The squid abides:
But on the political fringes there are already those portraying Mr Monti – who is listed by Goldman Sachs, the investment bank, on its board of international advisers – as a tool of the “masters of the universe”, along with Mario Draghi, head of the European Central Bank and former Goldman Sachs executive.
“This is the band of criminals who brought us this financial disaster. It is like asking arsonists to put out the fire,” commented Alessandro Sallusti, editor of Il Giornale, a Milan daily owned by the Berlusconi family.
From the most recent Goldman annual report:
THEY THE PARASITES STEAL WHATEVER THEY CAN WHEN PEOPLE STAND BY AND WATCH DOING NOTHING!
The Banksters are “Stealing Governments”: Mario Monti, Italy’s New PM
The “Shock Doctrine” is clearly at work again. Look at Italy’s new leader’s credentials, Mario Monti
Monti is the first chairman of Bruegel, a European think tank founded in 2005, and he is European Chairman of the Trilateral Commission, a think tank founded in 1973 by David Rockefeller. He is also a leading member of the Bilderberg Group. Monti is an international adviser to Goldman Sachs and The Coca-Cola Company.
In Greece the new PM Lucas Papademos served on the Federal Reserve of Boston!
He has served as Senior Economist at the Federal Reserve Bank of Boston in 1980. He joined the Bank of Greece in 1985 as Chief Economist, rising to Deputy Governor in 1993 and Governor in 1994. During his time as Governor of the national bank, Papademos was involved in Greece’s transition from the drachma to the euro as its national currency. After leaving the Bank of Greece in 2002, Papademos became the Vice President to Jean-Claude Trichet at the European Central Bank from 2002 to 2010. In 2010 he left that position to serve as an advisor to Prime Minister George Papandreou. He has been a member of the Trilateral Commission since 1998.
You can’t make this stuff up, the Banksters are now just out right stealing governments and will perpetuate debt slavery and socialize their losses.
MAKING ME START TO THINK- EUROPEANS DESERVE ALL THATS’ COMING THEIR WAY- WITHOUT A BACKBONE SURVING IS A WASTE OF TIME….
“Vulture Capitalism”: Iceland’s New Bank Disaster
A Dress Rehearsal for Greece and Italy?
by Olafur Arnarson and Michael Hudson and Gunnar Tomasson
The problem of bank loans gone bad, especially those with government-guarantees such as U.S. student loans and Fannie Mae mortgages, has thrown into question just what should be a “fair value” for these debt obligations. Should “fair value” reflect what debtors can pay – that is, pay without going bankrupt? Or is it fair for banks and even vulture funds to get whatever they can squeeze out of debtors?
The answer will depend largely on the degree to which governments back the claims of creditors. The legal definition of how much can be squeezed out is becoming a political issue pulling national governments, the IMF, ECB and other financial agencies into a conflict pitting banks, vulture funds and debt-strapped populations against each other.
This polarizing issue has now broken out especially in Iceland. The country is now suffering a second round of economic and financial distress stemming from the collapse of its banking system in October 2008. That crisis caused a huge loss of savings not only for domestic citizens but also for international creditors such as Deutsche Bank, Barclay’s and their institutional clients.
Stuck with bad loans and bonds from bankrupt issuers, foreign investors in the old banks sold their bonds and other claims for pennies on the dollar to buyers whose web sites described themselves as “specializing in distressed assets,” commonly known as vulture funds. (Persistent rumors suggest that some of these are working with the previous owners of the failed Icelandic banks, operating out of offshore banking and tax havens and currently under investigation by a Special Prosecutor.)
At the time when those bonds were sold in the market, Iceland’s government owned 100% of all three new banks. Representing the national interest, it intended for the banks to pass on to the debtors the write-downs at which they discounted the assets they bought from the old banks. This was supposed to be what “fair value” meant: the low market valuation at that time. It was supposed to take account of the reasonable ability of households and businesses to pay back loans that had become unpayable as the currency had collapsed and import prices had risen accordingly.
The IMF entered the picture in November 2008, advising the government to reconstruct the banking system in a way that “includes measures to ensure fair valuation of assets [and] maximize asset recovery.” The government created three “good” new banks from the ruins of its failed banks, transferring loans from the old to the new banks at a discount of up to 70 percent to reflect their fair value, based on independent third party valuation.
The vultures became owners of two out of three new Icelandic banks. On IMF advice the government negotiated an agreement so loose as to give them a hunting license on Icelandic households and businesses. The new banks acted much as U.S. collection agencies do when they buy bad credit-card debts, bank loans or unpaid bills from retailers at 30% of face value and then hound the debtors to squeeze out as much as they can, by hook or by crook.
These scavengers of the financial system are the bane of many states. But there is now a danger of their rising to the top of the international legal pyramid, to a point where they are in a position to oppress entire national economies.
Iceland’s case has a special twist. By law Icelandic mortgages and many other consumer loans are linked to the country’s soaring consumer price index. Owners of these loans not only can demand 100% of face value, but also can add on the increase in debt principal from the indexing. Thousands of households face poverty and loss of property because of loans that, in some cases, have more than doubled as a result of the currency crash and subsequent price inflation. But the IMF and Iceland’s Government and Supreme Court have affirmed the price-indexation of loan principal and usurious interest rates, lest the restructured banking system come to grief.
This is not what was expected. In 2009 the incoming “leftist” government negotiated an agreement with creditors to relate loan payments to the discounted transfer value. On IMF advice, the government handed over controlling interest in the new banks to creditors of the old banks. The aim was to minimize the cost of refinancing the banking system – but not to destroy the economy. Loans that were transferred from the old banks to the new after the 2008 crash at a discount of up to 70% to reflect their depreciated market value. This discount was to be passed on to borrowers (households and small businesses) faced with ballooning principal and payments due to CPI indexing of loans.
But the economy’s survival is not of paramount interest to the aggressive hedge funds that have replaced the established banks that originally lent to the Icelandic banks. Instead of passing on the debt write-downs to households and other debtors, the new banks are revaluing these loan principals upward. Their demands are keeping the economy in a straight jacket. Instead of debt restructuring taking place as originally hoped for, the scene is being set for a new banking crisis.
Something has to give. But so far it is Iceland’s economy, not the vulture funds. With the IMF insisting that the government abstain from intervention, the government’s approval rating has plunged to just 10% of Icelanders for floundering so badly while the new owners call the shots.
The New Banks have written off claims on major corporate debtors, whose continued operations have ensured their role as cash cows for the banks’ new vulture owners. But household debts acquired at 30 to 50 percent of face value have been re-valued at up to 100 percent. The value of owners’ share equity has soared. The Government has not intervened, accepting the banks’ assertion that they lack the resources to grant meaningful debt relief to households. So unpayably high debts are kept on the books, at transfer prices that afford a windfall to financial predators, dooming debtors to a decade or more of negative equity.
With the preparatory work done, the time has come for the Vultures to cash in through re-sale of New Bank equity shares by yearend. The New Banks have kept their corporate cash cows afloat while window-dressing owners’ equity with unrealistic valuations of consumer debts that cannot be paid, except at the cost of bankrupting the economy.
There is a feeling that Iceland’s government has been disabled from acting as an honest broker, as bank lobbyists have worked with Althing insiders – now backed by the IMF – to provide a windfall for creditors.
The problem becoming a global one. Many European countries and the United States face collapsed banks and derailed banking systems. How are the IMF and ECB to respond? Will they prescribe the Icelandic-type model of collaboration between Government and hedge funds? Or should the government be given power to resist drive by vulture funds to profiteer on an international scale, backed by international sanctions against their prey?
The policy danger now facing Europe
An economic crisis is the financial equivalent of military conquest. It is an opportunity for financial elites to make their property grab as Foreclosure Time arrives. It also becomes a political grab to make real the financial claims that had become uncollectible and hence largely fictitious “mark-to-model” accounting. Populist rhetoric is crafted to mobilize the widespread financial distress and general discontent as an opportunity to turn losers against each other rather than at the creditors.
This is the point at which all the years of financial propaganda pay off. Neoliberals have persuaded the public to believe that banks are needed to “oil the wheels of commerce” – that is, provide the credit bloodstream that brings nourishment to the economy’s moving parts. Only under such crisis conditions can banks collect what has become a fictitious buildup of debt claims. The overgrowth of mortgage debt, corporate debt, student loans, credit-card debt and other debts are fictitious because under normal circumstances there is no way for them to be paid.
Foreclosure Time is not sufficient, because much property has fallen into negative equity – about a quarter of U.S. real estate. And for Ireland, market value of real estate covers only about 30% of the face value of mortgages. So Bailout Time becomes necessary. The banks turn over their bad loans to the government in exchange for government debt. The Federal Reserve has arranged over $2 trillion of such bank-friendly swaps. Banks receive government bonds or central bank deposits in exchange for their bad debts, accepted at face value rather than at “mark-to-market” prices.
At least in the United States and Britain, the central bank can print as much domestic currency as is necessary to pay interest and keep these government bonds liquid. Public agencies then take on the position of creditor vis-à-vis debtors that can’t pay.
These public agencies then have a choice. They may seek to collect the full amount (or at least, as much as they can get), as in the case of Fannie Mae and Freddie Mac in the United States. Or, the government may sell the bad debts to vulture funds, for a fraction of their face value.
After the September 2008 crash, Iceland’s government took over the old, collapsed, banks and created new ones in their place. Original bondholders of the old banks off-loaded the Icelandic bank bonds in the market for pennies on the dollar. The buyers were vulture funds. These bondholders became the owners of the old banks, as all shareholders were wiped out. In October, the government’s monetary authority appointed new boards to control the banks. Three new banks were set up, and all the deposits, mortgages and other bank loans were transferred to these new, healthier banks – at a steep discount. These new banks received 80 percent of the assets, the old banks 20 percent.
Then, owners of the old banks were given control over two of the new banks (87% and 95% respectively). The owners of these new banks were called vultures not only because of the steep discount at which the financial assets and claims of the old banks were transferred, but mainly because they already had bought control of the old banks at pennies on the dollar.
The result is that instead of the government keeping the banks and simply wiping them out in bankruptcy, the government kept aside and let vulture investors reap a giant windfall – that now threatens to plunge Iceland’s economy into chronic financial austerity. In retrospect, none of this was necessary. The question is, what can the government do to clean up the mess that it has created by so gullibly taking bad IMF advice?
In the United States, banks receiving TARP bailout money were supposed to negotiate with mortgage debtors to write down the debts to market prices and/or the ability to pay. This was not done. Likewise in Iceland, the vulture funds that bought the bad “old bank” loans were supposed to pass on the debt write-downs to the debtors. This was not done either. In fact, the loan principals continued to be revalued upward in keeping with Iceland’s unique indexing designed to save banks from taking a loss – that is, to make sure that the economy as a whole suffers, even suffering a fatal austerity attack, so that bankers will be “made whole.” This means making a windfall fortune for the vultures who buy bad loans on the cheap.
Is this the future of Europe as well? If so, the present financial crisis will become the great windfall for vulture banks, and for banks in general. Whereas the past few centuries have seen financial crashes wipe out the savings and creditor claims (bonds, bank loans, etc.) that are the counterpart to bad debts, today we are seeing the bad debts kept on the books, but the banks and bondholders that provided the bad loans being made whole at taxpayer expense.
This is not how economic democracy was expected to work during the 19th-century drive for Parliamentary reform. And by the early 20th century, social democratic and labor parties were supposed to take the lead in moving banking and credit along with other basic infrastructure into the public domain. But today, from Greece to Iceland, governments are acting as enforcers or even as collection agents on behalf of the financial sector – as the Occupy Wall Street movement expresses it, the top “1%,” not the bottom 99%.
Iceland stands as a dress rehearsal for this power grab. The IMF and Iceland’s government held a conference in Reykjavik on October 27 to celebrate the ostensible success in their reconstruction of Iceland’s economy and banking system.
In the United States, the crisis that Obama Chief of Staff Rahm Emanuel celebrated as “too good to let go to waste” will be capped by scaling back Social Security and Medicare as soon as the autumn Doomsday Clock runs down and the Congressional Super-Committee of 12 (with President Obama holding the 13th vote in case of a tie) gets to agree to make the working population pay Wall Street for its bad loans. The Greek austerity plan thus serves as a dress rehearsal for the U.S. – with the Democratic Party playing the role as counterparts to Greece’s Socialist Party that is sponsoring austerity, and expelling labor union leaders from its ranks if they object to the grand double-cross.
*Olafur Arnarson is an author and columnist at Pressan.is. Michael Hudson is Prof. of Economics at UMKC. Gunnar Tomasson is a retired IMF advisor. 2,255 words
Global Research Articles by Olafur Arnarson
Global Research Articles by Michael Hudson
Global Research Articles by Gunnar Tomasson
WHAT IS ANTI-SEMITISM?
Anti-Semitism might be called anti-imperialism. At heart, it is opposition to the plan of the central bankers, based in the City of London, to “gradually absorb the wealth of the world” and establish a masked “world government” dictatorship.
This involves stupefying and degrading society through faux education, porn and violence; and bankrupting and brutalizing us through war, pandemics and domestic repression.
It involves destroying “all collective forces except our own” which means destroying all race, religion, (God), nation and family. They use social engineering like diversity, feminism, multiculturalism and homosexuality to accomplish these aims. (I like homosexuals & different races; I just don’t think they should be used as a weapon.)
The bankers place cooperative Jews in positions of control. The stigma attached to anti-Semitism is a form of mind control used to immunize their agents and their agenda against criticism. The Holocaust is callously used for this purpose.
If we think of anti-Semitism in terms of opposition to the bankers’ political and cultural policy rather than to a race, it can be justified. The key is to distinguish between Jews who advance the New World Order and those who do not.
JEWS ARE THE BIGGEST DUPES
Socialism and Communism are Jewish in origin, membership and character. Throughout the past century, naïve Jews flocked to the Red banner. The clarion call: “Capitalists have all the wealth. Communism will result in equality.”
This clarion call was just bait. The richest people in the world created & financed Communism; their agenda was to further concentrate wealth. Socialism is the same thing on a smaller scale, a way of electing world banker lackeys and increasing government power. (Socialism may have some intrinsic merit but this is not why they back it.)
The false conflict between “public” and “private”; Left and Right; government and free enterprise; keeps the public in a political trance.
Jews like Noam Chomsky and Naomi Klein uphold this false dichotomy. They blame everything on the private sector, on corporations, on US imperialism. Left versus Right. Government vs Free Enterprise.
The truth is the corporations she vilifies own both her publisher and the politicians Right and Left. Public vs Private is meaningless today because Private controls Public (through debt.)
In a recent profile Ms. Klein says: “I don’t question being a leftist any more than I would question being a Jew it’s the culture I got taught as a kid.”
The day when Naomi Klein advocates government take control of its credit, or traces the Mossad role in 9-11, will be the day she disappears from the mass media. She is an example of what many socialist Jewish dupes do best; control the debate, enrich themselves and wax self-righteous as benefactors. They are the company union.
In 2004, I wrote: “Anti-Semitism is not an irrational hatred or sickness in the Gentile soul, as Jews imagine. It is a healthy defense mechanism of mainly Christian and Moslem nations, cultures, races and religions that are threatened by a gradual and insidious process of extinction (i.e. world government.)”
If anti-Semitism is opposition to the world banker agenda, rather than to all Jews heedless of their role, then I see anti-Semitism as a healthy sign.
We cannot allow them to use this disingenuous ploy to outlaw Resistance to Tyranny. Jews…everyone… must not be manipulated any longer. Its not Jews nor Gentiles but Satanists who control the world.
Related: “Which Hidden Power Created Hitler?” and “The Zionist Protection
Henry Makow Ph.D. is the author of “Cruel Hoax: Feminism and the New
World Order.” http://www.cruelhoax.ca) His articles can be found at his web
site http://www.1henrymakow.com He enjoys receiving comments, some of which he
posts on his site using first names only. email@example.com
Dr. Makow, I’m half-Jew who has been awakening from the mental programming for the past couple years ever since I started investigating 9/11. Your site has always provided great articles that helped expand my quest from just “9/11 Truth” to so much more.
I found the recent article on Jews ‘owning the world’ quite well- articulated, and it occurred to me that you may be interested in an anti-Zionist song my band just recorded called “Pavlov’s Jews.”
It addresses the blind obedience the average Jew gives to Zionism, Holocaust guilt, and the general burdens we’re forced to endure from infancy. Now, it is a crazy thrash metal song which may be too intense for a middle-aged guy, so here are also the printed lyrics 😉
“Never again” and “Never forget”
words that sanction any dark deed.
They use the Holocaust
to justify their crimes
And you’re too afraid
to challenge their lies
cloak themselves in Judaism,
banking on credulity
they hand-feed you propaganda.
Members of the Diaspora
bonded by burden not by blood
We are made insane by the
mountains of martyrs
dumped upon our poor blank slates.
Don’t research history
just believe what they say
Like a good little dog
they know that you’ll obey
Bark when they say bark
Jump when they say jump
Don’t think for yourself
Leave that up to someone else
You don’t see the danger
lurking in the distance
We’ll die for their crimes
they’ll hide and survive
They scream anti-Semite
and then it’s time to hate
When they cry poor
you rush to donate.
The guilt oozes
through your veins
Praise your masters
tugging the reigns.
Crushed by the burden
of historical guilt
lifetime of good deeds
impossible to surmount.
We never made a commitment
but always feel obligated
haunted by infamous slaughters
like Granada in 1066.
Pogroms and massacres
Details to be memorized
“By deception thou
shalt do war”
Is Mossad at the door?
We’re always under attack
But maybe there’s a reason
every hundred years
some country kicks our ass!
Refuse to play
the part scripted for a Jew
commit a worse sin
than a Christian, Muslim, or Hindu.
But maybe this generation
will not be afraid
maybe we’ll see who
we truly ought to hate.
Be different from the different
Choose to be unchosen.
lyrics copyright 2007 I Dream of Apocalypse