Not content with focusing public ire on those social spongers who have the temerity to be unemployed or disabled, government has scored a great populist coup, and caused great rejoicing in the land of the tabloids, by decreeing that it is quite acceptable to kill burglars with machine guns, rocket propelled grenade launchers, tactical nuclear weapons or any of the other items the British householder keeps by them for such an emergency.
But if a burglar were to strip my home of its entire contents, it would not reach a tenth in value of the money that is going to be taken from me in taxation by government for the rest of my life to fund the bank bailouts in which my cash was given to reckless and incompetent bankers to cover their gambling losses.
Not only have they taken all my money, the majority of the money I shall be paying to cover it for the rest of my life, will consist of interest to the bankers because the government borrowed at interest from the bankers the money it then gave gratis to the bankers to bail them out.
And, as doubtless you will have noticed, nothing changed. No reduction in massive salaries and bonuses, no split of casino from high street banking, no transaction tax to deter multiple speculative trades. A million more unemployed, but none of them investment bankers – they have however sacked over a hundred thousand mostly female staff from their high street branches, which were the only sensible and profitable bit of the operation. No bankers in jail, not even for LIBOR fraud. Quantitive Easing, or printed money, is given not for infrastructure projects to produce growth, but given to banks to improve their liquidity. They do not lend it on to companies but pay it to themselves, as bonuses.
Forget burglars. Shoot a banker.
‘Great post Craig, except for capitulating to the new spelling of gaol’
Gaol or Jail?
Both are correct:
The word came into English in two forms, jaiole from Old French and gayole from Anglo-Norman French gaole (surviving in the spelling gaol), originally pronounced with a hard g, as in goat
http://oxforddictionaries.com/definition/english/jail
The important thing is to put the bankers in one.
Or bring back another great Old Englishe institution: the stocks.
Craig – shooting is definitely tempting, but for anyone that isn’t already aware of it, I also strongly recommend checking out http://www.positivemoney.org.uk for an easy-to-grasp analysis of the roots of the banking problem, and what to do about it.
“I wouldn’t condone killing anyone, banker, burglar or otherwise.”
Yeah, not now perhaps but that can soon change.
[Mod/Jon: posted as Apple Pies, but has posted in the past under Ginger Nuts, so fixing]
http://4.bp.blogspot.com/-862LXLJ7HeA/Tp808kJC5FI/AAAAAAAAAMs/Tns7exJogFo/s320/gibbet.gif
The LIBOR fraud, truly spectacular in scale, was perfectly legal. Yet another example of a crime committed by the well connected being considered not a crime at all. I’m afraid we might have to shoot the law makers too.
And who was on watch to “protect” the nation from the spivs and charlatans who ruined the UK economy and placed us all into abject debt? None other than Howard Davies:
http://en.wikipedia.org/wiki/Howard_Davies_(economist)
Davies was head of the FSA at exactly the time when the city was first let loose on a rampage of ponzi schemes, dodgy financial instruments, liar loans, toxic credit and awarding themselves huge salaries. Having sat on his hands until 2003 he ensured the FSA was fully primed in its utter failure to curtail city excess, and went on to head that supplier of academics in support of the bankers’ “step on everyone” charter, The LSE, where he distinguished himself by accepting donations from Libya via Gaddafi’s son after which he quietly resigned.
His whole life has been spent wandering around the inner circle of corporate clubs whose members do the rounds of banking, then “regulation”, then banking again, then educational institutions, then a spot of banking yet again. At each stop Davies either achieved nothing or worse, screwed things up. This perpetual round robin of executive posts is something Davies has particularly excelled at. At no time in his entire career has Davies ever produced anything that any intelligent person could consider useful or of value.
Once a member of the corporate rent-a-spiv society, it doesn’t matter whether you are a complete failure, you are in the charmed circle and your entire career is a relentless acquisition of blue chip posts, none of which are of the slightest import or use.
In an almost kafkaesque twist, Howard Davies actually went on a lecture tour lately (including South Africa) advising institutions about financial regulation!
Davies is just one example within the excrable cabal of failed academics and city slickers, retired judges, Lords, retired Civil Servants, advisers and a host of other quite useless hangers-on, few of whom have done an honest day’s work in their lives, who spend the autumn of their existence moving from one pointless, but highly rewarded, post to another. Here is a summary of his main “achievements”:
Deputy Governor Bank of England 1995-1997
Chairman Financial Services Authority 1997-2003 (or is that Freedom for Spivs Authority?)
Director LSE 2003-2011 (resigned for accepting case from Gaddafi)
Adviser to chancellor exchequer (Lawson)
On the board of Paternoster consultants (Goldman Sachs owned)
Director Morgan Stanley
The Morgan Stanley link is of particular interest. This vast corporation is one of the most censured, most prosecuted corporations in existence in the US, having had fines in excess of 100 million dollars levied upon it while Davies was a director, for misrepresenting securities, excessive bond fees and commissions, negligence in servicing domestic mortgages, failure to disclose research in breach of disclosure regulations, multiple instances of insider trading, fictitious sales of Eurodollar and treasury futures and so on The list is long.
And this outcome from supposed ex-financial regulator.
There are many many more examples of “doing the rounds” of institutions by a circus of incompetent, unaccountable, highly paid and ghastly individuals. Davies is just one of them. Anymore?
I have no doubt that the continued fraud by the financial institutions backed by those in Parliament is tantamount to Treason.
This trouble with fat cats who do too well is endemic in our chosen (or evolved) system of free enterprise capitalism. While it is very satisfying to write of hanging people, putting them up against a wall, purging society of parasites, etc. etc., it isn’t constructive. If you did that, after the party things would in fact go right downhill as we actually need some really selfish, energetic, ruthless people to drive the economy forward. Let’s face it, most of us are far too reasonable and sane to drive progress. We rely on those who are, for whatever reason, mentally warped enough to be under a compulsion to outdo others.
.
Abraham Lincoln, as so often, summed things up neatly when he said that “Statesmanship is the art of exploiting individual meannesses for the general good”. In the mental picture this conjures up, bankers and captains of industry are like so many donkeys harnessed to a great wheel that moves the economy, always straining forward to reach the carrots that are forever just out of reach. Lincoln knew perfectly well that human nature is deeply flawed, and that we all have character weaknesses that make us selfish and inconsiderate. Nothing abashed, he set about finding how to align those selfish motives into a grand Newtonian vector sum whose resultant pointed upwards – for us all.
.
Unfortunately, statesmen in the Lincolnian sense are few and far between. People like Blair, Brown, Cameron, and Clegg cannot tweak the laws in such a way as to force bankers, willy-nilly, to contribute to the common good. Contrariwise, the bankers have infiltrated the corridors of power and are progressively reshaping the law to suit their own convenience. There they recline, amid a heap of luscious juicy carrots, gorging themselves while the wheels of the economy lie idle.
.
If only there were a way to divorce wealth from power. In the free, open, democratic, globalized world we have created, anyone with enough money can exert power. That power gives access to more wealth, which accretes more power… in a positive feedback loop.
Not to worry. Price Waterhouse Cooper will detect any suspicious dealings and take effective action…
http://www.dailykos.com/story/2012/09/27/1136928/-Romney-s-Accounting-Firm-PwC-Has-HUGE-History-of-FRAUD
The Big Four audit firms—Deloitte & Touche, Ernst & Young, KPMG and
PricewaterhouseCoopers (PwC)—audit all but one of the FTSE 100 companies, and
represent 99% of audit fees in the FTSE 350.
(Competition and choice in the UK audit market
Prepared for Department of Trade and Industry and Financial Reporting Council, April 2006)
arf.
No, don’t shoot them or gaol them. Make them pay it back as community service on minimum wage. They’d be done in a few centuries.
Alternatively, the entire City of London should be entombed in a concrete sarcophagus, like Chernobyl.
I’m glad you’ve brought up this topic, Craig, and I predict a very lively reaction from the forum. I would only quibble with this bit:
I would say there was nothing reckless or incompetent about their actions, they knew exactly what they were doing, i.e. deliberately manufacturing financial crises which result in them ….
(a) being given huge sums of money
(b) configure the global economy to suit their long term purposes.
(c) further their long term policy of sickening people with the actions of irresponsible national banks so that we demand a “supervised” global bank.
These bankers don’t gamble.
@Tom Welsh: “While it is very satisfying to write of hanging people, putting them up against a wall, purging society of parasites, etc. etc., it isn’t constructive. If you did that, after the party things would in fact go right downhill as we actually need some really selfish, energetic, ruthless people to drive the economy forward.”
This is exactly the kind of twisted understanding that allows those very bankers and corporate spivs to ruin economies. Far from constructively building economies or trade that is to the benefit of the electorate, the vast majority of those “ruthless” people you speak of do not create anything, do not invent anything and do not add to a nation’s growth or GDP. In the main, these people dominate a market, monopolise, asset-strip, inflate values artificially then sell, manipulate, con, deal in questionable instruments and dodgy non-assets, hide debts, miss-sell, defraud, cook the books, reside in tax havens, and almost everything they do is nothing whatever to the common good and everything to do with their own inflated sense of entitlement.
That is why, when the mainstream media present programmes about the economy, real people who work for a living, real engineers, real companies who actually PRODUCE things that others find useful, are never invited on. Instead they wheel on failed bankers, failed economists, share manipulators, spivs, failed regulators, columnists, city slickers and a sundry mix of charlatans who do nothing whatever in pursuit of proper growth in the economy.
These people you apparently think are the real drivers of economies are in fact the very people who spend their whole life doing nothing more than slicing up large cake slices for themselves, and the odd thing is that you acknowledge that in your second paragraph but imply the exact opposite in your first.
The flaw in your argument is that being reasonable and sane cannot drive progress. The opposite is the case, and that is palpable since those ruthless people you feel are regretfully necessary HAVE just ruined the economies of half the nations of Europe!
How the Financial Lobbyists Carried the Day
The Bankers vs. The People
by MIKE WHITNEY
Last Thursday, the Wall Street Journal ran an article titled “Burdened by Old Mortgages, Banks Are Slow to Lend Now“, in which, author Nick Timiraos said that the reason that housing has been so slow to recover is because Fannie and Freddie “have been forcing banks to take back an increasing number of loans that the banks made during the boom years.” According to Timiraos, the banks have “grown wary of making new loans” and “are ratcheting up credit and documentation standards for new mortgages.”
From the WSJ:
“Mortgage credit is tighter than it should be,” said Treasury Secretary Timothy Geithner at a Senate hearing in July. “And the main reason for that is because banks…feel much more vulnerable now to what people call ‘put-back.’ ”
This play-it-safe stance by banks threatens to undercut the Federal Reserve’s latest effort to push down mortgage rates by buying up mortgage-backed securities. Even if rates keep falling, many people will find it much harder to take advantage.”
Timiraos does have a point. Certainly housing and the overall economy would be doing better if credit was expanding at a brisker pace. But does that mean the banks should ease lending standards again like they did before the meltdown? And, does that mean the banks shouldn’t be held accountable for the bad loans they made? Timiraos seems to think so. Take a look:
/..
http://www.counterpunch.org/2012/10/10/the-bankers-vs-the-people/
I vote for Craig for PM
Even here, there seem to be those who define ‘progress’ as ‘economic growth’.
Anyone who believes in infinite growth on a finite planet is either an economist or insane.
Did someone say “real people who work for a living, real engineers, real companies who actually PRODUCE things that others find useful,”?
https://docs.google.com/spreadsheet/ccc?key=0Al1Cy1H3n8gpdElTeFBTVlRfclczQnpjVWREYkN4N1E#gid=0
I don’t think the Government knows about them.
Mary: Your quote about “housing being so slow to recover” is a common one. I realise that is not perhaps your own view. But what is meant by “recovery”? Does it mean the recovery of past inflated prices? (I suspect it does). Or does it mean an increase in house sale transactions?
Whatever it means, the conventional wisdom on the “housing market” is nearly always predicated on house prices, and specifically HIGH prices, as the yardstick of recovery. In fact the exact oppposite is the case, since as long as any economy is fundamentally reliant on the perceived value of static assets, then investment in proper growth is stalled. In fact no amount of lending, and no amount of “affordable” housing is really going to make houses truly affordable, unless the capital cost of ALL housing declines.
All the political parties are aligned in being utterly paranoid about upsetting EXISTING house owners, and that translates to keeping interest rates absurdly low in order for those owners to continue their illusion that their houses really are worth perhaps double what they should be.
The only way to solve this is to do the pole opposite of what is happening now, and that is to stop house price inflation for good, by raising interest rates a modest amount in order to head off any more house price inflation and make proper investment in REAL things that are worthwhile. Instead we are hung up about supporting the unsupportable – ridiculous house values.
The huge mistake between 1997 and 2006 was to make housing almost the SOLE means of making money for many. But an already built house cannot create wealth. It can only create ARTIFICIAL wealth for those who happened to cash in on a bubble. Everyone else PAID for that bubble by having to pay a ludicrously high proportion of disposable income in order to get a roof over their heads. Thus the housing bubble was at its core a re-distribution of wealth from the house-less to the house owners. The illusion that this was a net gain in wealth was the fundamental cause of the entire meltdown of our economy, but astoundingly that illusion still persists today.
The only way to for housing to recover in the true sense of that word, is for house prices to plunge, and the only way to make “affordable” housing is not to build isolated so-called affordable housing (which just means poky homes on cheap estates subsidised by the tax payer), but to lower the capital cost of ALL housing and stop house price speculation for good.
There are four distinct ways to do this:
1. Raise interest rates to encourage prices to go down and to encourage investment in REAL industry.
2. Penalise those who persistently make a living from speculating in property.
3. Learn from the German housing model of the 1990s and 2000s. ie: no distinction in social status between renting and “owning” (parenthesis because very few ever “own” a house since they are renting it via a mortgage from a bank). Plentiful rented sector, fairly provided at a reasonable cost and with tenancies of at least one year (not our ridiculous six months – see Thatcher). Result: very little house price inflation.
4. Stop the diversion of investment funds away from speculative gambling and towards proper investment in infrastructure and goods and services that actually add to GDP, not steal from it.
Max Keiser on BBC Daily Politics right now!
The mechanism for rationalising the housing sector (and any other loan- fuelled “asset” market) is, as George mentioned above, to prevent private enterprise from creating notional money to balance its loan books.
Again: good site, sensible and informed thinking -http://www.positivemoney.org.uk
As opposed to the current efforts to reinflate the old bubble so that the usual suspects can continue charging rent on rent on rent on someone else’s money which never represented real value in the first place.
@Pan,
“Anyone who believes in infinite growth on a finite planet is either an economist or insane.”
Or both?
Hello craig and your readers,
Your article `establishment darkness` was very interesting and for me shocking, thanks to all the people who posted comments and links it was an education and a revelation.
As for the bankers, the politicians and other people in positions of power who enable and benefit from their activities they will never see a rope, or any sort of justice. i find the great majority of people in london, to be self absorbed, self obsessed and wilfully ignorant, at every level, this seems to be the new normal. it seems as though people have regressed in every sense. so many people live by the mantra of im alright jack f**k you. when disorder breaks out it will not be directed at those responsible. neighbourhoods will turn against themselves along lines of race, wealth, religion etc.
First of all i think people need to stand back and evaluate, truthfully and ruthlessly their own complicity in the creation of the situation we find ourselves in, no one is innocent. how many of you benefitted from the housing boom trading up property and the like, how many of you gladly embrace and indulge yourselves in consumerism, how many iphone or ipad users think of the slave worker who manufactured that device while you`re using it, how many of you wonder where it goes when you`ve finished with it ie the beautiful countryside and beaches of ghana for instance.
ie which ones of you truthfully and in a practical sense give a sh1t when viewed through a harsh lens?
A few years ago in another capacity i met many people who work for the press, tv, plc`s government etc and generally i was not impressed, the greed, self righteousness etc of the bankers et al is reflected by the majority of people on an individual level.
Im sorry but publications like the guardian, the independent (from what?), programmes like newsnight etc etc are of the swamp, with very little to be offered in mitigation.
Saying that you would kill a banker i take as largely metaphorical, and sadly glib. they are just the top of a pyramid that is underpinned by a great many others, including myself and all of you.
When the shtf it will largely be the youth who do the hands on rioting as i did when in my 20`s over the poll tax, mob disorder will solve nothing merely strengthen the hand of tptb. its the responsibility of intelligent, reasonable and truthful people to take this society in a positive direction, and that includes each and every reader of this blog, the change starts with you.
A previous glimmer of hope in this realm was the green party back in the late 80`s-90`s but it soon became clear that right-on-ness and liberal drivel crippled it at the start line. as in life in general many people have a secret axe to grind, are dogmatic and seek to suppress truths they dont like, or are contrary to their agenda.
I could go on but i wont i hope you get the jist of what im saying.
Please visit these sites amongst others to inform yourself and others with ears to listen,
RT putins propaganda channel yes, but they dont need to make it up just shout the truth loudly and repeatedly
Max Keiser
Marketoracle
Bill Bonner on dailyreckoning.com.au
Zerohedge
Alt. market
The Burning Platform
Chris Hedges column on truthdig
A very interesting documentary about history of banking – http://www.youtube.com/watch?v=H56FUHgqRNE
To name but a few
etc
Meanwhile, who will shoot the Uzbeki regime henchmen? On 6th of October last weekend an 18 year old Navruz Islamov was beaten to death by uzbek police in Kashkadarya region for refusing to pick cotton due to health reasons. It was saturday and Navruz went to go to cotton fields for his mother to pick cotton for her who is a teacher and must pick certain amount of cotton(In Uzbekistan you don’t have weekend day offs). It was a hot day and after working a while Navruz felt unwell, he wanted to go home. However, uzbek police, like nazi wardens during WW2, were watching people in cotton fields. They beat up Navruz so badly for refusing to return to cotton fields he died on the way to hospital. Nobody talks about such atrocities in Uzbekistan, because Uzbeki henchmen are friends of America and Britain. Shame on anyone who is proud to be british or american!
UK pays £400million/Each day in INTEREST on its debt.
How did RBS get that £1.3 trillion hole in its balance sheet?
10 years it went from assets on £88 billion to liabilities of £1.3 trillion. these losses belong to the tax payer.
@Gary Smith – You are right.
In a nutshell, changing the world begins with changing oneself.
An interesting exercise:
Walk down your local High Street and count the businesses which can still afford town centre rates and prestigious buildings. Total up the ones that deal in money – banks, building societies, currency exchanges, pay day loaners, insurance companies, investment brokers, pawn brokers, cheque cashers, gold buyers, cash converters, etc. Now total up all the rest.
Hmmm.
Why do government feel the need to save banks, for example northern rock had 2 billion in deposits and 110 billion in mortgages, if it went bust, 2 billion would be lost in deposits and 110 billion would get wiped out in mortgages, the government the can then ask the mortgage holders if they can repay 2% of their mortgage to clear the amount, and give that money to the depositors, problem solved, don’t see how this would require massive billion pound bailouts,
In PARLIAMENT this Wednesday, the MP for Clacton, Douglas Carswell, with support from my co-director here at the Cobden Centre, Steve Baker, the Member for Wycombe, introduced a Ten Minute Rule Bill seeking dramatic reform of the UK’s banks, writes Toby Baxendale.
The bill was brought in with no objections, and the next reading will be on the 19th of November. You can read the full text of Carswell’s speech at TheyWorkForYou. Steve Baker has been promoting its ideas on his CentreRight blog, which also carries a survey – conducted on our behalf by ICM – showing great confusion on the part of the British public concerning the legal relationship between banker and customer.
The current state of the law? The key case is Carr v Carr 1811 (reported in Merivale (541 n) 1815 – 17). A testator in making his bequest said “whatever debts might be due to him…at the time of his death”, the key question in this case being whether “a cash balance due to him on his banker’s account” passed by this bequest. The Master of the Rolls, Sir William Grant held that it did. He reasoned that it was not a depositum; a sealed bag of money could be, but this generally deposited money could not possibly have an ‘earmark’.
In judgment, the Lord Chancellor Cottenham said the following:
“Money, when paid into a bank, ceases altogether to be the money of the principal; it is by then the money of the banker, who is bound to return an equivalent by paying a similar sum to that deposited with him when he is asked for it.
“The money paid into a banker’s is money known by the principal to be placed there for the purpose of being under the control of the banker; it is then the banker’s money; he is known to deal with it as his own; he makes what profit of it he can, which profit he retains to himself, paying back only the principal, according to the custom of bankers in some places, or the principal and a small rate of interest, according to the custom of bankers in other places.
“The money placed in custody of a banker is, to all intents and purposes, the money of the banker, to do with it as he pleases; he is guilty of no breach of trust in employing it; he is not answerable to the principal if he puts it into jeopardy, if he engages in a hazardous speculation; he is not bound to keep it or deal with it as the property of his principal; but he is, of course, answerable for the amount, because he has contracted, having received that money, to repay to the principal, when demanded, a sum equivalent to that paid into his hands.
“That has been the subject of discussion in various cases, and that has been established to be the relative situation of banker and customer. That being established to be the relative situations of banker and customer, the banker is not an agent or factor, but he is a debtor.”
Thus the settled position of the law is that when you deposit, the bank becomes the owner of the money deposited and you become a creditor to the bank.
The Carswell Bill, in contrast, seeks to align the law with what people actually think happens: that they deposit money and it is theirs. It also seeks to allow savers to save in a term deposit, by which they knowingly and indeed willingly allow the bank to lend their money to borrowers. This relationship will then be that of a depositor lending to the bank and the bank being the debtor to the lender.
Hang the bankers? Sure, go for it! (I don’t think anyone would doubt the outcome of a national referendum based on the question “Should those responsible for the ‘financial crisis’ be prosecuted?”)
Having said that, I see evidence of the general public’s complicity in this culture of greed every time I pass a lottery ticket stall – more often than not, there is a long queue of people with a certain kind of look on their faces – a kind of suppressed but visible anxiousness (Will I win this time?).
We have become a nation of gamblers. And most gamblers are losers (ask any casino/betting shop worker)!
I have never bought a lottery ticket myself, not because I couldn’t use the money if I won, but because I find the whole thing repulsive and I just don’t want to participate in it. The repulsion I feel towards the national lottery (and all its spin-offs) is much stronger than the occasional frustration I feel when I can’t afford something I want/need.
I suspect that a majority of ‘ordinary’ people, given the chance to pay themselves huge annual bonuses (like corporate CEOs) would do so. So how different would those ‘ordinary’ people then be, from the criminal bankers? And how different are they now? The only difference is one of opportunity!
@LeonardYoung
Thanks for that comment re: housing market, that strikes me as a very clear-sighted analysis.