Iceland Shows The World

This would have been the perfect gift for the country to give to its people on the joy of the season……start putting the thieves that work at banks in prison…….wishful thinking I know but at least one country has done the right thing…….(read on)…..

There has been lots of mumbling and grumbling about what the bankers were allowed to get away with when they caused the economic meltdown of 2008……..they have made obscene bonuses and still walk among us even after about 50% of the population lost lots of their coveted nest egg that they were depending on for a comfortable retirement….the American Dream was crapped on by the banks and the thieves they employ……some Americans have called for these crooks to be jailed for they basically robbed the population of their funds….but so far they got bigger bonuses and are not help responsible for their actions…….what to do…..what to do?

The small island country of Iceland has shown the world what should be done to these cons……

(Newser) – Iceland has done something highly unusual with some of the bank chiefs blamed for the country’s 2008 financial collapse: put them on trial and sent them to prison. Four former Kaupthing Bank bosses have been sentenced to between three and five years for market abuses relating to a deal where a Qatari sheikh bought a confidence-boosting stake in the bank with money that had been provided by the bank itself, the BBC reports.

Prosecutors said the loans, made soon before Kaupthing collapsed under massive debts, were made solely to boost the bank’s share price, reports Reuters. The bank’s former chief executive and chairman of the board received prison terms, along with one of its majority owners and the chief of its Luxembourg branch. The sentences are the heaviest Iceland has ever handed down for financial fraud, but prosecutors say a bigger case against Kaupthing is in the works

And that my friends is how you hold con artists responsible for their actions……America should follow suit….but NO…we fine them and let them return to the actions they were doing that caused the economic collapse……where is the logic here?

Do You Know What happened In 2008?

Yes, I am talking about the crash and the ensuing recession, the unemployment, foreclosures and the tune continues…….you may know that your 401k is not worth the paper it is printed on…..but do you know just how the crash happened?

I am guessing that most Americans either do not know or maybe they just do not give a crap……but if you are truly interested in educating yourself on how you were screwed….then by all means read on…….if not then maybe a good episode of “Jersey Shore” that teaches a lot about life is on MTV….if you do not care enough to learn what happen then keep thy mouth shut when it blows up again….and make NO mistake ….IT WILL!

A very good explanation has been written by Zeus Yiamouyiannis……..

Here is how the counterfeit value derivative con works.  It’s a game of “I pretend, you pretend, we all pretend, and the taxpayer will pay in the end”.

1) I’ll create an instrument, say a credit default swap (CDS), an unregulated insurance with no capital requirements, with a certain “notional” value. Notional value is just something I assign. It does not have to be attached to or backed by any real asset or actual money/principal, but I can pretend as if it is. (Notional amount.)

2) As a seller, I will just declare that this swap covers the full value X of this company, contract, etc. if credit event Y happens. I receive lucrative insurance premiums and fees for my unbacked promise. The CDS’s value is based in nothing more than my promise to pay. I don’t have to have adequate capital reserves on hand, but I can pretend as if I do perhaps with some mini-reserves based on objective-seeming risk ratios calculated by my mathematical models. (credit default swap.)

3) As a buyer, you can then buy as many of these CDS’s as you want, even for a single default. If you are really sure something is going to tank you can insure it 30 times over (or a 100 or 1,000) and get 30 (or 100 or 1,000) times the return when it goes bust! In regulated insurance it is unacceptable to insure beyond the full replacement value of the underlying asset. Not so with CDS’s. The seller has gotten 30x the premiums and the buyer gets 30x value in the event of default. As a buyer of this phony “insurance” you don’t have a stake in the affected properties, but you can essentially pretend you do.

4) As buyer and seller of CDS’s either one of us can assign our risks to a third party through another contract, and pretend as if we are covered in case our own game playing blows up in our faces. This allows us to retain even less reserve capital and spend freed-up funds on more high-risk, high-(pseudo) return speculation. (The monster that ate Wall Street.)

5) We can purchase and sell of these derivative contracts to each other at unlimited rates to generate massive volume and huge fees and profits. We can simply hyper-cycle risk and take our chunk each time.

According to the Bank of International Settlements, as of June 2011 total over-the-counter derivatives contracts have an outstanding notional value of 707.57 trillion dollars, ( 32.4 trillion dollars in CDS’s alone). Where does this kind of money come from, and what does it refer to? We don’t really know, because over-the-counter derivatives are not transparent or regulated.

Read More…

The answer to your questions are not as difficult to understand as the msm and the economists want you to believe……..once you learn the facts then you can keep your bank and brokers in check….that is if you really give a crap……and Dodd-Frank is a blowjob….it does little to keep the financial sector from gaming the system again and causing another meltdown….personally, I want to see someone go to prison because of what has been done to the economy and beyond that I want to make sure these con men cannot either game the system again so that we, the taxpayer, give them an out…..let them ROT in their own deceitfulness!

On State Capitalism

College of Political Knowledge

My readers know that I spend an inordinate amount of time trying to explain and make complex theories more palatable to the average working stiff…..and I hope that I succeed in some small way so that we all can make more informed decisions in our political thinking……

State Capitalism?  Now there is a subject that would make a person’s eyes bleed or the head explode….we can either look at it as some secret code word for socialism (not necessarily so) or we could talk about the government programs…….it conjurers up some many images for people….but what is it really?  State capitalism, that is.  I am sure that most people already have a preconceived idea of what socialism is and that is the subject for yet another post….

State capitalism simply put is….the idea of combining state funded projects and state regulation of the market with private ownership and profit taking…..if you think about it it sounds a lot like what we have now only on a limited basis…..

Now with that under our belt….state capitalism can impose regulations on labor and generate a bunch of it, especially when capitalists are reluctant to invest  (sound familiar?)…….it can encompass private financial gain with an overview of the needs of the country as a whole….(still sounding familiar?)…..In really bad economic times…it can motivate and stimulate local investment when other markets look more inviting to the private investors…..(once again, familiar?)…..

Let’s be real……state capitalism can be a far more effective way of dealing with a bad recession or depression than traditional liberal capitalism……

And yes, we can associate state capitalism most often with some form of dictatorship….however in dire economic times it may just be the best way to fight a recession or a deep depression….you want an example?  Then look no further than Germany after WW1…here we are talking about economics and not the political theory that we all detest……because of direct government spending in infrastructure and industry….Germany was the first country out of the Great Depression…..

You may not like the idea….but think about it hard….how else will we pull ourselves out of the economic funk we live in today?  Sorry to pee on their parade….but spending cuts and tax breaks will NOT bring the US out of this making of our demise……and is it not government’s purpose to insure the country has a strong economy?

The Land Of Hungry Children

You have heard of the Land Down Under or the Land of the Free or possibly the Land that Time Forgot…..but there is another that is NOT reported so much by the mainstream media….poverty and hunger in the US….with all the crap that the economic collapse has given us there is one that is NOT acceptable, at least in my way of thinking……child poverty!

Black listed news was compiled an excellent list of horrible consequences……

#1 Child homelessness in the United States is now 33 percent higher than it was back in 2007.

#2 According to the National Center on Family Homelessness, 1.6 millionAmerican children “were living on the street, in homeless shelters or motels, or doubled up with other families last year”.

#3 The percentage of children living in poverty in the United States increased from 16.9 percent in 2006 to nearly 22 percent in 2010.  In the UK and in France the child poverty rate is well under 10 percent.

#4 A higher percentage of American children is living in poverty today than was living in poverty back in 1975.

#5 The number of children living in poverty in the U.S. has risen for four years in a row.

#6 There are 10 different U.S. states where at least one out of every four babies is born to a family living in poverty.

#7 Since 2007, the number of children living in poverty in the state of California has increased by 30 percent.

#8 According to the National Center for Children in Poverty, 36.4% of all children that live in Philadelphia are living in poverty, 40.1% of all children that live in Atlanta are living in poverty, 52.6% of all children that live in Cleveland are living in poverty and 53.6% of all children that live in Detroit are living in poverty.

#9 In the United States today, more than 35 percent of all African-American children are living in poverty and more than 33 percent of all Hispanic children are living in poverty.

#10 There are seven million children in the United States today that are not covered by health insurance at all.

#11 Today, one out of every seven Americans is on food stamps and one out of every four American children is on food stamps.

#12 It is being projected that approximately 50 percent of all U.S. children will be on food stamps at some point in their lives before they reach the age of 18.

#13 In 2010, 42 percent of all single mothers in the United States were on food stamps.

#14 There are 314 counties in the United States where at least 30% of the children are facing food insecurity.

#15 In Washington D.C., the “child food insecurity rate” is 32.3%.

#16More than 20 million U.S. children rely on school meal programs to keep from going hungry.

These show the extent of how bad the recession is on the kids….yes, it is bad for everybody (with the exception of Wall Street) but how bad does it have to get to force our politicians to face this problem?  I thought children were our future, if so the future is pretty damn bleak!

We have an election coming up soon……now would be a good time to show your distaste for the policies coming out of Washington……

It’s The Economy, Right?

I was watching CNBC the other day and the anchor got all bubbly because the market went up over 100 points and the GDP figures were in and it expanded by 2.5%, which is pretty good since the last two quarters sucked bad…..

The US’ total economic output shot up 2.5% from July through September, after two dismal quarters of rising just 0.4% and 1.3%, according to a new GDP report released today. Consumers amped up their spending on both durable goods and services, and business investments soared 16.3%—indicating that we may not be in for a second recession after all.

The numbers were also boosted by federal government spending, though drops in state government spending dampened that effect. And there’s some more moderately positive news: New jobless claims fell 2,000 this week, after dropping 7,000 last week. But that still leaves claims at 402,000—economists think claims must fall below 400,000 for job growth to outpace job losses.

All the pundits are jerking off at the news….but there is still no jobs!  There are still millions of Americans that are unemployed!  Then for whom is all this good news?  Apparently, investors and by investors I mean hedge funds and by hedge funds I mean the same thieves that help tank the economy in the first place……those figures will be seasonal adjusted……which means in the final analysis….it will NOT be as good as they want it to be….

Let’s review……..0.1% of the population controls 34% of the country’s wealth, and owned as much much money as the bottom 42%.  Corporate profits are up by 62%, and the earnings of the top percentage almost doubled, while the average raise for workers only rose about 9%.  The Prez and the Congress gave massive tax cuts and even the Supreme Court got involved in politics………(pause here to re-read)……Wait!  That was the crash of 1929, not 2008!  And just like 1929 the economic crisis spread worldwide…..

My point here that all this has happened before and for the same reasons, well almost the same reasons, The Prez was Coolidge in1926….and the Supreme Court got involved in the process by ruling the minimum wage law was unconstitutional (they were controlled by business kinda like today and the ruling in the “People United” thing)…..why allow the same things to occur over and over and do nothing to change the vicious cycle?

And just like the crisis in 1929….Tax cuts and deficit debate will do NOTHING to repair the failing economy…..Bold new ideas must be found and I do not see that possible with a Congress owned by special interests….and yes…that could mean a bit of socialism….

I suggest if you truly want change then find another path….they are there…you just have to want it!

Small Busisness To The Rescue

I hope that people are listening………I am sorry to be redundant but……..

Just how many times have you heard the crap from the GOP and from the president?  Small business creates all the jobs in this economy…..I have tried to help the people realize what a pile of bovine fecal matter the politicians are handing you….they are force feeding you erroneous information….and now it is not just me that is telling the voter what crap it is but Bloomberg’s Business Week…….

While extolling small business “might be a good way for politicians to win elections,” Bloomberg Businessweek notes that “the notion that small business is the force behind prosperity is not true.”

“Most small employers are restaurateurs, skilled professionals or craftsmen (doctors, plumbers), professional and general service providers (clergy, travel agents, beauticians), and independent retailers. These aren’t sectors of the economy where product costs drop a lot as the firm grows, so most of these companies are going to remain small.”

Read the article closely……..learn what is meant by small business….to the politicians they want you to believe that an oil company that employs a 1000 workers with $7 million in income is somehow a small business….not so!