Busted: Bankers and The Global Economy

February 23, 2009

PM Brown: New Global Economy

pm-brown-berlusconi-romeBritish Prime Minister Gordon Brown has stressed the importance of April’s G20 ‘Economic Recovery Summit’ in London in the bid to strike a “global deal” that will “speed up the recovery of the world economy”. He and other European Union members are advocating a new global financial system, but have backed off somewhat due to the reluctance of U.S. support. His recent statement in Rome revealed that all nations need to inject resources into their own economies as well as agree on ways to reform international institutions.

Currently, he is recommending new policies that he calls ‘fairness principles’ against “old excesses” in the banking community, a standard of stewardship instead of speculation. In the meantime, Brown and other European Union members are advocating unity in opposing moves towards protectionist trade policies. They see the U.S. as a major opponent where such policies are concerned.

Back in the United States, international bank holding company, Citigroup continues its precipitous decline. The U.S. government is looking at boosting its’ controlling interest in the banking firm to boost confidence and maintain solvency from toxic debt, part of the speculation that PM Gordon Brown was referring to.  Britain is dealing with similar issues relating to the Royal Bank of Scotland. ~ E. Manning

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November 11, 2008

Britain: New Global Order and Finance

the only thing to fear is fear itself

the only thing to fear is fear itself

History seems to be in the making. The British Prime Minister is on the forefront of digital and economic globalization that sees the current turmoil in the world economy offers a chance to build a “new global order” based on cooperation and opportunity.

Mr. Brown summarized his approach as internationalist, interventionist and progressive, an approach he believes should make the world confident for the future, making 2008 a year to be remembered not for the financial crash, but for the way in which the world “endured it and prevailed”.

pm-and-lord-mayor-banquetOnce again, the British are on the forefront of promoting a new empire of global unity as an enduring power of ideals that promotes a global society that rises to meet challenges as they arise. The Prime Minister sees financial stability as an international duty of peace and unity. He wants to use U.N. peacekeepers to enforce the peace through the reduction of weapons, both nuclear and otherwise.

He speaks of getting behind the United States to bring about a new change of global mission even though at this time, neither George Bush or Barack Obama are now speaking about this mission. Barack Obama has dropped hints. Could something be going on behind the scenes that isn’t public knowledge? This prospect seems likely.

Prime Minister Brown gives high meaning to what he sees as the new Bretton Woods accord, involving the creation of a new monetary age and a new age of international cooperation. He is promoting getting rid of old orthodoxies in exchange for building on a new global solution of prosperity through the World Bank and new measures to sustain growth. This effort seems to built around the charismatic conviction of Gordon Brown and Barack Obama. You should be paying attention. For those that are concerned with Biblical prophecy, this is a very interesting item to take note of. ~ E. Manning

October 13, 2008

Is a New Era of Economic Finance on the Way?

Britain taking charge

Britain taking charge

While many nations muddle undecisively about their part in the looming global finance crisis, Britain has increasingly taken bolder and more decisive steps in an effort to stem the tide of ruin. Now Prime Minister Gordon Brown is calling for a new financial accord to refashion banking and finance rules for the modern era. “We must now create the right new financial architecture for the global age.”

Many governments in Europe has agreed to follow Britain’s lead by recapitalizing banks and guaranteeing interbank lending. The G-8, of which Britain is a part, are in the planning stages for a meeting soon. “We must now reform the international financial system around agreed principles of transparency, integrity, responsibility, good housekeeping and co-operation across borders.”

Under the British plan, banks that are rescued with taxpayer money will be forced to cease bonuses that have encouraged excessive risk-taking in the past as well as terminating dividends to shareholders. The down side to the bank rescues is that there is currently no incentive for investment and little hope for immediate growth, both hallmarks of the “for profit” market.

While bailing out bankers will sustain the economies for the time being, the end result will be recession coupled with nasty inflation and economic stagnation in some countries if moves are not made to bolster job creation, wages and check price increases. So far, because of credit dependence, nations can expect stymied growth, triggering more defaults and a continuation of tightening lending terms. Nations have been hesitant to guarantee interbank lending because of the trust factor. The pressure is on as the global goal becomes the prevention of a global economic depression.

U.S. economic growth next year will be the weakest since 1954, with unemployment expected to rise to 8.5 percent.

Large corporations are increasingly under the economic gun. American automakers are considering mergers and General Electric is considering a bank charter to provide better funding. Bank lending remains locked down despite flooding the market with monetary credit and interest rate reductions. A continued lockdown will likely result in the depression that scrambling governments are seeking to avoid. Indications are that we are in a global vicious circle of economic decline. The alternative is breaking the cycle. Who is going to break the cycle and how?

British money manager Paul Niven remarked, “We have now entered a new era for global banking. In return for taxpayers’ money, the state will gain a level of control over their governance, pay, and lending practices.” Is Niven’s statement a reality or the work of wishful fiction?

Could the world have the beginnings of a new global banking order or is this move simply an action involving separate economic nationalization of banking and finance to preserve the current financial structure? Perhaps we will know once clearer heads rule the roost. Bible prophecy indicates a new global system that portends to usher in a new era of security. Is there any stock to that? What say you? ~ E. Manning

September 12, 2008

Lehman: The Prophecy of Failure

Lehman Brothers paints themselves as an innovator in global finance as they serve the financial needs of corporations, governments and municipalities, institutional clients, and high net worth individuals worldwide. They “maintain leadership positions in equity and fixed income sales, trading and research, investment banking and investment management.

In advance of the collapse of investment banker Bear Stearns in March of this year, rumors have been circulating continually about the demise of Lehman. Those have hardly quelled since then. As a result, the value of the stock holdings has steadily evaporated and the value of the investment bank plummeted.

Employees are now worried and expecting pink slips. The New York Times is pointing out that the Lehman decline is much like Bear Stearns. However, while the failure and decline is similar, the circumstances that brought those about is very much different.

The demise of Bear Stearns was brought about by bungling, bad financial moves within the banking system and an ensuing panic. The collapse was quick and decisive. The decline of Lehman has been created by the prophecy of pessimism, the fear of weakness which has been mostly unrelenting. This undercurrent of perceived weakness has evolved over time despite the efforts to prop up the firm.

The Times reports an employee as saying, “Everyone is walking around like they have just been Tasered. Everyone was always hoping we would pull through. Now, that is not really an option.” The undercurrent involving a lack of confidence has been pernicious, even on the inside.

The media has talked up the demise and is now talking up the sale of the company. “The cold prospect of losing a life savings in Lehman stock has become more of a reality, many employees have grown resentful.” While that is true, the idea of investing is usually based on a sound investment. It is sad that employees have chosen to sink with the ship instead of divesting themselves if that were possible. What is more sad is that a wealthy corporation like Lehman hasn’t bothered to secure even a small portion of interest in their employees. That is, in fact, the dilemma that threatens the very fabric of American society. It’s all about “me.” This eighties born attitude rises to the top of the corporate ladder. The backlash has been and will be substantial except for the corporate leaders.

It is true that business is not about charity. However, this writer is not discussing charity. The problem is that life in America has become so self-centered that the prospect of tomorrow is rarely if ever addressed. There is lack of planning and little care for tomorrow or for anyone else on any level. That attitude is as prevalent at the top of business as it is at the bottom. The nation has thoroughly corrupted itself and the corporate environment that it originally built. There is not even the illusion of responsibility. Live for today for tomorrow is its own.

Sooner or later, that attitude along with the prophecy of failure comes home to roost. ~ E. Manning

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