The English High Court ruled earlier this month that the virtual and self-proclaimed “interim president” (Washington’s puppet) Juan Guaido and not the Venezuelan state should administer the 31 tonnes of gold reserves stored in the UK (1). This debacle proves that national and international law are no longer worth a dime, and represents a contemporary act of stale piracy by ancient Albion (2). The trial in England for Venezuela's blocked assets began in London on June 22 and concerned US $1.3 billion of state property. For decades, successive governments, even before Chavez, used the country’s gold bars in the Bank of England's underground vaults in international financial transactions. Twenty percent of the world's gold is kept in these vaults, in what is a legacy to colonial-time dynamics.
Banking and Finance
You’d struggle to find anyone who believes our current banking sector was the ideal one for producing and maintaining a strong and just economy. The 2008 crisis showed how unstable, and vital to the wider economy, the sector is. The fact is, credit is both necessary and central to the global economy. Economists like Lazzarato have come up with theories about how debt drives economic production and an ever-increasing economy and in an era where finance has come to dominate our economy, it is evident to everyone that banks are very powerful institutions and if they could be reformed could be the power behind substantial improvement in our economy. Democratisation of our banking sector, via co-operatives and credit unions, is something that merits serious thought.
BlackRock has been called “the most powerful institution in the financial system,” “the most powerful company in the world” and the “secret power.” It is the world’s largest asset manager and “shadow bank,” larger than the world’s largest bank (which is in China), with over $7 trillion in assets under direct management and another $20 trillion managed through its Aladdin risk-monitoring software. BlackRock has also been called “the fourth branch of government” and “almost a shadow government”, but no part of it actually belongs to the government. Despite its size and global power, BlackRock is not even regulated as a “Systemically Important Financial Institution” under the Dodd-Frank Act, thanks to pressure from its CEO Larry Fink, who has long had “cozy” relationships with government officials.
As marginalized families without bank accounts struggle to get stimulus checks, it's time to fix the rusty pipes of our inequitable financial system. The COVID-19 pandemic response has shown that the very foundations of our economy are shaky, fragile, and — for some of us — downright dangerous. We’re once again watching working people, especially working people of color, bear the brunt of the fallout. Meanwhile, big companies traded on the stock market took two-thirds of the money meant to bail out small businesses.
It has been a hundred years since the first and only public bank was created in the United States, in North Dakota, but now there is renewed interest in starting more public banks. California passed a law last year allowing public banks. New Jersey and New York are not far behind. To explain why public banks are necessary and describe the growing movement for them, we speak with Ellen Brown of the Public Banking Institute. She discusses the benefits of public banks, how they save money and free up funds for necessary public projects and what the obstacles are. Brown also writes about financial issues. She talks about the current crisis in the repo market that is brewing in the United States and how it makes the economy precarious.
Two actions by US financial authorities this week indicate that the United States will respond to a looming downturn in the global economy by providing, once again, unlimited amounts of cash to financial markets. On Wednesday, the Federal Reserve began an operation, lasting at least six months, to purchase around $60 billion of Treasury bills a month in response to sharp spikes in interest rates in overnight markets. The following day, in a separate action, the New York Federal Reserve injected $104.15 billion into financial markets to boost liquidity.
Payments can happen cheaply and easily without banks or credit card companies, as has already been demonstrated—not in the United States but in China. Unlike in the U.S., where numerous firms feast on fees from handling and processing payments, in China most money flows through mobile phones nearly for free. In 2018 these cashless payments totaled a whopping $41.5 trillion; and 90% were through Alipay and WeChat Pay, a pair of digital ecosystems that blend social media, commerce and banking. According to a 2018 article in Bloomberg titled “Why China’s Payment Apps Give U.S. Bankers Nightmares”
Black Business Review’s Marilyn Kai Jewett writes favorably of Pennsylvania’s public bank movement at both the state and municipal levels. A strong municipal public bank coalition has also developed in Pittsburgh, similar to Philadelphia's Neighborhood Networks; and Mike Krauss, chair of the state level Pennsylvania Public Bank Project, reports that efforts are underway to introduce legislation in the PA General Assembly for a state public bank modeled on the Bank of North Dakota. Kai writes in the local Philly paper Scoop USA that public banking is a “good idea.” Since 2014, Philadelphia Neighborhood Networks, founded by Stan Shapiro, has been leading the Philly movement for a public bank.
In the aftermath of the greatest financial calamity since the Great Depression, then–chief of staff for the Obama administration Rahm Emanuel made the call for aggressive action to prevent a recurrence of the meltdown of 2008. Although the U.S. government’s system of checks and balances typically produces incremental reform, Emanuel suggested that during times of financial upheaval, the traditional levers of powers are often scrambled, thereby creating unique conditions whereby legislators could be pushed in the direction of more radical reform.
Global investors managing $32 trillion issued a stark warning to governments at the UN climate summit on Monday, demanding urgent cuts in carbon emissions and the phasing out of all coal burning. Without these, the world faces a financial crash several times worse than the 2008 crisis, they said.
It’s time to ask an uncomfortable question: What exactly is the U.S. getting out of its partnership with Saudi Arabia? The answer is: nothing but headaches, human rights abuses and national embarrassment. In the cynical past, the U.S. could at least argue that it needed Saudi oil, but that’s no longer the case, due to the shale-oil boom (though that fact is not necessarily good for an ever-warming planet). Recently, the crimes of the Saudi government managed to pierce the Trump-all-the-time-Kanye-West-sometimes media-entertainment complex due to Riyadh’s likely murder of dissident journalist Jamal Khashoggi. That the U.S.-Saudi relationship is, however briefly, coming under the proverbial microscope is a good thing.
Occupy The SEC Submits Letter To Financial Regulators On The Proposed Weakening Of Volcker Rule Regulations
The Volcker Rule was passed as part of the Dodd Frank Act of 2010 in order to help avert another financial crisis similar to the Great Recession of 2008. That crisis was caused in large part by excessive bank speculation in trading markets, and the Volcker Rule seeks to reduce the risk associated with these activities by prohibiting proprietary trading by government-backstopped banks. In October 2011, the Agencies proposed regulations implementing the Volcker Rule. In February 2012, OSEC issued a 325 page comment letter to the banking regulators urging vigorous and robust implementation of the Volcker Rule. OSEC also issued letters to members of Congress in the summer of 2012 during the government’s investigation into JP Morgan’s “London Whale” $6 billion trading loss...
The key issue to emerge from the semiannual meeting of the International Monetary Fund (IMF) held in Bali, Indonesia last week is that 10 years out from the 2008 global financial crisis the conditions have been created for another economic and financial disaster. And those in charge of the global economy have no means of preventing it, not least because the very policies they have carried out over the past decade have helped prepare it. It was somewhat symbolic that the meeting took place in the immediate aftermath of the devastating earthquake and tsunami on the Indonesian island of Sulawesi, which again underscored the extent to which the record growth of social inequality, accelerating after 2008...
In recent months, the Trump administration has launched an unprecedented assault on the immigrant community, highlighted by a “zero tolerance” policy that has left as many as 500 children separated from their parents. But it’s not just the federal government that’s persecuting this vulnerable group. As the Miami Herald reports, Bank of America is freezing the account of customers whose U.S. citizenship it deems suspect.