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Entries tagged "financial crisis"Page Previous 1 • 2 • 3 Next
October 25, 2011 · By Sam Pizzigati
How much of our income goes to Wall Street? Anthropologist David Graeber, a specialist in the study of debt, recently set out to find out how much of an average American income ends up “appropriated” by the financial industry “in the form of interest payments, fees, penalties, and service charges.”
Graebner would quickly find that no government agency is actually compiling all that exact information. But mortgage and consumer interest charges alone, he discovered from Federal Reserve data, are eating up 15 to 17 percent of average household income, and that figure doesn’t include either student loans or “penalty fees” on bank and credit card accounts.
Overall, Graebner estimates, at least one dollar of every five Americans earn is “now likely to end up in Wall Street’s coffers in one way or another.” That’s substantially more than average Americans pay in federal income tax. Maybe we need some “tax reform” on all the levies Wall Street imposes on us.
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February 3, 2011 · By Robert Alvarez
The dramatic rise in food prices is fueling a great deal of discontent in Tunisia, Egypt and elsewhere. It's a deep undercurrent propelling many of the poor, who face prospects of starvation to resort to the streets and to violence. According to the United Nation's Food Agency (Food and Agriculture Organization -- FAO) world food prices are up for the 7th month in a row and are likely to surpass the record high reached in December 2010.
No end is in sight for this destabilizing battle with food price inflation in places like Egypt, where more than half of an average income goes for food. According to the State Department, more than 60 food riots occurred worldwide over the past two years.
In March 2008, a dramatic spike in food prices led thousands of people on the brink of starvation in Egypt to violently riot -- sending a seismic shock wave through the Mubarak regime. After the Egyptian military was able to distribute enough wheat to dispel the rioting, efforts to stockpile wheat by the Mubarak government have failed, as food prices continue to hover at record highs.
The media is reporting many reasons for this problem ranging from soaring demand, cuts in food subsidies, droughts, and government mandates to use more grain-based biofuel. But, another significant factor is at play: unfettered speculation by investment banks. As noted in USA Today, in 2008, “the bulls may not be running on Wall Street, but they're charging in the commodities pits.”
At issue are the still deregulated commodity markets ushered in by the Clinton administration and the U.S. Congress with the passage of the Commodity Futures Modernization Act of 2000. Before this law, the Commodity Futures Trading Commission (CFTC) served as a cop on the beat, enforcing rules that prevent the distortion or manipulation of prices beyond normal supply and demand. But Wall Street banks and companies such as ENRON and British Petroleum were determined to make a lot more money from speculation by exempting energy-derivative contracts and related swaps from government oversight.
For this reason, the 2000 law allows entities that have no stake in whether adequate amounts of food and fuel are available for ordinary people and commodity-dependent businesses to make huge sums of money by gambling with other people’s money.
Soon after passage of the 2000 law, “dark” unregulated futures trading markets emerged, most notably the Intercontinental Exchange (ICE) in London -- created by Wall Street and European investment banks and several oil companies. A key practice involves “over the counter index trading" in which hundreds of billions of dollars of pension, sovereign wealth, and other institutional funds are used to flood “dark” commodity markets to buy and hold futures contracts without an expiration date or oversight. When it's time to make money on a losing bet, these funds are withdrawn, causing commodity price crashes and economic instability.
These transactions don't involve customary “bona fide” commodity traders, such as an airline company hedging on the price of jet fuel by purchasing futures contracts. As prominent hedge fund manager Michael McMasters noted before a U.S. Senate panel in 2008, this amounts to “a form of electronic hoarding and greatly increases the inflationary effect of the market. It literally means starvation for millions of the world's poor.”
Some world leaders are willing to speak out against the pernicious role of “dark” commodity markets. Recently, French President Sarkozy warned of further unrest and even war at the Davos forum, unless commodity speculation is reined in -- something that Wall Street and Republican lawmakers are bitterly fighting. The Dodd/Frank Financial Reform Law places some restrictions on this practice by the CFTC. In particular, the CFTC is beginning the process of weeding out “non bona fide” investment bank speculators.
True to form, House Republicans are demanding that the CFTC slam on the brakes. They're planning hearings and legislation to hamstring these efforts.
The spontaneous mass uprising of ordinary people in Egypt and the Middle East against their authoritarian regimes has many root causes. One that deserves much greater attention is unfettered speculation by powerful private financial institutions that don't care about world-wide starvation and its impacts. It's distorting global food supplies.
May 21, 2010 · By Netfa Freeman
There couldn’t have been a better conclusion for the Showdown on K Street than with the evening’s DC premiere screening and discussion at Busboys & Poets and organized by IPS. The new documentary, PLUNDER; The Crime of Our Time, by Danny Schechter “looks at the financial crisis, not as a business or a political story, but as a crime story”. And Mr. Schechter (a.k.a. the News Dissector) was in town for the post screening discussion.
The purpose of the event was for us to arm ourselves with what I like to call information ammunition. Building a progressive movement necessarily includes those with arsenals of information and analysis. Because acting thoughtfully is just as important as action oriented thinking. The two are not the same nor does one presuppose the other.
Before the event that night Danny did a short radio interview with Dr. Jared Ball, host of Jazz & Justice on WPFW 89.3 FM, which proved to be a very interesting. Check it out and fortify yourself with that.
After a rainy day and people having protested and marched all day we had no idea what kind of turn out to expect for the 9pm event. To our surprise and satisfaction the post Showdown screening was a success. Plunder was a timely and perfect culmination for everything that had taken place. While the film did simplify a lot, it also showed just how complex the crime(s) that had been committed were and how slippery it makes the work of anyone trying to prosecute the criminals. James Early mc’d the event superbly and moderated the post panel discussion in a packed Langston Room. There was also a surprise cameo appearance by Ralph Nader who opened the film with remarks about Danny and the issue of news media integrity.
The panel that followed was energized by Erica Smiley, Southern Regional Organizer for Jobs with Justice and involved in the organizing of the K Street Showdown. IPS fellow and director of the Cities for Progress and Cities for Peace projects, Karen Dolan also spiced up the panel. And, of course there was Danny Schechter, independent filmmaker and TV producer with the award-winning independent company, Globalvision.
This funky little mix was put together to give you a feel for the evening. Take a listen (MP3) at some highlights and enjoy.
May 20, 2010 · By Jennifer Doak
Today's action: Join our allies in urging Congress to support the Feingold-McGovern Bill for a military withdrawal timetable.
To that end, the U.S. is investigating allegations that its soldiers were responsible for the unlawful death of Afghan civilians.
Dennis Kucinich introduces legislation to prohibit killing U.S. citizens without due process, presumably to remind some government organizations they're not above the Constitution.
Elvis Costello is the latest artist to cancel performances in Israel, in solidarity with the Palestinians. "I must believe that the audience for the coming concerts would have contained many people who question the policies of their government on settlement and deplore conditions that visit intimidation, humiliation or much worse on Palestinian civilians in the name of national security," he wrote in an open letter.
Montgomery County, MD passed the nation's first carbon tax.
Your moment of Zen: Blog This Rock's poem of the week.
May 17, 2010 · By Jennifer Doak
A steady rain fell on the large crowd of protesters who gathered at McPherson Square, on K Street. I juggled my umbrella, a camera, and a soggy sign that said "MAKE FINANCE PAY," wishing another pair of arms would magically appear.
Despite the chilly, wet weather, thousands of people – representing groups like the AFL-CIO, SEIU, AFT (link to an article about their Pink Hearts, not Pink Slips campaign), Jobs with Justice, National People's Action, the Other 98%, and many others I didn't catch – chanted, banged drums, and held up banners protesting the K Street lobbyists who've hijacked our democracy.
"K Street is Washington's counterpart to Wall Street," writes our director, John Cavanagh, "and powerful men on both streets have been working hard, in tandem, to preserve our casino economy, our plunder economy, and our military economy."
We marched around a few blocks of K Street closed off for the protest. At the end of the closed-off area there was a giant evil-looking banker, holding a marionette of the Senate building. Boo hiss!
All in all, it was great to see so many people brave the weather to civilly demand their rights. Brian, our friendly neighborhood tech guy, filmed the protest and interviewed a few people about why they were here today. I saw a few news camera crews there too, so hopefully we'll get some key footage up soon. You can see the rest of our photos on Flickr.
Were you at the protest? Tell us about it.