adopted in 1988. Israel's most potent enemy in the 1960s, Egyptian leader Gamal Abdel Nasser, closed all the Masonic lodges of Egypt in 1962.
- THE MASONS are an international fraternal order whose beginnings are traced to Scotland in the 16th century. The movement spread quickly to England and thence to the Americas, where many of the founders were Masons. Freemasonry has been influential in inspiring westernization and secularism among military and political elites in such diverse places as Mexico, Russia and Liberia. However, it has been perceived as deeply threatening to religious groups and conspiracy theorists.
- Since its inception, Freemasonry has welcomed Jews as members, and initially most Jewish Masons were from prominent Sephardi families. One of these, Moses Montefiore, is important because of his connection to 19th-century Palestine, where he helped improve the living conditions of local Jews. However, the first Masonic ceremony held in Jerusalem was conducted by a Kentucky-born Mason named Robert Morris at the Cave of Zedekiah (popularly known as King Solomon's Quarries) near Damascus Gate in east Jerusalem. Another Masonic lodge, the Royal Solomon Mother Lodge, was founded in Jaffa in 1873 by American settlers of the Adam's colony. The colony failed, and the lodge was maintained by Rolla Floyd, a survivor of the colony. Another lodge was founded in 1890 in Jaffa by middle-class Jews and Arabs.
- The Masonic lodges at this time included Jewish and Arab notables. One example of these, according to an article written by Israeli Mason Leon Zeldis, was a Christian Arab hotel owner named Iskander Awad who was also an agent for the Thomas Cook travel agency. Lodges were founded in Haifa (1911) and Jerusalem (1931), and in each case the membership was composed of leading Jews, Arabs and Europeans.
- Dr. Daniel Farhey, a Mason based in Haifa, has written that "Freemasonry is one of the few institutions that actively promotes better understanding between the different ethnic and cultural segments of Israel society, particularly between Jewish and Arab brethren, and also assists in the social integration of immigrants."
- DURING THE British Mandate, the Masons in Palestine experienced a huge influx of British members. It may be no surprise that many of the leading voices behind the establishment of the Mandate, such as Lord Arthur Balfour, and Mandatory administrators such as High Commissioner Herbert Samuel were Masons. The lodge in Jerusalem attracted Jerusalem's business and political elite, among them David Abulafia (Sephardi Jewish leader), Daniel Auster (a General Zionist politician and Jerusalem mayor), the Yeshaya family (Jewish businessmen), S.T. Rock (Arab Catholic businessman), Nagib Mansour (Christian Arab engineer) and members of the Muslim elite who, according to information supplied to the author, may have included the Dajani family. This was a coexistence fraternity based on shared economic values.
- Reports from the period state that the lodges "stand for peace." A clipping from The Palestine Post published in 1939 describes the death of Samuel Hashimshoni, who was a "fine exponent of Masonry" and who did not travel with a firearm "as an example to his colleagues of his faith in his fellow man. He maintained and sought contacts with Arab friends."
- Prof. Ruth Kark of the Hebrew University and Dr. Joseph Glass have documented how the Sephardi Valero family were prominent Masons and maintained close relationships with Arabs throughout the Mandate. This was the essence of Freemasonry in the Holy Land, and is maintained today in the Grand Lodge in Israel where the Koran, Bible and Torah are displayed together.
- FREEMASONS HAVE been integral to the Land of Israel from the time of Charles Warren (archeologist in 19th-century Jerusalem) to the continued activities of the dozens of lodges, including eight in Jerusalem alone.
- However as history has shown, the early attempts at "economic peace" enshrined in the Masonic ideology did not prevent the 1948 war. Communal leaders like Abulafia, Auster and their Arab counterparts stood by as war engulfed their communities.
- The question is whether Netanyahu will be more successful at achieving economic peace than his forebears.
- http://www.jpost.com /servlet/Satellite?cid=1262339404266&pagename=JPArticle%2FShowFull
- Copyright 1995- 2010 The Jerusalem Post - http://www.jpost.com/
giovedì 7 gennaio 2010
CLASS ACTION: ADUSBEF, SU UNICREDIT E BANKITALIA DECIDERANNO GIUDICIultimo aggiornamento: 07 gennaio, 2010
Roma, 7 gen. (Adnkronos)- "Saranno i giudici a decidere stavolta sulla fondatezza di una class action pilota promossa dall'Adusbef contro Unicredit e Bankitalia Spa, sull'ammortamento fraudolento alla francese dei mutui, che arreca tangibile danno ai consumatori, entrando nel merito delle questioni sollevate e non, come ricorda Palazzo Kock in una stonata difesa d'ufficio del 'sistema bancario', sulle 1.200 cause intentate, nel periodo 2004 e 2005 sul signoraggio, sempre promosse da Adusbef, quando la sentenza di Cassazione richiamata non entro' nel merito delle azioni giudiziarie, limitandosi ad affermare l'assenza dei presupposti ad agire sulle politiche monetarie". Lo afferma in una nota il presidente di Adusbef, Elio Lannutti.
Iceland's credit rating downgraded after veto of the Icesave deal prompts fears of delays in IMF program
Telegraph, 6 January 2010
Facing a new wave of social and economic bedlam under the IMF: Jamaica's dilemma
Carib World News, 28 December 2009
Still lost in the old Bretton Woods
Financial Times, 27 December 2009
Coal for Christmas: the World Bank is still subsidizing one of the world's dirtiest fuels
Foreign Policy, 22 December 2009
mercoledì 6 gennaio 2010
BBC, 5 January 2010
Iceland leader vetoes bank repayments bill
Iceland's president has refused to sign a controversial bill to repay $5bn (£3.1bn) to the UK and the Netherlands.
President Olafur Ragnar Grimsson said he would instead hold a referendum on the bill, following public protests.
The legislation was designed to compensate governments forced to bail out their savers with Icesave accounts following Iceland's banking collapse.
Opponents argue the terms of the payments will unfairly hurt Iceland and its recovery from economic crisis.
Some reports say those opponents form a large majority of Icelanders - some 70% are said to be likely to vote "no" in a referendum.
Legislation to repay the money was approved by Iceland's parliament in December, but the approval of the president is also required before it can be passed into law.
It is now up to the government to decide how to proceed. It must consider whether to go ahead with a referendum or whether to withdraw the bill and reopen negotiations with the UK and the Netherlands about a repayment schedule.
The right to choose
The government has seen significant public opposition to the bill.
THE STORY SO FAR...
Early October 2008: Icelandic banks collapse forcing the government to take control
October 2008: Amid a bitter row with Iceland over who should pay, UK and the Netherlands promise to compensate their nationals who have Icesave accounts
November 2008: IMF approves $2.1bn loan for Iceland. Financial support from other countries brings total amount to $10bn.
June 2009: Iceland's new government agrees to reimburse UK and Netherlands
August 2009: Icelandic parliament approves first Icesave bill detailing payment schedule
September 2009: UK and the Netherlands reject payment terms
December 2009: Amended bill with more stringent conditions approved by parliament
On Saturday, the president received a petition calling for the bill to be vetoed, signed by almost a quarter of the country's population.
Campaigners against the bill say that the Icelandic public are being forced to pay for the mistakes of banks.
The total compensation package equates to about 12,000 euros ($17,300; £10,800) per Icelandic citizen.
Announcing the decision to hold a referendum on the bill, President Grimsson said that the Icelandic public had the right to choose.
"It is the job of the president of Iceland to make sure the nation's will is answered," he said.
"I have decided... to take the new law to the nation. The referendum will take place as quickly as possible."
In response to the decision, the Icelandic parliament, which approved the new bill last month, said the move could further tarnish Iceland's image abroad.
By Ingibjorg Thordardottir, BBC News
The president's decision to call a referendum on the Icesave law is likely to be met with mixed reactions by the Icelandic people. Many believe Iceland is paying too much back to Britain and the Netherlands and want the law courts to decide what the fair repayment amount should be.
Others say that passing the law is fundamental to Iceland's economic recovery - especially since bodies like the IMF and the Nordic countries have said they will not release much needed loans unless an Icesave agreement is finalised.
The decision is a blow to the Icelandic government which sees the legislation as a vital step in Iceland's economic recovery. It will now have to decide whether to withdraw the bill and try to renegotiate a different deal with the UK and the Netherlands or to go ahead with a referendum.
The prime minister has already made it clear that Iceland will honour its international obligations but has not said how that will be done. But the president says that a referendum is the the only way for there to be a fair and conclusive result for the Icelandic people to this drawn-out crisis.
"Uncertainty... in the formal dealings with others countries can have unforeseen, wide-ranging and potentially damaging consequences for our society," warned Johanna Sigurdardottir, Iceland's Prime Minister.
The Treasury's City Minister, Lord Myners, said he shared the Icelandic parliament's disappointment, and warned the public against voting against the bill in the referendum
"The Icelandic people, if they took that decision, would effectively be saying that Iceland doesn't want to be part of the international financial system," he said.
The Dutch government said Iceland was still "compelled to pay back the money".
BBC Brussels correspondent Dominic Hughes said the longer-term impacts of the decision could be significant for both political and economic reasons.
"It's seen as a blow to the country's hopes of a quick entry to the European Union," he said.
"In fact, the whole debate has soured feeling in Iceland towards the EU.
"It also throws doubt on further aid payments to Iceland from international lenders."
Iceland's credit status has already taken a knock. One agency that grades the fitness of a country's finances, Fitch Ratings, has put the country's debt rating at "junk" status, meaning it must pay a higher interest rate to attract borrowers who are not certain to be paid back.
The crisis in Iceland's banks forced it to borrow billions of dollars from the International Monetary Fund (IMF) - loans made on the condition that the issue of Icesave compensation would be resolved.
Quando la moneta era d’oro, lo stato aveva la sovranità monetaria perché la moneta, sin dall’emissione, era proprietà del portatore. Dei valori monetari partecipava tutta la collettività secondo il principio della società organica che è la proiezione storica dell’apologo di Menenio Agrippa: lo stomaco gode della sua funzione a parità di condizioni con tutte le membra.
Con l’avvento dello stato costituzionale, la quarta funzione dello stato è stata assunta dai grandi usurai. Ciò spiega perché la Rivoluzione Francese fu promossa dalla Banca d’Inghilterra e dall’eresia protestante che entrò in Europa continentale non con la fondazione di una “chiesa”, ma di una “banca”: la Banca Protestante presieduta dal Necker, consigliere finanziario di Luigi XIV.
I banchieri ben sapevano che il valore sta nel “tempo” non nello “spazio”: è una “previsione” e non una “merce”, tanto è vero che la moneta ha un valore arbitrariamente illimitato, anche se il simbolo è di costo nullo (carta). Anche il valore dell’oro non stava nel metallo, ma nella “previsione di poter comprare”.
Facendo leva sul riflesso condizionato causato dall’abitudine secolare di dare sempre un corrispettivo per avere denaro, le banche centrali hanno emesso la moneta col corrispettivo del debito, cioè “prestandola”. In tal modo i grandi usurai non si sono solo limitati ad espropriare i popoli dei valori monetari, ma li hanno indebitati di altrettanto, caricando, sin dall’origine, il costo del denaro del 200%. In tal modo le monarchie cattoliche della vecchia Europa sono crollate perché trasformate da “proprietarie” in “debitrici” del proprio denaro. I banchieri si sono comprati i re, digiuni di cultura monetaria, con il corrispettivo del debito, cioè “arricchendoli” di “moneta-debito”: la c.d. “moneta nominale”.
Quando la moneta era d’oro chi trovava la pepita se ne appropriava senza indebitarsi verso la miniera e questa regola valeva per tutti: re, nobili e plebei.
Con l’avvento dello stato costituzionale, al posto della miniera sta la banca centrale, al posto della pepita un pezzo di carta, al posto della proprietà il debito perché la banca emette moneta solo prestandola e la moneta circola gravata del debito non dovuto al signoraggio bancario.
Con un costo iniziale del denaro, all’origine, del 260% comprensivo di capitale ed interessi, si è resa impossibile la puntualità dei pagamenti. È nata così l’epidemia del “suicidio da insolvenza” che non ha precedenti nella storia e che è il segno dell’avvento dell’usurocrazia.
Le vicende scandalose dei drammi economici, che hanno dilaniato la società del nostro tempo, impongono ormai l’assoluta, inderogabile necessità, di considerare nella costituzione la funzione monetaria dello stato. Fino ad oggi ciò non era possibile perché mancavano i due cardini fondamentali della scienza monetaria: a) la definizione del valore monetario come valore indotto, e b) la legge della rarità monetaria che, in sintesi, sono i seguenti: a)Il valore indotto - Posto che ogni unità di misura ha la qualità corrispondente a ciò che deve misurare, come il metro ha la qualità della lunghezza perché misura la lunghezza, la moneta ha la qualità del valore perché misura il valore e la qualità della rarità perché sono rari (economici) i beni di cui misura il valore.. La moneta è pertanto misura del valore e valore della misura che è il potere d’acquisto che basa sulla previsione di poter acquistare (creata per convenzione come ogni misura) e non sulla riserva. b) La legge della rarità monetaria. Poiché il prezzo di mercato non è solo l’indice del valore dei beni, ma anche del punto di saturazione del mercato – per cui il mercato è saturo quando i prezzi tendono a coincidere con i costi di produzione - solo quando questa coincidenza tende a verificarsi, occorre fermare sia la produzione dei beni che l’emissione monetaria.
Su questi fondamentali principi è possibile concepire la funzione monetaria come quarto potere dello stato costituzionale perché consentono di definire il “dover essere” dell’organo monetario. All’attuale “arbitrio” dei governatori delle banche centrali va sostituita la “discrezionalità tecnica” di una funzione organica, esattamente definita ed eticamente e giuridicamente limitata e finalizzata al bene comune, non a quello dell’usura.
L’emissione e l’utilizzazione della moneta vanno programmate sulle finalità di interesse pubblico e privato senza alcun problema di rarità perché – liberata la moneta (con la scoperta del valore indotto) dall’equivoco della riserva (peraltro abolita dal 15 agosto 1971) – l’emissione monetaria va commisurata alla quantità dei beni e servizi misurati e misurabili nel valore, considerando come tali, non solo i beni e servizi esistenti, ma anche quelli previsti. La previsione dei beni producendi è, di per se, un bene (Si pensi ad es. al valore di un brevetto).
Per quanto riguarda la destinazione d’interesse pubblico, va evidenziato che – dichiarata la moneta di proprietà dei cittadini – lo stato dovrà trattenere all’origine quanto necessario per esigenze fiscali e di pubblica utilità, liberando i contribuenti dal peso di milioni di ore di lavoro banalmente distrutti per mere formalità contabili e amministrative.
Merita inoltre di essere evidenziato il comportamento delle banche centrali che pretendono di vantare, come pubblico interesse, la destinazione a “riserva” anche dei beni diversi dall’oro. La riserva aveva un significato quando la banconota era convertibile in oro a richiesta del portatore. È diventata ormai una ridicola sceneggiata, per mascherare la truffa dell’emissione con cui la banca centrale consegue un arricchimento parassitario pari alla differenza – duplicata dall’equivalente prestito – tra costo tipografico e valore nominale della moneta.
Per quanto riguarda la destinazione d’interesse privato, va precisato che ad ogni cittadino spetta, all’atto dell’emissione, la sua quota di “reddito monetario di cittadinanza”, in attuazione del disposto del 2° co. dell’art. 42 della Costituzione, che prevede l’accesso alla proprietà per tutti.
Si realizza in tal modo un diritto della persona con contenuto patrimoniale, non come elemosina di stato, ma come acquisto della proprietà, a titolo originario, perché ogni membro della collettività contribuisce a creare il valore convenzionale della moneta, per il solo fatto che l’accetta. Col reddito di cittadinanza si finanziano i produttori, finanziando i consumatori, che è l’unico modo razionale per evitare elargizioni di moneta in base a scelte arbitrarie e clientelari.
Sostituendo all’oro il simbolo cartaceo, la moneta nominale ha acquistato due qualità tra loro in contrasto, anche se non incompatibili: la rarità programmata ed il costo nullo che hanno dovuto operare nell’esperienza della circolazione monetaria esasperando la separazione culturale tra quelli che sanno: i padroni del signoraggio monetario, e quelli che non sanno: gli altri.
In conclusione, il quarto potere costituzionale deve essere concepito sulla finalità di restituire allo stato la funzione monetaria ed al popolo la proprietà della moneta. Questa riforma è diventata ormai indispensabile per uscire dall’asservimento al “signoraggio bancario” e dare inizio ad un regime di democrazia integrale in cui i popoli non abbiano solo la sovranità politica, ma anche quella monetaria, per vivere tempi nuovi a dimensione umana, liberi dall’angoscia dell’insolvenza ineluttabile dei debiti non dovuti alla grande usura.
martedì 5 gennaio 2010
(ANSA) - ROMA, 4 GEN - Le associazioni di consumatori Adusbef e Federconsumatori "hanno dato mandato ai loro legali di studiare una class action contro il sistema bancario che essendo proprietario della Banca d'Italia ne condiziona pesantemente le attività di ordine ispettivo". Lo indicano le due associazioni in una nota. Per Adusbef-Federconsumatori Bankitalia non è "mai intervenuta" per "rimuovere comportamenti fraudolenti e pratiche commerciali scorrette a danno dei consumatori ed utenti costretti nel tempo a pagare costi di accesso elevatissimi, i più cari di Europa, ai servizi bancari". Nella nota si accenna per esempio ai tassi di interesse praticati dalle banche italiane, "con un costo del denaro più elevato al Sud rispetto al resto del Paese, ed in generale più alto di un buon 0,50% sui mutui e di un +1,37% sui prestiti personali rispetto alla media praticata dalle banche europee".
"La Banca d'Italia non può continuare ad assumere il ruolo di notaio delle malefatte bancarie", scrivono Elio Lannutti per Adusbef e Rosario Trefiletti per Federconsumatori. Che spiegano: "Sono proprio i dati di Bankitalia su tassi,condizioni e loro variazioni, oltre alle segnalazioni al Parlamento effettuate nel tempo dall'Antitrust, suffragati da numerose sentenze di condanna ottenute dall'Adusbef in tutte le sedi di giudizio, fino alla Cassazione ed alla Corte Costituzionale in merito ai tassi anatocistici ed ai mutui usurari, ad ispirare una class action congiunta contro il sistema bancario, Abi in primis e la Banca d'Italia, per gravissima lesione dei diritti ed interessi dei consumatori ed utenti bancari". Infine "anche sulla odiosa prassi della commissione di massimo scoperto,resuscitata dalle banche in forme e modalità più onerose per aggirare il divieto di legge,ed oggetto di una corposa censura dell'Antitrust a Governo e Parlamento, Adusbef e Federconsumatori, promuoveranno una class action per punire comportamenti fraudolenti della generalità dei banchieri a danno dei consumatori".(ANSA)
lunedì 4 gennaio 2010
The recent proposal to vote with our feet by shifting our deposits from Wall Street to community banks is a great start. However, community banks are not suffering from a lack of deposits so much as from a lack of the capital they need to make new loans, and investment capital today is scarce. There is a way out of this dilemma, demonstrated for over 90 years by the innovative state of North Dakota -- a partnership in which community banks are backed by the deep pockets of a state-owned bank.
Our fearless editor and leader Arianna Huffington just posted an article that has sparked a remarkable wave of interest, evoking nearly 5,000 comments in less than a week. Called "Move Your Money," the article maintains that we can get credit flowing again on Main Street by moving our money out of the Wall Street behemoths and into our local community banks. This solution has been suggested before, but Arianna added the very appealing draw of a video clip featuring Jimmy Stewart in It's a Wonderful Life. In the holiday season, we are all hungry for a glimpse of that wonderful movie that used to be a mainstay of Christmas, showing daily throughout the holidays. The copyright holders have suddenly gotten very Scrooge-like and are allowing it to be shown only once a year on NBC. Whatever their motives, Wall Street no doubt approves of this restriction, since the movie continually reminded viewers of the potentially villainous nature of Big Banking.
Pulling our money out of Wall Street and putting it into our local community banks is an idea with definite popular appeal. Unfortunately, however, this move alone won't be sufficient to strengthen the small banks. Community banks lack capital -- money that belongs to the bank -- and the deposits of customers don't count as capital. Rather, they represent liabilities of the bank, since the money has to be available for the depositors on demand. Bank "capital" is the money paid in by investors plus accumulated retained earnings. It is the net worth of the bank, or assets minus liabilities. Lending ability is limited by a bank's assets, not its deposits; and today, investors willing to build up the asset base of small community banks are scarce, due to the banks' increasing propensity to go bankrupt.
It's a Wonderful Life actually illustrated the weakness of local community banking without major capital backup. George Bailey's bank was a savings and loan, which lent out the deposits of its customers. It "borrowed short and lent long," meaning it took in short-term deposits and made long-term mortgage loans with them. When the customers panicked and all came for their deposits at once, the money was not to be had. George's neighbors and family saved the day by raiding their cookie jars, but that miracle cannot be counted on outside Hollywood.
The savings and loan model collapsed completely in the 1980s. Since then, all banks have been allowed to create credit as needed just by writing it as loans on their books, a system called "fractional reserve" lending. Banks can do this up to a certain limit, which used to be capped by a "reserve requirement" of 10%. That meant the bank had to have on hand a sum equal to 10% of its deposits, either in its vault as cash or in the bank's reserve account at its local Federal Reserve bank. But many exceptions were carved out of the rule, and the banks devised ways to get around it.
That was when the Bank for International Settlements stepped in and imposed "capital requirements." The BIS is the "central bankers' central bank" in Basel, Switzerland. In 1988, its Basel Committee on Banking Supervision published a set of minimal requirements for banks, called Basel I. No longer would "reserves" in the form of other people's deposits be sufficient to cover loan losses. The Committee said that loans had to be classified according to risk, and that the banks had to maintain real capital - their own money - generally equal to 8% of these "risk-weighted" assets. Half of this had to be "Tier 1" capital, completely liquid assets in the form of equity owned by shareholders -- funds paid in by investors plus retained earnings. The other half could include such things as unencumbered real estate and loans, but they still had to be the bank's own assets, not the depositors'.
For a number of years, U.S. banks managed to get around this rule too. They did it by removing loans from their books, bundling them up as "securities," and selling them off to investors. But when the "shadow lenders" - the investors buying the bundled loans - realized these securities were far more risky than alleged, they exited the market; and they aren't expected to return any time soon. That means banks are now stuck with their loans; and if the loans go into default, as many are doing, the assets of the banks must be marked down. The banks can then become "zombie banks" (unable to make new loans) or can go bankrupt and have to close their doors.
The final blow to the easy credit provided by U.S. banks came with another stricture on capital, called Basel II. It manifested in the U.S. as the "mark-to-market" rule, which required a bank's loan portfolio to be valued at what it could be sold for (the "market"), not its original book value. In today's unfavorable market, that meant a huge drop in asset value for the banks, dramatically reducing their ability to generate new loans. When the announcement was made in November 2007 that this rule was going to be imposed on U.S. banks, credit dried up and the stock market plunged. The market did not begin to recover until 2009, when the rule was largely lifted. However, on December 17, 2009, the Basel Committee announced plans to impose even tighter capital requirements. The foreseeable result is the collapse of yet more community banks and the drying up of yet more credit on Main Street.
Where can our floundering community banks get the capital to make room on their books for substantial new loans? An innovative answer is provided by the state of North Dakota, one of only two states (along with Montana) expected to meet its budget in 2010. North Dakota was also the only state to actually gain jobs in 2009 while other states were losing them. Since 2000, North Dakota's GNP has grown 56 percent, personal income has grown 43 percent and wages have grown 34 percent. The state not only has no funding problems, but in 2009 it had a budget surplus of $1.3 billion, the largest it ever had -- not bad for a state of only 700,000 people.
North Dakota is the only state in the union to own its own bank. The Bank of North Dakota (BND) was established by the state legislature in 1919 specifically to free farmers and small businessmen from the clutches of out-of-state bankers and railroad men. Its populist organizers originally conceived of the bank as a credit union-like institution that would provide an alternative to predatory lenders, but conservative interests later took control and suppressed these commercial lending functions. The BND now chiefly acts as a central bank, with functions similar to those of a branch of the Federal Reserve.
However, the BND differs from the Federal Reserve in significant ways. The stock of the branches of the Fed is 100% privately owned by banks. The BND is 100% owned by the state, and it is required to operate in the interest of the public. Its stated mission is to deliver sound financial services that promote agriculture, commerce and industry in North Dakota.
Although the BND is operated in the public interest, it avoids rivalry with private banks by partnering with them. Most lending is originated by a local bank. The BND then comes in to participate in the loan, share risk, buy down the interest rate and buy up loans, thereby freeing up banks to lend more. One of the BND's functions is to provide a secondary market for real estate loans, which it buys from local banks. Its residential loan portfolio is now $500 billion to $600 billion. This function has helped the state avoid the credit crisis that afflicted Wall Street when the secondary market for loans collapsed in late 2007 and helped it reduce its foreclosure rate. The secondary market provided by the "shadow lenders" is provided in North Dakota by the BND, something other state banks could do for their community banks as well.
Other services the Bank provides include guarantees for entrepreneurial startups and student loans, the purchase of municipal bonds from public institutions, and a well-funded disaster loan program. When North Dakota failed to meet its state budget a few years ago, the BND met the shortfall. The BND has an account with the Federal Reserve Bank, but its deposits are not insured by the FDIC. Rather, they are guaranteed by the State of North Dakota itself - a prudent move today, when the FDIC is verging on bankruptcy.
A state-owned bank has enormous advantages over smaller private institutions: states own huge amounts of capital (cash, investments, buildings, land, parks and other infrastructure), and they can think farther ahead than their quarterly profit statements, allowing them to take long-term risks. Their asset bases are not marred by oversized salaries and bonuses, they have no shareholders expecting a sizable cut, and they have not marred their books with bad derivatives bets, unmarketable collateralized debt obligations and mark-to-market accounting problems.
The BND is set up as a dba: "the State of North Dakota doing business as the Bank of North Dakota." Technically, that makes the capital of the state the capital of the bank. The BND's return on equity is about 25 percent. It pays a hefty dividend to the state, projected at over $60 million in 2009. In the last decade, the BND has turned back a third of a billion dollars to the state's general fund, offsetting taxes.
By law, the state and all its agencies must deposit their funds in the bank, which pays a competitive interest rate to the state treasurer. The bank also accepts funds from other depositors. These copious deposits can then be used to plow money back into the state in the form of loans.
Although the BND operates mainly as a "bankers' bank," other publicly-owned banks, including the Commonwealth Bank of Australia, have successfully engaged in direct commercial lending as well. This has proven to be a win-win for both the borrowers and the government. The public bank model also offers exciting possibilities for refinancing the state's own debts and funding infrastructure nearly interest-free. For a fuller discussion, see "Cut Wall Street Out! How States Can Finance Their Own Recovery."
For three centuries, the United States has thrived on what Benjamin Franklin called "ready money" and today we call "ready credit." We can have that abundance again, by generating our own credit through our own state and local banks. Just as George Bailey needed a visit from an angel to point the way, so we just need the vision to see the possibilities.
Arianna's vision for moving our money from the large banks into our local community banks is a very admirable first step. However, those community banks are not likely to have sufficient capital to free up credit for their local businesses and other customers without the partnership of state-owned banks, or the publicly-owned banks of counties and larger cities, which also have ample capital assets. A number of states, counties, and cities are actively exploring this option. The BND model shows us how government-owned banks and community banks can work together to get money flowing back to Main Street again.
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The Economic Collapse - 2010-01-02
Investment banking giant Goldman Sachs has become perhaps the most prominent symbol for everything that is wrong with the U.S. financial system, but most Americans cannot even begin to explain what they do or how they have made tens of billions of dollars from the economic collapse of America. The truth is that what Goldman Sachs did was fairly simple, and there may not have even been anything "illegal" about it (although they are now being investigated by the SEC among others).
The following is how Goldman Sachs made tens of billions of dollars from the economic collapse of America in four easy steps....
Step 1: Sell mortgage-related securities that are absolute junk to trusting clients at vastly overinflated prices.
Step 2: Bet against those same mortgage-related securities and make massive bets against the U.S. housing market so that your firm will make massive profits when the U.S. economy collapses.
Step 3: Have ex-Goldman executives in key positions of power in the U.S. government so that bailout money can be funneled to entities such as AIG that Goldman has made these bets with so that they can get paid after they win their bets.
Step 4: Collect the profits - Goldman Sachs is having their "most successful year" and will end up reporting approximately $50 billion in revenue for 2009.
So is it right for the biggest fish on Wall Street to make tens of billions of dollars by betting that the U.S. housing market will collapse?
You see, when you are talking about a financial giant the size of Goldman Sachs, the line between "betting that something will happen" and "making something happen" gets blurred very quickly.
Not that Goldman Sachs was the only one betting against the housing market.
According to the New York Times, firms like Deutsche Bank and Morgan Stanley also created mortgage-related securities and then bet that they would fail.....
Goldman was not the only firm that peddled these complex securities — known as synthetic collateralized debt obligations, or C.D.O.’s — and then made financial bets against them, called selling short in Wall Street parlance. Others that created similar securities and then bet they would fail, according to Wall Street traders, include Deutsche Bank and Morgan Stanley, as well as smaller firms like Tricadia Inc.
But certainly Goldman Sachs was the most prominent financial player involved in this type of activity.
In fact, without mentioning specifics, Goldman has even admitted publicly to wrongdoing. On November 17th, 2008 Goldman Sachs CEO Lloyd Blankfein even issued a public apology....
"We participated in things that were clearly wrong and have reason to regret."
But complicated financial transactions are something that most Americans simply do not understand, so the public outrage towards Goldman Sachs and others has been somewhat limited. But that does not change the very serious nature of the activities that Goldman was involved in....
"The simultaneous selling of securities to customers and shorting them because they believed they were going to default is the most cynical use of credit information that I have ever seen," Sylvain Raynes, an expert in structured finance at R & R Consulting in New York,recently told The New York Times. "When you buy protection against an event that you have a hand in causing, you are buying fire insurance on someone else’s house and then committing arson."
But the sad thing is that many Americans do not even understand what Goldman Sachs is. Goldman Sachs was founded in 1869 and has forged a reputation as one of the elite financial institutions in the entire world. They only hire "the best and the brightest" and Ivy League graduates flock to the firm. Of the five major investment banks that dominated Wall Street before the crash, only Goldman Sachs and Morgan Stanley have survived. Merrill Lynch and Bear Stearns were severely damaged by the crash and ended up being purchased by retail banks and Lehman Brothers ended up folding.
There are persistent rumors that Goldman played a major role in the collapse of Bear Stearns and that ex-Goldman CEO Hank Paulson could have done much more to bail out Lehman Brothers, but perhaps nobody will ever know the full truth. All we do know is that at the end of the crash several of Goldman's competitors were destroyed and Goldman found itself in a more dominant position than ever.
The truth is that Goldman is a financial shark and they do not apologize for it.
An article in Rolling Stone recently put it this way....
"The first thing you need to know about Goldman Sachs is that it's everywhere. The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money."
So how did Goldman Sachs prosper so greatly in an environment that destroyed their competitors?
The following is an extended breakdown of just how Goldman Sachs was able to reap tens of billions of dollars in profits from the collapse of the U.S. housing market....
Step 1: Sell mortgage-related securities that are absolute junk to trusting clients at vastly overinflated prices.
In late 2006, Goldman Sachs made some fundamental changes in the way that they were approaching the U.S. housing market. According to a McClatchy report, Goldman spokesman Michael DuVally said that the firm decided at that time to reduce its mortgage risks by selling off subprime mortgage-related securities and by purchasing credit-default swaps to hedge against a serious downturn in the U.S. housing market.
The key moment came in December 2006. After "10 straight days of losses" in Goldman's mortgage business, Chief Financial Officer David Viniar called a meeting of key Goldman personnel.
Vanity Fair described the results of that meeting this way....
"After a now famous meeting in David Viniar’s office on December 14, 2006, Goldman’s traders began to protect the firm against further declines in the market. Just as you can short the S&P 500, the traders took short positions in an index that tracked the price of mortgage-backed securities. They also either sold assets they owned to others at losses or dramatically marked down the price on their own books. In the aftermath of the crisis, criticism erupted that Goldman had continued to sell mortgage-backed securities to its clients while betting against those very securities for its own account. Clearly, in the simplest terms possible, this is true: while Goldman was never the biggest underwriter of C.D.O.’s (collateralized debt obligations—Wall Street’s vehicle of choice for mortgage-backed securities), the firm did remain in the top five until the summer of 2007, when the market crashed to a halt."
So Goldman Sachs proceeded to sell approximately $39 billion of its own mortgage securities in 2006 and 2007 and they sold at least $17 billion more mortgage securities for others, but they never told the buyers of those securities that Goldman was secretly betting that a significant drop in U.S. housing prices would send the value of those mortgage securities plummeting.
These sales and the massive clandestine wagers placed by Goldman enabled the firm to pass most of its potential losses on to others prior to the collapse of the U.S. housing market.
But many of the investors who got the short end of the stick were not pleased. When they discovered that what Goldman had promoted as triple-A rated investments were actually a bunch of garbage, many of them were absolutely furious.
"The Securities and Exchange Commission should be very interested in any financial company that secretly decides a financial product is a loser and then goes out and actively markets that product or very similar products to unsuspecting customers without disclosing its true opinion," said Boston University economics professor Laurence Kotlikoff. "This is fraud and should be prosecuted."
One of the victims of this fraud was the state of Mississippi....
"Mississippi Attorney General Jim Hood, whose state has lost $5 million of the $6 million it invested in Goldman's subprime mortgage-backed bonds in 2006, said the state's funds are likely to lose "hundreds of millions of dollars" on those and similar bonds."
Another one of the victims of this fraud was California's retirement system for public employees....
"California's huge public employees' retirement system, known as CALPERS, purchased $64.4 million in subprime mortgage-backed bonds from Goldman on March 1, 2007. While that represented a tiny percentage of the fund's holdings, in July CALPERS listed the bonds' value at $16.6 million, a drop of nearly 75 percent, according to documents obtained through a state public records request."
So who is left holding the bag in cases such as these?
And that is just fine with Goldman Sachs. Just as long as they keep raking in huge profits.
Vanity Fair was even more blunt regarding this injustice....
"Goldman’s management team was almost flawless in its execution. But how many people needed government help because of the things Goldman sold them?"
The truth is that a lot of people needed help because of the things Goldman sold them, but up until now Goldman has completely gotten away with it.
Step 2: Bet against those same mortgage-related securities and make massive bets against the U.S. housing market so that your firm will make massive profits when the U.S. economy collapses.
Not only did Goldman sell mortgage-related securities that were absolute junk to investors at vastly overinflated prices, they also placed massive bets that the U.S. housing market would absolutely collapse.
The New York Times recently described how Goldman used a new index known as the ABX to make many of these bets....
"A handful of investors and Wall Street traders, however, anticipated the crisis. In 2006, Wall Street had introduced a new index, called the ABX, that became a way to invest in the direction of mortgage securities. The index allowed traders to bet on or against pools of mortgages with different risk characteristics, just as stock indexes enable traders to bet on whether the overall stock market, or technology stocks or bank stocks, will go up or down.
Goldman, among others on Wall Street, has said since the collapse that it made big money by using the ABX to bet against the housing market. Worried about a housing bubble, top Goldman executives decided in December 2006 to change the firm’s overall stance on the mortgage market, from positive to negative, though it did not disclose that publicly."
These bets would only make money for Goldman Sachs if the U.S. housing market declined.
So if the biggest giant on Wall Street has a huge financial incentive to see the U.S. housing market fail, what do you think the odds are that they are going to do anything to support it?
Step 3: Have ex-Goldman executives in key positions of power in the U.S. government so that bailout money can be funneled to entities such as AIG that Goldman has made these bets with so that they could get paid.
For years, Goldman Sachs has encouraged executives to serve in U.S. government positions. Now they are world famous for the amount of influence their former employees have over government policy.
For example, according to the New York Times, Treasury Secretary Hank Paulson (also a former Goldman CEO) spoke with the current CEO of Goldman Sachs about two dozen times during the week of the bailout, although Paulson says that he obtained an "ethics waiver" before doing so.
So does an "ethics waiver" make everything okay?
But the sad thing is that is not an isolated example.
It turns out that Goldman benefited greatly from a number of decisions made by their former CEO while he was Treasury Secretary....
*Goldman greatly benefited when Paulson elected not to save rival Lehman Brothers from collapse. Paulson certainly stepped in to help Fannie Mae, Freddie Mac and AIG, but apparently had no problem with letting Lehman Brothers fall apart.
*Under Paulson's direction, Goldman ended up receiving bailout money (which they may or may not have needed) from the U.S. government and has since paid back much of that money with interest. So why didn't Bear Stearns or Lehman Brothers get the bailout funds that they needed?
*Goldman greatly benefitted when Paulson organized a massive rescue of American International Group while in constant telephone contact with Goldman CEO Blankfein. AIG ultimately ended up using $12.9 billion taxpayer dollars to pay off every single penny that it owed to Goldman.
But it is not just Paulson who has had significant influence in Washington.
On October 16th, Adam Storch, a Goldman Sachs vice president, was named managing executive of the SEC's enforcement division. What do you think the odds are that he will crack down hard on Goldman?
In addition, former Goldman Sachs lobbyist Mark Patterson is the chief of staff for current Treasury Secretary Timothy Geithner.
In fact, ex-Goldman employees are seemingly everywhere. According to Vanity Fair, at one G-7 meeting an anonymous source identified at least 24 out of 32 finance officials in attendance as ex-Goldman employees.
The influence of Goldman Sachs even reaches to the White House. Goldman was Barack Obama's number one campaign donor, and its employees gave $981,000 to his campaign.
If you don't think that kind of money does not buy influence then you are delusional.
Goldman used some of that powerful influence to get the U.S. government to bail out AIG so that AIG could pay off the bets that Goldman had made with them. In a recent article, Vanity Fair described part of what went down....
"After the government bailout of A.I.G., in order to end the collateral calls on the insurance giant, the New York Federal Reserve—whose chairman at the time was former Goldman chairman Steve Friedman—decided to purchase a slew of the securities that A.I.G. had insured, including $14 billion of those on which Goldman had purchased insurance. The government—meaning taxpayers—did so at full price, although according to a recent Bloomberg story, there had been negotiations with A.I.G. to do so at a 40 percent discount. Goldman says that the New York Fed broached the topic of a discount only once. The firm’s response: a flat no. While no one will ever know what would have happened had A.I.G. gone under, the essence of what did happen is perfectly clear. As a recent report by the Office of the Special Inspector General for tarpput it, the decision to pay full price “effectively transferred tens of billions of dollars of cash from the Government to A.I.G.’s counterparties.” Or to put it another way: because Goldman felt it was owed its billions by A.I.G., the firm took it from taxpayers instead."
So what about all of the thousands of small businesses that are failing and what about the millions of Americans that are losing their jobs and homes?
Do they get bailouts?
Of course not.
But the U.S. government definitely made sure that AIG and Goldman were taken care of.
Step 4: Collect the profits - Goldman Sachs is having their "most successful year" and will end up reporting approximately $50 billion in revenue for 2009.
Goldman Sachs ranks #1 in annual net income when compared with 86 peers in the investment services sector. They are on course for their best year ever.
Yes, they are having a really good "crisis".
Goldman Sachs is on course to surpass $50 billion in revenue in 2009 and to pay its employees more than $20 billion in year-end bonuses.
20 billion just in bonuses?
That would mean that the average bonus for all Goldman employees would be over $700,000.
No wonder everyone wants to work for them.
It's good to be on the winning side.
So just how are they making so much money?
In their recent article, Vanity Fair described it this way....
"But because so many of Goldman’s competitors were gone or disabled, spreads—the difference between the price at which you sell and buy a variety of securities—were wider than they had been in years, meaning that Goldman could practically mint money. By acting at the moment it did, with Lehman out and Merrill Lynch down for the count, the government enabled this situation.
The other reason for Goldman’s profits is that the government has flooded the system with money, not just the money it used to rescue the financial system but hundreds of billions more in stimulus, in support of the housing market, and in the Federal Reserve’s purchases of securities."
But all of this success has not come without controversy. In fact, Goldman executives are very much aware of the growing backlash against the firm.
Senior officials at Goldman Sachs have reportedly loaded up on firearms and are now equipped to defend themselves if there is a "populist uprising" against the bank.
In addition, Goldman Sachs employees are now not allowed to gather in groups of 12 or more outside the office. The firm very much discouraged "holiday parties" as they most definitely did not want to be seen as celebrating the downfall of the U.S. economy.
But the truth is that Goldman Sachs won because so many others lost.
In his very revealing article on Goldman Sachs in Rolling Stone, Matt Taibbi described how Goldman keeps making money from the bursting of these economic bubbles....
"They achieve this using the same playbook over and over again. The formula is relatively simple: Goldman positions itself in the middle of a speculative bubble, selling investments they know are crap. Then they hoover up vast sums from the middle and lower floors of society with the aid of a crippled and corrupt state that allows it to rewrite the rules in exchange for the relative pennies the bank throws at political patronage. Finally, when it all goes bust, leaving millions of ordinary citizens broke and starving, they begin the entire process over again, riding in to rescue us all by lending us back our own money at interest, selling themselves as men above greed, just a bunch of really smart guys keeping the wheels greased. They've been pulling this same stunt over and over since the 1920s — and now they're preparing to do it again, creating what may be the biggest and most audacious bubble yet."
The truth is that in this latest economic collapse there were millions of losers and just a few winners.
Goldman Sachs was one of those winners.
So will they lose next time?
In their recent article, Vanity Fair quoted an anonymous source in the financial industry as saying the following....
"Are they the Yankees? No, the Yankees actually lose! Goldman never loses."