Posts Tagged ‘FIRE Sector’

Schemes of the Rich and Greedy

Courtesy of Michael Hudson

Tax-Avoidance – The Worst is Yet to Come

“Let me tell you about the very rich. They are different from you and me.”
“The Rich Boy,” by F. Scott Fitzgerald

The 30-year campaign of the wealthy to rig our economic system – especially the tax component – for their own benefit will accelerate with the GOP capture of the House of Representatives and the likely capture of the presidency and Senate in two years. For a foreshadowing of what is to come, a dress rehearsal has been conducted in Latvia, Iceland, Ireland and other financially strapped countries. Latvia has been burdened with the world’s most regressive tax system, while Iceland and Ireland have become record setters in tapping taxpayers to bail out financial crime syndicates, a.k.a. banks. 

The Irish bailout will encumber its people with perhaps as much debt as a $9 trillion bailout would be here in the United States. The Irish also are expected to also gut unemployment insurance, their minimum wage and similar social safety nets while boosting interest rates and home property taxes to pay tribute to the European creditor agencies that have “rescued” them. They will relinquish ownership of much of Ireland to their creditors, capped by ownership of government policy-making. The new banks will be owned by foreigners, who will put Ireland on a debt treadmill to transfer its taxable surplus to mainland Europe and Britain. 

Just as the U.S. taxpayer saved Goldman Sachs and the other high rollers from taking a loss, the Irish are being forced to “socialize” (that is, oligarchize) the losses of the banks. Think of how the Federal Reserve gave the banks 100 cents on the dollar for the some $2 trillion of toxic assets they took off the books of the banks and you get a sense of how the Irish bailout money will be used. It will keep the banks and creditors whole. 

Bad banking is going unpunished.  Shareholders, bondholders, large depositors and bank executives are not facing constraints on moral hazard. The European Central Bank (ECB) has cleaned up their mess, enabling and their wealth to grow on its trajectory as before – at the price of impoverishing the non-financial parts of society. Every effort will be made to re-inflate the property bubble putting off the day of reckoning. Taxes – like accountability – are for what Leona Helmsley referred…
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How Brazil Can Defend Against Financialization

How Brazil Can Defend Against Financialization

and Keep Its Economic Surplus for Itself

restorer works in the undergrounds of the Colosseum in Rome, Italy on June 2010. Rome's Colosseum, soon to open its arena, underground and highest level after extensive restoration. For the first time tourists will be able to visit the underground, where gladiators once prepared for fights and lions and tigers were caged before entertaining a bloodthirsty public. Restorers have been hard at work cleaning and restoring travertine columns and ancient bricks. Rome's Colosseum, the largest ever built in the Roman Empire was completed in 80 AD with a capacity of up to 75,000 spectators. It was mainly used as a venue for gladiatorial contests and public spectacles. Photo by Eric Vandeville/ABACAPRESS.COM Photo via Newscom

Courtesy of Michael Hudson

CDES Conference, Brasilia, September 17, 2010

I would like to place this seminar’s topic, ‘Global Governance,’in the context of global control, which is what ‘governance’ is mainly about. The word (from Latin gubernari, cognate to the Greek root kyber) means ‘steering’. The question is, toward what goal is the world economy steering?

That obviously depends on who is doing the steering. It almost always has been the most powerful nations that organize the world in ways that transfer income and property to themselves. From the Roman Empire through modern Europe such transfers took mainly the form of military seizure and tribute. The Norman conquerors endowed themselves as a landed aristocracy extracting rent from the populace, as did the Nordic conquerors of France and other countries. Europe later took resources by colonial conquest, increasingly via local client oligarchies.

The post-1945 mode of global integration has outlived its early promise. It has become exploitative rather than supportive of capital investment, public infrastructure and living standards.

In the sphere of trade, countries need to rebuild their self-sufficiency in food grains and other basic needs. In the financial sphere, the ability of banks to create credit (loans) at almost no cost on their computer keyboards has led North America and Europe to become debt ridden, and now seeks to move into Brazil and other BRIC countries by financing buyouts or lending against their natural resources, real estate, basic infrastructure and industry. Speculators, arbitrageurs and financial institutions using “free money” see these economies as easy pickings. But by obliging countries to defend themselves financially, their predatory credit creation is ending the era of free capital movements.

Does Brazil really need inflows of foreign credit for domestic spending when it can create this at home? Foreign lending ends up in its central bank, which invests its reserves in US Treasury and Euro bonds that yield low returns and whose international value is likely to decline against the BRIC currencies. So accepting credit and buyout “capital inflows” from the North provides a “free lunch” for key-currency issuers of dollars and Euros, but does not help local economies much.

The natural history of debt and financialization

Today, financial maneuvering and debt leverage play the role that military conquest did in times past. Its aim is still…
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Culture of Deceit: Why Dick Fuld So Needlessly and Recklessly Perjured Himself Before Congress

Culture of Deceit: Why Dick Fuld So Needlessly and Recklessly Perjured Himself Before Congress

Courtesy of JESSE’S CAFÉ AMÉRICAIN

"Truth is not only violated by falsehood; it may be equally outraged by silence." 
Henri-Frederic Amiel

Yet another whistle blower who had been completely ignored by the SEC just stepped forward.

A Bloomberg analyst reported around noon NY time that they had verified Mr. Budde’s story, and that indeed Dick Fuld easily had received cash in excess of $500 million in compensation for the period in question, higher than even Henry Waxman had asserted in his charts during Dick Fuld’s testimony.

Mr. Budde, a former counsel who was frustrated and plain fed up with the culture of personal greed and deceit among the Lehman executives stepped forward again to tell his story after being completely ignored by the SEC and the Lehman Board of Directors.

Now, I have some sympathy for Dick Fuld. I mean, when you are making the big bucks owed to a master of the universe, and you eat widows and orphans for breakfast, what does it really matter if it is $300 million, or $550 million, or even the one billion that some estimate was the true total compensation? What is a few hundred millions when you wipe your behind with Cohiba cigars, and gargle with Cristal Brut 1990?(Oh yeah, that’s class, real class. I must finally be somebody, and not just some schmuck from the Bronx. I’ll show them, show them all.)

I know I have trouble keeping track of what I have exactly in my own wallet at times, especially after paying the kids a couple of quid to walk the dog. And $200 million is hardly a significant sum anymore in the rapidly expanding compensation universe change on Wall Street. There is the locus of Bernanke’s inflation, the FIRE sector, where the liquidity has been channeled, for years.

But what interests me most is why did Dick Fuld perjure himself over something so obviously verifiable, and largely irrelevant? Doesn’t he file tax returns? Did he mess up using Turbo Tax like other board members of the NY Fed are said to have done? Or was he just a little bit ashamed of taking huge sums from a company that he ran into the ground in a Ponzi scheme? On the other hand Goldman execs…
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LET THEM EAT CAKE

This is a terrific article on health care reform by Ellen, who also wrote the books Nature’s Pharmacy and The Key to Ultimate Health . Another excellent article on the subject by Charles Hugh Smith is "Why "Healthcare Reform" Is Not Reform, Part I" (here). – Ilene

LET THEM EAT CAKE:
THE ANOMALY OF COMPULSORY PRIVATE HEALTH INSURANCE

Let them eat cake,” the notoriously callous words ascribed to Marie Antoinette, were probably said a century earlier by Marie-Thérèse, the wife of Louis XIV. But whoever said them, the mindset the statement conveys of an aristocracy oblivious to the realities confronting the poor is still with us today. 

“Congressmen, what shall we do about the 30 million Americans lacking health insurance?”

“Why, that is simple. Force them to buy it. Fine them heavily if they don’t!”

“What if they don’t have the money?”

“Then take it from those who do!”

The health reform bills now coming through Congress are not focused on how to make health care cheaper or more effective, how to eliminate waste and fraud, or how to cut out expensive middlemen. As originally envisioned, the public option would have pursued those goals. But the public option has been dropped from the Senate bill and radically watered down in the House bill. Rather than focusing on making health care affordable, the bills focus on how to force people either to buy health insurance if they don’t have it, or to pay more for it if they do. If you don’t have insurance and don’t purchase it, you will be subject to a hefty fine. And if you do purchase it, premiums, co-pays, co-insurance payments and deductibles are liable to keep health care cripplingly expensive. Most of the people who don’t have health care can’t afford to pay the deductibles, so they will never use the plans they are forced to buy or be fined.  

To subsidize those who can’t pay, the Senate bill would make families earning two to four times the poverty level who don’t have employer-sponsored insurance surrender 8% to 12% of their income to insurance payments, or pay a fine. In another effort to make the insurance payments “affordable,” the Senate bill calls for the lowest cost plan to cover only sixty percent of…
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Phil's Favorites

New DIY contact tracing app expands the fight against COVID-19, using the science of memory

 

New DIY contact tracing app expands the fight against COVID-19, using the science of memory

This app is different. Designed by psychologists, the free and anonymous web-based app can help you remember who you came in contact with. Ani Ka via Getty Images

Courtesy of Jacqueline R. Evans, Florida International University; Christian Meissner, Iowa State University; ...



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Biotech/COVID-19

New DIY contact tracing app expands the fight against COVID-19, using the science of memory

 

New DIY contact tracing app expands the fight against COVID-19, using the science of memory

This app is different. Designed by psychologists, the free and anonymous web-based app can help you remember who you came in contact with. Ani Ka via Getty Images

Courtesy of Jacqueline R. Evans, Florida International University; Christian Meissner, Iowa State University; ...



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Zero Hedge

Restaurants Slashed Jobs Last Month

Courtesy of ZeroHedge

By Jonathan Maze of Restaurant Business

The restaurant industry lost 17,400 jobs in November, according to new data from the U.S. Department of Labor released on Friday.

It was the first monthly decline in the number of restaurant workers since April, suggesting that a renewed virus and state shutdowns of dine-in service are taking their toll.

The data is likely to increase pressure on Congress and the president to approve a new stimulus package, one that includes specific aid to independent restaurants that have been devastated by the pandemic.

The industry had been adding jobs at a rapid clip since May, as restaurants reopened dining rooms and expanded while consumers grew more comfortable with dining out. But it remains far below its pre-pande...



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ValueWalk

Larry Kudlow Weighs In On The November Jobs Report

By Jacob Wolinsky. Originally published at ValueWalk.

First on CNBC: CNBC Transcript: National Economic Council Director Larry Kudlow Speaks with CNBC’s “Squawk on the Street” today on the November jobs report.

Q3 2020 hedge fund letters, conferences and more

White House Economic Advisor Larry Kudlow Weighs In On The November Jobs Report

CARL QUINTANILLA: The director of the National Economic Council will talk about the November jobs’ number this morning. Larry, good morning. Happy Friday, good to have you back.

LARRY KUDLOW: Thank you. Hello folks, how are...



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Kimble Charting Solutions

Is The US Dollar About To Reach A Melting Point?

Courtesy of Chris Kimble

It’s been 20 years since the last major peak in the US Dollar. Could the greenback’s latest turn lower confirm another peak?

Today’s chart takes a macro view of the US Dollar Index and highlights the long-term down-trend at each point (1). As you can see, the buck is on a topsy turvy ride, bouncing up and down within this down-trend.

The latest bottom formed after the financial crisis and has seen the US Dollar trade within a 9 year up-trend channel marked by each (2). This gave bulls some confidence that the US Dollar may have formed a long-term bottomȂ...



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Politics

Ignoring Warnings His Election Lies Could Get People Killed, Trump Posts 46-Minute Rant Full of 'Unhinged' Falsehoods

 

Ignoring Warnings His Election Lies Could Get People Killed, Trump Posts 46-Minute Rant Full of 'Unhinged' Falsehoods

"Georgia elections director yesterday: Trump's rhetoric is going to get people killed. Trump today: here's 46 minutes of unhinged conspiracy theories."

Courtesy of Jake Johnson, Common Dreams

Activists march through the city of Detroit on November 7, 2020 to denounce President Donald Trump's false claims of voter fraud. (Photo: Adam J. Dewey/NurPhoto via Getty Images)

Just days...



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Chart School

Gold Chart Review

Courtesy of Read the Ticker

Gold swing trade is due, lets review some charts to see if it is a viable move.

The seasonal period of gold is now upon us, gold should advance for the next 3 months.

Gold Gann Angle Chart ...



Gold Channel Chart .. close up!



 

Gold Channel Chart
 


Changes in the world is the source of all market moves, to catch and ride the change we believe a combination of Gann Ang...



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Digital Currencies

Five Reasons Why Bitcoin is Going Up

 

Five Reasons Why Bitcoin is Going Up

Courtesy of 

Call it the “Respectability Rally”…

A few reasons for Bitcoin’s return to the record highs. It’s about $18,500 as of this writing, matching the previous highs from 2017’s original explosion.

Reason one: It’s going up because it’s going up. Don’t scoff, this is the reason most things in the markets happen and then the explanations are called for afterwards. I’m in financial television, I have literally watched this process occur in real-time. The more something moves in a given direction, the more peop...



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Mapping The Market

COVID-19 Forces More Than Half of Asset Management Firms to Accelerate Adoption of Digital Marketing Technology

By Jacob Wolinsky. Originally published at ValueWalk.

There is no doubt that the use of technology to support client engagement initiatives brings both opportunities and threats but this has been brought into sharp focus this year with the COVID-19 pandemic.

The crisis has brought to the fore the need for firms to enable flexibility in client engagement – the expectation that providers will communicate to clients on their terms, at their speed and frequency and on their preferred channels, is now a given. This is even more critical when clients are experiencing unparalleled anxiety from both market conditions and their own personal circumstances.

...

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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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