Oakland City Hall Under Siege by #OccupyOakland
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Read more...Category Archives: The destruction of the middle class
Michael Hudson: Banks Weren’t Meant to Be Like This
By Michael Hudson, a research professor of Economics at University of Missouri, Kansas City and a research associate at the Levy Economics Institute of Bard College
A shorter version of this article in German will run in the Frankfurter Algemeine Zeitung on January 28. 2012
The inherently symbiotic relationship between banks and governments recently has been reversed. In medieval times, wealthy bankers lent to kings and princes as their major customers. But now it is the banks that are needy, relying on governments for funding – capped by the post-2008 bailouts to save them from going bankrupt from their bad private-sector loans and gambles.
Yet the banks now browbeat governments – not by having ready cash but by threatening to go bust and drag the economy down with them if they are not given control of public tax policy, spending and planning. The process has gone furthest in the United States.
Read more...Will the Mitt/Newt Slugfest Boost the Occupy Movement?
By Lynn Parramore. Cross posted from Alternet.
Representing the twin evils of ruthless capitalism and government corruption, the GOP candidates are bringing core Occupy issues to the fore.
Read more...David Stockman Disses Private Equity Business Acumen on Dylan Ratigan Show
By dint of news flow, we are having a private equity fest tonight. David Stockman, the former Reagan budget director, made a cogent case against the idea that being at the helm of a private equity firm has much to do with knowing how to run a business on Dylan Ratigan. I thought readers would enjoy this segment, not simply due to the content but also because Stockman is a compelling and blunt speaker.
Read more...Quelle Surprise! It’s Better to Run a Private Equity Fund than Invest in One
It’s perverse that it takes a Mitt Romney presidential bid to shed some long-overdue harsh light on the private equity industry.
It was not as hard as you might think to do well in the private equity business in the 1990s. Rising equity markets lift all boats, and PE is levered equity. A better test of the ability to deliver value is how they did in more difficult times.
The Financial Times reports on a wee study it commissioned to look into who reaped the fruits of private equity performance. Its findings:
Read more...New York Times Tells Us Only Chinese Near Slave Labor Could Handle Steve Jobs’ Demands
A New York Times story, “How U.S. Lost Out on iPhone Work,” uses an Obama dinner with Silicon Valley titans to frame its tale of why the US middle class should roll over and die. I am of course exaggerating for effect. But not by as much as you might think. The story by Charles Duhigg and Keith Bradsher does a very good job of explaining why Asia, and China in particular, has come to dominate consumer electronics manufacture, using the iPhone as focus.
The problem with using the microcosm to illustrate the macrocosm is you need to choose the right microcosm.
Read more...Spain’s “Indignados” and the Globalization of Dissent
Real News Network highlighted a foreign broadcast on Spain’s “indignados,” and the way they have been providing advice to other anti-neoliberal movements around the world. I’m not sure it has gotten the attention it warrants, but the people that were involved in Occupy Wall Street early on conferred a good deal with seasoned protestors in Spain and Egypt.
Read more...Zombie Europe
By Delusional Economics, who is horrified at the state of economic commentary in Australia and is determined to cleanse the daily flow of vested interests propaganda to produce a balanced counterpoint. Cross posted from MacroBusiness.
One of the major themes that I have been discussing in Europe for a long period of time is the simple failure of logic in which the European periphery is being instructed to push deflationary policy onto their economies, yet at the same time expected to meet their existing, and growing, debt obligations. In the most extreme case this has led to what you now see in Greece, but I don’t think Portugal or Spain are far behind. This failing policy is leading to the ‘zombification’ of nations, in which they can’t grow out off their debts yet aren’t being allowed to fail on them either. Kept alive by an ever-growing lifeline of foreign aid when the real solution is to let the beast die and re-build from the ashes. I think if we compare Iceland to Ireland we are beginning to get a clear picture of the benefits of writing off the debts and starting anew.
As I have also spoken about over the last month or so, what is happening in the real economies of Europe is being replicated in the banking system.
Read more...Obama to Try Better Smoke and Mirrors to Address Housing Market Woes
If I had Onion-level parody skills, I’d treat the latest story in The Hill on Team Obama’s latest housing headfake masquerading as an initiative by riffing on one of its planned new program. Call it HUMP, Homeowners Upward Mobility Program. In true Ministry of Truth style, mortgage borrowers facing foreclosure would be moved, discreetly, into tent cities that would do Potemkin proud, with names like “Country Club Lane” and “Lake Shore Drive” and painted facades in front of their tents and shanties. Local merchants would praise the new subdivision and the inhabitants would say how nice it was to now be living in a McMansion, even if it was only really a couple of inches deep.
But instead you get my normal shtick.
Read more...Greece Poised to Default
By Delusional Economics, who is horrified at the state of economic commentary in Australia and is determined to cleanse the daily flow of vested interests propaganda to produce a balanced counterpoint. Cross posted from MacroBusiness.
Another melee won by the ECB overnight with the LTRO once again pushing sub 3 year sovereign auctions into a “happy place”.
Read more...Bloomberg News Joins the “Inside Job” Team, Objects to Economics’ Inadequate Conflict of Interest Standards
It’s surprising and refreshing to see Bloomberg News, via an editorial, take on the way the economics profession has failed to clean up its act not simply in the wake of a massive intellectual failure but after the movie Inside Job highlighted some examples of corruption in the ranks of Famous Economists.
Read more...Martin Luther King v. Mitt Romney
A revealing juxtaposition, and a belated MLK Day item:
Read more...Ron Paul Debate Flushes Out Gender-Baiting Right Wing Opportunists Masquerading as Progressives
The intense debate precipitated by a post on this site, “How Ron Paul Challenges Liberals,” and follow up posts by Glenn Greenwald and here serve to prove their simple yet frequently misrepresented thesis: that Ron Paul’s anti-war, anti-Fed positions expose fault lines among those traveling under the “liberal” banner.
Anyone who read comments on NC prior to this debate would have noticed some sympathy for Paul, ranging from the more common “he’s batshit and I’d never vote for him, but his opposition to our Middle East adventurism and the lack of accountability at the Fed is refreshing” to some making a stronger case for him. That shouldn’t be surprising given the point often made here and in the few lonely “progressive” outposts on the blogosphere (“progressive” is in the process of being co-opted in the same way “liberal” has been): that the Democratic party has been so deeply penetrated by the neoliberal/Robert Rubin/Hamilton Project types that it isn’t that different from the right on economic issues.
It should not be controversial to point out that the Democratic party uses identity politics as a cover for its policy of selling out the middle class to banks and big corporate interests, just on a slower and stealthier basis than the right. And we’ve seen the identity card used in a remarkably dishonest manner in this Ron Paul contretemps.
Read more...Adam Davidson, the 1%’s Lord Haw-Haw, Fellates Wall Street
Although I endeavor to treat high dudgeon as an art form, it is difficult to find words adequate to convey the level of ridicule and opprobrium that Adam Davidson’s latest New York Times piece, “What Does Wall Street Do for You?” deserves. I had the vast misfortune to come across it late last week, and have gotten an unusually large volume of incredulous reader e-mails about it. Ms. G’s e-mail headline “NYT – Not a Parody” was typical:
Read more...This one is so bad, even for NYT, I’m wondering if the paper wasn’t secretly sold to Murdoch, Bloomberg & the Fed Reserve sometime in the past few days.
Philip Pilkington: Fear and Loathing in the Financial Markets – What Happens to the Economy When the Oil Bubble Bursts?
By Philip Pilkington, a journalist and writer living in Dublin, Ireland
In 2008 profits in the US economy crashed out. But they soon bounced back. This bounce was largely due to the profits being reaped in the financial sector – which sickened many given that 2008 was in large measure caused by the financial sector. This always struck me as odd – not to mention unsustainable. If the ‘real’ economy is in the doldrums you can be sure that, in the medium to long run, the business class will go down with it.
In what follows I will draw on Chris Cook’s post on this site the other day to argue that, if he is correct (and I think he may be), judgment day is just around the corner for the profiteers.
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