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The Chinese ‘Debt Trap’ Is A Myth

China, we are told, inveigles poorer countries into taking out loan after loan to build expensive infrastructure that they can’t afford and that will yield few benefits, all with the end goal of Beijing eventually taking control of these assets from its struggling borrowers. As states around the world pile on debt to combat the coronavirus pandemic and bolster flagging economies, fears of such possible seizures have only amplified. Seen this way, China’s internationalization—as laid out in programs such as the Belt and Road Initiative—is not simply a pursuit of geopolitical influence but also, in some tellings, a weapon.

Farm Loan Delinquencies Surge In U.S. Election Battleground Wisconsin

WASHINGTON/CHICAGO (Reuters) - Farm loan delinquencies rose to a record high in June at Wisconsin’s community banks, data showed on Thursday, a sign President Donald Trump’s trade conflicts with China and other countries are hitting farmers hard in a state that could be crucial for his chances of re-election in 2020. The share of farm loans that are long past-due rose to 2.9% at community banks in Wisconsin as of June 30, the highest rate in comparable records that go back to 2001, according to a Reuters analysis of loan delinquency data published by the Federal Deposit Insurance Corporation.

Argentina’s New $50 Billion IMF Loan Is Designed To Replay Its 2001 Crisis

For several months now. Argentines have been taking to the streets to protest against neoliberal austerity measures of President Mauricio Macri. The most recent such protest took place on July 9 on Argentine’s Independence Day. There has also been three general strikes thus far. In the two years since he took office, President Macri has laid off as many as 76,000 public sector workers, and slashed gas and water and electricity subsidies, leading to a tenfold increase in prices, in some cases. Now, the government argues that all of this is necessary in order to stem inflation, and the decline of the currency’s value. Last month, Macri received the backing of the International Monetary Fund. The IMF agreed to provide Argentina with a $50 billion loan, one of the largest in IMF history. In exchange, the Macri government will deepen the austerity measures already in place.

US Bank Declares End To Oil And Gas Pipeline Loans

For months, the bank had been under fire for financing the Dakota Access pipeline by providing over a quarter billion dollars worth of funding to its builder, Energy Transfer Partners (ETP). Environmentalists famously dropped a banner calling on U.S. Bank to divest from DAPL at the New Years 2017 Minnesota Vikings and Chicago Bears football game. The language of the bank's new policy seemed blunt. “The company does not provide project financing for the construction of oil or natural gas pipelines,” U.S. Bancorp, parent company of U.S. Bank, wrote in its April 2017 Environmental Responsibility Policy. Divestment advocates cheered. “We applaud this progressive decision from U.S. Bank,” an Honor the Earth representative said in a statement, as the bank's new policy made headlines.

How California Can Save $10 Billion On A $9 Billion Loan

By Ellen Brown for The Web of Debt Blog - School districts are notoriously short of funding -- so short that some California districts have succumbed to Capital Appreciation Bonds that will cost taxpayers as much as 10 to 15 times the principal by the time they are paid off. By comparison, California's Prop. 51, the school bond proposal currently on the ballot, looks like a good deal. It would allow the state to borrow an additional $9 billion for educational purposes by selling general obligation bonds to investors at an assumed interest rate of 5%...

How The Payday Loan Industry Is Obstructing Reform

By Michael J. Sainato for Counter Punch - In June 2016, the Consumer Financial Protection Bureau proposed new guidelines to protect consumers from payday loan traps. These traps help perpetuate the cycle of poverty and prey on individuals in low income communities who are unable to obtain loans from a bank. The multi-billion-dollar payday lending industry has garnered influence with both Republicans and Democrats in order to inoculate itself from legislations and reforms that could potentially hurt its profits.

Colleges Flush With Cash Saddle Poorest Students With Debt

By Annie Waldman and Sisi Wei in ProPublica - A ProPublica analysis based on new data from the U.S. Department of Education shows that students from low-income families graduate from NYU saddled with huge federal loans. The school’s Pell Grant recipients – students from families that make less than $30,000 a year – owe an average of $23,250 in federal loans after graduation. That’s more federal loan debt than low-income students take on at for-profit giant University of Phoenix, though NYU graduates have higher earnings and default less on their debt. NYU is not the only university with a billion-dollar endowment to leave its poorest students with heavy debt loads. More than a quarter of the nation’s 60 wealthiest universities leave their low-income students owing an average of more than $20,000 in federal loans.

Obama To Reward Loan Company Accused Of Cheating Troops

The Obama administration plans to reward Navient Corp, the student loan specialist formerly owned by Sallie Mae, with new business some three months after federal prosecutors accused the company of intentionally cheating troops on their federal student loans, according to three sources familiar with the administration's plans. The move is likely to stoke comparisons to recent multi-billion-dollar settlements reached between big banks and federal authorities over financial crisis-era misdeeds. Banks agreed to pay sizable sums, but public interest groups have criticized the settlements because the banks suffered few business consequences and their executives escaped criminal and civil charges. "It's very disappointing," said Jason Collette, national organizer for Alliance For A Just Society, a network of state-based advocacy groups. "Until a company loses its federal contracts or a senior executive is punished, these fines are just the cost of doing business." In May, Navient and its former parent, Sallie Mae, agreed to pay a combined $139 million to resolve Department of Justice allegations that the two companies had swindled up to 60,000 service members out of tens of millions of dollars and forced other borrowers to pay unfair fees on their student loans. At a news conference announcing the settlement, Education Secretary Arne Duncan said he had instructed his staff to immediately conduct a review to determine "what appropriate actions, if any," should be taken against Navient in response to the allegations.
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