Henry Giroux On the Rise of Neoliberalism As a Political Ideology

"There is a lack of critical assessment of the past. But you have to understand that the current ruling elite is actually the old ruling elite. So they are incapable of a self-critical approach to the past."

Ryszard Kapuscinski

Mammon in the City of London, 1889

Are they incapable, or merely unwilling?  That is the credibility trap, the inability to address the key problems because the ruling elite must risk or even undermine their own undeserved power to do so.

I think this interview below highlights the false dichotomy between communism and free market capitalism that was created in the 1980's largely by Thatcher's and Reagan's handlers.   The dichotomy was more properly between communist government and democracy, of the primacy of the individual over the primacy of the organization and the state as embodied in fascism and the real world implementations of  communism in Russia and China.

But we never think of it that way any more, if at all.  It is one of the greatest public relation coups in history.  One form of organizational oppression by the Russian nomenklatura was replaced by the oppression by the oligarchs and their Corporations, in the name of freedom.

Free market capitalism, under the banner of the efficient markets hypothesis, has taken the place of democratic ideals as the primary good as embodied in the original framing of the Declaration of Independence and the US Constitution. 

It is no accident that the individual and their concerns have become subordinated to the corporate welfare and the profits of the upper one percent.  We even see this in religion with the 'gospel of prosperity.'   In their delusion they make friends of the mammon of unrighteousness, so that after they may be received into their everlasting habitations.

The market as the highest good has stood on the shoulders of the 'greed is good' philosophy promulgated by the pied pipers of the me generation, and has turned the Western democracies on their heads, as a series of political leaders have capitulated to this false idol of money as the measure of all things, and all virtue. 

Policy is now crafted to maximize profits as an end to itself without regard to the overall impact on freedom and the public good.   It measures 'costs' in the most narrow and biased of terms, and allocated wealth based on the subversion of good sense to false economy theories.

Greed is a portion of the will to power.   And that madness serves none but itself.

This is a brief excerpt. You may read the entire interview here.

Henry Giroux on the Rise of Neoliberalism
19 October 2014
By Michael Nevradakis, Truthout

"...We're talking about an ideology marked by the selling off of public goods to private interests; the attack on social provisions; the rise of the corporate state organized around privatization, free trade, and deregulation; the celebration of self interests over social needs; the celebration of profit-making as the essence of democracy coupled with the utterly reductionist notion that consumption is the only applicable form of citizenship.

But even more than that, it upholds the notion that the market serves as a model for structuring all social relations: not just the economy, but the governing of all of social life...

That's a key issue. I mean, this is a particular political and economic and social project that not only consolidates class power in the hands of the one percent, but operates off the assumption that economics can divorce itself from social costs, that it doesn't have to deal with matters of ethical and social responsibility, that these things get in the way.

And I think the consequences of these policies across the globe have caused massive suffering, misery, and the spread of a massive inequalities in wealth, power, and income. Moreover, increasingly, we are witnessing a number of people who are committing suicide because they have lost their pensions, jobs and dignity.

We see the attack on the welfare state; we see the privatization of public services, the dismantling of the connection between private issues and public problems, the selling off of state functions, deregulations, an unchecked emphasis on self-interest, the refusal to tax the rich, and really the redistribution of wealth from the middle and working classes to the ruling class, the elite class, what the Occupy movement called the one percent. It really has created a very bleak emotional and economic landscape for the 99 percent of the population throughout the world."

 

No Recovery: Longest Sustained Fall In UK Real Wages In Recorded History

Why is there no sustainable recovery?

Because of the policy errors of the West to save the corrupt financial system, but abandon the people whom 'the system' is intended to serve.

You may read the story about why the Bank of England is likely to keep interest rates low, which accompanies this graph, in the Financial Times.

Performance of a Number of Global Stock Exchanges Year-To-Date

Except for a few Asian countries, and special situations not pictured perhaps, it looks like a global slump from here.

There are still a select few unbroken housing bubbles out there that may find some adjustment in a future capital crisis.  Canada and Australia come to mind, among others.

Despite the billions of taxpayer funds poured into them, some if not quite a few of the troubled multinational Banks are still in trouble, and a few may be teetering.

Does anyone who is well informed not recognize that the policy errors of the Central Banks and their political cronies have failed to foster a sustainable recovery after five long years of enormous bank subsidies and public misery?

And the fruits of this selfish foolishness may likely be another crisis that is even more decisive?

The Banks must be restrained, and the financial system reformed, with balance restored to the economy, before there can be any sustainable recovery.


Related:  The One Percent's Plots To Overthrow Democracy

GolemXIV: Trouble In Bankland

In the US:

• Home Equity Loans (HELOCs) are up 20% this year. 15% of all home loans originated are home equity extraction loans.
• People are taking equity out of their homes in the reigniting housing bubble, but adding to their bank debt.
• Student loans now total $1.2 Trillion.
• Nearly 35% of student loans [I believe David inadvertently says HELOC at one point] given to people under 30 are now 90 days delinquent.
• There are $924 Billion in auto loans, with nearly one third being subprime.
• It will not take much of a downturn for the HELOCs to go underwater.
• Jobs for those servicing new student loans are often low paid and hard to find and could become scarcer prompting more defaults.

In Europe:

• Royal Bank of Scotland (RBS) has now lost ALL of the £46 Billion bailout from taxpayers
• Espirito Santo recently went bankrupt AFTER recently passing the ECB stress test.
• Not only the bank, but the entire Espirito Santo group went bankrupt, after the bank sold their associated debt to unsuspecting clients.
• This certainly does not inspire confidence in any of the ECB testing of the Banks. We would have no confidence in an agency that tested cars with these kinds of results.
• There were fifteen other EU banks that passed in the weak manner of Espirito Santo.
• The Spanish/Italian/Greek Banks were allowed to count tax credits from the government as assets.
• What if China decides to support its domestic coal production by assessing a 3 to 6 percent surcharge on imported Australian coal? It would dampen exports and GDP.
• Australia's huge housing bubble is counting on 8 to 12 percent house increase NEXT year.

If things go south, the ECB,  Fed, and other Central Banks will have to engage in another enormous bailout.





Source: GolemXIV

Bill Moyers with Bill Black: Chasing Mice While Lions Roam the Campsite

"The Clinton, Bush and Obama administrations all could have prevented the financial meltdown...We have created the incentive structures that are going to produce a much larger disaster.”

William K. Black

The big thieves hang the little ones.

Mr. Cohan Responds On His Silver Rigging Exposé - Two US National Publications Refused the Story

"We run carelessly to the precipice, after we have put up a façade to prevent ourselves from seeing it.”

Blaise Pascal

This is starting to make more sense. 

Apparently Mr. William Cohan, a highly respected journalist, did look at all the relevant information he had been provided, and decided to write a story about rigging in the silver markets.

It was submitted and refused by at least two US publications which refused to run it.

Based on past history, one might assume the two national publications that refused to publish it were on the order of The New York Times, and perhaps Bloomberg News or even possibly Forbes.

The actual reasons that they gave for refusing to publish the story are not stated. One can assume they were not sufficient for Mr. Cohan to decide to take his name off of it in his professional judgement, so we can only surmise. 

So we cannot tell if this was editorial scruples, a failure in fact checking, or just good old fashioned minding of one's place.

Insiders never speak ill of insiders.

Bill was good with publishing the piece at ZeroHedge with his name on it.  So he apparently still had confidence in what he had written. 

 

That speaks volumes. 

At that point the whistleblowing parties, if one might call them that, deferred, feeling perhaps that printing something like this on the web alone, even on a large and widely read site, would relegate it to something easily dismissible by the status quo.  The Very Serious Players choose to read only properly vetted, fully credible and approved mainstream sources.

I am being a bit sarcastic, but not so much.  The thought leaders and ruling class in the US are, alas, out of touch almost without regard to their origins. And one does not have to think too hard about it to discover why.  They only read the right publications, watch the right shows, talk to the right people, say the right things, and think the right thoughts.

They live in virtual palaces and bubbles of ease and influence.  To borrow a phrase from one of their less pliant pets, when they go out amongst the common people, it often resembles Prince Charles on a royal visit to Papua, New Guinea.   As George Orwell noted in his diaries, 'apparently nothing will ever teach these people that the other 99% of the population exists.'  

They exist, they just don't matter in the halls of power anymore.

I might have suggested some publishing options a little 'out of the box' like The Guardian or Der Spiegel.  Choosing publications that might be less beholden to the New York financial powers seems as though it could be a more fruitful course of action.  South China Morning Post, or even the Asia Times?  Radio Free America?

So there you have it. We have a story. And the mainstream media refuses to publish it. And there is some wrangling about where and when it might achieve adequate exposure to do some good.

To:  addressees

Thank you all for writing me regarding Andrew Maguire's story of alleged "manipulation" in the silver market. As you may know, I was approached 11 months ago by a PR representative of Mr. Maguire's who wanted to introduce me to Andrew and to his attorney Gordon Schnell, at Constantine Cannon, in New York. I found what Andrew had to say very interesting, especially so in light of a piece I had written in the New York Times about the silver market three years ago.  A Conspiracy With a Silver Lining

I wrote up the story and submitted it to a national publication in the United States, which decided not to publish it. I then tried another, national financial publication, which also decided not to publish it. I then abandoned hope that the story would be published.

About a month ago, Ned Naylor-Leyland contacted me and suggested that Zero Hedge might publish the story. I thought that would be a fine idea.

Unfortunately, Mr. Schnell did not like the idea of Zero Hedge, nor apparently did his clients. They also declined to approve the use of key facts and key quotations that I felt needed to be included in the story to give it credibility. Part of my agreement with them was that they would be given quote approval and without their approval, I could not use their quotations or their information.

They did not approve. At that point, without their cooperation, I did not feel the piece could be published. I explained that to Mr. Naylor-Leyland but he didn't seem much interested in those facts and then went on to encourage the publication of the piece to which you are all responding.

All of which is to say, you are directing your passion to the wrong person. If you want the piece published, you need to reach out to Mr. Maguire and Mr. Schnell.

Thank you for your interest and your passion on this topic.

William D. Cohan

Related:  Ned Naylor-Leyland Suggests Media Overhanging an Exposé of Rigging in the Silver Markets

A Broken Economic System In One Picture

A truly bipartisan effort.

Such a parcel of rogues in a nation.

h/t Neil Irwin, You Can't Feed a Family GDP

David Cay Johnston: The Perils of Our Growing Inequality

“Wherever there is great property there is great inequality. For one very rich man there must be at least five hundred poor, and the affluence of the few supposes the indigence of the many."

Adam Smith, The Wealth of Nations

This helps to explain why there will be no sustainable recovery. 

It is a matter of un-official policy.

David Cay Johnston: The Monopolists Rule

“You will even read about an insurance company owned by one of America’s most admired billionaires [Buffett] that asked a paralyzed man to die because the cost of keeping him alive was cutting into the insurer’s profits.”

“No other modern country gives corporations the unfettered power found in America to gouge customers, shortchange workers and erect barriers to fair play. A big reason is that so little of the news, which informs us about the world around us, addresses the private, government-approved mechanisms by which price gouging is employed to redistribute income upward.”

David Cay Johnston

 

Third World America.

Real News: Deep State, Big Lies, Organized Plunder, and the Power of the Moneyed Interests

A new set of interesting conversations with David Cay Johnston about his work as an investigative reporter and writer on the Real News.

This is what the one percent do not wish you to hear or understand. You will not hear this on any prime time news programs. Not even Public Broadcasting will touch this story.

This is how easily the system is manipulated, by design, for those who have the money, means, and the connections. I think Johnston explains it much better than most.

In the upcoming elections, and especially the Presidential elections of 2016, it is highly unlikely that either major party candidate will not be fully vetted and approved by the moneyed interests as a corporate brand, no matter what big time wrestling theatrics are staged to portray them as 'different' and get people worked up about it. This is not a choice; this is just sad.

Try to listen to what Johnston says without knee jerk reactions from the slogans that have been inserted by endless repetition into your thinking by corporate news outlets and think tanks. Try to hear the facts as they are.

The 'deep state' is at the heart of the partnership between private power and the government.

Part 3


Part 4


Part 1


Part 2

Chris Hedges: The Rise of the Corporate Class and the Triumph of Managerial Malfeasance

“Antidemocracy, executive predominance, and elite rule are basic elements of inverted totalitarianism. Antidemocracy does not take the form of overt attacks upon the idea of government by the people. Instead, politically it means encouraging what I have earlier dubbed civic demobilization, conditioning an electorate to being aroused for a brief spell, controlling its attention span, and then encouraging distraction or apathy. The intense pace of work and the extended working day, combined with job insecurity, is a formula for political demobilization, for privatizing the citizenry.

It works indirectly. Citizens are encouraged to distrust their government and politicians; to concentrate upon their own interests; to begrudge their taxes; and to exchange active involvement for symbolic gratifications of patriotism, collective self-righteousness, and military prowess. Above all, depoliticization is promoted through society’s being enveloped in an atmosphere of collective fear and of individual powerlessness: fear of terrorists, loss of jobs, the uncertainties of pension plans, soaring health costs, and rising educational expenses.”

Sheldon S. Wolin, Democracy Incorporated

"Our corporate oligarchs are harvesting the nation, grabbing as much as they can, as fast as they can, in the inevitable descent."

 Chris Hedges

 

The Anti-Humanism of the New American Century

"Plunderers of the world, when nothing remains on the lands to which they have laid waste by wanton thievery, they search out across the seas. The wealth of another region excites their greed; and if it is weak, their lust for power as well.

Nothing from the rising to the setting of the sun is enough for them. Among all others only they are compelled to attack the poor as well as the rich. Robbery, rape, and slaughter they falsely call empire; and where they make a desert, they call it peace."

Tacitus, Agricola

The fully financialized recovery is not sustainable. In fact, it closely resembles a Ponzi scheme.

The Fed creates enormous amounts of money, which it carefully feeds into the financial system through its Banks and their associated Funds. This is a 'trickle down approach' to monetary stimulus.

The monies created are directed primarily towards the same types of activities that have been dominant in the financial system for the previous ten years at least: financial speculation, building of monopolies, acquisition of assets for repressive exploitation through rents, and the transfer of wealth to the top one percent through largely non-productive activities.

The result can be seen in the continuing plunge of the velocity of money, which is a measure of how much actual GDP related activity is being generated by the additions of monetary growth. Most of the growth we are seeing is only on paper and in accounting gimmicks, and not in real advances and improvements in the standards of living and infrastructure.

 In fact, one can make a good case that all those things that are dependent on longer term planning are suffering greatly, and even being 'hollowed out' for the sake of short term greed.

This short term mentality that has been engineered into our social, economic, and legal structures is going to bring about a cycle of booms and busts. We have seen two busts thus far, and are working on a third. And the third time might be the charm.

The forces of the anti-human are growing stronger and more strident. They are hungrier for power, and having laid waste to some areas, move on to others in a cycle of perpetual war and acquisition until exhaustion or collapse. The only imperative these new Lords of the World have is 'more.' 

It is only in this context that some of the recent decisions that are being made and actions undertaken can be fully understood.

The Banks must be restrained, and the financial system reformed, with balance restored to the economy, before there can be any sustainable recovery.

"Five years after the official end of the Great Recession, corporate profits are high, and the stock market is booming. Yet most Americans are not sharing in the recovery. While the top 0.1% of income recipients—which include most of the highest-ranking corporate executives—reap almost all the income gains, good jobs keep disappearing, and new employment opportunities tend to be insecure and underpaid. Corporate profitability is not translating into widespread economic prosperity.

The allocation of corporate profits to stock buybacks deserves much of the blame. Consider the 449 companies in the S&P 500 index that were publicly listed from 2003 through 2012. During that period those companies used 54% of their earnings—a total of $2.4 trillion—to buy back their own stock, almost all through purchases on the open market. Dividends absorbed an additional 37% of their earnings. That left very little for investments in productive capabilities or higher incomes for employees."

William Lazonick, Profits Without Prosperity, Harvard Business Review Sept. 2014

h/t Wall Street On Parade

A Tale of Two Markets: One for Wealthy Insiders, And Another For the Rest of Us

"We run carelessly to the precipice after we have put up a façade to prevent ourselves from seeing it.”

Blaise Pascal
 

Here is a brief excerpt from an article today by the amazing team of Pam and Russ Martens at Wall Street On Parade titled, Are U.S. Markets Liquid and Deep or Rigged and Broken? I suggest you read the entire article when you have the opportunity as this is just a snippet.

"...the SEC which oversees stock exchanges has allowed both the New York Stock Exchange and Nasdaq to create a bifurcated market. The unsophisticated investor is given trading data on which to base trading decisions on a slow data feed called the Securities Information Processor or SIP. The SIP is not only slow in getting the data to the technology-challenged investor, but it has limited data.

For the rich and powerful on Wall Street who can afford massive fees, there is another data feed offered by the exchanges called the Direct Feed. The Direct Feed data, which has far more useful information, arrives in the hands of High Frequency Traders and Wall Street’s proprietary traders ahead of the arrival of the SIP data. This allows the Direct Feed users to buy a stock on the cheap and sell the stock back to the SIP user at a higher price...

The New York Stock Exchange and Nasdaq, which also have a mandated regulatory role to ensure that their markets are fair and non-discriminatory, have allowed the two-tiered market to exist because they are collecting hundreds of millions of dollars a year selling the SIP to the dumb money and the Direct Feed to the smart money..."

For someone that is not drinking the daily dose of electronic kool aid from the mainstream media, this is a systemic, institutionalized control fraud that inevitably leads to a financial crisis.   And a close survey of the markets today might lead one to observe, 'My God.  These lunatics are going to do it again.'

That is what it is in plain words.   That is what the price discovery of the US, which controls the reserve currency of the world and sets many of its key prices, is based upon.   This is not some rogue trader, or anomalous abuse.  This is fraud that is deeply woven into the very fabric of the system, and is widely tolerated with a self-serving wink and a nod.

For example, the privately held London Metals Exchange was dismissed as a defendant in the aluminum price fixing case today because it is immune from US prosecution as 'an organ of the UK government.'  That is quite an admission, and some organ.   Droit du seigneur.  Reminds one of the motive for dismissal insinuated by the Barrick motion in the Blanchard gold manipulation suit.

What is it going to take to wake people up?  What markets are left that have not been exposed as deeply rigged at their core?

A big part of the rest of the world isn't buying it anymore. And that is taking us into some very deep, dark, and uncharted waters. 

Bill Black on the Rule of Predatory Finance Over Argentina

As you know I think that this ruling by the Supreme Court, written by Antonin Scalia, which essentially puts the Argentine people and the other creditors at the mercy of the demands of a few vulture funds, may prove to be a watershed, or perhaps trigger, event in the excesses of crony capitalism and the Empire of the Dollar. 

 

The blowback from this action on foreign assets held in the US, and on US corporate assets held overseas, may be profound.  

 

The BRICs will be having their annual summit in mid-July.   And the US has certainly given them something to think about,  set at least a part of their agenda,  and given them a common cause of concerns, over the past four or five months.   I see no reason for optimism that a ruling elite, grown in-bred and self-absorbed in its hubris, will do anything different in its self-serving policies.

 

If there ever was a time for enlightened leadership to rise to the occasion it is now.  And in looking over the current crop of puffed-up princes and predators, we can see none.

 

Gold Daily and Silver Weekly Charts - The Emperor Wears Nada - Blood on the Pampas

Gold and silver pulled back a bit today after an exceptionally good week.  They were higher most of yesterday evening, if one could distract themselves from the season finale of Game of Thrones. 

I really need to go back and reread the first five books of the series.  I remember the highlights, but keep forgetting some of the details.  Its been about five years since I read them.  And Lord knows when G. R. R. Martin will get around to finishing volumes six and seven. 

Martin is a great story teller, and certainly has found his voice with this particular series.  I have read his Dunk and Egg series, which should be a good 'fix' for frustrated Martin aficionados.    But most of his other things like the science fiction were meh.  I have not read his vampire story Fevre Dream yet, which is set in the 19th century on the Mississippi River, but it did not sound inviting.  I think what is intriguing is the expanse of the world he creates in A Song of Ice and Fire, and the highly engaging details and characters.

As you know this is an FOMC meeting week, so we will have to see how well the precious metals hold their levels. I would certainly like to see silver take out 20, but that may or may not be in the cards.

 

"The Supreme Court said today it would not hear Argentina's case against hedge fund creditors, and Argentina's stock market got killed on the news.

Argentina's Merval Index, a price-weighted index designed to reflect the performance of Argentine listed companies, fell 12%."

Business Insider, Argentina's Stock Market Crashed Today

In case you missed it, the Merval stock index (Argentina) crashed today.  I mentioned it in the stock market commentary below.  This was courtesy of the US Supreme Court's refusal to hear the case that is forcing that government's hand in its dealing with some funds who refused to negotiate the debt, demanding full payment. 

 

This sets up the government for a potential default since the lower US court had ruled it could repay no debts without first settling with funds who have purchased Argentine debt and have refused to enter into the restructuring, instead demanding full payment.   The world seems to have viewed this market drop as a secular event.  I find it interesting that the US Courts have precedence here.

Some additional ounces of gold were 'stopped' on Friday, but there continues to be little movement in the Comex warehouses, which seem to be like the Hotel California. Bullion can check in but it never seems to leave.

Actually this is not all that hard to understand, if you keep in mind that the US markets are where the elite meet to cheat, and that actually BUYING bullion and taking delivery in any serious amounts happens elsewhere. What is more surprising is how the LBMA is becoming the same sort of market with the movement of precious metal action to the East.

I have almost reached the conclusion that there will be no reform until something unfortunate and unavoidable happens to wake people up.  I continue to hope not, but it does seem to be in the cards.   People are growing hungry for justice.

Perhaps we will see a Stannis Baratheon riding down the wildlings of Wall Street someday.  I am sorry to say that it rarely happens in real life as it does in fictional worlds.  Most of the time the would be savior turns out to be a betrayer, a type of Judas goat. 

But as with Jon Snow, there are quite a few who 'would like to fight for the side that fights for the living.'  And one can hope that they may eventually prevail with the right kind of encouragement and assistance.  After all, the real fight is not among the power hungry gamesters at King's Landing, but with the Night's Watch on the Wall. 

Winter is coming.

Have a pleasant evening.

Financial Crisis in America: If Only the King Knew!

Signs of Decay

1. Internal corruption
2. Imperial overreach
3. Inability to reform.
   

Harvard Law Review
Incentives and Ideology
By James Kwak
May 20, 2014

“'If only the King knew!', we cried a thousand times from the depths of our abyss.” Cahiers de doléances de Cahors, 1789

In pre-Revolutionary France, common people would often say of their problems, “If only the King knew . . . .” Whatever evils they suffered at the hand of their government must be due to the king’s ministers and officials, for the king himself could not be at fault.

But the king knew exactly what was going on. As Levitin shows, our financial regulators were and remain deeply enmeshed in a complex political environment. At the margin, they have the discretion to do favors for the industry or for specific institutions (such as the OTS backdating a capital infusion by IndyMac to make it seem well capitalized when it actually wasn’t). But major regulatory decisions, such as turning a blind eye to derivatives or bailing out banks, are made by the political system as a whole...

More generally, we can’t blame everything on the bureaucrats. The financial non-regulation that made the 2008 crash possible was the explicit policy of multiple presidential administrations, and some of its most important elements sailed through Congress with bipartisan support. The choice to bail out large banks rather than homeowners was made by the Bush and Obama Administrations.

And Congress passed the Dodd-Frank Act, which largely left in place the regulatory system that had failed so spectacularly, with the Administration lobbying heavily to weaken the most far-reaching reforms. In other words, President Obama knew exactly what was going on — just as President Clinton knew what was going on when he signed the Gramm-Leach-Bliley Act, allowing the consolidation of commercial and investment banking."

Read the entire article in the Harvard Law Review here.

Related:
Credibility Trap: Moyers and Barofsky on Failed Reform and Another Financial Crisis

The Most Destructive Bubbles of All: Corporate Profits Amid Private Poverty

"The money was all appropriated for the top in the hopes that it would trickle down to the needy.

Mr. Hoover didn’t know that money trickled up. Give it to the people at the bottom and the people at the top will have it before night, anyhow. But it will at least have passed through the poor fellow’s hands.”

Will Rogers, St. Petersburg Times, Nov 26, 1932


“Much like Herbert Hoover, Barack Obama is a man attempting to realize a stirring new vision of his society without cutting himself free from the dogmas of the past, without accepting the inevitable conflict. Like Hoover, his is bound to fail.”

Kevin Baker, Barack Hoover Obama: The Best and the Brightest Blow it Again, Harper's


"In regards to the price of commodities, the rise of wages operates as simple interest does, the rise of profit operates like compound interest.

Our merchants and masters complain much of the bad effects of high wages in raising the price and lessening the sale of goods. They say nothing concerning the bad effects of high profits. They are silent with regard to the pernicious effects of their own gains. They complain only of those of other people.”

Adam Smith, The Wealth of Nations


“We Americans are not usually thought to be a submissive people, but of course we are. Why else would we allow our country to be destroyed? Why else would we be rewarding its destroyers? Why else would we all — by proxies we have given to greedy corporations and corrupt politicians — be participating in its destruction?

Most of us are still too sane to piss in our own cistern, but we allow others to do so and we reward them for it. We reward them so well, in fact, that those who piss in our cistern are wealthier than the rest of us."

Wendell Berry


“Trickle-down theory - the less than elegant metaphor that if one feeds the horse enough oats, some will pass through to the road for the sparrows.”

John Kenneth Galbraith


"Fascism is capitalism plus murder."

Upton Sinclair

 

NY Fed Joins War On Whistleblowers To Shield Goldman Sachs From Its Own Examiner

And this sort of egregious behaviour from a 'regulator.'  They argue out of both sides of their mouths whether Goldman is a 'bank' or not, in order to get what they want for...  Goldman.

The Fed is not a government agency, but a privately owned creature of the very Banks whom it is charged to regulate and restrain.

And as we have seen, over and over again, the Fed is not part of the solution, but has become very much a part of the problem in distorting the banking system in favour of a few powerful financial interests.

A Mangled Case of Justice on Wall Street
By Pam Martens
May 8, 2014

On October 10, 2013, bank examiner Carmen Segarra and her attorney, Linda Stengle of Boyertown, Pennsylvania, took on one of the mightiest and interconnected institutions on Wall Street: the Federal Reserve Bank of New York. They relied on the Federal court system, funded by the taxpayer, and a fair and impartial judge to level the playing field. Things got off to a promising start.

Segarra was a bank examiner at the Federal Reserve Bank of New York, a key regulator of Wall Street banks. She charged in her lawsuit that when she turned in a negative assessment of Goldman Sachs, she was bullied and intimidated by colleagues at the New York Fed to change her findings.

When she refused, she was terminated from her job in retaliation and escorted from the Fed premises, according to her lawsuit...

Read the entire story here.

Related: Judge Tosses Lawsuit of Fired NY Fed Examiner

Russell 2000 Small Caps and the Wilshire 5000: In a Stall, Or the Pause That Refreshes the Bull

Bespoke has a recent article pointing out some weakness in the small caps.

It is interesting to see that the broad lower end of the equity market is stalling here, with a negative return year to date. This is what we see in the Russell 2000 small caps index. It has been flirting with this support level for some time, and is testing its 200 DMA once again.

This *could* be distribution, or profit-taking if you will, but absent determined selling on volume, the markets can continue to drift with an upward bias for some time, given the Fed's bubble of liquidity going right to the banks, and thereby to Wall Street.

And we get a broader perspective from the Wilshire 5000, which is effectively flat for the year, and is oscillating round its 50 DMA.

The SP 500 is the locus of market support, some might say propping, and if there is weakness it may first appear in sector specific areas and the broader markets.

But not so yet, even though we are seeing weakness, and the volumes are thin, especially if one discounts HFT antics. 

The market is vulnerable to an exogenous shock, lacking firm underpinnings from the real economy, but absent a shock the vicious cycle of wealth extraction through the printing of money and paper asset inflation seems to be operating quite efficiently for the gangster class.

"We must make our choice. We may have democracy, or we may have wealth concentrated in the hands of a few, but we can't have both."

Louis D. Brandeis

And this aggregation of power and wealth will likely continue until the next financial crisis.  Wealth and power are being steadily transferred, as a matter of de facto policy, from the many to a select few in the rise of a new, transnational oligarchy.

This is the Anglo-American way, which has been widely adopted both at home and abroad, through manipulation, intrusion, intimidation, and intervention.

Follow the Money: The Failure of Corporately Owned Journalism in a Crony Capitalist System

"I have been told by multiple members of the media that JP Morgan Chase has called them and stated that if their media outlet has me on television again, that JP Morgan Chase will pull their advertising from the offending network."

James Koutoulas, Founder of Commodity Customer Coalition and advocate for victims of MF Global

"The crisis blew into public view last November when The New York Times, followed by the Financial Times and others, reported that a big, new enterprise project from Bloomberg, said to have documented an extensive web of corrupt ties between one of China’s wealthiest businessmen and elite politicians, had been spiked at an unusually late stage in the editing process.

The reported spike came after an extensively footnoted version of the story had been fact-checked and pored over by company lawyers, and after members of the reporting team had been praised internally for yet more stellar work. The Times reported that Winkler, in a conference call with reporters, defended the decision not to publish the story by likening the situation to the need for self-censorship by foreign bureaus in Nazi Germany to preserve their ability to continue reporting there.

That reasoning was controversial enough, but a Bloomberg executive would later let slip a motive that was even more problematic...The defining moment, however, the one that has dealt the deepest shock to Bloomberg and may affect it for years, was a widely reported speech by the company’s chairman, Peter T. Grauer, who in March said, in effect, that Bloomberg had gotten carried away with its investigative journalism in China to the detriment of its true vocation: selling computerized terminals that provide financial information.

“We have about 50 journalists in the market, primarily writing stories about the local business and economic environment,” Grauer said in answer to a questioner after a speech at the Asia Society in Hong Kong. “You’re all aware that every once in a while we wander a little bit away from that and write stories that we probably may have kind of rethought—should have rethought.”

Howard W. French, Bloomberg's Folly, Columbia Journalism Review, May 1, 2014

Read the entire story here.