#bankers and bailouts

[workersolidarity]

Three, four years ago I could have told you, and did tell people, that inflation would start steadily going up, and I said even then that it would likely be stubborn, meaning it wasn't going to be an easy fix.

I knew this back then because it was obvious, even years ago, that the BRICS countries, along with many African and South Asian countries and elsewhere were looking for ways to get around using the US Dollar for trade.

They were making moves to expand trade relations outside US dollar transactions and were for many years planning and building the infrastructure for a future Multipolar world.

And that process began rapidly picking up pace three or four years ago.

I began to say then, what I'm still saying now, as that process goes on and trade outside the US Dollar system grows exponentially year-on-year, that's going to begin to have an effect on inflation.

Why? Well, Imperialism really. Because the US for decades has depended on the steady demand for US Dollars to hold down inflation, allowing the US to use debt spending to finance wars, military bases and imperialistic ventures like Syria.

Remember, it was the US in its massively dominant position after WWII that built the Bretton Woods System that made the US Dollar the world reserve currency pegged to gold, and it was the US that unilaterally abandoned Bretton Woods 1 and took the dollar off Gold, allowing for the US to finance wars through debt spending, and created the Petro-Dollar with Saudi Arabia in the 1970's.

This debt spending is essentially the surplus value from the Global South and other poorer countries that must buy US Dollars to fund infrastructure projects, energy consumption, food and medicine imports, etc since it's the world reserve currency and if you wish to use the US Financial System at all, such as the World Bank, or SWIFT messaging system, well you have to use US Dollars.

Basically, it's the sucking of the wealth out of poorer countries to finance their own economic oppression.

But as these countries catch on and with new rising global powers like Russia, China and Iran building the infrastructure for an alternative system, the US Dollar is being abandoned faster than ever.

In 2000, more than 70% of Foreign Exchange Reserves were held in US Dollars. By 2020, that figure had dropped considerably to 59%. And the rate at which it's dropping is only increasing.

Knowing this, I said back in 2019 and 2020 that inflation was likely to become a problem. And if it did become a problem, then we knew exactly what the Fed would do as a result: dramatically increase benchmark Interest rates.

This didn't take any particularly specialized or secretive sources to figure out. It's been obvious for years to anyone seriously interested in economics and geopolitics.

And what happens when interest rates go up? The value of the bonds bought under lower interest rates suddenly go way down, while debts become more expensive. It's like gravity in economics.

So with all that being said, why then did all these banks (Signature Bank, First Republic Bank, and Silicon Valley Bank) continue buying troubled assets and Treasury bonds if they're so smart and educated and knew all this?

I mean, these guys are supposed to be the best of the best corporate bankers, right? On the cutting edge of investment banking, right? That's what everyone said even just months before Silicon Valley Bank failed. (CNBC host and moron of the year Jim Cramer literally praised Silicon Valley Bank less than a month before its failure)

So one of two things must be true here and neither one is good for YOU the average worker.

Either these bankers are idiots; complete morons who have little to no understanding of basic economics, geopolitics, and monetary policy, something that should be of concern to all of us.

I mean, I'm just a dude working for a small retailer in New Orleans and even I knew this inflation and higher interest rates were coming.

So why exactly are these people paid such exorbitant salaries? If I can understand the basics of their job better than they can, why am I a retailer, and he, a millionaire banker???

So that's one possibility, one I'm virtually certain is actually true, that our ruling Elite isn't particularly smart or well educated in reality, anymore than ordinary people I meet everyday, and any one of us could easily do their jobs just as well or better than they do given the opportunities afforded to them.

But even if in this case, that's not what happened. That these weren't idiots. Well then the alternative is something that should also be deeply disturbing to you: that these bankers knew they would be facing this situation, that they were well aware of the coming inflationary pressures and equally aware what the Feds response would be, interest rate hikes.

And instead of using the last couple of years to shed possibly dangerous assets and shore up the money the banks kept on hand, they continued to do what was personally making them so much profit, at the expense of tax payers, because they were absolutely certain that the government these bankers spend so much money on campaigns for, would swoop in regardless of the recklessness of their behavior, and bail them out no matter what.

These are not the signs of a healthy political, economic or banking system.

[liberalsarecool]

Until bankers go to prison, the bailouts will get bigger and bigger.

[mostlysignssomeportents]

When parties fail, movements step up

This Saturday (19 Aug), I'm appearing at the San Diego Union-Tribune Festival of Books. I'm on a 2:30PM panel called "Return From Retirement," followed by a signing:

https://www.sandiegouniontribune.com/festivalofbooks

Does anyone like the American two party system? The parties are opaque, private organizations, weak institutions that are prone to capture and corruption, and gerrymandering's "safe seats" means that the real election often takes place in the party's smoke-filled rooms, when a sure-thing candidate is selected:

https://doctorow.medium.com/weak-institutions-a26a20927b27

But there doesn't seem to be any way to fix it. For one thing, the two parties are in charge of any reform, and they're in no hurry to put themselves out of business. It's effectively impossible for a third party to gain any serious power in the USA, and that's by design. After the leftist Populists party came within a spitting distance of power in the 1890s, the Dems and Repubs got together and cooked the system, banning fusion voting and erecting other structural barriers.

The Nader and Perot campaigns were doomed from the outset, in other words. Either candidate could have been far more popular than the D and R on the ballot, and they still would have lost. It's how the deck is stacked, and to unstack it, reformers would need to take charge of at least one – and probably both – of the parties.

But that's not cause for surrender – it's a call to action. In an interview with Seymour Hersh, Thomas Frank (Listen, Liberal) sets out another locus of power, one with the potential to deliver control over the party to its base: social movements:

https://seymourhersh.substack.com/p/ordinary-people-by-the-millions

It's been done before. The parties are routinely transformed by power-shifts within their internal coalitions: since 1970, corporate Dems have consistently pushed the party to the right, making it the power of white-collar professionals and relying on working people showing up and marking their ballots with a D because they have "nowhere else to go."

Bill Clinton was the most successful of these corporate raiders, delivering the parts of the Reagan Revolution that Reagan himself could never have managed: dismantling tariffs and bank regulations, passing the crime bill and welfare "reform." He came within a whisper of (partially) privatizing Social Security.

This set in motion the forces that made Trumpism possible: when Dems told deindustrialized workers to "learn to code" and blamed them for the destruction of their communities, it opened a space for Make America Great Again, the (empty) workerist rhetoric of the GOP. The Dems' plan of putting "really smart people" in charge and letting them run things was a (predictable) disaster. "Really smart" isn't the same as "infallible" and really smart people can be spooked or bulled into doing the wrong thing – like Obama "foaming the runways" for the banks with the houses of mortgage holders, and leaving the bankers responsible for the Great Financial Crisis unscathed:

https://pluralistic.net/2023/03/15/mon-dieu-les-guillotines/#ceci-nes-pas-une-bailout

"Really smart people" can't get us out of this mess. Instead, we need the kind of muscular political action – the "whirlwind" – that characterized FDR's New Deal: "complete reformation of the banking industry.. just about every other industry as well. Regulation. Social Security. Public works. Antitrust. Soil conservation."

FDR got there by alienating his former classmates and refusing the go-slow entreaties of his cronies. He got there because there was a mass social movement that made him do it ("I want to do it, now make me do it"):

https://humanizingthevacuum.wordpress.com/2014/09/16/i-agree-with-you-i-want-to-do-it-now-make-me-do-it/

Every time in US history where one of the political party duopoly listened to its base, it was because of a mass social movement: the farmers' movement (1890s), labor (1930s), civil rights and antiwar (1960s). As Frank says:

Social movements succeed. They build and they change the intellectual climate and then, when the crisis comes, they make possible things like agrarian reform or the New Deal or the Civil Rights acts of the 1960s.

Today, we see the seeds of those social movements: the new union movement. Black Lives Matter. Neobrandeisians with their "hipster antitrust." These are the movements that are creating "ideas lying around": ideas that, in time of crisis, can move from the fringe to the center in an eyeblink:

https://doctorow.medium.com/ideas-lying-around-33a28901a7ae

They are setting in motion another transformation of the Democratic Party, from its top-down, "really smart people" model to a bottom-up, people-powered one, kept in check by movements, not party bosses. As Frank says, "They require the mass participation of ordinary people. Without that, I am afraid that nothing is possible."

I'm kickstarting the audiobook for "The Internet Con: How To Seize the Means of Computation," a Big Tech disassembly manual to disenshittify the web and make a new, good internet to succeed the old, good internet. It's a DRM-free book, which means Audible won't carry it, so this crowdfunder is essential. Back now to get the audio, Verso hardcover and ebook:

http://seizethemeansofcomputation.org

If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:

https://pluralistic.net/2023/08/17/popular-front-of-judea/#speaking-frankly

[fluffypotatey]

Leverage 2x01

Yo ✌️ been some time since I’ve watched this show, but I am here!!!! New season new heists idk what I am getting into

Episode calls itself “the Beantown Bailout Job” 👀 so someone will be going to jail??? We’ll see I guess

the hell is Nate doing at an office??? no heist???? 🥺🥺🥺

no wait y’all they got back together end of s1 right????

the cut off at the finale was a fake out right???? my criminal found family are still in touch with each other right????

NATE IS NOT GETTING AN OFFICE JOB NO

lmao he did a batman (and yes!!! you would have hated it there Natty-boy)

ooooh ok and here we have our new poor souls for the episode 

????

Oh he’s the banker????

What are you doing dude listen to your daughter 

NATE NO

OH SHIT

ok if they hit Nate that will be a little funny

what a way to meet a new client lmao

DAM

OH SHIT

oh no the dad is gonna die

shit

Stressed

Leverage stop stressing me out challenge 

Oh hey! Dad isn’t dead

WE HAVE AN INTRO?????

Oh it’s so dated but I love it

Ok ok I think I see where this is going

Boss is so shifty. How dare you be so judgmental about alcoholics to Nate >:( he has just placed you on his shit list

awwww poor babygirl 🤧 

SOPHIEEEEEEE

SHE IS IN SOUND OF MUSIC

OH MY GOD

OH MY GOD

OHHHHHHH MY GOF

REUNIÓN

THEY 

THEY

REUNION

TO SEE SOPHIE

y’all I’m crying 🤧 so bad 

how dare they give Sophie bad reviews >:((((( 

Eliot 😂😂😂😂

“That’s very….Catholic” HELP 💀

Parker I love you

Hardinson I love you

ELIOT NO

“Not me!” Says the most criminal of them all

“I am not a thief” says the biggest thief of them all

OH SHIT

Sophie what accent was that???

PARKER

WHY ARE YOU A NUN

Hardinson already hacking shit my beloved

HARDINSON MY HACKER MY BELOVED

Eliot looks so excited saying he nabbed a briefcase

THEY ALREADY HAVE A PLAN I LOVE THEM

“What, you think she dresses like a nun for no reason?” “….she’s Parker.” no yeah that’s valid

Y’all we cannot just be 15 minutes in help me

This is such a nice apartment for one guy

Poor Eliot, always the guy (child) caught in the middle of the Nat/Sophie disaster affair

HARDINSON

OH MY GOD

fucking dying Parker the nun and Hardinson the priest help me

“I did look for you” NOBODY TOUCH ME

Parker are you flirting 👀👀👀

They just made his apartment their new office lmao

Love how Hardinson knows how to play Nate

“Oops,” says Hardinson because he, in fact, did see Eliot before he left and sent him to go look for more shit which just so happens to be in mob territory :)

YES ELIOT

LETS GO!!!! FUCK EM UP

Parker I love you

Nate :) it’s ok :) don’t hold yourself back :) help them out :) just this once yeah?

He can’t even help himself it’s so funny. He has to speak. He must share his knowledge 

I love how they all are like “yeah of course, Nate. Just one last job. Of course.”

YES HARDINSON AND PARKER FBI DUO BACK AGAIN (they aren’t playing fbi rn but you know what I mean)

Eliot & Hardinson my beloved

“Jimmy Ford’s kid” oh? They know his dad?

Love you Sophie <333333

Ohhhhhh I get it

Wait so is the dad going to die?????

Nate’s fatherly behavior coming out my beloved

NATE’S FATHERLY BEHAVIOR ACTIVATING HIS MOTIVATION FOR THIS SEASON

ok so I just know they did some extra shit we didn’t see which will tie this heist up nicely but AGH I WANNA KNOW

“There’s a problem” oh no! how will this interfere with the heist! i sure hope they have many contingencies 

Oh shit wait ok this is a big problem

“Make this up as we go” oh fuck 

Wait this guy sounds sO familiar

ELIOT!!!! ELIOT DAMGER

man, i sure hope Nate recorded all of that 👀

Eliot will not die 

WHO

NO 

WAIT HE IS FINE THO RIGHT???

Oh ok he’s fine it’s just Sophie

Sophie what are you planning 

Aw poor O’Hare

Love how Hardinson changes his voice for intimidation 

You are going shoot the dad in a hospital. Where the gunshot will be heard. As if no one will catch you. Yeah, sure go for it banker man

HAHA

LMAO THEY DID ROB IT

Awwwwww happy ending 🥰

“Still your last job?” Lmao 

Sophie you fucking liar you do not have a boyfriend

No 🥺 (y’all she doesn’t right?)

NO NATE >:( stop being dumb (ok fine just sniff it like a weird person i guess)

Well at least he paid 🙄

YES!!! APARTMENT OFFICE

THE GANG IS BACK

General thoughts: 

THE GANG IS BACK :D 

My only hope is that they don’t separate ever again in the future. Please. They are so lonely without each other. The fact that a Hardinson looked for Parker 🥺 and how he has probably looked for the rest of them. Just to keep tabs. Also how Hardinson knows a lot about Pakistan through White House emails and Eliot was in Pakistan!!!!! My ot3 heart 🤧(Yeah I am totally believing Hardinson checked the White House emails to keep tabs on Eliot. what about it?)

And how Sophie invited all of them to her show as a way of reuniting them, and her and Parker may have stayed in touch since they seem to have planned a surprise like 🥺 idk just the fact that Sophie and Parker are close gives me the warm and fuzzies

Omfg and the fact that their new office is Nate’s apartment and how everyone just falls into their roles so nicely. Like they never left it. As if it they’re all meant to be together 🫠

Love this show

[poguesmaybank]

Leverage Episode Battle

The Beantown Bailout Job: Season Two, Episode One. Six months after exacting revenge on his former company, a newly sober Nate's attempt to resume a normal life is derailed when he helps a car crash victim who was about to expose a major bank fraud. The team has returned to their old ways, but are not anywhere near as satisfied as they were before, and they all reunite to take down the banker and the Irish mob.

The Last Dam Job: Season Four, Episode Eighteen. In the wake of Jimmy Ford's death, the Leverage team must recruit allies for a final confrontation as they seek to take down both Latimer and Dubenich once and for all but Nate's own plans for the latter may have far-reaching and fatal consequences for both of them as well as the team.

[beardedmrbean]

Spanish Prime Minister Pedro Sánchez has suspended public duties to "stop and reflect" on whether to remain in the job, after a court opened a preliminary inquiry into his wife.

In a statement, the Spanish leader said he urgently needed to decide "whether I should continue to lead the government or renounce this honour".

The court said it was responding to corruption claims against Begoña Gómez.

Mr Sánchez said he would make a decision on his future next Monday.

His wife would defend her honour and work with the judiciary, he said, to make clear there was no substance to the allegations against her.

The complaint against Begoña Gómez was raised by anti-corruption campaigners Manos Limpias (Clean Hands), who have taken part in a number of high-profile court cases in recent years and are led by a man linked to the far right called Miguel Bernad.

Manos Limpias put out a statement on Thursday signed by Mr Bernad acknowledging that its allegations might be false, because they were based on online newspaper stories: "If they are not true, it will be up to those that published them to take responsibility for the falsehood."

The Socialist prime minister said he would give a statement to the media on 29 April, after reflecting whether it was worth remaining in office "despite the mud" that the right and far right were trying to turn politics into.

In a lengthy statement on X, Mr Sánchez complained of a "strategy of harassment" over months aimed at weakening him politically and personally targeting his wife.

The court did not give details of the accusations against Begoña Gómez other than to say it had begun investigating allegations of influence peddling and corruption on 16 April.

However, the Cadena Ser website published details of the Manos Limpias complaint, which included a list of allegations culled from news websites including El Confidencial and Voz Populi.

El Confidencial reported on Wednesday that the inquiry was looking into Begoña Gómez's links to private companies that had secured government money or public contracts.

In particular, it cited a "sponsorship agreement" involving tourism group Globalia and a foundation she ran in 2020 called IE Africa Center. In 2020, Globalia secured a €475m (£407m) bailout for its airline Air Europa, as part of a series of government rescue packages for companies during the Covid-19 crisis.

The legal complaint was signed by Miguel Bernad, the head of Manos Limpias, which describes itself as a trade union and has in the past targeted politicians, bankers and King Felipe VI's sister, Princess Cristina.

Spain's conservative Popular Party (PP) demanded explanations in parliament earlier on Wednesday, to which the prime minister said simply that he believed in justice "despite everything".

Spanish media said he had left parliament for his Madrid residence visibly upset. Hours later he accused PP leader Alberto Núñez Feijóo of working with far-right party Vox to bring him down.

"I am not naive. I realise they are denouncing Begoña, not because she has done anything illegal - they know there is no case - but because she is my wife," he complained in his statement.

Political allies expressed support for Mr Sánchez, who has been in power since 2018, but his decision to suspend public duties comes at a tense time for his Socialist party ahead of European Parliament elections in June and elections in the Catalonia region of north-eastern Spain next month.

He was due to take part in a Catalan campaign launch in Barcelona on Thursday.

Pedro Sánchez leads an awkward coalition that includes two Catalan separatist parties, which were persuaded to support the government in return for an amnesty that covered a banned Catalan referendum on secession in 2017.

Without the support of the Catalan Republican Left (ERC) and Together for Catalonia (JxCat) he would not have been able to stay in power, following an inconclusive election last year.

Opposition parties were outraged by the amnesty, which also means the former Catalan regional leader Carles Puigdemont will stand in next month's regional vote, seven years after he fled imminent arrest and went into exile in Belgium.

Mr Puigdemont is still facing a terrorism case but believes the amnesty will enable him to return to Spain.

[mariacallous]

At first glance, the Silicon Valley Bank debacle seems to be a cut-and-dried financial caper. The executives running the 16th-largest bank in the US made the wrong choices in handling what seemed a fortuitous situation—a roster of clients, flush with venture capital funding, handing over billions of dollars of cash for storage in the institution's coffers. But the bank’s leaders misjudged the risks of higher interest rates and inflation. Pair that with a mini tech downturn, and the bank’s spreadsheets began turning colors. When word of its perilous situation got out, panicky depositors pulled their money. After a government takeover, everyone’s money was safe. 

But although no depositor lost money, the saga looks like a traumatic event whose consequences will linger for months, or even years. Things happened that we can’t unsee. The SVB saga reminds me of what my wife, a true-crime reporter, says when people ask why she finds murder stories so interesting. A killing, she’d say, reveals the previously private, shrouded actions that define the way people live. In the course of investigating the crime, lives that looked ideal from the outside are exposed as unmade beds of secrets and lies. 

Start with the bank. As has been widely reported—only now with a critical eye—Silicon Valley Bank was not only the bank of choice among Silicon Valley companies, but an ingratiating cheerleader for startup culture. The VCs and angels funding new companies would routinely send entrepreneurs to the bank, which often handled both company accounts and the personal finances of founders and executives. SVB would party with tech people—and vintners, another sector they were deep into. Some bankers had wine fridges in their offices. Salud!

Normally, you’d have to hold my family hostage before I became a banker—I picture the buttoned-up prig who hired Mary Poppins. But I might think differently if banking were a world of parties, high-end Cabernets, and elbow-rubbing with universe-denting geniuses who keep millions in the bank and take out mega-mortgages. By all accounts, SVB shared and perhaps amplified the freewheeling vibe of the swashbucklers it served. This is not what you necessarily want from a fiduciary. And as we learned this week, SVB’s CEO reportedly indulged in one of the worst things a founder can do—selling off stock when trouble lies ahead. 

 When that trouble arrived, we also learned a lot about the investment lords of the Valley who give founders the millions they need to move fast and make things. As word began to leak of SVB’s weaknesses, VCs who style themselves as tech’s smartest people had a choice: help bolster the financial partner holding the industry’s assets or pull funds immediately. The latter course would trigger a panic that would assure disaster for the startup ecosystem—but not you, because you were first in line. 

Despite years of talk about how companies in the tech world are united in a beneficial joint mission, some of the biggest players went into self-preservation mode, essentially firing the starting pistol for a bank run. One notable bailout leader was Peter Thiel’s Founders Fund, which got an early sense of SVB’s troubles and advised all its companies to get out ASAP. As word spread, a classic bank run took shape, with other VC firms urging pullouts, until it was impossible to connect online with SVB to move funds. By the time a group of VCs came together to pledge support for SVB, its virtual doors were shut. In the mad rush to the lifeboats, hundreds of companies were stranded on deck. When the Federal Deposit Insurance Corporation (FDIC) took over Silicon Valley Bank last Friday, with all activity frozen, those whose holdings in the bank far exceeded the $250,000 limit on insured accounts truly faced the abyss.

I get it—saving one’s own skin is human nature. But in the future, let’s go easy on hyping the camaraderie of tech. 

And what did the Valley’s rugged individuals do when oblivion loomed? They begged for a government rescue, of course. It’s hard not to empathize with some of the rank and file tech workers, many of them far from California, who wouldn’t be able to meet their bills. And indeed, there were some acts of generosity, as investors extended loans to their portfolio companies. But the loudest voices urging bailouts didn’t seem to be those most in jeopardy, but super-rich investors and speculators likeself-described angel investor Jason Calacanis, PayPal mafia billionaire David Sacks, and Machiavellian hedge fund magnate Bill Ackman, bombing Twitter with over-the-top pleas to rescue depositors.

Their case was that if depositors didn’t have immediate access to their funds, SVB’s woes might be “contagious,” setting off a wider bank panic. A reasonable concern. But it’s unlikely these pundits would have made the same arguments if the institution in question were some regional bank of similar size in the Midwest. Some people arguing for a federal bailout had previously opined that the government should keep its tentacles away from the innovative geniuses of the Valley.

The spectacle is particularly ironic because a huge part of startup lore is not just accepting risk but embracing it. We hear endlessly of the bravery of entrepreneurs who step into the breach and put millions of dollars in jeopardy, hoping to buck the dismal odds of creating a difference-making company that, by the way, makes its founders ludicrously wealthy. It’s part of the game to lose your investor’s money and a couple of years of your life because you felt that a $400 juice machine would be the next iPhone. 

Now those noble risk-takers were demanding retroactive protection—because tech-company money was unavailable due to a totally avoidable risk. Any idiot knows that FDIC covers only $250,000. So why did so many firms store all their assets in uninsured accounts in a single bank? You might give a pass to naive founders who blindly accepted the recommendation of their funders to use Silicon Valley Bank. (Though maybe not to big companies like Roku, which had $487 million on deposit in SVB.) But what’s the excuse of those who did the recommending? Did they notice that SVB executives actively lobbied to avoid stringent regulation? Or that for eight months, SVB failed to replace its retired chief risk officer? Did they understand that an entire startup monoculture patronizing one bank made a huge industry dependent on a single point of failure?

Meanwhile, less verbose investors and VCs quietly worked behind the scenes on convincing the FDIC to guarantee all deposits. One of the Valley’s top seed investors, Ron Conway, reportedly even got Vice President Kamala Harris on the phone to hear his plea for a depositor bailout. The case they made for protecting funds from a maximum $250,000 to, well, infinity, was a more refined version of what the Twitter panics-spreaders were saying: It would stem a collapse in the tech sector and calm people all over the country who were suddenly worried about their own banks’ stability. (It would also mean that from this point forward, holding to the limit is indefensible.) It’s not clear whether the lobbying affected the actual decision. But the attempts were unseemly, an unattractive display of the power of this massive industry. 

So what has been uncovered in the week since we learned that Silicon Valley Bank was no more trustworthy than a crypto spam text? A startup culture once considered the gem of the economy has been exposed as careless with its money, clueless in its judgment of character, hypocritical in its ideology, and ruthless in exercising its political clout as a powerful special interest. Meanwhile, the financial world is still jittery, with other banks failing and just about everyone wondering what comes next. And from here on, the concept of a cap on FDIC insurance is at risk. But at least the SVB credit cards are working again. And VCs can take a victory lap as they brag about how they saved the day.

[edwordsmyth]

"The underlying reason why the failure of a medium-sized bank in California created so much angst worldwide is that international capitalism has never been able to get back on its feet after 2008.

In more detail: Central banks (the FED, the ECB, etc.) have one basic tool – the interest rate. When they want to put a brake on economic activity to keep inflation in check, they raise the interest rate, and vice-versa. But, in addition to price stability, central banks have two other goals: the stability of the banking system, and the balancing of liquidity with investment. The interest rate chosen by the central bank is one. That same number (e.g. 3%) must achieve three objectives simultaneously: price stability, banking system stability, and balancing between liquidity and investment.

And herein lies the reason why I argue that, after 2008, capitalism cannot recover: There is no longer one interest rate that can achieve all three of these objectives simultaneously. This is the tragedy of central bankers: If they want to tame inflation (at a high enough interest rate), they trigger a banking crisis and, as a result, they are forced to bail out the oligarchs who, despite being bailed out, drive investments below liquidity. If, on the other hand, they impose a lower interest rate to avoid triggering a banking crisis, then inflation gets out of control – with the result that businesses expect interest rates to rise, which discourages them from investing. And so on and so forth.

Back to 2008, then?

No, for two reasons. First, the problem for US banks today is not that their assets are junk (e.g. structured derivatives based on red loans) as they were in 2008, but that they own government bonds which they are simply forced to sell at a discount. Second, the Fed bailout announced yesterday is different from the one in 2008 – today it is the banks and depositors who are being bailed out, but not the bank owners-shareholders. These two reasons explain why bank stocks are falling but there is no total collapse of stock markets.

The fact that there is no total collapse of the stock markets does not, of course, mean that the crisis of capitalism – which has been developing continuously since 2008 – is not deepening. It simply does not have the characteristics of an instantaneous, heavy-handed fall.

What should have been done?

Since 2008, governments and central banks have been trying to prop up the banks through a combination of socialism for the banks, and austerity for everyone else. The result is what we see today: The metastasis of the crisis from one “organ” of capitalism to another, with the magnitude of the crisis increasing with each such metastasis.

What could be done as an alternative? The exact opposite: austerity for the banks, with nationalisation of those who cannot survive. And socialism for workers – a basic income for all, a return to collective bargaining and, further out, new forms of participatory ownership of high- and low-tech companies. In other words, nothing short of a political revolution.

To those who fear the idea of a political revolution, my message is simple: Prepare to pay the price of the escalating crisis of a capitalism determined to take us all to its grave."

[wizard-hamnet]

Mogul and management department 3.5

Then

Billionaires and Baphomet was a poorly designed fan version of Billionaires and Bastards which was very well designed but when they nerfed the bankers with the bailout in 08 it destroyed the ability of lower level characters to believe in capitalism in any sort of meaningful way

Here is a free pdf of the players handbook

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Here is a free pdf to dungeon master’s guide

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For all your dnd purposes

[workersolidarity]

Biden offers assurances after major US banks collapse | Business and Economy News | Al Jazeera

What can even be said at this point?

Both the second and third largest bank failures in the history of the United States occurred over the weekend.

This really shouldn't be surprising. Thanks largely to the sanctions regimes placed on Russia and China over the last year have caused stubbornly high inflation across the West.

The US banker-run Fed has responded to the inflation with ever increasing interest rates, raising borrowing costs for Banks that have, once again, been mainly focused on short-term profit seeking over stable investments.

Unlike the banking regulations put into effect after the Great Depression, Dodd-Frank, enacted shortly after 2008 bank failures, was purposely over-complicated, full of loopholes, and only partially enacted and enforced.

It should come as no surprise then that banks like SVB and Signature Bank held an inordinate amount of risky investments that lost value since the Feds interest rate hikes, and because of obvious loopholes in the Law, these banks didn't have to report the degradation in value of these investments until they went to sell them, when suddenly their customers realized just how much money their bank had lost, leading to a traditional bank-run.

And of course, the Biden Administration runs to the rescue, securing depositors of ALL amounts at these banks, once again making it crystal clear to the rich that there will be no consequences to any of their actions EVER.

The point is, the Capitalist Class at the helm can't even make decisions based on their own long-term stability, let alone for the economic stability of the people.

From idiotic sanctions, pointless wars, endless aid to Ukraine, bailouts of rich depositors, endless increases in the Defense Budget, these people can't even defend their own interests because they're so hyperfocused on short-term political and economic gain.

I mean do people even realize this inflation is basically the result of just two things, sanctions and endless war spending???

[aldridg5]

WOKE: The Obama Administration Bailout Out Bankers while people go Homeless. We Need Cosmic Cops to Land. Diabolical Evil!

[mostlysignssomeportents]

Biden should support the UAW

On September 22, I'm (virtually) presenting at the DIG Festival in Modena, Italy. That night, I'll be in person at LA's Book Soup for the launch of Justin C Key's "The World Wasn’t Ready for You." On September 27, I'll be at Chevalier's Books in Los Angeles with Brian Merchant for a joint launch for my new book The Internet Con and his new book, Blood in the Machine.

The UAW are on strike against the Big Three automakers. Biden should be roaring his full-throated support for the strike. Doing so would be both just and shrewd. But instead, the White House is waffling…and if recent history is any indication, they might actually come out against the strike.

The Biden administration is a mix of appointees from the party's left Sanders/Warren wing, and the corporatist, "Third Way" wing associated with Clinton and Obama, which has been ascendant since the Reagan years. The neoliberal wing presided over NAFTA, the foreclosure crisis, charter schools and the bailout for the bankers – but not the people. They voted for the war in Iraq, supported NSA mass-surveillance, failed to use their majorities to codify abortion rights, and waved through mega-merger after mega-merger.

By contrast, the left wing of the party has consistently fought monopoly, war, spying, privatized education and elite impunity – but forever in the shadow of the triangulation wing, who hate the left far more than they hate Republicans. But with the Sanders campaign, the party's left became a force that the party could no longer ignore.

That led to the Biden administration's chimeric approach to key personnel. On the one hand, you have key positions being filled by ghouls who cheered on mass foreclosures under Obama:

https://pluralistic.net/2023/03/06/personnel-are-policy/#janice-eberly

And on the other, you have shrewd tacticians who are revolutionizing labor law enforcement in America, delivering real, material benefits for American workers:

https://pluralistic.net/2023/09/06/goons-ginks-and-company-finks/#if-blood-be-the-price-of-your-cursed-wealth

Progressives in the Biden administration have often delivered the goods, but they're all-too-often hamstrung by the corporate cheerleaders the party's right wing secured – think of Lina Khan losing her bid to block the Microsoft/Activision merger thanks to a Biden-appointed, big-money-loving judge:

https://pluralistic.net/2023/07/14/making-good-trouble/#the-peoples-champion

These self-immolating own-goals are especially visible when it comes to strikes. The Biden admin intervened to clobber railway workers, who were fighting some of the country's cruelest, most reckless monopolists, whose greed threatens the nation:

https://pluralistic.net/2023/02/11/dinah-wont-you-blow/#ecp

The White House didn't have the power to block the Teamsters threat of an historic strike against UPS, but it publicly sided with UPS bosses, fretting about "the economy" while the workers were trying to win a living wage and air conditioning for the roasting ovens they spend all day in.

Now, with the UAW on strike against the monopolistic auto-makers – who received repeated billions in public funds, gave their top execs massive raises, shipped jobs offshore, and used public money to lobby against transit and decarbonization – Biden is sitting on the sidelines, failing to champion the workers' cause.

Writing in his newsletter, labor reporter Hamilton Nolan makes the case that the White House should – must! – stand behind the autoworkers:

https://www.hamiltonnolan.com/p/whose-fault-is-it?

Nolan points out that workers who strike without the support of the government have historically lost their battles. When workers win labor fights, it's typically by first winning political ones, dragging the government to the table to back them. Biden's failure to support workers isn't "neutral" – it's siding with the bosses.

Today, union support is at historic highs not seen in generations. The hot labor summer wasn't a moment, it was a turning point. Backing labor isn't just the moral thing to do, it's also the right political move:

https://pluralistic.net/2023/09/14/prop-22-never-again/#norms-code-laws-markets

Biden is already partway there. He rejected the Clinton/Obama position that workers would have to vote for Democrats because "we are your only choice." Maybe he did that out of personal conviction, but it's also no longer politically possible for Democrats to turn out worker votes while screwing over workers.

The faux-populism of the Republicans' Trump wing has killed that strategy. As Naomi Klein writes in her new book Doppelganger, Steve Bannon's tactical genius is to zero in on the areas where Democrats have failed key blocks and offer faux-populist promises to deliver for those voters:

https://pluralistic.net/2023/09/05/not-that-naomi/#if-the-naomi-be-klein-youre-doing-just-fine

When Democrats fail to bat for workers, they don't just lose worker votes – they send voters to the Republicans. As Nolan writes, "working people know that the class war is real. They are living it. Make the Democratic Party the party that is theirs! Stop equivocating! Draw a line in the sand and stand on the right side of it and make that your message!"

The GOP and Democrats are "sorting themselves around the issue of inequality, because inequality is the issue that defines our time, and that fuels all the other issues that people perceive as a decline in the quality of their own lives." If the Democrats have a future, they need to be on the right side of that issue.

Biden should have allowed a railroad strike. He should have cheered the Teamsters. He should be on the side of the autoworkers. These aren't "isolated squabbles," they're "critical battles in the larger class war." Every union victory transfers funds from the ruling class to the working class, and erodes the power of the wealthy to corrupt our politics.

When Democrats have held legislative majorities, they've refused to use them to strengthen labor law to address inequality and the corruption it engenders. Striking workers are achieving the gains that Democrats couldn't or wouldn't take for themselves. As Nolan writes:

Democratic politicians should be sending the unions thank you notes when they undertake these hard strikes, because the unions are doing the work that the Democrats have failed to accomplish with legislation for the past half fucking century. Say thank you! Say you support the workers! They are striking because the one party that was responsible for ensuring that the rich didn’t take all the money away from the middle class has thoroughly and completely failed to do so.

Republican's can't win elections by fighting on the class war. Democrats should acknowledge that this is the defining issue of our day and lean into it.

Whose fault is a strike at the railroads, or at UPS, or in Hollywood, or at the auto companies? It is the fault of the greedy fuckers who took all the workers’ money for years and years. It is the fault of the executives and investors and corporate boards that treated the people who do the work like shit. When the workers, at great personal risk, strike to take back a measure of what is theirs, they are the right side. There is no winning the class war without accepting this premise.

Autoworkers' strikes have been rare for a half-century, but in their heyday, they Got Shit Done. Writing in The American Prospect, Harold Meyerson tells the tale of the 1945/46 GM strike:

https://prospect.org/labor/2023-09-18-uaw-strikes-built-american-middle-class/

In that strike, the UAW made history: they didn't just demand higher wages for workers, but they also demanded that GM finance these wages with lower profits, not higher prices. This demand was so popular that Harry Truman – hardly a socialist! – stepped in and demanded that GM turn over its books so he could determine whether they could afford to pay a living wage without hiking prices.

Truman released the figures proving that higher wages didn't have to come with higher prices. GM caved. Workers got their raise. Truman touched the "third rail of American capitalism" – co-determination, the idea that workers should have a say in how their employers ran their businesses.

Co-determination is common in other countries – notably Germany – but American capitalists are violently allergic to the idea. The GM strike of 45/6 didn't lead to co-determination, but it did effectively create the American middle-class. The UAW's contract included cost-of-living allowances, wage hikes that tracked gains in national productivity, health care and a defined-benefits pension.

These provisions were quickly replicated in contracts with other automakers, and then across the entire manufacturing sector. Non-union employers were pressured to match them in order to attract talent. The UAW strike of 45/6 set in motion the entire period of postwar prosperity.

As Meyerson points out, today's press coverage of the UAW strike of 2023 is full of hand-wringing about what a work-stoppage will do to the economy. This is short-sighted indeed: when the UAW prevails against the automakers, they will rescue both the economy and the Democratic party from the neo-feudal Gilded Age the country's ultrawealthy are creating around us:

https://doctorow.medium.com/the-end-of-the-road-to-serfdom-bfad6f3b35a9?sk=207d6afdb89b0351b92233cc3318ab94

There's a name for a political strategy that seeks to win votes by making voters' lives better – it's called "deliverism." It's the one thing the Trump Republican's won't and can't do – they can talk about bringing back jobs or making life better for American workers, but all they can deliver is cruelty to disfavored minorities and tax-breaks for the ultra-rich:

https://pluralistic.net/2023/07/10/thanks-obama/#triangulation

Deliverism is how the Democrats can win the commanding majorities to deliver the major transformations America and the world need to address the climate emergency and dismantle our new oligarchy. Letting the party's right wing dominate turns the Democrats into caffeine-free Republicans.

When the Dems allowed the Child Tax Credit to lapse – because Joe Manchin insisted that poor people would spend the money on drugs – they killed a program that had done more to lift Americans out of poverty than anything else. Today, American poverty is skyrocketing:

https://thehill.com/opinion/finance/4206837-poverty-made-an-alarming-jump-congress-could-have-stopped-it/

Four million children have fallen back into poverty since the Dems allowed the Child Tax Credit to lapse. The rate of child poverty in America has doubled over the past year.

The triangulators on the party's right insist that they are the adults in the room, realists who don't let sentiment interfere with good politics. They're lying. You don't get working parents to vote Democrat by letting their children starve.

America's workers can defeat its oligarchs. They did it before. Biden says he's a union man. It's time for him to prove it. He should be on TV every night, pounding a podium and demanding that the Big Three give in to their workers. If he doesn't, he's handing the country to Trump.

If you'd like an essay-formatted version of this post to read or share, here's a link to it on pluralistic.net, my surveillance-free, ad-free, tracker-free blog:

https://pluralistic.net/2023/09/18/co-determination/#now-make-me-do-it

[liberalsarecool]

Corporate bailouts only help shareholders. No workers see a dime. All hardships are increased.

Bankers need to go to jail to prevent future industry-wide failures.

Rich people always say that they deserve the profits because they take the risks.

But when the risk doesn't pay off, they expect to be bailed out.

[poguesmaybank]

Leverage Episode Battle

The Beantown Bailout Job: Season Two, Episode One. Six months after exacting revenge on his former company, a newly sober Nate's attempt to resume a normal life is derailed when he helps a car crash victim who was about to expose a major bank fraud. The team has returned to their old ways, but are not anywhere near as satisfied as they were before, and they all reunite to take down the banker and the Irish mob.

The (Very) Big Bird Job: Season Five, Episode One. As the team adjusts to their new home of Portland, Oregon, they take on the case of a corrupt airline executive who has a strong obsession with Howard Hughes and his Spruce Goose, which is now on exhibit in a museum. Hardison and Parker reveal that they are now a couple.

[leprivatebanker]

Pakistan finance minister warns taxes must rise to break the bailout cycle

Former JPMorgan banker says Islamabad must ‘get real’ as it seeks 24th IMF package