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Banking as the Scourge of Capitalism

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By Numerian

Banksy

"The Federal Reserve is doing whatever it can – and some of this is against their charter – to revive the failed system of TBTF banks, securitization, and debt binges which will inevitably lead to another massive bubble, leaving the public on the hook for future bailouts." Numerian

Joe Nocera, financial columnist for The New York Times, had an interesting conclusion to his recent article on Bank of America:

I admit it: I want to see the banks feel some pain. Most people do, I think. Banks did terrible things during the subprime bubble, and they still haven’t paid any real price. I find myself rooting for judges to rule against banks in foreclosure cases. I would love to see these big investors put the serious hurt on Bank of America, which will encourage other investors to pile on. I know this colors my thinking. I can’t help it.

Yet I also know the flip side. If the foreclosure lawyers start winning a lot of cases, if judges halt foreclosures on a widespread basis, if investors start to extract billions upon billions of dollars from the banks — and if banks become seriously weakened as a result — we’ll be right back where we were two years ago. The banks will need to be saved for the good of the economy. The taxpayers will have to come to the rescue. That’s an appalling prospect too.

Banks: We can’t live with them, and we can’t live without them. It stinks, doesn’t it?

This brief flourish of disgust for the banking industry received a lot of attention, almost all of it favorable. Millions of Americans want to see “serious hurt” put upon the banks, especially the big banks that are in the Too Big To Fail category. Why do we hate the banks so?

Indian Offshore Outsourcers Start Propaganda Campaign, Funding Elections to Get Your Job

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the tokensIn a backdrop of election 2010, we have more spin. NASSCOM, the India offshore outsourcing industry is starting a media and public relations campaign to get your job.

India’s top tech firms, along with Nasscom, are lobbying harder on Capitol Hill and are set to launch a public campaign on hiring more local staff in the US as political rhetoric against offshoring of IT and back office jobs reaches an all-time high ahead of the US November elections.

Hiring Americans is not what they will do in reality. Instead they will contract or hire a few token Americans to point to as evidence they are not committing global labor arbitrage. Labor arbitrage, or squeezing workers for profits, is the entire business model of these Indian body shops.

These same offshorers are buying our elections and controlling our Congress.

Bangalore-based Wipro spent $33,000 as lobbying costs in Q2 this year in the US. Chennai-based Cognizant has spent a whopping $320,000 in lobbying this year.

Now guess which party is completely in their pockets? Republicans.

Some of the intense lobbying and other initiatives are already bearing fruit. Last month senate Republicans defeated a bill aimed at taxing American multinationals moving services and manufacturing jobs to cheaper overseas locations such as China and India.

TARP Bail Out Blasted

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nun with rulerThe Great Wall Street Bail Out, TARP, gets an F for f&@&... something the middle class. Neil Barofsky grades TARP and let's just say it's more than a ruler whack across the knuckles.

SIGTARP, aka TARP Inspector General, has released a new report (large pdf) on TARP. Here are the grades per TARP's own stated objectives.

  1. Increase lending to small business? FAIL
  2. Decrease Unemployment? FAIL
  3. Preserve Homeownership? FAIL
  4. Remove Moral Hazard? FAIL
  5. Reduce Financial Sector Size? FAIL

The above summary might be harsh, yet the report pretty much concludes the same thing. TARP was clearly a bail out for Wall Street, leaving Main Street in the dust.

It's clear SIGTARP is frustrated with Treasury. Here's an overall blast quote from the report against Tim Geithner:

Corporate Takeover Stalls in California - Healhens hold the line

Michael Collins
California

California's economic depression is the key campaign issue. The official state unemployment rate is 12.4%. When you add those who've simply given up looking for a job plus the marginally employed, the figure for the state is over 20%. Official unemployment in the San Joaquin Valley, a huge agribusiness region, ranges from 15% to 19%. Long the economic engine for the nation, the state is not accustomed to hard times.

The corporate takeover of California is on hold according to the latest polls out of the nation’s largest state. Just nine days before the election, the Los Angeles Times and University of Southern California poll shows a nearly impossible uphill battle for the big business ticket of former eBay CEO Meg Whitman and former HP CEO Carly Fiorina.

Among likely voters in the governor’s race, Brown leads Whitman 50% to 38%. In the race for United States Senator, two term Senator Barbara Boxer maintained an 8% lead. The leads by Democrats come from a brand new constituency, those who "never" go to church. More on that later.

Sunday Morning Comics - Donald Duck Edition

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Brought to you by Spinning Truth for Millions - We take damning truths, sprinkle them with fear, then spin what caused the damning truth to now be the solution. Yeah, we can't believe how well this works either.
Cup O' Joe

 

Good Morning! Rise and Shine! Get that Cup O' Joe...
break out the O.J....hang out with the pooch...time to check out the Funnies.

 

G-20 Meeting Gives More Power to China, India, Brazil

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g20Earlier we noted Geithner proposed balanced trade at the G-20 meeting.

How did that work out for ya?

Well, in response to the demand the G-20 confront currency re-evaulation, the G-20 gave China and Brazil more power.

More than 6 percent of IMF voting rights will be reallocated to countries such as China, while Europe will give up two board seats, G-20 finance ministers said yesterday after meeting in Gyeongju, South Korea. They also assigned the Washington-based fund a role in monitoring global trade imbalances and exchange rates.

Great, the biggest currency manipulator now has more power in the IMF, plus one of the biggest offshore outsourcing destination countries now have board seats.

After the changes take effect, the fund’s 10 biggest shareholders will comprise the U.S., Japan, four major European economies and Brazil, Russia, India and China. The IMF will have 24 board seats.

From International Business Times, that ain't too swank, it implies the Asian countries, particularly China, India, can act as a block, in unison.

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