Ditch your credit cards 3
Deep Throat, in the 1976 Watergate film All the President’s Men, told Bob Woodward [Robert Redford] in that late night, dark garage about where Woodward was going wrong with the investigation:
Follow the money.
Don’t be waylaid by abstract philosophies and childish talk of who called whom scumbag – this just distracts your attention away from the real issues going down. Cherry Pie wrote: “As to credit cards, as long as you pay them off at the end of every month they are OK!”
Commendable thought but she was hit by a barrage over that, dear lady and this post goes into why. At the same time, Wolfie wrote: “Right now I’m a lot more worried about the sovereign debt situation.”
Bloomin heck, which path to go down first – the credit and debt economy or sovereign debt, two sides of the same coin? OK, let’s complete the credit/debt side first and then tackle the sovereign debt in the next post.
Xxxl has dropped in my lap the very words I wanted to say but couldn’t make succinct enough and this comes out also in the sovereign debt question. He was basically answering Cherie:
The Casino branch of banks:
1) Takes a position buying the shares of a particular company;
2) Enters the futures markets so as to influence (perhaps) the raw material prices of that company;
3) The movement in the raw material prices affects the profitability of that company, (lets say it increases the profitability…. to keep it simple), therefor the shares held by the bank increase in value.
4) Issues “broker” advice to “buy” that equity. – further equity price increase.
5) You buy the produce of that company, using your plastic.
6) Because you used your plastic, the finance provider (bank) takes anything up to 3% of the price, from the retailer, as their fee for providing the service. So whether or not you pay up on time, the banks benefit. (You can eliminate the 3% bank sequestration by paying cash to the retailer)
And because of their actions in the futures markets, they have also benefited via their equity holdings, and by the fact that their 3% is on a higher price.
Their international size and power to control are entirely disproportionate to the economic value they create. In many cases they create neg. economic value because of the severity of the charges. They are effectively a tax on almost every financial transaction in an economy…. and that is just at the retail level. They have their own Tobin Tax
So things are NOT OK!
Indeed, the financial transactions per capita in the west tell a story of a world dominated by what should really be a service provided to enable economic life, becoming a means to its own end, economic domination via power. And that power is now great enough to take down entire nations, and affect, via derivatives, any damn thing globally they wish to affect.
One of my sources for the next part is here, in case you wish to follow with your own reading, also here and here. [I'm telegraphing my moves ahead of time.] Other reading is here and here.
Your humble blogger is just an ordinary keyboard tickler like you. I might research a bit more than the average bear, I might be more open to ideas than the average Eastenders watcher out there but like you, I neither understand nor fully appreciate the knock-on effects of economics, nor am I particularly interested.
I know though that I must START getting interested because in these current goings on is the past, present and future. The scams being perpetrated on the people as a whole are mindboggling and where ecopundits fall down is that they can’t break it down into understandable, bite-sized chunks, free of jargon. Xxxl has come close to it in the above, even if he gets a bit wonky with the jargon in places.
The worst aspect of all of it is that it is history repeating itself. As Einstein said:
Insanity [is] doing the same thing over and over again and expecting different results.
He was being kind, in the case of the international financial houses – there’s is a scam, a deliberate ripping off of the people, with collusion at all levels of government. Why haven’t you heard about the details? Because the MSM is bought – every blogger knows that.
Do try to become interested in this, people. I know it’s a chore but your future may well depend on it. Can you repair a car without knowing how an engine works?
Filed under: Politics & economics
EU democracy in action
I’ll open the next one with this.
Some people wonder why it is that so many countries were running such high deficits prior to the financial crisis? Surely a country would pay down debt in the good times? Maybe you should ask the WTO?
http://www.washingtonsblog.com/2010/02/other-reason-that-us-is-not-regulating.html
“Can you repair a car without knowing how an engine works?”
I know of enough people who will hit their car engine with a hammer and, on the offchance it bursts into life, be content that they know enough. Perhaps this is the modus operandi of the education dumbing down -> replace rational thought-based learning with exposure to experiences. Once you control the ‘learning’ environment and produce enough experiences caused by a contrived set of circumstances (I guess that this might be the ultimate aim of sex education these days – to get the masses thinking about sex and little else), you can control the populace who think that they know enough to survive in a authority-compliant manner, but do not engage their brains to think deeper, e.g. why should they comply with authority in the first place (and all the implication chains that flow therefrom).
This could be more compactly expressed using the old management aphorism of ‘past experience is always true, never be misled by present facts’.
http://2.bp.blogspot.com/_pCDyiFUv9XU/S3gcsQe2J3I/AAAAAAAAIms/Ko6rus-r2eo/s1600-h/61281575aa7ba69571877aacddd1e5fb-1.jpg
Not Wonky.
Every word was chosen for its certain meaning.
Quite deliberate.
Andrew.
I’m winning…
Golman Sachs….”A hedge fund with a roladex of bought politicians”.
legally classified as a “Bank Holding Company”, to enable access to cheap Fed funding. Has NO retail banking branch outlets, anywhere.
John Whitehead – Had a 38 year career at Goldman Sachs – he retired in 1984 as Co-Chairman and Co-Senior Partner. He served as United States Deputy Secretary of State in Ronald Reagan’s administration from 1985 to 1989 under George Shultz, and was awarded the Presidential Citizens Medal by President Reagan. In 1996, he was the campaign chairman for Michael Benjamin who ran for a seat in New York’s 8th congressional district. He is former Chairman of the Board of the Federal Reserve Bank of New York, the United Nations Association, and a former Chairman of The Andrew W. Mellon Foundation and the Harvard Board of Overseers. He is a former director of the New York Stock Exchange and Chairman Emeritus of The Brookings Institution.
Robert Rubin – served as the 70th United States Secretary of the Treasury during both the first and second Clinton administrations. Before his government service, he spent 26 years at Goldman Sachs serving as a member of the Board, and Co-Chairman from 1990-1992.
Henry Paulson – as the 74th United States Treasury Secretary. He previously served as the Chairman and Chief Executive Officer of Goldman Sachs.
John Thain – The last chairman and chief executive officer of Merrill Lynch before its merger with Bank of America. Before he came to Merrill, Thain was the CEO of the New York Stock Exchange from January 2004 to December 2007. He also worked at Goldman Sachs, as head of the mortgage desk from 1985 to 1990, and president and co-chief operating officer from 1999 to 2004.
Robert Steel – Served as Under Secretary for Domestic Finance of the United States Treasury from 2006-08. He has also served as president and CEO of Wachovia Corporation and as vice chair of Goldman Sachs.
Edward Liddy – Was on the board of Goldman Sachs from 2003 to 2008, when he resigned to become CEO of AIG. He was selected by Henry Paulson for both roles.
Stephen Friedman – Former Chairman of the Federal Reserve Bank of New York, resigned on May 7, 2009. Worked for much of his career with investment bank Goldman Sachs, holding numerous executive roles. He served as the company’s co-chief operating officer from 1987 to 1990, was the company’s co-chairman from 1990 to 1992, and the sole chairman from 1992 to 1994; he still serves on the company board.
William Dudley – Worked 21 years at Goldman Sachs, succeeded Tim Geithner as President of the New York Federal Reserve in 2009.
Josh Bolten – Worked 5 years at Goldman Sachs, became White House Chief of Staff for George W. Bush.
Reuben Jeffrey – Had an 18 year career at Goldman, left in 2001 when President Bush appointed him as his Special Advisor on Lower Manhattan Development, and in 2002, Jeffery left Goldman Sachs to take on this responsibility. In 2003, Jeffery became a Special Advisor to L. Paul Bremer, head of the Coalition Provisional Authority in Iraq and then became the Representative and Executive Director of the Coalition Provisional Authority Office in The Pentagon. He served as a member of the United States National Security Council until 2005, as a Senior Director responsible for International Economic Affairs. Jeffery was named the chairman of the Commodity Futures Trading Commission. On April 16, 2007 President Bush nominated Jeffery as Under Secretary of State for Economic, Business, and Agricultural Affairs.
Arthur Levitt Jr. – Former Securities and Exchange Commission [S.E.C.] Chairman and senior advisor to the Carlyle Group began advisory role with Goldman Sachs in June 2009.
Rahm Emanuel – Current White House Chief of Staff [Obama], was originally hired by Bill Clinton as his chief fundraiser. At that time [1992] Emanuel was on the payroll of Goldman Sachs, receiving $3,000 per month from the firm to ‘”ntroduce us to people” according to a Goldman partner.
Gavyn Davies – Former Chief Economist at Goldman Sachs and current President of the British Boadcasting Corp. [BBC] is married to British Prime Minister Gordon Brown’s special adviser Sue Nye.
Gerald Corrigan – Was a special Assistant to Federal Reserve Board Chairman, Paul Volcker in Washington, D.C. He went on to serve as president of the Federal Reserve Bank of Minneapolis from 1980 to 1984 and President of the Federal Reserve Bank of New York from 1985 until 1993. From 1991 to 1993 he was Chairman of the Basel Committee on Banking Supervision. From 1993 to 1995 he was director of the Council on Foreign Relations. Dr. Corrigan is currently a partner and managing director in the Office of the Chairman at Goldman Sachs and was appointed chairman of GS Bank USA, the bank holding company of Goldman Sachs, in September 2008. He is also a member of the Group of Thirty, an influential international body of leading financiers and academics.
Duncan Niederauer – Was appointed chief executive officer and director of NYSE Euronext, effective December 1, 2007, after joining NYSE Euronext in April 2007 as a member of the Management Committee. Mr. Niederauer also serves on the boards of NYSE Group and Euronext N.V. Mr. Niederauer was previously a partner at The Goldman Sachs Group, Inc. (United States) (GS) where he held many positions, among them, co-head of the Equities Division execution services franchise and the managing director responsible for Goldman Sachs Execution & Clearing, L.P. (formerly known as Spear, Leeds & Kellogg L.P.). Mr. Niederauer joined GS in 1985. From March 2002 until his resignation in February 2004, Mr. Niederauer also served on the board of managers of Archipelago Holdings, LLC (United States).
Lawrence Summers – Director of the White House’s National Economic Council for President Barack Obama and former Secretary of the U.S. Treasury [Clinton].. In 2008, Summers was paid 135,000 for giving a speech to Goldman executives.
Jon Corzine – Served five years of a six-year Senate term before being elected Governor in 2005. He was defeated for re-election in 2009 by Republican Chris Christie. Former Chairman and co-CEO of Goldman Sachs. Left firm in 1998 and entered politics.
Gary Gensler – Chairman of the U.S. Commodity Futures Trading Commission [CFTC] under President Barack Obama. Gary Gensler spent 18 years at Goldman Sachs, making partner when he was 30, becoming head of the company’s fixed income and currency trading operations in Tokyo by the mid-’90s.
Robert Zoellick – Is the eleventh president of the World Bank, a position he has held since July 1, 2007. He was previously a managing director of Goldman Sachs, United States Deputy Secretary of State (resigning on July 7, 2006) and U.S. Trade Representative, from February 7, 2001 until February 22, 2005.
Neel Kashkari – In July 2006, Kashkari was appointed as a special assistant to Treasury Secretary Henry Paulson. In the summer of 2008, he was appointed assistant secretary for international economics and was confirmed in that post by the U.S. Senate. On October 6, 2008, Paulson named Kashkari interim head of the new Office of Financial Stability. Overseen by the treasury secretary, he is in charge of creating and implementing the United States government’s $700 billion financial stabilization program. Prior to joining the Treasury Department, Kashkari was a Vice President at Goldman, Sachs & Co. in San Francisco.
Mario Draghi – Head of the Bank of Italy and former mentor to current U.S. Treasury Secretary, Tim Geithner. Draghi was vice chairman and managing director of Goldman Sachs International and a member of the firm-wide management committee (2002-2005).
Mark Carney – Governor of the Bank of Canada. Before joining the public service, Carney had a thirteen-year career with Goldman Sachs in its London, Tokyo, New York and Toronto offices.
Well of course I expected a barrage from a comment like that
I have to thank XXL for adding the missing puzzle piece that I couldn’t quite get figured in my head.
As to the childish talk there is a bit more to that than meets the eye too!
Ooops! there is a missing X from XXXL in my previous comment. Sorry
[...] # Ditch your credit cards 3 [...]
Yep, he causes all sorts of mayhem.