Feb 27, 2013

Capitalism Hits The Fan - Background, Notes & Solutions

Background:

On QE (Quantitative Easing): It only helps the rich in the long run

Summary of "Socialism", Keynesian Economics & "Road to Serfdom" (by F.A.Hayek)

On Hayek from BBC Business News

Economics is divided into two large categories called "Micro-Economics" and "Macro-Economics"

Colbert Report On Ayn Rand: Her philosophy is of rational self interest and she states that the purpose of life is in pursuing your own happiness with NO regard for others. (does/can this attitude create corporatism?)

Daily Show: The government investigates trading on non-public information -- unless members of Congress are doing it!

7 Videos & 1 Image that Illustrates Capitalism & the GOP 



Video:

Capitalism Hits the Fan (Video Clip)





Introduction to this video by Bill Moyers:

Economist Richard Wolff believes capitalism has spun out of control, is not salvageable in its current state, and that nothing short of a major systemic overhaul is needed to get America back on track and fix the problems that unraveled our economy.

In his lecture, “Capitalism Hits the Fan,” Professor Wolff dissects the 30-year-old root causes of the recent financial crisis. He explains how a combination of factors — outsourced jobs, flat wages, soaring credit card debt and the biggest corporate profits in history — led to the most severe economic crisis of his lifetime.

“Stressed, exhausted, this is a population that has reached the limits, it cannot carry more debt and it can’t do more work,” Wolff says. “That’s why this is not a temporary problem, this is not a blip along the way. We have reached the limits of the kind of capitalism this society has become.”



Notes

Reasons for flat wages:

1. Computers started replacing workers/labor.
2. American businesses had the whole planet to themselves as everything had been destroyed in WW2. Everyone saw US as the competitor to beat so they started to focus on making everything better or cheaper than the US. So business in the US started shipping jobs abroad i.e. if you can't beat em, join em.
3. More women entered workforce in the 1970s.
4. Immigrants began moving in, in the 70s.

That's why wages stopped rising in the 1970s


To deal with the stopping of rising wages people:

1. Americans started working more hours
2. They started to fuel their spending/consumption with credit - first by using collateral (such as mortgages) then came the credit card.

More details on the financial crisis:

Washington D.C., TARP & Homeowners Nonsense Explained In 3 Videos & 1 Image


The Financial Crisis Explained In 3 Videos (Only one is over 7 minutes)




Possible Solution: Decentralization?

1. Developing Self-Sufficient & Self-Sustaining Local Economies & Businesses

2. Hemp Can Be Used To Make Plastic Stronger Than Steel, Paper, Textiles, Oil, Non-Toxic Medicine, Cement... & Tornado Shelters!

3. Coal Management (Air Filtering Solutions) (Combining 1 & 2 for fast development i.e. hemp towers in city for industrial production and air cleaning and food towers outside of polluted areas.)


Independent/free energy. Oil companies won't like it, but this is possible:

Anyone CAN Harness The Wind For Energy

Cheap to Expensive: Solar Power Solutions (Plus Other Alternative Energy Solutions)

Fast & Cheap Method to Develop Organic Plastics for Everyday Use

Water Filtration Tips & Techniques


More on this general topic in the section Creative Problem Solving {Environment Economics}


Update April 21st 2015: 

The part he leaves out are trade bills that don't protect domestic workers. Since he isn't a domestic worker it's not a major concern for him. The simple reality is that if you are talking about how technology is reducing wages and then are sending jobs to labor intensive countries 'cause labor is cheaper' then you're just being a hypocrite (or incredibly dense, maybe even religiously so)

Related info:




Related post:




Note April 22 2015: On the TPP - To say wages are going down because of technology and then to send jobs overseas for people to do it in other countries who are not robots, is a bad excuse. A lowering of wages in one industry as it declines & another one emerges, is normal economic behavior. To make treaties to allow these new industries to grow in other countries will lead to thier profits and a few corporations of ours (at the expense of their corporations, i.e. it's our rich people vs thier rich people in our trade policies). ON the whole the country sending jobs abroad will lose it's internal stability. Temp jobs isn't a real recovery i.e. one that puts citizens first. If you send manufacturing jobs abroad and then say this is a service economy you're just fooling yourself. All that said, trade does help improve relations. Generally speaking.

Introducing The Death Planes (The Drone War)


Background: 


7 Videos & 1 Image that Illustrates Capitalism & the GOP






 "The nation which indulges towards another a habitual hatred or a habitual fondness is in some degree a slave. It is a slave to its animosity or to its affection, either of which is sufficient to lead it astray from its duty and its interest. Antipathy in one nation against another disposes each more readily to offer insult and injury, to lay hold of slight causes of umbrage, and to be haughty and intractable, when accidental or trifling occasions of dispute occur. Hence, frequent collisions, obstinate, envenomed, and bloody contests. The nation, prompted by ill-will and resentment, sometimes impels to war the government, contrary to the best calculations of policy. The government sometimes participates in the national propensity, and adopts through passion what reason would reject; at other times it makes the animosity of the nation subservient to projects of hostility instigated by pride, ambition, and other sinister and pernicious motives. The peace often, sometimes perhaps the liberty, of nations, has been the victim."

George Washington





Introduction to the recent drone debate...


Visit NBCNews.com for breaking newsworld news, and news about the economy

“I think what the president has seen is that our denial of the existence of the program – when it’s obviously happening – undermines peoples’ confidence overall in the decisions that their government makes,” Gibbs said.




A leaked government document details the legal argument supporting the president's use of drones to kill eventual Al Qaeda suspects. - See more at: http://www.thedailyshow.com/watch/wed-february-6-2013/skygall#sthash.yWexrb9u.dpuf
Obama's drone program's operational details (legal argument to kill Al Qaeda suspects, incl. US Citizens)... 





Obama administration hypocrisy concerning their drone program vs the earlier torture program?



As John Grisham did in one of his books where a black girl was having trouble getting justice until the lawyer made the Jury imagine her as white (the abuser got the death sentence). i.e. Imagine all the children listed dead below as white.

  • [ From: Imran Khan (official) exclusive interview with the Economist Magazine.]

    Imran Khan on Pakistan...



    At 4 minutes and 30 seconds Imran Khan points out that...

    "If people in Britain, for instance know exactly what these drones are doing I reckon they'll be bigger demonstrations here than in our own country. Because these are violations of all Humanitarian laws.

    On some information, which might or might not be correct, someone sitting thousands of miles away... presses a button and people are blown up! Houses are blown up in villages. They hit houses in the villages. People gather around and come to rescue the survivors minus limbs, another drone attack kills 7 people, killing the survivors, for another hour no one goes near the site, there are screams of the survivors... again people come to rescue them, ANOTHER drone attack and another 7 people are killed - 22 people are killed in this!

    I don't know who is the brain power behind this...

    Number 1: It is immoral

    Number 2: It is completely counterproductive. All it does is it creats Anti-Americanism which is now worse than ever in our history.

    You win the war on terror if you win the hearts and minds of the people"


    Interviewer Question: Do the drone attack lead you to be Anti-American

    Answer: I can't be Anti-American cause I realize that the majority of Americans would agree with me! Majority people in Britain are anti war. I'm anti THIS policy. Jimmy Carter critisized these drones attacks."

    Note: This isn't war. This IS terrorism by the Pentagon.

From Salon: The face of collateral damage Photos of missile debris help trace the path of a CIA drone missile that killed a young girl


The civilian massacre the US neither confirms nor denies

Please support our work - share this article
drone yemen composite
Three unnamed victims of the December 17 2009 strike (Photos courtesy Al Jazeera)



Family of Mohammed Nasser Awad Jaljala
Name
Age
Status
Mohammed Nasser Awad Jaljala
60
Father
Nousa Mohammed Saleh El-Souwa
30
Wife
Nasser Mohammed Nasser
6
Son
Arwa Mohammed Nasser
4
Daughter
Fatima Mohammed Nasser
2
Daughter
Family of Ali Mohammed Nasser Jaljala:
Name
Age
Status
Ali Mohammed Nasser
35
Father
Qubla Al-Kharibi Salem
25
Wife
Afrah Ali Mohammed Nasser
9
Daughter
Zayda Ali Mohammed Nasser
7
Daughter
Hoda Ali Mohammed Nasser
5
Daughter
Sheikha Ali Mohammed Nasser
4
Daughter
Family of Ahmed Mohammed Nasser Jaljala:
Name
Age
Status
Ahmed Mohammed Nasser Jaljala
30
Father
Qubla Salem Nasser
21
Wife
Mouhsena Ahmed Adiyou
50
Mother

The dead from the Anbour clan:
Family of Abdullah Mokbel Salem Louqye
Name
Age
Status
Abdullah Mokbel Salem Louqye
37
Father
Saleha Ali Ahmed Mansour
30
Wife
Ibrahim Abdullah Mokbel Salem Louqye
13
Son
Asmaa Abdullah Mokbel Salem Louqye
9
Daughter
Salma Abdullah Mokbel Salem Louqye
4
Daughter
Fatima Abdullah Mokbel Salem Louqye
3
Daughter
Family of Ali Mokbel Salem Louqye
Name
Age
Status
Ali Mokbel Salem Louqye
36
Father
Hanaa Abdallah Monser
28
Wife
Moheile Mohammed Saeed Yaslem
30
Safaa Ali Mokbel Salem
25
Daughter
Khadije Ali Mokbel Louqye
1
Daughter
Hanaa Ali Mokbel Louqye
6
Daughter
Mohammed Ali Mokbel Salem Louqye
4
Son
Family of Mokbel Salem Louqye:
Name
Age
Status
Fatima Yaslem Al-Rawami
67
First Wife
Maryam Awad Nasser
43
Second Wife
Jawass Mokbel Salem Louqye
15
Daughter
Family of Abdullah Awad Sheikh:
Name
Age
Status
Abdullah Awad Sheikh
65
Father
Family of Hussein Abdullah Awad Sheikh:
Name
Age
Status
Hanane Mohammed Jadib
25
Wife
Maryam Hussein Abdullah Awad
2,9
Daughter
Shafiq Hussein Abdullah Awad
1,5
Daughter
Family of Nasser Mahdi Ahmad Bouh:
Name
Age
Status
Maryam Mokbel Salem Louqye
38
Wife
Sheikha Nasser Mahdi Ahmad Bouh
3
Daughter
Family of Mohammed Saleh Mohammed Ali Al-Anbouri:
Name
Age
Status
Amina Abdullah Awad Sheikh
27
Wife
Maha Mohammed Saleh Mohammed
12
Son
Soumaya Mohammed Saleh Mohammed
9
Son
Shafika Mohammed Saleh Mohammed
4
Son
Shafiq Mohammed Saleh Mohammed
2
Son



“Oklahoma City”: The Bubba jobTwo seasoned journalists explore the disturbing, unanswered questions about the Oklahoma City bombing of 1995

More Bubba's...
US: Militia members plotted to kill federal officials, prosecutors say

1 in 7 strikes by the US leads to a child's death:

http://www.thebureauinvestigates.com/2011/08/11/more-than-160-children-killed-in-us-strikes/ 


Sundance award winner:

The documentary "Dirty Wars: The World is a Battlefield" follows investigative journalist Jeremy Scahill to Afghanistan, Somalia and Yemen as he chases down the hidden truth behind America’s expanding covert wars, focusing on the Obama administration’s increasing use of armed drones and secretive units including the Joint Special Operations Command. On Saturday, the film’s director, Richard Rowley, was awarded the Sundance Film Festival prize for best cinematography in a U.S. documentary, honored for "elevating the art of observational cinema through sophisticated lensing and an electric-color palette." Accepting the award, Rowley said: "Almost three years ago, when Jeremy and I knocked on a door in Gardez in rural Afghanistan, we were the first Americans that a family there had seen since Americans kicked their door in and killed half their family. And they invited us in, and they shared the most difficult story of their lifetime with us, because we promised them we’d do everything we could to make their story heard in America." 

George Carlin on American Foreign Policy - Bombing Brown People...

‎"And I'm not a really good American because I like to form my own opinions. I don't just roll over when I'm told to. Sad to say most Americans just roll over on command. Not me, not me. I have certain rules I live by, my first rule... I don't believe anything the government tells me" George Carlin http://youtu.be/dDw-zFFhFgc


7 Videos & 1 Image that Illustrates Capitalism & the GOP

The GOP claims to be true capitalists. This is a quick illustration of what Capitalists are according to the GOP...


Watch the first minute of the following video and you'll notice that Eric Cantor was only willing to help tornado victims in Missouri once spending cuts are made (i.e. caring about the people is not on his agenda unless it fits some old guys understanding of economics - for those who don't know, a countries economy doesn't work the same as your own personal budget)...

"Actual elephants are more useful than the GOP." Jon Stewart


Do you want to know about how "useful" the GOP are?

The speaker of the house voted for spending that led to the current debt...


[Note: He left out the unfunded Bush wars + the huge reduction in taxes for the rich which is the single largest contributor towards the debt i.e. if you don't remove the causes of a problem the problem will persist.]

Note that the GOP won the House i.e. through a type of fraud...




CHART from Mother Jones: Americans didn’t intend to elect a Republican majority to the House of Representatives. But thanks to GOP-engineered redistricting, they did. 

Related: Tools To Understand Democracy & Despotism from Encyclopedia Britannica.

NOTE: (Recent development) Obama won a whopping Electoral College victory. Now Republicans want to change how electoral votes are awarded: http://mojo.ly/TYpCYr


Why does the GOP hate everyone?

"Scorn in the U.S.A.: It must be tough for Republicans to love America so much but hate almost three-quarters of the people living in it."(at approx 8 mins into following video)


Notice at 5 mins that the sign in the back of Eric Cantor is "Heritage Foundation" which was started by the Koch Brothers, posted about here and here. Basically, the Koch Brothers tried to start a violent revolution which backfired when OWS showed up as it was on the wrong side. So they began clean-up. At least, that's one way of looking at it.[ For example: From John Stossel of Fox News (a Koch Brother Libertarian?) = "I think it will take visible riots to help people focus on this thing" (an indirect call for violence?) ]



BTW, anyone who wants to take 2% more tax from people who own corporations that are making billions and getting subsidies are called socialists (doesn't matter if they are paying less taxes than everyone else - or no taxes as the case may be)...

As Stewart illustrates...


Notes:
A. "We gotta start somewhere... that's a million dollars (that we could save) - in contrast to the 700 billion we could save to reduce the deficit from the rich and unfairly untaxed (i.e. there is class warfare but its from the ones who are trying to aggravate people by projecting what they are doing onto Buffet).
B . From fox news: Dont tax the rich but 'broaden the tax base' - ignore/cover over the realty of the tax codes (see these are not real republicans! more proof later). C. Taxing the majority (poor) instead of taxing the minority (super rich by comparison) this is the very definition of despotism.
D. Heritage institute (Koch Brother funded) are trying to create the image of poor being wealthy cause they have normal second world amenities. (i.e. this will lower standard of living).
E. Demonizing (irresponsible animals) the part of society that is suffering from the excess and scamming of certain individuals on wall street etc.

Even Dick Cheney joins in...

Cheney returns to mock Obama (given his record that's just ridiculous)...



This is what a true "capitalist" leader is supposed to be like to the GOP, apparently: 

Cheney literally said Iraq would be a quagmire before invading it...
Still Cheney After All These Years


Still Cheney After All These Years

Cheney's Secret Assassination Squad
It's hard to believe Dick Cheney had the time to command a secret lawless assassination squad with all the secret lawless torture. (02:10)



More about Dick Cheney's capitalist accomplishments here.

Related: 
GOP/Tea-Party Nonsense In A Nutshell: Outsiders ar...
Examples Of How The "Right" Reframes Lies Into "Tr...
Summary of "Socialism", Keynesian Economics & "Road to Serfdom" (by F.A.Hayek)

Feb 25, 2013

5 Videos Proving Mitt Romney Is A Vulture Capitalist


Romney: "I'm not a vulture capitalist" (i.e. 'My Republican primary opponents are lying about me'. Mitt)





Mitt claims NOT to be a VULTURE capitalist. Lets look at the evidence...

Mitt Romney touts his experience at Bain Capital as a strength, but not the experience with leveraged buyouts.


Notice at approx 2 min 50 sec into above video = Bain capital made a huge profit AND steered the company into bankruptcy... if you destroy a company to make money how can you trust that person with the economy of a country? I'm sure destroying the US economy (or even the global economy) will be profitable to some people.... do you really want to hand the reins of the presidency to a person who comes from the greed and lack of compassion side of capitalism? - They(Bain Capital) don't even have to use thier own money to destroy a company AND make money off of that! (see documented evidence below)

 Mitt Romney uses an age-old ruse to explain how his time at Bain Capital wasn't a conflict of interest, and selectively releases his tax returns as required by law...


Notice At 50 seconds: A young Mitt Romney (from many years before he decided to run for the Presidency, obviously)... tells his blind trust what it can OR cannot do.


While CEO of Bain Capital, Mitt Romney bought and resold a telephone directory company for 25 times as much, earning the enmity of Italian shareholders...



Sounds & looks like vulture capitalism to me. 

Notice how Romney is described about 2 minutes and 30 seconds into this video...

As Stephen Colbert explains...

'he chops up companies' ... does that remind you of any movie? ...

"Edward is a rich, ruthless businessman who specializes in taking over companies and then selling them off piece by piece."

i.e. even the Hollywood references prove that Mitt is a vulture capitalist!


4 Videos & 4 Images That Define Mitt Romney's Presidential Run



4 Videos & 4 Images That Define Mitt Romney's Presidential Run


The Romney campaign asks Rick Scott to downplay Florida's job gains since they only help Obama...



"Bad economic news is great news for Mitt Romney, so conservatives must drag everyone down in the dumps to get America back on track."

 i.e. Romney's test of truth telling = "If it ain't broke, insist that it is..."

Note: This one of of Mitt Romney's friends in the GOP...

Peter King supported the IRA's bombing of civilians (white people in England)... now he's in charge of Homeland Security... "Colbert Report: Peter King's links to terrorism"

Peter King: force behind Muslim hearings was an IRA supporter
Republican senator dismisses critics' attempts to draw a parallel with al-Qaida, arguing the IRA never attacked on US soil




Mystery Finance Theater 2012: Mitt Romney refuses to release his tax returns, citing the Obama administration's desire to hound him with frivolous transparency demands...

Notice how Republicans are giving Mitt Romney the option of only releasing 6-10 years of taxes... yet Mitt Romney has been in political office since the 1990's. It's sad that Sean Hannity wants to see Obama's college transcripts, which was probably from 30 years ago, but won't ask Romney basic questions that should have been covered earlier in this primary. Mitt Romney won't release his taxes from the beginning of his political career! ... even though we know Congress has been making laws to help them make money through Delaware - Has Mitt Romney used his political influence to make money through robbing someone legally? There is only one way to find out, i.e. complete transparency of financial records.


***********
Mitt Romney refuses to release his taxes, his record at Bain Capital, his record of Job Creation, Job Creation under him at Bain Capital, (i.e. anything about him).





Mitt says he will be a better "job creator" because of his business experience but he can't prove he actually created ANY jobs while being at Bain!

BUT Mitt Romney can't even prove the measly 100,000 "net jobs" he claims to have added over the years...



"Mitt Romney says he created 100,000 jobs while at Bain Capital. Anderson Cooper is Keeping Them Honest."


Romney's Account of His Departure From Bain Undercut by...Romney Testimony
In a previously unreported remark, Romney indicated he went through a "transition" at Bain after heading to Utah in February 1999.

Mitt Romney's campaign is still wrestling with when he left Bain Capital. Over the weekend, they tried saying he "actually retired retroactively."

And these documents challenge Romney's claim that he left Bain Capital in early 1999.

Earlier this year, Mitt Romney nearly landed in a politically perilous controversy when the Huffington Post reported that in 1999 the GOP presidential candidate had been part of an investment group that invested $75 million in Stericycle, a medical-waste disposal firm that has been attacked by anti-abortion groups for disposing aborted fetuses collected from family planning clinics. Coming during the heat of the GOP primaries, as Romney tried to sell South Carolina Republicans on his pro-life bona fides, the revelation had the potential to damage the candidate's reputation among values voters already suspicious of his shifting position on abortion.

 Romney: Bain a “small company”

The GOP candidate says he started a "small company" ... with $37 million

AMPA – Everybody loves small-business owners and tonight Mitt Romney will pretend to be one. “When I was 37, I helped start a small company,” his speech reads, according to excerpts released early. ”That business we started with 10 people has now grown into a great American success story. Some of the companies we helped start are names you know,” he adds. The section comes just after Romney extolls the virtue and industrious of the small-business entrepreneurs.

Of course, the “small company” he refers to is Bain Capital. Bain was started with $37 million in initial capital, much of it raised from wealthy foreign donors. The company was spun off of Bain & Co., an unquestionable giant in the massive international consulting industry. The company quickly invested millions in other companies and grew rapidly, and has $66 billion under management, as of January.

“Small” is obviously a relative term, but considering that the average start-up cost for small business is as low as $10,000, or  1/3,700 of what Romney started his company with, he may be taking some serious poetic licensee.



Is Mitt Romney Taking Bailouts & Hiding The Money?

NEWS REPORT: Mitt Romney has millions of dollars saved in offshore Cayman Islands tax shelters

  • Holds a reported $33 million in the Caribbean British territory's accounts
  • Offshore banking could be one reason Romney is withholding his tax returns
  • Newt Gingrich reported 31 percent tax on his income -- in line with the top tax bracket

Rachel Maddow On His EIGHT Companies In The Cayman Tax Shelters...

Visit NBCNews.com for breaking news, world news, and news about the economy

NOTES:

1. Proof of Mitt Romney TAKING a bailout from The Rolling Stone...

See the FDIC documents detailing Mitt Romney's federal bailout: http://bitly.com/Rmui8g 



2. PROOF THAT MITT ROMNEY HAS CONNECTIONS TO THE PEOPLE WHO LENT OUT TRILLIONS OF DOLLARS (IS THIS PART OF THE REASON WHY HE'S HIDING HIS TAXES SO DESPERATELY?)...

VIDEO: In 2002 Mitt Romney touted D.C. connections, ability to get millions of taxpayer dollars from federal gov’t
Back in March, ABC reported the following, but it’s likely that fewer people were paying attention, so, it’s time to revive the story:
In a long-forgotten tape from the 2002 Massachusetts governor’s race obtained by ABC News, Mitt Romney is seen touting his Washington connections and his ability to get millions of taxpayer dollars from the federal government.
“I am big believer in getting money where the money is,” Romney says on the video, “The money is in Washington.”
Gasp! What a commie socialist!
Just one more example of his blatant hypocrisy.

Alternate Video Site - FROM ABC:
In a long-forgotten tape from the 2002 Massachusetts governor’s race obtained by ABC News, Mitt Romney is seen touting his Washington connections and his ability to get millions of taxpayer dollars from the federal government.
“I am big believer in getting money where the money is,” Romney says on the video, “The money is in Washington.”

Where did Romney get all his wealth? It can't be from honorable means if he refuses to show more than 2 and 1/2 years of taxes... especially when he was bragging about how much money he could get from Washington in 2002 (see above).





From Salon:
Mitt’s many mansions
Reporters need to start asking Romney about the crisis we face in our housing markets
Housing is a topic that Mitt should know something about. After all, his father, George, served as the nation’s housing secretary during the Nixon administration. And Mitt currently owns three homes, according to Zillow.
  • In 1989, Romney bought a seven-bedroom, 6.5-bath home in upscale Belmont, a Boston suburb. The 6,434 square foot house is situated on 2.44 acres. With his kids grown, Romney sold the house in 2009 for $3.5 million — 293 percent more than the purchase price of $890,000 twenty years earlier. (This is the kind of job-creating entrepreneurship that — along with inheriting his father’s fortune — made Romney a rich man). The following year Romney — the former Massachusetts governor who needed a local address in order to run for president — bought a two-bedroom, 2,100 square foot townhouse in Belmont for $895,000.
  • Romney’s weekend vacation estate, which sits on Lake Winnipesaukee in Wolfeboro, N.H., includes a three-story, six-bedroom, 5,400 square foot main house, plus an additional guest house, that are worth an estimated $10 million.

4 videos (All Below 7 Minutes) That Explain Credit Ratings Downgrades (i.e. probably paid for by someone)


Background:

The Financial Crisis Explained In 3 Videos (Only one is over 7 minutes) 

Washington D.C., TARP & Homeowners Nonsense Explained In 3 Videos & 1 Image 

4 Videos Under 7 Minutes Illustrating Congress In Full 



The big three credit rating agencies are said to...

The decisions of the "Big Three" catalyze market moves in often unpredictable ways, creating a strong ripple effect.


Yet these credit rating agencies have investors all over the world looking to them for years (and decades) for credit rating information...

Investors across the world look to credit rating agencies to judge where to place their bets in the market. For governments, the ratings agencies have a lot of power over the popularity of bonds: cash given to governments by investors that, over time, will pay a return on the original investment -- unless the government defaults. The downgrade of Ireland this week signaled Moody's belief that Ireland has a higher likelihood to default on investments. And global investors have little appetite to invest in those bonds.


Credit ratings agencies gave AAA ratings to bad assets were at the heart of the 2008 financial crisis...

At 2 mins - "These are the guys who gave AAA ratings to mortgages that were toxic" (about Standard and Poor)...



In the financial world... the fox is always guarding the chicken coop...


Notes: The big 3 - S&P, Moody's and Finch - are the main cause of the 2008 financial meltdown. - 2. They get paid by private companies for private ratings! clear contradiction of interest, especially when a private company is exerting influence on any economy (much less a global economy).

Having a business monitor it's own dealings is like having a feudal lord monitoring his own peasant farmers. Or as Senator Bernie Sanders calls it, "The Fox Guarding The Henhouse



When private ratings led to the financial crisis and we know some people, including congress profited from it then why don't we just ask them to give the money they took... back to the investors they took it from?


The New York Times Washington bureau chief discusses S&P's defense, private bank suits and the AIG bailout...    



An ex-credit agency guy says:

Harrington, who worked at Moody's for 11 years until he resigned last year, said ratings agencies suffer from a conflict of interest because they are paid by the banks and companies they are supposed to rate objectively.



Financial Crisis 2008 In A Nutshell...



Best part is that the 700 billion, no questions asked, TARP bailout was just the tip of the iceberg as the Federal Reserve (again playing God with the US economy) gave out an additional 16 trillion to their close buddies. Notice that the Federal Reserve is a private bank and thus has no oversight. They can do whatever they want to the economy and NEVER have to face elections for this actions, i.e. no consequences! If you have access to a money printing machine and couldn't get in trouble no matter what you did, would you print yourself up some cash? If you could give this money away with no consequences would you give some to your friends? It's just paper, after all.


Credit rating agencies have way too much power given their lack of credibility to any reasonable person (i.e. they sold AAA rating status)

Proof 1:

But beyond the rights and wrongs of this row lie deeper questions of how much trust should be placed in credit rating agencies and whether the influence they have over sovereign debt markets needs to be curbed. Politicians are right to fear the agencies' red pens. A downgrade sends up the cost of borrowing and can plunge nations deeper into a spiral of indebtedness. The Greek debt crisis laid bare the immense, and some would say unwarranted, power that they wield. Unsurprisingly, the big three – S&P, Moody's and Fitch – have come under fire, with Germany and France calling for their wings to be clipped.

Credit agencies operate in the obscure backwaters of the financial system, but played a major role in the meltdown.



Proof 2

Moody's, Standard & Poor's and Fitch, the world's biggest agencies, have been criticised by the EU and by high-deficit countries for exacerbating the crisis, as a downgrade fuels investors' fears about the ability of any debtor to repay its loans. The discussion started when Greece was downgraded at the height of the market turbulence this year that ultimately pushed the country into a bailout programme.

Ireland's cut, which puts it on the same level as Russia and Lithuania, pushes up its borrowing costs – a burden that a country already in the midst of draconian budget cuts can ill-afford.


Proof 3

The ratings agencies received widespread criticism for their role in the financial crisis after giving AAA ratings to investments made up of sub-prime home loans that subsequently imploded. S&P attracted more heat in August when it downgraded the US's debt. A move that US treasury secretary Tim Geithner said showed "terrible judgement".

The SEC is weighing action over a particular CDO known as Delphinus CDO 2007-1, which was singled out as a "striking example" of what went wrong in the credit crisis by the Senate committee report Wall Street and the Financial Crisis, published in April.

The $1.6bn (£1bn) CDO was downgraded a few months after AAA ratings were issued by both S&P and rival Moody's. The ratings agencies awarded tranches of the investment their top grade in July and August of 2007 but had begun downgrading them by the end of the year, "and by the end of 2008, had fully downgraded its AAA-rated securities to junk status," according to the report.


German government had to actually seek assurances that the credit agencies wouldn't interfere with the tough economic problem the Europeans have:

"German government sources said they had received assurances from the international ratings agencies that they would not rush to judgment in declaring a Greek default but would take their time in studying whatever finally emerged and for it to impact on Greece's private creditors." .


And eventually getting the rating agencies away from meddling in economies has been written into a new plan...

"14 Reduce reliance on non-European credit rating agencies"




Context: America's Next TARP Model

A Bloomberg report reveals that the U.S. government loaned banks $7.7 trillion in secret bailout funds at no interest and then borrowed the money back at interest.
http://www.thedailyshow.com/watch/thu-december-1-2011/america-s-next-tarp-model?xrs=synd_facebook

'Basically the banks were being lent money at no interest (by the government) and then the government was borrowing it back and giving interest!' What a sweet deal!... Why is the US so low on the corruption charts? Who makes these charts? [A Bloomberg report [ http://www.bloomberg.com/news/2011-11-28/secret-fed-loans-undisclosed-to-congress-gave-banks-13-billion-in-income.html]reveals that the U.S. government loaned banks $7.7 trillion in secret bailout funds at no interest and then borrowed the money back at interest!!!!