At Last A Little Good News About The Banksters.

“Fight Against Stupidity And Bureaucracy”

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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.

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.

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.

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!

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I Spy With Your Little ‘i’ – A Free And Open Internet?

“Fight Against Stupidity And Bureaucracy”

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When the internet was born it was a tool of the military establishment.

Then it broke out of that stranglehold and escaped into a world of freedom of expression and communication for everyone.

Never before had a system like this been available to the general public. Never before had it been so easy to find information, search for friends, communicate with groups with similar interests, etc. Its popularity was assured.

The world wide web developed at break neck speed, much too quick for the people who hate and detest freedom. They were confounded.

It was a free and open internet.

So how could it ever go wrong?

Well, as with the financial crisis, when you dig down a bit you find the Clinton administration again as the culprit.

During the 1990s, when the World Wide Web was first being woven into social and cultural life, internet companies and corporate advertisers lobbied the Clinton administration to minimize privacy restrictions, so that they could re-engineer the Web to enable commercial surveillance of internet users.

The warnings of public interest groups were ignored as social networks, search engines, service providers and advertisers lobbied hard against even the smallest of efforts at data protection. Motivated by greed, they ensured that commercial surveillance would be pervasively integrated online. They are still at it today, that’s really what cloud computing services are all about.

A few thousand giant corporations, like Google, have become able to capture information every minute, of every hour, of every day, from everyone who uses the internet. And they can’t stop because their profit strategies totally rely on accumulating user data.

Thus began the surveillance society. The government saw how easy this could now be done and began to catch up fast. If there was snooping to be done, they were not to be left out in the cold.

Until Edward Snowden, who had been a computer consultant working for a subcontractor to the US National Security Agency (NSA), copied several hundred thousand classified documents relating to surveillance programs being conducted by the US and its allies in the name of the war on terror, and sent them to journalists, nobody really understood the level of snooping that was going on.

Most of it was unnecessary, intrusive, unproductive and immoral, and after Snowden’s revelations nobody believed the United States government was totally innocent of any wrongdoing.

Further revelations published since have helped to reveal a surveillance system that intrudes into almost every facet of our private lives. Privacy in fact is a thing of the past, unless you have the time, resources and knowledge to try to circumvent it.

If the government was only spying on the communications of foreign countries such as China, Russia, North Korea and Iran, and if it was confined to what could be termed ‘unfriendly’ nations and their agents throughout the world, then I don’t think anyone would mind so much. It’s a necessary evil in today’s world.

But unfortunately it doesn’t stop there. Friendly nations and heads of state, European institutions, the UN headquarters, the International Atomic Energy Agency, to name but a few, have all also come under the snooper’s gaze.

This has not only shown up the irresponsibility and arrogance of those in charge of the snoopers, and their lack of common sense and ethics, but it has also created even more ill will against the United States.

German Chancellor Angela Merkel, an ally of the United States, was a victim of the snoopers. As a result of that revelation, the German government protested publicly its outrage. It also terminated its longstanding telecommunications service contract with Verizon, directing its business to Deutsche Telekom instead. Two weeks after that it expelled the head of US intelligence in Germany.

The President of Brazil, Dilma Rousseff, also took public stands against US privacy invasions. He, like Merkel, had also personally been a victim of the US snoopers.

Then the UN General Assembly voted unanimously to affirm online privacy as a human right, and in June 2014, responding to the EU, the US Justice Department had to promise to send legislation to Congress that would grant European citizens many of the (inadequate) privacy protections accorded to US citizens.

Bad enough not trusting your supposed ‘allies’, but US intelligence agencies have gone even further. Now they don’t even trust the decent, honest, hard-working citizens of America who have never broken any laws, nor have any intention of doing so.

The Prism program, for example, allows the NSA to collect data from your emails, telephone conversations, contacts, videos, etc., from major US digital companies including Facebook, Apple, Google, Microsoft and Yahoo.

The XKeyscore program uses several hundred servers distributed across the world to store information on the activities of every Internet user, including your emails, internet searches, the websites you visit, what you post on social networks, and blogs like this. (Whoops!)

The list goes on and on.

After Snowden’s revelations, commercial firms like Google, Facebook and others scrambled to distance themselves by professing outrage. Their protestations had little to do with political principle but a lot to do with ensuring they continued to make fortunes by collecting data on us.

The US Internet companies went on a public relations offensive, and also raced to reorganize their overseas operations, to reassure worried foreign customers that they were complying with local data protection measures.

IBM, for example, committed over a billion dollars to building additional data centers overseas, hoping to ease customer fears that their data was not safe from the US government’s surveillance. But then the US authorities demanded that Microsoft, which deploys more than a million computers in over 40 countries, hand over emails stored on its servers in Ireland. Data is not safe and private anywhere it seems.

Last week I wrote a post about the Facebook/US Army experiment in trying (successfully) influence how people thought. (Click here if you want to read it.)

And so it continues.

Personally I think it is a pity that the powers that be are able to devote time, energy and money against people who have done nothing wrong, yet seem unwilling to remove child pornography and other evils from the world wide web. But the latter would require a decree of decency and morals that is sadly lacking in those who direct such matters for the government.

The US has lost the moral authority to talk about a free and open Internet, because that free and open internet has already been destroyed.

No doubt there is worse to come.

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“No Credit. Bad Credit. All Credit. 100 Percent Approval.”

“Fight Against Stupidity And Bureaucracy”

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We had it with the real estate market. Billions of dollars being lent to people who obviously couldn’t afford it.

We saw the trouble, hardship, misery and financial woes that were caused as credit dried up, real estate prices began to tumble, and bankruptcies and foreclosures increased.

And we know the damage it did to the economy when irresponsible banks and other lenders went bust and almost brought down the entire financial system. 

Smart people would learn from such a situation.

Smart people would never contemplate doing such a thing again.

But despite what they would like to have you believe, bankers are not smart people. They’re dumb and they are greedy, a deadly combination.

As a result of the financial crisis millions of Americans (and people in other countries too) have been left with poor credit scores. Yet remarkably they are now able to easily obtain auto loans from used-car dealers, including some who fabricate or ignore borrowers’ abilities to repay. Even if you are bankrupt or living only on social security, banks like Wells Fargo will lend you thousands of dollars to buy a used car.

It’s called the new sub-prime boom, because the lack of caution resembles the frenzied sub-prime mortgage market before its collapse. And it is already bringing misery to many people who have been suckered into taking out loans that they clearly could not afford.

Worse than that, these sub-prime auto loans often come with terms that take advantage of the most desperate, least financially sophisticated customers, with interest rates that can exceed 20 percent. And many of the loans can be at least twice the value of the second hand cars they are being used to purchase!

This creates a vicious circle for some borrowers, who still owe money on a car that they are trading in when they purchase another one, meaning that the former debt is rolled over into the new loan and they end up, not just paying too much for their current car, but also continue to pay off the loan on their previous car that they don’t even have!

This is the way loan sharks operate. Eventually you end up borrowing your own money and paying them interest for the privilege!

This surge in sub-prime auto lending is being driven by some of the same dynamics that were at work in sub-prime mortgages. There is a veritable deluge of money pouring into sub-prime autos, as the high rates and steady profits of the loans attract investors.

And just as Wall Street stoked the boom in mortgages, some of the nation’s biggest banks and private equity firms are now feeding the growth in sub-prime auto loans by investing in lenders and making money available for loans.

To quote some of the figures, auto loans to people with bad credit have risen more than 130 percent in the five years since the immediate aftermath of the financial crisis, with roughly one in four new auto loans last year going to borrowers considered sub-prime, that is, people with credit scores at or below 640. Wells Fargo, mentioned earlier, made $7.8 billion in auto loans in the second quarter of this year, up 9 percent from a year earlier, and has at least $50 billion in auto loans on its books.

Even worse, as was the case with sub-prime mortgages before the financial crisis, many sub-prime auto loans are being bundled up into complex bonds and sold as securities by banks to insurance companies, mutual funds and public pension funds. They are all scrambling for these, which in turn creates ever-greater demand for loans, and leads to the banks issuing more and more sub-prime credit.

Unbelievably it’s the same crooks doing exactly the same thing, including using incorrect information about borrowers’ income and employment, so that people who had lost their jobs, or were bankrupt, or living on Social Security, could qualify for loans that they could never afford.

Admittedly, the size of the sub-prime auto loan market is only a tiny fraction of the sub-prime mortgage market at its peak, and its implosion would not have the same far-reaching consequences.

For the banks the investors silly enough to buy their bonds, that is.

But the misery is just as great for the people who are suckered into accepting credit they cannot afford.

Illegal it may not be, but immoral it certainly is.

Political leaders who sit astride high horses and purport to be working on behalf of the ordinary people should be doing something about it.

But, as I’ve said before, don’t hold your breath!

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