Local Governments, Churches, Community Groups, Prominent Business Men And Others Are Divesting From Big, utterly Corrupt Banks … Why Aren’t You?
protecteurs coloniaux; aujourd'hui l'Europe,
avec son Fonds de stabilité financière (FESF)
alimenté en yuans; demain les Etats-Unis, au
bord de la faillite et menacés d'une situation
à l'Argentine... un scénario catastrophe pour
l'Occident, à la veille d'une domination sans
partage de la Chine?
La poursuite de la mondialisation sauvage voulue
par l'Occident lui aura finalement apporté la
catastrophe qu'il aura méritée, construite par
son égoïsme, son arrogance, sa suffisance et sa
courte vue: il s'est fait battre à son propre jeu.
À moins bien entendu que les anciens adversaires
ne se réfugient au plus vite dans un nouveau
paradigme de la gouvernance mondiale, une vision
multipolaire équilibrée prônée par la Russie au
sein de l'alliance BRICS élargie...
CNN Money reports:
Customers are dumping their banks in droves ahead of the nationwide “Move Your Money” and “Bank Transfer Day” movements this Saturday.
***
At least 650,000 consumers have already joined credit unions since Sept. 29 … to a nationwide survey of credit unions by the Credit Union National Association. [Here's the report.] That amounts to $4.5 billion in new savings accounts, CUNA said.
***
Meanwhile, the Independent Community Bankers of America said a poll of its 5,000 members conducted on Oct. 17 found that nearly 60% of community banks are gaining customers who are sick and tired of the big financial institutions. The association’s community bank locator has seen more than 5,000 inquiries in the last few weeks — an increase of nearly 500%.
By the end of this weekend, accounts at these credit unions and community banks could grow by tens of thousands more.
***
“They take your deposits and use them to buy politicians to de-regulate, give them immunity, interest-free loans and bailouts. Then they turn around and charge you fees to make them even richer,” said one “Move Your Money” flyer posted on a Facebook page dedicated to the initiative (which has 43,679 “likes”). “Take your money to a credit union or a community bank that will use your money in your community and not to pervert the rule of law and fill their own pockets.”
Occupy Wall Street has formed a separate united front, called “Dump Your Bank Day,” which will take place on Tuesday, Nov. 8.
I’ve supported the Move Your Money campaign for years because:
1. The only way to save the economy is to break up the giant, insolvent banks
2. The bought-and-paid-for politicians refuse to do so (because … drumroll, please … they’re bought and paid for by the big banks)
3. So we’ll have to do it ourselves
No wonder churches, local governments, community groups, prominent business men and others are divesting from the big corrupt banks.
You can use Move Your Money project’s community bank and credit union finder tool to find out how and where to move your money.
Postscript: Ending the Fed and reining in Wall Street are two sides of the same coin. While even top-drawer economists say we must end the Fed, and many libertarians argue that ending the Fed would “change everything”, the Fed is the big banks and the giant banks are the Fed.
It will be impossible to pressure Congress to end the Fed as long as the giant banks have purchased Congress lock, stock and barrel. The dinosaur banks will pressure their water-carriers in Congress to not only keep the Fed alive, but to give it more and more powers.
So all those who want to end the Fed should also support the Move Your Money movement and divest their funds from the giant banks, because only then will it be possible to end the take away the Fed’s main supporters: the giant banks.
Indeed, the big banks are not engaging in capitalism … rather, they are engaging in socialism, fascism, looting, kleptocracy, oligarchy or banana republic behavior (depending on your preference of wording).
On the other hand, smaller banks are engaging in capitalism – and are actually allocating capital to entrepreneurs (what banks are supposed to do).
If we downsize the giant, socialist banks, the small banks will thrive, thus reinvigorating the entire economy … saving capitalism in the process.
As Charles Hugh Smith noted recently:
There are only three things–and only these three–that will cripple Wall Street’s democracy-killing concentration of wealth and power:
1. Transfer the 99%’s money out of Wall Street and the Too Big To Fail Banks
2. Remove campaign contributions from our democracy in a way that the corporate legalist lackeys in the Supreme Court cannot overturn, i.e. entirely publicly financed elections
3. Abolish Wall Street’s dealer, pusher and protector, the Federal Reserve.
My reasoning is very simple:
Everything else people want to see happen cannot happen if:
1) Wall Street and the SDI (systemically dangerous institutions) a.k.a. too big to fail banks, control most Americans’ financial assets and debts
2) The Federal Reserve exists to enable and protect the SDI’s wealth and power via Primary Dealers, the discount window and other pusher/dealer mechanisms
3) Wall Street and the other SDIs can use the billions of dollars they skim from our accounts, IRAs, 401Ks and pensions to buy political influence and protection from regulation and competition.
Therefore these are the necessary foundations of any real change.
As long as Wall Street and the other SDIs control much of the nation’s financial markets, assets and debts, and the Federal Reserve exists to protect and enable their predation and parasitic skimming, they will have the means to reap billions in profits which can then be funneled into our cash-corrupted political system of for-sale toadies and apparatchiks.
If we don’t end the Fed, it will keep propping up the Wall Street con artists.
If we don’t downsize the giant banks, they will keep propping up the Fed.
Get it?
Police Lacerate Army Ranger’s Spleen and Cause Internal Bleeding … Then Deny Him Medical Treatment for 18 Hours....
Reuters notes:
A former U.S. Army Ranger and Occupy Oakland protester was in intensive care on Friday after a veterans group said he was beaten by police during clashes with demonstrators this week.
The veteran, identified as Kayvan Sabeghi, was the second former American serviceman during the past two weeks to be badly hurt in confrontations between anti-Wall Street protesters and police in Oakland.
The group Iraq Veterans Against the War said Sabeghi was detained during disturbances that erupted late on Wednesday in downtown Oakland and was charged with resisting arrest and remaining present at the place of a riot.
Highland General Hospital confirmed that Sabeghi was a patient in the intensive care unit there.
Brian Kelly, who co-owns a brew pub with Sabeghi, said his business partner served as an Army Ranger in Iraq and Afghanistan. He said Sabeghi told him he was arrested and beaten by a group of policemen as he was leaving the protest to go home.
“He told me he was in the hospital with a lacerated spleen and that the cops had jumped him,” Kelly said. “They put him in jail, and he told them he was injured, and they denied him medical treatment for about 18 hours.”
The Guardian reports:
Kayvan Sabehgi, who served in Iraq and Afghanistan, is in intensive care with a lacerated spleen. He says he was beaten by police close to the Occupy Oakland camp, but despite suffering agonising pain, did not reach hospital until 18 hours later.
***
Sabehgi told the Guardian from hospital he was walking alone along 14th Street in central Oakland – away from the main area of clashes – when he was injured.
“There was a group of police in front of me,” he told the Guardian from his hospital bed. “They told me to move, but I was like: ‘Move to where?’ There was nowhere to move.
“Then they lined up in front of me. I was talking to one of them, saying ‘Why are you doing this?’ when one moved forward and hit me in my arm and legs and back with his baton. Then three or four cops tackled me and arrested me.”
Sabeghi … said he was handcuffed and placed in a police van for three hours before being taken to jail. By the time he got there he was in “unbelievable pain”.
***
Sabehgi was due to undergo surgery on Friday afternoon to repair his spleen, which would involve using a clot or patch to prevent internal bleeding.
***
Some protesters had set fire to a hastily assembled barrier at the corner of 16th Street and Telegraph, in a bid to prevent access to the occupied building, but police drove demonstrators away from 16th Street using tear gas, flashbang grenades, and non-lethal rounds.
Sabehgi said he had not been in the occupied building, and was walking away from the main area of trouble when he was injured.
He said he had his arms folded and was “totally peaceful” before being arrested.
Local San Francisco ABC affiliate KOFY News interviewed Sabehgi’s sister tonight, who said that Sabehgi lived near Frank Ogawa Plaza (the center of the Occupy protests), and was walking home Wednesday night away from violence when police stopped him. Sabehgi said that police ordered him to walk in another direction, and he simply asked “why?”
In response, according to Sabehgi’s sister, the police beat him mercilessly with batons.
Sabehgi was then kept in a holding cell for 18 hours. Despite begging to see a doctor, Sabehgi was refused medical assistance. Instead, according to Sabehgi, his jailors accused Sabehgi without any cause of being a heroin addict and alcoholic and – instead of providing medical help for his severe injuries – told him to stop taking heroin.
There is apparently a videotape of the incident (KOFY noted that “police are reviewing video of the incident”).
Given the outcry over the unprovoked injury of Marine veteran Scott Olsen – which has caused veterans from all over the country to come out to support the protesters – Sabehgi’s treatment by the police could generate even more support for the protests....
If we don’t downsize the giant banks, they will keep propping up the Fed....
Believe in Free Market Capitalism? Then Move Your Money!
Conservative free market entrepreneurial capitalist Karl Denninger notes:
If you have an account at a BANK, go move it to a CREDIT UNION.
You know, a place that you own and is a mutual association of people?
Yes. One that you own. Where the fees assessed go to provide services to…. you, not to feather the nests of bank executives and stockholders.
Denninger is right.
As HowStuffWorks points out:
Banks are for-profit companies. They make money by charging intereston loans, collecting account fees and reinvesting all that money to earn more profit. But as for-profit companies, they also pay state and federal taxes.
Credit unions, on the other hand, are not-for-profit institutions. Technically, credit unions are owned by their account holders, known as members. Any profit earned by a credit union is either invested back into the organization or paid out to members as a dividend [source: Federal Reserve]. As a not-for-profit institution, credit unions pay no state or federal taxes, meaning they can charge lower interest rates than banks for most financial services.
Real free market, capitalist entrepreneurs want to own and control our own capital. With credit unions, we do so.
Moreover, the big banks no longer do very much traditional banking. Most of their business is from financial speculation. For example, less than 10% of Bank of America’s assets come from traditional banking deposits. Instead, they are mainly engaged in financial speculation and derivatives.
Credit unions and small banks, on the other hand, are mainly engaged in traditional banking functions like storing deposits and making loans to Main Street.
As noted :
1. The only way to save the economy is to break up the giant, insolvent banks
2. The bought-and-paid-for politicians refuse to do so (because … drumroll, please … they’re bought and paid for by the big banks)
3. So we’ll have to do it ourselves
No wonder churches, local governments, community groups, prominent business men and others are divesting from the big corrupt banks.
***
The big banks are not engaging in capitalism … rather, they are engaging in socialism, fascism, looting, kleptocracy, oligarchy or banana republic behavior (depending on your preference of wording).
On the other hand, smaller banks are engaging in capitalism – and are actually allocating capital to entrepreneurs (what banks are supposed to do).
If we downsize the giant, socialist banks, the small banks will thrive, thus reinvigorating the entire economy … saving capitalism in the process.
Real capitalists will move our money away from the giant, socialist banks and to credit unions … where we own and control our capital.
And where our hard-earned money works for us, instead of being gambled and thrown away in the global casino.
Dislike the Fed? Then Move Your Money!
Conservatives and libertarians dislike the Fed, because it warps the free market.
People who dislike the Fed should move their money out of the giant banks, as that is one of the most effective ways to undermine the Fed’s power.
Specifically, ending the Fed and reining in Wall Street are two sides of the same coin. While even top-drawer economists say we must end the Fed, and many libertarians argue that ending the Fed would “change everything”, the Fed is the big banks and the giant banks are the Fed.
It will be impossible to pressure Congress to end the Fed as long as the giant banks have purchased Congress lock, stock and barrel. The dinosaur banks will pressure their water-carriers in Congress to not only keep the Fed alive, but to give it more and more powers.
So all those who want to end the Fed should also support the Move Your Money movement and divest their funds from the giant banks, because only then will it be possible to end the take away the Fed’s main supporters: the giant banks.
As Charles Hugh Smith noted recently:
There are only three things–and only these three–that will cripple Wall Street’s democracy-killing concentration of wealth and power:
1. Transfer the 99%’s money out of Wall Street and the Too Big To Fail Banks
2. Remove campaign contributions from our democracy in a way that the corporate legalist lackeys in the Supreme Court cannot overturn, i.e. entirely publicly financed elections
3. Abolish Wall Street’s dealer, pusher and protector, the Federal Reserve.
My reasoning is very simple:
Everything else people want to see happen cannot happen if:
1) Wall Street and the SDI (systemically dangerous institutions) a.k.a. too big to fail banks, control most Americans’ financial assets and debts
2) The Federal Reserve exists to enable and protect the SDI’s wealth and power via Primary Dealers, the discount window and other pusher/dealer mechanisms
3) Wall Street and the other SDIs can use the billions of dollars they skim from our accounts, IRAs, 401Ks and pensions to buy political influence and protection from regulation and competition.
Therefore these are the necessary foundations of any real change.
As long as Wall Street and the other SDIs control much of the nation’s financial markets, assets and debts, and the Federal Reserve exists to protect and enable their predation and parasitic skimming, they will have the means to reap billions in profits which can then be funneled into our cash-corrupted political system of for-sale toadies and apparatchiks.
If we don’t end the Fed, it will keep propping up the Wall Street con artists....
I was recently challenged by a contributor to write something positive, and so I decided to write about the single most positive outcome of the current financial crisis in Europe: the complete collapse of the corrupt, predatory, pathological global banking sector and its dealers, the central banks. Exploring why this is so reveals the insurmountable internal conflicts in our current financial system, and also illuminates the systemic political propaganda which is deployed daily to prop up a parasitic, corrupting, pathologically destructive financial system.
Our first stop is modern finance itself. Modern financial "products" and "instruments" are often highly complex and abstract, but the entire edifice can be distilled down to this: the system is based on the assumption that all risk can be hedged, and the difference between the initial position's yield/gain (i..e. placement of capital at risk for a gain) and the cost of hedging the risk of the wager to zero can be skimmed from the system risk-free.
That is the entire system in a nutshell, and we can immediately see the advantages of this system over traditional Capitalism, where risk can be hedged but never to zero, and the return is correlated to the risk taken on.
In modern finance, high-risk "investments" (wagers) with high returns can be taken on without worry because any and all risk can be hedged to zero, even in super high-risk wagers.
And since even high-risk positions can be seamlessly hedged to zero, then there is no reason not to borrow money to increase the size of your wagers: since you can't lose, then why not? Wagering in risk-free skimming with borrowed or leveraged money is simply rational.
Put these together and we see how a system based on risk-free skimming eventually leverages itself to the point that the slightest disruption can bring down the entire over-leveraged, over-extended system.
Why is this so? Every hedge has a counterparty who is supposed to pay off if the initial wager blows up. A system based on risk-free hedging is ultimately a self-organizing system which maximizes return by increasing bet sizes, leveraging/borrowing to near infinity and hedging every hedge as well as every wager.
This creates long chains of hedges and counterparties. Here's an example based on an asset we all understand, a house. Let's say someone buys a house for $1,000 down, something that was common in the housing bubble. That $1,000 is leveraged up to buy a $200,000 house via a $200,000 mortgage.
The "owner" of the house then buys a hedge to protect himself from the house losing value, so the risk is reduced to zero: if the value rises, the owner reaps the gain and if it declines, then he collects the payoff of the hedge from the counterparty, for example, a Wall Street investment firm.
The counterparty calculated the risk of real estate declining and then priced the hedge accordingly. There is some small risk that the loss will exceed the cost of the hedge, so the issuer of that hedge bundles similar bets and then buys a hedge or "insurance" from another player, who makes the same calculations of risk and return.
Meanwhile, the mortgage has been tranched (sliced into principal and interest and into various pools of risk) and bundled with other "low-risk" mortgages and sold to investors, who also buy a hedge against any loss in the tranch, for example, a credit default swap (CDS) which pays out if a borrower defaults. Those hedges are sold or "insured" with another hedges.
All of this debt and all of these hedges are based on a mere $1,000 of actual capital. The players who originated each hedge are similarly leveraged, because since risk can be lowered to zero, who needs capital?
So what happens when one counterparty (issuer of a hedge) somewhere in the chain runs into trouble? The entire chain collapses. With razor-thin capital to cover any losses, then each link in the chain dissolves into insolvency if their counterparty fails to pay off.
This is how we get hundreds of trillions of dollars in "notational" derivatives: every hedged is hedged with another "instrument," "products" are bundled and insured, and so on. The system is based on the principle that risk can be reduced to zero, and so there is no need for capital.
Unfortunately, that premise is demonstrably false. Benoit Mandelbrot dismantled the notion that risk can be reduced to zero in his prescient masterpiece, The (Mis)behavior of Markets. The founder of fractal geometry showed that markets are fractal in nature, and are thus intrinsically prone to unpredictable disruptions. Simply put, risk cannot be massaged away.
Thus the fundamental premise of all modern finance is flat-out wrong, and this explains why systemic risk, rather than being eliminated, actually rises with every ratchet up in debt, leverage and counterparty hedging.
The entire global financial system is thus based on the equivalent of a perpetual motion machine: money can be borrowed or leveraged into existence in essentially unlimited quantities, and then deployed in risk-free skimming operations to harvest unlimited wealth.
What does this promise of using leveraged capital to skim risk-free fortunes do to the "real economy" of production and investment in plant and technology? It guts it. The risk of industrial Capitalism is real and cannot be hedged away; high-risk investments may blow up or they may return high yields. It literally makes no sense to risk real capital in productive Capitalism when a zero-risk skimming operation can be developed that essentially needs near-zero capital.
Thus financial capital has come to completely dominate industrial or productive capital. The pernicious consequences of this dominance have poisoned the economy and culture on multiple levels.
In the political sphere, the aggregation of hundreds of billions of dollars in skimmed profits gave Wall Street and the banking sector unlimited budgets to buy political influence. This created a monstrously pathological feedback loop: the more political influence Wall Street bought, the higher their returns on financialization skimming.
Consider housing as an example. Housing was once a simple, barely profitable long-term investment for both the buyer, who had to place substantial capital at risk (20% down payment) and the holders of mortgages, who took a modest yield for 30 years in trade for low risk.
Wall Street and the banks financialized housing via political influence. opening up a vast new territory to be exploited via skimming. Since capital wasn't necessary in no-risk skimming, then down payments were dispensed with to increase the pool of debtors, as they are the foundation of all skimming operations.
the cost of servicing that debt was manipulated via "teaser rates" and "interest only" loans, further leveraging up American home buyers' modest income streams. Mortgages were bundled, tranched and hedged, and the mortgage-backed securities (MBS) and collateralized debt obligations (CDOs) were sold to trusting investors aroudn the world.
It was a bonanza of unprecedented wealth creation from financial skimming. $1,000 down and a few hundred dollars a month for a "teaser rate" interest-only loan was leveraged into a global chain of "products" and counterparties that could be skimmed all along the chain.
That deepened the political corruption that fed the skimming operation, and introduced the "no risk" pathology into Mainstream America. Since real estate never went down in value, then buying a second, third or fourth home on leverage was simply rational; in a Federal Reserve-controlled world of near-zero yields on cash, it was irrational not to.
But there were two intrinsic flaws in the skimming operation: while the Wall Street players were hedged (or so they reckoned), the average Americans buying homes with near-infinite leverage were not hedged. That meant that when their razor-thin capital went to zero, they were insolvent. Once they defaulted, then the income stream feeding the chain of skimming went away and the chain collapsed.
Once one counterparty failed in the chain, the entire chain collapsed as well. As Mandelbroit explained, such disruptions were an intrinsic feature of the system; though the timing of a systemic disruption could not be predicted, the fact that disruptions would occur on a regular basis could be predicted.
Some players knew this, of course, but that led to another pathology: those investment players who avoided the "no risk" skimming casino could not generate the yields being "earned" by the leveraged skimmers with legitimate investing, and so their investors abandoned them for the fully rational reason that "no risk" yields were higher elsewhere.
This too created a feedback loop, where the capital available to be leveraged grew rapidly, while the pool of capital available for "patient" risky investments in actual productive assets declined. Capital available for productive investment thus became costly and scarce, while capital available for leveraged skimming became cheap and abundant.
The Federal Reserve bankrolled the skimming to the hilt. Indeed, the entire pathology of low-interest, unlimited leverage skimming was based on the Federal Reserve's manipulation and intervention. That remains true today.
What happens when the whole chain blows up and the foundation of debt is impaired? Since the whole system is based on the debt and the income streams devoted to servicing it, the entire edifice collapses when the debt is impaired--debtors default and the system clogs with bad debt, i.e. uncollectable debt.
In a transparent Capitalist system, the debt would be written down and all the insolvent borrowers, lenders and counterparties would be wiped out. But the political corruption that enabled modern finance to poison the American economy and culture has stopped that cleansing from occurring.
Such a systemic writedown of bad debt in a system with only razor-thin capital to support a mighty edifice of leverage and debt would wipe out Wall Street and the banks and reveal the skimming operation of modern finance as an impossible perpetual motion machine rigged to enrich a thin crust of citizenry at the expense of the rest. And since they skim enough money to buy political protection, Capitalism has been strangled and tossed in a shallow grave lest it disupt the skimming and the political corruption that keeps the machine running.
What we end up with is artificial valuations, endless propaganda and a zombie economy. When borrowers are left dangling in default and the assets left on the books at full value, you end up with zombie debtors, zombie lenders, a zombie government that only has one lever to pull to keep the whole corrupt pathology going--borrow and squander more money-- and ultimately a zombie economy, drifting and decaying in a fetid pool of lies, shadow banking, ceaseless official propaganda, jury-rigged "fixes," manipulated statistics, corruption, predation, exploitation and pathology.
That's the U.S. economy, and indeed, the economies of the E.U., China and Japan in a nutshell.
The only way to clear a zombie economy is to write off uncollectable debt and liquidate all the assets, loans and hedges. That would collapse our financial system, but since it is the cause of our political and economic dysfunction, that would be the highest possible good and extremely positive.
There is a great final irony in the scare-mongering threats of the skimmers and their political toadies. If the taxpayers don't bail out the skimmers, then we'll have martial law by the weekend, the smouldering fires of Europe will rekindle into open warfare, and so on.
The irony is the propping up of a deeply, intrinsically pathological and destructive financial system is not saving the economy, it's the reason the economy is imploding. The Big Lie technique of propaganda is to reverse the polarity of reality: we are told up is down until we believe it.
We are told that liquidating the overhang of bad debt, leverage and hedges would "destroy the world as we know it." The truth is that keeping the zombie system from expiring and covering up the corruption with propaganda is what's actually destroying the world as we know it.
Thus the collapse of the current financial system of central banks, pathological Wall Street and insolvent banks would be the greatest possible good and the greatest possible positive for the global economy and its participants. ....
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