For a long time, Apple successfully built up an image as the good guys, cool and hip compared to the stodgy and evil Microsoft IBM, beginning with its classic ‘1984’ ad that aired during the Super Bowl of that year
The problem of the big banks is becoming acute, as was made clear by Neil Barofsky in his excellent book Bailout: How Washington Abandoned Main Street While Rescuing Wall Street that I reviewed here. While having banks that are too big to jail makes a mockery of the legal system by inviting corruption, there is another reason that they are bad and that is because when some banks are perceived as too big to fail/jail, then they are being implicitly guaranteed by the US government, that it will step in and rescue them if they get in trouble. That means that people feel as safe lending money to them as they feel with buying US Treasury bonds and this carries with it real costs. [Read more…]
Economist Jeffrey Sachs is professor of Health Policy and Management and Director of The Earth Institute at Columbia University. He used to be one of your standard establishment types. As recently as 2006, he wrote a book The End of Poverty: Economic Possibilities for Our Time that I read in which he promoted the neoliberal ideology of the policies that developing countries should adopt. He was a major player on the international scene, a widely sought-after and quoted advisor to governments, the World Bank, the IMF, and the like. [Read more…]
The rules against insider trading are meant to ensure that ‘the market’ is democratic and that everyone has access to the same information on which to base investment decisions, and to prevent individuals from taking advantage of knowledge that might give them more accurate knowledge of the true value of something than the public at large. As a result, we are constantly reassured how ‘the market’ has a self-correcting mechanism that results in the publicly stated value of financial products reflecting their true value. [Read more…]
I recently read Bailout: How Washington Abandoned Main Street While Rescuing Wall Street by Neil Barofsky and it was a gripping read. His book is an insider’s account of how the financial crisis of 2008 was handled in Washington DC and it is not a pretty sight. [Read more…]
I wrote before about the faulty analysis by two Harvard economists Carmen Reinhart and Kenneth Rogoff that asserted that when the debt-to-GDP ratio reached a critical point of 90% in a country, the rate of economic growth took a nose-dive and went into negative territory. This analysis was used to spook policymakers, especially in the US and Europe, that bringing deficits under control was the most urgent priority, and that taking measures to stimulate growth and create jobs was the wrong approach. Governments went on an austerity spree, resulting in many people being thrown out of work and social services cut, casuing immense hardship. [Read more…]
Debt cutting frenzy has been rampant across North America and Europe, with ‘everyone’ (i.e., politicians, elite media, and the oligarchs) arguing that if the deficits are not reduced by cutting spending on social services, countries risk ruin. This phony consensus has been driven by pseudo-grassroots campaigns like ‘Fix the Debt’ and the Simpson-Bowles ‘Catfood Commission’, while standing in the shadows and pushing this agenda is billionaire Pete Peterson who has poured half a billion dollars into trying to cut Social Security, Medicare, Medicaid, and other social programs. [Read more…]
In his search for a ‘grand bargain’ on the budget, president Obama has repeatedly signaled his willingness to cut earned benefits such as Social Security, a long-standing goal of the oligarchy. The way it is proposed is to replace the current Consumer Price Index or CPI, the current way of measuring the rate of inflation, with something called the ‘chained CPI‘, which would have the effect of lowering the reported rate of inflation. This is important because Social Security payments (as well as disabled veterans benefits and food stamps) are tied to the rate of inflation so lowering the ‘official’ rate would result in reduced payments to all those groups. [Read more…]
I came across this article that said that rich people gave money to charities differently from the middle class and the poor. One difference was to whom they gave money. “The poor tend to give to religious organizations and social-service charities, while the wealthy prefer to support colleges and universities, arts organizations, and museums.” [Read more…]
As was to be expected, a deal has emerged over the weekend to deal with the demand by the European Central Bank that Cyprus needs to come up with 5.8 billion euros or risk going bankrupt. [Read more…]