Posts Tagged ‘Banks’

Evil Mood Propagating: Our Lords Are Too Big To Jail

September 23, 2015

Volkswagen (VW), for a few months the world’s largest automaker, installed a software that enabled a car to emit much less pollution when a test was conducted than it really did when it was operated for real. Out there on the streets the cars in question were emitting 40 times more pollution. There are at least 11 million such cars (11 x 10^6).

It was not a victimless crime: the World Health Organization (WHO) estimates that air pollution from fossil fuels kills seven million people a year. In France alone, the government, which has favored polluting diesel cars (after making a scientific mistake, it claims) admits that 40,000 people die, each year from pollution caused mostly by cars.

Adolf Hitler (Sitting) Created Volkswagen

Adolf Hitler (Sitting) Created Volkswagen

Logically, the boss of VW, or those responsible (if they lied to their boss) ought to go to jail, for many, many years. Letting it happen that people would be gazed in extermination camps was often punished by death after World War Two (eleven thousands Nazis were executed in Germany). On the face of it, I have a problem seeing a distinction between that, and the behavior of VW. In both cases, it’s all about killing people, deliberately, to augment one’s power.

So why did the leaders of VW sink so low?

It’s the mood of the times. If Obama sees a wedding in Yemen, and he is told that has the “SIGNATURE” of a terrorist gathering, he orders to execute the wedding crowd, with remotely piloted bombing robots. Nobody “serious” sees a problem with that. Why can’t the boSS of VW do the same?

The mood of the time is that, when a big bank launders money for drug trafficking, it is told, if caught with enough evidence, to pay a fine, and the charges will be dropped. Excuse me? There would be no drug trafficking if the money could not be transported, and laundered. In other words, no big banks, no big drug trafficking. The first drug lords to jail ought to be the big bankers who partake in the activity. The boss of VW knew this: I am sure he read the papers, occasionally. So why can’t he do the same?

Surely, to spew lethal gases in the streets of the world, is not much worse than financing terrorist Islamist  networks, as some big western banks such as HSBC more or less did not have to admit they did, once they paid a few billions of official blackmail. A few months ago.

Meanwhile some hedge fund managers made billions, in just one year, paying no tax to speak of. These billions were stolen to everybody else. Why can’t the boss of VW steal billions too? Is not his company more important?

The mood of corruption has been propagating worldwide: after all, if you spend nearly as much as the average family income in the USA, and IF (a big if) the plutocrats invite you, you can meet with the president of the USA. That’s corruption. And they call that “democracy”, piling up corruption of the soul on top of corruption of the pocket-book.

And why can’t Putin be corrupt too, and do like Hitler, and invade countries? Who is going to stop him? Corrupt plutocrats, his friends and mentors? This is exactly what made Hitler laugh, literally laugh, even using the word “plutocrat” between two bouts of laughter. It did not end up well. The plutocrats had the last laugh: playing with Hades, Pluto, Satan, one can get burned to a crisp.

(In his last few days, Hitler ordered the execution of Dr. Schacht, JP Morgan’s creature, who had done so much to put the Fuhrer in power; ironically Schacht was saved because he was going to be executed with Leon Blum, the Jewish French socialist PM: a Wehrmacht aristocratic officer berated the SS at the last moment).

Plutocrats are playing similar games nowadays. The West is supporting the Saudis plutocrats, who, at best, are bandits who ought to be jailed, and then judged. However Saudi princes would point out, they don’t see why they should go to jail if the big bankers don’t. Good point. We may as well  appoint the Saudi gangsters to head the panel which decides who shall be an expert for the Human Right Council at the United Nations.

So now the Saudi torturers, who allegedly decapitate more people than the so-called Islamist State, want to execute and crucify a teenager who heaped disrespect on them. Until his flesh falls off onto the ground in a rotten heap. Why not? After all, he is a Shia, a type of apostate Muslim as far as the Wahhabists are concerned. That he is the nephew of a major opponent is also as good a motive as any.

George W. Bush seems to have committed, in Iraq, a war of aggression. At least he was told some judges in European countries think so, and are ready to have him arrested. Thus Bush does not travel there.

At the Nuremberg’s trial, some Nazi leaders were condemned to hang until dead, just for having committed a war of aggression. Why can’t we keep on applying international jurisprudence?

In August 1924, the German imperial government attacked the world. The leaders were not hanged, as they should have been, in 1919. So the mood of aggression against the world was repeated in the years leading to the 1939 war declaration of the French Republic against the “guide” Hitler. What did the German leaders risk? They thought they were not personally at risk. They found otherwise in 1945.

Now, of course, the moral fiber was stronger in republics in the past. In August 1914, the French Republic welcomed, as war refugees, one and a half million foreigners (1.5 x 10^6). In two weeks.

Now we just have austerity, meaning that the have-nots are viewed as still having too much. Plenty of austerity, and no humanity: ce sont des mots qui vont tres bien ensemble.

Patrice Ayme’

Wisdom Not An Itch, But Economy Hitching Dark Side, A Gangrene

September 13, 2015

Is Philosophy Just An Itch? Far from it. Even if it were, as Wittgenstein had it:

“Philosophy hasn’t made any progress? – If somebody scratches the spot where he has an itch, do we have to see some progress? Isn’t genuine scratching otherwise, or genuine itching? And can’t this reaction to an irritation continue in the same way for a long time before a cure for the itching is discovered?”

It is not true that philosophy asks always only the same questions, and it is not true that philosophy has not progressed in 3,000 years.

Instead the opposite is true. contemporary with Socrates was Xenophon, who named and defined “Economics”. Xenophon was student and friend to Socrates, a writer, historian, soldier, general, and retired as a horse breeder.

Krugman Is A Philosopher, He Rules World. But Who Pulls His Strings?

Krugman Is A Philosopher, He Rules World. But Who Pulls His Strings?

[Paul Krugman, appropriately surrounded by the Dark Sides.]

Paul Krugman is one of the world’s most respected – and most feared – economists of our time. Illustration by David Simmonds.” –Handelsblatt which adds: “Many think the U.S. Nobel Prize winner is the most influential economist of our time and a leading voice on the left. But many of his major ideas are controversial. And rightly so.”

Those familiar with my disagreements with Krugman know that we differ philosophically. Our differences are mostly about finance, banking… And especially believing that, if only bankers had even more money, through Quantitative Easing, the world would become richer, fairer, and more comfortable. That is anathema to me, for many reasons, including the fact I do not trust too much power in too few hands, whatever the reasons evoked, or even if one calls these people, bankers, and Obama admires them very much.

Philosophy named and defined much progress.

Behind all and any empire is an economic organization backed up by a philosophy. Darius, founder of the Achaemenid Persian empire, changed economic organizations very quickly, according to circumstances, , from military to command and control, to building the world’s first fast road system, to libertarian capitalism.

It is possible to argue that the Greco-Roman empire failed, because it failed PHILOSOPHICALLY. Namely, its philosophy failed. It failed because the (Macedonian) military leaders got imprinted on the erroneous, despicable, and lethal philosophy of their friend Aristotle, itself all too inspired by Plato, Socrates, and other golden youth, or their fellow travellers.

One can view the Middle Ages greatly as a struggle against much of Aristotelian philosophy: not just against Aristotle’s physics, which was egregiously wrong, but also against his Ethics and his, related, preferred theory of government. Aristotle embraced dictatorship, also known as monarchy, hence theocracy.

In Socrates’ times, democratic institutions were, in many ways, brutally primitive and inappropriate for sustaining the Athenian Republic. These brought not just the death of Socrates, but were decisive to bring the defeat of Athens in the Peloponnesian war (which nearly brought the annihilation of Athens, and certainly an eclipse of democracy for more than 2,000 years). The People’s Assembly had decided to massacre entire populations (Melos), and brought hatred against Athens.

Much of Socrates’ work was about improving the Athenian democracy, and many of the philosopher’s critiques were addressed during the Middle Ages, by inventing new institutions.

So there has been progress in philosophy, and also considerable social and political progress in implementing progress in wisdom.

We need more. Behind Krugman’s vision of the world, lays a benign, naive trust in human beings benevolence. At least, that’s the excuse.

Friends, Not To Say Lovers Of The Same Values. How Far Are We?

Friends, Not To Say Lovers Of The Same Values. How Far Are We?

Instead, I go further than “French Theory“. French Theory, generalizing Nietzsche’s approach, is suspicious of all and any institutions. I propose to remember what the Marquis De Sade implicitly proposed: those who take, those who are entitled, those end up being able to take decisions on behalf of the many, are, intrinsically, moved by the Darkest Side. Even if they did not start this way, the stress they are subjected to, insures that they end up that way.

Yes, Krugman is a philosopher, in the sense that his work, and advice, and popularity among, thus, power on, the mighty, depends upon his philosophical positions. Yet philosophers to the Dark Side, by their very presence where they are, embrace it.

This is not all just words. I love and respect Paul Krugman. in some ways. However, contemplate this: “Enron, a notorious corporation which conspired in organizing energy shortages in California, later to collapse in scandal and bankruptcy, employed Krugman. Paul’s fee? $37,000 for three days work. It provoked outrage. Wasn’t this excessive?. Mr. Krugman used his column to respond: not at all, he wrote. At the time his fee for a one-hour talk was $20,000. Enron got a deal.”

And the worst? Paul Krugman is very small fry, in the plutocratic world, as far as income is concerned. Donald Trump recently pointed out he “knew hedge fund managers. They pay no tax.” And some of those earn billions. General Electric got (60) billion dollars from the Obama administration, paid no tax for years, and then proceed to buy its French competitor, Alstom. Even the European Commission found that not kosher (although the plausibly secretly compensated by huff and fluff ,French government had approved).

Krugman at some point proclaimed himself the “lonely voice of truth in a sea of corruption”. The worst? It’s true. Because Krugman had dared to say the Obama administration was soft on punishing Wall Street after the 2008 corruption affair (the so-called “crash”), he was not invited to participate in said administration of the useless and redundant (as plutocrats connected to the so-called “Deep State” take all the decisions).

Handelsblatt: “Somehow Mr. Krugman’s fury keeps on growing. The source of this anger may be the man’s greatest enigma, since in fact worldwide there has never been as much Keynesian intervention as there is today…”

The answer to this, Handelsblatt, is simple: the crisis is getting ever worse. To the point the spectrum of war is rising. Even the Pope, noticed this.

Handelsblatt: “Since the crisis began, the largest central banks have flooded the world economy with liquidity, and brought their base rates close to zero. The governments of the industrialized world, with the exception of Germany, are still running huge budget deficits. They have put together enormous rescue packages, partly to rescue the banks, partly to bail out bankrupt states, partly to invest in infrastructure.”

Well, and this is my main difference with Krugman, rescue packages were all about the (“PRIVATE”) banks, and they bankrupt(ed) the states. To correct this, the entire banking system needs to be completely overhauled. In first approximation, the spirit of the reforms of president Roosevelt, ought to be re-introduced.

In Great Britain Jeremy Corbin, an anti-dictatorial (anti-monarchist) was elected to head Labor. Tony Blair, one of the world’s most corrupt politicians, ever (Bliar gets money from various dictator, including that of Kazakhstan) suggested that: “those who say their hearts are with leftwinger Jeremy Corbyn should ‘get a transplant’.

Darius, like the Incas, like Diocletian’s Rome, or the Tang in China, or the empire of the Franks (which mutated into the “West”), or Themistocles Athens, let alone Stalin’s USSR, or today’s China, let alone the mercantilist USA, show that the primary actor, and author, of the economy is not the little capitalist, but the massive state. Handelsblatt claims not to understand this, and calls Krugman a fool.

However, the USA’s government institution revealingly known as the “Fed”, created more than 13 trillions (yes, that’s a t: trillion) dollars of money to inject in the economy, and the European Union, less than two trillion. And yes, that’s a problem: too much money chasing too few investment possibilities. So what ought government to do? Create more investment possibilities. Titanic investment program. As Darius did with his Royal road network. Now the Royal Road ought to lead to Mars. And the Quantum Computer. And Thermonuclear Fusion. And the Space Elevator. And a research program to fight aging (a major economic, not just military problem). Those who don’t want progress get regress, not to say egress.

Imagination, ladies and gentlemen, is more important than austerity, and not just in economics.

Patrice Ayme’


July 4, 2015

The Champagne region was proclaimed a world heritage site by UNESCO today. Champagne, a method to make sparkling wine, was created by a cleric, Dom Perignon, four centuries ago.

Mr. Yannis Varoufakis, Greek finance minister: “Why did they force us to close the banks? To instil fear in people. And spreading fear is called terrorism.” Indeed. That is what I was saying before: arguably the demons of High Finance, the shills of the IMF, Goldman-Sachs, the ECB, etc, are the main force deep behind Islamist Terrorism, because they cause misery, while weakening enormously the military capabilities.

Added Varoufakis:”The EU will have no legal grounds to throw Greece out of the euro, and then the real negotiation will start with creditors.”

Unbelievably, the European Central Bank has put the entire Greek economy in a deep freeze, with a very low ceiling on the Emergency Loan Agreement (ELA). What for exactly? With which authority? Just because its (ex) Goldman-Sachs head, Draghi, is used to make a profession from dragging people in misery?

Bait & Switch, Or How The Public Was Made To Pay For Being Ruled By Banksters

Bait & Switch, Or How The Public Was Made To Pay For Being Ruled By Banksters

Look at these numbers above: how come France, Germany, Italy, etc. invested in Greece? Of course they did not. What they did is that they “lent” Greece money so that the Greek plutocrats then in command of Greece could refloat the French, German, etc. bank subsidiaries which had gone bankrupt lending to fellow plutocrats they had met earlier, taking champagne baths, all together. Now we are supposed to drain the bath, and serve them more champagne.

Meanwhile, Christine Lagarde, the Marie-Antoinette who proposed that, because gasoline was to expensive for them, the French ought to switch to biking, hangs tough about “Greece”. A buffoon shilling for plutocracy with a misleading French accent. Just look at her shifty eyes: she knows how dirty she is.

As Oxford economy professor Simon Wren-Lewis puts it, the IMF was “captured” by the banksters: “the Troika made a huge mistake in using their citizens’ money to lend to Greece so Greece could partially repay these private sector creditors – that is where most of the Troika’s rescue package went.”

(Yes, apparently, 92% went to banksters; but thanks to propaganda, most people believe We The People of Greece splurged, whereas, it is the banksters who splurged).

The first order of plutocracy, nowadays is banksterocracy: bankster-power. Let me quote extensively from Atrios, a USA citizen originally from Australia, with a PhD in economics. Atrios writes a wildly successful blog, taken seriously by major economists. Quoting others extensively, Atrios comes below to the conclusion I reached more than six years ago, about the nature of who rule us, and this is most pleasing:

“Saturday July 4, 2015: What’s It All About Then

Greece’s Euro “membership” isn’t about using the currency, it’s about having access to various loan facilities and support from the ECB, which it already doesn’t have.

Bloomberg reports that Bulgaria, which is not a Euro member but backs its currency with Euro reserves, has just been allowed to borrow from the ECB at the same rate as Euro members, thus enabling it to firewall its banks from Greek contagion. This is a privilege normally only accorded to Euro members – and it has been WITHDRAWN from Greece. If this is true, then Bulgaria (non-Euro member) can obtain Euros from the ECB while Greece (Euro member) cannot. It is hard to see what benefit Greece’s Euro membership confers, apart from redistribution of seigniorage receipts.

And finally someone gets the logical endpoint of central bank “independence.”

For the central bank of a currency union to deliberately restrict the money supply in regions within the currency union is bizarre. No other currency union central bank on earth does this. It would, for example, be unthinkable for the Bank of England to deny liquidity to Scotland’s banks. But the ECB has denied liquidity to Greece’s banks, not because they are insolvent (which is a reasonable reason to deny liquidity to banks) but because the sovereign won’t toe the fiscal line. It has taken on a political role that it should not have.

Of course, the ECB’s shareholders are the member state governments. But those governments have bound themselves by laws and treaties that prevent them interfering with or in any way controlling the ECB. So the Eurozone is in reality a financial dictatorship run by bankers. I struggle to see why anyone would voluntarily join it, let alone want to stay in it. But that’s democracy for you.

Whatever it is, it ain’t democracy. It’s banksterocracy. The concept of central bank independence was, once upon a time, thought to be necessary to prevent irresponsible governments from doing, or being perceived as doing, irresponsible things with the money supply. Now the point of central bank independence is to hand immense power to a bunch of unelected unaccountable people engaged in revolving door careers with the banking system. Let’s continue laughing at the silly Greeks and their silly corruption.  

The first irresponsible thing to do with the money supply is not to provide enough money to run the economy. This was a major problem during the Roman empire’s Fourth Century (due to a dearth of precious metals and not enough police powers to insure the value of the Fiat Currency). By 300 CE, the imperial government instated a massive command and control system to insure the core functions of the economy.

The problem we have now is different: so-called austerity is actually a refusal to finance important sectors of the economy, including not just basic decency, but also science and education. Meanwhile China has boosted its science budget to a nearly incomprehensible 192 billion dollars (more than all the West combined).

China is right. 100%. (Then the land of Confucius gets accused of “ethical breaches”, by professional bleaters, for pulling ahead on genomic research)

On the other hand, those who have starved, and are starving the European economy, from sheer lack of currency, are not just betraying their birthplace, but civilization itself.

Patrice Ayme’


FIFA Under The Law, USA Banks Above The Law

May 28, 2015

Yesterday the French amused us by celebrating four resistance fighters (out of hundreds of thousands), two of whom (the ladies) were rather advantaged right from the start (and did not do much). Today the humor comes from the USA, which has decided to crack down on soccer. More exactly, FIFA: Fédération Internationale de Football Association. It’s easier to crack down on soccer rather than American football, as the USA are not too good with the former. Moreover, FIFA is a French acronym…

But the irony is not there, the irony is that High Finance steals trillions, while fossil fuels enjoy 5.3 trillion dollars of subsidies (says the IMF), much of it lost in corruption (casual observation).

Putin: [FIFA Scandal] Yet Another Attempt By The USA To Extent Its Jurisdiction To Other States

Putin: [FIFA Scandal] Yet Another Attempt By The USA To Extent Its Jurisdiction To Other States

And what does the USA do? Arrest FIFA officials. Seven senior FIFA officials were arrested at a luxury hotel in Zurich, at the behest of US authorities who are conducting a massive investigation into corruption at football’s governing body. Seven more charged in the USA.

FIFA’s profits last year were 3.3 billion dollars, slightly more profit than the French oil giant TOTAL (one of the five Big Oil oil companies). TOTAL has 100, 000 employees. TOTAL has hundreds of subsidiaries (some part of an effort to pay fewer taxes, something TOTAL said it will change). FIFA has 1,400 employees. So one can say that FIFA’s profits, per employee, is about 70 times those of TOTAL.

The punchline? FIFA, based in Zurich, Switzerland, is registered as a non-profit, of sorts, and pays no Swiss Federal taxes.

This sounds silly, but one has to understand that the world’s plutocracy rests on similar tricks. In the case of FIFA, it’s comical: for years one knew that money was given by nations to get the soccer world cup. For the 1998 cup (won by France), the finalists were France and … Morocco. France got 12 votes, Morocco 7. It was just revealed the Moroccan votes were bought (big surprise!).

The way FIFA is corrupt is typical of the way most international organizations are corrupt:

1) A few officials vote (same story in Brussels, Washington, Moscow, Beijing, etc.), while they supposedly represent the world.

2) All “countries” get an equal weight (209 of them in the case of FIFA, appreciably more than in the UN). So a tiny Caribbean island nobody has ever heard of, but for a few plutocrats, gets the same vote as, say, Brazil, or Germany (total population nearly 300 million).

Once again, in the case of FIFA, it’s comical: FIFA revenue is of the order of five billion dollars. The world’s real economy GDP is around 10,000 times more. However, counting financial derivatives, the world real and imaginary GDP rises another eight times, or so.

And there, the conspiracy factor is much higher. Let me explain.

FIFA’s corruption indeed, is for all to see. Everybody knew that Qatar had bought its world cup selection: clearly only “officials” who were bought could agree to have players playing in 50 Degrees Celsius (in the shade) heat (that’s 122 Fahrenheit, temperatures seen in India this week, courtesy of the fossil fuel industry).

The High Finance industry is hidden in plain sight. But well hidden: the famous 99.9% understand nothing to the public-private fractional reserve banking system, so they can be rolled in flour every day, and then fried, just so. In a way, there is justice; the stupidity of the 99.9% gets punished by the malignant growth of plutocracy, mightily fed by the fact that big bankers are actually corrupt government officials.

That bankers are corrupt, many understand. That bankers are also unsupervised government officials, very few understand. Plutocrats, though, understand this perfectly well.

More generally most plutocrats, and plutocratic organizations, have to do with being on the good side, or in a conspiracy, with government. Most of these conspiracies are intricate enough for common people not to perceive them (an example is the F35 “strike” plane, the most expensive military program, ever, in all of history: 400 billions spent so far, and counting… for an ineffectual plane which will need several more years, just to fire its gun).

So the FIFA scandal, for all to see, is excellent, if one looks at it as a toy example of a much more general problem. However, if it the only thing people worry about, and, somehow, leaves the impression that justice, police and the law are prevailing, worldwide, it will have a nefarious effect.

Why is FIFA’s corruption a toy? Because it involves a few hundreds of million dollars. A particular example is FIFA in Brazil: companies such as Nike paid a hundred million dollars or so, to organize the world cup in Brazil: that was “legal” (it should not be legal, but that’s another matter). Then 70 million dollars were paid below the table. This is what the “authorities” in the USA are in a huff about. This is what they call “corruption”.

Why? Because corruption, in the USA, is above the table: everybody can see the hyper wealthy buying the president in the USA. It’s glorious, it’s all over the media. If you have 200,000 dollars to waste, the president of the USA will go on his knees, and eat crumbs in your hands, such is the nature of the beast.

So how did the banks’ corruption cost? Just for the 2008 crisis? Well just look at the total cost of the “Quantitative Easing“. That’s at least ten trillion dollars (8 in the USA, around 2 in the EU). Even if one upper bounds the FIFA corruption at one billion, this means the High Finance corruption scandal was at least 10,000 times greater.  And differently from FIFA the worst part is orders of magnitude greater than that, as it consists in the hundreds of trillions banks diverted in financial derivatives.

If one views the latter, as one should, as the largest corruption, the greatest theft ever, in the history of humanity, one ends up with the astounding realization that banks have stolen for at least ONE MILLION TIMES MORE money than the FIFA has moved under the tables.

The BBC (Canada) itself is wondering: America does not even like football… Why is it leading the charge against alleged Fifa corruption?”

FBI Director James Comey set out why the US was able to act:

“If you touch our shores with your corrupt enterprise, whether that is through meetings or through using our world class financial system, you will be held accountable for that corruption…”

The USA is of course “world class”, or even of a class of its own in the world. Especially as far as considering taking orders from plutocrats, others for idiots, and playing holier-than-thou, with the aim of pleasing the banksters. Question: how does Mr. FBI thinks drug trafficking works?

Answer: citizens of the USA spend fortunes on illegal drugs coming from Mexico and the like, so they can forget the sorry world class parody of democracy they live in. Once the drug sellers have pocketed the money, in the world class USA, how do they get it to South and Central America? Through world class banks, of course. American banks. Big banks of the good old USA. Why does not Mr. FBI think about that? Won’t advance his career? I guess not. It’s not “world class” to suspect your masters.

“Nobody is above or beyond the law,” FBI Director Comey said. “We will not stop until we send messages that this is not the way things should be and that they must be different”.

Kabuki theater, on a world scale.

Even Vlad Putin has noticed: “This is yet another blatant attempt (by the United States) to extend its jurisdiction to other states.”

It’s irritating to see Putin marking points. Yes, nobody is above the law. However, the USA itself is above the law, indeed. As Big Banks of the USA are part of this general enterprise, the USA, when they launder money for drug traffickers, they get a slap on the wrist, a little fine (paid by Quantitative Easing, that is, the We The People of the USA themselves).

The USA above the law? Why else the USA does not recognize, and is not part of the International Criminal Court? Simply because many of its top officials would see warrants of arrest against them (starting with those who launched wars of aggression). Instead, what we have now, is tiny Switzerland, anxious to please its masters in Washington and New York, by arresting whoever those capitals (of USA and High Finance, respectively) have decided to arrest.

The considerable attention given to this FIFA scandal is yet another maneuver to focus the attention of We The People on something shiny which moves, on vaguely alien culprits. It is reminiscent of those two low level traders who were prosecuted for the 2008 crisis: one in New York City, one in France. Yes, they were both French. What works best is what is straight out of central casting.

As usual, American “justice” will employ a very corrupt method: make a deal with some “culprits”, such as this Swiss banker who went to jail, in the USA, but then was given around 100 million dollars, by the USA, for having said, for all to hear, what the USA wanted him to say. What kind of “justice” is that? The justice of corruption? But then if justice is corrupt in the name of corruption, where is the real justice located, and what is it?

Patrice Ayme’

Bank Worship

May 20, 2015


I have fiercely condemned, for a decade, the policy of reducing the economy to interest rates. As I have said, and will say again below, this is identical to making (private) bankers into gods. “Liberal” (meaning “left” in the USA) economists love to say that low interest rates is all the socialism we need. Nobel laureate Paul Krugman is trying to make fun of the serious arguments found in scholarly critique of his “interest rate idolatry”. Says Paul:

I’m With Stupid.

No doubt, dear Paul, no doubt. Being stupid is more profitable, quite often, than being smart and moral.

Banksters Steal The World, And Prosper, Ever More

Banksters Steal The World, And Prosper, Ever More

Via FT Alphaville, James Montier has an interesting piece castigating economists for their “interest rate idolatry”, their belief that central bank-set interest rates matter a lot for the economy…” Montier writes down notions I used to brandish at the beginning of the Obama presidency. I stopped after I realized everybody (Very Serious People, Academia, High Finance, Politicians, Media) was on the con. That meant, in practice that, if one talked about it too much one was viewed as mentally imbalanced (just as pointing out that the Qur’an prescribes terrorism may one looks as a racist, according to the Politically Correct insects). Here is part of Montier’s well-thought essay:

A wider idolatry: the greatest con ever perpetuated

Lest you think I am being unduly harsh on the world’s poor central bankers, let me turn to the wider idolatry of interest rates that seems to characterise the world in which we live. There seems to be a perception that central bankers are gods (or at the very least minor deities in some twisted economic pantheon). Coupled with this deification of central bankers is a faith that interest rates are a panacea.

Whatever the problem, interest rates can solve it. Inflation too high, simply raise interest rates. Economy too weak, then lower interest rates. A bubble bursts, then slash interest rates, etc., etc. John Kenneth Galbraith poetically described this belief as “…our most prestigious form of fraud, our most elegant escape from reality… The difficulty is that this highly plausible, wholly agreeable process exists only in well-established economic belief and not in real life.”

This obsession with interest rates as a cure-all rests on some dubious views about the way the world works.”

Montier points out that the fundamental official argument for lowering interest rates down to zero is flawed: …”firms generally rely on internal financing to fund investment, rather than borrowing – witness Exhibit 6. Over 100% of gross investment is financed by internal funds.”

The obsession with interest rates has meant, in practice, that so-called liberal, self-described “progressive”, friends of “We The People” economists, have prescribed, implicitly, to lower taxes on the hyper-rich as much as possible. So they masquerade as left-wing, but, in truth, they are plutophiles. This is an old method, and why Polar Bears are white, instead of brown or black as their ancestors were. Montier:

“Just in case you were wondering about the much-lauded ability of the central bank to create inflation via helicopter drops of cash (or its modern-day equivalent), this is actually a form of fiscal policy, not monetary policy. As I noted above, monetary policy alters the distribution of net worth while fiscal policy alters the levels of net worth. Because helicopter drops effectively give everyone a boost of cash, this is clearly a change in net worth and thus is likely to be helpful in stimulating demand.

As you may have gathered from the preceding paragraph, the good news is that there is an alternative to monetary policy, and that is fiscal policy. These days fiscal policy is deeply out of vogue amongst policymakers and politicians. However, it has a much more direct link to growth than any of the channels suggested for monetary policy – it is part of the construction of GDP, and has a clear impact upon incomes.”

Krugman made a very feeble defense, which mostly consisted, weirdly, but tellingly enough, to laud Lawrence Summers, one of the architect of the dismantlement of the financial regulations under Clinton, to create a class of hyper-rich financiers. To his credit, Krugman published my comment:

In the USA, houses are started massively all the times. It’s a mark of unsustainability (presumably flimsy housing is replaced). Reducing the entire economy to this, is imbalanced. Why not consider infrastructure starts? Research? Health?

The fundamental question is: what is an economic activity which is profitable for the society?

The conventional answer is that banks know best. As the banks’ lending goes up as interest rates go down, bringing the latter down, improves the economy, say banks’ friends.

Let’s call that BANK WORSHIP.

Bank worship has enabled big banks’ heads and associated high financiers they collaborate with, to be so powerful and dishonest, that they changed the hearts & minds of all the power that be in society.

The latest case is the French Societe Generale: the police chief in charge of an inquiry on an eight billion dollar fraud therein, now admits, years later, that she was manipulated by the bank (a lower level employee, Jerome Kerviel, was sued, chased down, and condemned severely, although he claims he acted under orders). The fraud was reimbursed by taxpayers. This means that Societe Generale bosses, just in this particular case, of this particular fraud, stole around 50 dollars to each French citizens. Don’t worry for them: the thieves live big. An even bigger picture is that, in the leading countries, big bankers are banksters, and they corrupted institutions of the Republic (including politics, government, justice and police) thoroughly.

The problem is the same in Anglo-America: time after time, giant frauds of the biggest banks are exposed, and they are condemned to fines. In the end, a bank-too-big-to-fail condemned to a fine means nothing: in the worst possible cases, it’s tax payers who pay. It is the case where the criminals’ punishment is to make the victims suffer.

The latest such case is the LIBOR “punishment”, proclaimed today. In it, big banks in London manipulated the world’s leading interest rate (they call that the “market”). You would think that, after stealing billions the heads of banks such as JP Morgan would go to jail. No. Taxpayers go to jail.

Zero Interest Rates, To Serve High Finance Plutocracy:

Another problem is that zero interest rates have proven devastating for small savers, while providing the banks and their accomplices with quasi-unlimited funds for playing with each other the derivatives’ market, something that is not a real economic activity, except by making the richest ever richer.

One lends to the rich. By making lending ever easier, government policy has made the rich ever richer.

Correct economic activity would consist in the government encouraging activities which are profitable to the people at large, very long term.

The “market” is driven with what bankers think is profitable, short term.

Conventional wisdom by the economists in power is that we can trust the bankers to encourage the economic activity most suitable to the “market”, hence society.

Governments were told by the economists in power to make the job of bankers easier, to make for a better economy, hence better society. Trust bankers, give them all the lending capability, hence all the power they want, and We The People will become richer.

Thus the general strategy of bank worship assumes a trait that is true: a banker is a government official. A banker is a non-elected, uncontrolled government official, with unlimited funds, and inexistent oversight by the People’s representatives.

Bankers control the market, which controls the economy, which control society. Is that the society we want? Do we want to be controlled, financed, by an oligarchy of non-elected little Big Brothers who decide what activities the society will engage in?

Bankers are little Big Brothers who are free to finance the high financial class they belong to, as much as they want. That’s why derivative trading is more than ten times larger than real trade, worldwide. This is also why half of the world’s money is in Dark Pools. And so on.

The cause of this nightmarish world is bank worship. Bank worship is very smart for the Big Bankers. Krugman is NOT with stupid, as he disingenuously claim. He is with the winning crowd. To go interact with people such as Paul Krugman and Joe Stiglitz, the fact is, one needs to be seriously independently wealthy (then one can become a “student”, meaning a future co-conspirator, or mingle at parties).

It is very stupid for the rest of us to have become adulators of bank worship. Bank worship made society subject to a dictatorial oligarchy operating in the shadows.

What happened to the Enlightenment? It seems to have sunk in “Dark Pools”.

Patrice Ayme’

Picking Piketty Peeks

February 13, 2015

Thomas Piketty, a young and successful French Science Po economist wrote “Capitalism in The XXI Century”. I bought it ASAP, and then did not read one page. The reason is that there was a waiting list. By the time I got the book, it was clear it was rehashing part of what I have been saying for years.

For example, to my knowledge, I was the first to make the rapprochement between the present situation and the Ancient Regime. The Nobles (2% of the population) did not pay (most) tax.

Piketty recognizes that he just discovered “his book’s principal idea” that the “taux de rendement du capital” (return on capital) was higher than return on work. “Moi je ne le savais pas avant”. I have been pounding that fact for a decade or so.

The Higher The Return On Capital, The Lower the Growth (Piketty)

The Higher The Return On Capital, The Lower the Growth (Piketty)

It is nice to see Piketty saying these things I have been saying, now, but I have moved on, long ago. I condemn the very way money is generated (by the private-public banking system).

It is first obvious to whoever has studied past societies. Plutocracies are basically those societies where, at some point, taxation on the wealthiest has not been applied enough to limit the EXPONENTIATION of capital.

I do not find alluring to listen to my old observations. Not to demean Piketty. Others such as Saez in Berkeley, also French, had published enlightening research on inequality, for years.

I agree with all what Piketty proposes. Yet, many of his answers are all too mild.

In the period from Roosevelt to1981 (arrival of Reagan), the upper marginal tax rate of the USA averaged 82%. It applied above one million dollar income (constant dollars). Growth was maximum.

What Piketty did not say: In the next 20 years the maximum margin on the richest came down to (less than) 15%. Yes, less than secretaries.

Piketty wants to rise the upper margin tax rate of income millionaires to 80% or 90%. I agree.

To this critics of Piketty, in France or the USA, reply that will kill innovation. A French cutie interviewer told Piketty that with rates like that the robot who heads Facebook (OK, she did not use “robot”) would not have been motivated to invent Facebook.

Who cares?

As it is, Mr. Z from Facebook stole an idea from France. Besides, Facebook-like companies already existed (Myspace). There is also plenty of evidence Facebook was a government operation (the protégé of Larry Summers, parachuted to the USA government under Clinton, was parachuted to Google, and then parachuted to Facebook).

Piketty vaguely mumbled something about the research which really mattered was public. But he was weak and indecisive.

Why? Well, after all, Piketty teaches at Science Po, a place full of young arrogant greedsters who think they are becoming qualified to lead the world. They live according to a principle that Piketty himself condemns: politics as a profession. Piketty said that the fact Hollande had been in politics all his life was a problem (the same is true for roughly all politicians).

Professional politicians should not be condemned to clean the toilets exclusively, but certainly ought to be left to sort out the details, of the laws passed by the People, like they increasingly have to, in Switzerland. That’s the only exclusivity they should pretend to.

In truth, business creators are nothing much. Business creators motivated first by money are even less.

Piketty to Bill Gates: ‘If 30 years ago, one would have told you: you will earn one billion dollars, not 50 billion, would you have refused to invent Windows?’ Of course not says Piketty, answering his own question.

Piketty: Without counting that all these innovations rest on an ecosystem of public research.

Piketty missed the obvious remark that France was at the forefront of the electronics age: transistors and CPUs (chips), and even the Personal Computer (PC), were all invented, and produced first in France. He probably does not even know this.

And the fact he does not know is testimony enough to the dirty ways of money.

The hard creative work is from engineers, scientists and the philosophers who back them up, not forgetting the historians, sociologists, writers, artists and poets helping to inspire the preceding crowd.

All the world of lasers and the like came from publicly funded lab in Paris. In 1953, Kastler invented optical pumping:

The same lab has made more Nobel prize winning work founding outright a completely new field: how to see light with atoms (my own formulation, don’t accuse Serge Haroche!)

Such labs are now starved by austerity.

If you ask people at Apple Inc. why they are so good, they don’t say “Steve Jobs”. It’s not just that Steve has experienced technical difficulties, it’s that Apple engineers feel empowered. Apple has $700 billion in market cap (twice Google).

After a level of inequality, it has no effect on the motivation of individuals: why to pay traders millions of Euros? Say Piketty.

What I say is that much of trading itself, should not exist.

Much of what Piketty says about Europe and the Euro Zone is correct. One should homogenize the core part of the Euro Zone, and those who don’t like it, like Luxembourg, can stay out.

Right now in Europe, large companies pay less tax than medium and small ones. It’s even worse with middle class people versus the wealthiest.

A point Piketty makes is that inequality is not everything, but opacity also matters. He mentioned that Carlos Slims (world’s richest man) obtained juicy contracts from the government. (Piketty is careful not to say that this was a case of obvious corruption; he obviously knows this, but he wants to be keep on being invited in the power circles, and his books to create the buzz that brings millions of sales).

An objection made to Piketty is that the classification of the richest people has changed over 30 years. To this, Piketty has not clear retort, but I do.

That is indeed a silly objection: The founder of Walmart passed away. His heir have, all together, more money than Bill Gates.

More historically, under the terrible Roman plutocracy, the richest of the rich changed all the time, for similar reasons. But, although it was hard to maintain just as high a status, it was easier to maintain one just below. The Curial class (= local plutocracy) survived for 4 centuries.

Karl Marx? Piketty rightly points out that Marx wanted to cancel private property, but did not think about what would happen the next day.

Piketty suggests to create new notions of property, including hybrids between public and private property as conceived now.

Piketty was asked why he was so keen, him, such a young guy, to go all around the world, to be received by Obama, to be admired by all, etc. … Instead of being working hard? Especially with the crisis we have now?

Piketty replied he believed in the power of ideas. He believes politicians are just into doing what they believe is the dominant thinking We The People (he did not use that expression) go by. So, in the democratic debate, one should try to modify this dominant opinion.

Notice the naivety: one is very far here from my Satanic interpretation of common human behavior, especially at the leadership level

The answer to this is simple: some play, some think. Real thinkers are not in the White House, they are in distant caves, watching the sea. Occasionally, when not thinking deep.

Piketty points out that oligarchic regimes bring social problems, thus scapegoats, thus nationalist drift, and then, ultimately, like Hitler, or Putin, war.

All right, truth be told, Piketty did not mention Hitler, but he did mention Putin. Not a word on the problem of banks. Out of 29 extremely dangerous banks, the equivalent of potential super-novas on the verge of explosion, four are French. BNP is roughly the same size as French GDP. Those banks are the main engines of inequality, besides the fact any of them, by imploding would make the situation instantaneously worse than in 2008.

Those banks are still allowed to engage in a form of trading which is the modern equivalent of slavery. Piketty does not mention the problem, which is at the core of the money generating-austerity craze.

And he is not afraid to say that many of the time honored ways of economics are actually outright insanity (he repeatedly uses the word “delirium”). Piketty is no genius, but he makes an excellent impresario.

Patrice Ayme’

Too Little Debt & Too Much Blood Money Kill

February 9, 2015

Dying Of Too Little Debt, and Too Much Institutionalized Crime:

Nobody Understands Debt” says Paul Krugman, and he demonstrates it in an excellent editorial. I am happy that he is finally getting black on white, what I wrote long ago. He does not put it as spectacularly as I have: at worst, debt becomes tax.

From Krugman’s description Dr. Merkel comes out as a complete fool (so it is not reassuring that she goes around the world that the Ukrainian Republic should not be sold lethal defense weapons: is she Putin’s agent?). Krugman concludes: “…if the euro does fail, here’s what should be written on its tombstone: “Died of a bad analogy.

The world economy can die of other things too, such as massive corruption under the increasing weight of global plutocracy.

The presence of more than 30,000 known tax evaders in just one subsidiary of the British bank HSBC in Switzerland alone, between 2005 and 2007, has been revealed today. The total amount of tax evasion is 180 billion euros (200 billion dollars; lower numbers were initially announce, in good disinformation style). The accounts tied to politicians, royalty, designers, sports figures, corrupt businessmen, dictators, arms industry officials, drug traffickers, and high-end criminals.

The bank actively helped customers conceal the accounts from authorities. The bank also provided customers with cash under the form of bundles of old bank notes, in various currencies so they couldn’t be traced. Organized crime, also known as banking, is in charge of creating money… as debt. (97% of money is created by banks as credit, worldwide.)

The data was “illegally” downloaded by bank employee Herve’ Falciani, who later fled to France. Falciani told CBS’s 60 Minutes Sunday night that colleagues at the bank helped him with the data.

“Friends — let’s say partners — gave me these data,” Falciani says. “I’m not the only person in banking system that wants to raise alarm.”

60 Minutes made a biased report, insisting on Falciani wearing disguises, etc. Falciani was in jail in Spain (because of an Interpol warrant for his arrest launched by Switzerland, at the British bank’s prodding) for 5 months. During that time, Spanish authorities, fearing for his life, let him appear only under a heavy disguise (“60 Minutes” did not mention that the authorities disguised him; instead, “60 Minutes” insisted that Falciani wearing a disguise reflected the general mental derangement “60 Minutes” was anxious to impart to its viewership that Falciani was suffering from! Of such little details good propaganda is made of). Falciani has now police protection in France (and I would suggest that France sends warrant of arrest against various Swiss “authorities” instead; actually what about Putin’s 40 billions residing in Switzerland…).

Many heads of states were involved in HSBC Switzerland, including the King of Morocco, who had 8 million dollars on one account alone at HSBC Suisse. Ironically enough, Moroccan law forbids foreign bank accounts. The King of Jordan had 41 million in one account.

Also several dozen major Arab plutocrats owned accounts obviously set-up to feed Bin Laden’s Al Qaeda. Terrorism can be so expensive nowadays… Plenty of accounts of HSBC could be traced to blood money.

The brother in law of the Tunisian dictator Ben Ali. Family members of the Syrian blood bathing dictator, Assad. A major woman politician from Burundi. Money from major drug traffickers, being laundered.

HSBC says that it did not know. That’s a lie: the bank called all the owners of the accounts exposed to politics “PEP” (“Politically Exposed People”).

Why don’t banksters go to prison? Say, for decades. Why, instead of asking the Greek people to pay for bankers, we don’t systematically recover all the properties of all the officers, and shareholders of all the banks which lent to Greek plutocrats? One should also expropriate said plutocrats. Let’s do it, and see what’s left… If anything.

Here is Krugman again: “Many economists, including Janet Yellen, view global economic troubles since 2008 largely as a story about “deleveraging” — a simultaneous attempt by debtors almost everywhere to reduce their liabilities. Why is deleveraging a problem? Because my spending is your income, and your spending is my income, so if everyone slashes spending at the same time, incomes go down around the world.

Or as Ms. Yellen put it in 2009, “Precautions that may be smart for individuals and firms — and indeed essential to return the economy to a normal state — nevertheless magnify the distress of the economy as a whole.”

The worst thing that can happen with national debt is that it does not get reimbursed. Then debt will act as a tax on those who had money to lend it. Not a tragedy. The failure of the Euro would be a tragedy, though.

So is sub-performing economic activity. It’s not a question of not buying enough cars, TV, pants and houses. It’s also a question of the educational system going down (so kudos to Obama for proposing to make college free… Although that just part of the problem).

What does debt do?

It augments the quantity of money on the economy while allowing greater economic activity. So, when demand is faltering, it makes demand higher than it otherwise would have been.

With all the infrastructure decaying, or proven insufficient, such as the educational system, one can only observe that more activity is needed.

A related problem is that the velocity of money has collapsed… Another indication of the insufficient economic activity.

Krugman again: “This was a prescription for slow-motion disaster. European debtors did, in fact, need to tighten their belts — but the austerity they were actually forced to impose was incredibly savage. Meanwhile, Germany and other core economies — which needed to spend more, to offset belt-tightening in the periphery — also tried to spend less. The result was to create an environment in which reducing debt ratios was impossible: Real growth slowed to a crawl, inflation fell to almost nothing and outright deflation has taken hold in the worst-hit nations.

Suffering voters put up with this policy disaster for a remarkably long time, believing in the promises of the elite that they would soon see their sacrifices rewarded. But as the pain went on and on, with no visible progress, radicalization was inevitable.”

Radicalization? It looks more like Enlightenment to me. Or then, one should go at the root of radical, which is root. Voters are starting to get to the root of the problem: they were manipulated by a class of greedsters who hold power…. And lied to get there.

Insufficient economic activity creates a plebs that does nothing but getting enough subsidies to get by, while a plutocracy rules above it. This is what happened to the Roman empire. Starting around 160 CE, taxes, especially on very rich estates became insufficient to support even the military.

Taxing the hyper rich then (as was done earlier under emperor Trajan) would have allowed to re-institute welfare for children, and make the military as strong as it was under Trajan (that, in turn brought peace and prosperity).

Are we not learning history?

Patrice Ayme’

Arm Ukraine, Disarm Bankers

February 2, 2015

Before scoffing that both subjects have nothing to do with each other, please be informed that they do. And the name is Putin. The kleptocratic regime in Moscow has been using elements of Western high finance and banks to launder the money it steals.

And not just through Cyprus’ banks. This, in turn, means that much of Western high finance is penetrated not just by Mr. Putin’s goons, but also by Putin’s spirit of ultimate greed and ever more gigantic empire, in total disregard of anything else, just to fill up empty hearts. If Putin can get away with exerting so much force, why cannot we do the same? Say the bankers. And they preen. Reciprocally, as Putin enjoys collaboration from Western plutocrats, Putin feels that plutocracy and civilization are the same.

It’s a vicious spiral of mutual encouragement.

I was astounded this week when I saw Putin declare, apparently seriously, that NATO has a “foreign legion” in Ukraine.

Mr. Putin, surrounded by enthusiastically approving and nodding generals, declared to students in St Petersburg that Ukraine had a few divisions fighting in Eastern Ukraine, but that “trying to contain Russia was against Ukraine national interest“. Then Putin added:

“In effect, it is no longer an army but a foreign legion, in this case NATO’s foreign legion, which does not of course pursue the aims of Ukraine’s national interests”.

Putin's Volunteers Are Streaming West

Putin’s Volunteers Are Streaming West

The way it was said, in conjunction with Putin’s recent admission that Russian “volunteers” were fighting in Ukraine, is basically a declaration of war. On top of this, the head of the Eastern Ukraine rebels declared that he was raising a 100,000 men army. This means he expect tens of thousands of Russian troops (Putin’s “volunteers”) to cross the border.

This is not contained. Putin is billowing out of control, all by himself. One has to see what the combination of Putin’s dictatorial powers, media control, psychology and sinking economy leads to. Let me spell it out.

Once Putin has conquered Ukraine, he will push for more: he is already partly occupying Moldavia, WEST of Ukraine. Putin is also messing up with Hungary: there were street protests about this, just yesterday, in Budapest. Putin uses the fact that Hungary is extremely dependent upon Russia’s fossil fuels. Merkel, who desperately wants to avoid war with Putin, flew to Budapest in emergency, to sort the situation out.

Says the New York Times in “Putin Resumes His War”:

“American officials acknowledge that Russia has repeatedly violated an agreement, reached in Minsk in September. The agreement called for an immediate cease-fire in Ukraine, the removal of foreign forces and the establishment of monitoring arrangements to ensure that the border between Ukraine and Russia would be respected.

In recent weeks, Russia has shipped a large number of heavy weapons to support the separatists’ offensive in eastern Ukraine, including T-80 and T-72 tanks, multiple-launch rocket systems, artillery and armored personnel carriers, Western officials say.

Some of the weapons are too sophisticated to be used by hastily trained separatists, a Western official said. NATO officials estimate that about 1,000 Russian military and intelligence personnel are supporting the separatist offensive while Ukrainian officials insist that the number is much higher.

Supported by the Russians, the separatists have captured the airport at Donetsk and are pressing to take Debaltseve, a town that sits aside a critical rail junction.”

An argument, a self-contradictory argument, deployed by the cowardly, is that Putin may raise the stakes, if he sees Western modern weapons coming to the help of Ukrainians. In other words, appeasers are saying: Putin is Hitler, so let’s not irritate him, let’s make friends instead. The argument is self-defeating: if Putin is Hitler, as they insinuate, why to appease him? Did we not try that before? With Hitler, of course, but also with Kaiser Wilhelm II, who launched World War One: the Americans traded with the Kaiser, for years, through the Netherlands, enabling the crazed dictator to pursue his war (and then the Netherlands got savagely attacked by the Nazis in 1940!)

(Notice that I did not mention Stalin: although Stalin was a monster, he mostly respected international agreements. It’s not Stalin’s fault that Roosevelt gave him half of Europe at Yalta. Not only did Stalin respect Ukraine’s historical borders, but the Soviet dictator gave Ukraine a seat at the UN… Although many Ukrainian had risen against him during WWII.)

I, personally, saw enough: Putin is Hitler. New and improved. A craftier version of Hitler, with nukes.

Putin was very clear that he wanted to invade Eastern and Southern Ukraine. The “New Russia” invaded by Catherine of Russia… Truly old Ukrainian territory… for a millennium.

If we let Putin invade half of Ukraine, as he wants to do right away, he would be propelled, by the logic of war, aggression and the concomitant collapsing economy, by the same exact forces which pushed Hitler to want always more, always faster.

The robbing of the Jews Hitler indulged in, was directly related to the sinking of the German economy under the weight of intense militarization. To make his followers richer, Hitler redistributed the Jews property. (“Kristallnacht, and the like, 1938.)

From total media control, Hitler saw his popularity soar. Hitler, initially a divisive figure favored by only one German voter out of three, reached 85% approval rating. Exactly like Putin now.

The worse things got, the more popular Hitler got. As the Reich was collapsing, crushed by carpet bombing, with more than ten million soldiers invading it from the west and the east, Hitler was at its most popular. (If you disagreed, some SS were ready to kill you on the spot, that helped the monster’s approval rating.)

Putin’s economy is imploding. Just as Hitler’s was.

So it is tempting for the dictator to reproduce the exact same program. After Munich, in 1938, Hitler was given the part of Czechoslovakia where he claimed Germans were living. In short order, he had occupied the whole country, and enslaved its weapon industry.

Then Spain finished falling to the fascist, and Hitler attacked Poland. At this point Britain decided to support France, and World War Two was on.

It is absolutely certain that a similar situation will develop. Putin admitted that the real problem is not that he annexed Crimea (and now wants a land bridge to it), but that “I can be in Kiev in two weeks”.

Arming Ukraine enough to enable it to resist now will break Putin’s plan, and not let him turn into the irresistible victor he would otherwise pass for.

If we lose Ukraine, we will lose peace. A new world war will start. This time, with nukes.

Putin is a dictator passed the tipping point into ever more violence. Should he conquer all of Ukraine (which he himself defined as “his real problem”), he would militarize Russia even more than it already is, and make the economic situation even worse. So only more aggression would then stabilize his regime.

This pattern has been seen throughout history: militarization and invasion stabilize the augmentation of dictatorship.

Thus, piece by piece, Putin is exactly following Hitler’s playbook. He is just more careful, because he knows Hitler went too fast. We have to give him an unambiguous warning that he will be stopped. The earlier, the less costly.

One of the factors encouraging Putin is that the West is poorly defended.

In particular, the USA has no appropriate air superiority fighter: from corruption, 55 billion dollars has been spent on the F35, a plane that does not work, cannot work, and, moreover, is already at least eight years late.

Austerity is not just a way to make the small suffer, but a way to insure we are defenseless.


Krugman wrote an editorial about the fact that long term worries about potential deficits in the distant future, are killing today’s economy in The Long-Run Cop-Out”.

On Monday, President Obama will call for a significant increase in spending, reversing the harsh cuts of the past few years. He won’t get all he’s asking for, but it’s a move in the right direction.”

Notice that Krugman is now admitting that Obama was an austerian, a Tea Partier, a whatever was not too good for the USA economy (and it’s true!)

Well austerians are also killing equality, education, and defense… While allowing crooks such as Putin to launder all the money he wants in the West (and thus capture Western media).

Private banks are money creating machines. They create money through the credit they extent, to those they like. Banks (and so-called shadow banks) caused the crash of 2008. However, the deregulation of finance that allowed them to transfer huge amount of wealth to the wealthiest, before, during, or after the crash, was not corrected.

Instead, misleading discourses were deployed to accuse other actors in the economy of this astronomically large swindle: little guys borrowed too much, they had been living too large, etc.

Thus the banking system as a machine to make the wealthiest even wealthier, was left as it was before 2008: financial derivatives monopolize even more wealth than they did before 2008. Namely 12 times world GDP.

Banks are machines to create injustice and inequality have suffered no significant disruption, and their profit margins at this point are the highest with those of Big Pharmaceuticals. The graph is in:

Banks are free to give to their friends and their class. More than ever.

The entire “austerity” drive is thus not to reduce how much money, hence power, the wealthiest possesses. It is about reducing how much money and power the non-wealthy possess. Thus “austerity” is a trick to augment the relative wealth and power of the wealthiest.

The problem, for the wealthiest and most powerful, is to disguise that true reason for austerity, which is greed. So they made up stories, and they could be anything, as long as they are misleading, to fascinate We The People with. Long term doom and gloom is best, as it looks very serious.

The more serious the economic inequality becomes, the easier it should be to make the case that inequality is the principal economic problem. However, the “austerity” drive has to be shown first to be the problem, instead of a solution.

Todays’ situation is developing increasingly parallels with the 1930s. A first crucial mistake in 1936, was not to react to fascist aggression against the democratically elected Spanish Republic. Mussolini and Hitler were left free to send their armies into Spain.

Time to not repeat history.

The democratic Ukrainian republic needs help from the fascists. Give it. And give it first efficiently, and under cover, to make it more difficult for Putin to escalate quickly. For once the CIA and its ilk could become useful. (The predecessor of the CIA, the OSS, was extremely efficient in WWII.)

Putin plays dirty, democracy cannot play clean and nice.

This is an occasion for the timorous Obama administration to show that it has some courage. It is an occasion for Obama to show he was not just into assassinating innocent civilians with drones, thus making a bad situation way worse. Can Obama stand up to the man?

Patrice Ayme

Full Frontal Naked Nationalism

May 27, 2014

Or When Nationalism Is Better Than The Alternative.

The Danes self define as the happiest people in the world: sometimes it seems the government chew their food for them (the Danish tax rate goes up to 80%). Danes are worried “Brussels” will put an end to that. Whatever that is. In truth, alien foreigners have exhausted their welcome. On May 25, 2014, 27% voted for the nationalist anti-European far right.

That’s the same score as Marine Le Pen got in France.

French President Soon? Careful, She Bites

French President Soon? Careful, She Bites

What’s going on? Well, each time extremism rises, it’s because there are very good reasons for this to happen. Clearly the status quo ante is unacceptable in Europe. Something I have said myself for years. And not just in Europe. A revolution is needed, and fast. More and more of We The People are arriving at the same conclusion. That’s good and necessary.

I still am an extreme internationalist. For me, for decades, nationalism was the definition of hatred and war. I was also against imperialism. I was once personally attacked by hyper nationalistic fascists, with lethal force (an IED).

Apparently, they saw my broad minded considerations as an existential threat. Nationalists tend to be mentally fragile.

Meanwhile I discovered that being against blue sky meant preferring the blackness of space. To my dismay, having a high minded internationalist mien is an invitation to victimization. It’s quite a bit related to the attitude of the Jews vis a vis Hitler in the 1930s: it’s not because you turn the other cheek, each time it gets slapped, that morality, let alone survival, progresses. Instead, the pacifist sheep will get a concussion, and finish in the incinerator.

Ukraine, of course, is an example when nationalism is turning into a good force. Only nationalism is strong enough to resist the traditional dictatorial instincts of the Kremlin. Better plenty of nationalism, than morbidity below a crazed autocrat’s boot.

In France the national Front just won the European election, becoming, on this occasion, France’s first party. It’s a victory for Marine Le Pen’s strategy over her dad’s grumpy style.

One would guess that I am horrified, as I am as progressive as they come.

But not so. Instead I am amused: progress is not always where it’s supposed to be.

Sometimes, progress takes a circuitous route. It’s because plutocratic Rome collapsed that the Franks could take over, and legislate a much more advanced civilization: much fewer death penalties, no more slavery, total religious freedom (after more than a century of religious terror).

If plutocratic Rome had not collapsed,  the barbarity of Greco-Roman civilization would have persevered. Only a radical reboot, the one the Franks imposed, could relaunched Western civilization in a sustainable form.

Another example is the occupation of France by the Nazis: it actually civilized the Nazis to the point that collaboration with France was forced onto Hitler by his colleagues to the point the Nazi dictator had to agree to it, although he argued that would make France win the war (as France’s industry was supposed to fabricate daily necessities, while Germany concentrated on weapons).

The end result is that France and Germany started to unify in 1948, something that certainly would not have happened if France had not declared war to Germany in 1939. War is also a debate.

In 2012, I saw a debate between Marine Le Pen, and the top French economy pundit. Marine Le Pen described basically how the fractional reserve system worked, and intoned that this was completely wrong. However, the cocksure pundit     excoriated her, with conventional wisdom. He claimed she understood nothing, had no knowledge of finance whatsoever.

A week later, the same pundit debated economics with Melanchon, head of the leftist opposition to the Socialist Parti, the Front de Gauche. Melanchon told the pundit he had been wrong, and Marine Le Pen was right.

And so do I.

On a related subject, Marine Le Pen has been very loud and clear that the Euro was too high. That, too, is correct. The high Euro has been killing the part of French industry that makes mass items (whereas Italy, Switzerland and Germany long focused on higher end products).

It’s of course worse for many other Euro countries.

Many European countries have been de-industrializing. It’s not because people there are dumb and lazy. Far from it. In truth Europe invents much, and other exploits those inventions.


Well, Europe is open to the world economically, a bit as Athens was. and Pericles beautifully boasted in his famous funeral oraison. However openness is not everything: Athens was defeated and democracy came back, under the attenuated form of representative democracy, only 23 centuries later.

European intellectuals themselves have excoriated Europe, as if it were the source of all evils. Confusing the Nazis and their enemies the French is a case in point, chronic in the enslaved USA.

And yet, what is the truth? The rest of the world has not played nice with Europe.

Take an outrageous example. European governments have been buying from the USA. The converse, though, is forbidden by American law (except under special circumstances).

The conspiracy against Europe is deep and wide. Corrupt American industrialists, working hand in hand with the government of the USA and corrupt leaders overseas (example of such corruptocrats would be Major, Schroeder, and Blair) conspired to impose a war plane, the F35.

The F35 is the world’s worst plane: it has no better performance than the F105 “Thunderchief”, a 50 year old plane that failed in the Vietnam war. The F35 can’t go fast, it can’t carry much, it can’t accelerate more than 4 gs (the Rafale does 10gs), and, although labelled a “stealth” plane, it is fully visible to Russian and Chinese VHF radar. It’s also the most expensive military program ever: half a trillion dollars, and counting.

That turkey prevents the furthering of a European superiority fighter, although Airbus‘ Typhoon/Eurofighter  and Dassault fighters are known to be the world’s two best fighter bombers (they both take out the American superiority fighter, the F22 Raptor).

So hundreds of thousands high tech defense jobs are going to the USA, instead of Europe, on that project alone. Just because European politicians have been on the take. At least, nationalism would stop such an absurdity.

To stop all this non sense, some nationalism is needed. Some will say, as some French philosophers did, that Europe is dead, long live the world.

Yet, it’s not so simple: as I explained, both North America and Russia have been founded on maximally exploitative philosophies, which have triumphed.

Europe’s sustainable philosophy has taken a beating, and the weaker Europe gets, the more of beating sustainability gets.

So this is not just about Europe, it’s about sustainability and diversity.

Out of 750 European MPs, around 140 are Europhobes. The Danes and the British UKIP despise Marine Le Pen. Yet, if they want to have any influence in the European Parliament, the Europhobes will have to find common grounds, thus valuable complaints.

The force of democracy is the wealth of viewpoints it brings.

And never forget that democracy without force is nothing.  A six year old British      boy was found drowned and unconscious at the bottom of a pool of the giant “Royal Caribbean” ship “Independence of the Seas”.

Well, there is no independence, even on the high seas. Even for a British boy, whatever the UKIP feels like bellowing about. A French helicopter flew across the ocean, and picked up the unconscious boy to provide him with state of the art treatment (top French hospitals use methods akin to hibernation, as was done with Michael Schumacher).

It’s a small world, and in a small world there are no borders, only limits beyond which outrage turns to violence. And the worst is, that some of this violence is necessary, and the more necessary, the more violent it will become. Europe, and the world, has to march ahead, or die by the wayside.

Patrice Aymé

Banking On Banksters

May 19, 2014

I was gloomy as I saw what happened in 2008 and thereafter: the very financiers who had stolen all the money, were given trillions, to replace what they had stolen. It was as inconceivable as the worst horrors of history, but it proceeded.

In exchange the crooks did not even have to recognize they had been wrong. When it dawned on our unworthy leaders that it looked bad, all this giving from the poor to the richest fortunes in the world, they invented something else: easing money creation for top banks, so that they could “reimburse” the Public: that’s called “Quantitative Easing” (or “the Twist”, or…)

It’s a pleasure to now have Paul Krugman seeing the light, six years later, in “Springtime For Bankers”.  Oh, don’t jump for joy, yet. No, Paul is not seeing the light about “Quantitative Easing”, that’s still beyond what he can conceive at this point. But he has finally seen that the exalted status of banking itself is the problem, and, more generally that:

…”economic policy since the onset of the financial crisis has been a dismal failure. It’s true that we avoided a full replay of the Great Depression. But employment has taken more than six years to claw its way back to pre-crisis levels — years when we should have been adding millions of jobs just to keep up with a rising population. Long-term unemployment is still almost three times as high as it was in 2007; young people, often burdened by college debt, face a highly uncertain future.

Now Timothy Geithner, who was Treasury secretary for four of those six years… thinks he did a heckuva job.

He’s not unique in his self-approbation. Policy makers in Europe, where… a number of countries are in fact experiencing Depression-level distress, have even less to boast about. Yet they too are patting themselves on the back.

How can people feel good about track records that are objectively so bad?…

In both Europe and America, economic policy has to a large extent been governed by the implicit slogan “Save the bankers, save the world” — that is, restore confidence in the financial system and prosperity will follow…

Mr. Geithner’s book is devoted to a defense of the U.S. financial bailout, which he sees as a huge success story — which it was, if financial confidence is viewed as an end in itself… But where is the rebound in the real economy? Where are the jobs? Saving Wall Street, it seems, wasn’t nearly enough. Why?

One reason for sluggish recovery is that U.S. policy “pivoted,” far too early, from a focus on jobs to a focus on budget deficits. Mr. Geithner denies that he bears any responsibility for this pivot, declaring “I was not an austerian.” In his version, the administration got all it could in the face of Republican opposition. That doesn’t match independent reporting, which portrays Mr. Geithner ridiculing fiscal stimulus as “sugar” that would yield no long-term benefit.

But fiscal austerity wasn’t the only reason recovery has been so disappointing… there was, arguably, a lot the Obama administration could have done to reduce debt burdens without Congressional approval. But it didn’t; it didn’t even spend funds specifically allocated for that purpose. Why? According to many accounts, the biggest roadblock was Mr. Geithner’s consistent opposition to mortgage debt relief — he was, if you like, all for bailing out banks but against bailing out families…

…leading experts on this subject are the economists Atif Mian and Amir Sufi, whose just-published book “House of Debt” argues very much the contrary. On their blog, Mr. Mian and Mr. Sufi point out that Mr. Geithner’s arithmetic on the issue seems weirdly wrong — order of magnitude wrong — giving much less weight to the role of debt in holding back spending than the consensus of economic research…

In the end, the story of economic policy since 2008 has been that of a remarkable double standard. Bad loans always involve mistakes on both sides — if borrowers were irresponsible, so were the people who lent them money. But when crisis came, bankers were held harmless for their errors while families paid full price.

And refusing to help families in debt, it turns out, wasn’t just unfair; it was bad economics. Wall Street is back, but America isn’t, and the double standard is the main reason.”

Some hold that Timothy Geithner is creep central. This plutocrat got his jobs because of his connections, and is now president of “private equity” (understand: conspiracyplutocratic central) firm Warburg Pincus. Obama was forced to select the 2008 crisis maker Geithner over his spiritual father, the extremely well connected Lawrence Summers, because Summers’ towering reputation as a sexist, derivatives and plutocratic fiend, was so colossal that even the powers that be cringed.

It’s true that, as chief of the New York Fed, Geithner was the prime proximal architect of the 2008 crisis, so hell could not have been in better hands.

Last week, the New York Times censored by comments about “glaciers disintegrating”, probably because the message that the melting would go faster by one order of magnitude than announced, did not go down well.

This time, one deigned to publish me (progress: in the past such a comment on finance would have been censored). Here it is (beefed up):

“Save the bankers, save the world?” It is worse than that. The bankers are who create the money, and they do so, by re-distributing it, to whom, and what, they feel worthy.

The financial crisis 2008 revealed that bankers had lent the money to unprofitable projects, on such a scale that banks went bankrupt.  In the European Union, and the USA.

It’s true some of the money, in the USA, was lent directly to families who could not pay back anymore the debts they had incurred. How did this happen on such a scale? Because those millions of home owners had been tricked into incurring these debts by misrepresenting the payments those people would have to make.

Thus the bankers behaved like gangsters. However, in spite of the colossal misery they caused, none of these gangsters was prosecuted.

Moreover, bankers had also created a lot of money they lent for highly leverage financial derivatives operations that went very wrong (they went wrong, in part because, by all betting that what they thought could not happen would not happen, the bankers made sure that it would happen). An example of this hedging gone wrong is the bankruptcy of American International Group, AIG (that cost nearly 200 billion dollars).

The futility of separating one side of the Atlantic from the other was made blatant by AIG. The specific unit of AIG that leveraged AIG into oblivion was operating from London.

Highly leverage derivatives was another way bankers went wrong. Those derivatives, in particular the financial ones, dwarf the real economy.  This means the banks are financing a virtual economy, not the real one.

The same phenomenon festers in Europe. The money was not lost for everybody, though: the richest have got much richer.

Rogue bankers create money for themselves and their friends. The public is then asked to bring fresh money to refloat the banks that the bankers and their friends just stole. Then innocent entities get accused (subprime mortgage holders, the Euro, etc.)

In New York, one, just one junior trader was prosecuted for the 2008 crash. He was French, of course. In France Jerome Kerviel was condemned to three years in jail (and initially a multi-billion dollar fine), for having, allegedly,  lied to his employer.

It has not struck the corrupt mind of “justice” that it’s a corrupt organization that allows just one man to trade 80 billion dollars. A corrupt organization in a corrupt system.

Kerviel indeed vociferously asserts that there was an extensive conspiracy to protect Societe’ Generale, one of the world’s biggest bank.

Meanwhile American justice pursues criminally some Swiss bankers. Swiss bankers are from a country small enough to eat raw. French bankers are another matter, and American bankers are, naturally untouchable (American banks are made to pay fines… from QE).

The European economy has been ravaged to give as much money to the bankers and their accomplices as what they had just stolen. And this “austerity” is still going on. Tellingly, in Europe, only the far left and far right parties are starting to understand the extent and nature of the theft, and talk about it. No wonder that they will progress in the European elections, because, increasingly, people are starting to understand the truth. Hey, Nobel Laureate Paul Krugman is nearly there!

The bankers have been saved. The world is therefore still at their mercy.  “Save the bankers, save the world” is in truth: ”Save the gangsters, save the world”. This financial plutocracy is there to stay, We The People are left to pray. On our knees.

Patrice Aymé