Nomi Prins: Why the Financial and Political Systems Failed

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Posted on 28th October 2014 by Administrator in Economy |Politics |Social Issues

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Guest Post by Jesse
Nomi Prins calls out the policy error deluxe that has been the topic of so much commentary at Le Café over the past few years.
What is perhaps most striking is that this failure is so bipartisan in a time of contentiousness.   It crosses not only parties but professions, from academics to politicians.
As you know I have featured several articles and videos of hers as she introduces her latest book, All the President’s Bankers which is insightful, well-founded and researched, and essential to any understand of what is happening today.
As you know I have ascribed this to the credibility trap.   Insiders never speak ill of insiders, if they which to remain a part of the power elite. This is reinforced in the Ivy League and the halls of power.   And so leaders and potential leaders are hopelessly compromised and entangled in a self-serving system of abuse of power and corruption.
It is part of a general failure of moral conscience and leadership in the country.   It has been or is being repeated in England and other countries in Europe.  It is the reason for the long stagnation of the Japanese economy.
This is a very brief excerpt.  You may read this insightful commentary in its entirety here.
“The recent spike in global political-financial volatility that was temporarily soothed by ECB covered bond buying reveals another crack in the six-year-old throw-money-at-the-banks strategies of politicians and central bankers.
The premise of using banks as credit portals to transport public funds from the government to citizens is as inefficient as it is not happening. The power elite may exude belabored moans about slow growth and rising inequality in speeches and press releases, but they continue to find ways to provide liquidity, sustenance and comfort to financial institutions, not to populations.
The very fact – that without excessive artificial stimulation or the promise of it – more hell breaks loose – is one that government heads neither admit, nor appear to discuss. But the truth is that the global financial system has already failed. Big banks have been propped up, and their capital bases rejuvenated, by various means of external intervention, not their own business models…”

Chris Hedges: The Myth of a Free Press

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Posted on 27th October 2014 by Administrator in Economy |Politics |Social Issues

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Guest Post by Jesse

The bias in the US media towards corporate and special interests is apparent in some sources more easily and readily than in others, especially if one has access and bothers to look at a broad base of international news sources.The great change was institutionalized with the overturn of the Fairness Doctrine under Reagan in 1985 and the revoking of media ownership restrictions from 1934 and 1975 under the Clinton administration’s Telecommunications Act of 1996.

What has changed perhaps is the extreme marginalization of independent sources.  For the most part media outlets declare themselves for one group or another.  The bias of the financial media in policy issues has become so obvious and servile to its corporate interests that it is almost embarrassing.  What is even more surprising is the reach of this sort of continuous advocacy journalism into ‘mainstream’ channels such as Fox and MSNBC that actively re-interpret reality to suit a class of viewers.

This balkanization of the issues attracts large classes of listeners into group think, and precludes any meaningful debate of the issues, even to the very framing of the questions and the issues, and ultimately their very perception of reality.

This is a brief excerpt.   Read the entire article for free here.

“The mass media blindly support the ideology of corporate capitalism. They laud and promote the myth of American democracy—even as we are stripped of civil liberties and money replaces the vote. They pay deference to the leaders on Wall Street and in Washington, no matter how perfidious their crimes. They slavishly venerate the military and law enforcement in the name of patriotism.

They select the specialists and experts, almost always drawn from the centers of power, to interpret reality and explain policy. They usually rely on press releases, written by corporations, for their news. And they fill most of their news holes with celebrity gossip, lifestyle stories, sports and trivia. The role of the mass media is to entertain or to parrot official propaganda to the masses.

The corporations, which own the press, hire journalists willing to be courtiers to the elites, and they promote them as celebrities. These journalistic courtiers, who can earn millions of dollars, are invited into the inner circles of power. They are, as John Ralston Saul writes, hedonists of power…

The mass media are plagued by the same mediocrity, corporatism and careerism as the academy, labor unions, the arts, the Democratic Party and religious institutions. They cling to the self-serving mantra of impartiality and objectivity to justify their subservience to power.

The press writes and speaks—unlike academics that chatter among themselves in arcane jargon like medieval theologians—to be heard and understood by the public. And for this reason the press is more powerful and more closely controlled by the state.

It plays an essential role in the dissemination of official propaganda. But to effectively disseminate state propaganda the press must maintain the fiction of independence and integrity. It must hide its true intentions.”

Chris Hedges, The Myth of a Free Press

U.S. MIDDLE CLASS: THE REAL WALKING DEAD

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Posted on 25th October 2014 by Administrator in Economy |Politics |Social Issues

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Via Jesse

QUOTE OF THE DAY

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Posted on 25th October 2014 by Administrator in Economy |Politics |Social Issues

“The big changes always take longer than we expect. And once they start, they come much more quickly than we had imagined. So we must take the markets as they are. There is no sense to criticize a lifeboat for not being a motorcycle.Do we need lifeboats? Do you trust the central banks and the politicians to safeguard your wealth and the integrity of the money and the financial system? Only you can provide the answers for your own peace of mind.”

Jesse

The American Dream By Joe the Angry Hawaiian

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Posted on 20th October 2014 by Administrator in Economy |Politics |Social Issues

Via Jesse

This is from the Big Island.  The natives seem restless.

“Democracy in a free market capitalistic society today only exists in the imaginations of sleep-walkers in the American Dream. The idea of honest, hard work being suitably rewarded has become a mind-numbing slogan that is now just beginning to wear off in the minds of some Americans.

While Americans were working and playing hard, our representational democracy has evolved into a political system that has been completely and utterly bought by the moneyed interests, and is now a protection racket for their accumulation of wealth and advantageous positions of power and influence. We live in a land where untaxed off-shored wealth is ignored, and the whole tax system has been customized to suit their personal needs.

We live in a fictitious land where multi-national corporations are legally given Frankenstein-like status as a red-blooded American, and their money has become their vocal chords. Politicians, while posturing that they are working for the people, are nothing but lobbyists for the rich, which most of them are, or assured to be upon leaving office to be rewarded with speaking fees, or think tank positions by their powerful benefactors.

This unreal, and unjust dream-land is kept alive by obscuring smoke and brightly lit mirrors of the mass media that is completely controlled by a relatively few corporate interests. Combined with idealized statistics provided by the government we have been lulled into an illusion that is both numbing and dumbing. To realize there is even a problem, attention spans must be able to last for longer than a 60 second advertisement.

The hard rock reality of the great American experiment is being felt by most everyone with a wallet or purse. The financial system is run by the un-Federal Reserve Banks. The privately owned US Central Bank gives money which they make out of thin air to the boys who run the biggest Banks for less than .25%. As the statistics reveal, this money rarely goes far from the hands of the rich. Their fingers grasp this money so tightly that the so called trickle is now a mere tiny dribble that seeps slowly to those below.

The US dollar is a fiat money con-game sustained by the illusion of American exceptionalism. This confidence in America as a moral force for good has been destroyed by its self-serving hypocrisy, its torture, the poor performance of its political drama queens, and endless wars without end. But things are changing. No longer can the US declare an economic embargo that brings countries to their knees, especially since the US itself is up to it’s myopic third eye in debt.

I believe the problem that we will be facing soon enough is not the economic imbalance of the rich and poor in this country. This unequal lopsidedness can be maintained for many years, especially with a militarized police force.

The real problem is those beyond the reach of the system like Russia and China and the rest of the BRICS. When they decide that they have had enough of our self-serving antics, and renounce the US dollar as the world currency, then folks, that’s when we have a problem.

Until then nothing changes, since most members of our society can’t even remember there is problem or what caused it.

 

Domestic Democracy or Foreign Imperialism, But Not Both

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Posted on 18th October 2014 by Administrator in Economy |Politics |Social Issues

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Guest Post by Jesse

“Once you go down the path of empire, you inevitably start a process of overstretch, of tendencies toward bankruptcy, and, in the rest of the world, a tendency toward the uniting of people who are opposed to your imperialism simply on grounds that it’s yours, but maybe also on the grounds that you’re incompetent at it.
Indeed, one wonders whether we have already crossed our Rubicon, whether we can go back. I don’t know.
The Department of Defense is not, today, a department of defense. It’s an alternative seat of government on the south bank of the Potomac River. And, typical of militarism, it’s expanding into many, many other areas in our life that we have, in our traditional political philosophy, reserved for civilians. Domestic policing: they’re slowly expanding into that.
So, what do I suggest probably will happen? I think we will stagger along under a façade of constitutional government, as we are now, until we’re overcome by bankruptcy.”
Chalmers Johnson
That bankruptcy will not only be financial, but moral and spiritual.  It will be a fiat culture, that is, reality will be defined as whatever power says it will be.
Below is a talk given by Chalmers Johnson in April, 2007
This was before the financial crisis and bailouts.
And before the Reform President Obama largely ratified the abuses of his predecessor and given over the welfare of the people to the corporations and the moneyed interests, finance and militarism, the pen and the gun, the bullet and the bribe.

WALL STREET – NOT TOO LAZY TO STEAL

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Posted on 16th October 2014 by Administrator in Economy |Politics |Social Issues

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Guest Post by Jesse

Swiss National Bank Fights To Block Public Gold Vote

“Switzerland’s central bank is flexing its muscles to defend its cap on the Swiss franc. Its battle to fend off deflation – in which it sees the exchange rate as its chief weapon – is already complicated by the slide in the euro that followed European Central Bank easing.

Now the SNB is fighting on a new front: to block a populist motion that would force it to almost treble the proportion of reserves held in gold.”

Financial Times – Swiss National Bank Fights To Block the Public Gold Vote

Crushing populist notions seems to be quite fashionable amongst the better classes of the West. Unless of course those notions are taking place somewhere else that has fallen out of their favor. Then they are all for democracy don’t you know.

Sometimes I just don’t have the words.   To watch the proud Scots go down to fear-mongering by the financial establishment and their pampered princes is bad enough.  But to hear that this may also happen to the Swiss people whether or not they believe in the Banksters makes me sick at heart.

Gold and to a lesser extent silver caught a flight to safety bid today as US equities were in full meltdown mode this morning on bad economic news that accentuates that, despite all the facades and window dressing, there is no sustainable recovery.

I have to chuckle at the Fed choosing to end QE3 in October.   As I recall, that last two times the Fed ended QE the equity markets dropped about ten to fifteen percent.

And so we have the US equity markets, which had been pushed to an obvious artificial high for the year to date by the usual Banks trying to get the largest IPO ever out the door in September.

And the Fed sticks to their plan to end QE 3 in October, an infamously volatile month for stocks.  Why didn’t they just choose October 29 for the official end date, and call it the Black Wednesday Stock Declines Initiative?

Well there is still some short term hope for the stock markets because this is a stock option expiration and the algos are able to shove this pig around the plate when the panic subsides, as we have seen.  One thing you have to give Wall Street:  they are not too lazy to steal.

Fundamental analysis is passé, and we are operating in a fiat culture:  whatever power decrees must be true. And it is not likely that you will hear otherwise, except in conversations in the coffee houses and cafes.

Fat Lady Singing: The Alibaba IPO Top-Ticked the Market, Precisely

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Posted on 15th October 2014 by Administrator in Economy |Politics |Social Issues

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Guest Post by Jesse

“As flies to wanton boys are we to the gods. They kill us for their sport.”

William Shakespeare, King Lear

Wall Street puffed up the stock market indices to get the ‘largest ever’ IPO of Alibaba out the door.

Just in case you still had any illusions about these being ‘free markets,’ as if such a thing can even exist without the hard work of honest and objective referees.

After they took that piggy to market, the underwriters and the market manager (GS) let the markets go their own way.

Home again, home again, jiggety jog.