Adonis Diaries

Posts Tagged ‘Paul Volcker

Any reforms applied to the capitalist financial institutions?

Almost 3 years to the onset of the financial crash of the century and we have the firm conviction that no reforms to the financial institutions have been applied so far.

The International Regulatory Bank has issued a report in June 2010 and proposed a “moderate” attitude to reforms stating: “Instead of attempting to eradicate financial crisis, which is impossible, we have to reduce the frequency and severity of crisis.”

What that means?

How frequently must crisis take place for mankind to suffer and support; and how level of severity is quantified?

Are there any indicators and measuring sticks to appropriate number of crisis and corresponding severity?

Who is supposed to be bearing the brunt of the impending crisis?

Barack Obama wanted to downsize  multinational financial institutions that are “too big to allow them to fail” so that the tax payers should not be obligated to maintain systemic dangerous institutions.

Congress was not pleased with the suggested reforms:  The financial lobby engaged over 1,500 professionals (lawyers, financiers, and politicians) and spent $350 million to “redirect” the project law under discussion.

That amount earmarked for lobbying congress represents less than one per thousand of the 400 billion profit generated in the last semester of 2009. This profit accounts for 38% of the total profit of the USA in that semester.

Let us put things in perspective:

1. First, the four largest banks in the US has 42% of all the assets in 2009 and held 96% of the 300 billion of the derivative products.

2.Second, every day witnesses financial transactions amounting to 5 trillion while the total saving for all the nations is less than 4 trillion per year.

Nobel laureate Joseph Stieglitz reminded us that

Larry Summers and Timothy Geithner (finance minister) were the same individuals who impose deregulation during Clinton and prohibited any interventions in regulating market derivative products.  It is the multinational financial institutions that are “lending” their experts to governments:  Government is claiming to being helpless faced with the shortage of financial experts willing to working for the government”

Paul Krugman, another laureate, wrote: “The ratio of finance profit to the GNP jumped from 4% to 8% in the last two decades, but the resulted in no economic real growth.  The economy was rendered less stable and less performing due to financial deregulation.”

Paul Volcker, ex-chief of the Federal Reserves during Reagan, said: “You don’t find a single American graduating with superior diploma in engineering, math, or physics.  Wall Street has drained all the bright minds into the financial world.”

Paul Volcker is the same guy who predicted that his financial policies during Reagan will let “blood flow knee-deep” in Latin America.  Indeed, most of the Latin States were ravaged by civil wars and internal unrest and upheaval for two decades.

You might think that the financial crisis and its everyday repercussions on unemployment and lower standard of living has dissipated the illusion that “increased financial transactions can be counted as increase in internal market trade“;  this illusion is still maintained by the media at the sold of the multinationals.

There was no real economic growth in the US and Europe in the last 10 years:  Just a big bubble of the illusion of growth.

Bi-Weekly Report (#17) on Lebanon and the Middle East (April 25, 2009)

 

            Every now and then you read optimistic editorials that an agreement between Israel and the Palestinians is very close because the US wants it, this time around.  I heard these optimistic reflection 15 years ago by the Egyptian Ambassador to the USA who later was appointed Foreign Minister.  You are led to believe that a Syrian-Israel accord is already completed and just waiting for a suitable political climate; and we all wonder and worry what “suitable political climate” entails and it has never been but more wars and massacres to Lebanese and Palestinians.

            In the weekly “Jeune Afrique” (Young Africa) the editorial of Bechir ben Yahmed would like you to sit tight and see a wonderful movie of peace achievement unfold in the region no later than two years from now.  Why?  Because the new US Administration has set its mind that the establishment of a Palestinian State is the corner stone for its long range policies in the Middle East and that the European community badly wants this resolution on ground that it can no longer afford to pay for frequent reconstructions in Palestine and Gaza.

Why the US has finally set its mind?  Simply because a panel of 10 illustrious men in US politics has proposed this resolution; they are Brent Scowcroft, Paul Volcker, Zbigniew Brzezinsky, James Wolfensohn, Henry Siegman, and others. What is the ready plan of the US Administration? First, the return of Israel to its 1967 border with “concessions on several parcels of lands”; second, dividing Jerusalem as Capital for the two States; third, the return of Palestinian refugees to the Palestinian State; forth, the admission of Israel of its responsibility and financial compensation by the “World Community”; and finally, the stationing of International Peace Force on the borders. Nothing more and nothing less; see you all how simple and straightforward has this plan boiled down too! 

In the mean time: first, the Palestinians and the Arab States have to recognize a purely Jewish State in their midst; second, the US has to recognize Hamas as a democratically elected party as it recognized the democratically elected ultra racists Netanyahu and Avigdor Lieberman; third, the US has to recognize that Israel has nuclear bombs and missiles that can deliver them and thus has the responsibility not to leave decisions of mass destruction in the hands of foolish racist and Arab hate mongers; and forth, the US has to stop delivering white phosphorous bombs to Israel. The German cargo transporter “Wehr Elbe” discharged 300 containers of military ammunitions in Israel and containing White Phosphorous bombs that caused the outcry of the international community for being dropped consistently on Gaza and burning thousands of Palestinians. What else did these containers deliver? Cluster bombs, you guessed it. Every week a child or a shepherd dies or is maimed in south Lebanon due to the millions of cluster bombs that Israel “delivered” in the last day of the 2006 July War. That is not the end of the story; two other cargo shipments are in the pipelines. Why? The previous Bush Administration has signed an accord with Israel for 25 billion dollars in free military package aids!  President Obama does not want to rescind criminal decisions, as if closing Guantanamo Bay prison is of a lesser magnitude in hypocrisy.

            An Iranian proverb says: “Bolding men dies with a toupee of abundant curly regrets” This proverb squarely applies to Israel ex Ehoud Olmer PM.  For three years, Olmert had the opportunity to sign peace agreement with Syria and establish a Palestinian homeland but he failed to do so.  In his departure farewell he delivered a public testament urging his successor Netanyahu to boldly and courageously grab a historic initiative to that effect. If these decisions had no other alternatives then why has Olmert failed in his responsibility?

            Israel, the US, and the European Union would like the general public to consider Iran the main nemesis for world peace.  They don’t dare say that Pakistan that owns nuclear bombs is falling to a Taliban-like extremism.  They also don’t dare say that the over 300 million Moslems in India are mostly of Shiaa leaning like Iran.

            In Lebanon, over 750 candidates for the Parliamentary election in June 7 deposited $6,000 each to be eligible.  Many withdrew from the race and recovered $1,500; the remaining lost their deposit.  The treasury would be over 3 millions dollars richer.  The New York Times published yesterday that Saudi Arabia is pumping hundreds of millions of dollars to support the government candidates.  Saad Hariri is the medium for receiving and distributing the Saudi dirty money.  Saudi Arabia monarchy would like the government to return as majority even with one candidate.  All the main lists of candidates have been formed by both alliances.

            Today is the official anniversary of the Armenian genocide; the Armenians in Lebanon are not happy that Seniora PM decided to hold a meeting for the cabinet today.  I had posted an essay on the genesis of the Armenian genocide under the title “Cursed Cities: Karss”

Blood all over the floor (December 8, 2008)

It is 1952 and General Douglas Mac Arthur was saying “Our relative decline, our incapacity to conserve our resources, the vertiginous growth of our national debt, and the weight of our financial engagements are putting our next generations at risk”.

It is 1972 and the inflation was rampant; the Midwest farmers were in high debt and Latin America was in acute debt. President Carter order the FED chairman Paul Volcker to contain inflation.

Volcker invited the Wall Street Journal executives for lunch and asked them “When blood is all over the floor, would you guys support my policy?” 

The executives did not hesitate and they were affirmative.

The US returned to a strong dollar policy.

The Midwest farmers sold their farms at peanut prices and Latin America experienced blood shed for half a century, such as genocides, dictatorship, military coups, facilitating the investment of the US multinationals, destroying the equatorial forests, and barbarically excavating raw material mines in Chili and Peru and so on.

The US has been indebted for over half a century at the expense of over two billion people living under the survival level. I have a simple question:

And the question remains|:”why the US should not experience blood on the floor?”

In the nineties, many books were published warning that the premises and practices of “mondialization, or globalization” are volatile and highly flammable.

For example, Danny Roderick (1997), in his “Has globalization gone too far in its way?”, stated that

1. First, eliminating regulations on commerce and investment was premature;

2.  Second, that there was lack of fairness in the practices among the developed and under-developed States.

3. Third, that the US and European quality standards were being forced on States that cannot produce according to the satisfaction of the western nations; that was an excellent excuse for outsourcing and relocating factories in countries with cheaper manpower; the consequence was that all these products could not be exported but into States with the same quality standards.

What would happen if these markets stopped importing?

All the products that are not fit for inner commerce would have to be sold as scrap.

4. Fourth, the coverage of social guarantees was exhausted in the under-developed States and the population left to mend for themselves. The Establishments in the US mocked these warnings since “History has reached an end” and the US economic model was in for ever.

The unemployed in the US have no where to go to die within their family members.

In China, millions of the little people are being forced back into their remote villages. To do what?

Most probably the Chinese out of work in sweat shop factories would die away from urban eyes and far from the media.

The US people have been in debt for a decade to cover all kind of charges because their earnings in the last two decades were lowered constantly while 1% owns one fifth of the US wealth.

I have a simple question “why those blood sucker billionaire capitalists should not have their blood spattering on the floor?”


adonis49

adonis49

adonis49

October 2020
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