At Last A Little Good News About The Banksters.

“Fight Against Stupidity And Bureaucracy”

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Bank Logos-2

Don’t get too excited, it is only a little, but it is good news.

In a recent ruling by British regulators, the top executives and managers at banks operating there (which is practically all the major banks) could have their bonuses clawed back for up to ten years after any finding of misconduct. It will also prohibit bonuses for nonexecutive directors and for the managers of companies that are receiving financial support from the government.

The move, which is long, long overdue and still does not go far enough, extends a seven-year clawback period that one regulator, the Prudential Regulation Authority, (part of the Bank of England), introduced for so-called variable pay (read ‘bonuses’) last year as part of tougher accountability rules.

Prudential Regulation Authority

The new rules announced by the authority, which is part of the Bank of England, and by another regulator, the Financial Conduct Authority, are the latest effort by financial regulators in Europe to hold the banksters accountable for improper actions that could play a role in precipitating future financial upheavals.

The regulators say they are trying to “embed an accountable culture” in the City of London, which actually means that the authorities realize that the banksters have learned nothing from their previous catastrophic frauds and thefts. They know when the chance arrives these greedy and immoral people will try to do it all again.

bankster caricature

The new British rules, which apply to banks, building societies and investment firms regulated by the Prudential Regulation Authority, including British units of United States banks and other financial firms based outside Europe, mean that senior managers, risk managers and others at banks will also be asked to defer more of their variable pay for a longer period, making it easier for regulators and financial institutions to recover bonuses if misconduct is uncovered.

Other countries in Europe are also enacting new regulations for their banksters. Dutch lawmakers, for example, capped bonuses this year for employees in the banking, insurance and other finance sectors that limits variable pay to 20 percent of their fixed salaries. The Dutch have also banned bonuses for executives at bailed-out banks.

European rules already limit bankers’ bonuses to the equivalent of their annual salaries, or to two times their base salaries if the company’s shareholders approve it. But they know they are so greedy that they will try to find ways round that.

breaking the rules

Already some banks are making moves to get round the limits by introducing role-based remuneration and other payments, so the regulators have their work cut out for them keeping a step ahead of the thieves.

What they really need to do is confiscate ALL their ill-gotten gains, impose severe additional financial penalties AND throw these criminals in jail – for a long time.

America, which always likes to consider itself as the leader of the world, should lead in this regard too. It would be better than starting another war in some far off God forsaken country.

Unfortunately I think it will be an equally long time, and a lot more frauds, before they get to that much needed stage.

And you can take that to the bank!

Give a man a bank

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Jobs, Jobs, And More Jobs

“Fight Against Stupidity And Bureaucracy”

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jobs under the magnifying glasss

This post is about jobs.

You might have guessed that from the title.

Not the late Steve, the other kind.

During the past months America has been creating approximately 200,000 jobs. At least that’s what the official figures are saying. It has helped to indicate the underlying strength of the economy, led to official unemployment figures of 5.5% and propped up the USD on the foreign exchange markets.

And no one is questioning any of it.

It’s as if it’s really real.

Again it’s all a question of what you do with the numbers.

unemployment

The May 2015 figure for the labor force is 157.5 million. That is the figure the government uses to calculate it’s unemployment rate of 5.5%.

That’s what they call the ‘U3’ number. U3 is the official unemployment rate.

But there is also a ‘U5’ number that includes discouraged workers and all other marginally attached workers; and a ‘U6’ number that adds on those workers who are part-time purely for economic reasons.

Don’t ask me what happened to ‘U1’ or ‘U4’ because I don’t know. However ‘U2’ is a very successful pop group from Dublin, Ireland.

u2 image

The problem is that the “official” unemployment rate (U3) does not count discouraged workers who have settled for part-time jobs or have given up looking altogether because they believe there are no jobs out there for them.

There are about another 7.5 million or so people who were not considered ‘unemployed’ because they were employed part-time for economic reasons. Those people are also called involuntary part-time workers – working part-time because their hours were cut back or because they were unable to secure a full-time job.

If you include those individuals, (the U6 number), you get a very different figure for the nation’s unemployment rate. Unlike other jobs figures, the U6 rate actually got worse in June.

So the real unemployment rate is well in excess of 12%, more than double the official figure.

But it is even worse than that.

The economy is growing, BUT it is growing slowly, and it is growing from a very low base caused by the financial crisis that the banksters brought upon us with their fraud and greed.

In that light, an increase of 200,000 jobs or so each month is basically just replacing some of the millions of jobs lost during the bank-caused recession, not creating ‘new’ jobs as such. In other words we’re just slowly getting back to where we were.

The forecasts aren’t optimistic either. If and when the workers laid off during the recent recession find new jobs and we get to what the government calls full employment, the labor force is forecast to grow at a rate of only 0.5% for the rest of this decade. At 0.5%, we grow at a rate of about 66,000 a month — nowhere near 200,000. Next decade it’s even worse, at 0.2%.

government bureaucrats

Add to that the fact that a great number of the jobs being created are government bureaucratic jobs that cost the country money, not real jobs that produce wealth for the country and you can see that there is little for the politicians to crow about.

As I noted in my post on Wednesday, with statistics you can ‘prove’ anything. Take any government figures with a great big pinch of salt.

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They Got Away With It AGAIN!

“Fight Against Stupidity And Bureaucracy”

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banks admit forex manipulation

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Last week several of the ‘BIG’ banks – you remember, the ones that are too big to let go bust – were fined in the region of $5.7 billion for illegal manipulation of the currency markets.

The usual suspects were included, J P Morgan, Citibank, Barclays  and RBS all pleading guilty – but only after they were sure what the medicine they would be getting would be.

It’s a huge amount of money, there’s no denying that. And losing it will make the banksters hurt a bit. But only a bit.

And that’s the problem.

Yet again the United States government has failed to bring these criminals to justice after more of their deliberate fraud and theft.

In other words, they let them get away with it AGAIN!

Major Banks

Now, if I walk into a branch of, for example, Citibank and try to steal the money that their customers have deposited with them for safe-keeping, I would be videoed, photographed, and if I was lucky enough to get out of the premises, pursued by the police and even the FBI for as long as it took to capture me.

And I couldn’t have any complaints because that’s the way it should be. Thieves should be sought out, captured and after due process thrown into jail.

However, if I am a bankster, have good government contacts, and ply money and favors to those in government, then I am treated very differently.

big banks get out of jail free

I can embark on insider trading (which is essentially what the banksters were doing when they were illegally manipulating the currency markets), I can sell loans to people that clearly can’t afford them, then take their houses away or sell on their debt wrapped up in a ‘AAA’ bundle to my richer customers, and after all that steal even more of the money my customers have entrusted to me by awarding myself and my collaborators big bonuses that none of us have earned or are entitled to.

In this scenario am I pursued by the police and FBI?

Nope.

Am I thrown in jail to be the bitch of Skull-cracker Jones or Scarface Smith?

Nope.

Will I have to personally pay back the money I stole?

Nope, again.

So what will happen to me if I am a bankster?

At worst I will get a slap on the wrist and told not to do it again. Even though recent history has proved that this is no deterrent and I will do it again at the first opportunity I get.

And, of course, I don’t have to personally pay the government’s fine no matter how big it may be. Instead my company has to cough up on my behalf.

Not that the company is much bothered either because when it runs out of money it goes back to the government which hands it back at least the value of the fine and usually much, much more.

Think this system is fair?

Neither do I.

jail the banksters

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The Banksters Balls It Up Again!

“Fight Against Stupidity And Bureaucracy”

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I wrote a post a few weeks ago about the effect that low oil prices would have on the banks. (Click here if you want to read it.) and another the week before last about the reasons for the decline in the oil price (click here if you want to read that)

As they always do, the idiots that run these financial institutions saw something they thought was going to last forever and threw their money and their clients’ money at it without reason.

Nowhere was this type of recklessness more apparent than during the sub-prime fraud when the banksters lent money to people who clearly could not afford it and then sold on those loans as bogus ‘AAA’ securities to their wealthy customers and other buyers who mistakenly thought that the banks would not try to con them.

cartoon happy banker

Well the banks have done more or less the same today.

Banks have been lending hand over fist to oil companies and those who service the energy sector. They have lent billions of dollars that  –  now the oil price has plummeted  –  has no chance of being paid back. They have underwritten bonds, lent money on expensive fracking operations and even financed the speculative building of homes for oil workers.

It was good while it lasted. But it didn’t last long!

In the 1980s something similar happened when energy prices also slumped. Texas was particularly hard hit and many banks either collapsed or had to be rescued because of their bad loans to oil companies and to local real estate developers speculating on the oil boom.

It’s going to happen again.

The bankster’s greed and stupidity means that their banks are going to take another financial hit, they are going to lose more of their customers’ money. Time for another round of big bonuses, if the last disaster is anything to go by!

Obviously they have been too stupid to learn from the past. Not surprising really.

cartoon sad banker

But the big question is what will government do this time?

Has it learned anything?

Will the government let the banks suffer the consequences of their own stupidity, as they should have when the sub-prime catastrophe hit?

Or will they again use OUR money to bail the banks out, making some nonsense excuse that these companies “are too big to allow to go under”?

And we are talking about BIG banks. Wells Fargo, for example, a huge financial powerhouse, made approximately 15 percent of its investment banking revenue from the oil and gas industry during 2014. Another biggie, Citigroup, was much the same, with this sector accounting for around 12 percent.

And it’s not just in America that the pain is being felt this time.

In Canada, which largely avoided the worst of the sub-prime debacle, some of their leading banks could face an even sharper decline in revenues, so reliant is the whole country on the energy and resources sectors. One of Canada’s biggest banks, Scotiabank, derives approximately 35 percent of its investment banking revenue from oil and gas companies, according to 2014 figures.

wall_street_crooks

Then there’s Wall Street.

Usually they make loans like these and sell them off to unsuspecting investors, however, with the very public fall in oil prices that everyone knows about, firms that financed energy deals are now finding it harder to offload this debt.

As an example of their problems, according to a recent NYT report, Morgan Stanley, was among a group of banks that made $850 million of loans to Vine Oil and Gas, an affiliate of Blackstone, a private equity firm. They are still trying to sell on that debt, but no one is buying. Goldman Sachs and UBS led a $220 million loan last year to the private equity firm Apollo Global Management to buy Express Energy Services. Not all that debt has been sold to other investors either so they are left holding that baby too.

That’s only loans to the oil companies and speculators. Some of the worst loans made by the banks have been to a multitude of companies that provide services to the oil industry. Some of these services companies, lured by the oil boom, are relatively new and/or small and probably under-capitalized so their debt burden can quickly drag them under when projected profits fail to materialize.

Naturally you can expect that the banksters will use all their lobbying and political power to make sure the government steps in again.

But the truth is the government really does not need to (they didn’t the last time either). The ‘to-big-to-fail’ banks may lose on their energy bets, but they will recoup a lot of that money from ordinary people like you and I.

Lower oil prices means that we need less cash to fill up our gas tanks or heat our homes, so the chances are we will feel a bit freer to use that credit card or maybe even take out a mortgage.

Of course, for the banksters that’s a slow way to riches. They want that business for sure, but they will also want the government to write off their other bad loans too.

Let’s see what happens this time.

collapsing bank sign

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Corruptocracy!

“Fight Against Stupidity And Bureaucracy”

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A Sunday Sermon

It’s been a while since I did a Sunday Sermon. It’s an occasional, rather than a regular, feature here at the fasab blog. It just happens when I’m in the mood to have a bit of a rant about a subject that I consider to be serious.

If you have read much of my blog you will know that two of my favorite targets are the banksters and politicians. When they act alone they are dangerous, when they combine their forces they are lethal.

Today I’m taking aim at both of them.

Strap yourselves in, here we go….

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corruptocracy

In the wake of the financial catastrophe that the greedy banksters inflicted on the world there has been a lot of talk (but very little real action) about bringing these thieves under some kind of control.

Naturally the banks are fighting tooth and nail against any kind of financial reform and they have the contacts and the financial resources to do it.

They have, for example, dragged their heels at every opportunity, used our money (kindly donated by a stupid government) to lobby friendly and unprincipled politicians in Congress to repeal aspects of Dodd-Frank, sent armies of lawyers to frustrate regulators and make any new rules as weak as possible and threatened a plethora of legal challenges and lawsuits.

It has been a ‘David and Goliath’ battle but this time the richer and more powerful Goliath seems to be winning.

David and Goliath

Unsurprisingly the banks’ biggest political allies in opposing the much needed financial reforms have been Democrats, such as the Robert E. Rubin wing of the Democratic Party, which has opposed moves to break up the big banks after the 2008 global crisis.

I say ‘unsurprisingly’ because the whole mess was caused by the Democrat regime of Bill Clinton who got rid of the Glass-Steagall separation of commercial and investment banking. Small wonder that they are railing against its reinstatement.

Unfortunately they aren’t alone. Most Republicans also oppose effective moves against the banksters. A fact less shocking when you realize that in the last two election cycles, over 60 percent of the bankster’s donations went to Republicans. It seems America’s form of democracy is still more about what the money-men want (and are willing to pay for), rather than what the ordinary people want.

banksters demands

Most disappointing of all, however, has been President Obama. He swept to power promising ‘change’ but he never backed meaningful reforms against the banks. On the contrary, the Obama Administration has repeatedly put forward nominees with Wall Street connections for major oversight roles. It’s a bit like appointing some of the inmates of a prison as the prison guards!

During the debate over the Dodd-Frank Act, Obama’s henchmen even lobbied against an amendment offered by two of his own Democratic senators (Sherrod Brown of Ohio and Ted Kaufman of Delaware) who wanted to cap the size of the banks.

The fact is, that if Obama had taken a stronger position on the much needed financial reform it would have been much stronger and much more effective.

Now they are neither strong nor effective. They won’t work, in other words. It’s just been a bit of window dressing and bluff for the benefit of gullible voters.

gullible voters

And now even more money will be paid to Republicans since they routed the Democrats and swept to power in the US Senate, as well as expanding their majority control in the House of Representatives. That means even less will be done against the banksters.

It is a simple equation. Money buys politicians, buys power and influence.

Some people call it corruption.

Others try to tell us it is democracy.

I know which one I think it is!

In fact let’s use a new word….

Corruptocracy!

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America Has A Lot Of Things To Be Proud Of – This Is Not One Of Them.

“Fight Against Stupidity And Bureaucracy”

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One thing that America and Americans have always been noted for is their generosity to the less fortunate. Billions of dollars have been donated over the years to one good cause or another. It is a record to be proud of.

Now, however, it seems that the idiot bureaucrats are going to take even that away.

Now it is apparently a crime to feed the homeless.

Arnold Abbott

To emphasize the point, 90 year old Arnold Abbot, who has been preparing and distributing food to the homeless in Ft Lauderdale, Florida for more than two decades, is now deemed to be committing an illegal act and has been arrested for his charitable work.

It’s all because some morons, in government jobs, paid for by the taxpaying public, and who have never themselves been homeless, decided that feeding the poor is no longer to be tolerated.

Abbott and two South Florida ministers, pastors Dwayne Black and Mark Sims, have been arrested as they served up food. They were charged with breaking an ordinance restricting public feeding of the homeless. Each faces up to 60 days in jail and a $500 fine.

Arnold Abbott 2

Fort Lauderdale is the latest U.S. city to pass restrictions on feeding homeless people in public places. In Orlando, a similar ordinance requires groups to get a permit to feed 25 or more people in parks in a downtown district.

Advocates for the homeless say that the cities are fighting to control increasing homeless populations, but simply passing ordinances does not solve the problem, it just pushes it into someone else’s back yard.

It all smacks very much of bureaucratic stupidity. Leave the disease unchecked and concentrate on legislating for the symptoms.

If the government is willing to waste time and money making criminals out of those who wish to feed the homeless, why can it not use its resources to try to grips with the root causes of that homelessness and do something about it.

The US is $18 trillion in debt, and counting, but if government money can be found to give to foreign countries to alleviate hardship, why can money not be found to alleviate the same hardship in the homeland?

I’ve never been homeless and I don’t want to know what it’s like. But a lot of ordinary people hit hard times and lost their homes thanks to the theft and fraud perpetrated by the banksters whose greed created the property crash.

Many billions of dollars were given to these crooks by the government to bail them out,  money that was then gambled away or stuck in the banksters own pockets in the form of ‘bonuses’ they did not earn nor deserve.

Thankfully ordinary citizens are coming to the aid of Arnold Abbot. He has received public statements of support and even some financial contributions this Christmas past to assist with his helping the homeless.

I doubt, however, if the bureaucrats are finished with him, after all, who better for cowards like them to pick on than a 90 year old man?

I wonder who is right and who is wrong? Let’s check the real rule book…

Matthew 25:35,40

35 For I was hungry and you gave me food, I was thirsty and you gave me drink, a stranger and you welcomed me,

40 And the king will say to them in reply, ‘Amen, I say to you, whatever you did for one of these least brothers of mine, you did for me.’

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A Round Of Applause For Ms Fleischmann, I Think.

“Fight Against Stupidity And Bureaucracy”

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Alayne Fleischmann

Alayne Fleischmann was someone who I though did not exist.

Yes, it’s a slightly odd name, but that’s not what I mean.

She’s a real person, she does exist, although many on Wall Street and in the government wish she did not.

You see Alayne Fleischmann is a an honest lawyer.

Not only an honest lawyer, but an honest securities lawyer.

And not only an honest securities lawyer, but an honest securities lawyer who worked for a bank.

I know, it’s hard to believe isn’t it?

But it’s true.

Eight years ago Ms Fleischmann was employed by J P Morgan Chase Bank as a deal manager, a position that allowed her to see the crooked activity, fraud in other words, that was going on at the bank, particularly in regard to mortgage securities.

jp-morgan-chase-bank-logo1

She has been effectively ‘gagged’ for many years by confidentiality agreements, hordes of lawyers acting for the banks, and by government organizations that were supposedly investigating the fraud but which were in fact just trying to get it pushed under the carpet as soon and as quietly as possible.

Now Alayne Fleischmann is blowing the whistle, not just on the fraudulent activity of the banks but on the massive cover-up that followed it.

In doing so she is just confirming what anyone who has been paying attention already knew to be true, namely that the government has allowed the banks to buy their way out of criminal charges and jail time by paying multi-billion and multi-million dollar fines, fines that may sound large to you and I but which to them are a small fraction of the money they stole.

Financial Crisis Inquiry Commission report

The Department of Justice, Financial Crisis Inquiry Commission, SEC, and more have been pretending to investigate and bring the culprits to book. In effect they have done very little.

So I think a round of applause is in order for Ms Fleischmann. She won’t make much of a dent in the corrupt system, the corruption is so ingrained that I doubt if anyone could do that. But at least she came through with her honesty intact and that is a hell of a lot more than can be said of the banksters or the politicians and political appointees who were supposed to be going to make things right.

 

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