Posted on September 8, 2014 by Ellen Brown
In an inscrutable move that has alarmed state treasurers, the Federal Reserve, along with the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency, just changed the liquidity requirements for the nation’s largest banks. Municipal bonds, long considered safe liquid investments, have been eliminated from the list of high-quality liquid collateral. assets (HQLA). That means banks that are the largest holders of munis are liable to start dumping them in favor of the Treasuries and corporate bonds that do satisfy the requirement. Continue reading →
Filed under: Ellen Brown Articles/Commentary | Tagged: Basel III, Federal Reserve, municipal bonds, public banking | 34 Comments »
Posted on September 1, 2014 by Ellen Brown
You can always count on Americans to do the right thing, after they’ve tried everything else. —Winston Churchill
When an article appears in Foreign Affairs, the mouthpiece of the policy-setting Council on Foreign Relations, recommending that the Federal Reserve do a money drop directly on the 99%, you know the central bank must be down to its last bullet.
The September/October issue of Foreign Affairs features an article by Mark Blyth and Eric Lonergan titled “Print Less But Transfer More: Why Central Banks Should Give Money Directly To The People.” It’s the sort of thing normally heard only from money reformers and Social Credit enthusiasts far from the mainstream. What’s going on? Continue reading →
Filed under: Ellen Brown Articles/Commentary | Tagged: Federal Reserve, national dividend, public banking, quantitative easing | 86 Comments »
Posted on August 25, 2014 by Ellen Brown
If Argentina were in a high-stakes chess match, the country’s actions this week would be the equivalent of flipping over all the pieces on the board.
– David Dayen, Fiscal Times, August 22, 2014
Argentina is playing hardball with the vulture funds, which have been trying to force it into an involuntary bankruptcy. The vultures are demanding what amounts to a 600% return on bonds bought for pennies on the dollar, defeating a 2005 settlement in which 92% of creditors agreed to accept a 70% haircut on their bonds. A US court has backed the vulture funds; but last week, Argentina sidestepped its jurisdiction by transferring the trustee for payment from Bank of New York Mellon to its own central bank. That play, if approved by the Argentine Congress, will allow the country to continue making payments under its 2005 settlement, avoiding default on the majority of its bonds.
Argentina is already foreclosed from international capital markets, so it doesn’t have much to lose by thwarting the US court system. Similar bold moves by Ecuador and Iceland have left those countries in substantially better shape than Greece, which went along with the agendas of the international financiers. Continue reading →
Filed under: Ellen Brown Articles/Commentary | Tagged: Argentina, public banking, sovereign debt crisis | 35 Comments »
Posted on August 12, 2014 by Ellen Brown
Argentina has now taken the US to The Hague for blocking the country’s 2005 settlement with the bulk of its creditors. The issue underscores the need for an international mechanism for nations to go bankrupt. Better yet would be a sustainable global monetary scheme that avoids the need for sovereign bankruptcy.
Argentina was the richest country in Latin America before decades of neoliberal and IMF-imposed economic policies drowned it in debt. A severe crisis in 2001 plunged it into the largest sovereign debt default in history. In 2005, it renegotiated its debt with most of its creditors at a 70% “haircut.” But the opportunist “vulture funds,” which had bought Argentine debt at distressed prices, held out for 100 cents on the dollar. Continue reading →
Filed under: Ellen Brown Articles/Commentary | Tagged: Argentina, odious debt, public banking, sovereign bankrutpcy | 35 Comments »
Posted on July 25, 2014 by Ellen Brown
One thing to be said for the women now heading the Federal Reserve and the IMF: compared to some of their predecessors, they are refreshingly honest. The Wall Street Journal reported on July 2nd:
Two of the world’s most powerful women of finance sat down for a lengthy discussion Wednesday on the future of monetary policy in a post-crisis world: U.S. Federal Reserve Chairwoman Janet Yellen and International Monetary Fund Managing Director Christine Lagarde. Before a veritable who’s-who in international economics packing the IMF’s largest conference hall, the two covered all the hottest topics in debate among the world’s central bankers, financiers and economists.
Among those hot topics was the runaway shadow banking system, defined by Investopedia as “The financial intermediaries involved in facilitating the creation of credit across the global financial system, but whose members are not subject to regulatory oversight. The shadow banking system also refers to unregulated activities by regulated institutions.” Examples given include hedge funds, derivatives and credit default swaps. Continue reading →
Filed under: Ellen Brown Articles/Commentary | Tagged: LaGarde, public banking, taper, Yellen | 30 Comments »
Posted on July 16, 2014 by Ellen Brown
For years, homeowners have been battling Wall Street in an attempt to recover some portion of their massive losses from the housing Ponzi scheme. But progress has been slow, as they have been outgunned and out-spent by the banking titans.
In June, however, the banks may have met their match, as some equally powerful titans strode onto the stage. Investors led by BlackRock, the world’s largest asset manager, and PIMCO, the world’s largest bond-fund manager, have sued some of the world’s largest banks for breach of fiduciary duty as trustees of their investment funds. The investors are seeking damages for losses surpassing $250 billion. That is the equivalent of one million homeowners with $250,000 in damages suing at one time. Continue reading →
Filed under: Ellen Brown Articles/Commentary | Tagged: Black Rock, housing crisis, PIMCO, public banking, USBank | 30 Comments »
Posted on July 6, 2014 by Ellen Brown
Mortgage debt overhang from the housing bust has meant lack of middle-class spending power and consumer demand, preventing the economy from growing. The problem might be fixed by a new approach from the Fed. But if the Fed won’t act, counties will, as seen in the latest developments on eminent domain and litigation over MERS.
Former Assistant Treasury Secretary Paul Craig Roberts wrote on June 25th that real US GDP growth for the first quarter of 2014 was a negative 2.9%, off by 5.5% from the positive 2.6% predicted by economists. If the second quarter also shows a decline, the US will officially be in recession. That means not only fiscal policy (government deficit spending) but monetary policy (unprecedented quantitative easing) will have failed. The Federal Reserve is out of bullets.
Or is it? Perhaps it is just aiming at the wrong target. Continue reading →
Filed under: Ellen Brown Articles/Commentary | Tagged: eminent domain, HOLC, MERS, public banking, quantitative easing, underwater mortgage crisis | 12 Comments »
Posted on July 3, 2014 by ErnieM
A flood of foreclosures in neighborhoods, cities and towns can cause everyone’s real estate equity to plunge. Some towns would like to step-in to protect their communities, but they can’t get the mortgage notes written down to affordable levels for contractual reasons. The solution: use eminent domain to claim the properties for the municipality, then renegotiate them on behalf of struggling homeowners. Ellen talks with the pre-eminent legal mind behind the emerging eminent domain stratagem, Cornell professor Robert Hockett, whose idea has been catching on in towns across America, including some of the biggest.
Read more here.
Filed under: Ellen Brown Articles/Commentary | Tagged: eminent domain, underwater morgages | 8 Comments »
Posted on June 28, 2014 by Ellen Brown
Ann Pettifor has written an excellent rebuttal to the full reserve banking solution proposed by Martin Wolf and Positive Money, who are in most ways her allies. Her entree is the Bank of England’s recent acknowledgment that banks create the money they lend. She writes:
Because I am a vocal critic of the private finance sector, many assume that I would agree with Wolf and Positive Money on nationalising money creation. Not so. I have no objection to the nationalisation of banks. But nationalising banks is a different proposition from nationalising (and centralising) money creation in the hands of a small ‘independent committee’.
The full article is here:
Out of thin air – Why banks must be allowed to create money
Yves Smith has also commented, here:
Why Banks Must Be Allowed to Create Money
Errata: My original entry said “Richard Wolf”; it should be “Martin Wolf.” A better link is here —
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Posted on June 20, 2014 by Ellen Brown
Finance is the new form of warfare – without the expense of a military overhead and an occupation against unwilling hosts. It is a competition in credit creation to buy foreign resources, real estate, public and privatized infrastructure, bonds and corporate stock ownership. Who needs an army when you can obtain the usual objective (monetary wealth and asset appropriation) simply by financial means? — Dr. Michael Hudson, Counterpunch, October 2010
When the US Federal Reserve bought an 80% stake in American International Group (AIG) in September 2008, the unprecedented $85 billion outlay was justified as necessary to bail out the world’s largest insurance company. Today, however, central banks are on a global corporate buying spree not to bail out bankrupt corporations but simply as an investment, to compensate for the loss of bond income due to record-low interest rates. Indeed, central banks have become some of the world’s largest stock investors.
Central banks have the power to create national currencies with accounting entries, and they are traditionally very secretive. We are not allowed to peer into their books. It took a major lawsuit by Reuters and a congressional investigation to get the Fed to reveal the $16-plus trillion in loans it made to bail out giant banks and corporations after 2008.
What is to stop a foreign bank from simply printing its own currency and trading it on the currency market for dollars, to be invested in the US stock market or US real estate market? What is to stop central banks from printing up money competitively, in a mad rush to own the world’s largest companies? Continue reading →
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Posted on June 10, 2014 by Ellen Brown
It’s Our Money with Ellen Brown – Where They Hid Our Civic Treasure and How We Can Get Our Hands On It
One of the best kept deceptions within common civic parlance is that our cities, states and communities are “broke” – a meme perpetuated by a lack of public knowledge about what governments do with their money and a highly profitable investment industry that uses those funds for substantial private profits that suck outrageous sums out of our common wealth. Continue reading →
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Posted on June 10, 2014 by Ellen Brown
It’s Our Money with Ellen Brown – The Dollar’s Global Dance of Debt –
The status of the dollar as global reserve currency is being threatened by new international monetary powerhouses and the limitations of its debt-based control. This week, Ellen speaks with Mark Pash of the Center for Progressive Economics, who believes that issuance of currency as debt has outlived its usefulness and should be replaced with a credit-based model that covers basic human needs prior to personal accumulation of additional affluence. Ellen also speaks with Mike Krauss on petro-dollar politics upending America’s hold on global trade as the reserve currency. On the Public Banking Report, co-host Walt McRee talks with John Leonard of the PA Project about new public banking initiatives in one of America’s abandoned industrial centers, western PA, and the promise that public banking agencies may offer to reviving the economy that region.
Filed under: Ellen Brown Articles/Commentary | 1 Comment »
Posted on June 8, 2014 by Ellen Brown
Primary elections originated in the American progressive movement and were intended to take the power of candidate nomination away from party leaders and deliver it to the people. California’s Top Two Primary takes power away from third parties representing the 99% and delivers it to the 1%.
Voters have increasingly become disillusioned with the Democratic and Republican Parties. According to a poll reported by Rasmussen in April, more than half the country believes that neither of the top two parties represents the American people. Continue reading →
Filed under: Ellen Brown Articles/Commentary | Tagged: California primary, public banking | 36 Comments »
Posted on June 1, 2014 by Ellen Brown
Funding infrastructure through bonds doubles the price or worse. Costs can be cut in half by funding through the state’s own bank.
“The numbers are big. There is sticker shock,” said Jason Peltier, deputy manager of the Westlands Water District, describing Governor Jerry Brown’s plan to build two massive water tunnels through the California Delta. “But consider your other scenarios. How much more groundwater can we pump?”
Whether the tunnels are the best way to get water to the Delta is controversial, but the issue here is the cost. The tunnels were billed to voters as a $25 billion project. That estimate, however, omitted interest and fees. Construction itself is estimated at a relatively modest $18 billion. But financing through bonds issued at 5% for 30 years adds $24-40 billion to the tab. Another $9 billion will go to wetlands restoration, monitoring and other costs, bringing the grand total to $51-67 billion – three or four times the cost of construction.
A general rule for government bonds is that they double the cost of projects, once interest has been paid. Continue reading →
Filed under: Ellen Brown Articles/Commentary | Tagged: infrastructure financing, public banking | 75 Comments »
Posted on May 18, 2014 by Ellen Brown
The movement to break away from Wall Street and form publicly-owned banks continues to gain momentum. But enthusiasts are deterred by claims that a state-owned bank would violate constitutional prohibitions against “lending the credit of the state.”
California’s constitution is typical. It states in Section 17: “The State shall not in any manner loan its credit, nor shall it subscribe to, or be interested in the stock of any company, association, or corporation . . . .”
The language sounds prohibitive, but what does it mean? Hundreds of state and local government entities extend the credit of the state. State agencies make student loans, small business loans, and farm loans. Continue reading →
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Posted on May 9, 2014 by Ellen Brown
The major political parties have effectively locked-out any serious democratic challengers to their control on creation of public policy. This week, Green Party candidate for CA Controller Laura Wells talks with Ellen Brown (herself a Green running for CA State Treasurer) about the increasingly difficult path required of challenger candidates to even get their voices heard. They discuss Governor Jerry Brown’s proposed constitutionally-mandated rainy fund that would guarantee the state’s commitment to pay Wall Street at the expense of its own needs, the subject of Ellen’s latest article (“Robbing Main Street to Prop Up Wall Street: Why Jerry Brown’s Rainy Day Fund Is a Bad Idea for California“)
On the Public Banking Report, co-host Walt McRee talks with Lauren Steiner about a new initiative underway in Los Angeles to create a public partnership bank even as a new report shows that the city pays significantly more to Wall Street for fees and interest than it does on its own needs – to the tune of over ¾ of a billion dollars!
http://prn.fm/money-ellen-brown-electoral-lock-political-challengers-helps-guarantee-wall-street-profits-050714/
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Posted on May 6, 2014 by Ellen Brown
There is no need to sequester funds urgently needed by Main Street to pay for Wall Street’s malfeasance. Californians can have their cake and eat it too – with a state-owned bank.
Governor Jerry Brown is aggressively pushing a California state constitutional amendment requiring budget surpluses to be used to pay down municipal debt and create an emergency “rainy day” fund, in anticipation of the next economic crisis.
On the face of it, it is a sensible idea. As long as Wall Street controls America’s finances and our economy, another catastrophic bust is a good bet.
But a rainy day fund takes money off the table, setting aside funds we need now to reverse the damage done by Wall Street’s last collapse. The brutal cuts of 2008 and 2009 shrank the middle class and gave California the highest poverty rate in the country. Continue reading →
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Posted on April 23, 2014 by Ellen Brown
Posted on April 23, 2014 by Ellen Brown
Sixteen of the world’s largest banks have been caught colluding to rig global interest rates. Why are we doing business with a corrupt global banking cartel?
United States Attorney General Eric Holder has declared that the too-big-to-fail Wall Street banks are too big to prosecute. But an outraged California jury might have different ideas. As noted in the California legal newspaper The Daily Journal:
California juries are not bashful – they have been known to render massive punitive damages awards that dwarf the award of compensatory (actual) damages.For example, in one securities fraud case jurors awarded $5.7 million in compensatory damages and $165 million in punitive damages. . . . And in a tobacco case with $5.5 million in compensatory damages, the jury awarded $3 billion in punitive damages . . . .
The question, then, is how to get Wall Street banks before a California jury. How about charging them with common law fraud and breach of contract? That’s what the FDIC just did in its massive 24-count civil suit for damages for LIBOR manipulation, filed in March 2014 against sixteen of the world’s largest banks, including the three largest US banks – JP Morgan Chase, Bank of America and Citigroup. Continue reading →
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Posted on April 23, 2014 by Ellen Brown
Today’s guest on “It’s Our Money” is Nomi Prins, speaking on her blockbuster new book All the Presidents’ Bankers. Listen to the archive here.
Also check the archives for Kevin Zeese and Margaret Flowers on the burgeoning activist movement; Prof. Robert Hockett on the use of eminent domain to help underwater homeowners; and Prof. Timothy Canova on the Federal Reserve.
Great fun interviewing our favorite experts, on topics we think will interest you!
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WEB OF DEBT BLOG 
Preparing To Asset-strip Local Government? The Fed’s Bizarre New Rules
In an inscrutable move that has alarmed state treasurers, the Federal Reserve, along with the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency, just changed the liquidity requirements for the nation’s largest banks. Municipal bonds, long considered safe liquid investments, have been eliminated from the list of high-quality liquid collateral. assets (HQLA). That means banks that are the largest holders of munis are liable to start dumping them in favor of the Treasuries and corporate bonds that do satisfy the requirement. Continue reading →
Filed under: Ellen Brown Articles/Commentary | Tagged: Basel III, Federal Reserve, municipal bonds, public banking | 34 Comments »