Bankers versus people .the future of democracy

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Bankers versus people .the future of democracy

  1. 1. BankersversusPeopleThe Future of Democracy
  2. 2. S&P index drops by 7.1% on 23rd Sept 2011.Biggest fall since the crash of Sept 2008
  3. 3. $10 Trillion + pumped inglobally to save the ‘Big Banks’
  4. 4. NOhttp://www.guardian.co.uk/business/2011/jul/29/us-economic-growth-slows-down-sharply
  5. 5. NO
  6. 6. So what did it do?
  7. 7. It empowered Wall Street Banks andhedge funds to grab commodities!
  8. 8. http://af.reuters.com/article/commoditiesNews/idAFN1E77A0E820110811
  9. 9. http://www.guardian.co.uk/business/2010/nov/05/wholesale-food-prices-soar
  10. 10. Texas crude rose by 22% and copper by 26%
  11. 11. http://www.forbes.com/sites/greatspeculations/2011/07/08/metal-warehousing-pays-off-for-goldman-sachs/
  12. 12. The big question.Did Fed action help the average citizen?
  13. 13. http://uk.reuters.com/article/2011/09/14/uk-usa-economy-poverty-idUKTRE78C45220110914
  14. 14. Income disparity between Bankers & the rest grew rapidly.
  15. 15. The Gini’s disparity index for US rose to45, much higher than UK 34 or even India36.8
  16. 16. http://blogs.wsj.com/marketbeat/2010/02/01/are-greek-bonds-the-new-subprime/
  17. 17. http://online.wsj.com/article/SB10001424052970204479504576634933293244342.html
  18. 18. Fed pumped in liquiditywhen Banks were sick When Greece, Spain, Portugal became sick IMF,ECB squeezed out liquidity …… Why ?
  19. 19. As a result http://www.guardian.co.uk/business/2010/j an/03/credit-crunch-iceland-ireland-greece- dubai-spain
  20. 20. http://www.guardian.co.uk/world/blog/2011/oct/16/stoical-spanish-soul-hardship
  21. 21. •As growth suffered and cashdisappeared from the market, defaultlooked imminent. http://www.nytimes.com/roomfordebate/20 11/10/10/is-europe-sliding-into-a-double- dip-recession
  22. 22. ….. And the distress investment specialists likeWilbur Ross, Mark Mobius and George Soros
  23. 23. They downgrade credit rating oftenprematurely. Raise borrowing costsand make debt recycling difficult. http://www.bbc.co.uk/news/business- 15222803
  24. 24. http://www.bloomberg.com/news/2011-02-01/whitney-municipal-bond-apocalypse-is-short-on-default-specifics.html
  25. 25. Finally they are forced to sell offassets for repayment. http://www.guardian.co.uk/business/2010/ mar/04/greece-sell-islands-german-mps
  26. 26. •They each have mammoth assetsover $2 Trillion, ten times that of big oilExxon, Shell or BP.
  27. 27. Joseph Ackerman DeutscheBank CEO and ex-boss of IIFrefused haircuts on Greek loanmore than the agreed 21 %. AndSaid Banks won’t take haircut forany other Eurozone economy. http://www.emergingmarkets.org/Article/2 906503/Banks-rule-out-further-eurozone- debt-haircuts.html
  28. 28. Now that nations struggle……Bankers do not agree thatit is payback time
  29. 29. •Rather, for the Banks the Eurozone crisisprovides opportunities to strengthen theirportfolio by buying into distressed assets. http://www.time.com/time/business/article /0,8599,1916998,00.html
  30. 30. http://www.irishtimes.com/newspaper/frontpage/2011/0912/1224303946844.html
  31. 31. It is true that Europe’s democracies have lackedfiscal discipline, but so have Dexia and Max bank,BOA and Wells Fargo.
  32. 32. Vote and coalition politics have oftenmade elected leaders of democraciespamper to populism.
  33. 33. Spain, Ireland, Portugal and Italy, allhave missed the EU Maastricht treaty fiscaldeficit targets by a mile. http://www.guardian.co.uk/business/2011/m ar/11/eurozone-agree-debt-limit-laws- bailout-deal
  34. 34. Greece deficit surged from 4% to 15%on discovery of accounting oversight.
  35. 35. Since debt was 1.7 times GDP it was not possible to fix the Greek debt crisis with short term measures..
  36. 36. Despite knowing this Greece was put on ashort lease with IMF & ECB making no longterm commitment ..
  37. 37. Speculation mounted and Greek debt rating was repeatedly downgraded. http://online.wsj.com/article/SB1000142405. 3111904265504576568693911614726.html
  38. 38. Fund squeeze led to successive years of negative growth making recovery impossible and default imminent.
  39. 39. So the aged Greek pensioner who paid taxes throughout her life has been handed down a hair cut of 40% of her monthly pension to facilitate the repayment of the Banks. http://online.wsj.com/article/BT-CO-. 20110919-704332.html
  40. 40. Now the IMF, the ECB and IIF the banklobby want to manage the economy andvirtually dictate public policy in Greece. http://www.bbc.co.uk/news/world-europe- 15147855
  41. 41. They are not interested that hospitalservices and educators in Greece have notreceived payment for services since 1 year. http://www.guardian.co.uk/world/2011/aug/ 05/greece-healthcare-brink-catastrophe
  42. 42. They are not interested in structuralreforms of the antiquated licensing policyin Greece that throttles competition.
  43. 43. They only want to control the fundflow and the disinvestmentprocess, so that prize assets flow theirway.
  44. 44. It is obvious that Mr. Papandreou willnot be able to stop that
  45. 45. So a big question arises for thedemocracies around the world. http://www.guardian.co.uk/commentisfree/ 2010/feb/14/greece-uk-european-union-euro
  46. 46. Will Banks takeover control if ourelected leaders fail? http://www.guardian.co.uk/business/2011/a ug/11/berlusconis-partners-grow-restive- over-ecbs-prescription-for-italy
  47. 47. If that be so, will the Fed, the ECB, theIIF and the IMF work for the benefit ofthe citizen or only for the Banks?
  48. 48. Prophetic words from US President ThomasJefferson who said that if private Bankscontrolled monetary policy, they would makethe citizen penniless and homeless.
  49. 49. References : Our Blog : Economy to Ecology:Our goal is to help promote clean, safe and better practices in economyand ecology worldwide. BThis presentation is based on my 4th October article in business section ofTechnorati San Francisco http://bit.ly/oZEaWz and a little moresustainable.Kindle Blog Ecothrust ASIN: B0029ZAUAY For non kinwww.ecothrust.blogspot.comOur Blog at What Happens If ? Risk Management blog Economic Times. New Delhi Ifhttp://blogs.economictimes.indiatimes.com/Whathappensif/Follow us a www.twitter.com/ecothrustAcknowledgements:o Google images , flickr photolibrary and other image sources.For any queries or request for download, mail to Sandip Sen For Queries contact : sen.sandip@gmail.com
  50. 50. Will The Arab Youth Revolt Turn Global http://www.slideshare.net/SandipSen/will-arab- youth-revolt-turn-global India’s War on Corruption :The 1st Battle of Lokpal http://www.slideshare.net/SandipSen/indias -war-on-corruption-the-1st-battle-of-lokpal I want to build a 10million dollar businesshttp://www.slideshare.net/SandipSen/i-want-to-build-a-10-million-dollar-business
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  53. 53. What is Carbon ? What is Carbon – ERM-01 http://bit.ly/bjDTl2 Energy Risk Management SeriesEnergy Risk Management Series http://www.slideshare.net/SandipSen/what-is-carbon- ERM 01ERM 01 energy-risk-management-series-erm-01 Countering Peak Oil – ERM-02 http://www.slideshare.net/SandipSen/countering-peak- oil-erm-02 Risk Managing Turbulent Markets BA 41 http://www.slideshare.net/SandipSen/risk- managing-volatile-markets

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