Wall Street's Four Basic Cons

Discussion in 'Economy' started by georgephillip, May 27, 2011.

  1. georgephillip
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    georgephillip Gold Member Supporting Member

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    1. Counterfeitng financial bubbles and loan pyramids to create "facsimiles of official money for private gain unrelated to anything of real value." (Phantom wealth)

    2. A Ponzi scheme involving selling shares in asset bubbles "that are maintained solely by the constant inflow of new money." (Securities fraud)

    3. Wall Street collects premiums to cover risks the insurer lacks adequate reserves to cover and then refuses to pay legitimate claims. (Reverse insurance fraud)

    4. Using fraud, extortion, usury and deceptive promises to "lure the desperate into perpetual debt at exorbitant interest rates." (Predatory lending)

    Because Republicans AND Democrats depend on the same 1% of voters to fund their campaigns, all these crimes may well be perfectly legal. And you probably shouldn't expect your corporate press (conservative or liberal) to provide any context:

    "Ever hear a business reporter on the evening business news say, 'Today, investors drive up the price of commodities to create a hundred billion in new value,' or some such?

    "Sounds great, almost implying we should offer thanks to these champions of the public good who are risking their fortunes to expand the pool of wealth to enrich us all.

    "The reporter is manipulating the language to set us up as marks in the Wall Street con.

    "A more honest report might have said, 'Today, hedge fund traders speculating with other people’s money walked away with multimillion dollar commissions for inflating the commodities bubble by a hundred billion dollars.”

    "In a more honest world, the report would clearly distinguish between real investors creating real wealth through real investments and speculators creating phantom wealth with financial games.

    "People who bet on the price of pieces of paper would be called 'gamblers.'

    "Those who hold the bets and distribute the winnings would be called 'bookies.'”

    Jail the Wall Street criminals and keep the casinos in Vegas.

    7 Ways to Stop Wall Street's Con Game | Common Dreams
     
    • Thank You! Thank You! x 1
  2. midcan5
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    midcan5 liberal / progressive

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    Big money controls America today but what is amazing about wall street is, even failure pays! There is a bit of hope though, Ryan's plan to kill grandma and reward big money has finally shown republicans to be who they are and what they stand for. I do like his honesty in this plan, but was he so naive that he thought it would go unnoticed? Republican flip flopping is now so complex you need a scorecard to keep track.

    http://www.usmessageboard.com/economy/138954-five-zombie-economic-ideas-that-refuse-to-die.html


    "Not only does there seem to be widespread social fragmentation and disillusionment with democracy in the United States, but the possibility of reversing this sense of alienation appears to many of us to be already lost. Any democratic president who wants to institute the desperately needed reforms in health, welfare and the environment faces one of two options. He can stick by his reform program and suffer a loss of public confidence through orchestrated campaigns to publicly portray him as 'too liberal' and ineffectual (the Carter image) or too indecisive or sexually indiscreet (the Clinton image). Alternatively, a reforming democratic president can move further to the Right, forget his promises and become part of the propaganda campaign. Given the history of democratic propaganda in the United States, some of us doubt that another Roosevelt or New Deal is possible. The political system is now so attuned to business interests that this kind of reformer could no longer institute the substantial health, welfare, education, environmental and employment reforms the country needs." Andrew Lohrey, Introduction, Alex Carey "Taking the Risk Out of Democracy"
     
  3. georgephillip
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    georgephillip Gold Member Supporting Member

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    David Korten lists seven ways to stop the con:

    " Prohibit selling, insuring, or borrowing against an asset not actually owned by the seller, and issuing any security not backed by a real asset—all common Wall Street practices.
    Place strict limits on how much a financial institution can borrow in order to buy a property, and establish conservative reserve and capital requirements for institutions in the business of selling insurance of any kind.
    Regulate bond-rating agencies and impose strict penalties for fraudulent ratings.
    Impose a small financial-speculation tax of a penny on every $4 spent on the purchase and sale of financial instruments such as stocks, bonds, foreign currencies, and derivatives. This would have no consequential impact on real investors making long-term investments in real businesses and assets. But it would discourage short-term speculation and arbitraging.
    End the obscure tax loophole that allows hedge fund managers to report their billion-dollar compensation packages as capital gains, taxed at only 15 percent.
    Assess a 100 percent capital gains surcharge on profit from the sale of assets held less than an hour, 80 percent if held less than a week, and perhaps falling to 50 percent on assets held more than a week but less than six months. This would render most forms of speculation unprofitable, stabilize financial markets, and lengthen the investment horizon without penalizing real investors.
    Eliminate debt slavery by raising the wages of working people and the taxes of the moneylenders.

    I've bolded my favorite.

    Jubilee, anyone?

    7 Ways to Stop Wall Street's Con Game | Common Dreams
     
  4. editec
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    editec Mr. Forgot-it-All

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    Almost without exception in THIS meltdown, the key element leading to bubbles was that the players were LYING to their customers, and often to their STOCKHOLDERS, too.

    This nation has created moral hazards in the banking and finace and stock business that serve the interests of very smart people people without the ethiccal sense of a polecat.

    And worse, many of those people end up in GOVERNMENT, too.
     
  5. georgephillip
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    georgephillip Gold Member Supporting Member

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    "Social Credit is an economic philosophy developed by C. H. Douglas (1879–1952), a British engineer, who wrote a book by that name in 1924. Social Credit is described by Douglas[1] as 'the policy of a philosophy'; he called his philosophy 'practical Christianity'. This philosophy is interdisciplinary in nature, encompassing the fields of economics, political science, history, accounting and physics.

    "Assuming the only safe place for power is in many hands, Social Credit is a distributive philosophy, and its policy is to disperse power to individuals. Social Credit philosophy is best summed by Douglas when he said, 'Systems were made for men, and not men for systems, and the interest of man which is self-development, is above all systems, whether theological, political or economic.'"

    When Douglas made a world tour in the 1930s he was allowed to visit the US; however, he wasn't allowed to publicize his theory.

    What is it about real competition the Capitalists, Communists, and Socialists are afraid of?

    Social Credit - Wikipedia, the free encyclopedia
     
  6. editec
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    editec Mr. Forgot-it-All

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    What astounds me is the numbers of people who worry about government centralized power (which a threat without doubt) but who do not worry about ECONOMIC centralized power.

    Same problem in both cases, as anybody who is looking realistically at our current state of affiars can plainly see.
     
  7. georgephillip
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    georgephillip Gold Member Supporting Member

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    Wouldn't you think those who view central planning with suspicion would look at corporations more critically than they do?

    Chomsky connects the dots between the savagery and violence necessary to create the modern European nation state with contemporary corporate capitalism, "mostly imposed by judicial arrangements, not by legislation, and very tightly integrated and linked to the powerful states..."

    "It's impossible to distinguish the modern dominant states from the multinational corporate system, the conglomerates that rely on them, that have a relation of both dependency and domination to them."

    "In fact, two centuries ago, James Madison in a very early period of modern capitalism described the relation of business to government as that of 'tools and tyrants.'

    "He said that businesses are the 'tools and tyrants' of government.

    "By now (2005) that's become virtually the definition of the world.

    "Multinational corporations are the tools and the tyrants of the powerful states, so making a distinction between them is extremely hard."

    State and Corp., Noam Chomsky interviewed by uncredited interviewer
     

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