LeftistLord
11th September 2010, 06:51
THE ONLY WAY TO BEAT WALL STREET IS BY OVERTHROWING THE WHOLE CAPITALIST SYSTEM IN USA
source: marxist com
Written by Mick Brooks
Wednesday, 27 January 2010
Banks are paying out huge bonuses to the very same speculators who were responsible for the credit crunch in the first place. Banking is to remain a financial wild west. If we want a financial system that works for the interest of the people we need to get rid of the whole capitalist system
The bankers are celebrating their orgies. Wall Street banks are set to shell out $65bn in bonuses to the speculators who fouled up so spectacularly and brought the credit crunch down on our heads. Some of this largesse will drop into the laps of dealers in the City of London and Canary Wharf. Goldman Sachs alone will lash out $20bn and JP Morgan, Morgan Stanley, Citigroup and Bank of America will stump up another $65bn.
President Obama, goaded by the fury of millions of Americans at the banks gorging themselves on taxpayers’ money, has finally decided to take action against the obscene bonuses currently being paid out. He has proposed a ‘financial crisis responsibility fee,’ in effect a windfall tax on the banks that is intended to reduce the money available to be paid out as bonuses. Tough action at last?
Obama’s argument seems eminently reasonable. As a result of the banking crisis that broke out in 2007 the US government was forced to step in with a Troubled Asset Recovery Programme (Tarp). Taxpayers shelled out $90bn to save the banks’ miserable hides from their own irresponsibility by buying toxic assets that the banks had bought and storing them in the financial equivalent of a waste dump. Now the crisis has stabilised, the American people are entitled to get their money back. In effect Uncle Sam acted as an implicit insurer to the financial system. Though the banks are predictably hollering their heads off in mock outrage the Financial Times regards the measure as fair and sensible. Will it do the trick?
Behind all the populist rhetoric, though, the word is that the banks are in the clear. In the Financial Times (12.01.10) Robert Reich (former labor secretary to President Clinton) laments the passing of the Glass-Steagall Act. Passed in the Great Depression as part of Roosevelt’s New Deal, the Act provided federal insurance for ‘safe’ regulated high street banks and gave notice to the buccaneering investment banks that, if they fouled up, nobody would rescue them. Reich does not mention that the Act was repealed in 1999 as a result of a massive campaign by finance capital to gain the ear of his one-time boss, the business-friendly Democrat President Clinton.
As Reich goes on, “Money is powerful. Talk is cheap.” He contrasts, “The widening gap between Wall Street and Main Street - a big bail-out for the former, unemployment for the latter; high profits and giant bonuses for the former, job and wage losses for the latter.” Reich talks the talk, but he has no alternative. The Wall Street Reform and Consumer Protection Act passing through Congress neither reforms the banks nor protects consumers - for instance against foreclosure on their homes. Reich shows that the Act in effect guarantees that the government will always bail the banks out, however stupid or reckless they have been, and at whatever the cost to the rest of us.
Banking is to remain a financial wild west, but one with a difference. The Colts will only shoot paint balls. No banker will ever get hurt. The banks are sacrosanct because they are the beating heart of the capitalist system. If we want a financial system that works for us, and doesn’t blow up in our faces, then we need to get rid of the whole capitalist system.
.
.
source: marxist com
Written by Mick Brooks
Wednesday, 27 January 2010
Banks are paying out huge bonuses to the very same speculators who were responsible for the credit crunch in the first place. Banking is to remain a financial wild west. If we want a financial system that works for the interest of the people we need to get rid of the whole capitalist system
The bankers are celebrating their orgies. Wall Street banks are set to shell out $65bn in bonuses to the speculators who fouled up so spectacularly and brought the credit crunch down on our heads. Some of this largesse will drop into the laps of dealers in the City of London and Canary Wharf. Goldman Sachs alone will lash out $20bn and JP Morgan, Morgan Stanley, Citigroup and Bank of America will stump up another $65bn.
President Obama, goaded by the fury of millions of Americans at the banks gorging themselves on taxpayers’ money, has finally decided to take action against the obscene bonuses currently being paid out. He has proposed a ‘financial crisis responsibility fee,’ in effect a windfall tax on the banks that is intended to reduce the money available to be paid out as bonuses. Tough action at last?
Obama’s argument seems eminently reasonable. As a result of the banking crisis that broke out in 2007 the US government was forced to step in with a Troubled Asset Recovery Programme (Tarp). Taxpayers shelled out $90bn to save the banks’ miserable hides from their own irresponsibility by buying toxic assets that the banks had bought and storing them in the financial equivalent of a waste dump. Now the crisis has stabilised, the American people are entitled to get their money back. In effect Uncle Sam acted as an implicit insurer to the financial system. Though the banks are predictably hollering their heads off in mock outrage the Financial Times regards the measure as fair and sensible. Will it do the trick?
Behind all the populist rhetoric, though, the word is that the banks are in the clear. In the Financial Times (12.01.10) Robert Reich (former labor secretary to President Clinton) laments the passing of the Glass-Steagall Act. Passed in the Great Depression as part of Roosevelt’s New Deal, the Act provided federal insurance for ‘safe’ regulated high street banks and gave notice to the buccaneering investment banks that, if they fouled up, nobody would rescue them. Reich does not mention that the Act was repealed in 1999 as a result of a massive campaign by finance capital to gain the ear of his one-time boss, the business-friendly Democrat President Clinton.
As Reich goes on, “Money is powerful. Talk is cheap.” He contrasts, “The widening gap between Wall Street and Main Street - a big bail-out for the former, unemployment for the latter; high profits and giant bonuses for the former, job and wage losses for the latter.” Reich talks the talk, but he has no alternative. The Wall Street Reform and Consumer Protection Act passing through Congress neither reforms the banks nor protects consumers - for instance against foreclosure on their homes. Reich shows that the Act in effect guarantees that the government will always bail the banks out, however stupid or reckless they have been, and at whatever the cost to the rest of us.
Banking is to remain a financial wild west, but one with a difference. The Colts will only shoot paint balls. No banker will ever get hurt. The banks are sacrosanct because they are the beating heart of the capitalist system. If we want a financial system that works for us, and doesn’t blow up in our faces, then we need to get rid of the whole capitalist system.
.
.