thenatureofmind

The Issue of Regulation in the Financial Sector

I just want to share some insight about regulation in the financial sector. I worked on Wall St. during the 1980’s, in fact I worked at Bear Stearns which if you’ve been following the whole financial debacle of the past year, you know what happened to them. They were one of the most successful pioneers of derivatives. What derivatives are are securities that are based on other securities such as mortgages. What Bear Stearns did was to buy mortgages from mortgage consolidators such as Freddie Mac and Ginnie Mae. Because mortgages as a financial instrument are very unpredictable because you never know whether someone is going to live in a house forever and pay off the whole mortgage over 20 or 30 years or sell the house and pay off the mortgage. Such uncertainties drastically affect the actual value of the mortgage over time. So what Bear Stearns did was to create a secondary instrument that would contain for instance, all the first year payments from 100 mortgages. Because they have statistical data on prepayment of mortgages, having many mortgages in the instrument allows it to be more statistically predictable. So what happened on Wall St. is that the brokerage houses created these derivatives and sold them to investors many of whom were banks.

Where are we now?

I am reminded of the title of a book from the late 60's entitled: "Been Down So Long It Looks Like Up to Me". I never read the book, but the line captures the feeling that this time invokes. With world financial markets in free fall, there is the feeling that the chickens have finally come home to roost. The feeling of the pervasive ugliness of greed, self interest, hatred and other crimes of passion that have been not only condoned, but held up by political dogma as the highest reaches that we all can aspire to, have come crashing down in a collapse that these generations have not seen in their lifetimes. The bottom is still dropping away and finally the good citizens of this United States are asking themselves if indeed the past years have not been terribly wasted.

We have seen an economic ideology masquerading as science emanating from the Chicago School of Milton Friedman inspired by the likes of Ayn Rand that have glorified self interest, telling us that if self interest is pursued, that the group welfare will be adequately taken care of as if by some mysterious magic. That they were not only misguided, but horribly wrong is now obvious for all to see. Just as the Communist ideology was exposed by the failures of the Soviet Union and others, the right wing philosophies free market capitalism have brought the whole world to the brink of economic disaster. Luminaries such as Allan Greenspan who for so long hid behind reams of obscure language that dazzled his Congressional and Presidential audiences and hypnotized them into surrendering their fiduciary responsibilities to oversee and regulate the financial sector to protect the citizens that they were elected to represent now are discredited and will forever have their tombstones stamped with the finality of the word "Failure".

It is ironic to see the Republican candidate for president, John McCain continue to proclaim the free market ideological dogma as if he were unaware that the electorate at large, at least those who are intelligent enough to understand, finally see that this is a failed ideology and to re-elect another of its representatives is to ensure that this disaster will become the permanent state of the Unites States of America.

Wake up citizens! I don't know if the hole we have been dug into is too deep for us to dig out of or not, but if you don't wake up and try with everything you've got, your children and your grandchildren will live their lives in economic slavery. Vote! But don't just vote. Correspond with your elected representatives and tell them what you want, demand it, hold them accountable if they secumb to corporte interests. Corporations do not vote, they are not represented in Congress, you are. Take back your right to a government that represents you.

The Rise of the Fascist State

Join the ACLU and help restore the constitution of the United States

Exporters of terror

In 2005 the United States sold $12 Billion dollars in arms to the world. So far this year the United States has sold $32 Billion dollars in arms and the year is not over. This is almost a 3 fold increase. The United States is the number one exporter of arms to the world, the number one enabler of violence that kills innocent people. Who are the terrorists?

In 1960, Eisenhower warned us of the growing power of the military-industrial complex. By ignoring his warning we have arrived at a time when the future of the planet is in peril and a greater part of the gros national product of the United States and of many countries is devoted to destruction instead of saving the planet and its inhabitants. Are we at the end of the human experiment?

U.S. Arms Sales Climbing Rapidly

Creeping Fascism: New rules would give FBI more freedom in U.S. operations

The fundamental result of 9-11 has not been finding out the truth and dealing with the perpetrators of 9-11, but the fomenting of an unnecessary war costing the US taxpayers multi-trillions of dollars, the shredding of the constitution and the destruction of the very fabric of freedom in the United States, the destruction of the economy and the destruction hundreds of thousands of innocent lives. The propaganda machine is working overtime to convince the people that they will be safer if they surrender their privacy and freedoms. It's an awful lie....

New rules would give FBI more freedom in U.S. operations

A Culture of Lying: Hillary's trip to Bosnia

The recent media flap about Hillary and Bill's lie about the events surrounding Hillary's trip to Bosnia underscores again, the pervasiveness of the Culture of Lying. In this article, the headline is "Clinton misstates wife's Bosnia Tale". Note the word "misstates". They didn't say lie. Look around and see how often the word "lie" is used in the media. People "misstate" things, they even "misspeak" at times. They never lie. The word "lie" has been effectively expunged from the national vocabulary. If there is no word for an untruth, there are no untruths and if there are no untruths, there are no truths. It is all a game to see whose propaganda is more effective. The truth is what you can get away with. No wonder the American people have lost their way. We have a culture of national secrecy so extreme, that even the people elected to represent us really have no idea what is really going on. To conceal their own inability to find the truth, they perpetuate the culture of lying.

Clinton misstates wife's Bosnia tale

A Culture of Lying: The McCain Family Recipes

It was discovered recently that the "McCain family Recipes" posted on the McCain family website were in fact lifted verbatim from the food network. A tempest in a teapot for sure, but in the aftermath of the flap, a staffer was fired for doing this. Clearly, John and Cindy McCain knew from the start that these were not family recipes because they did not provide them to the staffer in question. So they knew, assuming that they had knowledge of their own web site that the whole thing was a lie to begin with. That in fact, in Washington and in the broader American culture, lying is the business of the day. There is in the whole culture a confusion of truth with PR. The media culture that has honed the art of creating illusion is in fact a culture of lying. Truth has nothing to do with it.

Something Fishy In McCain "Family Recipes"

A Culture of Lying: The government creates a group of "Objective" analysts to deceive the public about the war in Iraq

In this lead article in todays New York Times is detailed the Pentagons 2005 program to program a group of retired military officers to serve as military experts to the media in a blatant attempt to deceive the public.

Behind Military Analysts, the Pentagon’s Hidden Hand

Exporting Terror

U.S. Is Top Arms Seller to Developing World

Torture: It's effect on the torturers

Donald Rumsfeld once wondered aloud whether we were creating more terrorists than we were killing. In counterinsurgency doctrine, that is precisely the right question. Victory in this kind of war comes when the enemy loses legitimacy in the society from which it seeks recruits and thus loses its “recuperative power.”

The torture methods that Tenet defends have nurtured the recuperative power of the enemy. This war will be won or lost not on the battlefield but in the minds of potential supporters who have not yet thrown in their lot with the enemy. If we forfeit our values by signaling that they are negotiable in situations of grave or imminent danger, we drive those undecideds into the arms of the enemy. This way lies defeat, and we are well down the road to it.

-Charles C. Krulak, commandant of the Marine Corps from 1995 to 1999, and Joseph P. Hoar, commander in chief of U.S. Central Command from 1991 to 1994

‘Torture Betrays Us’