‘If ever a story deserved to be filed under the heading “irony” it is the one about a “caring capitalism” summit ending in a bitter legal dispute among the organisers over money. Thursday’s Evening Standard reports that Lady Lynn Forester de Rothschild – the former financier, director of Estee Lauder and the Economist and member of one of the world’s wealthiest families – is suing the charity that helped stage the Conference on Inclusive Capitalism in May, the Henry Jackson Society, on a catalogue of issues, including intellectual property and residual funds and unpaid invoices totalling £187,000.
The world was abuzz in the 90s with conversations of whether capitalism could indeed be “caring”. Companies such as Ben & Jerry’s were leading the way with new corporate concepts and ethical structures. Some academic articles glumly concluded that such new concepts “will be prone to eventual failure and subsumption by fast capitalism”. Twenty years later, while inequality continues to grow and the world is becoming increasingly volatile, we are still having the same conversation. Meanwhile, Ben & Jerry’s has been bought by Unilever.
Capitalism, in its unadulterated form, is not caring. It is not inclusive, responsible or ethical. It is fast, callous, amoral, decisive, aggressive, self-interested and only cares about one thing: the bottom line. This is not a criticism. It is just how it is built.’
‘[...] The rules of money and banking have changed every 20 or 30 years for the past three centuries, in an ongoing trial-and-error experiment in evolving a financial system, and an ongoing battle over whose interests it will serve. To present that timeline in full will take another article, but in a nutshell we have gone from precious metal coins, to government-issued paper scrip, to privately-issued banknotes, to checkbook money, to gold-backed Federal Reserve Notes, to unbacked Federal Reserve Notes, to the “near money” created by the shadow banking system. Money has evolved from being “stored” in the form of a physical commodity, to paper representations of value, to computer bits storing information about credits and debits.
The rules have been changed before and can be changed again. Depressions, credit crises and financial collapse are not acts of God but are induced by mechanical flaws or corruption in the financial system. Credit may stop flowing, but the workers, materials and markets are still there. The system just needs a reboot.’
- Transcript of Yellen and Lagarde Comments at IMF Event
- Too-Big-To-Fail Banks Gamble With Bernanke Bucks
- Winner Takes All: The Super-priority Status of Derivatives
- The Most Important Number In The Entire U.S. Economy
- American Delusionalism, or Why History Matters
- World Federation of Exchanges – over $2 quadrillion of derivatives in 2013
- The Public Bank Solution
‘Take a good look at the chart and you’d be excused for concluding that we’re in the midst of the greatest stock market bubble of all time. Not only has the S&P 500 fully recovered from the financial crisis, it’s a staggering 30% higher than the peaks of the Internet and housing bull markets.
But is this really the case? With unemployment still above 6%, how could we find ourselves in the throes of yet another brewing catastrophe? Didn’t investors and analysts learn anything from the past decade and a half?
While it requires some explanation, the answer is that we’re most likely not experiencing another irrational inflation of stock prices. The market’s record level is instead a predictable response to the Federal Reserve’s policy of keeping interest rates at historically low levels.’
A Guardian investigation has discovered a growing trend in the capital’s upmarket apartment blocks – which are required to include affordable homes in order to win planning permission – for the poorer residents to be forced to use alternative access, a phenomenon being dubbed “poor doors”. Even bicycle storage spaces, rubbish disposal facilities and postal deliveries are being separated.
The Green party accused developers of showing “contempt for ordinary people” by enforcing such two-tier policies.’
‘Greece ranks first in the eurozone and fourth among the 28 members of the European Union for the percentage of its citizens living on or below the poverty line, according to a new report. The study, conducted by the Foundation for Economic and Industrial Research (IOBE), found that just over a third (34.6%) of Greeks – some 3,795,100 individuals – were living on less than 60% of the national median income in 2013.
This percentage has risen steadily since 2010, when the country began implementing austerity measures, increasing from 27.6% in 2010 to 27.7% the following year, 31% in 2012 and 34.6% in 2013. The publication of the study, which is based on Hellenic Statistical Authority (Elstat) data, coincided with the 40th anniversary of the effective ending of military rule in 1974.’
- Greece: A fragile calm
- International creditors remain sceptical about Greece’s ability to reform without close supervision
- Greek economy to grow by 0.7% after six years of recession
- Greek banks to quadruple housing loans by next year?
- Greece faces power cuts as unions plan strikes
- Greece forges template for economic recovery as tourists pour in
- Greece gets strong interest in oil, gas blocks, minister says
- Court rules seizure of debtor’s deposits without notice is constitutional
- SS songs and antisemitism: The week Golden Dawn turned openly Nazi
- In Greece, a battle to reclaim the seashore as commons
- EU Warns Greece Is “A Cause Of Serious Concern” As Top Tax-Collector Resigns
- Car bomb explodes outside Greek central bank building, no one hurt
- Black Rock warns “Greece most likely to default”
‘The Canada Revenue Agency has told a well-known charity that it can no longer try to prevent poverty around the world, it can only alleviate poverty — because preventing poverty might benefit people who are not already poor.
The bizarre bureaucratic brawl over a mission statement is yet more evidence of deteriorating relations between the Harper government and some parts of Canada’s charitable sector.’
‘Detroit residents are struggling to pay their water bills at such an alarming rate that the city’s utility announced a few months ago that it would cut off water for between 1,500 and 3,000 people every week. The situation has gotten so bad that the United Nations has had to step in and tell the city that such massive water shut-offs are a violation of human rights. People are desperate just to keep their taps turned on, as about half the city has fallen behind on its bills. As a resident recently told ThinkProgress, “when half of the city can’t do something, it tells you it’s a systemic problem.”
Now, an unlikely group seems to think it can step in and solve this systemic problem. PETA, the People for the Ethical Treatment of Animals, announced in a blog post on Thursday that it will offer financial assistance to 10 families who can’t afford their water bills — if the families go vegan, that is.’
‘Time magazine (7/17/14–subscription required) has some good news for you, courtesy of investment banker and former Clinton Treasury official Roger Altman: “Surprise: The Economy Isn’t as Bad as You Think.”
After noting that “in the latest NBC News/Wall Street Journal poll, 63 percent of respondents said the US is on the wrong track,” Altman insists that “despite the pessimistic mood, America is experiencing a profound comeback.”‘
‘Barack Obama’s Justice Department on Monday announced that Citigroup would pay $7 billion in fines, a move that will avoid a humiliating trial dealing with the seamy financial products the bank had marketed to an unsuspecting public, causing vast damage to the economy.
Citigroup is the too-big-to-fail bank that was allowed to form only when Bill Clinton signed legislation reversing the sensible restraints on Wall Street instituted by President Franklin Roosevelt to avoid another Great Depression.
Those filled with Clinton nostalgia these days might want to reflect back on how truly destructive was his legacy for hardworking people throughout the world who lost so much due to the financial shenanigans that he made legal.’
‘Letters to parents requesting a meeting to discuss “concerns that have been raised” usually only happen at school to the parents of kids with the foresight to realise that smoking while your lungs are still developing is totally badass. When you’re an adult, you don’t have to worry about your parents finding out what you get up to, unless you’re stupid enough to get duped into taking a free holiday by BBC3.
So you can imagine the surprise University of Birmingham Politics student Pat Grady’s parents felt when a letter from counter terrorism police, landed on their doormat inviting them “into the local police station” to “discuss concerns” that their son “[might] be involved with domestic extremism”.’
‘Detroit is temporarily suspending its policy of cutting off water for low-income residents who are delinquent on their bills. In March, the city sent out 45,000 shutoff notices and began turning off water for thousands of citizens. After a public backlash, rallies against the policy and even calls to the UN for humanitarian assistance, the bankrupt city decided it may need to reevaluate how it is handling the situation.’ (Meghan Lopez)
- Detroit water shut-offs condemned as threat to health
- No Water For Motown: Why Detroit Is Denying Its Citizens This Basic Human Right
- Workers on Detroit water shutoffs: “They are making it so you can’t live”
- “A Commercially Successful Human Rights Violation” In Detroit
- Water is a Human Right: Detroit Residents Seek U.N. Intervention as City Shuts Off Taps to Thousands
- Detroit Bankruptcy: Clearing City’s Blighted Properties to Cost $2bn
- US Prepares To Provide A Billion To Ukraine As Detroit Plans Mass Water Shutoffs Over $260 Million
- The Real Story Behind the Detroit Pension Fight and What it Means to America’s Future
‘It would be difficult to come with a more on-the-nose metaphor for New York City’s income inequality problem than the new high-rise apartment building coming to 40 Riverside Boulevard, which will feature separate doors for regular, wealthy humans and whatever you call the scum that rents affordable housing.
Extell Development Company, the firm behind the new building, announced its intentions to segregate the rich and poor to much outrage last year. Fifty-five of the luxury complex’s 219 units would be marked for low-income renters—netting some valuable tax breaks for Extell—with the caveat that the less fortunate tenants would stick to their own entrance.’
Editor’s Note: Nomi Prins is a former managing director at Goldman Sachs and a former senior managing director at Bear Stearns. You can read an abridged version of her remarks at her website. I would HIGHLY recommend reading her new book “All The Presidents’ Bankers“, one of the best works on the history of America’s financial elite that has ever been written. She is also author of “It Takes A Pillage” and the novel “Black Tuesday“.
‘[...] Although the Obama years have been boom times for America’s super-rich—recent work by the economists Emmanuel Saez and Thomas Piketty showed that ninety-five per cent of income gains in the first three years of the recovery went to the top one per cent—a lot of them believe that they’re a persecuted minority. As Mark Mizruchi, a sociologist at the University of Michigan and the author of a book called “The Fracturing of the American Corporate Elite,” told me, “These guys think, We’re the job creators, we keep the markets running, and yet the public doesn’t like us. How can that be?” Business leaders were upset at the criticism that followed the financial crisis and, for many of them, it’s an article of faith that people succeed or fail because that’s what they deserve. Schwarzman recently said that Americans “always like to blame somebody other than themselves for a failure.” If you believe that net worth is a reflection of merit, then any attempt to curb inequality looks unfair.
That’s not how it’s always been. A century ago, industrial magnates played a central role in the Progressive movement, working with unions, supporting workmen’s compensation laws and laws against child labor, and often pushing for more government regulation. This wasn’t altruism; as a classic analysis by the historian James Weinstein showed, the reforms were intended to co-opt public pressure and avert more radical measures. Still, they materially improved the lives of ordinary workers. And they sprang from a pragmatic belief that the robustness of capitalism as a whole depended on wide distribution of the fruits of the system.’
- Pepe Escobar: BRICS against Washington consensus
- BRICS establish $100bn bank in challenge Western dominance
- New BRICS bank to be based in China, India to have presidency
- Putin tells BRICS to set up energy bloc to boost safety
- The BRICS try to reshape the world
- BRICS summit: Banking on a new global order
‘Just days before its international debut at an airshow in the United Kingdom, the entire fleet of the Pentagon’s next generation fighter plane — known as the F-35 II Lightning, or the Joint Strike Fighter — has been grounded, highlighting just what a boondoggle the project has been. With the vast amounts spent so far on the aircraft, the United States could have worked wonders, including providing every homeless person in the U.S. a $600,000 home.
It’s hard to argue against the need to modernize aircraft used to defend the country and counter enemies overseas, especially if you’re a politician. But the Joint Strike Fighter program has been a mess almost since its inception, with massive cost overruns leading to its current acquisition price-tag of $398.6 billion — an increase of $7.4 billion since last year. That breaks down to costing about $49 billion per year since work began in 2006 and the project is seven years behind schedule. Over its life-cycle, estimated at about 55 years, operating and maintaining the F-35 fleet will cost the U.S. a little over $1 trillion. By contrast, the entirety of the Manhattan Project — which created the nuclear bomb from scratch — cost about $55 billion in today’s dollars.’
‘The government on Monday faced a call to impose legal caps on executive salaries after a study found top pay in Britain has reached 180 times average wages. The High Pay Centre said that since the late 1990s executive pay has grown from 60 times that of the average British worker to nearly 180 times.
It wants the government to consider requiring companies to cap executive pay at a fixed multiple of their lowest-paid employee. Last year the government gave shareholders the power to vote down executive pay policy at company AGMs if they thought the proposed pay package was too large.
So far, however, every vote at a FTSE 100 company has seen a majority of shareholders support the company policy on top pay, the Centre said. Last year pay received by the average FTSE 100 chief executive increased to £4.7 million, up from £4.1 million in 2012, it said.’
‘Forecasters have good news for those fearing that Britain faces a long, slow decline into economic mediocrity: the UK will still stand tall among the world’s biggest economies in 2030, having overtaken France and even made progress on closing the gap with Germany.
Only India will leapfrog the UK on the rich list of nations, according to the report by PricewaterhouseCoopers (PwC), as the previously fast-growing countries Russia and Brazil struggle to make ground on the global league table.
According to the report, the youthful vigour of the UK economy, with its high birthrate and flexible labour market, will contrast markedly with the ageing populations of mainland Europe. Ignoring the potential for Scotland to spoil the party by voting to separate in September, the report forecasts that Britain will remain “a significant member of the global economic A-list”.’
‘“We have found that welfare reforms play a huge part in this,” Reverend Alan Dickinson from the North Tyneside food bank told 60 food bank managers and charity workers gathered in a church hall in South Shields yesterday afternoon.
A group of MPs from the all-party parliamentary inquiry into hunger and food poverty listened for two hours as food bank staff described why people in the area around Newcastle were increasingly demanding their help.
The MPs, both Labour and Conservative, making a rare joint excursion from Westminster, were trying to shed light on one of the most contentious issues of the coalition administration: why is it that use of food banks has exploded in the past four years, and how extensive is food poverty across the country?’
‘More scandals in the financial sector are in the pipeline, the Treasury Minister responsible for the City of London has admitted. Andrea Leadsom, who previously worked in banking and finance for 25 years, warned that there were more “cringeworthy announcements” to come and that there was “still a lot of baggage” in the financial industry.
Ms Leadsom, who held senior roles at Barclays and Invesco Perpetual before becoming an MP, told the parliamentary magazineThe House there was still a long way to go change the City’s culture. Asked whether it is learning the lessons of the financial crisis, she replied: “I would say that at the top echelons of the banks, absolutely. But I think there’s quite a long way to go to really change the culture. I think it did become very transaction-oriented and I think it will take time to recover that. I think we are still going to see a lot of cringeworthy announcements.” She admitted that when she heard about the Libor interbank lending rate scandal, she thought: “Well, if Libor is rigged, then what wasn’t rigged?”’
‘Even if you are a bank as gigantic as BNP Paribas, $9 billion is a lot of money. Shareholders of the French bank know that all too well, as that is what they are paying in penalties to the United States for a conspiracy to allow money transfers to Sudan and other blacklisted nations.
The case is remarkable for the size of the penalty, which is a bit more than the bank’s total earnings for 2013. But it may be more interesting for the lesson it teaches about how the United States’ financial power goes hand in hand with its role in foreign affairs.
In short: The dollar is the global reserve currency, the bedrock of the world financial system. And that role gives the United States surprising power over what happens in the world even in spheres that would have little to do with finance.’
‘JPMorgan CEO Jamie Dimon told his employees that he has ‘curable’ throat cancer. In a note to staff, Dimon said, “The good news is that the prognosis from my doctors is excellent, the cancer was caught quickly, and my condition is curable.”
JPMorgan’s board of directors has been briefed on his condition, which will likely call for about eight weeks of radiation and chemotherapy at Memorial Sloan Kettering in New York City, according to the note. “I feel very good now and will let all of you know if my health situation changes,” Dimon’s note said.’
Editor’s Note: Abby Martin recently discussed America’s obsession with working and how it is destroying their health and family life. Below the video you can also find links to other related information including a great article on “bullshit jobs“.
‘One of Britain’s leading doctors has called for the country to switch to a four-day week to help combat high levels of work-related stress, let people spend more time with their families or exercising, and reduce unemployment. Bringing the standard working week down from five to four days would also help address medical conditions, such as high blood pressure and the mental ill-health associated with overwork or lack of work, Prof John Ashton said.
The president of the UK Faculty of Public Health said the five-day week should be phased out to end what he called “a maldistribution of work” that is damaging many people’s health. “When you look at the way we lead our lives, the stress that people are under, the pressure on time and sickness absence, [work-related] mental health is clearly a major issue. We should be moving towards a four-day week because the problem we have in the world of work is you’ve got a proportion of the population who are working too hard and a proportion that haven’t got jobs”, Ashton said. “We’ve got a maldistribution of work. The lunch-hour has gone; people just have a sandwich at their desk and carry on working,” added the leader of the UK’s 3,300 public-health experts working in the NHS, local government and academia.’
‘If the EU has its way, a final agreement between the EU and the US to establish a free trade and investment agreement the Transatlantic Trade and Investment Partnership (TTIP) will weaken regulation and raise obstacles to much needed reform of the financial sector. That is the conclusion after the leak of an EU proposal for so-called “regulatory cooperation” on financial regulation tabled by the EU in March 2014. Regulatory cooperation is a continuous process of ironing out disagreements and differences between the two Parties to ensure agreement on what constitutes legitimate regulation – which in this case, would serve the interests of the financial industry. In the document, the EU suggests a number of mechanisms that will both scale back existing regulation, and prevent future regulation that might contradict the interests of financial corporations from both sides of the Atlantic. The leak follows news that EU negotiators have increased political pressure on the US to accept negotiations on “financial regulatory cooperation”, which the US negotiators have so far refused.
The document shows that the EU is prioritising the protection of the EU’s banking sector over strict financial regulation and supervision: these so-called “regulatory cooperation” proposals would guarantee that the financial sector is not harmed by measures taken by regulators, would allow EU banks to operate in the US on the EU’s (generally laxer) rules, and in general that financial corporations on one side of the Atlantic do not have to abide by host country’s laws but only by home country laws on the other side of the Atlantic. The implications for decision-making on financial reforms and control over the financial sector are serious.’
‘Pope Francis has condemned the “moral decay” of the city of Rome, citing the child prostitutes that ply their trade and the busy soup kitchens of the Italian capital. In a broadside against declining moral standards in the West, the Pontiff cited the darker sides of the streets of his adopted home as an example of modern society’s failings.
Despite it being the home of the Vatican, Pope Francis said, “The Eternal City, which should be a beacon to the world, is a mirror of the moral decay of society.” In a wide-ranging interview with Rome daily Il Messaggero, he also lashed out at political corruption, joblessness and Europe’s low birth rates. He claimed that many Europeans found it easier to own pets than raise children.’
- Poor parent-child bonding ‘hampers learning’
- UK govt’s new shared parental leave part of a growing global trend
- Obama says US should have paid maternity leave
- More than 120 Nations Provide Paid Maternity Leave
- Sweden To Experiment With Six-Hour Workday
- On the Phenomenon of Bullshit Jobs
- Willing Slaves: How the Overwork Culture is Ruling Our Lives (Book)
- Working Ourselves to Death: The High Cost of Workaholism and the Rewards of Recovery (Book)