Big Bank financial repression… ”You can’t do anything about it” – economist Paul Craig Roberts

Paul Craig Roberts: The Cancer Of Financial Repression (And Why You Can’t Do Anything About It)   Excerpts from ZeroHedge 02/22/2015

Dr. Paul Craig Roberts is extremely meticulous in examining the central problems facing America and the developed economies today. You may not like nor agree with what he says but there is little double as a former high level Treasury official, academic professor and Wall Street Journal editor, that he knows what he is talking about.
FINANCIAL REPRESSION
“It is going on on several fronts conducted by different people for their own agendas, though they all seem to be mutually supporting.
1. FINANCIALIZATION OF THE ECONOMY by the Big Banks. – “What that means is that they are converting the entirety of the economic surplus to paying interest on debt. They are draining the economy of all vitality! There is nothing left for the expansion of consumer demand, business investment and old age pensions. It expropriates the economic surplus that is created beyond the maintenance of the current living standard into interest on debt.”
2. OFF-SHORING OF MIDDLE CLASS JOBS by Corporations & Wall Street – “What the Corporations and Wall Street have achieved by off-shoring manufacturing jobs and tradable professional job skills such as software engineering & information technology. What they have done by moving these offshore is to recreating the labor market conditions and wage exploitation of the late 19th century.”
3. MANIPULATION OF THE BULLION MARKETS by the Futures Market Bullion Banks – “There is no free market in the futures markets. These are markets that are manipulated.”
I think there is a lot of collusion. For example the government colluded with the banking system in financial deregulation. For example they repealed Glass-Steagall. They expressed this absurd claim that financial markets are self regulating.”
“They turned the financial system into a gambling casino where the bets are covered by the tax payer and central bank.”
The cancer which started in the US Financial System has spread globally. The carriers of the cancer has been the International Banks.

“This is the reason you can’t do anything about Financial Repression!”

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Oh, Mr. Roberts, you couldn’t be more wrong….

There is a powerful new dynamic making its way across America and on into South America and Europe, offering economic liberty and citizen-driven free-market economic rejuvenation.

The Leviticus 25 Plan 2015 –  $70,000 per U.S. citizen                                                    The Leviticus 25 Plan 2015 (800)

Massive global debt hole: nine countries’ debt-to-GDP now exceeds 300%

The global debt load is piling up.                                                                           Japan currently leads the pack with a debt/GDP of 400%.

According to ZeroHedge (2/23/2015), “a whopping 39% of countries have debt-to-GDP of over 100%.”

Central Banks have no other choice but to monetize the gargantuan debt, or brace for a global deflationary depression. Negative economic growth. And chaos.

Over the past 5 years Central Banks have printed, “over $12 trillion in credit-money since Lehman, the bulk of which has ended up in the stock market…”

And now, Central Banks “for the first time ever are about to monetize all global sovereign debt issuance in 2015..”

What does all this mean for millions of citizens in the Western World, and beyond?
It means continued Central Bank domination over economic policies, muted economic growth, continued preferential treatment for global banking conglomerates. And continued debt serfdom for millions of people around the world.

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The Leviticus 25 Plan provides the mechanism for direct access to liquidity for millions of families and massive debt relief at ‘ground level.’

The world needs citizen-directed economic growth, not government-directed allocation of resources. The world needs economic liberty.

There is a legitimate way out of the global debt crater:                                                 The Leviticus 25 Plan 2015 –  $70,000 per U.S. citizen                                                    The Leviticus 25 Plan 2015 (796)

 

2015: Raising teacher pay versus The Leviticus 25 Plan

He who refuses to do arithmetic is doomed to talk nonsense.” – John McCarthy

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Teacher pay’ is a hot topic in many states, and deservedly so. But then, rejuvenating financial health for all working American families is a vital cause, all across America.

All working Americans – military, law enforcement, medical / healthcare, maintenance workers, construction, fire and rescue, service workers – are deserving of an opportunity, a comprehensive initiative, to strengthen their families’ financial status and relieve the burden of government interference in their daily lives.

Let’s do some math, and make a comparison between two significant economic initiatives.

Plan 1: Implement The Leviticus 25 Plan – $70,000 per U.S. citizen.
$50,000 per citizen is electronically deposited into a Family Account and $20,000 per citizen is electronically deposited into a Medical Savings Account.

Who benefits?
Answer: All U.S. citizens and their families.

Who pays?
Answer: The Federal Reserve sets up a funding facility, a Citizens Credit Facility, to channel liquidity to American families, in the same way that they set up various credit facilities to fire-hose liquidity out to scores of U.S. and foreign banks, institutions that had engaged in leveraged speculation and then quickly developed gaping ‘capital holes’ when the big mortgage default wave hit during 2008-2010.

How does the Federal Reserve then get the money back, in order to reduce its balance sheet back down to ‘normal dimensions,’ over time?
Answer: Participating families would be required to give up their tax refunds each year for a period of five years.

Participating families would also be required give up means-tested welfare benefits, income security program benefits, unemployment insurance, workman’s comp, SSI, SSDI, and various other social welfare benefits.

For participating families, there would be a $4,000 deductible for five years ($20,000 total) for those enrolled in Medicare, Medicaid, VA, TRICARE, FEHB.

The Plan pays for itself over a 10-15 year period.

How much would The Leviticus 25 Plan benefit a typical teacher’s family?
Case 1: Family of four. Mother teaches – salary $50,000 / year.
Father also works. Two school-age children.
$100,000 balance on mortgage – maturing in 20 years.
Two modest car loans.
Monthly health care premiums – fairly substantial.

Through the Citizens Credit Facility, $200,000 would be electronically deposited into their Family Account, and $80,000 would be electronically deposited into their Medical Savings Account.

These liquidity grants are tax-free.
The net benefit of these grants would be reduced slightly over the course of time through the loss of income tax refunds for five years (estimate: $5,000 per year for five years: $25,000).

Family pays off $100,000 mortgage balance (estimate: $100,000 at 4% interest / 20-year maturity / principle and interest payment of $605 per month). Total savings / year :$7,260.  This more than offsets the anticipated $5,000 loss from income tax refunds.

Total savings over 20-year maturity: $145,000.  This benefit eliminates $100,000 principle and $45,000 of interest costs on the mortgage.

Family retains $100,000 in Family Account for additional installment debt reduction, discretionary purchases and savings.

With $80,000 in Medical Savings Account, family chooses to purchase a high-deductible ($15,000 / year / family), thereby reducing premium costs by an estimated 40-50%).

Total impact on family financial health: significant.

And even more importantly, all families in America would have a fighting chance to eliminate debt — before the next major ‘financial storm’ hits.

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Plan 2: Raise teachers’ pay by a healthy 15%.

Who benefits?
Answer: Teachers and their families.

Who pays?
Answer: Everyone whose taxes were raised to cover the additional outlay on behalf of teachers. And that would include teachers themselves, whose taxes would also go up – and would therefore slightly reduce the net benefit of a 15% pay raise.

How much would a 15% pay hike actually benefit a typical teacher’s family?
Case 1: Family of four. Mother teaches – salary $50,000 / year.
Father also works. Two school-age children.
$100,000 balance on mortgage – maturing in 20 years.
Two modest car loans.
Monthly health care premiums – fairly substantial.

A 15% pay raise for the teacher in the family would generate additional gross income of $7,500 per year, or $37,500 over a five-year period – before taxes.

This increased income would provide additional resources for some possible modest reductions in mortgage and installment debt, certain discretionary spending, and it might allow for additional modest savings for their children’s future college education.

Teachers and their families would benefit financially, but nobody else would benefit. Mortgage debt reduction: modest.
Health plan premium reduction: none.
Net cash benefit over five years: $37,500.
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America needs a comprehensive economic acceleration plan that benefits all Americans and restores economic liberty..

The choice is clear.

The Leviticus 25 Plan 2015 –  $70,000 per U.S. citizen                                                    The Leviticus 25 Plan 2015 (790)

So how is that big-government central-planning managed economy working out…?

Check out a light sampling of the headlines over the past 3 years…

Welcome To The Recovery: 40% of Americans Live Paycheck To Paycheck (Up From 30% In 2012)

Pentagon spent $504,816 on Viagra last year

Feds Make $100B in Improper Payments a Year...

Feds use stimulus cash to buy Chinese solar panels…

The Five Most Ridiculous Uses of Government MoneyZeroHedge 1/16/2014 While funding custom-fit condoms was stretching the government’s buck just a little too far for some, the following 5 stunning expenses, earmarks, and pork spending that Bloomberg uncovered are mind-blowing. From over $500,000 on pet shampoo to what to eat on planet Mars; none of these compare with the back-pay for no work paid to Federal employees during the shutdown. Watch this 72 seconds of gluttony without throwing something at your monitor…

Gov’t publishes detailed instructions on how to safely roast marshmallows...

Feds pay for film festivals showing decapitated heads, promiscuous teens...

Feds to Spend $500K for New Art at Border Patrol office…

‘GONE OFF THE ROAD’  – Feds spend $300,000 to study how to ride bikes

“Poster Child for Federal Waste” Amidst General Concern About Federal Phone Subsidies, Epic Waste Seen in Universal Service Fund’s Connect America Fund, (Previously the Aptly Named “High-Cost Fund”): Worst Abuses Seen in AK, AZ, CO, HI, MI, OK, TX, and WA.   http://online.wsj.com/article/PR-CO-20130710-909582.html

Medicare And Medicaid Fraud Is Costing Taxpayers Billions – Forbes

May 31, 2012: REVEALED: Federal Government Funds Hardcore Porn as ‘Art’…

Dec 2012: Welfare recipients take out cash at strip clubs, liquor stores, X-rated shops…

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There is a better way…  it is called a citizen-directed allocation of resources…

The Leviticus 25 Plan 2015 –  $70,000 per U.S. citizen                                                    The Leviticus 25 Plan 2015 (788)

 

 

Big government central planning — and the “big lie” of 5.6% unemployment

 

 

Gallup CEO: “America’s 5.6% Unemployment Is One Big Lie”                              ZeroHedge 02/03/2015                                                                                               Excerpts:

The Big Lie: 5.6% Unemployment

The official unemployment rate, as reported by the U.S. Department of Labor, is extremely misleading.
The official unemployment rate, which cruelly overlooks the suffering of the long-term and often permanently unemployed as well as the depressingly underemployed, amounts to a Big Lie.

Gallup defines a good job as 30+ hours per week for an organization that provides a regular paycheck. Right now, the U.S. is delivering at a staggeringly low rate of 44%, which is the number of full-time jobs as a percent of the adult population, 18 years and older. We need that to be 50% and a bare minimum of 10 million new, good jobs to replenish America’s middle class.

I hear all the time that “unemployment is greatly reduced, but the people aren’t feeling it.” When the media, talking heads, the White House and Wall Street start reporting the truth — the percent of Americans in good jobs; jobs that are full time and real — then we will quit wondering why Americans aren’t “feeling” something that doesn’t remotely reflect the reality in their lives. And we will also quit wondering what hollowed out the middle class.

A graphic illustration:


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Seven years of big-government central planning has produced a “staggeringly low rate of 44%… full-time jobs… [among] the adult population” in the U.S..

America needs a radical shift away from the present government-driven economy to a fresh, new citizen-driven economy.

The Leviticus 25 Plan 2015 – $70,000 per U.S. citizen                                                   The Leviticus 25 Plan 2015 (786)

 

HSBC – money laundering, past and present – and access to Fed ‘secret liquidity lifelines’

HSBC Holdings Plc, a British bank and financial services company, is reputed to be the world’s largest bank, operating in 80 countries around the globe. It was founded in 1991 as the Hong Kong Shanghai Banking Corporation (HSBC).

HSBC came under investigation in 2012 for allegedly laundering billions of dollars for drug lords and terrorists. A Senate subcommittee indicated that much of the $7 billion transferred by HSBC from Mexico to its U.S. subsidiary had been related to “drug dealing.”

HSBC was accused of “actively circumventing U.S. safeguards to block transactions involving terrorists, drug lords and rogue regimes, including hiding $19.4 billion in transactions with Iran.”

HSBC admitted wrongdoing and paid a record $1.92 billion in fines to resolve the charges of laundering billions of dollars for Latin American drug cartels (Bloomberg, Jul 3, 2013).

“HSBC was accused of failing to monitor more than $670 billion in wire transfers and more than $9.4 billion in purchases of U.S. currency from HSBC Mexico, allowing for money laundering, prosecutors said. The bank also violated U.S. economic sanctions against Iran, Libya, Sudan, Burma and Cuba, according to a criminal information filed in the case.
…. Lack of proper controls allowed the Sinaloa drug cartel in Mexico and the Norte del Valle cartel in Colombia to move more than $881 million through HSBC’s U.S. unit from 2006 to 2010, the government alleged in the case.”
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During this same “2006 to 2010” period that HSBC was laundering money for drug cartels and violating sanctions on behalf of various state terror sponsors, HSBC was also caught up in the subprime debt crisis – and began receiving emergency funding from the U.S. Federal Reserve (and ultimately, courtesy of U.S. taxpayers).

According to Bloomberg (Nov 22, 2011), HSBC accessed several billions of dollars from Fed emergency funding facilities throughout the fall of 2008 and into the summer of 2009. These included the Term Auction Facility (TAF), Commercial Paper Funding Facility (CPFF), Temporary Security Lending Facility, Single-Tranche Open Market Operations (STOMO) and the Fed’s Discount Window (DW).

Peak Amount of Debt on 3/12/2009: $3.7B
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And here is the latest, hot off the presses – HSBC is at it again:                                             (Bloomberg (Feb 9, 2015) – The private-banking unit of HSBC Holdings Plc made significant profits for years handling secret accounts whose holders included drug cartels, arms dealers, tax evaders and fugitive diamond merchants, according to a report released Sunday by an international news organization. 

These latest charges include laundering money for Russian billion oligarchs with close ties to Putin.

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And now for our question of the month:
If large multi-national banks, including foreign banks like HSBC, can conspire against the security interests of the United States and at the same time be granted direct access to billions of dollars through Fed liquidity lines, then what could possibly be the rationale for U.S. citizens NOT being granted equal access…?

Answer:  There isn’t any.

And here we have one of the biggest U.S. taxpayer ‘screw-overs’ of the past 20 years.  And U.S. citizens cannot get the same direct liquidity access that our government provided for HSBC.

It is a travesty of the highest order.

The answer: The Leviticus 25 Plan 2015 – $70,000 per U.S. citizen                             :                     The Leviticus 25 Plan 2015 (773)

Natixis SA – #30 recipient of Fed’s “secret liquidity lifelines”

Natixis SA is a large French corporate and investment bank that took a big ‘hit’ in the fall of 2008 when the massive Bernard Madoff $50 billion mega-fraud ponzi scheme blew up on it and a lot of other big ‘players’ in the world of global finance.

Natixis’ exposure in the Madoff fiasco was estimated at 450 million euros ($605 million).

Natixis had also during this time been riding the red-hot subprime bandwagon, and when the mortgage default wave steamrolled through, Natixis’ got walloped again.  Their write-downs topped out at $1.75B.

Natixis needed liquidity to survive, and the got it – courtesy of the U.S. Federal Reserve (and U.S. taxpaying citizens).
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Bloomberg  Nov 28, 2011  –  Excerpts:
Natixis SA reported the biggest net losses of any French bank during the financial crisis and kept an outstanding balance of more than $10 billion of loans from the U.S. Federal Reserve for six months. The loans peaked on Dec. 22, 2008, when the Paris-based bank was borrowing $15.5 billion from the Fed’s Commercial Paper Funding Facility and Term Auction Facility.

In February 2009, Natixis‘s main shareholders, Groupe Banque Populaire and Groupe Caisse d’Epargne, announced they would merge to form Groupe BPCE, and the French government bought about 3 billion euros ($4.25 billion) of preferred shares in the combined entity and 4 billion euros of subordinated debt. The deal closed in July 2009. Natixis paid off the last of its Fed loans in January 2010.

Peak amount of debt on 12/22/2008: $15.5B

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And so here we have a large foreign bank getting sucked into some high-risk, speculative  financial ventures, losing big…. and getting bailed out by the Fed.

Natixis tapped the Fed’s Commercial Paper Funding Facility, Term Auction Facility and Discount Window for a cool $15.5B.

‘Thank you,’ U.S. taxpayers…

And now it is time for fair play.  U.S. citizens deserve nothing less than the same access to liquidity (it’s our money after all) that was so generously extended to Natixis, and many other, during their ‘time of need.’

The mechanism: A Federal Reserve Citizens Credit Facility.

The Leviticus 25 Plan 2015 – $70,000 per U.S. citizen                                                   The Leviticus 25 Plan 2015 (767)

p.s.  For the record, Société Générale’, BNP Paribas, HSBC, and Royal Bank of Scotland (RBS) were among other big banks with large exposure to the Madoff ponzi investments, along with massive exposure to subprime leveraged speculation – and also received Fed emergency loan funds (courtesy of the U.S. taxpayer).

 

Nanny state America – heading for a fiscal cliff. There is one Plan to set America back on course…

Congress has no plan to help move America off the dependency treadmill.  The U.S. Congress actually constructed the massive social welfare machine with its perverse disincentives that penalize hard work, industriousness and thrift – and reward ‘low energy’ living and dependence on the state.

Treasury, the Fed – no plan.

Here’s where we’re at – and note that the 3rd column features data that is over 2 years old.

Eberstadt Winter 2015 Table VERY SMALL

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There is a way out – a creative plan that will relight the fires of self-reliance, independence, and economic liberty in America.

The Leviticus 25 Plan 2015 – $70,000 per U.S. citizen                                                   The Leviticus 25 Plan 2015 (765)