The Detroit Bail-In Template: Fleecing Pensioners to Save the Banks

Ellen Brown • www.counterpunch.org • August 6, 2013

The Detroit bankruptcy is looking suspiciously like the bail-in template originated by the G20’s Financial Stability Board in 2011, which exploded on the scene in Cyprus in 2013 and is now becoming the model globally. In Cyprus, the depositors were “bailed in” (stripped of a major portion of their deposits) to re-capitalize the banks. In Detroit, it is the municipal workers who are being bailed in, stripped of a major portion of their pensions to save the banks.

…There are other steps that need to be taken, and soon, to prevent a cascade of municipal bankruptcies. The super-priority of derivatives in bankruptcy needs to be repealed, and the protections of Glass Steagall need to be restored. While we are waiting on a very dilatory Congress, however, state and local governments might consider protecting themselves and their revenues by setting up their own banks.

Read the entire article here.

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Richmond, California, Fights Banks With First-In-The-Nation Plan using the Power of Eminent Domain

PAUL ELIAS • www.huffingtonpost.com • August 25, 2013

When the mayor of Richmond, Calif., and a gaggle of activists and homeowners showed up at the Wells Fargo Bank headquarters in downtown San Francisco this month, they were on a mission to speak with the bank’s chief executive.

They wanted the bank to drop a lawsuit aimed at stopping Richmond’s first-in-the-nation plan to use the government’s constitutional power of eminent domain to “seize” hundreds of mortgages from Wells Fargo and other financial institutions.

Read the entire article here.

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Cutting Loose: Hungary pays off IMF debt, may eye EU exit – Russia Today news

Scott Baker • www.opednews.com • August 26, 2013

First Iceland, and now Hungary, are now embarking on a Sovereign Money road to monetary independence. They are both telling the IMF and other international bankers from the EU that “Thanks, but no thanks for your debt money, we can make our own debt-free money.” Forces from both the far Right and progressive side of the political spectrum are coming together in throwing out the unsustainable debt-money system, which not only preaches unworkable austerity, and sequestration, but whose adherents can’t even understand the basic fact that you can’t eliminate debt in a debt-based money system without eliminating money as well, and plunging us into a deflationary depression not seen since Andrew Jackson paid off the national debt in 1836 – resulting in an even worse and longer depression than the Great Depression. What we need to do is continue necessary spending, but eliminate the debt.

Read the entire article here.

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Green Light for City-owned San Francisco Bank

Ellen Brown • www.huffingtonpost.com • July 31, 2013

When the Occupiers took an interest in moving San Francisco’s money into a city-owned bank in 2011, it was chiefly on principle, in sympathy with the nationwide Move Your Money campaign. But recent scandals have transformed the move from a political statement into a matter of protecting the city’s deposits and reducing its debt burden. The chief roadblock to forming a municipal bank has been the concern that it was not allowed under state law, but a legal opinion issued by Deputy City Attorney Thomas J. Owen has now overcome that obstacle.

Establishing a city-owned San Francisco Bank is not a new idea. According to City Supervisor John Avalos, speaking at the Public Banking Institute conference in San Rafael in June, it has been on the table for over a decade. Recent interest was spurred by the Occupy movement, which adopted the proposal after Avalos presented it to an enthusiastic group of over 1,000 protesters outside the Bank of America building in late 2011. David Weidner, writing in The Wall Street Journal in December of that year, called it “the boldest institutional stroke yet against banks targeted by the Occupy movement.” But Weidner conceded that:

“Creating a municipal bank won’t be easy. California law forbids using taxpayer money to make private loans. That would have to be changed. Critics also argue that San Francisco could be putting taxpayer money at risk.”

The law in question was California Government Code Section 23007, which prohibits a county from “giv[ing] or loan[ing] its credit to or in aid of any person or corporation.” The section has been interpreted as barring cities and counties from establishing municipal banks. But Deputy City Attorney Thomas J. Owen has now put that issue to rest in a written memorandum dated June 21, 2013, in which he states:

“1. A court would likely conclude that Section 23007 does not cover San Francisco because the City is a chartered city and county. Similarly, a court would likely conclude that Article XVI, section 6 of the State Constitution, which limits the power of the State Legislature to give or lend the credit of cities or counties, does not apply to the City. . . . [A] court would likely then determine that neither those laws nor the general limitations on expending City funds for a municipal purpose bar the City from establishing a municipal bank.2. A court would likely conclude that the City may own stock in a municipal bank and
spend City money to support the bank’s operation, if the City appropriated funds for that purpose and the operation of the bank served a legitimate municipal purpose.”

A number of other California cities that have explored forming their own banks are also affected by this opinion. As of June 2008, 112 of California’s 478 cities are charter cities, including not only San Francisco but Los Angeles, Richmond, Oakland and Berkeley. A charter city is one governed by its own charter document rather than by local, state or national laws.

Read the entire article here.

The Leveraged Buyout of America

Ellen Brown • www.truth-out.org • August 26, 2013

In a letter to Federal Reserve Chairman Ben Bernanke dated June 27, 2013, US Representative Alan Grayson and three co-signers expressed concern about the expansion of large banks into what have traditionally been non-financial commercial spheres. Specifically:

[W]e are concerned about how large banks have recently expanded their businesses into such fields as electric power production, oil refining and distribution, owning and operating of public assets such as ports and airports, and even uranium mining.

After listing some disturbing examples, they observed:

According to legal scholar Saule Omarova, over the past five years, there has been a “quiet transformation of U.S. financial holding companies.” These financial services companies have become global merchants that seek to extract rent from any commercial or financial business activity within their reach.  They have used legal authority in Graham-Leach-Bliley to subvert the “foundational principle of separation of banking from commerce”. . . .

It seems like there is a significant macro-economic risk in having a massive entity like, say JP Morgan, both issuing credit cards and mortgages, managing municipal bond offerings, selling gasoline and electric power, running large oil tankers, trading derivatives, and owning and operating airports, in multiple countries.

A “macro” risk indeed – not just to our economy but to our democracy and our individual and national sovereignty. Giant banks are buying up our country’s infrastructure – the power and supply chains that are vital to the economy. Aren’t there rules against that? And where are the banks getting the money?

Read the entire article here.

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Truthdigger of the Week: Ellen Brown

Alexander Reed Kelly • www.truthdig.com • August 25, 2013

Every week the Truthdig editorial staff selects a Truthdigger of the Week, a group or person worthy of recognition for speaking truth to power, breaking the story or blowing the whistle. It is not a lifetime achievement award. Rather, we’re looking for newsmakers whose actions in a given week are worth celebrating.

What could happen if we took authority over banking away from Wall Street and gave it to the public? We’re told this is a bad idea—finance is too complex for common people. No doubt this is true. But as events of the last decade have shown, banking in its current form is too complicated even for Harvard-educated “financial wizards” to understand.

…The crash of 2008 demonstrated the dangers of letting the financial industry govern itself. Then the laughably inadequate regulatory response from Congress and the subsequent recovery-for-the-rich-only proved beyond a shadow of a doubt that the banking class owns all three branches of the U.S. government. That means that wherever it threatens the interests of the rich, political democracy exists in name only. As Truthdig columnist Chris Hedges has repeatedly said, somewhere along the line our government underwent a “corporate coup d’état in slow motion.” Through the genius wiles of private finance, the American government became a beneficence and protection racket for the rich.

…Many Americans grasp this instinctively, but only a small number have the training and time necessary to put together what’s happened in a way that makes even a part of the whole devious system apparent. Among them is Ellen Brown, a former civil litigation attorney who has spent much of the past decade outlining, in terms ordinary Americans can understand, the financial scheme the superrich use to plunder everyone else. Her articles appear on her website, The Web of Debt Blog, and are republished on independent websites like Truthdig and mainstream operations like The Huffington Post.

Read the entire article here.

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Money Is Not Safe In The Big Banks

Public Banking TV • www.youtube.com/user/publicbankingtv • August 24, 2013

People think that money is safe in the big banks because the FDIC will protect the deposits. This assumption is not based on the facts. This video will show official government documents that describe the plans for confiscating deposits when, (not if) a big bank fails. Individual, as well as public funds from municipal, university, county deposits are at serious risk. YOUR taxpayer money will disappear in the next crisis! Public officials in charge of taxpayer funds need to be aware of the dangers here. The loss of taxpayer funds and the inability to meet payrolls and obligations will certainly prompt a response that will both immediate and forceful.

This video may be useful to present to public officials to inform them of the dangers of losing public funds under their care.

 

Watch the video here.

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