Busted: Bankers and The Global Economy

July 16, 2009

Global Economic Crisis: G8 and the Papacy

G8 ItalyDuring the G8 economic meetings and debate in Italy, Pope Benedict released a new encyclical saying “there is urgent need of a true world political authority.” In that document, Pope Benedict XVI urged G8 leaders meeting in Italy to rewrite global financial rules and to defend the world’s poor from the effects of the economic crisis.

responsibility of the market

In and of itself, the market is not, and must not become, the place where the strong subdue the weak. Society does not have to protect itself from the market, as if the development of the latter were ipso facto to entail the death of authentically human relations. Admittedly, the market can be a negative force, not because it is so by nature, but because a certain ideology can make it so. It must be remembered that the market does not exist in the pure state. It is shaped by the cultural configurations which define it and give it direction. Economy and finance, as instruments, can be used badly when those at the helm are motivated by purely selfish ends. Instruments that are good in themselves can thereby be transformed into harmful ones. But it is man’s darkened reason that produces these consequences, not the instrument per se. Therefore it is not the instrument that must be called to account, but individuals, their moral conscience and their personal and social responsibility.

responsibility of business

Owing to their growth in scale and the need for more and more capital, it is becoming increasingly rare for business enterprises to be in the hands of a stable director who feels responsible in the long term, not just the short term, for the life and the results of his company, and it is becoming increasingly rare for businesses to depend on a single territory. Moreover, the so-called outsourcing of production can weaken the company’s sense of responsibility towards the stakeholders — namely the workers, the suppliers, the consumers, the natural environment and broader society — in favour of the shareholders, who are not tied to a specific geographical area and who therefore enjoy extraordinary mobility. ...business management cannot concern itself only with the interests of the proprietors, but must also assume responsibility for all the other stakeholders who contribute to the life of the business: the workers, the clients, the suppliers of various elements of production, the community of reference.

The papacy has taken an interesting step by inserting itself into the G8 debate framework and  by ordering the involvement of Italy in the process. Certainly, in much earlier times, the papacy was directly involved in such matters without better consequences in those times. History is the best  witness of that truth. Now, the pope indicates that we need a man in charge once again as if the G8 institution is really in charge beyond politics. The real charge has been given to multinational corporations including central bankers on a global basis. The central bankers operate as a global corporate fraternal brotherhood through none other than the Swiss and Rome. Is the papacy and politics going to ‘take authority back’ or have they really lost any authority? The reality is that the papacy already holds ‘such coveted authority’ through the central bankers. Most of them have simply forgotten their moral compass in their need to service their clients. Pope Benedict is simply reminding his league that he holds them to a higher priority and that they need to exert a new influence as they continue to profit from money lending.

G8 first ladies and pope

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September 11, 2008

The Con Game of Securitization and Wealth

crisis through securitization

crisis through securitization

According to Federal Reserve’s Vice Chairman Donald Kohn, “One reason for the loosening of standards was the expectation that house prices would continue to rise and even more certainly that they could not fall in all regions at the same time, supporting diversification through securitization.”

This small sentence combined with a summary of all the accumulated evidence maintained by the Federal Reserve shows the propensity for a lack of regard for economic concerns over the immediate concerns of profit.

“Rising prices would enable lenders to recoup their funds even if the borrower was unable to service the loan, mostly because the borrower would be able to obtain extra cash through refinancing. Expectations of house price appreciation facilitated and interacted with the increasing complexity of mortgage securities, including multiple securitizations of the same loan, which made it virtually impossible for ultimate lenders to monitor the creditworthiness of borrowers. This was a task they had outsourced to credit rating agencies. The absence of investor caution and due diligence was especially noticeable for the highest-rated tranches of securitized debt.”

securitized vomit

securitized vomit

Who started the securitization of loans to begin with? Give the government geniuses at Fannie Mae and Freddie Mac credit for the wunderkind of shaky banking ‘o so many years ago. That is why authorities in banking and in government are quite mum about the evil and deception of securitized bonds. What is worse, they have no intent to change a thing.

The Federal Reserve is still brainstorming new ways to “ameliorate systemic risk. That said, a host of difficult judgments are inherent in how we establish such a system.” That is the trillion dollar question. In the words of Donald Kohn; “How we can structure these requirements and other aspects of regulation to damp, rather than reinforce, the natural procyclical tendencies of the financial system?”

economic usury

economic usury

If the U.S. economy were equated to an automobile engine, we would be running on half the cylinders. The Federal Reserve and other surrogate economists don’t have a clue and are now discussing “solutions” among themselves. Global bankers long for a solution to the trillion dollar question and they want to continue doing the same old things as long as it makes them money for the short-term. The idea is not what is good for any economy, but what is good for quick profits for themselves. That is what banking around the world has come to represent: corporate profit behind the scenes and personal profit while that is possible. Never forget that the Federal Reserve and global central bankers are corporations bent on making a profit, part of a “franchise” of banks that loosely report to Swiss and Roman bankers. They live off of the world; therefore economies are simply tools for wealth. That is the danger nations, governments and peoples face.

Don’t fool yourself. Global bankers are running the world to your peril. However, the sophisticated United States government and others are all for making a profit while they can, oblivious to the danger or convinced that they will live forever while central banking pumps them dry. ~ E. Manning

July 19, 2008

Swiss Secret Banking Dropped by UBS

Due to secrecy pressures from the U.S. federal government, Swiss-owned UBS has decided to drop offshore banking services in America because of criticism that the foreign bank assists Americans in rampant tax evasion. It is now much harder for Americans to participate in secret banking.

Meanwhile, the bank is cooperating with the U.S. government to identify U.S. clients who might have committed tax fraud by using UBS services. Because of the refusal of the Swiss to succumb to privacy pressures, UBS has elected to cease their offshore banking service altogether for America.

Client identity is usually protected under Swiss law, but not when (more…)

February 2, 2008

Dishonest Swiss Bankers?

Filed under: banking, investment, money — Tags: , , , , , , , , — digitaleconomy @ 7:31 pm

Reuters Article 2/2/08
U.S. government prosecutors are investigating whether Swiss banking giant UBS misled investors by reporting inflated prices of mortgage-backed securities it held despite knowing those valuations had eroded.

I have no doubt that whatever investigations that may be or come to pass reveal plenty of banking tomfoolery in the hopes of keeping profits up and losses to a minimum. I don’t know why, but somehow I expected more professionalism from Swiss bankers. Never underestimate the greed of a banker or his cronies. It’s best to remember that greed crosses all national borders. ~E.M.

January 30, 2008

Swiss Banking and Credit Woes

Filed under: banking, federal reserve, investment, money — Tags: , , , , , , , , , — digitaleconomy @ 5:32 am

UBS is among the hardest-hit of the banks around the world that have collectively suffered more than $100 billion in losses from the crisis originating from defaults in U.S. subprime mortgages.

Globe Investor 1/30/2008

International Herald Tribune 1/30/2008

If you have read any of my commentary, history or articles, you are aware of the importance of Swiss banking as well as its role in the world banking system. UBS is a major hinge of the international banking community and is tied into the private banking sector as well with secret investors and ties to the Roman Bank. Because of this role and the power of Swiss banking, the news of this article should cause bankers and investors great concern. UBS has an extensive holding of pensions and other commercial financial holdings that impact the retirement community. The fact that UBS has made the error of investing so heavily in U.S. subprime mortgages is oversight on their part. The real concern is the impact that continued hits will have on existing strongholds in the corporate finance, insurance, pensions and reserve funds of all kinds. All these funds are at additional risk because of this recent bad investment write-off. ~ E.M.

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