So you are completely mad. The president, who appoints the head of the FED is selected, groomed and bankrolled by the financial aristocracy. Obama's earnings last year put him in the top 1% of earners, while the Clintons are in the richest 0.1% of Americans. These so-called representitives of the people are drawn from the ranks of the oligarchs.
To suggest that Obama, a degenerate oligarch, is a socialist, is a claim born of sheer desperation to justify the existence of a completely dyfunctional miserable failure--capitalism---and plain stupidity. Regulation under Obama=A free pass for Wall Street 18 June 2009 President Barack Obama on Wednesday announced what he called “a sweeping overhaul of the financial regulatory system, a transformation on a scale not seen since the reforms that followed the Great Depression.” The reality behind the rhetoric was indicated by the reaction on Wall Street. The stock market responded with a shrug, with the Dow and the S&P 500 finishing slightly down and the Nasdaq ending with a modest gain. Had there been anything in the proposals outlined by Obama that suggested a serious crackdown on the fraudulent practices that precipitated the present crisis, one can be certain the market would have reacted with a massive selloff. The insiders knew they had nothing to fear. The plan Obama presented was in all essentials formulated by Wall Street lobbyists and CEOs. The New York Times on Wednesday described the process by which the plan was drafted: “In the last two weeks alone, the administration has heard from top executives from Goldman Sachs, MetLife, Allstate, JPMorgan Chase, Credit Suisse, Citigroup, Barclays, UBS, Deutsche Bank, Morgan Stanley, Travelers, Prudential and Wells Fargo, among others. Administration officials also discussed the president’s plan with the top lobbyists at major financial trade associations in Washington.” The officials with whom the bankers consulted are themselves Wall Street insiders, headed by two protégés of former Goldman Sachs and Citigroup executive Robert Rubin—Treasury Secretary Timothy Geithner and the director of Obama’s National Economic Council, Lawrence Summers. The former was president of the Federal Reserve Bank of New York before becoming Obama’s treasury secretary, and the latter was treasury secretary under Bill Clinton. They played major roles in lifting regulations and facilitating the orgy of speculation that ended with the Great Crash of 2008. The plan outlined by Obama calls for enhanced powers for the Federal Reserve to oversee big financial firms, both bank and non-bank companies; higher capital reserve and liquidity requirements; minimal government oversight of some hedge funds; a privately-run clearinghouse for some forms of derivative trading; and a requirement that lenders retain a small stake in loans they sell to the banks to be turned into securities. All of these requirements can be easily circumvented by the banks. Moreover, the political forces responsible for enforcing them are bound hand and foot to Wall Street. The panoply of existing federal regulatory agencies is for the most part to remain in place. Obama made much of the creation of a new body, the Consumer Financial Protection Agency, which he said would protect consumers against predatory practices by mortgage lenders and credit card companies. However, this agency will have no new powers beyond those previously spread out among other agencies. The centerpiece of the plan is a proposal to allow the Fed and the Federal Deposit Insurance Corporation to seize and wind down big banks and non-bank financial firms whose failure would pose a “systemic threat.” This is considered necessary precisely because none of the other proposals challenge the ability of banks, hedge funds, insurance companies and other financial firms to engage in speculative practices that are certain, at some future point, to threaten another financial collapse. It amounts to the institutionalization of taxpayer bailouts of the financial system, in place of the ad hoc methods employed in the present crisis. Obama’s speech was a typical performance—populist gestures and verbal wrist-slaps for the bankers combined with paeans to capitalism and the free market. He cited as “significant contributors” to the crisis the failure of government regulators and “abuse and excess” on Wall Street. He spoke of the proliferation of complex financial instruments, such as asset- backed securities, that generated “easy money” but were “built on a pile of sand.” Executive compensation, he said, “rewarded recklessness rather than responsibility.” What he called “systematic and systemic abuse” and “the failure of the entire system” had inflicted “terrible pain in the lives of ordinary Americans,” with “retirees who’ve lost much of their life savings, families devastated by job losses, small businesses forced to shut their doors.” “Millions of Americans,” he continued, “who’ve worked hard and behaved responsibly have seen their life dreams eroded by the irresponsibility of others and by the failure of their government to provide adequate oversight. Our entire economy has been undermined by that failure.” Having painted a picture of a corrupt economic system that preyed upon the people and caused suffering and social devastation, he moved on to the business at hand—keeping the system going and the profits flowing. He hastened to reassure his most important audience, Wall Street, declaring, “I’ve always been a strong believer in the power of the free market. It has been and will remain the engine of America’s progress... I believe that our role is not to disparage wealth, but to expand its reach.” This was a signal to those who have benefitted from plunging the country and the world into economic disaster that they will continue to benefit, and will face no consequences for their crimes. When all is said and done, they will make more money than ever. Indeed, the New York Times published an article on Monday entitled, “In Banks, Return of the Big Bonus.” It began, “The stage is set for the return of supersize banker bonuses,” and went on to speak of “headline bonuses of $10 million or more” for Wall Street bankers and traders. The comparison of Obama’s plan to the regulatory reforms of the 1930s is specious. In the depths of the Depression, Roosevelt imposed significant structural reforms to rein in the banks and save American capitalism from the threat of social revolution. A cornerstone of these reforms was the Glass-Steagall Act of 1933, which erected a barrier between commercial banks and investment banks. Glass-Steagall was repealed in 1999, during the Clinton administration. That was a milestone in the deregulation of the banks. It was part of a process, stretching back to the early 1980s, in which the US ruling elite has turned increasingly to financial manipulation to generate profit and personal wealth, while dismantling huge sections of industry and waging relentless war against the jobs and wages of the working class. The result has been a colossal growth of social inequality and the emergence of a financial oligarchy that dominates the political life of the country. Both parties are at the beck and call of Wall Street, and are incapable of enacting any measures to rein in its plundering of the social wealth. Obama and the Democratic-controlled Congress have ruled out a return to Glass-Steagall. They have rejected capping executive pay. Nor is there any suggestion of closing down the casino for credit default swaps, collateralized debt obligations, structured investment vehicles and other exotic forms of speculation that played a major role in the financial crash. Far from limiting the size and power of the big banks, the government has used the crisis to encourage a further consolidation of the banking system. As a result of the disappearance of Bear Stearns, Lehman Brothers, Merrill Lynch, Wachovia and Washington Mutual—to name just the biggest bank failures—the four largest US banks today account for 70 percent of the country’s bank assets, as compared to less than 50 percent at the end of 2000. This process of consolidation will accelerate under Obama’s regulatory scheme. The premise of Obama’s plan is a lie. The crisis is not fundamentally the result of mistakes or malfeasance on the part of bankers and government regulators—as plentiful and destructive as they were. It represents the failure of the system to which Obama pays homage— capitalism. There is no solution outside of socialist measures—beginning with the nationalization of the banks under the democratic control of the working population—to break the back of the financial oligarchy and reorganize economic life in accordance with social needs, not private profit. That requires the development of an independent political movement of the working class in opposition to the Obama administration and both parties of big business. Barry Grey On Aug 10, 9:37 pm, bruce majors <[email protected]> wrote: > Our money is created by the State > It is a state monopoly > > Our banks are completely regulated and are headed by a Federal Reserve > System whose Chairman is appointed by the President > > It's governors are confirmed by Congress > > It exists to buy government Treasury bills with fiat currency in order to > fund government debt with the secret tax of inflation that transfers the > purchasing power of our savings to government > > This is socialism > > SInce you are ignorant of this you can learn more about it from such books > as Tom Wood's "Meltdown" or Lawrence White's "Competition in Currency" > > > > On Mon, Aug 10, 2009 at 1:45 AM, "Lone Wolf" <[email protected]> wrote: > > > 72 failures so far this year > > Three more US banks collapse > > By Patrick O’Connor > > 10 August 2009 > > > US regulators closed another three banks last Friday: First State Bank > > and Community National Bank, based in Florida, and Oregon’s Community > > First Bank. The Federal Deposit Insurance Corporation (FDIC) is > > expected to pay out $185 million to cover closure costs and insured > > deposits for the three institutions. A total of 72 US banks have > > collapsed so far this year, up from 25 in all of 2008 and three in > > 2007. > > > Recent bank failures have highlighted the financial system’s > > unresolved toxic asset crisis. An estimated $2 trillion in bad debt > > remains on the banks’ books, with banks refusing to write down or sell > > assets whose real worth is only a small fraction of their nominal > > value. Compounding many banks’ problems is the ongoing contraction in > > economic activity, which, in turn, is rebounding on the financial > > sector. A collapse in the commercial real estate market is now widely > > feared. > > > At the end of the first quarter this year, the FDIC listed 305 unnamed > > institutions with a combined asset value of $220 billion as “problem > > banks” at risk of collapse. > > > Smaller regional banks have been among the first to go under. Of the > > latest collapses, Community National Bank had assets of $97 million > > and deposits of $93 million, Community First Bank had $209 million in > > assets and $182 million in deposits, and First State had $463 million > > in assets and $387 million in deposits. These figures pale in > > comparison to the trillion dollar holdings of the largest US banks. > > The elimination of many smaller institutions is in line with the > > strategy of the biggest banks, aided by the Obama administration, to > > utilize the economic crisis to engineer a sweeping reorganization of > > the banking and financial system, concentrating greater market share > > and economic power in the hands of a few giant firms. The Troubled > > Asset Relief Program (TARP) and other bailout measures overseen by the > > Obama administration and the Federal Reserve have enabled firms such > > as Goldman Sachs and JP Morgan Chase to reap record or near-record > > profits—and reward their leading personnel with bonuses as big or > > bigger than the multi-million-dollar payouts that preceded the crash > > of 2008. This is in part due to the elimination of major rivals such > > as Bear Sterns, Merrill Lynch, Washington Mutual and Lehman Brothers. > > > In the banking sector, the FDIC is playing the central role in the > > consolidation drive that aims at creating a network of mega-banks. > > > This year’s string of bank collapses has cost the federal insurance > > fund more than $15 billion in insured deposits and other expenses. As > > a result, the fund is 75 percent under its statutory minimum balance. > > > To help make up the shortfall, a fee has been levied on member banks, > > further eating into the limited revenues of many smaller institutions. > > The Baltimore Business Journal recently noted the case of Maryland’s > > Sandy Spring Bank, which on July 23 reported second quarter losses of > > $1.5 million after paying an FDIC surcharge of $1.7 million. > > Additional levies are expected later in the year. > > > At the same time, the FDIC is selling failed banks to larger > > institutions at bargain prices—and in many cases with a no-loss > > guarantee on bad debts. “Cleaning up after bank failures is one chore > > you won’t hear bankers complaining about,” Fortune magazine noted in > > an article last month, which highlighted the FDIC’s so-called loss- > > sharing agreements. “It’s this provision—capping the acquirer’s losses > > at the expense of the fund—that is most alluring.” > > > Throughout the economic crisis, the Obama administration’s central > > imperative has been to protect the interests of the financial elite by > > placing virtually unlimited public funds at its disposal. > > > The Federal Reserve has enacted a series of measures—without either > > public discussion or congressional authorization—to funnel public > > monies to leading banks and financial institutions. The Financial > > Times last week noted the highly favorable terms granted to securities > > traders by the Fed, which has emerged as one of the financial sector’s > > biggest customers. > > > Citing officials and industry executives, the newspaper concluded: > > “Wall Street banks are reaping outsized profits by trading with the > > Federal Reserve, raising questions about whether the central bank is > > driving hard enough bargains in its dealings with private sector > > counterparties.” > > > Major banks are also set to collect nearly $1 billion in fees from the > > Fed for their role in breaking up the failed insurance giant American > > International Group (AIG). The Wall Street Journal, which calculated > > the figure, noted that this “would represent one of Wall Street’s > > biggest pay days.” Morgan Stanley, set to collect up to $250 million, > > is among the largest beneficiaries. Goldman Sachs, Bank of America, > > and JPMorgan Chase are also expected to cash in through advisory > > services and underwriting assignments. > > > AIG stock rose 18 percent last Friday after the insurer and financial > > services company—now 80 percent government-owned—reported an > > unexpected second quarter profit of $1.82 billion. The profit was > > AIG’s first since late 2007. Executives reported that it was due to > > parts of its business stabilizing as well as a favorable accounting > > change. > > > AIG also announced that it was paying $249 million in so-called > > retention bonuses to executives for the second half of 2009. This > > includes $93 million for its Financial Products division, whose > > speculation in derivatives led to the company’s near-collapse last > > year and a $173 billion government bailout. The firm’s entire > > retention program is set to cost more than $1 billion over the next > > three years. > > > The announcement, made just five months after the public furor over > > AIG’s bonus payments to those responsible for bankrupting the company, > > bore a provocative character and reflected the brazenness of the > > financial oligarchy. Late last month, a report issued by New York’s > > attorney general showed that nine leading banks and financial > > institutions receiving government bailout money paid out bonuses > > totaling $33 billion last year. Six of the nine paid out more in > > bonuses than they made in profits. (See: “Billions in bonuses for > > bailed-out bankers”) > > > One of the firms listed in the report, Wells Fargo Bank, last week > > announced that it was awarding its four senior executives pay rises of > > between 400 to 600 percent. CEO John Stumpf will now receive a > > $900,000 base salary and $4.7 million in company stock. The massive > > salary increases are designed to evade federal rules limiting bonus > > payments for companies holding TARP bailout money. These mandated > > limits, as Wells Fargo has now demonstrated, were never more than > > token measures promoted by Democratic congressmen as a means of > > covering themselves in the face of mounting public anger. > > > The socially destructive activities of the banks and financial > > institutions are continuing to inflict severe hardship on broad > > sections of the population. > > > Credit for consumers and small business owners remains either > > unavailable or too expensive. The Federal Reserve reported Friday that > > consumer credit in the US declined in June for the fifth straight > > month. Banks have also hiked their fees and charges, > > disproportionately affecting low-income earners. > > > The Financial Times yesterday reported that research company Moebs > > Services found US banks stood to collect $38.5 billion in customer > > overdrafts this year. “The crisis has prompted many banks to lift > > charges on overdrafts and credit cards in order to boost profits,” the > > Financial Times noted. “The most cash-strapped customers are the > > hardest hit by such fees, with 90 percent of overdraft revenues coming > > from 10 percent of the 130 million checking accounts in the US. > > Regular use of overdrafts is most common among consumers with low > > credit scores, Moebs discovered.” > > > While the major banks, bolstered by trillions of dollars in government > > cash and subsidies, are reporting higher earnings, American workers > > are suffering a drastic fall in wages. Commerce Department data > > released August 4 showed a 4.7 percent fall in wages and salaries in > > the twelve months to June—the largest decline since records began in > > 1960. Data also showed reduced personal income and consumer spending. > > > Edmund Phelps, a Nobel Prize-winning economist at New York’s Columbia > > University, responded to the Commerce Department figures by telling > > Bloomberg Television: “Households are going to have to do an awful lot > > of rebuilding of their wealth. Even if that rebuilding goes on at a > > pretty good clip, it will take 12 or 15 years for households to get to > > the wealth level that they had several years ago.” > > > > competition-currency_130.gif > 11KViewDownload > > Meltdown.jpg > 65KViewDownload- Hide quoted text - > > - Show quoted text - --~--~---------~--~----~------------~-------~--~----~ Thanks for being part of "PoliticalForum" at Google Groups. 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