Like its conservative brethren, the LA Times, one of Wall Streets liberal bastions of deliberately keeping the masses uninformed and misinformed, reported “This year there was a 23 percent increase in the overall number of people found on the streets countywide (Los Angeles County). For the city, that increase was 20 percent.” Reporter Dennis Romero reports LA rents have increased 32 percent throughout the Los Angeles County since 2000, while incomes have decreased 3 percent, and this accounts for the growing homelessness. This, of course, is total bullshit. See Homelessness Gets Worse as Rents Continue to Increase–LA Times
Romero then goes on to write, “The California Housing Partnership Corporation this month concluded that the county needs an additional 551,807 units for people on the edge of homelessness….The homeless figures make “it very clear that our continuing homeless crisis is being driven by a housing crisis,” L.A. County Supervisor Sheila Kuehl said in a statement.” This statement, too, is total bullshit.
Being a good corporate reporter, Romero does not ask why there is a housing crisis in Los Angeles, as well as across the United States. Nor is he clever enough to ask why wages have gone down and rents have gone up.
Here are the real reasons rents and home prices have skyrocketed over the last several years. I’ll deal with declining wages another day.
The five biggest banks conspired together to drive the cost of rents and houses up by holding over half the stock of vacant houses off the market by 2011. As prices have illegally risen, the banks have slowly allowed more and more houses onto the market. This is called a conspiracy in restraint of trade, which is illegal, but profitable.
This means the price of homes and rents are illegally and artificially higher than they should be. Had the market been allowed to set prices after the Great Recession of 2007-09, it is very likely rents and housing prices would be half or nearly so of what they are now.
In other words, this conspiracy redistributed trillions of dollars of income from the 99 to the 1 percent, and this was done with the permission of the Obama Administration.
The current economic expansion is almost exclusively being powered by the illegally contrived boom in housing prices and rents, and so the latest housing bubble is largely powering the latest stock market bubble, and this is likely why both Obama and Trump have never had any desire to enforce anti-trust laws against the big banks since both are owned lock, stock, and barrel by the big banks. By the way you Hillary lovers! Clinton is completely owned by Wall Street too.
And this is how we are kept misinformed, misled, confused and uninformed by the corporate media.
What are the most stark differences between the administration of President Obama and the incoming president Donald Trump?
Wall Street’s Citigroup runs the white house under Obama, and would likely have done so under Hillary Clinton. Under Trump, Citigroup is out and Goldman Sachs is in. What a difference! Wall Street elites are still going to be determining US economic policy, which primarily consists of plots to redistribute income and wealth from the 99 to the 1 percent.
In other words, under Trump hope and change sound a lot like the same old failed policies Wall Street has been using to weaken the US economy by killing the middle class.
Wall Street powerhouse Citigroup played a powerful role in shaping Obama’s economic agenda, which meant pushing the Trans-Pacific Partnership, which would’ve lead to the exporting of millions of US jobs.
Michael Froman, now Obama’s U.S. trade representative, was an executive at Citigroup. On October 6 2008, he wrote an email to John Podesta, then co-chair of Obama’s transition team. The subject was “Lists.” Froman used a Citigroup email address. He attached three documents: a list of women for top administration jobs, a list of non-white candidates, and a sample outline of 31 cabinet-level positions and who would fill them. “The lists will continue to grow,” Froman wrote to Podesta, “but these are the names to date that seem to be coming up as recommended by various sources for senior level jobs.”
The cabinet list ended up being almost entirely on the money. It correctly identified Eric Holder for the Justice Department, Janet Napolitano for Homeland Security, Robert Gates for Defense, Rahm Emanuel for chief of staff, Peter Orszag for the Office of Management and Budget, Arne Duncan for Education, Eric Shinseki for Veterans Affairs, Kathleen Sebelius for Health and Human Services, Melody Barnes for the Domestic Policy Council, and more. For the Treasury, three possibilities were on the list: Robert Rubin, Larry Summers, and Timothy Geithner.
In other words, Wall Street was calling all the shots in the Obama administration.
President-elect Trump so far has tapped former Goldman Sachs Group Inc. executive Steven Mnuchin (a co-investor with hedge fund billionaire George Soros) to be his Treasury secretary and billionaire investor Wilbur Ross to lead the Commerce Department. Trump even met with Goldman Sachs President Gary Cohn inside Trump Tower this week.
In the days following these announcements, shares of all the big Wall Street firms climbed, with Goldman Sachs rising more than 3 percent by noon in New York.
So it appears Goldman Sachs and billionaire investors other than Citigroup are going to be running the show in the White House. Now that’s not a whole lot of change.
Below is a Trump presidential advertisement that blamed Wall Street for wrecking havoc with the US economy, and now he has embraced everything they have stood for.
As Donald Trump reeled from his latest stupidity, Wikileaks released over 200,000 emails of John Podesta, Hillary Clinton’s presidential campaign manager. There were several revealing statements about Clinton.
According to the Daily Beast, “The statements by Clinton, which were gleaned from documents that have yet to be authenticated by The Daily Beast, were made in private settings to big banks and Wall Street firms. The speeches appear to paint her in the worst possible light: two-faced, out of touch, secretive and subservient to Wall Street. And in the most explicit way possible, validate Bernie Sanders’ criticisms of her during the Democratic primary.”
Perhaps the most damaging to Clinton—and most validating to Sanders—will be her fawning speeches about Wall Street—to Wall Street. In her remarks, Clinton appears to prove Bernie right. At a Goldman Sachs symposium in 2013, Clinton said that when she began traveling as Secretary of State, people would “yell at me for the United States and our banking system” causing the financial crisis.
“Now, that’s an oversimplification we know,” Clinton assured the Goldman Sachs audience. “But it was the conventional wisdom.”
“Was the conventional wisdom?” Wrong! Study after study puts the blame squarely on Wall Street for the economic meltdown of 2008.
In another excerpt, Clinton says those who work inside a regulated industry are best poised to then regulate the industry. “How do you get to the golden key, how do we figure out what works? And the people that know the industry better than anybody are the people who work in the industry,” she allegedly said.
Apparently, Clinton approves of the revolving door between Wall Street and government. So we know she doesn’t want much regulation of Wall Street, unless Wall Street appoints the regulators.
“Speaking about her prior run for president in 2008, Clinton also says she is beholden, in a way, to big special interests such as the big banks, because “it would be very difficult to run for president without raising a huge amount of money and without having other people supporting you because your opponent will have their supporters.”
“I’m kind of far removed,” Hillary said, from the struggles of the middle class and “growing sense of anxiety and even anger in the country” because of the “fortunes” that she and former President Bill Clinton currently enjoy.
The Clinton’s have made over $150 million from speeches to big business since President Clinton left office. That includes millions from Wall Street. I wonder where her loyalties are? It should be obvious about what Sanders says above. But he could’ve also said, “It is Wall Street that regulates congress and the president.”
The Trans-Pacific Partnership (TPP) is a corporate power grab, a 5,544-page document that was negotiated in secret by big corporations while Congress, the public, and unions were locked out.
Multinationals like Google, Exxon, Monsanto, Goldman Sachs, UPS, FedEx, Apple, and Walmart are lobbying hard for it. Virtually every union in the U.S. opposes it. So do major environmental, senior, health, and consumer organizations.
This agreement has virtually nothing to do with trade since tariffs between the twelve nations of the TPP are at historic low. This agreement is really about exporting jobs, raising prices and more bonuses for the 1 percent at the expense of the 99 percent.
The TPP will mean fewer jobs and lower wages, higher prices for prescription drugs, the loss of regulations that protect our drinking water and food supply, and the loss of Internet freedom. It encourages privatization, undermines democracy, and will forbid many of the policies we need to combat climate change.
The worst part is the Investor-State Dispute Settlement provision, which allows a multinational corporation to sue to override any U.S. law, policy, or practice that it claims could limit its future profits. Secret panels of corporate lawyers and corporate lobbyists will decide these cases. Their judgments cannot be appealed, not even to the Supreme Court.
This provision will override your votes on the state and local levels. In other words, President Obama and Wall Street Senator Ron Wyden intend to suppress your voting rights, along with most of the Republican Party led by Paul Ryan, Mitch McConnell and Orrin Hatch.
Though the Obama administration touts the pact’s labor and environmental protections, the official Labor Advisory Committee on the TPP strongly opposes it, arguing that these protections are largely unenforceable window dressing.
On behalf of Wall Street and rich investors throughout the United States, President Obama is planning to call for a vote on the TPP in the US senate and the US House after the elections in November. Obama signed the TPP, a despicable income and political power redistribution scam, months ago. Wall Street Senator Ron Wyden will likely introduce the TPP in the senate. Wyden is Obama’s and Wall Street’s attack dog in the US senate in their war against the middle class. He has voted to redistribute trillions of dollars from the 99 to the 1 percent over the course of the his career in congress.
Lehman Brothers was allowed to fail. That’s all you need to know. Lehman was one of the largest investment banks in the world. And yet, when push came to shove, the government allowed the company to die. It didn’t impact me or you one bit, unless you were heavily invested in the company.
What would’ve happened if Goldman Sachs or JP Morgan/Chase had been allowed to die? Nothing, except several of their hedge funds and a lot of superrich people would’ve been allowed to fail with them. Tens of billions of dollars would’ve evaporated with the implosion of these corporations that have gone to corrupting government and both major political parties. Had they been allowed to fail, that probably would’ve been a good thing for 99.9 percent of all American citizens. Democracy would’ve been a little less corrupted.
The slogan “Too Big to Fail” should be changed to “Too Big to Exist.” If anybody thinks they’re too big to be allowed to fail, then the logical thing is that they should be broken up into more competitive pieces, which is what the Sherman Anti-Trust Act is supposed to do, if it were seriously enforced by the US government, which won’t do this because the politicians have been under the intoxicating influence of the billions of dollars of the big banks give them.
A few years ago, congress approved and President Obama signed legislation called Dodd-Frank, which was supposed to regulate the actions of Wall Street banks by curbing the financial crimes and other unethical shenanigans of the big banks. Dodd-Frank was weak legislation, badly watered down by Wall Street lobbyists, so the press told us. What the corporate press didn’t tell us is that it was created to be ineffective.
That’s because of Hedge Funds. Hedge funds are unregulated investment firms not impacted by Dodd-Frank, or any other federal regulations.
The big banks all own hedge funds, which are many times larger than the big banks. So, for example, if Goldman Sachs is worth $20 billion, then its two hedge funds are worth closer to $100 billion each. That means only the front company of these investment banks are being “weakly” regulated.
Under the above scenario, only 8 percent of Goldman Sachs is being weakly regulated by Dodd-Frank and whatever other rules are in the federal books. The same holds true for Citibank, JP Morgan/Chase and all the other big banks that have hired the Clinton’s to give speeches on topics they don’t know much about.
In ballyhooing Dodd-Frank, the Democrats achieved virtually no regulations on Wall Street, but they did create a smokescreen by which they could claim they did something significant. Blow away the smoke screen, and they achieved almost nothing in the way of regulating Wall Street.
Hedge Funds were created in 1940. They were small wealth managing companies that were limited to having 99 clients or less via a loophole in the New Deal Reforms.
“The Investment Company and Investment Advisers Acts of 1940 prohibited firms operating with pools of investor money from engaging in risky practices like short sales (bets that a stock will go down instead of up), leverage (investing with borrowed funds to amplify returns and heighten risk), and corporate takeovers. Meanwhile, investment companies had to register with the Securities and Exchange Commission (SEC), disclosing their portfolios and their corporate structures. The 1940 laws also restricted certain types of fund manager compensation. The purpose was to eliminate the kind of speculative risks with pools of capital that generated the Great Depression.”
Hedge Funds were never a big player in today’s financial markets until one day in 1996 “President Bill Clinton signed the National Securities Markets Improvement Act (NSMIA), which overhauled state and federal responsibility for securities market oversight. It was part of a series of financial market deregulations in the Clinton era, advanced with broad Wall Street support and almost no resistance in Congress: After bipartisan agreement, the House and Senate finalized NSMIA with a voice vote.”
BarclayHedge now estimates hedge fund assets under management in the third quarter of 2015 at $2.7 trillion, up from about $100 billion in 1995. And that doesn’t count the borrowed money also invested by the same firms, which likely total trillions more.
After Clinton left office, Wall Street investment banks rewarded Bill and Hillary Clinton for their loyalty by paying them millions of dollars in speaking fees. No doubt, President Obama will get the same deal if he can get the Trans Pacific Partnership passed through congress via partnership with the Republican Party.
The game is still rigged and Dodd-Frank is almost completely useless thanks to the big banks and their Hedge Funds.
As for Hedge Funds, they are now the preferred vehicle of ripping people off, manipulating markets via their trillions of dollars, helping the big banks keep millions of homes off the markets so as to create the current (as well as the last) housing bubble, and so much more.
The Clinton’s have exacerbated our current crisis of democracy. Vote Bernie Sanders!
You know the Wall Street Democratic Party Establishment has pulled together and is pulling no punches and hitting low in the clinches when New York Times syndicated columnist and Economics Nobel Prize winner Paul Kruger launches a diatribe against the senator from Vermont by feigning ignorance of Wall Street crimes and complicity in the last economic disaster.
This suggests the Establishment and its presidential candidate are worried stiff over Bernie Sanders beating Hillary Clinton in the remaining primaries and winning the nomination. Sanders is gaining momentum while the Wall Street candidate continues to lose it. More and more African-American voters, for example, are voting for Bernie the more they get to know him.
Krugman was corrupt enough to write:
“The easy slogan here is “Break up the big banks.” It’s obvious why this slogan is appealing from a political point of view: Wall Street supplies an excellent cast of villains. But were big banks really at the heart of the financial crisis, and would breaking them up protect us from future crises?
Many analysts concluded years ago that the answers to both questions were no. Predatory lending was largely carried out by smaller, non-Wall Street institutions like Countrywide Financial; the crisis itself was centered not on big banks but on “shadow banks” like Lehman Brothers that weren’t necessarily that big. And the financial reform that President Obama signed in 2010 made a real effort to address these problems. It could and should be made stronger, but pounding the table about big banks misses the point.”
Let’s begin with Lehman Brothers. It was always a big bank on Wall Street. Now Krugman’s calling it a shadow bank. What stupidity! Apparently, Krugman also doesn’t know that Goldman Sachs was shorting home mortgage backed bonds while selling them to investors. Beside that point, Robert Reich landed a series of knockout punches to Krugman’s insanity.
Reich writes:
1. The biggest Wall Street banks did indeed precipitate the crisis on Wall Street in 2008 because of their gambling in newfangled financial instruments and fancy derivatives even they didn’t understand.
2. Their size did make a difference because they were so interconnected with other financial entities both in the U.S. and around the world that they were “too big to fail.” Today’s biggest Wall Street banks are much bigger than they were in 2008.
3. Size also has a bearing on their political influence. The reason the Glass-Steagall Act was scotched by Bill Clinton’s administration, and the Clinton administration wouldn’t agree with the CFTC to regulate derivatives, had a lot to do with the influence of Wall Street over the Clinton administration and over Congress. The political power of the biggest players on the Street is even larger today – as evidenced by their capacity to whittle back significant parts of Dodd-Frank in the regulatory process.
4. Breaking up the biggest banks isn’t a radical idea. In fact, many experts – including the current president of the Federal Reserve Bank of Minneapolis (who’s a Republican and a former executive of Goldman Sachs), and the former head of the Federal Reserve Bank of Dallas — have called for exactly this.
5. Bernie’s other ideas — for a single-payer plan, and for free tuition at public institutions of higher education – are sensible, and also backed by many experts. It’s well-established that a single-payer plan would be far less costly and deliver far better care than our own system, which is based on private for-profit insurers. As to free tuition in public universities, we were well on the way to this goal in the 1950s and 1960s. It was and is a logical extension of free K-12 education.
I should like to point out that California had free college for resident’s until the federal government began redistributing income from the 99 to the 1 percent. So it has been done in the United States.
Last week, seven US marshals, in full combat gear, arrested Paul Acre at his home in Houston Texas over a 29-year-old unpaid $1500 student loan. Reports are coming in that other people have been arrested for the same thing, as well.
The Obama administration clearly has its priorities straight. Arrest student loan defaulters, who clearly cannot make significant campaign contributions, take them to the judge, and force them into a legally binding repayment contracts. That’s what happened to Acre.
On the other hand, the Obama justice department has been careful not to investigate or charge with any crime a single Wall Street banker, or any of their underlings. You know those people even if you don’t know their names. These are the folks at Citigroup, JP Morgan/Chase, Goldman Sachs, a variety of hedge funds, and others who can and do make significant campaign contributions. They get the cash to do so through illegal activities, such as laundering Mexican drug cartel drug money, committing fraud, ripping off billions from consumers and investors, tanking the economy with illegal actions, and corrupting the US government completely.
Wall Street investment corporations have been caught doing all of this illegal stuff, and more, and have been fined by the US government, but not a single person has been charged with a crime, or arrested.
We clearly have a duel system of justice; one for the rich and powerful, and one for the rest of us.
Praise for Bernie is what Cornell West had in a recent interview with Politico magazine. In it, he excoriated Hillary for her ties to Wall Street.
According to a CNN report, Hillary and Bill gave 729 speeches from February 2001 until May 2015. The two got an average payday of $210,795 for each address. Bill and Hillary also reported at least $7.7 million for at least 39 speeches to big banks, including Goldman Sachs and UBS, with Hillary Clinton, the Democratic 2016 front-runner, collecting at least $1.8 million for at least eight speeches to big banks.
Among Professor’s West observations:
“With Obama’s departure from the White House, we shall see clearly where black America stands in relation to (Martin Luther) King’s legacy. Will voters put a smile on Martin’s face? It’s clear how we can do it. King smiles at Sanders’ deep integrity and genuine conviction, while he weeps at the Clinton machine’s crass opportunism and the inequality and injustice it breeds.
“…when it comes to advancing Dr. King’s legacy, a vote for Clinton not only falls far short of the mark; it prevents us from giving new life to King’s legacy. Instead, it is Sanders who has championed that legacy in word and in deed for 50 years. This election is not a mere campaign; it is a crusade to resurrect democracy—King-style—in our time. In 2016, Sanders is the one leading that crusade.”
King was leading the poor people’s campaign at the time of his death. Sander’s has been leading the charge for middle class, poor class, and racial equality for fifty years, while the Clinton’s have been collecting millions of dollars of speaking fees from Goldman Sachs.
West goes on:
“The Clintons’ neoliberal economic policies—principally, the repeal of the Glass-Steagall banking legislation, apparently under the influence of Wall Street’s money—have also hurt King’s cause. The Clinton Machine—celebrated by the centrist wing of the Democratic Party, white and black—did produce economic growth. But it came at the expense of poor people (more hopeless and prison-bound) and working people (also decimated by the Clinton-sponsored North American Free Trade Agreement).
“It’s no accident that Goldman Sachs paid Hillary Clinton $675,000 for a mere three speeches in 2013, or that the firm has given hundreds of thousands of dollars to her campaigns or that, in total, it has paid her and her husband more than $150 million in speaking fees since 2001. This is the same Goldman Sachs that engaged in predatory lending of sub-prime mortgages that collapsed in 2008, disproportionately hurting black Americans.”
In other words, Wall Street owns Hillary and Bill as much or more than it owns the Republican party stalwarts, such as Marco Rubio, Jeb Bush, Mitch McConnell and Orrin Hatch.
Here are the 10 major components to Sanders’ Wall Street reforms.
1. End Too-Big-to-Fail
The underlying logic of this federal policy is that the biggest banks cannot fail and shut down, even if they make terrible investments or wreak great harm to the economy, because the U.S. economy and millions of ordinary people would become financially destitute. Sanders said this “scheme … is nothing more than a free insurance policy for Wall Street.” Compared to before the crash of 2008, the biggest banks in the country are larger than ever, he said, adding, “if a bank is too big to fail, it is too big to exist.”
The truth is that the big banks are not too big to fail. When Lehman Brothers died, not one member of the 99.9 percent was impacted in the slightest. However, the super rich have a massive financial stake in the banks, and they would lose their shirts if the banks were allowed to fail. Using the “too big to fail” slogan means that the banks don’t need to be responsible for their bad decisions, and bad bets, and bad investments, and why should they? Especially when the banksters know the government or the Federal Reserve will bail them out instantly.
“In 2008, the taxpayers of this country bailed out Wall Street because we were told they were ‘too big to fail,’” Sanders said. “Yet, today, three out of the four largest financial institutions [JP Morgan Chase, Bank of America and Wells Fargo] are nearly 80 percent bigger than before we bailed them out. Incredibly, the six largest banks in this country issue more than two-thirds of all credit cards and more than 35 percent of all mortgages. They control more than 95 percent of all financial derivatives and hold more than 40 percent of all bank deposits. Their assets are equivalent to nearly 60 percent of our GDP. Enough is enough!”
Sanders concluded, “A handful of huge financial institutions simply have too much economic and political power over this country. If Teddy Roosevelt, the Republican trust-buster, were alive today, he would say, break ‘em up. And he would be right.”
2. The above is why we need to Break Up the Biggest Banks
If elected, Sanders said he would direct the Treasury Department to compile a list of the institutions “whose failure would pose a catastrophic risk to the U.S. economy without a taxpayer bailout.” Using the power of executive authority, he would break up these institutions. “Within one year, my administration will break these institutions up so that they no longer pose a grave threat to the economy as authorized under Section 121 of the Dodd-Frank Act.”
3. Pass a 21st-Century Glass-Steagall Act
This Depression-era law, which was repealed by Congress under President Bill Clinton, prevented commercial banks from investing in risky and arcane financial instruments, such as bundled home loans during the housing market bubble that predated the 2008 financial market collapse. Now investment and commercial banks are merged, and the government couldn’t bail out homeowners, such as FDR did. Had they done so, homeowners would have renegotiated lower home prices that reflected reality. But the Obama regime couldn’t do that because an 8 percent decline in home prices effectively rendered the tens of trillions of dollars in home mortgaged backed bonds valueless. Instead, the government bailed out the banks, and the Federal Reserve bailed out the banks. But they really weren’t bailing out the banks; they were bailing out rich investors.
“Secretary Clinton says that Glass-Steagall would not have prevented the financial crisis because shadow banks like AIG and Lehman Brothers, not big commercial banks, were the real culprits,” Sanders said. “Secretary Clinton is wrong. Shadow banks did gamble recklessly, but where did that money come from? It came from the federally insured bank deposits of big commercial banks—something that would have been banned under the Glass-Steagall Act.”
Moreover, Sanders said his work as a senator revealed that the Federal Reserve and the Treasury Department “provided more than $16 trillion in short-term, low-interest loans to every major financial institution in the country” to stop the global economy from imploding after the 2008 crash. “Secretary Clinton says we just need to impose a few more fees and regulations on the financial industry. I disagree.”
4. End Too-Big-to-Jail
Sanders said that the government needs to run Wall Street, not the other way around, which he said is the reality today. He said that “equal justice under the law” means that banking and finance executives whose reckless gambles damaged people’s lives must face real criminal penalties including prison.
“The average American sees kids being arrested and sometimes even jailed for possessing marijuana or other minor crimes,” Sanders said. “But when it comes to Wall Street executives, some of the wealthiest and most powerful people in this country, whose illegal behavior caused pain and suffering for millions—somehow, nothing happens to them. No police record. No jail time. No justice.”
He noted that “not one major Wall Street executive has been prosecuted for causing the near collapse of our entire economy” and that “will change under my administration.”
What Sanders doesn’t mention is that large banks also have been caught engaging in drug money laundering for the Mexican banks. The US government has fined the banks, but never indicted any bank officers, not even when the banks have been caught committing this crime time and again.
5. Criminalize Wall Street’s Business Model
One of Sanders’ most incisive comments concerned Wall Street’s ways of doing business, which he said are based on intentionally ripping off average Americans and engaging in all kinds of unethical and illegal behaviors. He said the government must do more to penalize companies that routinely rip off the public and richly reward the executives overseeing that process.
“The reality is that fraud is the business model on Wall Street,” Sanders said. “It is not the exception to the rule. It is the rule. And in a weak regulatory climate the likelihood is that Wall Street gets away with a lot more illegal behavior than we know of. How many times have we heard the myth that what Wall Street did may have been wrong but it wasn’t illegal? Let me help shatter that myth today.”
Sanders read from a dozen business page headlines to underscore that the banks most Americans use have been fined $204 billion since 2009 for malfeasance. “And that takes place in a weak regulatory climate,” he said. “And, when I say that the business model of Wall Street is fraud, that is not just Bernie Sanders talking. That is what financial executives told the University of Notre Dame in a study on the ethics of the financial services industry last year.”
Sanders said he would appoint regulators who are not afraid to tackle this caldron of corruption. “I will nominate and appoint people with a track record of standing up to power, rather than those who have made millions defending Wall Street CEOs. Goldman Sachs and other Wall Street banks will not be represented in my administration,” like they will be in a Clinton, Trump, or any other Republican administration.
6. Tax the Casino Culture
Sanders said one of the keys of reforming Wall Street was ending its culture of financial speculation. He said he would do that by imposing a transaction tax aimed at high-speed, high-volume traders who are not investing “in the job-creating economy.” Those funds would then be used for cutting the cost of higher education. This was something first proposed in The Rigged Game: Corporate America and a People Betrayed.
“We will use the revenue from this tax to make public colleges and universities tuition-free. During the financial crisis, the middle class of this country bailed out Wall Street. Now, it’s Wall Street’s turn to help the middle class.”
7. Reform the Financial Rating Agencies
Sander’s notes that the ratings agencies committed fraud when it came to rating mortgage backed bonds. If the investment banks didn’t like the ratings of the liar loans they were purchasing from, say, Country Wide, then they simply went to a different ratings agency. For the ratings agencies, it’s either fraud or bust. This must end.
8. Cap Credit Card Interest and ATM Fees
Sanders doesn’t mention that just as there are tens of trillions of dollars of mortgage backed bonds issued by Wall Street Investment firms, such as JP Morgan and Goldman Sachs, the credit card debt backed bond market is a billion dollar industry. Capping interest rates charged by banks and credit card companies, and curtailing some of their fees, will bring the full might of an enraged banking/investing industry down around Sanders neck because what he proposes will undercut the value of credit card backed bonds, which is a trillion dollar plus industry. Sanders proposals might even send the value of the bonds to zero, which would be a good thing for the 99 percent, but a bad thing for the idle rich and their unearned income stolen from the 99 percent.
Sanders says banks and credit card companies must stop “from ripping off the American people by charging sky-high interest rates and outrageous fees. It is unacceptable that Americans are paying a $4 or $5 fee each time they go to the ATM. It is unacceptable that millions of Americans are paying credit card interest rates of 20 or 30 percent.”
Sanders wants interest rates “capped at no more than 15 percent for borrowed money. He also said ATM fees should be capped at $2. “People should not have to pay a 10 percent fee for withdrawing $40 of their own money out of an ATM. Big banks need to stop acting like loan sharks and start acting like responsible lenders.”
9. Let the USPS Offer Banking
The post office’s money order service could be greatly expanded “to give Americans affordable banking options,” Sanders said. “The reality is that, unbelievably, millions of low-income Americans live in communities where there are no normal banking services.”
“Today, if you live in a low-income community and you need to cash a check or get a loan to pay for a car repair or a medical emergency, where do you go?” he asked. “You go to a payday lender who could charge an interest rate of more than 300 percent and trap you into a vicious cycle of debt. That is unacceptable.”
10. Reform the Federal Reserve
Sanders said this arcame institution that regulates the flow of the U.S. currency and interest rates charges to banks must be reformed so that its primary purpose is serving the public, not private bankers. “When Wall Street was on the verge of collapse, the Federal Reserve acted with a fierce sense of urgency to save the financial system,” he said. “We need the Fed to act with the same boldness to combat unemployment and low wages.” What Sanders doesn’t mention is that the Federal Reserve is a private bank, and not a government agency. It’s primary goal is to ensure that the big banks are solvent and their profits and stock prices are rising, even at the expense of the American people.
“It is unacceptable that the Federal Reserve has been hijacked by the very bankers it is in charge of regulating,” Sanders said. “I think the American people would be shocked to learn that Jamie Dimon, the CEO of JPMorgan Chase, served on the board of the New York Fed at the same time that his bank received a $391 billion bailout from the Federal Reserve. That is a clear conflict of interest that I would ban as president. When I am elected, the foxes will no longer be guarding the henhouse at the Fed.”
As striking as Sanders’ reforms sound, he said they were unlikely to be sufficient to ensure that American capitalist excesses do not harm the country again.
“No president, not Bernie Sanders or anyone else, can effectively address the economic crises facing the working families of this country alone,” he said. “The truth is that Wall Street, corporate America, the corporate media and wealthy campaign donors are just too powerful.”
But Sanders said that new rules of the financial game could be written and that government could force Wall Street to follow them.
“Yes, we can make our economy work for all Americans,” he said. “And so my message to you today is straightforward: If elected president, I will rein in Wall Street so they can’t crash our economy again. Will they like me? No. Will they begin to play by the rules if I’m president? You better believe it.”
The Rigged Game: Corporate America and A People Betrayed
The Rigged Game: Corporate America and a People Betrayed
Wall Street is up to no good, and has been since 1980, when it took over the Republican Party, and then the Democratic Party in 1994. Income has been massively redistributed from the 99 to the 1 percent via legislative scam after scam, from tax cuts for the rich to international income redistribution schemes falsely labeled as trade agreements. In The Rigged Game, John Hively exposes how this has all come about starting with a revolutionary, but simple reality, all recessions begin in the financial markets.
John Hively's Blog: News and Analysis of the War Against the Middle Class 