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Archives by Tag 'debt'
The Leveraged Buyout of America
ELLEN BROWN
Giant bank holding companies now own airports, toll roads, and ports; control power plants; and store and hoard vast quantities of commodities of all sorts. They are systematically buying up or gaining control of the essential lifelines of the economy. How have they pu...
The Mystery of S&P Debt Ratings
DEAN BAKER
S&P announced last week that it was upgrading its assessment of U.S. debt, shifting its outlook to neutral from negative, suggesting that it may restore its highest Aaa rating in the not-too-distant future. While we may all want to celebrate S&P’s vote of confid...
Deflation Smackdown
MIKE WHITNEY
“Under a fiat money system, a government… should always be able to generate increased nominal spending and inflation, even when the short-term nominal interest rate is at zero.” Ben S. Bernanke, “Deflation: Making...
What Deficit Reduction is Really About: Weakening Workers’ Bargaining Power
DEAN BAKER
Few academic papers have ever received as much attention or had as much influence on public policy as “...
Bernanke Drives Margin Debt to Pre-Crisis Highs
MIKE WHITNEY
Investors have boosted their borrowing to near-record levels to load up on stocks.   The last time that margin debt was this high was just before the bubble burst in 2007.  In January, New York Stock Exchange (NYSE) margin debt tipped $366 billion,  just shy of the 2...
Krugman vs. Stockman
MIKE WHITNEY
It was no Rumble in the Jungle, that’s for sure. There were no blindside blows to the ribs, no bone...
The BoJ’s Kuroda Wheels Out the Heavy Artillery
MIKE WHITNEY
“Almost the entire rich world is stuck in a zero interest rate liquidity trap situation, and I think everybody is haunted by the possibility that there’s no way out of it. If Japan shows a way out of that, it will be very encouraging.” – G...
Dow Sets Record On Fed’s QE
MIKE WHITNEY
The Dow Jones Industrial Average (DJIA) roared to an all-time high on Friday wrapping up a 4-day winning streak and shrugging off grim reports of government budget cuts that are expected to slow growth. The Dow rose 67 points on the day to close at 14,397 passing the prev...
The Effects of the ‘Fat Cat’ Vote
BINOY KAMPMARK
The soup is seldom eaten as hot as it is served. Swiss expression, quoted by Philip Mosimann, CEO of Bucher Industries AG, Mar 5, 2013 They surprise and stun wi...
Will Grillo Break the Euro?
MIKE WHITNEY
Italy’s elections could signal the end of the euro or they could mean nothing at all. It’s impossible to know just yet. But one thing is certain, Italians have “had it up to here” with austerity. Nearly 60 percent of the electorate voted for candid...
Socialize Costs, Privatize Profits
DAVID ROSEN
There’s a truism about the U.S. political-economy, one being shared by an increasing number of people from all walks of life and political persuasions: the game is rigged! There are two aspects to the rigged game.  One involves the privatization of public servic...
Warning: Stocks Likely to Crater from Here
CHRIS MARTENSON
I don’t relish the job of constantly pointing out the risks to the equity markets. But since few on Wall Street seem willing (or able) to do this, I’m “making the call” for a market correction, as enough variables have aligned to indicate a high li...
LIBOR: Viewing the Biggest Financial Crime in History
DARWIN BOND-GRAHAM
It’s been five years since a few academics and ...
The Greek Economy is Kaput
MIKE WHITNEY
“The Greek economy is finished. The Greek economy is in a great, great depression… There is no power, no force within the Greek economy, within Greek society that can avert it….Imagine if we were in Ohio in 1931 and we were to ask: What can Ohio poli...
Much Ado About Nothing in Budget Debate
DAVE LINDORFF
All the sturm and drang in Washington over the March 1 deadline for a budget deal is an act. Two acts really. The Republicans are pretending that if we don’t have budget cuts this year, the whole US economy will collapse because of the nation’s enormous indebte...
A Quest for New Jobs Where None Exists
JOHN WALSH
“Those jobs are not coming back.” The late Steve Jobs to Barack Obama. Hot on the heels of his State of the Union address with its emphasis on the moribund job market,...
Still Clueless About the Economy
DEAN BAKER
The latest fad in Washington economic policy debates is arguing over the level at which the government should stabilize the debt-to-GDP ratio. The doves are okay with a debt-to-GDP ratio of 73 percent or even 76 percent. The hawks want 60 percent or even less. This is the...
Fix the Debt’s Blind Spot
DEAN BAKER
At this point everyone knows about Fix the Debt. It is a collection of corporate CEOs put together by Peter Peterson, the Wall Street private equity mogul. Ostensibly they want to reduce budget deficits and the national debt, but for some reason their attention always see...
Obama and Europe’s Meltdown
CONN HALLINAN
Back in the 1960s, the U.S. peace movement came up with a catchy phrase: “What if the schools got all the money they needed and the Navy had to hold a bake sale to buy an aircraft carrier?”  Well, the Italian Navy has a line of clothing, and is taking a cut from a so...
Immigration and Debt
TOM BARRY
The Ixil Triangle –the rugged mountain home of the Ixil Maya in Guatemala’s Altiplano — was the center of the Guatemalan Army’s counterinsurgency campaign three decades ago. It was also a destination for progressive writers, researchers, and photographer...
Elite Optimism Amid Endless Crisis
BEN SCHREINER
An economic recovery has begun. - President Obama, Second Inaugural Address President Obama’s optimism — baseless as it may be — was s...
The Fed’s Plan B
MIKE WHITNEY
“How do you solve a problem when you’re running a 10% fiscal budget deficit? You are not going to get growth without private sector credit demand. The government’s idea right now is that we’re going to export our way out of this, and when I asked a...
The Trillion Dollar Cat Shit Coin
ROB URIE
Some fair proportion of readers are already aware of the proposal to have the U.S. Mint produce a $1 trillion face amount coin to be deposited at the Federal Reserve and credited to the account of the Treasury Department to pay Federal bills. The $1 trillion would render ...
Deficit, Debt and Decline
MICHAEL BRENNER
Washington’s foreign policy establishment is wringing its hands over the deficit. They voice fears that America’s dominant position in the world will be jeopardized by tight budgets and lingering austerity that lowers its influence on all manner of global economic mat...
The Fiscal Cliff and Other Distractions
DEAN BAKER
We have just passed into the new year, and the distractions created by the debate over the fiscal cliff appear to be behind us. Maybe. That debate has been part of a larger distraction — the concern over budget deficits at a time when by far the count...
America’s Deceptive 2012 Fiscal Cliff
MICHAEL HUDSON
When World War I broke out in August 1914, economists on both sides forecast that hostilities could not last more than about six months. Wars had grown so expensive that governments quickly would run out of money. It seemed that if...
Austerity — the Battle Cry of the 1%
MARK VORPAHL
Whether we are left with the Fiscal Cliff or a Grand Bargain, workers in the U.S. face massive cuts to programs such as Medicare, Medicaid, Social Security, unemployment insurance, Food Stamp assistance and other needed social safety nets. This is an example of “aus...
Saving the Planet or Fixing the “Debt”?
DEAN BAKER
Imagine Japan attacked at Pearl Harbor in December of 1941 and our political leaders responded by debating the best way to deal with the deficits projected for 1960. This is pretty much the way that Washington works these days. The political leadership, including t...
Democrats and the Fiscal Cliff
SHAMUS COOKE
Literally the day after the election a sudden “urgency” gripped the nation: the imminent danger of the so-called “fiscal cliff” — the national automatic tax increases and spending cuts due in January. The media screamed that the suddenly approach...
Obama and the Triumph of Small Margins
BINOY KAMPMARK
‘No way Mittiepoo!’  ‘Mitt Romney is checking the math.  That’s why its taking so long.’   The hubris, the excitement, and the ugliness of the cheering.   The swear words on social media are being cast with a good dosage of bile.  There have been “O...
American Students: the Coal Miners of Today
DARWIN BOND-GRAHAM
Bob Meister isn’t the kind of man who comes across as a radical. He’s a bespectacled grey-haired intellectual who looks comfortable in the sort of suit and tie a distinguished professor would wear. That’s probably because he is a professor, a quite disti...
The Consumer Financial Protection Bureau’s First Big Sellout
MIKE WHITNEY
So now we know why the banks fought tooth-and-nail to prevent Elizabeth Warren from heading the Consumer Financial Protection Bureau (CFPB). It’s because they were already planning their next big coup and didn’t want Warren in a position where she could make w...
Canada’s Housing Bubble Set to Burst
MIKE WHITNEY
Canada’s housing bubble is about to burst, and when it does, hundreds of billions of dollars in equity will be wiped out, unemployment will spike, and the economy will sink into a protracted slump. We know this will happen, because the same scenario unfolded in th...
The Myth That Japan is Broke
ELLEN BROWN
In an April 2012 article in Forbes titled “...
How Far is the ECB Really Prepared to Go to Save the Euro?
MARSHALL AUERBACK
Re-reading Mr Draghi’s market-moving remarks earlier this week, one gains a sense that the European Central Bank chief recognizes that the ECB has a banking run on their hand. Most market participants have understandably focused on Mr Draghi’s pledge that the ...
The Political Pathology of Deficit Panic
MATTEA KRAMER
We’re at the edge of the cliff of deficit disaster!  National security spending is being, or will soon be, slashed to the bone!  Obamacare will sink the ship of state! Each of these claims has grabbed national attention in a big way, sucking up years’ worth o...
Government by the Banks and For the Banks
ELLEN BROWN
On Friday, June 29th, German Chancellor Angela Merkel acquiesced to changes to a permanent Eurozone bailout fund—“before the ink was dry,” as critics complained.  Besides easing the conditions under which bailouts would be given, the concessions included an agreeme...
China Embraces Ponzi-Bonds
MIKE WHITNEY
China is preparing to launch a program that will create the same complex debt-instruments that triggered the global financial crisis in 2008. The pilot program will allow banks to convert pools of loans into securities via off-balance shee...
Glamorous Servitude and Sexy Debt
KATHLEEN PEINE
When Earl Butz said “get big or get out”- well, they got out. It was nearing the appropriate time anyway, they were getting old enough to merit a retirement. But truly, the world of “big” requires the working class to borrow enormous amounts to achieve such...
Occupy is Alive; So is History
ROB URIE
Political leadership in the West has calcified atop a set of existing facts and trajectory that assure rebellion in one form or another until they are reconciled. In addition to the economic divides between wealth and poverty, employment and unemployment, opportunity and ...
Why the Senate Won’t Touch Jamie Dimon
ELLEN BROWN
When Jamie Dimon, CEO of JPMorgan Chase Bank, appeared before the Senate Banking Committee on June 13, he was wearing cufflinks bearing the presidential seal.  “Was Dimon trying to send any particular message by wearing the presidential cufflinks?” ...
Empty Talk From the G8
VIJAY PRASHAD
WHEN the Group of Seven (G7) was formed in 1974, its charge was to provide confidence to a global population uncertain about the major structural features in the world. The members of the G7 were Canada, France, Italy, Japan, the United Kingdom, the United States and West...
Hope Reborn at the Antifest
ERIC TOUSSAINT
Sarajevo, capital of Bosnia-Herzegovina, a country ravaged by a war that between 1992 and the beginning of 1996 caused 100.000 deaths (exact figures are unavailable), is certainly looking a lot better but the social situation is dramatic. One statistic says it all: ...
The Student Debt Bomb
LAURA FLANDERS
President Obama doled out the most shocking stream of commencement cliches to the graduating class of Barnard College Monday. To offer just a taste: “The question is not whether things will get better — they always do… The question is whether ...
The Subsidized Student Loan Scam
DAVE LINDORFF
The Senate is currently deadlocked on taking action to prevent the interest on new Stafford guaranteed student loans from rising on July 1 from 3.4% to 6.8%, with Democrats saying they want to “pay for” keeping the current “lower” 3.4% rate by closing a loophole t...
When the Rich Jump Ship
DAVID MACARAY
In the wake of the 2008 financial meltdown, one of the arguments you heard Republican economists and Wall Street executives repeatedly use to defend the amounts of money being paid investment bankers and hedge fund managers was that if these guys didn’t receive exorbita...
Our Very Own Oscar Night in Rimini
MICHAEL HUDSON
I have just returned from Rimini, Italy, where I experienced one of the most amazing spectacles of my academic life. Four of us associated with the University of Missouri at Kansas City (UMKC) were invited to lecture for three days on Modern Monetary Theory (MMT) and...
America’s Lost Decade
MARK WEISBROT
The American Economic Association’s annual meetings are a scary sight, with thousands of economists all gathered in the same place – a veritable weapon of mass destruction.  Chicago was the lucky city for 2012 this past weekend, and I had just finished participating ...
Greece in Chaos
NOËLLE BURGI
“Who knows what tomorrow will bring?” people ask in Athens, Salonika and right across Greece. There’s a sense of collective imprisonment, individual uncertainty and impending catastrophe. Yet Greece has had a turbulent history, and the Greeks have always...
Rule By Troika
SERGE HALIMI
Former bankers Lucas Papademos and Mario Monti have taken over in Athens and Rome, exploiting the threat of bankruptcy and the fear of chaos. They are not apolitical technicians but men of the right, members of the Trilateral Commission that blamed western societies for b...