WORLD without BANKS

Posted on August 12, 2014 by | 37 comments

By J.D. Alt

Sometimes it helps, if you want to see and understand something more clearly, to imagine the world without it. I just finished a book (“Rethinking Money” by Benard Lietaer and Jacqui Dunne) that was so thoroughly confused—and confusing—about how the U.S. private banking system “creates our money” (but perversely refuses to create enough of it) that I felt an overwhelming need to try to clarify, in my own mind, what the private banking system actually is. That’s when I got the idea of imagining a world without private banks at all—and trying to see at what point, and for what purpose, they become useful or, perhaps, even necessary.

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A New Demand for the US Climate Movement: One Million (Frequent) Electric Buses with Wifi plus Protected Bikeways, “Everywhere”

Posted on August 11, 2014 by | 8 comments

By Michael Hoexter

The US climate movement, in which I am active, has not to date been effective enough in getting serious climate action on the agenda of government leaders, especially on the federal level. This weakness is in part shared with the international climate movement more generally, though the level of climate denial both among political elites and among the general population in the US is unmatched in the world. With that denial comes resistance to climate action, though for a variety of reasons, no actions commensurate to the climate challenge have really been attempted by governments in the world, whatever the local level of resistance offered.

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Why Money Matters

Posted on August 7, 2014 by | 25 comments

By L. Randall Wray*

Our Mission Oriented Finance conference explores how to direct funding toward what Hyman Minsky called “the capital development of the economy”, broadly defined to include private investment, public infrastructure, and human development. (See more here.)

But to understand how, we need to understand what money is and why it matters. After all, finance is the process of getting money into the hands of those who will spend it.

The dominant narrative is that money “greases” the wheels of commerce. Sure, you could run the commercial machine without money, but it runs better with lubricant.

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UPDATE: Bank of America Fined Another $16 Billion for Fraud

Posted on August 7, 2014 by | 9 comments

By L. Randall Wray

Bank of America just agreed to pay another $16 Billion fine for one of its frauds—selling trashy securities to its investors. Another day, another fraud exposed. No surprises there. This is so routine it barely deserves a headline.

According to Bloomberg, that raises the total it has agreed to pay for its mortgage lending frauds to $70 billion. Most of this is related to its purchase of Countrywide, where Mairone oversaw much of the fraud. See here.

BofA rewarded Mairone for creating Countrywide’s “Hustle” fraud by hiring her. So far that woman’s criminal expertise contributed toward mounting costs to BofA of $70 billion. Quite an accomplishment!

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IT’S OFFICIAL: TOO BIG TO FAIL IS ALIVE AND WELL

Posted on August 6, 2014 by | 16 comments

By L. Randall Wray

Thank heaven for Tom Hoenig, the only proven-honest central banker we’ve got. Yes, I know he’s moved on from the KC Fed to serve as Vice Chairman of the FDIC. He actually might do a lot more good over there, anyway.

In recent months, we’ve heard how Wall Street’s Blood-sucking Vampire Squids have reformed themselves. They no longer pose any danger to our economy. They’ve written “living wills” that describe how they’ll safely bury themselves without Uncle Sam’s help next time they implode.

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Setting the Record Straight One More Time: BofA’s Rebecca Mairone Fined $1Million; BofA Must Pay $1.3Billion

Posted on August 2, 2014 by | 15 comments

By L. Randall Wray

Now here’s Déjà vu all over again. You might remember the name Rebecca Mairone from a few years ago. She’s back in the news:

“Rebecca Mairone, formerly a top official at Countrywide Financial, has been named in an amended complaint filed earlier this month by Preet Bharara, the U.S. Attorney for the Southern District of New York, against Countrywide and its parent Bank of America. The suit alleges that Mairone, as chief operating officer for Countrywide’s Full Spectrum Lending division in 2007, set up a program dubbed the “High Speed Swim Lane,” or “HSSL,” or “Hustle,” to speed up the origination of mortgage loans, including increasingly shady subprime loans. The government claims the alleged Hustle ultimately cost its sponsored entities Fannie Mae and Freddie Mac more than $1 billion in losses.

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What’s Wrong with “Congestion Pricing”? It’s Not Just the Creation of “Lexus Lanes”

Posted on August 1, 2014 by | 7 comments

By Robert E. Prasch

The past six months have seen an uptick in the number of “news” articles detailing the workings of what economists call “congestion pricing.” For those unfamiliar with the idea, these are schemes wherein people can elect to pay a premium to access a “fast lane” so as to avoid congestion in some public place, or for some public service, at times of peak demand. In keeping with the doxa of our times, the idea is that the creation of a market, where previously one did not exist, is ipso facto a “win” for all parties.

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DOJ Trains AUSAs to Chase Mice While Lions Roam the Campsite

Posted on July 21, 2014 by | 7 comments

By William K. Black

In researching my series of articles on the critical omissions in Attorney General Eric Holder’s press release about the settlement with Citi I realized that I need to write multiple articles about the destructive role played by Benjamin Wagner. Holder made Wagner DOJ’s leader on mortgage fraud because Wagner was so willing to propagate the single most absurd, destructive, but so very useful (to the administration and the banksters) lie about mortgage fraud.

“Benjamin Wagner, a U.S. Attorney who is actively prosecuting mortgage fraud cases in Sacramento, Calif., points out that banks lose money when a loan turns out to be fraudulent. ‘It doesn’t make any sense to me that they would be deliberately defrauding themselves,’ Wagner said.”

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CBO—Still Out of Paradigm after All These Years

Posted on July 20, 2014 by | 22 comments

By Scott Fullwiler

The Congressional Budget Office (CBO) published its long-term deficit and national debt projections last week.  These are the projections most widely cited in policy discussions about long-term “sustainability” of the national debt and entitlement programs.  In this post I focus on a small but very important part of the report—the CBO’s discussion of the “Consequences of a Large and Growing Debt,” which can be found on pages 13-15.  This section can be found in past reports going back several years, and hasn’t change much if it has changed at all during this time.  It is also consistent with the thinking of most economists on these issues.  As readers of this blog will recognize, the CBO’s analysis is “out of paradigm” in that it is inapplicable to a sovereign, currency-currency issuing government operating under flexible exchange rates such as the US, Japan, Canada, UK, Australia, etc.

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TRUSTEE BANKS SUED FOR $250 BILLION

Posted on July 19, 2014 by | 10 comments

By L. Randall Wray

Here’s another story in the continuing saga of Bankster fraud.

As I’ve argued since 2008, it is likely that all—or nearly all–of the residential mortgage backed securities (RMBSs) are fraudulent. The Banksters engaged in fraud at every link in the RMBS food chain.

They defrauded the borrowers. They forced the appraisers to commit fraud (pressured them to overvalue property). They conspired with ratings agencies to overvalue the RMBSs. They created MERS to destroy property records and to cheat local governments out of recording fees. They separated the promissory notes from the deed of trust, invalidating the lien. They hired BurgerKing Robo-signers to create forged documents. They lie in court, committing perjury. They steal homes from owners who don’t even have mortgages. And on, and on, and on. Their depravity knows no bounds.

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