* VIDEO: PUSSY RIOT VERDICT READ, TWO YEARS IN JAIL FOR PUNK ROCKERS
Source: RT
A Moscow court has sentenced three members of Pussy Riot to two years in prison for hooliganism motivated by religious hatred and enmity – read more @ http://on.rt.com/ioe98o
* ‘U.S. SLAMS PUSSY RIOT VERDICT WHILE JAILING MORE THAN ANY NATION’
Source: RT
The jailing of three members of Russian punk band ‘Pussy Riot’ has attracted criticism from across the world, and seen protests in support of the women. US-based journalist Don DeBar says Washington should look closer to home and tidy up its own affairs before judging others.
* DANIEL ELLSBERG: I CONGRATULATE ECUADOR FOR STANDING UP TO A BRITISH EMPIRE TO PROTECT ASSANGE
By Amy Goodman and Juan Gonzales, Democracy Now!
Daniel Ellsberg, the most famous whistleblower in the United States, praises Ecuador for granting political asylum to Julian Assange to avoid extradition to Sweden for questioning over sex crime accusations. “I congratulate Ecuador of course for standing up to the British Empire here, for insisting that they are not a British colony, and acting as a sovereign state ought to act,” said Ellsberg, who leaked the Pentagon Papers in 1971, the secret history of the U.S. involvement in Vietnam. On Thursday, British Foreign Secretary William Hague said Assange would be arrested if he left the embassy, saying Britain is “under a binding obligation to extradite him to Sweden. “[Assange] has every reason to be wary that the real intent here is to whisk him away to America where it really hasn’t been made clear what might be waiting for him.”
December 2006: Julian Assange, a former Australian computer hacker, founds Wikileaks.org. The website aims to provide a platform for whistleblowers to post sensitive and secret political documents while keeping their identity anonymous.
February 2008: Wikileaks exposes Swiss Bank, Julius Baer, for involvement in money laundering. It publishes internal documents to show that the bank was helping clients launder funds via the Cayman Islands. This leads to the first of many legal charges against Wikileaks.
November 2009: Wikileaks releases a comprehensive archive of text pager messages recorded in the US on September 11,2001, the day when hijacked airplanes crashed into the World Trade Center in New York and the Pentagon in Washington. […]
* SEVEN BANKS UNDER INVESTIGATION FOR GLOBAL INTEREST RATE SCANDAL
By Pratap Chatterjee, CorpWatch Blog
Seven international banks have been served with subpoenas over the global interest setting scandal. Barclays, Citigroup, Deutsche Bank, HSBC, JPMorgan Chase, Royal Bank of Scotland and UBS – have been asked to provide relevant “documents and communications” to Eric Schneiderman, the New York attorney-general in collaboration with George Jepsen, Connecticut’s top law enforcement officer.
The scandal involves LIBOR – or the London Inter Bank Offer Rate – a global system of interest rates for $360 trillion in international deposits. While many of these loans are overnight transfers between banks, they affect the price of consumer loans like mortgages, car loans and credit card loans. The rates are set by the British Bankers Association which makes a considered average of rates reported to them verbally by participating bankers. […]
That’s the question Frances Causey’s new documentary “Heist” tries to answer. Rob Cox speaks with her about the film and its premise that Big Business has captured the American political system.
This is from Valencia, Spain today. But you wouldn’t know from watching the media, because they’ve already made the decision not to televise the revolution. Share this widely if you stand in solidarity with our brothers and sisters in Spain, who continue to fight the culture of banking corruption and greed that rules governments worldwide. Coal miners joined by thousands of supporters, marched in protest across Madrid (Spain’s capital), angry at government cuts. Spain is facing austerity across the board, in return for 30 billion Euros to rescue its ailing banks and a year’s grace to reduce its deficit. The Prime Minister is slashing social security and unemployment benefits, while raising taxes. Madrid has only 3.3 million citizen and just look at how many of them are out in the streets protesting. That’s what I call a properly done protest, and I think it’s impossible not to make yourself heard!
* SPAIN’S INDIGNADOS DISTRUBUTE FOOD TO MADRID’S POOR
Source: Aljazeera
[…] “The government should go after the big companies that don’t pay tax and bankers that have committed fraud and have run this country to the ground,” said Pablo Gonzalez, 52, who works for the Madrid regional government. “Instead, we have to pay.”
The aim of the latest package of measures is to chop €65 billion ($79bn) off the budget deficit through 2015, the biggest deficit-reduction plan in recent Spanish history.
Though the increase in sales taxes, which risks slowing consumption and worsening Spain’s recession, will take effect on September 1, other reforms will be left for later in the year, including a plan to speed up the gradual raising of the retirement age from to 65 to 67.
Meanwhile, Economy Minister Luis de Guindos announced the creation of a new mechanism to help Spain’s 17 regions finance themselves more easily. Some, such as Valencia in the east, are finding it increasingly difficult to tap capital markets for much-needed cash.
The latest bout of austerity is prompting widespread opposition, not least from civil servants. In Madrid, several hundred government workers blocked traffic briefly in different parts of the city.
Civil servants – whose wages were cut 5 per cent on average in 2010 in the first round of austerity cuts – are usually paid 14 times a year. The government is now axing an extra payment made just before Christmas. The prime minister, his cabinet and legislators will also suffer the cut. […]
Greeks are the most concerned in Europe about national food security, a recent survey conducted by Eurobarometer shows.
The report, entitled “Europeans’ attitudes towards food security, food quality and the countryside”, reveals that 94 per cent of Greeks are concerned about national food security, more than twice the EU average (43%). Particularly low levels of concern are noticed in the Netherlands (11%) and Denmark (11%).
Greece also stands out as the only EU country where the majority of respondents are very concerned about food safety (61%), with the EU average being 15 per cent. […]
Late last month, Barclay’s Bank, a multinational bank and financial institution based in the United Kingdom, admitted to regulators that it tried to manipulate something called “Libor” before and during the financial crisis in 2008. “Libor” is an acronym for London Inter b ank Offered Rate. It is a rate used as a benchmark for the cost of lending throughout the financial system, and it is also used as a reference rate for a wide range of financial products like car loans, adjustable-rate mortgages, student loans and credit cards.
The Libor is not based on an objective measure of the interest for bank-to-bank loans. It is the average of a daily poll of the Association’s member banks, who give an estimate of the interest rate they think they would pay if they sought to borrow from another bank.
It is supposed to be the way the financial system assesses the overall health of the financial system, because if the banks being polled feel confident about the state of things, they report a low number, because they assume that if they had to borrow from another bank, their cost of borrowing would be low. If member banks feel a low degree of confidence in the financial system, they report a higher interest rate. And from that the Libor is calculated, affecting the interest rate on financial products around the globe.
What has emerged from the Barclay’s Bank inquiry is evidence that banks may have in fact been deliberately manipulating Libor rates for years. The evidence so far is that one arm of a bank responding to the Libor poll would change their number based on what another arm of the same bank wanted — and that other arm could consist of the bank’s traders who make their money on whether the rate goes up or down.
This means that millions of consumers, investers and businesses have been paying the wrong interest rate. Or rather, they haven’t been paying an interest rate that is set according to some legitimate benchmark. Instead they are paying a rate based on a gentlemen’s agreement at financial institutions, a method that practically incentivizes those banks to game the system to maximize their profits.
And remember, the British Bankers Association, the group that is responsible for setting the rate, is not a government agency. It is just a trade group of big banks — Bank of America, JPMorgan Chase and Deutsche Bank and others — whose decisions on such a crucial number are not based on honest accounting or rules or regulatory oversight, but on a gentlemen’s agreement of honesty.
We don’t know just how deep this scandal goes. But the fact is that if a fundamental component of our financial system has been or is being manipulated, we have the right to know about it. Banks are not above the law and they should not be allowed to operate in secrecy, especially when they have a history of taxpayer bailout and when we are forced to rely on them to provide capital for economic growth.
* NEW YORK FED WAS AWARE OF FALSE REPORTING ON RATES
By Micheal J. DeLaMerced and Ben Protess, NYTimes
The Federal Reserve Bank of New York learned in April 2008, as the financial crisis was brewing, that at least one bank was reporting false interest rates.
At the time, a Barclays employee told a New York Fed official that “we know that we’re not posting um, an honest” rate, according to documents released by the regulator on Friday. The employee indicated that other big banks made similarly bogus reports, saying that the British institution wanted to “fit in with the rest of the crowd.”
Although the New York Fed conferred with Britain and American regulators about the problems and recommended reforms, it failed to stop the illegal activity, which persisted through 2009.
British regulators have said that they did not have explicit proof then of wrongdoing by banks. But the Fed’s documents, which were released at the request of lawmakers, appear to undermine those claims.
The revelations fuel concerns that regulators are ill-equipped to police big banks and that financial institutions can game the system for their own purposes. […]
In the aftermath of the Barclays rate-fixing scandal, the most surprising reaction has been from people in the financial sector who fully understand the awfulness of what has happened. Rather than seeing this as an issue of law and order, some well-informed people have been drawn toward arguments that excuse or justify the behavior of the Barclays employees.
This is a big mistake, in terms of both the economics at stake and the likely political impact.
The behavior at Barclays has all the hallmarks of fraud, pure and simple – intentional deception for personal gain, causing significant damage to others.
The Commodity Futures Trading Commission nailed the detailed mechanics of this deception in plain English in its “Order Instituting Proceedings” (which is also a settlement and series of admissions by Barclays). Most of the compelling quotes from traders involved this scandal come from the Order, but too few commentators seem to have read the full document. Please look at it now, if you have not done so already. […]
* DERIVATIVES: THE UNREGULATED GLOBAL CASINO FOR BANKS
Source DEMON • OCRACY.INFO
[…] LONG STORY: A derivative is a legal bet (contract) that derives its value from another asset, such as the future or current value of oil, government bonds or anything else. Ex- A derivative buys you the option (but not obligation) to buy oil in 6 months for today’s price/any agreed price, hoping that oil will cost more in future. (I’ll bet you it’ll cost more in 6 months). Derivative can also be used as insurance, betting that a loan will or won’t default before a given date. So its a big betting system, like a Casino, but instead of betting on cards and roulette, you bet on future values and performance of practically anything that holds value. The system is not regulated what-so-ever, and you can buy a derivative on an existing derivative.
Most large banks try to prevent smaller investors from gaining access to the derivative market on the basis of there being too much risk. Deriv. market has blown a galactic bubble, just like the real estate bubble or stock market bubble (that’s going on right now). Since there is literally no economist in the world that knows exactly how the derivative money flows or how the system works, while derivatives are traded in microseconds by computers, we really don’t know what will trigger the crash, or when it will happen, but considering the global financial crisis this system is in for tough times, that will be catastrophic for the world financial system since the 9 largest banks shown below hold a total of $228.72 trillion in Derivatives – Approximately 3 times the entire world economy. No government in world has money for this bailout. Lets take a look at what banks have the biggest Derivative Exposures and what scandals they’ve been lately involved in. […]
* WE’RE NOT BROKE, JUST TWISTED: EXTREME WEALTH INEQUALITY IN AMERICA
Source: youtube
[…] We’re not broke. Not even close. The United States of America is awash in wealth. Our corporations are holding record trillions in cash. And overall individual wealth in the United States, the Credit Suisse Research Institute reported this past fall, has risen 23 percent since the year 2000, to $236,213 per American adult. […]
[…] Key Tax Facts
15,753: The number of households in 1961 with $1 million in taxable income (adjusted for inflation).
361,000: The number of households in 2011 estimated to have $1 million in taxable income.
43.1: Percent of total reported income that Americans earning $1 million paid in taxes in 1961 (adjusted for 2011 dollars)
23.1: Percent of total reported income that Americans earning $1 million are likely to pay in taxes in 2011, estimated from latest IRS data.
47.4: Percent of profits corporations paid in taxes in 1961.
11.1: Percent of profits corporations paid in taxes in 2011. […]
* FROM PENN STATE TO JPMORGAN CHASE AND BARCLAYS: DESTROYING HIGHER EDUCATION, SAVAGING CHILDREN AND EXTINGUISHING DEMOCRACY
By Henry A Giroux, Truthout
The Freeh report makes clear that there was a concerted attempt to cover-up the acts of a serial predator, Jerry Sandusky, while willfully disregarding the welfare of the children he abused. Given the reporting of the last year, much of this is not news, though the report makes clear the nature and depth of the cover-up, while providing some important new details. While the Freeh report reveals that the cover-up at the top of the Penn State administration “was an active agreement to conceal,” it raises further questions about how the justice system works in this country when it comes to prosecuting the rich and powerful who sink more and more into a bottomless pit of corruption and moral irresponsibility. At his press conference, Louis J. Freeh, when asked if criminal charges should be brought against a number of people, including former President Spanier, replied that “it’s up to others to decide whether that’s criminal.” While Freeh’s reply suggest he is acting cautiously given that some of the people who hired him may be indicted, he unknowingly touches on another related and important issue. That is, justice in America works primarily for the rich and powerful and against the poor and marginalized. And that Freeh’s response or equivocation reveals what is well known – the rich and powerful rarely get prosecuted for their crimes or what The Economist has called “the rotten heart of finance.” Just ask the CEOs who run Barclays, JPMorgan Chase, Citibank, GlaxoSmithKline, and so it goes.
Let’s be clear, what is on trial here is not simply those who colluded to protect the reputation of a storied football program and the reputation of Penn State University, but a society governed by radicalized market-driven values, a survival of the “fittest” (or most ruthless) ethic and an unregulated drive for profit-making regardless of the human and social costs. This is an ethic that now renders many children and young people as disposable, refusing to acknowledge its responsibility to future generations while creating the social, economic and political conditions in which the pain and suffering of young people simply disappears. As a number of recent banking scandals reveal, big money and the institutions it creates now engage unapologetically in massive criminal behavior and corruption, but the individuals who head these corporations extending from JPMorgan Chase Bank to Barclays are rarely prosecuted. […]
Viewpoint: Eliot Spitzer, Matt Taibbi, and Dennis Kelleher
Viewpoint – host Eliot Spitzer, Matt Taibbi, Rolling Stone contributing editor, and Dennis Kelleher, president and CEO of Better Markets, analyze the Libor interest rate–rigging scandal engulfing the banking industry.
How Britain’s rate-fixing scandal might spread—and what to do about it
Source: The Economist
“SINCE we have not more power of knowing the future than any other men, we have made many mistakes (who has not during the past five years?), but our mistakes have been errors of judgment and not of principle.” So reflected J.P. Morgan junior in 1933, in the middle of a financial crisis. Today’s bankers can draw no such comfort from their behaviour. The attempts to rig LIBOR (the London inter-bank offered rate), a benchmark interest rate, not only betray a culture of casual dishonesty; they set the stage for lawsuits and more regulation right the way round the globe. This could well be global finance’s “tobacco moment”.
The dangers of this are obvious. Popular fury and class- action suits are seldom a good starting point for new rules. Yet despite the risks of banker-bashing, a clean-up is in order, for the banking industry’s credibility is shot, and without trust neither the business nor the clients it serves can prosper. […]
* THE COLLAPSING US ECONOMY AND THE END OF THE WORLD
By Paul Craig Roberts, Activist Post
[…] Washington has been at war since October, 2001, when President George W. Bush concocted an excuse to order the US invasion of Afghanistan. This war took a back seat when Bush concocted another excuse to order the invasion of Iraq in 2003, a war that went on without significant success for 8 years and has left Iraq in chaos with dozens more killed and wounded every day, a new strong man in place of the illegally executed former strongman, and the likelihood of the ongoing violence becoming civil war.
Upon his election, President Obama foolishly sent more troops to Afghanistan and renewed the intensity of that war, now in its eleventh year, to no successful effect.
These two wars have been expensive. According to estimates by Joseph Stiglitz and Linda Bilmes, when all costs are counted the Iraq invasion cost US taxpayers $3 trillion dollars. Ditto for the Afghan war. In other words, the two gratuitous wars doubled the US public debt. This is the reason there is no money for Social Security, Medicare, Medicaid, food stamps, the environment, and the social safety net. Americans got nothing out of the wars, but as the war debt will never be paid off, US citizens and their descendants will have to pay interest on $6,000 billion of war debt in perpetuity.
Not content with these wars, the Bush/Obama regime is conducting military operations in violation of international law in Pakistan, Yemen, and Africa, organized the overthrow by armed conflict of the government in Libya, is currently working to overthrow the Syrian government, and continues to marshall military forces against Iran. […]
* FOR SPAIN’S RESCUED BANKERS, THERE WILL BE NO AUSTERITY
Now that Spain has become the fourth country to receive an EU bailout, the question arises why its corrupt bankers are getting away unscathed.
By Jerome Roos, RoarMag
With eurozone finance ministers agreeing late Saturday night to bail out Spain’s failing banks to the tune of 100 billion euros, the root of Europe’s protracted three-year debt crisis is finally revealed for what it always already was: a dramatically over-leveraged financial system that speculated wildly on real estate (in the case of Ireland and Spain) and government bonds (in the case of Greece and Portugal) without any consideration for the possible consequences.
As we have argued repeatedly over the past year, the euro crisis was never about excessive public expenditure; this was a banking crisis from the very start. That reality is now forcefully being driven home to Europe’s suffering population as 100 billion euros in taxpayer money are being put on the line to “rescue” Spain’s failing banking sector. And while the Spanish people suffer the brunt of two years of disastrous austerity measures, the bankers who put them in this mess are still running away with multi-million dollar bonuses.
With 400.000 families having lost their homes since the crisis began and with one in four Spaniards (and over one in two young people) now out of work, there is no doubt the average population is suffering immensely. Earlier this year, Caritas found that 22 percent of Spanish households now live below the poverty line, while another 30 percent are on the brink. As labor rights are being abolished, social safety nets dismantled and public services slashed across the board, a shocking 11 million people suddenly find themselves at risk of falling into poverty. Make no mistake: these are Depression-era figures. […]
* OAKLAND CITY COUNCIL DEMANDS DEBT-SWAP RENEGOTIATIONS WITH GOLDMAN SACHS
By David Dayen, Firedoglake
If the LIBOR scandal did end up hurting local governments to a large degree, you can just add that to the list. Local governments have been easy marks for the financial industry during the last decade, engaging in all kinds of interest rate-swap deals and other vehicles for financing operations. When they turn sour, the locals, not the banks, end up holding the bag.
One city is trying to flip that script. The Oakland City Council unanimously voted to break off a deal with Goldman Sachs, using the city’s leverage to try and get out of the deal that is hurting their taxpayers. The issue concerns a familiar interest rate-swap deal, which financial institutions sell to cities as a way to hedge against higher interest rates, but which have cost cities millions by locking in higher borrowing costs.
The council voted to demand Goldman Sachs to negotiate with the city to get out of a 1998 interest rate-swap deal without having to pay a $15 million penalty. Currently, because of the locked-in rates, the deal is costing the city $4 million a year. Oakland estimates they have lost $17.5 million on the deal so far, and even though the underlying bonds were sold back four years ago, because of that $15 million penalty, the city will have to continue losing money on the deal until 2021.
So the City Council simply voted to terminate the deal. And if Goldman Sachs won’t let Oakland out, the city will stop doing any business with the bank, per the resolution. […]
* THE PARAGUANYAN COUP: HOW AGRIBUSINESS, LANDOWNING AND MEDIA ELITE, AND THE U.S. ARE PAVING WAY FOR REGIONAL DESTABILIZATION
By Francesca Fiorentini, War-Times
It has been nearly two weeks since the parliament of Paraguay orchestrated an institutional coup that removed President Fernando Lugo from power and installed vice president Fernando Franco in his place, a mere 9 months before the next presidential elections.
Reading articles coming out of South America, I have been trying to wrap my head around not just what happened in Paraguay but what it could mean for the region. And I’m afraid it’s not good. When one connects the dots – many of which require further investigation–it suddenly feels as though the gains that countries in the region have made toward multi-lateral cooperation in order to guarantee economic and political sovereignty and are dangerously vulnerable.
I have always been skeptical of claims by Hugo Chavez or even anti-militarist voices here in the region that believe that the U.S. has not let go of its plans for the region in its fulfillment of “Full Spectrum Dominance”—controlling natural resources indirectly through elite puppet governments and directly through the threat of military force. Between the U.S’ refocus on the Middle East and the rise of left-leaning governments in Brazil, Venezuela, Bolivia, Argentina, Ecuador, and Uruguay, the idea of the region falling victim to the kinds of imperial/neoliberal bullying of the 70s, 80s, and 90s seemed both politically overblown and strategically unfeasible.
I am no longer so sure. […]
[…] Beyond simply the old ruling parties wanting to keep their grasp over the country, there are deeper interests at work in the coup against Lugo.
First and foremost is agribusiness. None other than the infamous Monsanto is a major player in Paraguay. The company collects royalties on the transgenic soy and cotton seeds planted throughout Paraguay, and in 2011 it collected $30 billion tax-free. And 40% of the production and refining of Paraguayan soy is owned by private U.S.-based giant Cargill ($100 billion annual profits a year). Again, agribusiness giants in Paraguay enjoy broad protections from Congress and pay no taxes. […]
[…] The results of the Geneva talks on Syria depend on whom you ask.
US Secretary of State Hillary Clinton insists that the principle of “mutual consent” on which a “transitional government” in Syria would be based means President Assad has to go. Russian Foreign Minister Sergey Lavrov, on the contrary, insists the formation of a “transitional government” will be made on an inclusive basis.
Before discussing what it means, let’s stop for a second to grasp the sheer fact: five foreign powers gathered to decide the fate of a country, in the absence of its leader and its people, who never asked them to do anything of the kind, let alone gave any mandate. This is an outrageous breach of international law. And what is even more outrageous is that nobody is concerned or even talking about it. […]
* WHY IS NOBODY FREAKING OUT ABOUT THE LIBOR BANKING SCANDAL
By Matt Taibbi, Rolling Stone
The LIBOR manipulation story has exploded into a major scandal overseas. The CEO of Barclays, Bob Diamond, has resigned in disgrace; his was the first of what will undoubtedly be many major banks to walk the regulatory plank for fixing the interbank exchange rate. The Labor party is demanding a sweeping criminal investigation. Mervyn King, Governor of the Bank of England, responded the way a real public official should (i.e. not like Ben Bernanke), blasting the banks:
It is time to do something about the banking system…Many people in the banking industry are hardworking and feel badly let down by some of their colleagues and leaders. It goes to the culture and the structure of banks: the excessive compensation, the shoddy treatment of customers, the deceitful manipulation of a key interest rate, and today, news of yet another mis-selling scandal.
The furor is over revelations that Barclays, the Royal Bank of Scotland, and other banks were monkeying with at least $10 trillion in loans (The Wall Street Journal is calculating that that LIBOR affects $800 trillion worth of contracts). […]
As was first reported two days ago, and confirmed today, Barclays’ natural response to allegations it single-handedly manipulated the interest rate complex for up to $500 trillion notional in IR-sensitive swaps and other products (it didn’t – everyone else did it too), was to drag everyone into the scandal, starting off with the Bank of England (and about to drag Whitehall into it too), and specifically the man who was next in line for governorship of the English Central Bank: Paul Tucker. What does this mean? Well, as we suggested also two days ago, now that the natural succession path at the BOE has been terminally derailed, it brings up those two other gentlemen already brought up previously as potential future heads of the BOE, both of whom just happened to work, or still do, at… Goldman Sachs: Canada’s Mark Carney or Goldman’s Jim O’Neil. Granted both have denied press speculation they will replace Mervyn King, but it’s not like it would be the first time a banker lied to anyone now, would it (and makes one wonder if this whole affair was not merely orchestrated by the Squid from the get go… but no, that would be a ‘conspiracy theory’.) Yet the fact that Goldman is hell bent on global domination by stretching its tentacles into every monetary policy administration is no secret: it is only a matter of time before GS also runs the English CTRL-P macros. More interesting is that in addition to the BOE, Barclays today also dragged America’s very own Federal Reserve into the fray.
Barclays also said in the document that the lender believed other banks were making Libor submissions that were too low during the credit crunch. “The evidence shows that the intent was to protect Barclays from the unfounded negative perceptions by bringing Barclays Libor quotes closer to the pack but not to affect the ultimate rate,” the bank said.
Barclays also cited subsequent research by the New York Federal Reserve staff members that, according to the lender, concluded that banks’ Libor quotes were systematically below their borrowing rates by 39 basis points after the Lehman bankruptcy. “Barclays own submissions for tenors of 1 month to 1 year Libor were higher than actual Barclays trades on 97% of the occasions when Barclays had actual trades during the financial crisis,” the lender said.
Translating the bolded: the Fed knew all along that Barclays self-reported levels were impossible. And did nothing. Which of course was not an issue until 2 days ago. Now that heads are rolling, it is. […]
* JP MORGAN, BARCLAYS, OTHER BANKSTERS INVESTIGATED FOR MANIPULATED ELECTRICITY MARKETS
By Scarecrow, Firedoglake
The Financial Times reported yesterday that the Staff of the Federal Energy Regulatory Commission (FECR) was investigating a number of electric power marketing affiliates owned by major banks — including JP Morgan Chase, Barclays, Deutsche Bank AG, and others, on charges of manipulating electricity prices. Immediately, reporters starting wondering whether this is like Enron’s antics back in the early 2000s, which ripped off California consumers and decimated California’s flawed electricity markets. I don’t think it’s the same kind of schemes, but we need more information.
FERC is the federal regulator for electricity markets in the US, with jurisdiction over interstate transmission and the grid operations that include the regional power markets. The information is sketchy now, but the Staff alleges that the banks’ power traders were manipulating bids and possible generator operations to increase prices in at least two regional US electricity markets, California and the Midwest ISO region. Reuters, Bloomberg, HuffPo and others then picked up on the story without adding anything on how the alleged manipulation worked, so it’s still unclear exactly what they’re alleged to have done.
The question is, what were these bank-affiliated power traders doing? I’ll get to that in a minute, and it looks like the San Francisco Chronicle picked up a clue, perhaps without knowing it. […]
The Solidarity, Disobedience and Resistance movement take a practical approach to the problems people are facing. They close down motorway tolls, block ticket machines for public transport and reconnect electricity where it has been cut as punishment for not paying taxes.
* LOSING STRENGTH? AN ALTERNATIVE VISION OF SPAIN’S INDIGNADOS
A silent revolution emerges from the underground. Far from losing strength, decentralization has allowed 15-M to become ever more dynamic.
By Marta Sanchez, RoarMag
Is the 15-M movement going invisible? Or is it rather gaining strength in the ‘underground’? The mainstream media keep claiming that the indignados have lost support since last year, that its only success is its ability to bring people together on special dates. Spanish newspaper El Paísconcluded in May 2012 that, one year after the birth of the movement, popular support and sympathy for the indignados had decreased around 13% among the Spanish population, despite the massive mobilizations that took place from the 12th until the 15th of May, commemorating the anniversary of the movement. ABC opened its edition of May 15 stating that “the indignados movement shows less strength on their anniversary.” But the media misses the point. In reality, rather than losing strength, the movement has become stronger, more organized, better coordinated, and supported by the commitment of hundreds of people.
The decentralization of the movement
When May 2011 came to an end, the recently born 15-M movement had to find out how to survive beyond the camp at Puerta del Sol (acampadasol). Thus arose the idea of decentralizing the movement towards the neighborhoods: the ‘toma los barrios‘, or take the neighborhoods, initiative supported and encouraged the creation of assemblies in every neighborhood of Madrid. In this way, the movement went local: since the creation of the neighborhood assemblies on May 28, 2011, around 120 assemblies have been set up, and they coordinate through the Asamblea Popular de Madrid, the popular assembly of Madrid, also known as Asamblea Interbarrios (the inter-neighborhood assembly). As there were many thematic working groups in the original Sol camp, working groups with similar interests were created in most of the neighborhood assemblies, which since then collaborate and coordinate with the general groups from acampadasol.
The objectives of such decentralization aimed, in the first place, to promote direct and participatory democracy in the local sphere, based on an understanding of politics as the art of collectively creating an alternative pattern of social relations, thereby bringing people out of isolation and into a community. A second objective aimed to retake the public sphere, as defined by Habermas, as a place in which political participation is enacted through the medium of talk, the space in which citizens deliberate about their common affairs, hence, an arena of discursive interaction. This interaction is structured through assemblies, which constitute the greatest expression of horizontal organization and democracy from below. The combination of both objectives shows the movement’s efforts in fighting for a ‘real democracy now’ (Democracia Real Ya), which goes in the direction of Daniel Barber’s concept of ‘strong democracy‘, a “normative alternative where citizens are engaged at the local and national levels in a variety of political activities and regard discourse, debate and deliberation as essential conditions for reaching common ground.” […]
* HONG KONG: 400,000 PROTEST INCREASING CHINESE INFLUENCE
Source: BLOTTR
An estimated 400,000 people took to the streets of Hong Kong yesterday (July 1) for the annual demonstration to mark the British handing of control of the city to China 15 years ago.
The mass protest came as Chinese President Hu Jintao swore in Leung Chun-ying as the city’s new top official, a man who many believe is unsuitable for the job.
Protesters held placards, and chanted that Leung should step down, as they demonstrated against what they believe to be the increasing influence of China in Hong Kong. […]
I wrote about the Libor investigation in the current issue of Rolling Stone, in “The Scam Wall Street Learned From the Mafia,” about muni bond bid-rigging. Throughout this spring, while the Carollo bid-rigging case played out in a Manhattan courtroom, negotiations between banks and regulators were going on in this far larger cartel-corruption case. It’s been clear for some time now that a number of players had begun cooperating, and the only question was which bank was going to settle first. […]
[…] This is unbelievable, shocking stuff. A sizable chunk of the world’s adjustable-rate investment vehicles are pegged to Libor, and here we have evidence that banks were tweaking the rate downward to massage their own derivatives positions. The consequences for this boggle the mind. For instance, almost every city and town in America has investment holdings tied to Libor. If banks were artificially lowering the rates to beef up their trading profiles, that means communities all over the world were cheated out of ungodly amounts of money. […]
* ANOTHER DOMINO FALLS IN THE LIBOR BANKING SCAM: ROYAL BANK OF SCOTLAND
By Matt Taibbi, Rolling Stone
[…]The news that RBS is involved comes with a perverse twist. This is from the Times UK:
The bank, which is 82 per cent owned by the taxpayer, is preparing for a political firestorm over the affair because it believes that it has no power to claw back bonuses from the traders responsible. Instead, the expected fines would be borne by the shareholders — largely the Government.
Libor manipulation is a crime that already robs the public to create bonuses for bankers. By artificially lowering interest rates, the banks caused cities, towns, countries, and other public entities to receive smaller returns on their variable-rate investment holdings. If it turns out that taxpayers end up paying the fine for RBS’s crime of robbing taxpayers, how perfect would that be? […]
* GOVERNMENT BY THE BANKS, FOR THE BANKS: THE ESM COUP D’ETAT IN EUROPE
By Ellen Brown, OpEdNews
On Friday, June 29th, German Chancellor Angela Merkel acquiesced to changes to a permanent Eurozone bailout fund–”before the ink was dry,” as critics complained. Besides easing the conditions under which bailouts would be given, the concessions included an agreement that funds intended for indebted governments could be funneled directly to stressed banks .
[T]he eurozone’s bailout fund (backed by taxpayers’ money) will be taking a stake in failed banks.
Risk has been increased. German taxpayers have increased their liabilities. In future a bank crash will no longer fall on the shoulders of national treasuries but on the European Stability Mechanism (ESM), a fund to which Germany contributes the most.
In the short term, these measures will ease pressure in the markets. However there is currently only 500bn euros assigned to the ESM. That may get swallowed up quickly and the markets may demand more. It is still unclear just how deep the holes in the eurozone’s banks are.
The ESM is now a permanent bailout fund for private banks, a sort of permanent “welfare for the rich.” There is no ceiling set on the obligations to be underwritten by the taxpayers, no room to negotiate, and no recourse in court. Its daunting provisions were summarized in a December 2011 youtube video originally posted in German, titled “The shocking truth of the pending EU collapse!“: […]
If you want your crops to bear fruit, you have to feed the soil. Few industries understand that old farming truism better than ag-biotech—the few companies that dominate the market for genetically modified seeds and other novel farming technologies. And they realize that the same wisdom applies to getting what you want in Washington, DC.
According to this 2010 analysis from Food & Water Watch, the ag-biotech industry spent $547.5 million between 1999 and 2009. It employed more than 100 lobbying firms in 2010 alone, FWW reports, in addition to their own in-house lobbying teams.
The gusher continues. The most famous ag-biotech firm of all, Monsanto, spent $1.4 million on lobbying in the first three months of 2012, after shelling out $6.3 million total last year, “more than any other agribusiness firm except the tobacco company Altria,” reports the money-in-politics tracker OpenSecrets.org. Industry trade groups like the Biotechnology Industry Organization and Croplife America have weighed in with $1.8 million and $524,000, respectively. […]
