Articles On BlackRock The Federal Reserve COVID-19 PPP Bailouts and the Dollar

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Brief Interoduction to Articles

Mentally, try wrapping your head around the Trillions of dollars of public money being given to 737 Max Crash Boeing, General Motors, AIG, et al. Trlllions of dollars is unimaginable, sort of.

George H.W. Bush 1992: Debt $4.351 trillion (at fiscal end) 64.0% of GDP. The debt, then, $4.351 Trillion... If you made an interest only (no principle) payment, you would need to pay two Porsche 944s (then) every one second, of every minute, of every day, forever (because the two 944s are only paying the interest).

Now on to Trump 2020: $24.95 trillion National Debt. As of May 1, 2020 federal debt held by the public was $19.05 trillion and intragovernmental holdings were $5.9 trillion, for a total national debt of $24.95 trillion. To pay the interest on America's National Debt, you would have to pay 11-1/2 Porche Targa T's every second of every minute, hour, day, week, ad infinitum - because it is only interest payments. 11-1/2 Porsche Targas per second in loan interest, to pay for the government giving public money to "too big to flail" private businesses... It may not compute to the penny, but what they have done is create Trillionaires out of Coronavirus.

Page Posted 19 Aug 2020 - Articles are not in any particular order - This Page Editor Believes the 3-6 Largest (AI) Search Engines have De-Listed Dozens or Hundreds, Maybe More of Articles Like These... Any reference to Russia and China working as a team to kill the almighty dollar seem to disappear before overnight... This page was created via alternative Search Engines, to give the reader an alternative list of articles.

As of 2020, a Porsche 911 Targa 4 costs $110,300 and 11.5 of them per second costs $1,268,450. One minutes worth of National Debt (interest only) costs $76,107,000. One hour of National Debt interest costs $4,566,420,000 or about $4.6 Billion. The interest on the National Debt keeps going up, because the Fed Cartel keeps handing out free money to their cronies. This drain on the the economy, $4.6 Billion per hour, is dragging the overall economy down. The Banksters keep pulling out curtains, widgets, tricks and magic spells to hide the dirty secret of the debt interest drain, such as Quantitative Easing.

$4.5 trillion of quantitative easing, and $2 trillion created under the Trump CARES Act is not used to pay National Debt or to pay back loan principle, rather the $6.5 Trillion is used to keep Wall Street from tanking. The amount of fortune needed postpone Wall Street from tanking is two Porsche 911 Targa 4s per second, or $220,600 per second, every second of every day, month and year. The Bankster Crony Cartel families literally burn wealth.

 

From http://bandamaestroasaro.it/jztn/fed-bailout.html by Banda Asaro. This article is a rough draft, the articles after it polished essays. The draft contains info not in the polished essays (and vice versa)
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Fed Bailout

Businesses need a $2 trillion bailout fund to avoid a possible 'global depression,' says Guggenheim's Minerd Published: March 18, 2020 at 9:56 a. Wisconsin lawmakers urge no fed 'bailout' money for Illinois delegation to oppose using any federal coronavirus relief package money to help bail out Illinois and other states with a. Political Battle Over USPS Future, Fed Bailout Continues as Mail Declines June 1, 2020 May 12, 2020 by ptimesadmin2015 While the U. As chains like Potbelly's and Ruth's Chris secure $10 million loans, smaller restaurants stand to be crowded out. Bailout: A bailout is a situation in which a business, an individual or a government offers money to a failing business to prevent the consequences that arise from the business's downfall.

 

This is a lightly edited transcript of their conversation. 9 percent is comparable to red states Texas' 32. Washington has two main economic tools: the Federal Reserve's power over private debt and stimulus. State Bailouts: ‘Beyond Galling,’ ‘Shameless,’ Too. 9 billion under the new CARES Act and about $9. An Overview of Recent Bank Bailouts in the U. Less than two months ago Boeing Co. Until this morning, this was limited to Treasury securities, agency debt, and residential MBS backed by Ginnie Mae (US government agency) and the GSEs, Freddie Mac and Fannie Mae. Bailouts for some of the hardest hit (and/or most Donald Trump-adjacent) industries, paid sick leave, and billions in loans to small businesses are among the many other measures under consideration. 4 billion invested, earning a $15. The Main Street New Loan Facility will support up to $600 billion in loans to mid-size businesses — defined as less than 10,000 employees or $2. Department of Energy to declare an emergency that would secure higher prices for its money-losing coal and nuclear power plants, claiming that their closure would. , which is a federal agency with its Chairman and Board appointed by.

 

The PPP was created to help small businesses stay afloat in the midst of massive economic turmoil thanks to the coronavirus pandemic that saw millions of layoffs across the country. Published in volume 110, issue 3, pages 860-88 of American Economic Review, March 2020, Abstract: Expectations of transfers by central governments incentivize overborrowing by local governments. Treasury to guard against. The Federal Reserve’s weekly balance sheet data release, known as the H. Coronavirus COVID-19 Crisis Bailouts for Large, Public Companies. 5 billion government bailout of Chrysler and ties together. The Fed's Backroom Bailout Policy: Reportedly more than $2 trillion in loans and guarantees without a timely public record, expanding its regulatory powers despite a history of malfeasance and, since October 2008, rewarding banks for holding their surging reserves rather than lending. But whatever levers of influence they are pulling, hospitals big and small across the nation say they are shortchanged by the federal bailout as they face both a health crisis and an economic one.

 

2 trillion coronavirus rescue package as the pandemic devastates the nation's economy, sickens more than 103,000 Americans and killed nearly 1,700 others. But others will be shocked or angry. That's a half-trillion-dollar bailout for the housing market. And while the Fed "invented a new bazooka," elected officials will have to prepare bailouts and get cash into peoples' hands to prevent a recession from getting even deeper, wrote Diane. Following uproar about bailout decisions during the 2008 financial crisis, the Dodd-Frank Wall Street Reform and Consumer Protection Act took away powers from the Federal Reserve that allowed it. The Postal Service’s finances are a disaster. economy has come a long way since the low point of the financial crisis of 2009-2008. Carnival Cruise Line, after "missing out" on the original set of big business bailouts, is going to get some of that American taxpayer money. Many energy producers have sought federal bailout, Dallas Fed survey says. Large stack of money (Getty Images) The U. Howard Schneider The Fed in the 2007 to 2009 crisis did lend against ostensibly risky securities backed by assets such as car loans or. Obscure interest rate markets were tightening up.

 

Have you taken a look at the new federal bailout bill put together by Nancy Pelosi and her fun friends in the House? If passed by Congress, the three trillion dollar spending spree would be the largest piece of financial legislation in US history. An interesting piece in the WSJ appears to be highlighting the role of the Fed in picking winners and losers of the coronavirus epidemic. CT May 9, 2020 | Updated 9:52 a. The Fed's decision to use its near limitless balance sheet to purchase corporate bonds improved liquidity so much that it was a game changer for the company, according to people with knowledge. Princeton University will receive the least in bailout funds among the Ivy League schools. Below is a chart of the composition of the Federal Reserve's balance sheet, in billions of dollars. State Bailouts: 'Beyond Galling,' 'Shameless,' Too. The Fed had another peculiar relationship with JPMorgan Chase. Source: rigged game. 2 billion budget deficit for this year, Gov. 9 billion (very modest compared to Germany’s investment). Andrew Biggs, a pension expert at the American Enterprise Institute, told the Washington Free Beacon that a bailout for Illinois could break the dam of federal funding: "If Illinois got money. Newsom, legislators reach California budget deal that counts on federal bailout Alexei Koseff June 22, 2020

 

Updated: June 22, 2020 6:06 p. Wisconsin lawmakers urge no fed 'bailout' money for Illinois delegation to oppose using any federal coronavirus relief package money to help bail out Illinois and other states with a. MTA seeks $4 billion federal bailout as mass transit ridership plummets during coronavirus pandemic. According to a report one firm provided Fortune, overnight rates have breached the upper Fed rate an average of once a month since 2018 and spikes have grown larger over time. At the same time, thousands of students around the country have already demanded pro-rated refunds for the spring semester as classes have shifted online. Democrats who hold the majority in the House of Representatives unveiled a $3 trillion stimulus bill Tuesday that would give nearly $1 billion to state and local governments. Boeing is strong-arming the federal government for a bailout by threatening layoffs and bankruptcies in its extensive supply chain. , either via a loan or by buying into a do-or-die debt sale that the company made earlier this month. Illinois Senate Democrats are asking the federal government for more than $41 billion in federal aid — about a quarter of it for a pension fund bailout — to keep the state financially afloat as the coronavirus pandemic continues to slash revenues across the board. Federal bailouts of state governments whose politicians have made bad decisions undercuts that small amount of accountability. Twelve years later, virtually the same course of events is taking place. Look at that. He added that Trump is “a pure hypocrite given how much money he’s put in the hands of the corporations and the wealthy already,” citing the $58 billion federal bailout for the airline. This construction resembles a dollar loan to the ECB at about 0. A federal bailout would prevent needed reforms," Greszler said. 6 billion as of February 2019, a figure that includes money paid back by bailed-out companies as well as revenue from dividends, loan interest, warrants, and other proceeds.

 

The state has requested a bailout package of $41. This potential bailout means blue states won’t end the lockdowns quickly. Fed, facing pressure, commits to disclose monthly who's getting bailouts That includes the names of participants, how much they borrowed and at what rate, and the overall costs, revenue and fees. Boeing is strong-arming the federal government for a bailout by threatening layoffs and bankruptcies in its extensive supply chain. Democrats in Congress have made bailouts for state and local governments a major priority for the next round of coronavirus stimulus, even allowing a major small business loan program to run dry as. Fed buys assets directly. 24, More than half of the 160 energy executives surveyed asked for federal aid, 89% got help, with most seeking. The Federal Reserve tapped BlackRock Inc. Congress slams Fed for favoritism in bond-buying bailout The Fed created programs during the pandemic to buy corporate bonds and other securities to ensure that credit keeps flowing in the. By Terry Nguyen Mar 19, 2020, 12:30pm EDT Share this story.

 

Other rules prohibit companies that receive federal bailouts from engaging in stock buybacks, bonuses and other measures to enrich their executives, but Mnuchin has the authority to waive all such. An Austin-area congressman who ranks as one of the wealthiest members of Congress said that the car dealership he owns won a potentially forgivable loan from the federal government’s coronavirus. 3 trillion coronavirus bailout, revealing it will purchase even recently-downgraded junk bonds in the quest to jump-start the economy, amid worries the measure will do nothing for Main Street. Facebook Twitter Email LinkedIn Reddit Pinterest. Wisconsin lawmakers urge no fed ‘bailout’ money for Illinois delegation to oppose using any federal coronavirus relief package money to help bail out Illinois and other states with a. They include, for Illinois, approximately $4. Newsom, legislators reach California budget deal that counts on federal bailout Alexei Koseff June 22, 2020 Updated: June 22, 2020 6:06 p. These were radical enough, but still confined to the finance version of safe sex: buying investment grade debt, U. The record-breaking number of Americans filing for unemployment benefits suggests the current economic crisis — layered on top of a health crisis. As the oil price war continues to rage on, it seems nothing can stop the carnage, not even a $1. Home / COVID-19 / No junk debt is too risky: how Fed’s bailout changed everything This July 31, 2019, photo shows the Federal Reserve Building in Washington. r/BAILOUT: Find bank, business, city, state and country financial bailout news from around the world. corporations — and it. 1 billion, will receive $2. (Please do not mainline Lysol. Court of Federal Claims Judge Thomas Wheeler, who ruled in Junethat the Treasury Department’s $87 billion bailout of AIG. The public face of the bailout was the Troubled Asset Relief Program (TARP).

 

The state will almost certainly have to bear the brunt of the burden of balancing its budget with far fewer revenues. Bailout payments aimed at relief for farmers from the impacts of President Trump’s trade war and the COVID-19 pandemic likely pushed 2019 federal farm spending beyond subsidy caps set by an international trade agreement, potentially inviting retaliation from trading partners. 86 trillion of the Fed's $7 trillion balance sheet is mortgage-backed securities. MarketWatch reported last week that several for-profit colleges and universities could receive $1 billion in federal bailout money as a result of the Chinese virus pandemic. Newsom, legislators reach California budget deal that counts on federal bailout Alexei Koseff June 22, 2020 Updated: June 22, 2020 6:06 p. This is unprecedented. had spent in World War I ($32 billion estimated). “Calls for even more federal bailouts for states should be rejected. Surgery Partners, the providers’ parent company whose. The Federal Reserve’s weekly balance sheet data release, known as the H. First, the Federal Reserve Board in Washington, D. business Airlines. 4 billion in federal money descending on Palmetto State government – a tab which obviously doesn ’t include the stimulus checks mailed to individual South Carolinians. Howard Schneider The Fed in the 2007 to 2009 crisis did lend against ostensibly risky securities backed by assets such as car loans or. The federal buck won't stop here. The Fed and Treasury made virtually unlimited funds, $182 billion in all, available to AIG so that it could make payments.

 

They are the most dependent on public employee campaign contributions to keep the political elite in power; Two Cops Were Given Qualified Immunity After Allegedly Stealing $225,000. The federal CARES Act includes a stronger moratorium on evictions and bans late fees, but it only applies to an estimated 28 percent of renters who live in properties that participate in federal assistance programs or are financed with federally backed mortgages — a category into which many renters aren’t sure they fall. 9 billion under the new CARES Act and about $9. First, the Federal Reserve Board in Washington, D. went to Washington, hat in hand, asking for a $60 billion bailout for itself and its suppliers. Washington has two main economic tools: the Federal Reserve's power over private debt and stimulus. Surgery Partners, the providers' parent company whose. Boeing issued a $25 billion bond offering to shore up its finances amid the coronavirus and 737 Max crises instead of pursuing a federal bailout. What is the collateral for the permanent, revolving line of credit?. The Fed is also lending directly to companies. The Fed does this to push up the amount of excess reserves at banks, in order to regain control over the federal funds rate and the repo rates. "Calls for even more federal bailouts for states should be rejected," they add. Phil Murphy and, to a lesser degree, State Senate President Stephen Sweeney, D-Gloucester, seem excited about getting a federal bailout for the state government and its related authorities. The catch is that the aid package hasn't been passed yet. Minneapolis Democratic Mayor Jacob Frey is ordering city officials to begin a wide-ranging query of the damage done to the city’s infrastructure from the race riots that began last week after the death of George Floyd, planning on requesting a federal bailout for the city to repair the damages done by “protestors. As expected, she also threatened cuts to education if the federal government didn't agree to send the state bailout money. In 1998, when the hedge fund Long Term Capital Management blew up, the New York Fed helped organize a $3.

 

Obscure interest rate markets were tightening up. The Fed’s decision to wade into certain high-yield, high risk junk-bond ETFs is one of the more controversial steps taken by Chairman Jerome Powell. " Thursday, May 21, 2020. In a government bailout bill signed into law earlier this week, U. Surgery Partners, the providers’ parent company whose. And the amounts have started to balloon. "Instead, in addition to the current federal support being provided to states, state lawmakers must enact reforms and spending reductions, and take other measures - such as using rainy-day funds - to address state budget challenges, many of which are the result of fiscal mismanagement prior to the COVID. 38 trillion. Democrats in Congress have made bailouts for state and local governments a major priority for the next round of coronavirus stimulus, even allowing a major small business loan program to run dry as. Those programs are the $600 billion Main Street Lending Program (which will extend bridge loans to small and midsize businesses), two programs (worth $500 billion and $250 billion) to purchase. Gretchen Whitmer renewed her call for a federal bailout. Bank-centric bailouts don’t work In recent years, the Fed has been repeatedly urged to raise bank capital requirements through something called a Countercyclical Capital Buffer (CCyB). r/BAILOUT: Find bank, business, city, state and country financial bailout news from around the world. The AGA, along with politicians from some casino-friendly states, had lobbied President Donald Trump about including small casinos with under 500 employees in the federal bailout program. And unlike TARP, no business should be required to take a.

 

The house is expected. Treasury since then. On Friday, the Fed pledged to allow roughly two more weeks of overnight repo transactions, each injecting around $75 billion daily into the economy, the Federal Reserve Bank of New York said in a. law on October 3, 2008, of the $700 billion financial-sector rescue plan is the latest in the long history of U. The only auto maker which did not take federal bailout money was Ford. 8 billion positive return on the Federal Reserve Bank of New York's (FRBNY) loans to AIG; a $1. 5 trillion in non-TARP funds to directly support the mortgage and housing market since. 6 percent and Florida's 32. Appearing on CNBC Monday morning, Cramer reacted to a Wall. The Fed’s own analysis bears this out: In the first three months of the bailout, as taxpayer billions poured in, TARP recipients slowed down lending at a rate more than double that of banks that. It continues to hemorrhage money and routinely reports big losses when the agency announces its financials at the end of each quarter or year. Illinois Senate Democrats are asking the federal government for more than $41 billion in federal aid — about a quarter of it for a pension fund bailout — to keep the state financially afloat as the coronavirus pandemic continues to slash revenues across the board. “Calls for even more federal bailouts for states should be rejected. Editorial of The New York Sun | April 20, 2020. HHS has released new details on the latest payments to hospitals from the. The Fed has implemented a number of programs to support markets this month, establishing a facility to lend to money market funds and securing $10 billion from the U. As calls for a People's Bailout in response to the coronavirus pandemic continue to grow across the United States, a new analysis warns that the country's Big Oil companies "stand to reap yet another billion dollar bailout" thanks to the Federal Reserve's plans to buy up to $750 billion in corporate debt. That's a half-trillion-dollar bailout for the housing market.

 

The country discovered this fact the weekend after Congress approved the bailout when the Fed announced a special lending facility to buy commercial paper ensuring the availability of credit for. Trump’s big oil bailout must be stopped. to shepherd several debt-buying programs on behalf of the U. But a provision for $3bn in government funding to. Postal Service's debt, she said. Turns out Panama-incorporated Carnival Cruise Line got a backdoor multibillion-dollar bailout from the federal reserve Image via Shutterstock. A lengthy investigation into the federal corruption case against Fiat Chrysler and the United Auto Workers details the role of the $12. Editorial: Michigan can't wait for a federal bailout. By Terry Nguyen Mar 19, 2020, 12:30pm EDT Share this story. The American people are not even allowed to know what banks benefited from the Fed's intervention in the repo market, or what plans the Fed is making for future bailouts — even though the people will pay for those bailouts either through increased taxes, debt, or the Federal Reserve's hidden inflation tax when the next crash occurs. Facebook Twitter Email LinkedIn Reddit Pinterest. TIA found that some of these poorly managed states have huge taxpayer burdens, which the organization defines as each taxpayer's share of state bills after the. First, the Federal Reserve Board in Washington, D. That would be among the biggest spending. Following Congress’ latest stimulus/bailout, which was the largest in history, the 2020 federal deficit sits at over $3. 6 trillion, which would exceed the $3. Federal Reserve tries to insulate U. Sharice Davids says she's concerned about well-connected companies getting federal bailouts but she won't say whether she supports the House Democratic plan to bailout McClatchy's pension plan. by Walter Einenkel April 28, 2020.

 

So we have to understand the consequences—first, in terms of this size. by circulation according to Statista last year, is looking for a bailout of its pension fund. Indeed, it affirms the DFA’s Title XI requirement that emergency lending programs provide for “broad-based eligibility. This bailout of the last. The Troubled Asset Relief Program, in which the government purchased equity and warrants in distressed banks as well as in General Motors and AIG. In fact, the Federal Reserve in theory can't buy Carnival Corp. This potential bailout means blue states won’t end the lockdowns quickly. When this and similar multiemployer pension plans fail to meet their pension obligations, the PBGC is supposed to pay a portion of the benefits promised to retired workers. Newsom, legislators reach California budget deal that counts on federal bailout Alexei Koseff June 22, 2020 Updated: June 22, 2020 6:06 p. The largest of the Fed's bailout programs was the Primary Dealer Credit Facility (PDCF) which funneled a total of $8. Update: The bailout did pass, and the money is coming from the Treasury and Federal Reserve. 7 billion from $426. Â Weeks later, on Oct. The Federal Reserve rolled out a $2. In order to conceal the bailouts, the Fed now uses mainly currency swaps. Will Illinois Need a Federal Bailout? By Ike Brannon. Twelve years later, virtually the same course of events is taking place. Mitch McConnell said he's OK with states declaring bankruptcy instead of requesting more federal bailouts-as Dems demand more money for state and local governments in the next coronavirus relief bill. It will lead to more bad decisions. Treasury have disposed of the need for Congressional approval, and have engineered a de facto bailout of Fannie Mae and Freddie Mac, at public expense. Unprecedented Housing Market Rescue.

 

The Fed's efforts fill a new set of gaps in the emerging economic response to the crisis. The Treasury Department has invested about $200 billion in hundreds of banks though its Capital Purchase Plan in an effort to prop up capital and support new lending. In 2009, the federal government spent $13. History of Government Bailouts in the U. The two agencies received bailout funding totaling $190 billion from the federal government and have repaid more than $300 billion to the U. 5-6 minutes The day the prophets of public finance long foretold has come to pass: Illinois has requested a federal bailout of its struggling public-employee retirement plans, which had unfunded liabilities topping $469 billion in 2018, according to a Federal Reserve study. WASHINGTON, D. On Friday, the Fed pledged to allow roughly two more weeks of overnight repo transactions, each injecting around $75 billion daily into the economy, the Federal Reserve Bank of New York said in a. A footnote on the H. Obscure interest rate markets were tightening up. The first top-to-bottom audit of the Federal Reserve uncovered eye-popping new details about how the U. Facebook Twitter Email LinkedIn Reddit Pinterest. The magic number so far — the amount of federal money necessary to protect our nation from COVID-19’s economic devastation — is $1 trillion or more. Following Congress’ latest stimulus/bailout, which was the largest in history, the 2020 federal deficit sits at over $3. Congress slams Fed for favoritism in bond-buying bailout The Fed created programs during the pandemic to buy corporate bonds and other securities to ensure that credit keeps flowing in the. 8 million in bailout funds. WASHINGTON, D. It authorised $700bn (later reduced to $475bn), to buy "trouble assets" from big banks that had made stupid and.

 

The measure is aimed at replenishing a small-business funding package. The Washington State Convention Center (WSCC) announced today that it was seeking $300 million bailout from the federal government to stay afloat. The Treasury and Fed replace the two loans provided to AIG with a $150 billion aid package that includes an infusion of $40 billion from the government's bailout fund. As calls for a People's Bailout in response to the coronavirus pandemic continue to grow across the United States, a new analysis warns that the country's Big Oil companies "stand to reap yet another billion dollar bailout" thanks to the Federal Reserve's plans to buy up to $750 billion in corporate debt. This is unprecedented. It took up Randy Ray at the. If one is alert, it is evident that the Federal Reserve and the U. Boeing said it backs a minimum of $60 billion in public and private liquidity for the "aerospace manufacturing industry" as the coronavirus grounds air travel. "Instead, in addition to the current federal support being provided to states, state lawmakers must enact reforms and spending reductions, and take other measures - such as using rainy-day funds - to address state budget challenges, many of which are the result of fiscal mismanagement prior to the COVID. Large stack of money (Getty Images) The U. WASHINGTON (SBG) — In an abrupt reversal of a policy position the White House staked out last week, President Donald Trump rejected the idea of using a forthcoming federal spending package to. 3 Trillion in Loans to Banks, Corporations Audit reveals the scope of "emergency" loans. But [the states] weren't off by a couple of months, they were off by. "The Federal Reserve is committed to using its full range of tools to support households, businesses, and the U. Democratic Illinois Senate President Don Harmon is asking federal lawmakers to provide more than $41 billion to the state as part of the next coronavirus relief package, including $10 billion. 1 billion, will receive $2. It will lead to more bad decisions. These bailout programs fall into three mechanisms: 1.

 

Despite Fed Chairman Jerome Powell’s reassurances at his press conferences that these programs are to help American. Travel, hotel, and leisure. Wells has been restricted from growing past its 2017 size, about $2 trillion in assets, since early 2018 by the Federal Reserve, as punishment for creating millions of sham customer accounts, amid. The secured loan has terms and conditions designed to protect the interests of the U. Find out what's inside the bailout on the next page. City of Buffalo is budgeting for a $65 million federal bailout. Fed Chair Powell Has Millions Invested with BlackRock, the Firm that Will Manage a $750 Billion Corporate Bond Bailout Program for the Fed. That funding calmed markets by enabling the Fed to inject even more liquidity into the economy through several lending facilities that the Treasury backstopped. Less than two months ago Boeing Co. But Toomey has said the coronavirus represents a different threat , since it represents an external. 5 trillion cash injection from the Fed. Providence received at least $509 million in federal bailout funds. Cities are in trouble too! The president of the Illinois State Senate seeks $40 billion to help the. Appearing on CNBC Monday morning, Cramer reacted to a Wall. calling for privatization and vowing to deny bailout funding unless the agency raises parcel rates by a whopping 400%. The Fed and Treasury made virtually unlimited funds, $182 billion in all, available to AIG so that it could make payments. Lawmakers Are Deciding How To Spend Federal Bailout Money The House Finance Committee doesn’t want state agencies to use federal stimulus dollars if they already have state money that can be. This construction resembles a dollar loan to the ECB at about 0. “And here we. "Instead of pumping money into an irresponsible industry that plays shell games with its. 6 billion in a new Federal Reserve facility to purchase municipal bonds. Previously, only companies with up to 10,000 employees or $2. The Fed is also lending directly to companies. The Fed is providing the money to do it. 5 Trillion Repo Bailout, Expands "Not QE" To QE5 from Zero Hedge After increases in its repo facility twice already this week, from $100billion to $150billion to $175billion per day, and adding added a new 1-month term repo.

 

YOU CAN’T PRINT BITCOIN The New York FED added a whopping $111. State Bailouts: ‘Beyond Galling,’ ‘Shameless,’ Too. Do toll facilities really need any federal funding, let alone $9 billion? On May 21, the International Bridge, Tunnel and Turnpike Association, which represents toll facilities, held a news conference regarding the state of U. If you doubt that the pension issue is central here, consider Illinois's request for a federal bailout, which proposes $10 billion in pension aid but only $1 billion to help provide health care. That explains why the Fed suddenly reversed course Friday morning and allowed mortgage prices to fall sharply, as an emergency measure to relieve the mortgage bankers. President George W. Mike O'Brien May 12, 2020. The Government Accountability Office (GAO), when it released its audit of the Fed's bailout programs of 2007 to 2010 chastised the Fed for failing to document the reasons it was flinging trillions of dollars to Wall Street and foreign banks. Will Illinois Need a Federal Bailout? By Ike Brannon. Altogether, accounting for both the TARP and the Fannie and Freddie bailout, $634B has gone out the door. Federalism will be completely dead at that point and our nation will be one step close to defaulting, creating an economic Armageddon.

 

The “Zero Federal Funding: Helping Catholic Students in Need” campaign will provide financial aid to students while. 2 trillion relief bill (CARES Act) gave a $10 billion loan to the USPS, but that does not solve any underlying problems. Federal Reserve continued its bailout operations today after Treasury Secretary Steven Mnuchin told CNBC that he's in constant communication with Federal Reserve System Chairman Jerome Powell, and "There will be liquidity available—whatever we need to do, whatever. The Fed is also lending directly to companies. business Airlines. The Sanford Medical Center in Fargo alone received $23. If one is alert, it is evident that the Federal Reserve and the U. Federal Reserve tries to insulate U. That would be among the biggest spending. This history of bailouts reveals that the genesis of financial crisis is government policy, be it the mismanagement of monetary policy during the 1930s or the political push to expand homeownership that helped cause the 2000s crisis. 24, More than half of the 160 energy executives surveyed asked for federal aid, 89% got help, with most seeking. Airlines take the bailout money but have to return seats back to the size that fits a normal-sized human. The Anti-Defamation League, a far-left social justice group which advocates for online censorship in the name of “fighting antisemitism,” is pushing for congress to give them a federal bailout due to the coronavirus. 9 billion (very modest compared to Germany’s investment). The catch is that the aid package hasn't been passed yet. — John Sharkman (@JohnSharkman) March 17, 2020. Harvard University will receive $8. CNN contacted the banks that were given the biggest chunks of the bailout: Citigroup, JPMorgan Chase, Wells Fargo and Bank of America. The Fed program, for its part, was designed to be targeted in its scope.

 

Federal Reserve tries to insulate U. A bailout differs from the term bail-in (coined in 2010) under which the bondholders or depositors of global systemically important financial institutions (G-SIFIs) are forced to participate in the recapitalization process, but taxpayers are not. Nonprofit lenders in Maine attempt to fill gaps between federal bailout programs Three community development organizations have SBA-backed loans available for business borrowers. (to read the remainder of this article, please log in below. By Pam Martens and Russ Martens of Wall Street on Parade. Boeing said it backs a minimum of $60 billion in public and private liquidity for the "aerospace manufacturing industry" as the coronavirus grounds air travel. Here is the full statement from the Federal Reserve: - The. The Bonds the Fed Left Behind in Coronavirus Bailout Are Struggling Fast-growing segments of the commercial bond markets are among those kept out of a $100 billion loan fund. 9 billion under the new CARES Act and about $9. Many energy producers have sought federal bailout, Dallas Fed survey says. The 2008 financial crisis devastated Wall Street, Main Street, and the banking industry. A subscription to Gary North's Specific Answers gets you instant access to:. Former Federal Reserve Chairman Paul A. This bailout of the last. In fact, even if JPMorgan is the only bank that fails, the FDIC can only bailout 5 percent of this bank’s deposits, thereby making the FDIC totally irrelevant during a financial crisis. Editorial: Michigan can't wait for a federal bailout. , he backed up this point by saying, "The Fed created 15 trillion dollars in the bailout process. Clearly there must be no other fat to trim in the state budgets if the first thing Democrat governors like Whitmer, Newsom, etc want to cut is education and first responders.

 

Airlines take the bailout money but have to return seats back to the size that fits a normal-sized human. Newsom, legislators reach California budget deal that counts on federal bailout Alexei Koseff June 22, 2020 Updated: June 22, 2020 6:06 p. The Federal Reserve tapped BlackRock Inc. - Today, Congresswoman Rashida Tlaib (D-MI) and Senator Jeff Merkley (D-OR) led a bicameral letter to Federal Reserve Board Chairman Jerome Powell, with 45 of their colleagues, opposing the Fed's expansion of the Main Street Lending Program to companies within the oil and gas industry. Bush signed the bailout plan into law Oct. Here's an economic free-association test. didn't get a government bailout. Banks were given trillions in bailouts and emergency loans, allowed to dump years of bad investment decisions into special garbage facilities set up by the Federal Reserve, and urged to "drink. EDT New York's Metropolitan Transportation Authority, the nation's largest mass-transit system and one of the largest issuers of municipal debt, has asked the federal. Posted at 1:00 pm on April 28, 2020 by streiff. A bailout may or may not require reimbursement and is often accompanied by greater government oversee and regulations. CNBC's Jim Cramer is irate over the bailout for Carnival Cruise Lines — and questioning whether it is a case of crony capitalism. Why Hollywood Shouldn’t Count on Much Relief From $2 Trillion Federal Bailout up on the list to receive an industry-wide bailout, public policy experts told TheWrap. According to a report by Campus Reform, universities and colleges. Editorial: California lawmakers need federal bailout to plug budget holes Chronicle Editorial Board June 6, 2020 Updated: June 6, 2020 4 a. 6 percent (0. The American people are not even allowed to know what banks benefited from the Fed's intervention in the repo market, or what plans the Fed is making for future bailouts — even though the.

 

Mitch McConnell said he's OK with states declaring bankruptcy instead of requesting more federal bailouts-as Dems demand more money for state and local governments in the next coronavirus relief bill. The Federal Reserve, which is owned, not by the government, but by a collection of the large banks – the same institutions getting the trillions in bailout funds. ” “Non-bank lenders” issue loans that are less regulated than loans made by traditional banks, but they are also willing to take greater risks. Rosemont Capital, an investment firm linked to Hunter Biden who co-founded Rosemont Seneca, received over $130 million in federal bailout loans while his father Joe Biden was vice president under Obama’s 2009 federal loan program known as the Term Asset-Backed Securities Loan Facility, or TALF. (AP file photo). Economy Like the New Deal, every additional billion dollars in stimulus and bailout spending will further delay the. The Fed does this to push up the amount of excess reserves at banks, in order to regain control over the federal funds rate and the repo rates. The Fed's holdings are especially pronounced in the housing market. Treasury since then. 7 billion positive return to date is a $6. The Treasury Department has invested about $200 billion in hundreds of banks though its Capital Purchase Plan in an effort to prop up capital and support new lending. The Fed has implemented a number of programs to support markets this month, establishing a facility to lend to money market funds and securing $10 billion from the U. Share this on Facebook Tweet. By Glenn Jordan.

 

Here's an economic free-association test. 6 percent and Florida's 32. The COVID-19 pandemic is just beginning—but it is already having profound effects on many large businesses, which could lead to requests for federal government bailouts. CNBC's Jim Cramer is irate over the bailout for Carnival Cruise Lines — and questioning whether it is a case of crony capitalism. It has $36 billion in unfunded liabilities, according to a recent filing with the federal government. An envelope. Unusual partnership in coronavirus bailout allows Fed and Treasury to share the risk Published Thu, Apr 16 2020 6:07 PM EDT Updated Thu, Apr 16 2020 7:45 PM EDT Lauren Hirsch @laurenshirsch. So we have to understand the consequences—first, in terms of this size. Illinois pension plans are in serious trouble. "Calls for even more federal bailouts for states should be rejected," they add. Washington farmers, hurt by tariffs, are helped by federal bailout Dec. Illinois State Senator Don Harmon (D), who serves as president of the senate, has requested a $40 billion bailout from Congress, citing the economic burden of the coronavirus pandemic on the state’s ability to raise revenue. Unusual partnership in coronavirus bailout allows Fed and Treasury to share the risk Published Thu, Apr 16 2020 6:07 PM EDT Updated Thu, Apr 16 2020 7:45 PM EDT Lauren Hirsch @laurenshirsch. HHS has released new details on the latest payments to hospitals from the. The views and experience of like-minded people The Q&A forums, where you can get answers The latest postings by all editors. The Non-Bailout: How the Fed Saved Boeing Without Paying a Dime (Bloomberg) -- Less than two months ago Boeing Co. The magic number so far — the amount of federal money necessary to protect our nation from COVID-19’s economic devastation — is $1 trillion or more. The Wall Street bailouts, which included $311 billion for Fannie Mae and Freddie Mac, $90 billion for the Trouble Asset Relief Fund, and $6 billion for small business lending, cost the federal. Fed buys assets directly.

 

Newsom, legislators reach California budget deal that counts on federal bailout Alexei Koseff June 22, 2020 Updated: June 22, 2020 6:06 p. Fed, facing pressure, commits to disclose monthly who's getting bailouts. When the Dodd Frank Act was passed in 2010, President Obama triumphantly declared, "No more bailouts!" But what the Act actually said was that the next time the banks failed, they would be subject to "bail ins"—the funds of their creditors, including. The drama of profligate states using the coronavirus pandemic as an excuse to seek federal bailouts to paper over long-term mismanagement has finally found a Pavarotti — the editorial board of Chicago Tribune. New York is releasing $65 million in federal money to help preschools and day care centers reopen after the coronavirus forced many to close down. government bailouts that go back to the Panic of 1792, when. The conditions of the federal bailout stipulate that if an airline flew a route at least once a day, five times a week before March 1, it must continue to do so during the pandemic — or request. Insolvent Wall Street banks have been quietly bailed out again. An Austin-area congressman who ranks as one of the wealthiest members of Congress said that the car dealership he owns won a potentially forgivable loan from the federal government’s coronavirus. The Fed’s actions have largely worked, easing financial conditions and enabling corporations and municipalities to borrow in the U. Wisconsin lawmakers urge no fed 'bailout' money for Illinois delegation to oppose using any federal coronavirus relief package money to help bail out Illinois and other states with a. 1 trillion 2009 budget. Federal Reserve Chairman Jerome Powell and Treasury Secretary Steven Mnuchin have become the public faces of the $3 trillion federal coronavirus bailout.

 

It won’t be easy, but the Postal Service’s future depends on it far more than on another federal bailout for this erstwhile “independent” federal agency. The Bonds the Fed Left Behind in Coronavirus Bailout Are Struggling Fast-growing segments of the commercial bond markets are among those kept out of a $100 billion loan fund. 4 million in bailout funds. They decrease state sovereignty, incentivize future fiscal irresponsibility and create a moral hazard problem. The New York Fed will now be lavishing up to $120 billion a day in cheap overnight loans to Wall Street securities trading firms, a daily increase of $45 billion from its previously announced $75 billion a day. Federal Reserve siphoned off hundreds of billions of dollars from the central bank. If you doubt that the pension issue is central here, consider Illinois's request for a federal bailout, which proposes $10 billion in pension aid but only $1 billion to help provide health care. One chart being circulated on social media to support Cuomo's argument is an analysis published by the Tax Foundation, which shows federal money states receive as a share of their GDP. The Federal Reserve has authorized 11 financial bailout programs thus far. When Congress gave the Federal Reserve $750 billion of emergency firepower to backstop the country’s biggest companies, some lawmakers insisted on inserting a clause that now threatens to undermine the program -- and could pose a major problem if markets go haywire again. 3 trillion plan aimed at households, businesses and local governments hit hard by the coronavirus crisis. 2 trillion coronavirus stimulus he signed. Dick Durbin appears on “Chicago Tonight” on Sept.

 

There is not enough federal bailout money in the Treasury to save every pointless university in a bad recession. Put the Fed in charge of the coronavirus bailout U. I'm afraid that I will have to disagree with him on this one. ” “Non-bank lenders” issue loans that are less regulated than loans made by traditional banks, but they are also willing to take greater risks. After this news broke, at least a few figures with large Twitter followings seemed to suggest that Fed Chairman Jerome Powell had just bailed out stock investors. Trump winery eligible for bailout in virus relief law President Donald Trump’s Virginia vineyard could be eligible for a federal bailout under the $2. 9 billion to financial markets this week which is the equivalent of 12. 5 trillion in non-TARP funds to directly support the mortgage and housing market since. The problem is not the amount of money the Fed has been authorized to spend ― it's that the emergency lending programs the Fed has unveiled to date are not a rescue, but a license to steal. MTA seeks $4 billion federal bailout as mass transit ridership plummets during coronavirus pandemic. 9 billion (very modest compared to Germany’s investment). HHS gave the Florida lab $152,812 and the pain clinic $602,000 in federal bailout funds, according to the department’s recipient database. According to a report by Campus Reform, universities and colleges. In order to conceal the bailouts, the Fed now uses mainly currency swaps. A Federal Bailout Won’t Fix States’ Finances Bailing out the Illinois state pension system is the worst idea from a week in which we were discussing the health benefits of mainlining Lysol. OTTAWA—The federal government has rolled out a grab bag of financial aid worth almost $4 billion to clean up abandoned oil wells, support arts and culture and aid small business startups as Ottawa. 95 trillion in below-market, revolving loans to the trading houses on Wall Street.

 

The editorial board of the Chicago Tribune has repeatedly slammed the Illinois State Senate's request for a whopping $41. The new Obama administration returned the focus of the Federal bailout to its original intent by proposing a Public-Private Investment Program to purchase mortgage-backed securities from banks who were holding them. There are two dark secrets about the Fed's last bailout of Wall Street. Stock Speculators Have Made $109 Million For Every Covid Victim Since Fed Bailouts Began In March So, US stock market investors have gained a stunning $109 million for every American that has died from COVID-19 since The Fed began its bailout. Bianchi’s research clarifies that while bailouts for just a few select firms is unwise and likely to exacerbate moral hazard, a policy that provides broad-based relief and only during a systemic crisis will be beneficial both before and after a crisis. The Treasury and the Federal Reserve began working on a $700 billion bailout plan. Two decades of fiscal mismanagement have left state finances ill-prepared for the COVID-19 pandemic. 1 explained exactly which Fed bailout programs had received the money from the Treasury:. Put the Fed in charge of the coronavirus bailout U. 7 billion to bail out auto manufacturers. Federal bailouts of the states in the early 2000s and in the Great Recession of 2007-09 show us that these fiscally irresponsible leopards seldom change their spots. Fed Chair Powell Has Millions Invested with BlackRock, the Firm that Will Manage a $750 Billion Corporate Bond Bailout Program for the Fed. The Fed's efforts fill a new set of gaps in the emerging economic response to the crisis.

 

But the GAO audit states that the Federal Reserve Bank of New York (which the Fed. If you doubt that the pension issue is central here, consider Illinois’s request for a federal bailout, which proposes $10 billion in pension aid but only $1 billion to help provide health care. It continues to hemorrhage money and routinely reports big losses when the agency announces its financials at the end of each quarter or year. Writing to Federal Reserve Chairman Jerome Powell, the lawmakers encouraged the Fed to expand eligibility for loans from its Term Asset-Backed Securities Loan Facility, or TALF, for “non-bank lenders and fintech platforms. FirstEnergy has asked the U. President Donald Trump said Thursday he would consider having the federal government take equity stakes in companies accepting federal aid in a bailout geared toward blunting the economic impact. First, the Federal Reserve Board in Washington, D. The grant came as part of a larger bailout of airlines and airports around the country through the recently passed CARES Act. Re: Federal Reserve Improperly Failed to Disclosure $60,000 Billion in AIG Bailout The AIG bailout supposedly cost $182 billion and resulted in a profit of $18 billion for US taxpayers. Clearly there must be no other fat to trim in the state budgets if the first thing Democrat governors like Whitmer, Newsom, etc want to cut is education and first responders. The total government commitment and proposed commitments so far in its current and proposed bailouts is reportedly $ 1 trillion compared to the. The Treasury and Fed replace the two loans provided to AIG with a $150 billion aid package that includes an infusion of $40 billion from the government's bailout fund.

 

Where it stands: The American Hospital Association is asking the federal government for a $100 billion bailout, as well as a waiver of the 2% Medicare cuts that were mandated through sequestration in 2013. They almost didn't succeed. Any bailout plan will come too late to avoid a large increase in unemployment. Illinois pension plans are in serious trouble. It won’t be easy, but the Postal Service’s future depends on it far more than on another federal bailout for this erstwhile “independent” federal agency. to shepherd several debt-buying programs on behalf of the U. A lengthy investigation into the federal corruption case against Fiat Chrysler and the United Auto Workers details the role of the $12. by circulation according to Statista last year, is looking for a bailout of its pension fund. We respect your need to remain confidential and will use your contact information only to follow up with you regarding your submission. airlines including Delta, American, Southwest and United have agreed to the terms of the more than $2 trillion stimulus package passed by Congress two weeks ago, Treasury Secretary. HHS gave the Florida lab $152,812 and the pain clinic $602,000 in federal bailout funds, according to the department’s recipient database. The Seattle Times editorial board Boeing’s stance against taking a full federal bailout offers a long-awaited signal that the company sees a path out of its financial doldrums and production stall. WASHINGTON (SBG) — In an abrupt reversal of a policy position the White House staked out last week, President Donald Trump rejected the idea of using a forthcoming federal spending package to. The Fed's holdings are especially pronounced in the housing market. These bailout programs fall into three mechanisms: 1. CEOs rake in salaries that border on the obscene.

 

Mary Williams Walsh of the New York Times reports that Illinois is seeking a bailout from Congress for its pensions and cities: Illinois needs more than $40 billion in relief from the federal government because of the coronavirus pandemic — including $10 billion to help bail out its beleaguered pension system, according to a letter the Illinois Senate president sent to members of Congress. 4 billion invested, earning a $15. The data from 21,000 Fed transactions carried out between December 2007 and July 2010 involves eleven special lending facilities set up by the US central bank …. THE BANK BAILOUTS ARE HERE! The Fed will buy stocks and corporate bonds from primary dealers (banks) to help shore up liquidity. The Fed has implemented a number of programs to support markets this month, establishing a facility to lend to money market funds and securing $10 billion from the U. A plastic shopping bag lies on the ground at the Calabasas landfill on January 22, 2008. We're tracking where taxpayer money has gone in the ongoing bailout of the financial system. There is not enough federal bailout money in the Treasury to save every pointless university in a bad recession. Everyone deserves a Federal Reserve bailout. Wisconsin farmers will receive about $10 million in federal money from a tariff relief program. Tlaib, Merkley Lead Bicameral Letter Opposing Fed Bailout of Oil and Gas Industry 47 Members of Congress urge Fed Chairman to reject pressure from President Trump to protect fossil fuel industry Wednesday, May 13, 2020. Phil Murphy and, to a lesser degree, State Senate President Stephen Sweeney, D-Gloucester, seem excited about getting a federal bailout for the state government and its related authorities. The changes come after the firm - Occidental Petroleum - and the wider industry launched a vast lobbying effort to secure access to the Federal Reserve's lucrative bailout funds. The Fed does this to push up the amount of excess reserves at banks, in order to regain control over the federal funds rate and the repo rates. The Federal Reserve’s weekly balance sheet data release, known as the H. in Daily Dose, Featured, Government, News May 13, 2020 917 Views.

 

HHS gave the Florida lab $152,812 and the pain clinic $602,000 in federal bailout funds, according to the department's recipient database. Princeton University, which has an endowment of $26. Turns out Carnival Corporation was never missing out on any of the scam spending by Trump and Mnuchin and our country's federal reserves. According to a report one firm provided Fortune, overnight rates have breached the upper Fed rate an average of once a month since 2018 and spikes have grown larger over time. The US Federal Reserve on Wednesday posted details of its multi-trillion-dollar “shadow bailout” programs, showing that nearly every major US financial institution benefited from billions in unreported government loans. 4 billion in federal money descending on Palmetto State government – a tab which obviously doesn ’t include the stimulus checks mailed to individual South Carolinians. Department of the Treasury used funds from the Troubled Asset Relief Program. Federal Reserve tries to insulate U. Surgery Partners, the providers’ parent company whose. A subscription to Gary North's Specific Answers gets you instant access to:. "The Fed should not be in the business of bailing out companies that were in terminal decline and suffering largely from their own misadventures well before the coronavirus pandemic," David Arkush, managing director of Public Citizen's climate program, said in a statement Thursday. This week, the group issued a statement calling on Congress to include "relief for charities" in any COVID-19 legislation. Lambert in line for federal bailout, director 'very happy' with amount. Federal rules for bailout aid require airlines to propose giving up a financial stake The Treasury Department posted a 10-page guide for how it will help save carriers. 5 billion in annual revenue had qualified; under the new terms announced. The Fed's efforts fill a new set of gaps in the emerging economic response to the crisis. Accessible Keys for Video [Space Bar] toggles play/pause; [Right/Left Arrows] seeks the video forwards and back (5 sec ); [Up/Down Arrows] increase/decrease volume; [M] toggles mute on/off; [F] toggles fullscreen on/off (Except IE 11); The [Tab] key may be used in combination with the [Enter/Return] key to navigate and activate control. And unlike TARP, no business should be required to take a. economy has come a long way since the low point of the financial crisis of 2009-2008.

 

An annual study by national financial watchdog Truth in Accounting (TIA) found that many of the states that are now crowing the loudest for a federal bailout during the pandemic are among the states that are performing the poorest. Churches and houses of worship, unlike other 501(c)(3) nonprofit entities, do not file any financial information or disclosures to the Internal Revenue Service. The Federal Reserve tapped BlackRock Inc. The Federal Reserve Board of Governors in Washington DC. The price of this hidden bailout will hit all Americans. Below is a chart of the composition of the Federal Reserve's balance sheet, in billions of dollars. $1 Trillion Coronavirus Stimulus Unveiled: Corporate Bailouts and Loans, Checks for All The package seeks to curb the economic chaos caused by COVID-19. Published in volume 110, issue 3, pages 860-88 of American Economic Review, March 2020, Abstract: Expectations of transfers by central governments incentivize overborrowing by local governments. 7 million BTC. law on October 3, 2008, of the $700 billion financial-sector rescue plan is the latest in the long history of U. Mary Williams Walsh of the New York Times reports that Illinois is seeking a bailout from Congress for its pensions and cities: Illinois needs more than $40 billion in relief from the federal government because of the coronavirus pandemic — including $10 billion to help bail out its beleaguered pension system, according to a letter the Illinois Senate president sent to members of Congress. The changes come after the firm - Occidental Petroleum - and the wider industry launched a vast lobbying effort to secure access to the Federal Reserve's lucrative bailout funds. treasuries, government-backed mortgages, etc. Update: The bailout did pass, and the money is coming from the Treasury and Federal Reserve. They worked hard to avoid a complete collapse. Everyone deserves a Federal Reserve bailout. transportation and tolling amid the COVID-19 pandemic.

 

The federal government's failure to prepare for the arrival of the coronavirus, particularly the lack of large. Jackson mayor says he's optimistic, but not counting on a federal bailout money. Federal Reserve continued its bailout operations today after Treasury Secretary Steven Mnuchin told CNBC that he's in constant communication with Federal Reserve System Chairman Jerome Powell, and "There will be liquidity available—whatever we need to do, whatever. Writing to Federal Reserve Chairman Jerome Powell, the lawmakers encouraged the Fed to expand eligibility for loans from its Term Asset-Backed Securities Loan Facility, or TALF, for “non-bank lenders and fintech platforms. Durbin: Illinois Needs Federal Assistance, Not ‘Pension Bailout’ Amanda Vinicky | June 21, 2020 8:34 pm U. Surgery Partners, the providers’ parent company whose. Since 1934, a US bank has failed each year except 2005 and 2006. Many energy producers have sought federal bailout, Dallas Fed survey says. 2 billion budget deficit for this year, Gov. March 17, 2020, 6:01 p. 25 hospitals getting biggest slice of $12B federal bailout fund. Washington farmers, hurt by tariffs, are helped by federal bailout Dec. Avoid Taxes, Receive Federal Bailouts. Editorial: Michigan can't wait for a federal bailout. The data from 21,000 Fed transactions carried out between December 2007 and July 2010 involves eleven special lending facilities set up by the US central bank …. All big corporations were doing the same. 3 billion profit or an annualized rate of return of 0.

 

Clearly there must be no other fat to trim in the state budgets if the first thing Democrat governors like Whitmer, Newsom, etc want to cut is education and first responders. Let them file for Chapter 11 bankruptcy so they can continue operating and paying employees while they restructure. ” “Non-bank lenders” issue loans that are less regulated than loans made by traditional banks, but they are also willing to take greater risks. Writing to Federal Reserve Chairman Jerome Powell, the lawmakers encouraged the Fed to expand eligibility for loans from its Term Asset-Backed Securities Loan Facility, or TALF, for “non-bank lenders and fintech platforms. 2 trillion coronavirus stimulus he signed. A 'bailout' for Main Street? Fed says it is on the way. Despite Fed Chairman Jerome Powell’s reassurances at his press conferences that these programs are to help American. But the GAO audit states that the Federal Reserve Bank of New York (which the Fed. Political Battle Over USPS Future, Fed Bailout Continues as Mail Declines June 1, 2020 May 12, 2020 by ptimesadmin2015 While the U. March 13, 2020 (EIRNS)—The U. Why bailout might not work Term. Boeing should issue more shares and dilute its shareholders instead of asking the government for money. 5 trillion cash injection from the Fed. Boeing issued a $25 billion bond offering to shore up its finances amid the coronavirus and 737 Max crises instead of pursuing a federal bailout. When this and similar multiemployer pension plans fail to meet their pension obligations, the PBGC is supposed to pay a portion of the benefits promised to retired workers. Stock Speculators Have Made $109 Million For Every Covid Victim Since Fed Bailouts Began

 

In March So, US stock market investors have gained a stunning $109 million for every American that has died from COVID-19 since The Fed began its bailout. Wisconsin lawmakers urge no fed 'bailout' money for Illinois delegation to oppose using any federal coronavirus relief package money to help bail out Illinois and other states with a. 4) Federal Support for the Housing Market is on the Rise. Newsom, legislators reach California budget deal that counts on federal bailout Alexei Koseff June 22, 2020 Updated: June 22, 2020 6:06 p. Essentially, with taxpayers’ funds, the Fed can use the SPV to take a 10% stake in a number of Wall Street bailouts. Insolvent Wall Street banks have been quietly bailed out again. initial $150 billion in the federal CARES. A footnote on the H. “And here we. WASHINGTON, March 23 (Reuters) - U. He says that Buffalo depending on a federal bailout is a very risky move. The data from 21,000 Fed transactions carried out between December 2007 and July 2010 involves eleven special lending facilities set up by the US central bank …. Illinois State Senator Don Harmon (D), who serves as president of the senate, has requested a $40 billion bailout from Congress, citing the economic burden of the coronavirus pandemic on the state’s ability to raise revenue. By Terry Nguyen Mar 19, 2020, 12:30pm EDT Share this story. The price of this hidden bailout will hit all Americans. TIA found that some of these poorly managed states have huge taxpayer burdens, which the organization defines as each taxpayer's share of state bills after the. ” States should be saving for rainy days (like now). It gets more interesting when you realize foreign banks have access to the repo market, meaning the Fed can rescue any global financial institution in secret — hidden from the public eye. 1 billion in 2019. HHS has released new details on the latest payments to hospitals from the. Now comes the test to see whether the federal stimulus package is big enough and. airlines are asking the federal government for grants, loans and tax relief that could easily top $50 billion to help them recover from a sharp downturn in travel due to the new coronavirus. New "This is the kind of money that we most need," Tumlin said of the bailout, adding that without federal funds Muni would be hard-pressed. State Bailouts: 'Beyond Galling,' 'Shameless,' Too.

 

Government bailouts are not new, but interest has increased because of large and far reaching bank bailouts in the wake of the 2008-2009 economic crisis. Congress slams Fed for favoritism in bond-buying bailout The Fed created programs during the pandemic to buy corporate bonds and other securities to ensure that credit keeps flowing in the. In fact, the AIG bailout may have cost $60,000,billion more than disclosed and this amount was intentionally withheld from disclosure by the Federal Reserve Board of New York. government and taxpayers. The new Obama administration returned the focus of the Federal bailout to its original intent by proposing a Public-Private Investment Program to purchase mortgage-backed securities from banks who were holding them. Brown, Warren, Reed, Colleagues Blast JetBlue, Delta for Accepting Federal Cares Act Bailout Funds and Then Cutting Employees' Hours, Paychecks Airlines' Decision Is "Inconsistent With Congressional Intent And Is A Blatant And Potentially Illegal Effort To Skirt Your Requirements To Keep Workers On Payroll. Federal Reserve and Trump administration officials over the last week have greased corporate and bank financial markets, freed up half a trillion dollars for central banks in other countries. The lone watchdog on a congressional committee formed to oversee the Trump administration’s handling of a multi-trillion-dollar coronavirus bailout package demanded Wednesday that the Federal. Its bailout of risky debt including junk bonds helps investors, not employees. Treasury to guard against. The Fed is explicitly propping up asset prices. Facebook Twitter Email LinkedIn Reddit Pinterest. This means higher wages and meaningful work that contributes to the health of individuals, communities, and our planet. By Jessica Corbett. Unprecedented Housing Market Rescue. Clarke and Dawe - European Debt Crisis - Duration: 2:37. Congress is working again today to figure out what a final package for hospitals could look like. Indeed, it affirms the DFA’s Title XI requirement that emergency lending programs provide for “broad-based eligibility. 1 explained exactly which Fed bailout programs had received the money from the Treasury:. Federal Reserve tries to insulate U. US Federal Reserve banking bailouts are intensifying as the central bank adds the equivalent of 12. Fed Bailouts on June 8th Update Bank Bailout Data!!. At Bard College is Leiby Institute. Wisconsin farmers will receive about $10 million in federal money from a tariff relief program. The total government commitment and proposed commitments so far in its current and proposed bailouts is reportedly $ 1 trillion compared to the. Illinois Senate Democrats are asking the federal government for more than $41 billion in federal aid — about a quarter of it for a pension fund bailout — to keep the state financially afloat.

 

This is a lightly edited transcript of their conversation. ” “Non-bank lenders” issue loans that are less regulated than loans made by traditional banks, but they are also willing to take greater risks. Stock Speculators Have Made $109 Million For Every Covid Victim Since Fed Bailouts Began In March So, US stock market investors have gained a stunning $109 million for every American that has died from COVID-19 since The Fed began its bailout. The bailouts were designed to help farmers who were already weathering low prices on commodities such as soybeans before Trump’s trade wars sunk prices even lower. We demand the bailout address outstanding urgent needs, including health protections and economic relief for all, while also making a down payment on our future. 5 trillion in non-TARP funds to directly support the mortgage and housing market since. Congress slams Fed for favoritism in bond-buying bailout The Fed created programs during the pandemic to buy corporate bonds and other securities to ensure that credit keeps flowing in the. 7 billion positive return to date is a $6. The Treasury Department has invested about $200 billion in hundreds of banks though its Capital Purchase Plan in an effort to prop up capital and support new lending. Fed buys assets directly. Everyone deserves a Federal Reserve bailout. Source: rigged game. As expected, she also threatened cuts to education if the federal government didn't agree to send the state bailout money. FirstEnergy has asked the U. Let them file for Chapter 11 bankruptcy so they can continue operating and paying employees while they restructure. The total government commitment and proposed commitments so far in its current and proposed bailouts is reportedly $ 1 trillion compared to the. “We called Harmon’s request shameless and dishonest. Newsom, legislators reach California budget deal that counts on federal bailout Alexei Koseff June 22, 2020 Updated: June 22, 2020 6:06 p. Gary Friedman / Los Angeles Times / Getty Images

 

The plastics industry is asking the federal government for a $1 billion bailout to help recycling during the pandemic. When Bharat Rhamamurti, a Democratic member of the official oversight panel for the coronavirus bailout, asked the Fed to publicly disclose every rescue transaction it makes under the program, Powell assented. 7 million bitcoin to the financial system this week. homeowners currently owe on 6. The central bank said it would buy junk debt only of some companies that recently lost their investment-grade status. The magic number so far — the amount of federal money necessary to protect our nation from COVID-19’s economic devastation — is $1 trillion or more. Hill and his Great Northern Railroad is that the “winners” government picks today are the “losers” of tomorrow. Do toll facilities really need any federal funding, let alone $9 billion? On May 21, the International Bridge, Tunnel and Turnpike Association, which represents toll facilities, held a news conference regarding the state of U. Illinois pension plans are in serious trouble. When this and similar multiemployer pension plans fail to meet their pension obligations, the PBGC is supposed to pay a portion of the benefits promised to retired workers. Treasury to guard against. The American people are not even allowed to know what banks benefited from the Fed's intervention in the repo market, or what plans the Fed is making for future bailouts — even though the people will pay for those bailouts either through increased taxes, debt, or the Federal Reserve's hidden inflation tax when the next crash occurs.

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July 23, 2020

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Let the Banks Go Under and Put Money Into the Real Economy

by Michael Hudson – Ellen Brown

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Photograph by Nathaniel St. Clair

Ellen Brown: My guest today is Dr. Michael Hudson, who we’re delighted to have on our Public Banking Institute Advisory Board, and who really should be advising the Federal Reserve and the Treasury, but BlackRock seems to have gotten the job. Paul Craig Roberts, who is former Assistant Treasury Secretary under Reagan, called Michael Hudson the greatest economist on the planet. He’s a Wall Street financial analyst, Professor of Economics at the University of Missouri, Kansas City, and author of over two dozen books, including Killing the Host and one called … and Forgive Them Their Debts, which are both particularly relevant today. So it’s great to be speaking with you, Michael.

Michael Hudson: It’s good to be back, Ellen.

Ellen Brown:  Thanks. So, you recently wrote in The Washington Post the Corona virus outbreak is serving as a mind expansion exercise, making hitherto unthinkable solutions thinkable. Debts that can’t be paid, won’t be. A debt jubilee may be the best way out. So, for anyone who hasn’t heard you explain this before, could you explain what you mean by a debt jubilee, and why it may be the best way out, and what the real crisis is that it’s the best way out of?

Michael Hudson: Well, there was the debt problem that’s been mounting up ever since World War II. Every economic recovery, every business cycle since 1945 has started from a higher level of debt. Most people thought they were getting rich off debt because most bank credit – 80 percent of bank loans – are mortgage loans. They’re made against real estate. Banks have sought to expand the market, and have lent more and more against real estate. In the 1960s when I first bought a house, you had to have debt service absorb not more than 25 percent of your income. You had to put down 30 percent of the price of the house. So basically, a house was worth whatever a bank would lend.

But by the time that the economy collapsed in 2008 – or rather, by the time the financial system collapsed – banks were making loans with zero down payment. You didn’t need 30 percent. The requirement that mortgage payment be affordable – 25 percent of your income – went out the window. Banks would lend any amount of money, regardless of what you were making. And even the interest didn’t have to be paid. Instead of having a self-amortizing mortgage where you’d own the house after 30 years of paying the bank, you’d pay the bank after 30 years and you wouldn’t own any more at all, because you wouldn’t be paying any amortization.

So basically, banks lent so much money against housing, inflating it up to such a high price, that after paying the mortgage costs – or, if you can’t afford a house, if you’re a renter – after paying the debt service and the credit card debt, the other debt, and after paying the insurance costs and taxes, you really don’t have much left for basic goods and services that you produce, except for the bare minimum of food, clothing and transportation.

So a point was reached already by the time the virus broke out of how the economy can continue to grow. For 95 percent of the population, the economy stopped growing in 2008, when Obama bailed out the banks and left all the bad debts in place. Since 2008, all the growth of GDP – all the increase in national income – has accrued just to the wealthiest five percent of the population. That means that for 95 percent of the population the economy hasn’t been growing at all. It’s been shrinking.

The question is, how are you going to grow if you leave all of the debt service in place, if you leave all of the debt pyramided housing in place? Bonds and stocks are so high-priced that they don’t yield an income for retirement anymore. The economy reached a point already by the beginning of this year that it had to choose either to pay all the debts, continue paying the growth in income to the five percent that basically are the creditor and financial class, or write down the debts and let the economy grow again.

The basic issue is, who is the economy going to be run for? Is it going to be run for the banks and Wall Street, or for Main Street? Well, you said I should be a adviser to the Federal Reserve and Treasury. They wouldn’t pay any attention to anything I say, because they run the economy for Wall Street. As you’ve just seen, the Federal Reserve has created a virus of quantitative easing since 2008. First, four and a half trillion dollars for the Obama bailout, and then another two trillion that is set to go up to 10 trillion, essentially just to buy stocks and bonds and push up the prices of assets that the five percent own.

So the Federal Reserve basically is working against Main Street. It’s working only for its constituency, which are the commercial banks, instead of trying to think how can the economy free itself from this debt overhead? It certainly can’t work its way out of debt because nobody’s earning enough money to amortize, that is to pay off the principal. All they can do is try to pay the current interest charges. So the economy has painted itself into a corner. And that’s the problem that I address in Killing the Host and all the books that I write and all the interviews that I do.

Ellen Brown: I totally agree with all that. You mentioned this four and a half trillion, which is levered up. I just wondered, how do they get away with that? I mean, it’s not a bank. Why did they figure ten to one? Tthey could do 100 to one. The Federal Reserve can issue whenever it wants. I guess one of my basic questions about the Federal Reserve is that people say they could actually go bankrupt, their balance sheet doesn’t balance, and all that. Do they actually have a balance sheet that counts?

Michael Hudson: Sure they have a balance sheet. The question is, what is a balance sheet? You have assets on the left-hand side and liabilities and net worth on the right-hand side. The Federal Reserve can create a credit / deposit, just like a bank does. If you go to a bank and want to borrow money, the bank will create an account for you just on the computer. “Here’s $100,000 we’re putting in your checking account. Go buy a house or do anything.” In exchange, the bank has an asset, a claim on you for repayment with interest. Well, the Federal Reserve also can do anything on its balance sheet. It can tell corporations and the banks, “We’re the Statue of Liberty: Give us your poor junk loans, give us your bad debts, give us all of the junk, and we will create a deposit – 100 cents on the dollar for it – and we will pick up all of your bad loans. And we know that the loans can’t be paid, because the economy can’t pay.”

On the asset side of the balance sheet, we’ll say we have the claim against you. And we will then give you the money for it. And we will try to make sure that we don’t have to lose money on these assets that we’ve let you pledge to us, because we’re going to keep bidding up the market higher and higher. We can do that not only by buying stocks, junk bonds and packaged mortgages, but we can do financial tricks.

You mentioned Paul Craig Roberts before, former Undersecretary of the Treasury for International Affairs. He told me that what the Federal Reserve is doing these days is manipulating the forward market. It will go into Wall Street and it will say, “We promise to buy the Dow Jones average at 50 points higher than it is today, next week.” Well, once it makes a promise to buy, the speculators will see that and they will begin to bid up the prices to what the Federal Reserve promises to pay for the stocks. It can keep doing that, week after week and month after month and it can keep pushing up the stock market. That’s how it pushes up the bond market by promising to buy bonds at a higher and higher price. That means that an existing bond will yield less interest income. They can just continue to inflate the economy with credit, like a Ponzi scheme.

So the Federal Reserve is the official Ponzi scheme that keeps finance capitalism operating in the United States. Obviously, at some point every exponential growth scheme has to stop, because otherwise you’d have an infinite amount of debt. So at a certain point, the Fed will sit down with the main Wall Street firms and the main billionaires that are behind these firms, and say, “Well, you know, the game is over. We’ve got to let it go.” These investors will say, “OK, we’ll take the money and run.” That’s what a lot are all doing already. “We’re going to buy gold. We’re going to buy real estate in New Zealand, so we have somewhere to run to when the economy collapses.” They’re just going to drop everything, sell out and there will be a crash with the pension funds and the small savers who aren’t in on the game, losing whatever they have.

Ellen Brown:  This goes on over and over. My question about the Fed’s balance sheet, though, does their balance sheet have to balance?

Michael Hudson: Every balance sheet balances, because any transaction is a balance. If you’re a physicist talking about a man falling flat on his face, that’s equilibrium. Anything can be looked at as a duality of two sides of the same coin. The two sides are assets and liabilities. And if I promise to pay you $100,000 for a broken down car, I can say that I have an asset worth $100,000, and you have a $100,000 IOU from me. That balances. It’s just not a realistic balance. So balance sheets do have to balance, but they don’t have to be realistic.

Ellen Brown: Of course. I think we need a universal basic income. And you think we need a debt jubilee and we need to discuss what those are. But let’s say they’re paid by the Federal Reserve. The argument against that is that, like real helicopter money where you just drop money on the people, you can’t bring it back and therefore it would be inflationary, whereas what they do is supposedly reversible. So if you buy an asset, you’re putting money into the economy. And then if the economy overheats, as they say, then you can always sell the asset back and pull the money back and shrink the money supply. And you can’t do that with the UBI or writing off debts or all those various things. But it seems to me that they never can reverse their quantitative easing anyway. What do you say to that argument?

Michael Hudson: You’re quite right. Remember, the Federal Reserve helicopter only flies over Wall Street. It doesn’t fly over the economy. All this $4.5 trillion of quantitative easing, and all the $2 trillion that it’s created under the Trump by the CARES Act – all this could have been spent into the real economy. It could have been spent building infrastructure. It could have been spent supporting basic income. It could have been spent on the people and Main Street. Instead, it was only spent on Wall Street. The idea is that if you buy an asset, you can always make a profit. That created the middle class from 1945 to about 2008. The way that almost all the middle-class wealth in America was accumulated was through the rising price of housing. In other words, every family that bought a house had to pay more and more of its income, and a higher and higher price to get a house. That’s enriched the people who were fortunate enough to have been able to buy real estate in 1945: white people, not blacks, not Hispanics; they were red-lined. But if you were a white person with a job, you could get onto the middle-class debt treadmill, and actually make it work for you – for a while.

Everybody thought that they could just keep borrowing money to make an even larger asset-price gain. Remember, in 2006, 07 and 08, people thought that if you borrow as much as you can, forget the interest rate, you can pay back the banks out of the rising price of the housing. But then the housing price stopped and you had nine or 10 million families lose their homes in the great Obama foreclosures. He said, “Either I can support the banks or I can support my voters. Who am I going to support? Well, the banks are my campaign contributors and I’m going to support my donor class.” He invited them to the White House and said, “I’m the guy standing between you and the mob with pitchforks.” the voters for me, the people that Hillary called the deplorables. He said, “I’ll protect you,” and he did indeed. No banker went to jail. He gave the banks enormous amounts of money, at the cost of the 10 million families that he exploited. The cost was stopping industrialization in this country, stopping the domestic market and bringing on the Obama depression.

That’s the policy that Biden is committed to follow. He committed himself in the last few days, saying that his intention to get re-elected is not to appeal to Bernie Sanders or the left or the working class, but to try to get enough Republicans to vote for him that he can beat Trump. He’s supporting the position he pushed as vice president, supporting the banks, trying to write down Social Security, cut back Social Security, cut back Medicare, cut back social spending in order to give to the donor class on Wall Street. So we’re going to see Obama with an exclamation point with the Biden-Republican program likely to come to this country.

Ellen Brown: We’re in a sorry state, I think. So your proposal then would be that we have a debt jubilee. So can you describe what that is and where the term came from and how you would actually do it?

Michael Hudson:  The term jubilee came from the Bible. It was pronounced “yobel.” The J was pronounced Y, as in Spanish and Hebrew. “Yobel” was the term used in Leviticus 25, saying that every 50 years you will cancel the debts, and you will free the debt servants who’ve been subjected to bondage, and you’ll return all of the slaves that have been pledged to creditors as the main collateral to the debtor, and you’ll return the land that they also lost. The yobel was the horn that was blown on the jubilee to signal it. But the word that they used in addition to yobel was deror, which was a cognate to the Babylonian word andurarum. It had been used ever since the Hammurabi and the Babylonian dynasty back in 1750 BC. Hammurabi, like every other member of his dynasty, started his reign by claiming an anderarum, a clean slate, a debt cancellation. He did this because he realized that debts grew faster than the ability to pay. If you didn’t write down the debts, you would have much of the population falling into debt to the creditors, including wealthy members in the palace bureaucracy. Hammurabi and other Near Eastern rulers realized that if you let people fall into debt to the creditors, they would have to spend their labor working for the creditors on their land, and wouldn’t be able to work on the public corvée infrastructure work. They wouldn’t be able to build palaces or walls, and they wouldn’t be able to pay their crops as taxes, because they’d owe it as interest to their creditors.

The reason I mentioned Hammurabi and selected him is because in his laws. You have the first example of an Act of God clause. One of Hammurabi’s laws said that if there is an act of God, if the storm God Adad floods the fields with water and you can’t harvest the crop, or if there’s a drought, then you don’t have to pay the rents or tax debts. “You’re freed from the debts because we don’t want you to fall into bondage to the creditors, because then you’d pay them the surplus and we wouldn’t have it at the palace.” And in other parts of his laws he said if there’s an epidemic, if there is a sickness, or if there’s a military defeat, then debts are cancelled because the whole idea is we’re not going to let the money that people owe grow to such a large rate that the economy shrinks and people fall into bondage. He knew very well that if the population fell into bondage, then either they would defect. There was constant warfare. Either they’d go over to somebody else’s side, or there’d be a revolution and they would overthrow the ruler and cancel the debts.

Attempts to overthrow rulers who didn’t cancel the debts were made all through Greek and Roman antiquity, from the eighth century BC down to the time of the first century B.C. in Rome. There were constant debtor revolts. The question ever since Roman times has been, what do you do when the debts get too large to pay? Well, the debts were simply written down in the Near East. They were not written down in Rome. Instead, you had a small oligarchy taking over the economy and enslaving or reducing most of the population to bondage. The result was the Dark Age.

So to get back to your question, how do you cancel the debts? Look at what’s happening right now with the virus. A lot of people are unemployed – what’s the number 20 million or 40 million unemployed? They’re not able to pay their rents or, if they bought a house, they’re not able to pay their mortgage and other debts. So rents and mortgages are going unpaid. Beginning in July, and especially in August, there’s talk of large-scale evictions. Millions of Americans who’ve lost the job will not get any more money from the government. They’ve had to use the stimulus money just to buy food on the table and break even. So if you don’t write down the debts for these people, if you don’t cancel the rents and say, “OK, we know that you didn’t have a job, you can’t pay the rent.”

The same is true for businesses, especially for restaurants. If you don’t free them from the rents, then they’re going to go out of business and they’ll be unemployed. And, you’re going to have a gigantic homeless problem in the United States. You can just imagine the political results of all that. For one thing, now that the rents aren’t being paid, homeowners have been saying … and businesses, restaurants and stores … that they have insurance against the interruption of business. The insurance companies, which are just as crooked as the banks in this country, are saying, “Well, we can’t afford to pay you. It’s true, you got insurance, but if we paid you, then we’d go broke. So we’re not going to pay you.”

And the landlords, meanwhile, say, “Well, if we don’t get the rent, then we can’t pay the banks and the banks will foreclose.” That’s one reason why Wall Street is soaring. This is a bonanza for the really rich billionaires and multibillionaires and big companies like Blackstone. They think, “Oh, boy, there’s going to be another wave of foreclosures. Trump is doing as wonderful a job for us as Obama did.” Under Obama, homeownership fell from 57 percent to about 51 percent. And now there’s so many people who’ve been unable to pay their mortgages, that they’re going to lose their homes. The banks will sell the homes and office buildings in a convulsion of sell offs. Blackstone and other speculators are all going to be able to get rich and homeownership is going to plunge in the United States by another five points. We’ll be turning away from being a home-owning middle-class society into a rentier society that’s more and more impoverished. That is the result of what’s going to happen if the debts are not written down.

So the question is, is it really worth subjecting the economy to poverty, to homelessness, to close down businesses, to end the middle class in order to pay debts to the financial class that have made all the gains and growth since 2008? Or do we want to say, “OK, the debts can’t be paid.” That means that the mortgages won’t be paid, the loans won’t be paid, and some of these trillions of dollars that the financial sector and the Five Percent and the One Percent have made are going to be given back? Well, the One Percent says, “We’re not going to give back a penny. We are going to insist that the debts be paid. It’s worth it to us to impoverish the economy so we can get richer, even if by getting one dollar, we’re willing to make the economy lose a billion dollars because that’s all we care about.” That’s the point at which the American economy has reached today. Most of the discussions in the mainstream press don’t spell out the fact that if the economy does not write down the debts, we’re in for a chronic depression that will last until the debts are finally written down.

Ellen Brown: So if you were to write them down, it would have to be up to Congress, like you say. I mean, they’re the only one with the leverage to do it. They’ve got control.

Michael Hudson:  Or, it can be up to the people in a revolution. In Rome there were revolutions to do it.

Ellen Brown: That’s true. I think there are a few Congresspeople we could get to bring a bill or something. How would you do it? Would the banks just write off those mortgages or, you know, there are some landlords who … like little old ladies who have rented out some rooms and that’s their income, for example. I mean, there are some people that really probably don’t deserve to be in that position. But the banks, we definitely don’t seem to mind writing down their loans. I just wondered exactly, if you were to have the ability to implement such a law, how would you write it?

Michael Hudson: You have to let nature take its course. You have to let the banks go under. You had a wonderful chance in 2008 for the banks to go under. We’ve spoken before on this show about what the FDIC proposed under Sheila Bair. She said, “Look, the most incompetent, worst-managed bank in the worst trouble is Citibank.” She said, “We could have taken it over.” There was enough money in Citibank to pay all the insured depositors. The speculators, stockholders and some bondholders would have been wiped out. But the bondholders are the wealthiest One Percent. We could have taken it out. And then, Citibank could have been operated as a public bank, which is what you’re talking about.

The fact is that banking should be a public utility. Privatized banking has not really helped the economy, because it makes loans basically against collateral. When you make loans against collateral – the house, real estate, corporate stocks and bonds – the effect of bank lending is to increase the price of this collateral. You end up with a high-priced economy: high housing prices, high retirement-income prices, high insurance prices. And you can’t have a viable public banking system built on the wreckage of the commercial banking system that has almost committed suicide, as you’ve described. You’re not going to be able to go forward.

You can’t simply return to normalcy because normalcy was a situation that brought us to this problem to begin with. You can’t simply keep lending, bailing out the banks and giving them more and more money to increase the debt more and more, because at a certain point the debt can’t be sustained. There will be a write-down of debts, one way or another. The question is, how will the debts be written down when they can’t be paid? Either you’re going to have foreclosures, which was the Obama and the Biden Democratic Party solution, or you’ll have the creditors and the banking system lose. If you were to rewrite the laws to take away all of the special tax favoritism for the financial sector, all the special deregulation and favoritism for the banks, they’d go under and the government could easily take them over and operate them as public banks, more and more like savings banks used to be. They wouldn’t necessarily be able to create credit except for public-authorized purposes. They wouldn’t be able to make the takeover loans, the predatory payday loans, and the other kinds of predatory finance that the commercial banking system has become in this country. So the problem isn’t simply a debt write-down; it’s to restructure the financial system to make it into a public utility instead of a private monopoly.

Ellen Brown: Right. I totally endorse that. That sounds great. So, I saw you wrote recently about the question of whether it wouldn’t be inflationary doing all these bailouts. You said no, that we’re actually in an era of deflation, and basically the way the Fed has been doling out money to the financial sector makes the deflation issue worse. Can you explain that?

Michael Hudson:  There are two kinds of prices in the economy. One is prices for goods and services that people buy: the consumer price index for food, clothing, shelter; the other is the price of assets. What we have is asset-price inflation. The banks have been bailed out to lend more and more money against assets, that is, the collateral that they lend against. So banks have created this huge rise in housing prices. The basis of middle-class wealth has been created by banks increasing the price of real estate, the price of stocks and bonds. But increasing the price of real estate means that in order to buy a home of your own, or in order to rent a home, you have to pay more of your income to the financial sector, to the banks for the mortgage. Rent is for paying interest. Speculators, absentee owners, and real estate developers will borrow money from a bank in order to pay all of the rent basically for interest. What they’re after is the capital gain – the price rise. But as prices rise for real estate, stocks and bonds, the rest of the population has to pay more income, not only for housing but for a retirement income, and for monopoly goods and services. We turn into a rentier economy. More and more income is paid for economic rent, not for profits, not for wages, not for goods and services, but as a carrying charge for assets that are financed by bank credit. This is where the financial sector undercuts the economy.

This is not capitalism, in the sense that it is not industrial capitalism. It’s not what people expected in the 19th century. Finance capitalism can be thought of as the failure of industrial capitalism to free economies from rent and interest and from the legacy of feudalism. The finance capitalism that we have is the road back to feudalism. It’s neofeudalism. It’s neoserfdom. It’s turning the population into debt serfs, debt peons who have to pay all of the income that they have to the creditor, and don’t have enough money to buy goods and services. So of course, goods and services prices are actually falling, because people don’t have enough money to buy them. That’s because more and more of their income is paid for access to financialized housing, financialized public utilities and financialized monopoly services.

Ellen Brown: That’s my argument too. You could pour money into the real economy in the form of universal basic income or any other kind of helicopter money, relieving student debts, etc. And because that economy is actually short on money, it would fill that gap, the difference between debt and the money available to repay it. And the money that trickles up, that goes into the other … There are actually two economies and the money that goes into the financialized economy never comes back. I wish I could prove that, but it seems to me you can just see that that’s true. There’s only so many shoes you can buy. All the rest of your big money goes to big things like bribing politicians or buying Iowans their yachts or something like that.

Michael Hudson: There’s a simple explanation. The money doesn’t go back to the real economy, the production and consumption economy. The goes into the financial economy. It is recycled into bidding up the price of houses and stocks and bonds. And this price can go down and it can disappear. It can be eradicated, and always is in a financial collapse. So the question is, what is the economy? There are really two economies. There’s the production and consumption economy of workers producing goods and services, and buying what they produce. And there’s the financial economy. It’s really more than the financial economy. It’s the finance, insurance and real estate sector — the FIRE sector. When the money goes out of the goods and service economy into the rent and interest economy, it goes from the 99 Percent into the hands of the One Percent. So you can have the Main Street — the 95 or 99 percent of the population — and the financial economy that are becoming very much like the hereditary landlord class that ruled Europe off in the Middle Ages until the 19th century when industrial capitalism was supposed to free economies from this predatory class.

Industrial capitalism seemed to be taking off until World War I, but World War I changed everything. Since then, you have had a degeneration of industrial capitalism into its antithesis finance capitalism, which is really a fall back into neofeudalism and neoserfdom. Where will the Americans emigrate to when there are no jobs and they lost their houses?

Ellen Brown: Yeah, they’ll go to Mexico. I saw a joke about that, something about, “Are you coming in or going out?”

Michael Hudson: Well, they’d better learn Spanish.

Ellen Brown: Yeah. Yeah. Saw another joke it was the Statue of Liberty said, “Another year like this and gone back to France.” Yeah, well, it’s been great talking to you.

Michael Hudson: By the way, the Statue of Liberty holding the torch, that iconography occurs very early in civilization. When Hammurabi cancelled the debts, he raised the sacred torch. And the announcement “the ruler has raised the sacred torch” was a symbol in Babylonia for proclaiming a debt cancellation.

Ellen Brown:  Oh cool. We have that right in New York Harbor.

Michael Hudson: Yes.

This is a transcript from the July 21, 2020 edition of Ellen Brown’s It’s Our Money podcast.

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Robert Singer 

The Bank of the Fed is Closed… Forever

February 26, 2010 0 Comments

Robert Singer
Infowars.com
February 26, 2010

In an effort to explain our escalating financial crisis, an American Nightmare (an Environmental Dream), the pundits are focusing their angst on the 44th POTUS, who might very well go down as the single most inept president in all of American history. (How to Squander the Presidency in One Year, David Michael Green)

The decision to have Obama preside over the greatest financial calamity since the Great Depression was made five years ago.

Barack Obama is not inept, greedy or stupid and he isn’t one of  “us”.

He rose from obscurity to power with his top economics adviser, Zbigniew Brzezinski, the co-founder of David Rockefeller’s Trilateral Commission and he travels in the same circles as other members of the super-secret Skull & Bones Society at Yale University, who pretend to be running for president every four years.

The decision to have Obama preside over the greatest financial calamity since the Great Depression was made five years ago; the November election was a formality. (Why Joseph Biden will be the Next Vice President of the United States)

To believe otherwise, is to ignore the Bradley/Palin effect and the decision by John McCain to wait until his concession speech to shed the image of a nasty “grumpy old man.”

In September 2008, when the Obama campaign seemed to be slumping and their candidate’s long-standing lead in the polls had evaporated, the senator’s supporters openly worried that a potential victory might be slipping away. Then, providence joined the campaign: the failure of the giant investment bank Lehman Brothers followed by a global financial meltdown in the month of October.

And, “speaking of change”, escalating the war in Afghanistan and Iraq and his policies on Guantanamo, state secrets, renditions, executive power, bail-outs and the stimulus packages are for the most part identical to those of George W. Bush.

However, the policies at the Federal Reserve have changed…inexplicably, monumentally and historically:

As of October 2008, the men behind the Federal Reserve, all connected to the House of Rothschild, are no longer giving up what’s left of their real wealth so the middle class can live the American Dream, a nightmare for the planet.

Brian Deese, special assistant to president Obama for economic policy, in his first government position, shuffles back and forth from the West Wing to the Treasury Department rewriting the rules of American “capitalism” as he dismantles the US Housing, Automobile Industry and the American Dream. (The 31-Year-Old in Charge of Dismantling G.M., David E. Sanger)

Deese’s First Rule: Withdraw Credit and Liquidity:

Causing spending to fall even further, forcing companies to cut back on inventory and staff – Creating even more unemployment…263,000 jobs eliminated bringing the total to 39 million Americans who are no longer working or looking for work. (The September Employment Rate is 90%)

And that’s before the recently announced “planned three-year budget freeze on government discretionary spending.”

The Federal Reserve Act of 1913

One of the most important domestic acts in the nation’s history took the power to create money from the people and gave it to the robber barons of our filtered history books in theory for profit.

The Federal Reserve was instrumental in the development of America into a world power.

The United States, in its first decades, was a land of small farms and nearby towns with few cities of any consequence. The young nation seemed far more interested in becoming a successful experiment in democracy, rather than an economic power.

A central bank, necessary for a consumer society, large cities, a common medium of exchange, and a mechanism to regulate that medium were greeted with hostility, since many of the nation’s leaders disdained the urban life.

Anyone who spoke against the “Creature from Jekyll Island” by G. Edward Griffin was silenced.

Presidents Garfield and McKinley, outspoken champions of “sound” money and opponents of a central bank, were suspiciously silenced permanently.

The conflict between rural values and urban reality ended when Woodrow Wilson “unwittingly ruined his country” and signed into law the legislation that put “the growth of the nation . . . and all our activities in the hands of a few scoundrels (men).”

Once those scoundrels got control of the supply of money in the Franklin Roosevelt Administration, they began to buy government securities at the rate of ten million dollars a week for 10 weeks, and created one hundred million dollars in new (checkbook) currency, which alleviated the critical famine of money and credit, and the factories started hiring people again.” (Secrets of the Federal Reserve, Eustace Mullins)

·       A d v e r t i s e m e n t

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Now those scoundrels remain in control of the supply of money in the Barack Obama Administration, they are making generous interest payments to the banks for “parking” their TARP and other government taxpayer bailout money, which is aggravating the critical famine of money and credit, and the factories started laying people off (263,000 people in September bringing the total to 39 million Americans who are no longer working or looking for work).

One of the more absurd notions that found its way into the history books and the writings of economic experts, is that somehow these Robinhood barons (swindlers and scoundrels of history) were made wealthier by manipulating the Monopoly money they created out of “thin air” used to “alleviated the critical famine of money and credit” so the factories could start hiring people again and finance our consumer society.

In 1910, the men behind the Federal Reserve Rockefeller, Kuhn, Loeb and Morgan, all connected to the Rothschild’s global financial empire, owned or controlled one-sixth of the world’s real wealth—gold, silver and raw materials—not the fiat currency we call money.

And their real wealth, where is it now?

Used up, as in consumed, by the middle class so former members of the Third Estate (serfs and slaves) could have houses, cars, RVs, TVs and DVDs—the affordable things we take for granted which put the planet, according to the GEO4, a massive United Nations Report, at the “unknown points of no return.” (Liberté, Egalité, Fraternité – Providence, Miracle or What Really Happened)

The swindler’s and scoundrel’s wealth, not yours or mine, was eventually “cut, mined and hauled away,” so that Americans could “trash the planet” with that cheap stuff until October 2008.

Money control, Gustav Stolper wrote in “This Age of Fables” is, “the supreme and most comprehensive of all governmental controls and the 1838 quote:

“Permit me to issue and control the money of a nation, and I care not who makes its laws” (Incorrectly attributed to Mayer Amschel Rothschild who died in 1812).

Reflects the “maxim” of the House of Rothschild.

However, “money lenders of the Old World” cannot be talking about profits unless you believe The Rothschilds didn’t understand that they were about to give up $500 trillion of real wealth in exchange for $500 trillion pieces of worthless fiat currency.

During the last 100 years, those swindlers and scoundrels were able to distort the structure of relative prices; generate misallocations of labor and capital throughout the economy; rationalize new governmental interventions in the face of the market “instability” manipulate the patterns of and the profits from international trade which resulted in the Industrial Revolution, the Great Depression, the stagflation of the 1970s, the dot-com and the housing market bubbles and unprecedented prosperity for the middle class.

Would we have a financial crisis to go with our environmental crisis if Wilson hadn’t ruined the country when he gave away the people’s right to print their own money and we had our own bank?

No.

North Dakota is the only state in the union to own its own bank. The Bank of North Dakota (BND) was established by the state legislature in 1919 specifically to free farmers and small businessmen from the clutches of out-of-state bankers and railroad men.

The state of North Dakota, one of only two states (along with Montana) expected to meet its budget in 2010. North Dakota was also the only state to actually gain jobs in 2009 while other states were losing them. Since 2000, North Dakota’s GNP has grown 56 percent, personal income has grown 43 percent and wages have grown 34 percent. North Dakota in 2009, had a budget surplus of $1.3 billion, the largest it ever had – in a state with a population of 700,000. (The North Dakota Model for Capitalizing Community Banks, Ellen Brown)

North Dakota, a land of small farms and towns more interested in remaining a successful experiment in democracy rather than an economic power.

At this point, it is advantageous to consider the efforts of writer Andrew Hitchcock:

“The Rothschilds have been in control of the world for a very long time, their tentacles reaching into many aspects of our daily lives, and are the hidden hand behind all the social cataclysms in history: The French and American Revolution, the Civil War, World Wars, the Industrial Revolution, the Federal Reserve (and our consumer society).”

John Sherman, a Rothschild protégé in a letter sent to New York bankers on June 25, 1863 in support of the then proposed National Banking Act, wrote:

“The few who understand the system, will either be so interested in its profits, or so dependent on its favors that there will be no opposition from that class, while on the other hand, the great body of people, mentally incapable of comprehending the tremendous advantages…will bear its burden without complaint, and perhaps without suspecting that the system is inimical to their best interests.” (World War II And Pound, 1940-1945: The Anti-Semite Revealed, Ellen Cardona)

In other words, the “few that understand the system”, without a 20th century environmental perspective of the middle class “trashing the planet”, would not be capable of comprehending a system that would put the planet at the “unknown points of no return” because the environmental damage and pollution was the goal and not the unintended consequences of the Industrial Revolution and our consumer society.

The Federal Reserve isn’t evil because they print our money and make us pay interest on it; they are evil because they are in a metaphysical war with mother-earth (Gaea).

October 2008 marked the last day the “lender of last resort” would give up what’s left of their real wealth, used to con us into shopping for useless toxic stuff, to weaken their opponent, mother-earth. (Ominous Signs Are Aligned: Not A Particularly Good Sign (11-09))

 

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How BlackRock Rules the World

The planet’s largest investment fund handles Mexico’s pension funds—and owns the companies they invest in. Cozy!

by David Dayen

September 27, 2018

(Laurent Gillieron/Keystone via AP)

A new pecking order has emerged on Wall Street. Big banks remain powerful and incredibly profitable—quarterly income has hit record levels throughout 2018, largely due to benefits from the tax cuts. But a decade of financial crisis, regulatory pressures, and (most important) new investing trends has transferred power to a few dominant asset management firms. As more Americans plow retirement savings into passive funds, the buy side has overtaken the sell side.

Buoyed by an index fund collection called iShares that it purchased from Barclays, BlackRock is the world's largest asset manager, with $6.3 trillion of other people’s money under its control. BlackRock’s Aladdin risk-management system, a software tool that can track and analyze trading, monitors a whopping $18 trillion in assets for 200 financial firms; even the Federal Reserve and European central banks use it. This tremendous financial base has made BlackRock something of a Swiss Army knife—institutional investor, money manager, private equity firm, and global government partner rolled into one.

The BlackRock Transparency Project, an initiative from the Campaign for Accountability, a watchdog organization focused on public corruption, seeks to demystify the firm’s “access and influence” business model. BlackRock forges close relationships with governments to outpace competitors, attracting special benefits and avoiding onerous regulatory standards. Since 2004, researchers note, BlackRock has hired at least 84 former government officials, regulators, and central bankers worldwide. This can quickly bleed into conflicts of interest and official corruption.

For example, it's no secret that BlackRock

CEO Larry Fink built a shadow government of former agency officials in a bid to become Hillary Clinton’s Treasury secretary. That didn’t stop Fink from becoming part of the main private-sector advisory organization to Donald Trump until that panel disbanded after Charlottesville.

Links to leaders in both parties have enabled BlackRock to successfully fight designation as a systemically important financial institution, keeping its trillions outside the Dodd-Frank regulatory perimeter. The Treasury Department official leading efforts to relax that designation and keep asset managers outside its grip is Craig Phillips, a former BlackRock executive.

This model of fused BlackRock/government relations doesn't stop in the United States, as researchers at the BlackRock Transparency Project have laid out in a series of reports. The first focused on Canada's Infrastructure Bank, a public-private partnership for low-cost loans for road and bridge projects, which BlackRock advised on creating and helped staff with friendly executives. BlackRock subsequently stands to gain from the bank it helped construct.

The latest report, provided exclusively to the Prospect, details a deep tangle of relationships between BlackRock and the outgoing government of Enrique Peña Nieto in Mexico. This has bolstered BlackRock’s efforts to generate an infrastructure business in Mexico from scratch. Since 2012, BlackRock has purchased stakes in Mexican toll roads, hospitals, gas pipelines, prisons, oil exploration businesses, and a coal-fired power plant.

Alternative investments like infrastructure projects return higher yields than stocks or bonds. Operating fees are as much as triple those from fixed-income investments, making them lucrative for BlackRock as well. BlackRock’s 2013 annual report featured a section called “The Infrastructure Opportunity,” explaining how its prodigious funds—in particular, pension funds—could fill the gap governments needed to modernize and upgrade their public works.

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To make an infrastructure play work, you need a willing government partner. When Peña Nieto took power in Mexico, nearly half of his expressed commitments involved using private capital for infrastructure, including $590 billion in public-private partnerships. BlackRock praised his boldness: “Mexico is an incredible growth story,” Fink said in 2013. “If I were 22 years old and I didn’t know what I wanted to do, I would move to Mexico right now because I think the opportunity is huge there,” he later added.

The opportunity was indeed huge, if you happened to be BlackRock. The firm benefited from the controversial opening of PEMEX, the state-run oil monopoly, to private investment. Within seven months, BlackRock had secured $1 billion in PEMEX energy projects. In June 2015, BlackRock acquired a scandal-ridden Mexican private equity firm called I Cuadrada for $71 million. A month later, Sierra Oil and Gas, a year-old portfolio company of I Cuadrada that had never drilled an oil well, won two major exploration contracts from PEMEX. Sierra was the only bidder.

In another suspicious deal, a contractor named Grupo Tradeco continually missed deadlines for building a private prison in Coahuila state, with accusations of 2.5 billion pesos in waste. But right before BlackRock bought the project, Peña Nieto increased the construction payments for the prison by 18 percent. A third deal involved BlackRock purchasing a contract to build a toll road between Toluca and Naucalpan. A month later, Peña Nieto signed an executive order to resolve a legal dispute over siting the road through what indigenous groups consider sacred land, expropriating 91 acres for the project.

Clearly, BlackRock benefited from its ties to Mexican officials and luminaries. The son of Carlos Slim, Mexico's richest man, is a BlackRock board member. Mexico’s former undersecretary of finance, Gerardo Rodriguez Regordosa, became a managing director in 2013. The CEO of BlackRock Mexico, Isaac Volin, was previously a national bank regulator, and in 2016 he became the general director of a PEMEX subsidiary. Peña Nieto himself met with Larry Fink prior to his election and numerous times afterward.

In addition,

BlackRock exploited changes in Mexican law allowing asset managers to take control of Mexican pension funds.

By placing hundreds of millions of dollars in pension money into its Mexican infrastructure business, BlackRock puts Mexico's state and local governments in an impossible position, says Josh Rosner, an adviser to the BlackRock Transparency Project and co-author of the report.

“If a BlackRock-owned infrastructure project becomes ‘a road to nowhere,' and the government wants to stop funding the project, BlackRock can put the official over a barrel and say, ‘You're putting a loss on pensioners,'” Rosner says. “This would force the public official to choose between a waste of public monies and the risk that they would suffer a political loss of voters.” Such an arrangement virtually guarantees conflicts of interest, and possible corruption, in these projects.

BlackRock's shopping spree in Mexico could be threatened by the July election of leftist Andrés Manuel López Obrador. AMLO, as he's often nicknamed, singled out the PEMEX deal with Sierra Oil and Gas, referring to BlackRock as “the white-collar financial mafia” on Facebook. AMLO’s handpicked energy minister, Rocío Nahle García, has called for the removal of Volin from PEMEX, amid what whe termed “marked favoritism” for companies like BlackRock.

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Predictably, BlackRock reacted negatively to the AMLO victory, stating in a “geopolitical risk” report that “deterioration in Mexico’s economic policy” could ensue from it. But its position softened somewhat after a June meeting between AMLO and CEO Fink. So has AMLO’s. He initially promised to reverse all of Peña Nieto’s energy reforms, but now has said he’d merely review PEMEX contracts. And in meetings with BlackRock and dozens of investment funds, AMLO’s top adviser said, “We are really not leftist, we are center-left,” while vowing to stay the course on free trade, central bank independence, and a floating currency.

It seems AMLO has understood what Clinton adviser James Carville learned at the outset of his boss’s presidency: “I used to think if there was reincarnation, I wanted to come back as the president or the pope or a .400 baseball hitter. But now I want to come back as the bond market. You can intimidate everybody.” In Mexico and around the world, a large share of that financier clout is wielded by BlackRock. Such power and influence, often at odds with the public good and combined with potential hazards for the overall financial system, demands additional scrutiny.

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David Dayen

David Dayen is the executive editor of The American Prospect. His work has appeared in The Intercept, The New Republic, HuffPost, The Washington Post, the Los Angeles Times, and more.

 

 

 

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Massive bailout leaves Wall Street giant exposed to fire from all sides

The world’s largest asset manager is sparking concern from U.S. lawmakers in both parties on multiple fronts.

The Federal Reserve building. | Chip Somodevilla/Getty Images

By VICTORIA GUIDA

06/07/2020 07:00 AM EDT

BlackRock, a Wall Street titan that manages $7 trillion in assets, is facing growing scrutiny over its role at the center of the Federal Reserve’s massive bailout of U.S. corporations — and it's coming from all sides.

The world’s largest asset manager is sparking concern from U.S. lawmakers in both parties on multiple fronts, including over its sheer size and market power, its ties to China, its tough stance against companies that contribute to climate change and the extent to which its own bottom line may benefit from the government programs.

The Fed selected BlackRock to run a groundbreaking program to buy hundreds of billions of dollars in debt from large companies slammed by the coronavirus crisis. But the firm's involvement has raised questions about potential conflicts of interest, since it is a dominant player in the markets where the Fed is intervening and can affect how the bond purchases are carried out.

“They’re huge. They have tremendous influence,” Rep. Chuy García (D-Ill.), a member of the Congressional Progressive Caucus, said in an interview. “They’re not bound by the same regulations and rules as banks would be.”

Garcia called for more oversight of the Fed programs so "the public can know who we do business with." The congressional commission charged with overseeing the Fed programs doesn't yet have a chair, but the other members of the panel have pressed the central bank on why it chose BlackRock.

It’s not the first time BlackRock has played a pivotal part in carrying out federal initiatives — it helped manage the toxic assets that the Fed acquired from AIG and Bear Stearns during the last crisis. But the company’s sway over financial markets, and its Washington presence, have ballooned over the past decade.

Under the emergency program that BlackRock is managing, the Fed will purchase debt from companies that borrow through corporate bond markets, making it cheaper for them to tap into more funds. The central bank has already started doing so indirectly, by buying so-called exchange-traded funds that are invested in a group of underlying bonds.

The Fed's contract governing its relationship with BlackRock aims to mitigate any conflicts. Also, BlackRock isn’t directly invested in the assets that the Fed is buying; its clients — institutions and individuals — are, which means the firm has less to directly gain from boosting those assets than would a different type of financial firm, like a bank.

Still, from its perch assisting the Fed, BlackRock will get deep insight into the central bank’s approach to bond markets.

“I don’t think there’s a strong incentive to self-deal, but I do think that BlackRock’s [role] is definitely going to be a boon for the business,” said John Morley, a Yale Law School professor and a leading expert on investment management. “They also have the unparalleled opportunity to develop expertise, develop a business. This is a transformational moment for the Fed, and BlackRock’s now going to be in an even stronger position to serve the Fed in the future.”

BlackRock’s funds are already seeing a boost: According to data compiled by Bloomberg, total assets in its investment-grade corporate bond ETF rose to $46.7 billion on May 19, up from $28.2 billion on March 19. The Fed first announced its plans to buy ETFs on March 23.

BlackRock spokesperson Brian Beades emphasized that the firm will act however the central bank directs it to.

“BlackRock will execute this mandate at the sole discretion of the [Fed], and in accordance with their detailed investment guidelines, in order to provide broad support to credit markets and achieve the government’s objective of supporting access to credit for U.S. employers and supporting the American economy,” Beades said in a statement.

The job is bringing an uncomfortable amount of attention to the company, which, though well-known in the financial world, isn’t a household name.

During a Senate Banking Committee hearing with Fed Chair Jerome Powell this month, Sen. Martha McSally (R-Ariz) suggested that BlackRock's profits from its contract with the central bank could end up enriching Chinese companies, given that the firm manages a range of investments in China.

 

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“BlackRock is one of the leading investment banks in Chinese funds,” McSally said. “What, if anything, will prevent BlackRock from taking their profits that they earn to invest in their interest in China and Chinese state-owned enterprises?”

BlackRock's business model is based on investing and managing funds on behalf of institutions and individuals, rather than making bets with its own money. Powell pushed back on the suggestion that the contract had anything to do with Chinese investments.

“What we're trying to do is create conditions in which U.S. workers can keep their jobs or return to them,” he said. “And that's what our sole focus is; we're not trying to reach out for other public policy objectives or deviate from that.”

Despite BlackRock CEO Larry Fink’s friendly relationship with President Donald Trump, the company has become a target of conservatives after Fink shook the financial world in January by highlighting climate change as a prominent risk and pledging to shift the company’s investing policy to promote economic sustainability.

That has led to fears among Republican lawmakers such as Sen. Ted Cruz of Texas that it might disfavor oil and gas companies in its actions on behalf of the Fed.

“We believe the Federal Reserve should emphasize that … to avoid conflicts of interest, BlackRock must act without regard to this or other investment policies BlackRock has adopted for its own funds,” 17 Republican senators said in an April letter led by Kevin Cramer (R-N.D.) with Cruz among the signatories.

In contrast, nine Democratic senators in late April urged Powell to include climate risks in its considerations of which bonds to buy.

“The timing and scope of climate damages may not fit neatly into existing risk management frameworks, but they will be economy-wide and potentially irreversible,” wrote the lawmakers led by Sen. Brian Schatz (D-Hawaii).

That’s not the only concern raised by Democrats. García, along with eight other House members including Reps. Rashida Tlaib (D-Mich.) and Alexandria Ocasio-Cortez (D-N.Y.), stressed BlackRock’s size and influence in the economy. They argued that the Fed’s selection of the company underscores that it should be subject to more oversight.

“BlackRock is already big, and you must ensure that its work during this crisis doesn’t cement the firm’s structural importance in the global economy and our dependence on it,” the lawmakers wrote in their own letter to Powell and Treasury Secretary Steven Mnuchin.

Under the Obama administration, BlackRock successfully fended off efforts to be placed under the supervision of the Fed, a move that would have ratcheted up regulation under the assumption that the firm's role is so key to markets that its failure could shock the financial system. The asset manager has maintained that its activities aren’t important enough to have that effect.

According to BlackRock’s contract with the New York Fed, the central bank will communicate its goals and strategies for the bond purchases to the firm, which will come up with specifics on how to execute them — plans the Fed will regularly sign off on. To start, BlackRock will earn two cents on every $100 for each purchase.

BlackRock’s own ETFs can't make up a larger share of the Fed’s portfolio than their actual share of the market — currently 50 percent. And the firm will refund the Fed for fees it earns from the central bank’s holdings of its ETFs. According to the latest data released by the Fed, 48 percent of the ETFs it has bought are managed by BlackRock.

Still, the company will be entrusted to determine a fair market price of bonds in an environment where markets won’t necessarily be functioning properly — an area where the firm has extensive expertise and precisely why the Fed has hired it in the first place.

The Fed could have selected smaller asset managers for the job, but “none of those other entities I think would be given this kind of power and brought into the inner circles of financial management in the way that BlackRock is,” said Marcus Stanley, policy director at Americans for Financial Reform, which advocates for tougher rules on Wall Street.

Stanley said BlackRock’s growing relationship with the U.S. government has echoes of Citigroup and Goldman Sachs in decades past, when those firms worked closely with prior administrations and saw former executives ascend to high-level government positions. The point is supported by speculation that Fink has ambitions of becoming Treasury secretary under a future Democratic president.

“BlackRock faces a ton of political risks here that run from [accusations that] BlackRock is pursuing some agenda other than the best interest of the public, to the personal ambitions of Larry Fink,” Morley said.

But Ian Katz, an analyst at Capital Alpha Partners, said the central bank was always going to turn to a private firm to help out with the purchases.

“There’s only so many people in the world who have expertise on these very specific issues,” Katz said. “If you eliminate all the people who are working at big financial services companies, it would be very hard to find the right expertise.”

 

 

 

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Silver Took the Stairs to $21 in 2008, Took Escalator to $29 2010. Is Silver on Elevator to 120th floor today?

Commodities / Gold & Silver 2020 Aug 13, 2020 - 02:34 PM GMT

By: Robert_Singer

Disclaimer: The following is my opinion and is not intended as investment advice. I don’t know anything about bulls, bears, cycles, resistance, daily, weekly, monthly charting, micro or macro fundamentals and especially indicators like the EROI.

I have been waiting for Silver to take off since 2005 when I was sure the economy and the dollar were going to collapse. [1]

The economy should have gone south in 1980 when the Twins showed up. The twin deficits is a phenomenon wherein both the federal government’s balance and that country’s trade balance nosedive into negative territory.

 

Up until 1980 Americans enjoyed the highest standard of living in the Western world because of our ability to import cheap, raw materials (thanks to the CIA) and export refrigerators, cars, airplanes and military hardware to the rest of the world (finished goods).

When the world figured out the game, the Reagan administration embarked upon the greatest export of all: OUR DEBT.

We have been getting away with exporting our debt for over 40 years, but with the reappearance of the Twins and a national debt that since 2010 has been mathematically impossible to pay off, we might be witnessing the final death march of the dollar as the reserve currency of the world. [2]

The recovery when the S&P 500 erased its losses for 2020, accentuating a remarkable stock market comeback, had nothing to do with the expectation of a V-shaped recovery or Trump’s claim:

The “America’s economy is coming back much stronger than ever anticipated by most people, almost all people, because these numbers were – even the most optimistic people, these numbers are being doubled and tripled over what they thought would be possible,”

The Stock Market in 2018

84 percent of all stocks owned by Americans belong to the wealthiest 10 percent of households. And that includes everyone’s stakes in pension plans, 401(k)’s and individual retirement accounts, as well as trust funds, mutual funds and college savings programs like 529 plans.

The Stock Market in 2020

87 percent of all stocks are owned by Blackrock and the Hedge Funds.

Negative-yielding debt, 3.6 trillion dollar fiscal stimulus, eviction moratoriums, riots, chaos and the Covid-19 pandemic; we are entering a time that cannot be compared to any financial crisis in history.

Blackrock in 2019

The firm (ticker: BLK) now manages $7.4 trillion, up nearly $1.5 trillion from last year, according to its latest earnings report, released on Wednesday. More money flowed into BlackRock funds as stocks rose, boosting the value of existing investments. The S&P 500 Index returned more than 30% in 2019, and the MSCI ACWI, an index that represents the world stock market, gained nearly 27%. [3]

There is significant evidence of price manipulation by Blackrock and Hedge funds at the stock level on critical reporting dates. [4]

The S&P and Dow remarkable recovery has everything to do with Blackrock and the hedge funds that own 87% of all equities.

There is significant evidence, but not proof, of price manipulation by Blackrock and Hedge funds at the stock level to buy the stocks the 13% were selling during the Covid-19 pandemic.

The market was about to collapse, manipulation for Blackrock was the only option.

The U.S. has two alternatives to solve our National debt problem: 1) issue our own currency and pay off the debt or 2) repudiate (default) on the debt. [5]

Either alternative will end the reign of the dollar as the reserve currency of the world and launch the Precious Metals to the Moon. The only vehicle for a store of value is Gold and Silver, not a cryptic currency.

The recent rally, that the Gold and Silver Bulls have been predicting for the last 20 years, was the start of something really big and then on Thursday both Silver and Gold took a dive.

I knew something was wrong before the crash/correction because I got a text from a Dow Joneser, and a Never Precious Metaler, “Congratulations, I see that Silver is up over 27/ounce I am very happy for you.”

I did some research and then was convinced the rally had to end when I saw that the New York Times published Gold Goes Mainstream, on July 30

New Gold Rush Pushes Price to Record Highs, something shiny and bright is beckoning investors accustomed to the gloomy days of 2020: gold. The pandemic has pushed the global economy into one of the sharpest downturns on record. The International Monetary Fund predicts that this year, the world economy will shrink by nearly 5 percent. The plunge prompted central banks everywhere, most importantly the Federal Reserve, to pump hundreds of billions of dollars into financial markets, with the goal of propping up flailing economies.

But those billions aren’t coming from a storehouse; rather, central banks are creating fresh currency. The increase in money supply lowers interest rates and raises the amount of a particular currency, such as the dollar, in circulation. And over time, these moves can both increase inflation (lower interest rates typically spur economic activity) and weaken the value of a currency.

Right now, investors are taking all of that into account and determining that buying gold – which is traditionally considered an investment that holds its value over time – is the best thing they can do to shield themselves from inflation and weakening of so-called fiat, or paper, currencies. As a result, money flows into gold investments have surged in recent months as central banks have stepped up their fight against the downturn.

Ney’s first law of financial markets

You don’t need a degree from an Austrian school of economics to predict the crash correction of Gold and Silver and the solid rebound of the U.S. dollar index from its two-year low, all you need to know Ney’s first law of financial markets:

Richard Ney wrote two best-selling books published in 1973. Making it in the Market and The Wall Street Jungle, Ney’s first law of financial markets: A stock, or in this case, gold and silver do not move up or down in price because you buy or sell; You buy or sell because the price of gold or silver moves up or down.

In other words greed motivates people to buy on the euphoria of the price of gold and silver rising and panic causes them to sell. In the case of silver the low price discourages an investment in silver.

Jim Wyckoff’s article, August 07, 2020 at Kitco News, Gold price loses altitude on profit taking headline into the weekend summarizes the situation without Richard Ney or my belief that everything changed in 2015.

(Kitco News) – Remember that bigger upside price moves in up-trending markets tend to see bigger downside corrections. Price corrections in uptrends are actually healthy for the extension of the uptrends. A markets that goes “parabolic” in trading terms (nearly straight up) tends to see the price uptrend in its very late stages, and then a market top is formed. The fact that gold and silver are seeing price corrections in their strong uptrends is healthy for the continuation of the price uptrends.

Of course, it’s natural for the bulls to get a bit queasy when the big downside corrections occur. What is important is that any big downside price corrections do not violate and negate the price uptrend on the chart.

Everything changed in 2015

Ted Butler, one of the foremost experts on Silver had this to say about the last quarter of 2015:

• August 2015 – Market bubbles are rare events, occurring once in a generation. True financial bubbles were the dot-com stock bubble that peaked in 2000, the U.S. housing market in 2005-2006 and today’s stock market in China. Based upon what has transpired in silver over the past four years, I believe that what has been created is a reverse price bubble – the opposite and mirror image of a financial bubble.
• December 30, 2015 -It’s natural to look both back and ahead as the year draws to an end and since I haven’t done a formal year-end review in some time, I’ll do so today for silver and gold. The only difference for this review is that because this year’s price performance and its cause are indistinguishable from silver and gold price performance for the past few years, it is more appropriate to consider this a multi-year review.
• December 23, 2015 – Past and Future – Butler Research Not for a minute am I suggesting that the complete price history of gold and silver dates from 2011; but since the period of time since did represent about the worst price decline ever, it cries out for a full explanation. After all, in many ways the epic decline seemed most unusual given all the circumstances.[Appendix A]

The qualified financial analysts

Financial analysts who study the charts and the recent 6 year trading range, without a 2015 perspective, saw the bull trend off the March low, but the analysis suggested the resistance was still $21:

• Silver price could top out at any point between $18.50 and $20, maybe reach $19.30 before weakening and correcting.
• Silver tends to underperform Gold during most of the precious metal bull markets, and tends to outperform towards the end of powerful bull runs when retail investors start waking up and jumping on board, hence expected a series of spikes higher through resistance levels over the coming years, but not this year.

Their conclusion would have been correct if not for what happened in 2015 that turned the World upside down, and it wasn’t the 2016 election of “The Donald.” Put another way if they had concluded that it was the year of the spikes, then I would be sure I was wrong about 2015.

Stay tuned and if Silver continues without a correction under $21 then I will tell you what happened in 2015 that changed the precious metals and mankind’s destiny.

Disclaimer: The preceding was my opinion and was not intended as investment advice. I am not selling my Silver no matter what happens next week, but again I don’t know anything about bulls, bears, cycles, resistance, daily, weekly, monthly charting, micro or macro fundamentals and especially indicators like the EROI.

Footnotes

[1] Nixon Ends Convertibility of US Dollars to Gold and Announces Wage/Price Controls

August 1971. With inflation on the rise and a gold run looming, President Richard Nixon’s team enacted a plan that ended dollar convertibility to gold and implemented wage and price controls, which soon brought an end to the Bretton Woods System.

[2] The U.S. National Debt in 2010 at 13,561,623,030,891.79 was mathematically impossible to pay off, at the end of March 2020 the debt is $23.7 trillion.

[3] But working behind the scenes, it is much more than that. BlackRock has been called “the most powerful institution in the financial system,” “the most powerful company in the world” and the “secret power.” It is the world’s largest asset manager and “shadow bank,” larger than the world’s largest bank (which is in China), with over $7 trillion in assets under direct management and another $20 trillion managed through its Aladdin risk-monitoring software. BlackRock has also been called “the fourth branch of government” and “almost a shadow government”, but no part of it actually belongs to the government. Despite its size and global power, BlackRock is not even regulated as a “Systemically Important Financial Institution” under the Dodd-Frank Act, thanks to pressure from its CEO Larry Fink, who has long had “cozy” relationships with government officials.

https://www.sott.net/article/436963-Meet-BlackRock-The-New-Great-Vampire-Squid

Net inflows of money were strong, at about $129 billion for the quarter and $429 billion for the year. BlackRock’s fourth-quarter earnings per share rose 43% to an unadjusted $8.29, much higher than the $7.75 analysts had expected, from revenue of $3.98 billion. For the full year, BlackRock earned net income of $4.5 billion, or $28.43 a share, for a 7% gain in EPS from 2018.

[4] https://www.tse-fr.eu/publications/do-hedge-funds-manipulate-stock-prices

We find evidence of significant price manipulation at the stock level by hedge funds on critical reporting dates. Stocks in the top quartile by hedge fund holdings exhibit abnormal returns of 30 basis points in the last day of the month and a reversal of 25 basis points in the following day. Using intraday data, we show that a significant part of the return is earned during the last minutes of the last day of the month, at an increasing rate towards the closing bell. This evidence is consistent with hedge funds’ incentive to inflate their monthly performance by buying stocks that they hold in their portfolios. Higher manipulations occur with funds that have higher incentives to improve their ranking relative to their peers and a lower cost of doing so.

[5] REPUDIATE THE DEBT NOW! http://4brevard.com/tyranny/repudiate.htm

Appendix A

August 2015: Market bubbles are rare events, occurring once in a generation. True financial bubbles were the dot-com stock bubble that peaked in 2000, the U.S. housing market in 2005-2006 and today’s stock market in China. Based upon what has transpired in silver over the past four years, I believe that what has been created is a reverse price bubble – the opposite and mirror image of a financial bubble. A financial bubble involves vastly overvalued prices; a reverse bubble features a shockingly undervalued price. A financial bubble involves vast numbers of participants and reckless leverage, the reverse bubble in silver features only a handful of market participants and little borrowing. Most importantly, it’s just a matter of time before a regular bubble bursts with crashing prices, while in a reverse bubble it is inevitable that prices will explode

December 30, 2015 – Review and Outlook

Review and Outlook, It’s natural to look both back and ahead as the year draws to an end and since I haven’t done a formal year-end review in some time, I’ll do so today for silver and gold. The only difference for this review is that because this year’s price performance and its cause are indistinguishable from silver and gold price performance for the past few years, it is more appropriate to consider this a multi-year review.

December 23, 2015 – Past and Future – Butler Research

The first demand we must all make when considering whether an explanation or a prediction for what may unfold in the future is plausible or not, is whether that same explanation is consistent and in conformity with what occurred in the past. In other words, if someone gives you a price target on gold or silver based on a premise that bears no connection with past price history, skepticism would be in order. The future is always unknown, but the past is there for all to see.

Therefore, if a premise of the future is not compatible with the past, such a premise would be lacking in substance. In the case of gold and silver, any plausible prediction for what lies ahead must also explain what occurred over the past four and a half years, in which gold and silver prices fell 40% and 70%, respectively, from the price highs set in 2011. Not for a minute am I suggesting that the complete price history of gold and silver dates from 2011; but since the period of time since did represent about the worst price decline ever, it cries out for a full explanation. After all, in many ways the epic decline seemed most unusual given all the circumstances.

By Robert Singer

Robert Singer writes about Secrets, Sentient Creatures and The Federal Reserve at The Peoples Voice and The Market Oracle (rds2301@gmail.com)

Robert Singer is an Entrepreneur and the author of a forthcoming book on the Federal Reserve. His articles cover politics and the financial and environmental implications of our consumer society. 

© 2020 Copyright Robert Singer - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

 

 

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BlackRock: The secret world power

The US financial crisis may officially be over, but one specter still spooks regulators: shadow banking. In their struggle to exorcise industry demons, one name looms large, BlackRock. Miriam Braun reports from New York.

The BlackRock headquarters in New York

One name has been haunting Wall Street for years. Still, it remains a mystery to most. Even Heike Buchter admits it only began appearing on her radar recently. "Bankers started talking about [it]. They were analyzing central bank portfolios, and the name Larry Fink kept popping up," the German correspondent, who's been covering Wall Street for more than a decade, told DW.

It stuck with Buchter, who set out to find out all she could about Fink and his financial colossus BlackRock - "one of the world's preeminent asset management firms," as the New York-based corporation boasts on its website.

"Prior to the financial crisis I was not even familiar with the name. But in the years after the Lehman [Brothers] collapse [in 2008], BlackRock appeared everywhere. Everywhere!," Buchter said. On Monday, her 280-page exposé - the first-ever of its kind - appears in German.

Lack of transparency

The author recalls a lunch with an insider. He asked her, only half-jokingly, to speak quietly. He was concerned someone from BlackRock might be hiding in the kitchen, spitting in his soup. Accordingly, she titled the first chapter in her book: "The most powerful company no one's heard about."

BlackRock manages $4.7 trillion (4.2 trillion euros) worth of assets. All told, their platforms juggle $14 trillion - the equivalent of 5 percent of all financials assets worldwide. But BlackRock's reach goes further than just buying and holding stocks and bonds.

"BlackRock advises central banks, financial ministries, big investors like state funds, pension funds, insurance companies and foundations," said Buchter. Tapping into these bonds and stocks, they invest in firms around the world. "There is pretty much nothing in the financial market that Blackrock is not somehow involved in."

BlackRock is a big player on Wall Street

The web that spans the globe

From their unassuming headquarters in Midtown Manhattan, Larry Fink and his managers pull strings all over the world. In addition to holding huge stakes in big US banks, they control significant shares of defense contractors as well as oil- and gas corporations. All funds combined, BlackRock is also the biggest stockholder on the German DAX blue chip market index.

This is not dangerous per se, said Buchter. But, she added, BlackRock's size of shares does have the potential to tip the scales of power. "These days, owning four, five or six percent of a company's shares means you're a big-wig. You can call anytime and the boss will talk to you. And it's become totally OK to expect that," the journalist said.

Conflicts of interest

Whether it's producing cars in Germany, mining for iron ore in South America, developing new drugs in the US or gold-mining in Africa - BlackRock's funds profit. But being involved in so many different industries, and in so many different capacities, poses potential conflicts of interests, warns Buchter.

Imagine, for instance, that a company wants to issue bonds, but BlackRock is not only a potential buyer, it's also already a shareholder. "Who would want to get in trouble with someone, who is not only your biggest stockholders but also potentially your biggest creditor?," pondered Buchert.

Laurence "Larry" Fink, BlackRock CEO

From outcast to investment emperor

BlackRock was born in the late 1980s, as a subsidiary of The Blackstone Group, a multinational private equity firm. Larry Fink was made director and CEO, despite having just all but ruined his reputation on Wall Street after costing his previous employer, investment firm First Boston, $100 million making incorrect predictions about interest rates.

In her new book, Buchter writes the following about Fink: "The most powerful man of the modern financial world appears to double as his own accountant." According to her, Larry Fink accomplished something almost unique: "He created his own Wall Street empire in less than three decades," the Wall Street correspondent told DW. "To do that, you need to have a pretty strong ego and tons of ambition.”

The Ghostbusters of Wall Street

The collapse of the Lehman Brothers boosted BlackRock's business. Fink and his managers were known specialists in analyzing portfolios of mortgage backed securities. This came in handy at a moment when investors and bankers were trying their best to do damage-control. In no time, the team, working out of a backroom office, became known as the "Ghostbusters of Wall Street," Heike Buchter writes. Soon, they received calls from the Federal Reserve on a regular basis. Then-Secretary of the US treasury, Timothy Geithner, was on a first-name basis with the BlackRock boss.

Buchter doesn't fault the US regulators for Fink's stealth iron grip on the financial world. "If you only look at the individual businesses BlackRock is involved in, you don't necessarily realize there's a problem," she said. "But add them all up - all the [company's] lines of business and advisory roles - and you end up looking at a massively complex structure, where you have to wonder: Wow, what kind of monster have they created here."

Who's doing what?

Heike Buchter's in-depth account shines a light on BlackRock's vast web of influence and interests: From its shares in German companies to its role in the Greek debt crisis. However, she said, her goal was not to point fingers, but to give the public the opportunity to understand what they're up against. For Buchter, BlackRock serves as an example of how the financial industry at large works.

"People would like to think that this sector is like most other industries, where you can get a clear picture of who's who, and what's what," Buchert explained. But if there's one thing her research taught her, she added, it's that "the financial system is always changing, it is never in a permanent state. And sometimes it is not quite clear, who is doing what." And that, she reasoned, is what has undermined confidence in the system and made people so angry.

 

 

 

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Meet BlackRock, the New Great Vampire Squid

Posted on June 22, 2020 by Ellen Brown

BlackRock is a global financial giant with customers in 100 countries and its tentacles in major asset classes all over the world; and it now manages the spigots to trillions of bailout dollars from the Federal Reserve. The fate of a large portion of the country’s corporations has been put in the hands of a megalithic private entity with the private capitalist mandate to make as much money as possible for its owners and investors; and that is what it has proceeded to do.

To most people, if they are familiar with it at all, BlackRock is an asset manager that helps pension funds and retirees manage their savings through “passive” investments that track the stock market. But working behind the scenes, it is much more than that. BlackRock has been called “the most powerful institution in the financial system,” “the most powerful company in the world” and the “secret power.” It is the world’s largest asset manager and “shadow bank,” larger than the world’s largest bank (which is in China), with over $7 trillion in assets under direct management  and another $20 trillion managed through its Aladdin risk-monitoring software. BlackRock has also been called “the fourth branch of government” and “almost a shadow government”, but no part of it actually belongs to the government. Despite its size and global power, BlackRock is not even regulated as a “Systemically Important Financial Institution” under the Dodd-Frank Act, thanks to pressure from its CEO Larry Fink, who has long had “cozy” relationships with government officials.

BlackRock’s strategic importance and political weight were evident when four BlackRock executives, led by former Swiss National Bank head Philipp Hildebrand, presented a proposal at the annual meeting of central bankers in Jackson Hole, Wyoming, in August 2019 for an economic reset that was actually put into effect in March 2020. Acknowledging that central bankers were running out of ammunition for controlling the money supply and the economy, the BlackRock group argued that it was time for the central bank to abandon its long-vaunted independence and join monetary policy (the usual province of the central bank) with fiscal policy (the usual province of the legislature). They proposed that the central bank maintain a “Standing Emergency Fiscal Facility” that would be activated when interest rate manipulation was no longer working to avoid deflation. The Facility would be deployed by an “independent expert” appointed by the central bank.

The COVID-19 crisis presented the perfect opportunity to execute this proposal in the US, with BlackRock itself appointed to administer it. In March 2020, it was awarded a no-bid contract under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) to deploy a $454 billion slush fund established by the Treasury in partnership with the Federal Reserve. This fund in turn could be leveraged to provide over $4 trillion in Federal Reserve credit. While the public was distracted with protests, riots and lockdowns, BlackRock suddenly emerged from the shadows to become the “fourth branch of government,” managing the controls to the central bank’s print-on-demand fiat money. How did that happen and what are the implications?

Rising from the Shadows

BlackRock was founded in 1988 in partnership with the Blackstone Group, a multinational private equity management firm that would become notorious after the 2008-09 banking crisis for snatching up foreclosed homes at firesale prices and renting them at inflated prices. BlackRock first grew its balance sheet in the 1990s and 2000s by promoting the mortgage-backed securities (MBS) that brought down the economy in 2008. Knowing the MBS business from the inside, it was then put in charge of the Federal Reserve’s “Maiden Lane” facilities. Called “special purpose vehicles,” these were used to buy “toxic” assets (largely unmarketable MBS) from Bear Stearns and American Insurance Group (AIG), something the Fed was not legally allowed to do itself.

BlackRock really made its fortunes, however, in “exchange traded funds” (ETFs). It gained trillions in investable assets after it acquired the iShares series of ETFs in a takeover of Barclays Global Investors in 2009. By 2020, the wildly successful iShares series included over 800 funds and $1.9 trillion in assets under management.

Exchange traded funds are bought and sold like shares but operate as index-tracking funds, passively following specific indices such as the S&P 500, the benchmark index of America’s largest corporations and the index in which most people invest. Today the fast-growing ETF sector controls nearly half of all investments in US stocks, and it is highly concentrated. The sector is dominated by just three giant American asset managers – BlackRock, Vanguard and State Street, the “Big Three” – with BlackRock the clear global leader. By 2017, the Big Three together had become the largest shareholder in almost 90% of S&P 500 firms, including Apple, Microsoft, ExxonMobil, General Electric and Coca-Cola. BlackRock also owns major interests in nearly every mega-bank and in major media.

In March 2020, based on its expertise with the Maiden Lane facilities and its sophisticated Aladdin risk-monitoring software, BlackRock got the job of dispensing Federal Reserve funds through eleven “special purpose vehicles” authorized under the CARES Act. Like the Maiden Lane facilities, these vehicles were designed to allow the Fed, which is legally limited to purchasing safe federally-guaranteed assets, to finance the purchase of riskier assets in the market.

Blackrock Bails Itself Out

The national lockdown left states, cities and local businesses in desperate need of federal government aid. But according to David Dayen in The American Prospect, as of May 30 (the Fed’s last monthly report), the only purchases made under the Fed’s new BlackRock-administered SPVs were ETFs, mainly owned by BlackRock itself. Between May 14 and May 20, about $1.58 billion in ETFs were bought through the Secondary Market Corporate Credit Facility (SMCCF), of which $746 million or about 47% came from BlackRock ETFs. The Fed continued to buy more ETFs after May 20, and investors piled in behind, resulting in huge inflows into BlackRock’s corporate bond ETFs.

In fact, these ETFs needed a bailout; and BlackRock used its very favorable position with the government to get one. The complicated mechanisms and risks underlying ETFs are explained in an April 3 article by business law professor Ryan Clements, who begins his post:

Exchange-Traded Funds (ETFs) are at the heart of the COVID-19 financial crisis. Over forty percent of the trading volume during the mid-March selloff was in ETFs ….

The ETFs were trading well below the value of their underlying bonds, which were dropping like a rock. Some ETFs were failing altogether. The problem was something critics had long warned of: while ETFs are very liquid, trading on demand like stocks, the assets that make up their portfolios are not. When the market drops and investors flee, the ETFs can have trouble coming up with the funds to settle up without trading at a deep discount; and that is what was happening in March.

According to a May 3 article in The National, “The sector was ultimately saved by the US Federal Reserve’s pledge on March 23 to buy investment-grade credit and certain ETFs. This provided the liquidity needed to rescue bonds that had been floundering in a market with no buyers.”

Prof. Clements states that if the Fed had not stepped in, “a ‘doom loop’ could have materialized where continued selling pressure in the ETF market exacerbated a fire-sale in the underlying [bonds], and again vice-versa, in a procyclical pile-on with devastating consequences.” He observes:

There’s an unsettling form of market alchemy that takes place when illiquid, over-the-counter bonds are transformed into instantly liquid ETFs. ETF “liquidity transformation” is now being supported by the government, just like liquidity transformation in mortgage backed securities and shadow banking was supported in 2008.

Working for Whom?

BlackRock got a bailout with no debate in Congress, no “penalty” interest rate of the sort imposed on states and cities borrowing in the Fed’s Municipal Liquidity Facility, no complicated paperwork or waiting in line for scarce Small Business Administration loans, no strings attached. It just quietly bailed itself out.

It might be argued that this bailout was good and necessary, since the market was saved from a disastrous “doom loop,” and so were the pension funds and the savings of millions of investors. Although BlackRock has a controlling interest in all the major corporations in the S&P 500, it professes not to “own” the funds. It just acts as a kind of “custodian” for its investors — or so it claims. But BlackRock and the other Big 3 ETFs vote the corporations’ shares; so from the point of view of management, they are the owners. And as observed in a 2017 article from the University of Amsterdam titled “These Three Firms Own Corporate America,” they vote 90% of the time in favor of management. That means they tend to vote against shareholder initiatives, against labor, and against the public interest. BlackRock is not actually working for us, although we the American people have now become its largest client base.

In a 2018 review titled “Blackrock – The Company That Owns the World”, a multinational research group called Investigate Europe concluded that BlackRock “undermines competition through owning shares in competing companies, blurs boundaries between private capital and government affairs by working closely with regulators, and advocates for privatization of pension schemes in order to channel savings capital into its own funds.”

Daniela Gabor, Professor of Macroeconomics at the University of Western England in Bristol, concluded after following a number of regulatory debates in Brussels that it was no longer the banks that wielded the financial power; it was the asset managers. She said:

We are often told that a manager is there to invest our money for our old age. But it’s much more than that. In my opinion, BlackRock reflects the renunciation of the welfare state. Its rise in power goes hand-in-hand with ongoing structural changes; in finance, but also in the nature of the social contract that unites the citizen and the state.

That these structural changes are planned and deliberate is evident in BlackRock’s August 2019 white paper laying out an economic reset that has now been implemented with BlackRock at the helm.

Public policy is made today in ways that favor the stock market, which is considered the barometer of the economy, although it has little to do with the strength of the real, productive economy. Giant pension and other investment funds largely control the stock market, and the asset managers control the funds. That effectively puts BlackRock, the largest and most influential asset manager, in the driver’s seat in controlling the economy.

As Peter Ewart notes in a May 14 article on BlackRock titled “Foxes in the Henhouse,” today the economic system “is not classical capitalism but rather state monopoly capitalism, where giant enterprises are regularly backstopped with public funds and the boundaries between the state and the financial oligarchy are virtually non-existent.”

If the corporate oligarchs are too big and strategically important to be broken up under the antitrust laws, rather than bailing them out they should be nationalized and put directly into the service of the public. At the very least, BlackRock should be regulated as a too-big-to-fail Systemically Important Financial Institution. Better yet would be to regulate it as a public utility. No private, unelected entity should have the power over the economy that BlackRock has, without a legally enforceable fiduciary duty to wield it in the public interest.

_________________________

Ellen Brown is an attorney, chair of the Public Banking Institute, and author of thirteen books including Web of Debt, The Public Bank Solution, and Banking on the People: Democratizing Money in the Digital Age.  She also co-hosts a radio program on PRN.FM called “It’s Our Money.” Her 300+ blog articles are posted at EllenBrown.com.

 

 

 

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BlackRock’s Rise Shows the Dark Direction of Monopoly Capitalism, by Rainer Shea

Image by DonkeyHotey via Flickr

Updated: July 12, 2020

by Rainer Shea
Writer, Dandelion Salad
Rainer Shea: Anti-Imperialist Journalist, June 30, 2020
July 1, 2020

Matt Taibbi concluded that the 2008 Wall Street bailout had “built a banking system that discriminates against community banks, makes Too Big to Fail banks even Too Bigger to Failier, increases risk, discourages sound business lending and punishes savings by making it even easier and more profitable to chase high-yield investments than to compete for small depositors.” In this post-crash environment, the largest financial institutions gained more of a hegemonic grip than ever, with the five biggest banks having come to own almost half the industry by 2015.

With this year’s even larger economic crash, the process of monopolization and financialization has gone several steps further. The re-bailout of Wall Street began last fall, when the Federal Reserve had to respond to the first undeniable indications that another crash was approaching. Since then, the Fed has given out hundreds of billions of dollars in corporate welfare as part of its Covid-19 stimulus package, with the big banks getting the best deals from the bailout. The big banks have also exploited the crisis to gain long-wanted deregulations, with the post-2008 rules on financial risk-taking having recently been lifted.

But the type of monopoly finance capitalism that’s emerged with this latest crash involves more sinister developments than these reinforcements of the power of the biggest banks. The entity that’s benefited the most from the crisis isn’t a traditional bank like Goldman Sachs or JP Morgan, but a corporation called BlackRock—which has been called the world’s largest shadow bank. Since the Fed tapped BlackRock to carry out three government debt-buying programs that relate to the Covid-19 stimulus, the company has made millions off of this job while gaining unparalleled dominance over finance. BlackRock’s pivotal role in the operation was no accident; BlackRock itself authored the plan for a bailout before there even was a crisis.

The initial implication of BlackRock’s facilitation of the Fed’s pandemic response is what Pepe Escobar has called the “Wall Street-ization of the Fed.” The plan behind this, as Escobar explains, is essentially a scheme to consolidate the economy so that BlackRock can increase its profits and its leverage over industry:

“Wall Street has turned the Fed into a hedge fund. The Fed is going to own at least two thirds of all U.S. Treasury bills wallowing in the market before the end of the year. The U.S. Treasury will be buying every security and loan in sight while the Fed will be the banker — financing the whole scheme. So essentially this is a Fed/Treasury merger. A behemoth dispensing loads of helicopter money — with BlackRock as the undisputable winner. BlackRock is widely known as the biggest money manager on the planet. Their tentacles are everywhere. They own 5% of Apple, 5% of Exxon Mobil, 6% of Google, second largest shareholder of AT&T (Turner, HBO, CNN, Warner Brothers) — these are just a few examples. They will buy all these securities and manage those dodgy special Purpose Vehicles (SPVs) on behalf of the Treasury.”

Both financially and politically, BlackRock has become the dominant force of the corporatocracy. BlackRock is bigger than Goldman Sachs, JP Morgan and Deutsche Bank combined, and it’s a major donor to both Republican and Democratic candidates. Now that it’s the operating system of the Fed and the Treasury, it holds a monopoly on the currency system of the United States; since it controls how the money is distributed, it controls who gets the money.

Of course, this doesn’t mean that federal aid will now exclusively go to the big banks and corporations. But it represents a shift towards a dark phase in monopoly capitalism, one where BlackRock and its political and business partners use their newly consolidated economic control to further the process of neoliberal inequality. While the country’s crises bring profits for the ruling circle of business elites in Wall Street and Silicon Valley, the people at large are falling into poverty and being exploited more. The job market has shrunk as tens of millions have permanently become unemployed, and all the household debt that working class people have accumulated since the Great Recession is becoming far less manageable. In addition to the big banks, the only winners are the big companies that can save money on shrunken labor costs, or that can profit from the pandemic in various ways.

BlackRock, with its dominance over the system’s means of financial distribution, represents the structural foundation of the global corporatocracy that’s oppressing people within and outside of the imperial core. In Imperialism, the Highest Stage of Capitalism, Lenin described finance capital as serving the central function of generating profits from imperialist exploitation. So the big financial institutions serve the role of the empire’s engine for transferring wealth upward to the ruling oligarchy, with BlackRock now being the dominant facet of the great financial machine.

“Finance capital, concentrated in a few hands and exercising a virtual monopoly, exacts enormous and ever-increasing profits from the floating of companies, issue of stock, state loans, etc., strengthens the domination of the financial oligarchy and levies tribute upon the whole of society for the benefit of monopolists,” Lenin wrote in Finance Capital and the Financial Oligarchy. “Here is an example, taken from a multitude of others, of the business methods of the American trusts, quoted by Hilferding. In 1887, Havemeyer founded the Sugar Trust by amalgamating fifteen small firms, whose total capital amounted to 6,500,000 dollars. Suitably ‘watered’, as the Americans say, the capital of the trust was declared to be 50 million dollars. This ‘overcapitalisation’ anticipated the monopoly profits, in the same way as the United States Steel Corporation anticipates its monopoly profits in buying up as many iron ore fields as possible.”

The modern versions of those trusts are using similar methods to gain an unprecedented amount of control over the economy, and to accelerate the decline of living standards for everyone but the rich. The only thing the working class has to look forward to is a “gig economy” where housecleaning, delivery service, and what remains of retail are the main employment options, while unemployment remains so high that you’re lucky if you can get a job. This will be exacerbated by the coming austerity measures, which BlackRock’s Trump administration allies aim to carry out. The climate crisis, which BlackRock is hugely contributing to, will be the next phase in the pushing of Americans and others towards Third World conditions; storms, floods, and droughts are expected to drive over 100 million people into poverty by 2030 alone.

BlackRock has emerged as the top player in this brutal late-stage neoliberal order, a “vampire squid” that profits from the intensifying exploitation of the proletariat and the overall decay of society. The fact that it’s now the central part of American capitalism has exposed our system for what it is: a plutocracy that’s slowly imploding in on itself and feeding off of the resulting carnage.

Rainer uses the written word to deconstruct establishment propaganda and to promote meaningful political action. His articles can also be found at Revolution Dispatch.

If you appreciate my work, I hope you become a one-time or regular donor to my Patreon account. Like most of us, I’m feeling the economic pinch during late-stage capitalism, and I need money to keep fighting for a new system that works for all of us. Go to my Patreon here. Follow Rainer on Facebook, Twitter, Youtube and Medium.

Updated: July 12, 2020

How BlackRock exploited the COVID-19 pandemic

by Ellen Brown
Writer, Dandelion Salad
The Web of Debt Blog, July 11, 2020
July 12, 2020

RT America on Jul 2, 2020

As the country is distracted by the COVID-19 pandemic, another “too big to fail” asset manager which handles more than $7 trillion in direct management and another $20 trillion through its proprietary software, BlackRock, is coming under scrutiny by one investigative author. She’s calling for it to be broken up under antitrust laws. Attorney, author and founder of the Public Banking Institute Ellen Brown joins In Question to discuss.

The Fed and The Big Bank Wealth Heist. Why We Need Public Banking – Ellen Brown

Ellen Brown is an attorney, founder of the Public Banking Institute, and author of thirteen books including Web of Debt and The Public Bank Solution. Her latest book is Banking on the People: Democratizing Money in the Digital Age, published by the Democracy Collaborative. She also co-hosts a radio program on PRN.FM called “It’s Our Money.” Her 300+ blog articles are posted at EllenBrown.com.

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From the archives:

Imperialism Won’t Be Over After The U.S. Empire Falls + Covid-19 Commercialism Is About Undermining Social Cohesion, by Rainer Shea

Meet BlackRock, the New Great Vampire Squid, by Ellen Brown

Chris Hedges: The Real Looting of America

Another Bank Bailout Under the Cover of a Virus, by Ellen Brown

The Economic Collapse Is Going To Get A Lot Worse, by Rainer Shea

Did Congress Just Nationalize The Federal Reserve? No. But… by Ellen Brown

Chris Hedges: The Priorities Are To Bail Out Large Corporations + Hedges on Coronavirus, Climate and What Next?

 

 

 

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BlackRock Authored the Bailout Plan Before There Was a Crisis – Now It’s Been Hired by three Central Banks to Implement the Plan

By Pam Martens and Russ Martens: June 5, 2020 ~

It’s called “Going Direct.” That’s the financial bailout plan designed and authored by former central bankers now on the payroll at BlackRock, an  investment manager of $7 trillion in stock and bond funds. The plan was rolled out in August 2019 at the G7 summit of central bankers in Jackson Hole, Wyoming – months before the public was aware of any financial crisis. One month later, on September 17, 2019, the U.S. Federal Reserve would begin an emergency repo loan bailout program, making hundreds of billions of dollars a week in loans by “going direct” to the trading houses on Wall Street.

The BlackRock plan calls for blurring the lines between government fiscal policy and central bank monetary policy – exactly what the U.S. Treasury and the Federal Reserve are doing today in the United States. BlackRock has now been hired by the Federal Reserve, the Bank of Canada, and Sweden’s central bank, Riksbank, to implement key features of the plan. Three of the authors of the BlackRock plan previously worked as central bankers in the U.S., Canada and Switzerland, respectively.

The authors wrote in the white paper that “in a downturn the only solution is for a more formal – and historically unusual – coordination of monetary and fiscal policy to provide effective stimulus.”

We now understand why, for the first time in history, the U.S. Congress handed over $454 billion of taxpayers’ money to the Fed, without any meaningful debate, to eat losses on toxic assets produced by the Wall Street banks it supervises. The Fed plans to leverage the $454 billion into a $4.54 trillion bailout plan, “going direct” with bailouts to the commercial paper market, money market funds, and a host of other markets.

The BlackRock plan further explains why, for the first time in history, the Fed has hired BlackRock to “go direct” and buy up $750 billion in both primary and secondary corporate bonds and bond ETFs (Exchange Traded Funds), a product of which BlackRock is one of the largest purveyors in the world. Adding further outrage, the BlackRock-run program will get $75 billion of the $454 billion in taxpayers’ money to eat the losses on its corporate bond purchases, which will include its own ETFs, which the Fed is allowing it to buy in the program.

Helicopter money is also spelled out in the BlackRock plan, which explains why simultaneously with the $454 billion Congress carved out for the Fed under the CARES Act, fiscal stimulus was also “going direct” with $1200 checks and direct deposits to the little people of America and Paycheck Protection Program loans and grants “going direct” to small businesses.

One feature of the BlackRock plan that is certain to get wide public pushback in the U.S. is the proposal for central banks to buy stocks (equities). The authors write this:

“Any additional measures to stimulate economic growth will have to go beyond the interest rate channel and ‘go direct’ – [with] a central bank crediting private or public sector accounts directly with money. One way or another, this will mean subsidizing spending – and such a measure would be fiscal rather than monetary by design. This can be done directly through fiscal policy or by expanding the monetary policy toolkit with an instrument that will be fiscal in nature, such as credit easing by way of buying equities. This implies that an effective stimulus would require coordination between monetary and fiscal policy –be it implicitly or explicitly.”

In the United States, approximately 85 percent of the stock market is owned by the richest 10 percent of Americans. Buying stocks would simply expand and accelerate the wealth and income inequality which is already at the highest levels since the 1920s – a time when Wall Street also owned large deposit-taking banks.

The Swiss National Bank, the central bank of Switzerland, where one of the BlackRock authors previously worked, already has massive holdings of individual stocks, including $94 billion in publicly traded stocks in the U.S. according to its March 31, 2020 report that was filed with the Securities and Exchange Commission.

The BlackRock authors of the “Going Direct” plan are the following:

Stanley Fischer: Fischer was Vice Chairman of Citigroup from 2002 to 2005. Citigroup received the largest bailout in global banking history, getting $2.5 trillion cumulatively in revolving loans from the Fed and billions more from taxpayers in the financial crisis of 2007 to 2010. Fischer went from Citigroup to serve as Governor of the central bank of Israel (Bank of Israel) from 2005 to 2013. (He holds dual citizenship in Israel and the U.S.) One year later, Fischer became a Governor on the U.S. Federal Reserve Board, advancing to Vice Chairman on June 16, 2014. He resigned his position at the Fed October 13, 2017 and joined BlackRock as a Senior Advisor in January 2019.

Philipp Hildebrand: Hildebrand was Chairman of the Governing Board of the Swiss National Bank from 2010 until he abruptly resigned in early 2012. (There was a scandal over his wife, a former hedge fund trader, making trades in currencies while he had inside information on interest rates.)  Hildebrand is now Vice Chairman of BlackRock and a member of the firm’s Global Executive Committee.

Jean Boivin: Boivin is the Head of the BlackRock Investment Institute. He joined BlackRock in 2014. Prior to joining BlackRock, Boivin was appointed Deputy Governor of the Bank of Canada in March 2010 where he served for two years. Boivin left the Bank of Canada in October 2012 to become Associate Deputy Minister at the Department of Finance, and to serve as Canada’s Finance Deputy at the G-7, G-20 and the Financial Stability Board.

Elga Bartsch: Bartsch heads up economic and markets research at the Blackrock Investment Institute. Prior to joining BlackRock, Bartsch was Global Co-Head of Economics and Chief European Economist at Morgan Stanley in London. According to the government audit of the Fed’s bailout programs during the 2007-2010 financial crisis, Morgan Stanley was the second largest recipient of the Fed’s bailout programs, behind Citigroup, receiving $2.04 trillion cumulatively in revolving, below-market rate loans.

On May 15, the central bank of Sweden, the Riksbank, announced that it would be using BlackRock to conduct “an analysis of the Swedish corporate bonds market and an assessment of possible design options for a potential corporate bonds asset purchase programme.”

The Bank of Canada announced in April that BlackRock has been hired as an adviser for its commercial paper, provincial bond, and corporate bond buying programs.

The Federal Reserve has given a no-bid contract to BlackRock to manage all of its corporate bond programs.

Peter Ewart, a writer based in Prince George, British Columbia, wrote the following in the Prince George Daily News about BlackRock’s role in herding central bank actions:

“The situation also shows how the economic system in both Canada and the U.S. is not classical capitalism but rather state monopoly capitalism, where giant enterprises are regularly backstopped with public funds and the boundaries between the state and the financial oligarchy are virtually non-existent.”

In the U.S., 30 nonprofits, including Friends of the Earth, U.S. Greenpeace, Public Citizen, Rainforest Action Network, the Sierra Club and Take On Wall Street, wrote a letter to Fed Chairman Jerome Powell on March 27 regarding BlackRock’s role in the bailout. The groups called out the Fed on the following:

“By giving BlackRock full control of this debt buyout program, the Fed is further entwining the roles of government and private actors. In doing so, it makes BlackRock even more systemically important to the financial system. Yet BlackRock is not subject to the regulatory scrutiny of even smaller systemically important financial institutions.”

The groups also assailed the Fed for its “no strings attached” oversight of how BlackRock was spending the money, writing:

“As far as is known publicly, there are no conditions or restrictions on what debt is purchased or what companies must do to qualify for debt purchases outside of their credit rating. This could mean that those companies could engage in stock buybacks or provide enormous CEO compensation packages, despite these practices exacerbating imbalances in corporate balance sheets and being a significant reason why these companies are so susceptible to the current crisis. This also means that industries that actively harm the climate – and by extension the financial system – could get unconditional support…”

BlackRock is not only a major marketer of corporate bond products. Its iShares brand includes a giant roster of stock-based ETFs. The Chairman and CEO of BlackRock is Laurence (Larry) Fink. Reuters reported last July that Fink was lecturing the European Central bank that it “will need to purchase equities to stimulate Europe’s economy, and that leaders should find ways to have investors embrace an ‘equity culture’ there.”

The “equity culture” is code for what Senator Bernie Sanders calls “socialism for the rich, and rugged, you’re on-your-own individualism for everyone else.”

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The economic collapse is going to get a lot worse. Don’t expect your life to return to normal.

Rainer Shea

Apr 30 · 6 min read

The United States and the other core imperialist countries haven’t had socialist revolutions because the masses within them have been kept complacent. They’ve directly or indirectly benefited from the exploitation of colonized peoples, enjoying relative economic advantages despite their being subordinate to the capitalist class. Even as inequality has increased in the last generation or so, this has let the system keep them from taking action. They’ve been told that they need to be loyal to their country, that they can get ahead if they try, that capitalism gives them a better lifestyle than socialism would.

What happens when the comforts of the American people are taken away? As the country passes into the greatest economic unraveling in a century, the system is being confronted with the possibility that a consciousness shift will happen.

To create this shift, we’ll need to accept that the system isn’t going to take us out of our hardship. We won’t get back the decades-low official unemployment levels from earlier this year, or the relative prosperity of the 1990s, or the large American middle class of the mid-20th century. Our living standards, which have been declining for decades under neoliberalism, are going to keep going down.

This is why the Trump White House is still trying to convince people that things will turn around, claiming that the economy will recover rapidly after the quarantines end. In reality, this is far from the worst that conditions will get, and right now they’re far worse than the government admits they are. Around forty million Americans are unemployed, which is almost double the official figure. This makes the nationwide unemployment rate well over 20%, which represents a tipping point for the death of the economy.

In an environment where small businesses are getting rapidly trapped in liquidation and bankruptcy, local business owners are largely not going to revive their operations. And the big companies that have laid off many of their workers largely aren’t going to hire those workers back, simply for the reason that they can greatly cut down on costs by hiring far fewer workers than they did before the virus. If they can keep their operations going now, they’ll be able to continue with this arrangement.

The owners of these big corporate monopolies are pretty much the only ones who will come out of this crisis richer. The workers and the growing masses of unemployed people will be left with nothing but a band-aid stimulus check, and whatever social services they can gain will no doubt be cut by a government that’s eager to impose more austerity. The tech companies that have won out from the pandemic need to maintain a relatively tiny workforce to continue functioning, meaning tens of millions of people will remain out of work so that the CEOs of companies like Google and Amazon can maximize profits.

In this restructured version of neoliberalism, those lucky enough to find work will more likely than before have to participate in the “gig economy.” Service jobs like home delivery and housecleaning, the remaining retail jobs, and other lower-wage work opportunities will become more normalized. The alternatives to these things will be homelessness, a criminal lifestyle, or a desperate attempt to live off of welfare.

This situation has already become the reality for at least half of the country’s population, since around 50% of Americans are poor by the modern definition. But as the factors for economic collapse converge, the record household debt that these lower class Americans have accumulated will become even less manageable. There won’t come a time when the opportunities from before the crash reappear for these struggling households, because a depression has come that will likely extend beyond the 2020s.

Big tech has consolidated the job market. Deglobalization is making for a post-pandemic outcome where commerce and trade will be more tightly restricted. A new housing bubble is taking effect, exacerbated by a repeat of the disastrous financial lending schemes that produced the last crash. These crises are creating more developments that will harm the economy long-term, like a collapse in prices for oil and other major industrial commodities, a risk of mass defaults and bankruptcies because of unsustainable mass household debt, and a massive increase in fiscal deficits.

It’s all leading to capitalist societies finding themselves in poverty and disrepair when they confront the crisis that will come from climate change: rising sea levels, intensifying storms, heat waves, severe droughts, abnormal fires, increasing agricultural dysfunctionality, food chain collapses, viruses that are intensified by the shifts in the weather and the degradation of ecosystems. These things aren’t five or ten years in the future, they’re present right now, and they’re impacting us more all the time. The system isn’t going to save us from these things. It will use the military to try to maintain order, leave us to fend for ourselves, and let the rich retreat to their secluded doomsday shelters near the poles or in the American heartland.

This is the role the system has given you as a lower class person: a statistic, one thay can either end up as a servant for the upper class or become another liability to be cast aside. The capitalist class doesn’t care what happens to you; they’ve been crunching the numbers about how many of you will die from Covid-19 if they reopen the economy early. And they’ll take the same approach when the question becomes how many of you will die if left without aid during the climate crisis. You’re only useful to them as far as you can increase their profits. Otherwise you’re completely dispensable.

If this sounds sad, remember that it’s a reality which colonized and Third World people have had to face for centuries. Gazans have long been surrounded by poverty and state violence, Chileans have been living under extreme economic inequality since the U.S.-installed Pinochet dictatorship did its damage, and indigenous peoples on several continents have been experiencing genocide for generations. Naturally, these victims of colonialism and imperialism have long been much more engaged in revolutionary struggle than First Worlders have, and in numerous countries they’ve installed socialist or anti-colonial governments. We’ll need to reach their level of commitment in order to win our own battle for liberation.

Like the colonized and exploited peoples of Cuba did before they carried out a socialist revolution, we have to build a mass movement that can bring down the capitalist state. We must expand organizations which have the goals of decolonizing America and creating a socialist worker-run democracy. We must organize within our communities towards carrying out out civil disobedience and equipping revolutionaries for combat. We must abandon the colonial chauvinist, pro-bourgeois ideas that kept us tethered to the system, then take example from past Marxist-Leninists in how to take the system down.

And to abandon these ideas, we’ll first need to give up hope that we stand something to gain by being loyal to our country or defending capitalism. The material rewards that we’ve enjoyed from participating in the system are disappearing, and being replaced with a new reality that resembles the Third World. Don’t hesitate to disobey the system’s rules, because the system has nothing to offer you in return for your compliance.

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If You Have Any Money, It’s About to Lose (A Lot) of Value

The Federal Reserve is expecting to set inflation at 4%, up from 2%. Inflation can be higher depending on how you calculate it.

 

 

Tim Denning

Aug 13 · 9 min read

Image Credit–robdobi.com

The money you have in your bank account or wallet right now is about to lose a lot of value. This is not something to be fearful of. It’s a concept to understand and learn about, so you can avoid the problem.

It has taken me 10 years of studying money, a career in finance, and many startup failures to understand how money really works, so I can stress less. Only recently did what I’m about to explain to you make sense in a practical way I could implement in the management of my personal finances.

You can learn how to get more done in three hours than most achieve in a week and it won’t matter. Time equals money, yes — but there’s more to it.

You can become a passive income badass too and it won’t matter unless you get what I’m about to explain in the simplest terms you’ve ever heard it.

Every year the inflation target is around 2%. The Federal Reserve in America is looking to change that to 4%, according to CNBC. Other central banks around the world are looking to make similar changes.

The reason why inflation matters to you is that when inflation goes up, prices of the stuff you buy goes up — asset prices go up too. Here’s the killer idea you need to understand:

If you measure inflation from the 1980s, then in reality, until recently, we were already averaging 10% inflation — not the 2% you read everywhere else.

Calculating inflation is controversial, according to Investopedia. Inflation is controversial because if people understood it, they wouldn’t be happy about how much prices are really rising every year.

Whenever a concept in finance is complex, it divides people into two categories:

1. Those who understand it
2. And those who don’t

The second category have the money they earn eroded away.

Those who understand inflation in real terms do incredibly well — I want you to be one of those people, hence this article.

The Simplest Way to Think About Inflation Versus Deflation

Personal finance YouTuber, Graham Stephan, makes the comparison better than many others I’ve heard explain it. I’m going to take some of his concepts and make them even simpler for you.

When you hear inflation, that translates to demand for products and services. When you hear deflation, that translates to less demand for products and services.

When there is more demand for products and services, prices go up and so does inflation. When there is less demand for products and services, prices go down to create more demand again.

Now here’s the mistake I made: you want prices to go down, don’t you?

You want real estate prices to go down. You want stock prices to go down. You want your home loan interest you pay the bank to go down. I get it.

The big idea

If you know your money is worth less in the future then you’ll spend it now.
If you know your money is worth more in the future you won’t spend it.

When people spend their money on products and services then inflation occurs. Businesses revenues go up slightly more — thanks to inflation — and that means they can afford to pay their employees slightly more each year.

When people don’t spend money, deflation occurs. Deflation typically happens around or during a recession. A recession means people lose their jobs, your retirement savings get smashed, and banks who hold your money could face financial trouble like they did in the Global Financial Crisis of 2008. When banks face trouble they get bailed out using your tax dollars.

Or the bank can be forced to do a bail-in. This is where all the deposit holders of the bank have a percentage of their savings taken away to save the bank. As a depositor of a bank, you are legally an unsecured creditor in the event they go down.

When deflation occurs and a lack of spending results, prosperity suffers. The rich get richer and the poor get even poorer, leading to inequality that often leads to social unrest.

Deflation leads people to spend less money and save more. When nobody spends money, the economy suffers and businesses like the ones you and I work for start to fire people.

Now you might think central banks like the Federal Reserve in the US can step in and save the day. (Don’t fight the Fed they say!)

Here’s the difference this time around: the way the Fed manipulate inflation, mostly, is through adjusting interest rates. With interest rates already at zero or below in most countries, they can’t pull this lever like they normally do.

The Federal Reserve wants inflation because it helps the economy grow again. As the economy grows and inflation goes up, central banks can raise interest rates again to make people spend less money and control inflation. There is another hidden secret of inflation:

Inflation makes the debt you owe go down over time.

People who have debt want inflation for this reason. The Federal Reserve wants inflation because America has $26 trillion worth of debt. As crazy as it sounds, inflation can help the US government pay off its debt — slowly.

Printing money should fix the problem, shouldn’t it?

As we’ve discussed before, governments can print money out of thin air. When you hear that stimulus checks are going to be handed out, that’s just secret handshake talk for “printing money.”

Printing more money should make people spend more. But what if it doesn’t?

What if all the free money that has been and will continue to be handed out isn’t spent, it’s saved? When people are fearful like they are right now, they typically want to save their money, not buy useless consumer goods to get the economy going again.

Printing money is pointless if it doesn’t get spent.

And if a government prints too much money then they create hyper-inflation like what happened in Venezuela when their currency inflated 1,700,000% in 2018.

The argument I get about hyperinflation is this: America has the US dollar which is the world’s reserve currency. In other words, there is a huge demand for dollars. The US is mostly immune to hyperinflation.

Now here’s where things change again. China and Russia are already planning to abandon the US dollar as the reserve currency. Europe has hinted at doing the same many times.

Source: Russia’s Central Bank and Federal Customs Service, Izvestia

So as you can see, the illusion of money printing is probably not the answer.

The Hidden Tax You’re Paying

If you have any amount of money right now you are paying the hidden tax of inflation. If inflation does in fact rise from 2% to 4% like the Federal Reserve is hoping, then that affects your money.

If you go down the rabbit hole of seeing how inflation is actually calculated then you may find that 2%-4% inflation is more like 4%-8% inflation.

Let’s do some numbers. If you have $100,000 dollars in the bank right now then you might be getting 1.5% interest (In Europe you will probably already be getting zero).

Now 1.5% interest sounds good when you don’t understand inflation. The advertisement of being paid interest is false, though. With the target inflation rate previously being 2%, that 1.5% interest you’re getting is actually -0.5% adjusted for inflation. And you still have to pay tax on any bank interest you earn so you’re even more behind than you perhaps thought.

Let’s say you decide that the real inflation rate is closer to 10%, then the interest you’re getting on your bank account may be closer to -6.5%.

Bonds as a replacement for a savings account

You might decide instead to put your money in bonds to earn interest that way. Traditionally that would have been a good idea. Except this time the amount of interest you get on a bond is heading towards zero, too (and perhaps negative).

Bond yields are the truth [of what is happening in the markets] — Raoul Pal

Bond Yields heading towards zero. Source: Bloomberg

Solution

As you can see there are many ways the money you have is losing value. The hard part is finding a solution.

Everyone’s situation is different. What determines how you solve this problem comes down to a few things:

• Your beliefs
• How you see the world
• How you think
• Your goals

There are four asset classes to choose from to fight the value of any money you have losing value:

• 1) Gold 2) Stocks 3) Real Estate 4) Digital currencies

The option(s) you choose is individual to you.

1. You can sit in cash temporarily

In my case, as mentioned recently, I have sold my entire investment portfolio.

I am paying the tax of inflation by sitting in cash. This not only allows me to stress less but it allows the financial markets to have the correction they need. When bond yields are performing badly it’s often a sign of what is to come.

Cash can give you options.
Cash can let you watch the chaos rather than be caught in the middle of it.

2. You can take advantage of inflation

An idea financial guru Graham Stephan brings up is this:

Inflation may *not* be in goods and services. Inflation may be instead present in investments like stocks and real estate.

When there is loads of money being printed, free money being given out, and trillions of dollars looking for a home that will allow growth, assets like property and stocks can benefit from inflation.

Property can have good returns, although it can’t be offloaded easily. It costs money to sell property and if everybody is selling their properties at the same time as you then you might get far less for it.

The challenge with both options is whether a prolonged economic downturn could hold stocks and property prices down if markets collapse like they did in 2008. Nobody knows the answer.

3. You can choose a safe-haven

Another solution to the value of your money going down is to look at gold or digital currencies. They don’t pay you any interest for owning them but they can benefit from uncertain times created by fear from a health crisis.

Older people tend to choose gold. Millennials tend to choose digital currencies. The risk with safe-havens is two-fold.

Gold has underperformed in the long term. There was even evidence to suggest that the gold price was manipulated.

Digital currencies can have capped and predictable inflation rates — but could be banned by governments, rendering them worthless.

4. Choose a combination

The final solution is to combine a few of these strategies. You can diversify amongst a few different assets to get exposure to the upside and risk of each asset type. (There is always risk when there is upside because there is no such thing as a free lunch.)

Crucial Takeaway

The point of me explaining that your money is about to lose a lot more value is so you understand inflation and deflation.

When you hear that inflation is 2% it’s highly possible it’s a lot more.

When the Federal Reserve is likely to double inflation or print even more money, you need to know so you move your money between stocks, gold, digital currencies and real estate, based on your beliefs and view of the world.

How much money you make doesn’t matter. Compound interest is useless if you don’t understand inflation in real terms.

Making passive income like a badass can make you an accidental dumbass if you don’t understand the value of the money you’re earning.

The final point to consider is that if you crave prices to go down (deflation) it could have devastating effects on the society you love and are a part of. Be careful what you wish for.

Work your butt off to understand inflation and deflation, so the value of any money you have doesn’t cause you to lose a lot and have to work harder than you need to.

This article is for informational purposes only, it should not be considered Financial or Legal Advice. Consult a financial professional before making any major financial decisions.

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The Federal Reserve Cartel: The Eight Families

By Dean Henderson

Global Research, June 19, 2020

Region: USA

Theme: Global Economy, History, Oil and Energy

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Of relevance to the current crisis, this carefully researched article was first published by Global Research on June 1, 2011.

(Part one of a four-part series)

The Four Horsemen of Banking (Bank of America, JP Morgan Chase, Citigroup and Wells Fargo) own the Four Horsemen of Oil (Exxon Mobil, Royal Dutch/Shell, BP and Chevron Texaco); in tandem with Deutsche Bank, BNP, Barclays and other European old money behemoths. But their monopoly over the global economy does not end at the edge of the oil patch.

According to company 10K filings to the SEC, the Four Horsemen of Banking are among the top ten stock holders of virtually every Fortune 500 corporation.[1]

So who then are the stockholders in these money center banks?

This information is guarded much more closely. My queries to bank regulatory agencies regarding stock ownership in the top 25 US bank holding companies were given Freedom of Information Act status, before being denied on “national security” grounds. This is rather ironic, since many of the bank’s stockholders reside in Europe.

One important repository for the wealth of the global oligarchy that owns these bank holding companies is US Trust Corporation – founded in 1853 and now owned by Bank of America. A recent US Trust Corporate Director and Honorary Trustee was Walter Rothschild. Other directors included Daniel Davison of JP Morgan Chase, Richard Tucker of Exxon Mobil, Daniel Roberts of Citigroup and Marshall Schwartz of Morgan Stanley. [2]

J. W. McCallister, an oil industry insider with House of Saud connections, wrote in The Grim Reaper that information he acquired from Saudi bankers cited 80% ownership of the New York Federal Reserve Bank- by far the most powerful Fed branch- by just eight families, four of which reside in the US. They are the Goldman Sachs, Rockefellers, Lehmans and Kuhn Loebs of New York; the Rothschilds of Paris and London; the Warburgs of Hamburg; the Lazards of Paris; and the Israel Moses Seifs of Rome.

CPA Thomas D. Schauf corroborates McCallister’s claims, adding that ten banks control all twelve Federal Reserve Bank branches. He names N.M. Rothschild of London, Rothschild Bank of Berlin, Warburg Bank of Hamburg, Warburg Bank of Amsterdam, Lehman Brothers of New York, Lazard Brothers of Paris, Kuhn Loeb Bank of New York, Israel Moses Seif Bank of Italy, Goldman Sachs of New York and JP Morgan Chase Bank of New York. Schauf lists William Rockefeller, Paul Warburg, Jacob Schiff and James Stillman as individuals who own large shares of the Fed. [3] The Schiffs are insiders at Kuhn Loeb. The Stillmans are Citigroup insiders, who married into the Rockefeller clan at the turn of the century.

Eustace Mullins came to the same conclusions in his book The Secrets of the Federal Reserve, in which he displays charts connecting the Fed and its member banks to the families of Rothschild, Warburg, Rockefeller and the others. [4]

The control that these banking families exert over the global economy cannot be overstated and is quite intentionally shrouded in secrecy. Their corporate media arm is quick to discredit any information exposing this private central banking cartel as “conspiracy theory”. Yet the facts remain.

 

The House of Morgan

The Federal Reserve Bank was born in 1913, the same year US banking scion J. Pierpont Morgan died and the Rockefeller Foundation was formed. The House of Morgan presided over American finance from the corner of Wall Street and Broad, acting as quasi-US central bank since 1838, when George Peabody founded it in London.

Peabody was a business associate of the Rothschilds. In 1952 Fed researcher Eustace Mullins put forth the supposition that the Morgans were nothing more than Rothschild agents. Mullins wrote that the Rothschilds, “…preferred to operate anonymously in the US behind the facade of J.P. Morgan & Company”. [5]

Author Gabriel Kolko stated, “Morgan’s activities in 1895-1896 in selling US gold bonds in Europe were based on an alliance with the House of Rothschild.” [6]

The Morgan financial octopus wrapped its tentacles quickly around the globe. Morgan Grenfell operated in London. Morgan et Ce ruled Paris. The Rothschild’s Lambert cousins set up Drexel & Company in Philadelphia.

The House of Morgan catered to the Astors, DuPonts, Guggenheims, Vanderbilts and Rockefellers. It financed the launch of AT&T, General Motors, General Electric and DuPont. Like the London-based Rothschild and Barings banks, Morgan became part of the power structure in many countries.

By 1890 the House of Morgan was lending to Egypt’s central bank, financing Russian railroads, floating Brazilian provincial government bonds and funding Argentine public works projects. A recession in 1893 enhanced Morgan’s power. That year Morgan saved the US government from a bank panic, forming a syndicate to prop up government reserves with a shipment of $62 million worth of Rothschild gold. [7]

Morgan was the driving force behind Western expansion in the US, financing and controlling West-bound railroads through voting trusts. In 1879 Cornelius Vanderbilt’s Morgan-financed New York Central Railroad gave preferential shipping rates to John D. Rockefeller’s budding Standard Oil monopoly, cementing the Rockefeller/Morgan relationship.

The House of Morgan now fell under Rothschild and Rockefeller family control. A New York Herald headline read, “Railroad Kings Form Gigantic Trust”. J. Pierpont Morgan, who once stated, “Competition is a sin”, now opined gleefully, “Think of it. All competing railroad traffic west of St. Louis placed in the control of about thirty men.”[8]

Morgan and Edward Harriman’s banker Kuhn Loeb held a monopoly over the railroads, while banking dynasties Lehman, Goldman Sachs and Lazard joined the Rockefellers in controlling the US industrial base. [9]

In 1903 Banker’s Trust was set up by the Eight Families. Benjamin Strong of Banker’s Trust was the first Governor of the New York Federal Reserve Bank. The 1913 creation of the Fed fused the power of the Eight Families to the military and diplomatic might of the US government. If their overseas loans went unpaid, the oligarchs could now deploy US Marines to collect the debts. Morgan, Chase and Citibank formed an international lending syndicate.

The House of Morgan was cozy with the British House of Windsor and the Italian House of Savoy. The Kuhn Loebs, Warburgs, Lehmans, Lazards, Israel Moses Seifs and Goldman Sachs also had close ties to European royalty. By 1895 Morgan controlled the flow of gold in and out of the US. The first American wave of mergers was in its infancy and was being promoted by the bankers. In 1897 there were sixty-nine industrial mergers. By 1899 there were twelve-hundred. In 1904 John Moody – founder of Moody’s Investor Services – said it was impossible to talk of Rockefeller and Morgan interests as separate. [10]

Public distrust of the combine spread. Many considered them traitors working for European old money. Rockefeller’s Standard Oil, Andrew Carnegie’s US Steel and Edward Harriman’s railroads were all financed by banker Jacob Schiff at Kuhn Loeb, who worked closely with the European Rothschilds.

Several Western states banned the bankers. Populist preacher William Jennings Bryan was thrice the Democratic nominee for President from 1896 -1908. The central theme of his anti-imperialist campaign was that America was falling into a trap of “financial servitude to British capital”. Teddy Roosevelt defeated Bryan in 1908, but was forced by this spreading populist wildfire to enact the Sherman Anti-Trust Act. He then went after the Standard Oil Trust.

Most Americans Don’t Know that the Federal Reserve Banks Are Private Corporations

In 1912 the Pujo hearings were held, addressing concentration of power on Wall Street. That same year Mrs. Edward Harriman sold her substantial shares in New York’s Guaranty Trust Bank to J.P. Morgan, creating Morgan Guaranty Trust. Judge Louis Brandeis convinced President Woodrow Wilson to call for an end to interlocking board directorates. In 1914 the Clayton Anti-Trust Act was passed.

Jack Morgan – J. Pierpont’s son and successor – responded by calling on Morgan clients Remington and Winchester to increase arms production. He argued that the US needed to enter WWI. Goaded by the Carnegie Foundation and other oligarchy fronts, Wilson accommodated. As Charles Tansill wrote in America Goes to War, “Even before the clash of arms, the French firm of Rothschild Freres cabled to Morgan & Company in New York suggesting the flotation of a loan of $100 million, a substantial part of which was to be left in the US to pay for French purchases of American goods.”

The House of Morgan financed half the US war effort, while receiving commissions for lining up contractors like GE, Du Pont, US Steel, Kennecott and ASARCO. All were Morgan clients. Morgan also financed the British Boer War in South Africa and the Franco-Prussian War. The 1919 Paris Peace Conference was presided over by Morgan, which led both German and Allied reconstruction efforts. [11]

In the 1930’s populism resurfaced in America after Goldman Sachs, Lehman Bank and others profited from the Crash of 1929. [12] House Banking Committee Chairman Louis McFadden (D-NY) said of the Great Depression, “It was no accident. It was a carefully contrived occurrence…The international bankers sought to bring about a condition of despair here so they might emerge as rulers of us all”.

Sen. Gerald Nye (D-ND) chaired a munitions investigation in 1936. Nye concluded that the House of Morgan had plunged the US into WWI to protect loans and create a booming arms industry. Nye later produced a document titled The Next War, which cynically referred to “the old goddess of democracy trick”, through which Japan could be used to lure the US into WWII.

In 1937 Interior Secretary Harold Ickes warned of the influence of “America’s 60 Families”. Historian Ferdinand Lundberg later penned a book of the exact same title. Supreme Court Justice William O. Douglas decried, “Morgan influence…the most pernicious one in industry and finance today.”

Jack Morgan responded by nudging the US towards WWII. Morgan had close relations with the Iwasaki and Dan families – Japan’s two wealthiest clans – who have owned Mitsubishi and Mitsui, respectively, since the companies emerged from 17th Century shogunates. When Japan invaded Manchuria, slaughtering Chinese peasants at Nanking, Morgan downplayed the incident. Morgan also had close relations with Italian fascist Benito Mussolini, while German Nazi Dr. Hjalmer Schacht was a Morgan Bank liaison during WWII. After the war Morgan representatives met with Schacht at the Bank of International Settlements (BIS) in Basel, Switzerland. [13]

The House of Rockefeller

BIS is the most powerful bank in the world, a global central bank for the Eight Families who control the private central banks of almost all Western and developing nations. The first President of BIS was Rockefeller banker Gates McGarrah- an official at Chase Manhattan and the Federal Reserve. McGarrah was the grandfather of former CIA director Richard Helms. The Rockefellers- like the Morgans- had close ties to London. David Icke writes in Children of the Matrix, that the Rockefellers and Morgans were just “gofers” for the European Rothschilds. [14]

BIS is owned by the Federal Reserve, Bank of England, Bank of Italy, Bank of Canada, Swiss National Bank, Nederlandsche Bank, Bundesbank and Bank of France.

Historian Carroll Quigley wrote in his epic book Tragedy and Hope that BIS was part of a plan, “to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole…to be controlled in a feudalistic fashion by the central banks of the world acting in concert by secret agreements.”

The US government had a historical distrust of BIS, lobbying unsuccessfully for its demise at the 1944 post-WWII Bretton Woods Conference. Instead the Eight Families’ power was exacerbated, with the Bretton Woods creation of the IMF and the World Bank. The US Federal Reserve only took shares in BIS in September 1994. [15]

BIS holds at least 10% of monetary reserves for at least 80 of the world’s central banks, the IMF and other multilateral institutions. It serves as financial agent for international agreements, collects information on the global economy and serves as lender of last resort to prevent global financial collapse.

BIS promotes an agenda of monopoly capitalist fascism. It gave a bridge loan to Hungary in the 1990’s to ensure privatization of that country’s economy. It served as conduit for Eight Families funding of Adolf Hitler- led by the Warburg’s J. Henry Schroeder and Mendelsohn Bank of Amsterdam. Many researchers assert that BIS is at the nadir of global drug money laundering. [16]

It is no coincidence that BIS is headquartered in Switzerland, favorite hiding place for the wealth of the global aristocracy and headquarters for the P-2 Italian Freemason’s Alpina Lodge and Nazi International. Other institutions which the Eight Families control include the World Economic Forum, the International Monetary Conference and the World Trade Organization.

Bretton Woods was a boon to the Eight Families. The IMF and World Bank were central to this “new world order”. In 1944 the first World Bank bonds were floated by Morgan Stanley and First Boston. The French Lazard family became more involved in House of Morgan interests. Lazard Freres- France’s biggest investment bank- is owned by the Lazard and David-Weill families- old Genoese banking scions represented by Michelle Davive. A recent Chairman and CEO of Citigroup was Sanford Weill.

In 1968 Morgan Guaranty launched Euro-Clear, a Brussels-based bank clearing system for Eurodollar securities. It was the first such automated endeavor. Some took to calling Euro-Clear “The Beast”. Brussels serves as headquarters for the new European Central Bank and for NATO. In 1973 Morgan officials met secretly in Bermuda to illegally resurrect the old House of Morgan, twenty years before Glass Steagal Act was repealed. Morgan and the Rockefellers provided the financial backing for Merrill Lynch, boosting it into the Big 5 of US investment banking. Merrill is now part of Bank of America.

John D. Rockefeller used his oil wealth to acquire Equitable Trust, which had gobbled up several large banks and corporations by the 1920’s. The Great Depression helped consolidate Rockefeller’s power. His Chase Bank merged with Kuhn Loeb’s Manhattan Bank to form Chase Manhattan, cementing a long-time family relationship. The Kuhn-Loeb’s had financed – along with Rothschilds – Rockefeller’s quest to become king of the oil patch. National City Bank of Cleveland provided John D. with the money needed to embark upon his monopolization of the US oil industry. The bank was identified in Congressional hearings as being one of three Rothschild-owned banks in the US during the 1870’s, when Rockefeller first incorporated as Standard Oil of Ohio. [17]

One Rockefeller Standard Oil partner was Edward Harkness, whose family came to control Chemical Bank. Another was James Stillman, whose family controlled Manufacturers Hanover Trust. Both banks have merged under the JP Morgan Chase umbrella. Two of James Stillman’s daughters married two of William Rockefeller’s sons. The two families control a big chunk of Citigroup as well. [18]

In the insurance business, the Rockefellers control Metropolitan Life, Equitable Life, Prudential and New York Life. Rockefeller banks control 25% of all assets of the 50 largest US commercial banks and 30% of all assets of the 50 largest insurance companies. [19] Insurance companies- the first in the US was launched by Freemasons through their Woodman’s of America- play a key role in the Bermuda drug money shuffle.

Companies under Rockefeller control include Exxon Mobil, Chevron Texaco, BP Amoco, Marathon Oil, Freeport McMoran, Quaker Oats, ASARCO, United, Delta, Northwest, ITT, International Harvester, Xerox, Boeing, Westinghouse, Hewlett-Packard, Honeywell, International Paper, Pfizer, Motorola, Monsanto, Union Carbide and General Foods.

The Rockefeller Foundation has close financial ties to both Ford and Carnegie Foundations. Other family philanthropic endeavors include Rockefeller Brothers Fund, Rockefeller Institute for Medical Research, General Education Board, Rockefeller University and the University of Chicago- which churns out a steady stream of far right economists as apologists for international capital, including Milton Friedman.

The family owns 30 Rockefeller Plaza, where the national Christmas tree is lighted every year, and Rockefeller Center. David Rockefeller was instrumental in the construction of the World Trade Center towers. The main Rockefeller family home is a hulking complex in upstate New York known as Pocantico Hills. They also own a 32-room 5th Avenue duplex in Manhattan, a mansion in Washington, DC, Monte Sacro Ranch in Venezuela, coffee plantations in Ecuador, several farms in Brazil, an estate at Seal Harbor, Maine and resorts in the Caribbean, Hawaii and Puerto Rico. [20]

The Dulles and Rockefeller families are cousins. Allen Dulles created the CIA, assisted the Nazis, covered up the Kennedy hit from his Warren Commission perch and struck a deal with the Muslim Brotherhood to create mind-controlled assassins. [21]

Brother John Foster Dulles presided over the phony Goldman Sachs trusts before the 1929 stock market crash and helped his brother overthrow governments in Iran and Guatemala. Both were Skull & Bones, Council on Foreign Relations (CFR) insiders and 33rd Degree Masons. [22]

The Rockefellers were instrumental in forming the depopulation-oriented Club of Rome at their family estate in Bellagio, Italy. Their Pocantico Hills estate gave birth to the Trilateral Commission. The family is a major funder of the eugenics movement which spawned Hitler, human cloning and the current DNA obsession in US scientific circles.

John Rockefeller Jr. headed the Population Council until his death. [23] His namesake son is a Senator from West Virginia. Brother Winthrop Rockefeller was Lieutenant Governor of Arkansas and remains the most powerful man in that state. In an October 1975 interview with Playboy magazine, Vice-President Nelson Rockefeller- who was also Governor of New York- articulated his family’s patronizing worldview, “I am a great believer in planning- economic, social, political, military, total world planning.”

But of all the Rockefeller brothers, it is Trilateral Commission (TC) founder and Chase Manhattan Chairman David who has spearheaded the family’s fascist agenda on a global scale. He defended the Shah of Iran, the South African apartheid regime and the Chilean Pinochet junta. He was the biggest financier of the CFR, the TC and (during the Vietnam War) the Committee for an Effective and Durable Peace in Asia- a contract bonanza for those who made their living off the conflict.

Nixon asked him to be Secretary of Treasury, but Rockefeller declined the job, knowing his power was much greater at the helm of the Chase. Author Gary Allen writes in The Rockefeller File that in 1973, “David Rockefeller met with twenty-seven heads of state, including the rulers of Russia and Red China.”

Following the 1975 Nugan Hand Bank/CIA coup against Australian Prime Minister Gough Whitlam, his British Crown-appointed successor Malcolm Fraser sped to the US, where he met with President Gerald Ford after conferring with David Rockefeller. [24]

*

Dean Henderson is the author of Big Oil & Their Bankers in the Persian Gulf: Four Horsemen, Eight Families & Their Global Intelligence, Narcotics & Terror Network and The Grateful Unrich: Revolution in 50 Countries. His Left Hook blog is at www.deanhenderson.wordpress.com

Notes

[1] 10K Filings of Fortune 500 Corporations to SEC. 3-91

[2] 10K Filing of US Trust Corporation to SEC. 6-28-95

[3] “The Federal Reserve ‘Fed Up’. Thomas Schauf. www.davidicke.com 1-02

[4] The Secrets of the Federal Reserve. Eustace Mullins. Bankers Research Institute. Staunton, VA. 1983. p.179

[5] Ibid. p.53

[6] The Triumph of Conservatism. Gabriel Kolko. MacMillan and Company New York. 1963. p.142

[7] Rule by Secrecy: The Hidden History that Connects the Trilateral Commission, the Freemasons and the Great Pyramids. Jim Marrs. HarperCollins Publishers. New York. 2000. p.57

[8] The House of Morgan. Ron Chernow. Atlantic Monthly Press NewYork 1990

[9] Marrs. p.57

[10] Democracy for the Few. Michael Parenti. St. Martin’s Press. New York. 1977. p.178

[11] Chernow

[12] The Great Crash of 1929. John Kenneth Galbraith. Houghton, Mifflin Company. Boston. 1979. p.148

[13] Chernow

[14] Children of the Matrix. David Icke. Bridge of Love. Scottsdale, AZ. 2000

[15] The Confidence Game: How Un-Elected Central Bankers are Governing the Changed World Economy. Steven Solomon. Simon & Schuster. New York. 1995. p.112

[16] Marrs. p.180

[17] Ibid. p.45

[18] The Money Lenders: The People and Politics of the World Banking Crisis. Anthony Sampson. Penguin Books. New York. 1981

[19] The Rockefeller File. Gary Allen. ’76 Press. Seal Beach, CA. 1977

[20] Ibid

[21] Dope Inc.: The Book That Drove Kissinger Crazy. Editors of Executive Intelligence Review. Washington, DC. 1992

[22] Marrs.

[23] The Rockefeller Syndrome. Ferdinand Lundberg. Lyle Stuart Inc. Secaucus, NJ. 1975. p.296

[24] Marrs. p.53

The original source of this article is Global Research

Copyright © Dean Henderson, Global Research, 2020

 

 

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