You are hereWall Street
What: End the Fed Rally
When: Sunday, November 22, 2009, 1-4 PM
Where: Charlotte Branch of the Federal Reserve Bank, 530 E Trade St Charlotte, NC 28202
How to Raise $140 Billion a Year From Wall Street Banks
By Dean Baker | Counter Punch
The deficit hawk crew, famous for missing the $8 trillion housing bubble that wrecked the economy, is now on the warpath pressing the case for a big new national sales tax. They claim that the country badly needs additional revenue to address projected budget shortfalls.
While we may need additional revenue at some point, it makes far more sense to impose a financial transactions tax (FTT), which would primarily hit the Wall Street banks that gave us this disaster, than to tax the consumption of ordinary working families. We can raise large amounts of money by taxing the speculation of the Wall Street high-flyers while barely affecting the sort of financial dealings that most of us do in our daily lives.
The logic of an FTT is simple. It would impose a modest fee on trades of stocks, futures, credit default swaps, and other financial instruments. The United Kingdom currently puts a 0.25 percent tax on the sale or purchase of shares of stock. This has very little impact on people who buy stock with the intent of holding it for a long period of time.
For example, if someone buys $10,000 of stock, they will pay $25 in tax at the time of purchase. If they sell the stock ten years later for $20,000 then they will have to pay $50 in tax. The total tax would be equivalent to an increase of 0.8 percentage points in the capital gains tax. Read more.
Here’s a shocker: Bernie Sanders of Vermont, the only self-described socialist in the Senate, has put forth the most capitalistic proposal yet for banking reform. The senator’s Too Big to Fail, Too Big to Exist Act proposes that if a firm is so big that its failure would threaten the economy or financial system, it should be broken up, not protected by the promise of a bailout.
That sounds simple and logical, yet none of the competing proposals floating around Capitol Hill — those from the White House or the House Financial Services Committee, or others expected this week from Christopher Dodd, the Senate Banking Committee chairman — have been so explicit in calling for an end to government rescues for private companies.
Of course, Senator Sanders’s bill is intended to be provocative. In two pages it outlines sweeping powers for the Treasury secretary to identify banks, hedge funds and insurers that are too big to fail. Read more.
Sign the Petition to Treasury Secretary Timothy Geithner. Here's part of the text:
Too Big to Fail is Too Big to Exist
Financial institutions that are “too big to fail” played a major role in undermining the American economy and driving our country into a severe recession.
Financial institutions that are “too big to fail” put taxpayers on the hook for a $700 billion bailout and more than $2 trillion from the Federal Reserve in virtually zero interest loans.
Huge financial institutions have become so big that the four largest banks in America (JP Morgan Chase, Bank of America, Wells Fargo, and Citigroup) now issue one out of every two mortgages; two out of three credit cards; and hold $4 out of every $10 in bank deposits in the country.
Just five banks in America (JP Morgan Chase, Bank of America, Citigroup, Goldman Sachs, and Morgan Stanley) own a staggering 95% of the $290 trillion in derivatives held at commercial banks. Derivatives are risky side bets made by Wall Street gamblers that led to the $182 billion bailout of AIG, the $29 billion bailout that allowed JP Morgan Chase to acquire Bear Stearns, and the collapse of Lehman Brothers.
The concentration of ownership in the financial services industry has resulted in higher bank fees and interest rates that consumers are forced to pay for credit cards, mortgages and other financial products. Read more, sign the petition.
Read both pages of Sen. Sanders' proposed legislation.
By Dave Lindorff
With word being leaked out over the weekend that our Nobel Peace Prize President is close to announcing plans to escalate the US troop level in the Afghanistan War by 50%, we are about to have perhaps the ultimate of ironies—a president announcing a big step-up in American war-making on November 11, the day known around much of the Western world as Armistice Day.
While modern Americans might not know it, with all the boom and bombast and mindless flag-waving featured in the military parades popular in today’s warrior culture, November 11 was originally established by Congress back in 1919, a year after the day the guns of World War I finally went silent over the blood-drenched fields of Europe in what was once, in a naïve spasm of optimism, referred to as the War to End All Wars. In declaring the national holiday Armistice Day, Congress said it was to be “a day dedicated to the cause of world peace.”
By Dave Lindorff
Ordinary, average, struggling Americans might be scratching their heads over the news today, as the Labor Department reports that unemployment is up by four-tenths of a percent for the month to a record 10.2%, fully three-tenths of a percent higher than economists had been forecasting, and stocks do what? Rise by a quarter of a percent!
What’s going on here?
Well, the tube analysts are quick to say, unemployment figures are a “lagging” indicator. That is, employment generally lags the overall economy, with layoffs coming after a recession kicks in, and hiring waiting until a recovery is well underway.
The British government announced Tuesday that it will break up parts of major financial institutions bailed out by taxpayers, highlighting a growing divide across the Atlantic over how to deal with the massive banks that were partially nationalized during the height of the financial crisis.
The British government -- spurred on by European regulators -- is forcing the Royal Bank of Scotland, Lloyds Banking Group and Northern Rock to sell off parts of their operations. The Europeans are calling for more and smaller banks to increase competition and eliminate the threat posed by banks so large that they must be rescued by taxpayers, no matter how they conducted their business, in order to avoid damaging the global financial system.
The move to downsize some of Britain's largest banks comes as U.S. politicians are debating whether American banks should also be required to shrink. Read more.
America the Betrayed
By Richard Cook
...Whitman a hero to the Beatniks of the 1950s who tried to rediscover an authentic American voice in the streets and on the roads and highways of this great land. The spirit of Whitman was surely present through the rebellion of the 1960s, when America’s young men and women rose up and fought the Establishment to stop the Vietnam War and bring civil rights to racial minorities.
The Establishment fought back with a vengeance and, through the most egregious betrayal in history, reduced the world’s greatest industrial democracy to the pathetic shadow of its former self we are today.
The first thing the Establishment did was destroy the industrial job base by shipping millions of good jobs to China and other Third World nations, where slave laborers could be forced to churn out consumer products at a fraction of the cost of similar work done by American workers. Read more.
By Dave Lindorff
It would be easy to read too much into the few statewide races that were decided last night, but I think it’s fair to say that the results in New Jersey and Virginia, where Republican gubernatorial candidates won--in New Jersey’s case knocking off a well-funded Democratic incumbent--that the results were a blow to the Barack Obama/Rahm Emanuel strategy of playing to the right, of avoiding confrontation in Congress and of ignoring the progressive voters whose enthusiasm and effort back in the 2008 campaign put Obama in office.
By Dave Lindorff
If you listen to the happy-talk folks at Treasury and the Fed, and on the tube, you’d think things had finally turned a corner. The economy grew at a 3.5% annualized rate in the third quarter ended September 30. “The Economy is Back in Gear” shouted the headline on an article by CNN senior writer Chris Isadore. “The recession ended unofficially in September,” said a reporter on NPR.
Not Too Big to Jail - Protest in Chicago
Last week, we got a slew of submissions to our "Foundation for Reform" paper! Consensus starts to crack. We just need to keep building the momentum.
So, have you heard about what promises to be the largest protests against the banks yet - Showdown in Chicago on October 25th? All ANWF members who want to go and need more details should contact us. As much as we can, we need to show up! We expect thousands of people to show, we hope you will too. The protest is being organized by dozens of organizations, including ANWF, and will take place outside of the American Bankers Association's annual meeting. You can help at this critical moment, find rides, organize a contingent and go. We'll help you meet up with other ANWF members. We'll have even more info for you next week, but the time to make a decision about going is now.
Our friends at the Center for Media and Democracy recently started working on bank reform too with a new go-to site for updates on the fight: www.BanksterUSA.org. Their "Action Center" is a hotbed of popular campaigning on the crisis, helping us to ramp up the campaign to demand the Federal Reserve fix what's broken (see the ANWF petition):
Fight the Big Boys on Wall Street at www.BanksterUSA.org.
"Fight the Big Boys on Wall Street at www.BanksterUSA.org
The Banksters have pulled off the biggest heist of all time. They have crashed the global economy, throwing 7.5 million Americans out of work, emptying retirement and college funds and forcing many into hardship and homelessness. Yet they continue to be rewarded with trillions of taxpayer dollars that underwrite their Bankster bonuses, they prey upon the vulnerable with ballooning bank fees and macabre investment schemes such as "death bonds" and their taxpayer-subsidized lobbyists swarm Capitol Hill to prevent the passage of any meaningful reform of the financial system.
The Smackdown Starts Now
This fall is a critical time. Congress is now taking up a series of bills to restore confidence in the financial sector. If you want to rein in the Banksters and if you think America deserves better than a "boom and bail" economy, you need to muscle up and weigh in. Only you can tell Congress to prioritize the interests of Main Street over the interests of Wall Street.
Bust the Banksters at BanksterUSA
www.BanksterUSA.org is the go-to site for updates on the financial services re-regulation fights in Congress and for progressive netroots campaigning against the big boys on Wall Street.
Our "Action Center" is a hotbed of popular campaigning on the crisis.
We know that it is wrong that a full year since the Wall Street meltdown no employee of any major American bank or blue chip financial institution is behind bars. Compare this to the Savings and Loan crisis 20 years ago. No less than 1,852 S&L officials were prosecuted and 1,072 were jailed.
Our motto? Too big to fail, but not too big for jail! Click here to email the U.S. Department of Justice and the FBI and tell them to get cracking!
Administration Refutes Geithner and Summers' Approval of BofA-Merrill Merger
Internal Bank Documents Show Obama Aides Were 'On Board'
By Matthew Jaffe | ABC News
"The Bank of America-Merrill Lynch merger was the outcome of a collaborative effort orchestrated by Ken Lewis, Henry Paulson, Ben Bernanke, Timothy Geithner, and Larry Summers," Bardella said in a statement. "As a result of this collaboration, the taxpayers ended up footing the bill so Bank of America didn't have to absorb Merrill's losses." ...
In January, when the Obama administration took over, Summers became National Economic Council director and Geithner replaced Henry Paulson as Treasury secretary.
During last year's transition period between presidential regimes, Obama economic aides Timothy Geithner and Larry Summers signed off on the Bush administration's deal to bail out Bank of America if it finalized its merger with ailing investment bank Merrill Lynch, according to bank documents obtained Tuesday by ABC News.
However, both the White House and Treasury today disputed that Summers and Geithner ever agreed to any financial decisions made during this time period.
"Mr. Summers received occasional briefings by Federal Reserve officials during the transition, but he did not make, review, or approve decisions regarding financial institutions during that time," White House spokesman Matthew Vogel said in a statement. Read more.
$140 billion! Record Payday for Wall Street
Goldman Sachs 2009 Bonuses Could Buy Insurance for 1.7 Million Families
50 Million Americans Live in Poverty
By David DeGraw | Amped Status
The facts are that $30,000 per person is unaccounted for - that’s $30,000 for every man, woman and child in the US - which means if you have a family of five, your family has lost $150,000 to Goldman Sachs.
Paraphrasing a very insightful quote: ‘The amount of poverty and suffering required for the emergence of a Goldman Sachs, and the amount of depravity that the accumulation of a fortune of such a magnitude entails is left out of the mainstream media, and it is not always possible to make the people in general see this.’
The American middle class, once the only effective counter weight to Wall Street greed, has been decimated. Over 25 million people, in what was the US middle class, are now in full-blown crisis mode and urgently need to increase their income. Read more.
On October 17, 2009 on the 8th anniversary of the attack on Afghanistan Bay area trade unionists spoke out against the continuing US war in Afghanistan and wars in Iraq and around the world. Trade unionists included Betty Olson-Jones, president of Oakland Education Association and Jack Heyman, Executive Board ILWU Local 10.
Produced By: Labor Video Project
P.O. Box 720027
San Francisco, CA 94172
How the Servant Became a Predator: Finance's Five Fatal Flaws
By William K. Black | Huffington Post
What exactly is the function of the financial sector in our society? Simply this: Its sole function is supplying capital efficiently to aid the real economy. The financial sector is a tool to help those that make real tools, not an end in itself. But five fatal flaws in the financial sector's current structure have created a monster that drains the real economy, promotes fraud and corruption, threatens democracy, and causes recurrent, intensifying crises.
1. The financial sector harms the real economy.
2. The financial sector produces recurrent, intensifying economic crises here and abroad.
3. The financial sector's predation is so extraordinary that it now drives the upper one percent of our nation's income distribution and has driven much of the increase in our grotesque income inequality.
4. The financial sector's predation and its leading role in committing and aiding and abetting accounting control fraud combine to:...
5. The CEOs of the largest financial firms are so powerful that they pose a critical risk to the financial sector, the real economy, and our democracy. Read more.
Reviewing Danny Schechter's The Crime of Our Time
By Stephen Lendman
Danny Schechter is a media activist, critic, independent filmmaker, and TV producer as well as an author of 10 books and lecturer on media issues. Some call him "The News Dissector," and that's the name of his popular blog on media issues. He's also the co-founder of Media Channel.org that covers the "political, cultural and social impacts of the media," and provides information unavailable in the mainstream.
Schechter's books include The More You Watch The Less You Know, Plunder: Investigating Our Economic Calamity and the Subprime Scandal, and his newest and subject of this review, The Crime of Our Time: Was the Economic Collapse "Indeed, Criminal?"
As a form of economic terrorism, indeed so says Schechter and many others. Ellen Brown, author of Web of Debt, writes: Schechter "establishes the crime's elements, identifies the players, and exposes the weapons that have turned free markets into vehicles for mass manipulation and control."
More still, according to former high-level government and Wall Street insider Catherine Austin Fitts in describing a "financial coup d'etat" that includes inflating multiple market bubbles, pump and dump schemes, naked short selling, precious metals price suppression, and active market intervention by Washington and the Fed that lets powerful insiders game the system, commit massive fraud, and be able to transfer trillions of public wealth to themselves, then get open-ended bailouts when the inevitable crisis surfaces.
In his last book, Plunder, Schechter deconstructed one element of the economy's financialization - the outlandish amounts subprime lending, instrumental in inflating the housing bubble and the economic crisis that followed.
The Crime of Our Time is his latest attempt to explain "the financial collapse as a crime story (and) the high status white-collar crooks" who wreak havoc on "the lives of hundreds of millions worldwide." He quotes from author and labor activist Jonathan Tasini in his new book, The Audacity of Greed, saying:
"Over the past quarter century, we have lived through the greatest looting of wealth in human history." While an elite few profited hugely, "the vast majority of citizens have lived through a period of falling wages, disappearing pensions, and dwindling bank accounts, all of which led to the personal debt crisis that lies at the root of the current financial meltdown."
The fallout cost millions of Americans their jobs, homes, savings, and futures, the result of a Washington - Wall Street criminal cabal and their scandalous conspiracy against the US public. In the Crime of Our Time, Schechter, once again, does a superb job explaining it astutely, thoroughly, and clearly.
Capitalism: An Apathy Story
By Cindy Sheehan
This Thursday, in a move that would make Baron von Louis Rothschild blush with shame (or burst with pride), Goldman Sachs will announce that it is more than doubling its bonus pool: from 11 billion in 2007 to 23 billion in 2008.
I always thought the concept of the “Welfare Queen” was eliminated during the Clinton Regime (where his SecTreas was a former chair of G S) however, Goldman Sachs has received billions of dollars in taxpayer welfare and supposedly paid that back, except for the 13 billion that was funneled through AIG to Goldman through loan guarantees.
Well, wouldn’t it be hunky dory if every loan we consumers took out from these banksters came with a guarantee that if we failed, our government would pay our loans off?
“Compensation continues to generate controversy and anger,” Lloyd Blankfein, the chief executive of Goldman Sachs, said last month. “And, in many respects, much of it is understandable and appropriate.”
On Thursday, Mr. Blankfein and his colleagues will likely be subject to some of that anger when Goldman reports its third-quarter results — and discloses the latest tally of just how much its employees will probably take home for their work this year. By most analyst estimates, the annual bonus pool will swell to more than $23 billion. In its second quarter, Goldman disclosed it had put aside $11.4 billion for the first half of the year.
“The absolute size of compensation payouts will rise significantly,” Keith Horowitz, an analyst at Citigroup, wrote in a note to clients two weeks ago.
To put that $23 billion bonus pool number in perspective, it is the most Goldman Sachs has accumulated for bonuses in its history — twice as much as in 2008. And it is doing so while memories are still fresh that just a year ago taxpayers had to step in when Wall Street, and even Goldman, were facing a run on the bank.
So should we be upset about the bonuses? Is this a problem? Viscerally, it can be infuriating to watch Goldman executives gobble up piles of money, especially when the government — an overused euphemism for taxpayers — had helped support the firm. It hasn’t been forgotten that the government gave Goldman $10 billion in bailout cash — which it has since returned and said it never needed. And don’t forget the cheap financing it now gets as a bank holding company. Read more.
The health care debate and general political climate compound absurdity upon absurdity.
First we're told that our health care is only worth the time and effort if the remedy has no negative impact on the budget. No deficits allowed. The deficit risk defines your chances for health and longevity.
At the same time, we see that Wall Street failures and the overseas war effort are not held to the same standard on deficits spending.
The federal government has committed $23 trillion dollars to prop up Wall Street's failed financial institutions. That's a fantasy figure and clearly deficit-friendly since it's twice the 2008 Gross Domestic Product of the United States.
On Tuesday of this week a smaller amount was offered up for the 2010 expenditures on the Iraq war and the expanded efforts in Afghanistan. The $128 billion was approved without a Congressional Budget Office analysis (note the absence of a link for "CBO Cost Estimates"). Since we're already over budget for 2010, this is also in the deficit column.
It's all right to run huge deficits to bailout Wall Street crooks and to wage deadly wars but it's not all right to even think about a deficit when it comes to preserving the health and lives of citizens.
The second absurdity concerns priorities. A rational approach to national policy would place citizen health care well above both Wall Street welfare and endless wars on any list of priorities. But that wouldn't do much good with the current legislative approach.
A political victory amounts to a loss for the public. Why?
The current legislation delays help for the uninsured for years. It limits the "public option" to those without health insurance. It does little or nothing to contain rising health care costs for in the near term. And it ignores prescription medication -- a major factor in out-of-control costs. Read more.
“All they need to do is enforce the regulations already on the books,” one top banker told me recently. (Like all top bankers these days, he would speak only anonymously, fearing the wrath of the Treasury.)
What’s more — and this is the part that is really unbelievable — they insist that bankers weren’t the cause of the financial crisis. The entities that were peddling all those awful subprime mortgages were the nonbanks — the mortgage originators and mortgage brokers — who were almost entirely unregulated. “We have no objection to them regulating the nonregulated firms,” said Camden R. Fine, the president of the Independent Community Bankers of America.
Well, of course, he doesn’t. If the bankers can persuade Congress to change this agency’s mission so that it only regulates the nonbanks — something they are trying to do, and which Mr. Frank insists will not be successful — they will have succeeded in putting sand in the engine of their nonbank competitors.
A few months ago, I asked Simon Johnson, the former International Monetary Fund economist, now a prominent critic of the banking industry, what he thought the banks owed the country after all the government bailouts.
“They can’t pay what they owe!” he began angrily. Then he paused, collected his thoughts and started over: “Tim Geithner saved them on terms extremely favorable to the banks. They should support all of his proposed reforms.”
Mr. Johnson continued, “What gets me is that the banks have continued to oppose consumer protection. How can they be opposed to consumer protection as defined by a man who is the most favorable Treasury secretary they have had in a generation? If he has decided that this is what they need, what moral right do they have to oppose it? It is unconscionable.”
I couldn’t have said it better myself. Read more.
by Linda Milazzo
Our great buddy Mike is angry. For the past twenty years, Michael Moore, our everyday hero, has worked hard for us. He's documented sadistic acts against us by industry and government. He's exposed case after case of devious schemes that robbed us of our homes and our jobs, sent our children to war, and sacrificed our health. He's given us irrefutable proof that our leaders lied us to war, our insurers denied us care, and our lenders deceived us into hopelessness and destitution.
Mike's been our teacher, our ally and our devoted friend. Few people in recent memory have worked harder to inform us - ALL OF US - of the inhumanity and greed that are decaying our nation, which we perpetuate through apathy and inertia.
"If you are the average Joe, you should definitely be worried because if the U.S. dollar loses its status it is going to mean higher borrowing costs for the U.S. government, which will mean the average Joe will have to pay higher taxes, the U.S. government will spend less on services, and there will be higher interest rates -- or some combination of the above."
Is the dollar's status as the world's reserve currency in jeopardy? How are U.S. officials responding? And should the average American be worried?
A report in The Independent newspaper today, citing Gulf Arab and Chinese banking sources in Hong Kong, said that Gulf Arab countries -- joined by China, Russia, Japan and France -- are planning to move away from pricing oil in dollars to using an array of currencies including the Japanese yen, the Chinese yuan, the euro, gold, and a new unified currency in the Gulf Co-operation Council including Saudi Arabia, Abu Dhabi, Kuwait, and Qatar. Read more.
The Senate last night passed an amendment by Sen. Bernie Sanders (I-Vt.) that would require the Department of Defense to calculate how much the Pentagon pays companies that committed fraud.
The measure, added to a defense appropriations bill, also would make the Pentagon recommend how to penalize contractors that repeatedly cheated the government out of hundreds of millions of dollars....According to the nonpartisan Project on Government Oversight, the three largest government contractors – Lockheed Martin, Boeing, and Northrop Grumman – all have a history riddled with fraud and other illegal behavior. Altogether, the three companies engaged in 109 instances of misconduct since 1995, and were fined $2.9 billion. How were they punished? In one year alone, the big-three pocketed $77 billion in government contracts in 2007. Read more.
They Lied: Watchdog Says Treasury and Fed Knew Bailed-Out Banks Were Not 'Healthy'
Before the $700B Bailout, Senior Government Officials Had Financial Concerns About Nine Bank Institutions Receiving TARP Funds
By Matthew Jaffe | ABC News
The Treasury Department and the Federal Reserve lied to the American public last fall when they said that the first nine banks to receive government bailout funds were healthy, a government watchdog states in a new report released today.
Neil Barofsky, the special inspector general for the Troubled Asset Relief Program (SIGTARP), says that despite multiple statements on Oct. 14 of last year that these nine banks were healthy and only receiving government funds for the good of the country's economy, federal officials knew otherwise.
"Contemporaneous reports and officials' statements to SIGTARP during this audit indicate that there were concerns about the health of several of the nine institutions at that time and, as detailed in this report, that their overall selection was far more a result of the officials' belief in their importance to a system that was viewed as being vulnerable to collapse than concerns about their individual health and viability," Barofsky says. Read more.