Some thoughts on the warmest winter in memory

So this is global warming?

I was kind of OK with this narrative about how fossil fuels are destroying the climate, till I heard that some sharpies at Goldman Sachs had figured out that something called a "carbon tax" would help set things right.

That's where the over-polluters buy carbon credits from lesser polluters, and it's all good because GS will be having their sticky fingers all over this little global carbon credit exchange thingy.

Sounds like the fat kid paying the anorexic kid hush money so he can keep gorging.

This has in fact been the softest winter in memory, at least so far. That could change yet.

By contrast, the last two winters were among the harshest ever.

Which proves nothing.

Which is why you need to scratch your head when you hear that the Rumpelstiltskins at Goldman Sachs have figured out a way to stop climate change.

After a thorough review of the peer-vetted sources, I've come to the conclusion that climate has been changing as long as this little marble of misery we inhabit has had a climate.

For instance, I'm told that here in southern Ontario, ten thousand years ago, the snow was piled up miles deep.

There must have been a whack of climate change to make all that snow melt. And it melted way before the fossil fuel era and the industrial age.

So there's nothing new about climate change.

Why Trump's "attack" on hedge funds was nothing of the sort

Most of the coverage I've seen about Trump's so-called attack on hedge fund managers gets it all wrong. Allegedly Mr. Trump is taking these guys to task for paying less than their share of taxes. Instead of paying at the "income" rate of 39.6% that the peons pay, they're using the "carried interest loophole" and other magic tricks to pay a mere 20%, which is the capital gains tax rate.


So the big boys are paying 20% on their profits, are they? Not bloody likely! Oh ya, maybe on the few profits they declare in the US, but what kind of doofus keeps his money in the US when the world is awash in tax havens where you'll pay little or nothing?


Remember the hoo-ha over the Mittster's financial revelations before the last election?  On the face of it, Romney was paying a tax rate of 15% on gains declared in the US. Sure, that's enough of a scandal, but myriad investigative journalists never really got to the bottom of what's in those Romney accounts in Luxemburg, Cayman Islands, Bahamas...


That's the REAL scandal!


Trump has done a valuable public service in shining a light on these non-productive paper-shufflers. But Trump himself is well aware that the problem is not the 20% capital gain tax rate.


The real problem is the hundreds of billions that successful American corporations and wealthy individuals deliberately offshore in tax havens to avoid paying any share of their US tax burden.

Consider the billionaire

We hear a lot about billionaires these days.

Billionaire Donald Trump is leading the polls in the US presidential race.

Billionaire Koch brothers have committed to spending a billion dollars on the 2016 campaign.

Billionaire Sheldon Adelson perpetually maintains a far right stable of politicians in both Israel and the US.

So what is a "billionaire" and why do they so consistently favour right wing politicians?

Although Obama has made some noises about raising the minimum wage, it remains at $7.25 an hour. The millions of Americans making that minimum wage earn about $15,000 a year if they have the good fortune of working full time.

When an American worker works full time for minimum wage, they won't make a million dollars even if they start at age 15 and work till they're 70.

A thousand of those workers, working full time from age 15 to age 70, will not add up to a billion dollars.

Here's a guy who made more money last year than a thousand of those workers will make in their entire lives, even if they start at 15 and keep the pedal to the metal till they're 70.







Yup, that would be hedgie Steve Cohen, who made 1.3 billions last year. Oddly enough, that was kind of an off year for him. Steve has had a run of rotten luck with SEC investigations and that kind of stuff.

And what does Steve do in order to merit more money in one year than a thousand drool-wipers and diaper changers working in old-age homes across America will earn in their lifetimes?

He and his peers are the new Rumpelstiltskins.

They spin straw into gold.

Sometimes they do it by taking over companies and parting them out. The manufacturing part goes to China. The union contracts go into Chapter 11. The pension plans go into their pockets.

It's a winning formula!

Sometimes they do it via brazen paper shuffling with derivatives so complicated that it takes a team of math doctorates to figure them out.

That's the Rumpelstiltskin economy.

Now to be fair, not all billionaires have been paper shufflers. Those Koch boys actually run a real conglomerate that does real stuff and employs quite a lot of real people. They  have committed themselves to spending a billion dollars to make sure a billionaire-friendly candidate makes it to the White House in 2016.

That's the equivalent of the lifetime earnings of a thousand low wage workers, pressed into service for one election.

You can call that a lot of things, but you cannot call it democracy.

Has the global economy calmed the Hellenic crisis, or is this the calm before the storm?

Those fuckin' Greeks, eh?

They want dignity?

They have the audacity to want dignity after their banker betters mortgaged the nation for the next 300 years?

Well, I say the EU/IMF/ECB/World Bank crew should do all they can do to withhold that dignity.

After all, debts must be repaid... or the whole system is gonna go down the shitter.

Unless of course you are a major bank too big to fail.

Here's the thing. Our way of seeing things is at a crossroads.

Here's another way of seeing things.

I remember the late fifties-early sixties era when my fresh-off-the-boat father worked in a factory.

Back in the day, fresh-off-the-boat DPs of all stripes could get a factory job and buy a house and a car and believe in the good life. On one household income.

Fifty years later, productivity of the working class has gone up exponentially, but working people are either not working or they've become the working poor.

But it's been a great fifty years for hedge funds and bankers and all the other pillars of the Rumpelstiltskin economy.

Good for Tsipras and Varoufakis for saying "nein danke" and refusing, on behalf of the people of Greece, to take it up the ass anymore.

I think capitalism is great. It can motivate people to do great things. But it needs to be strictly regulated. Otherwise your're going to end up with a half dozen hedgie shit-bags running the whole show.

It's time to re-organize the global economy for the benefit of humanity.

Singer v Argentina: financial crimes against humanity

Paul Singer's immoral campaign to extort unearned wealth from the people of Argentina has hit the wall.

Bankruptcy is a funny thing. I remember a real estate broker in Guelph who had survived three bankruptcies. He kept his fine home and his fancy cars throughout, and if his financial history impacted his standing in the business community, it didn't show.

On the occasion of my own bankruptcy, I recall my elderly mafioso neighbour imparting some words of wisdom; "things happen, son; sometimes you just gotta tip it and move on."

Business folks large and small routinely shift their "non-performing assets," i.e mistakes, into their weakest holding company, pull the plug, and carry on as though nothing had happened.

None of the Reichman brothers had to move house or skimp on meals when their Olympia and York flamed out in what was at the time the biggest bankruptcy in Canadian history.

However, if you hear Paul Singer tell the tale, bankruptcy by a nation state is an affront to God, and he is doing God's work when he uses the courts to put the squeeze on already-crippled national economies.

It's not that Singer lent those countries money and wants it back. The Singer M.O. is to wait till a country defaults, buy up their bonds at pennies on the dollar, and then use his vast resources and political influence to extort face value plus interest on that discounted debt.

The reason this works with a nation state and not with an individual or corporate debtor is because in theory, a nation state could amortize those debts so far into the future that eventually they would be paid. In the meanwhile, the citizens of that country will have to forgo a few frills like education and health care, but at least they're confirming Singer's idea of the rule of law.

Thus, when the people of Peru or Congo or Argentina have to do without so that Paul Singer's vulture funds can make a few un-earned billions, all is well with the world.

That's the American way!

RIP Marc Rich

Marc Rich went to his reward the other day.

Not sure what that would look like. Seems he pretty much had the "reward" while he was here.

Not a whole lot ever went too far wrong for Marc. His intellectual spawn continue his work at Glencore. The unofficial voices that talk off the record to the think tank here at Falling Downs claim he was knee-deep or better into the goings on at Glencore till the day he died.

The biggest tax fraud case in US history was resolved (sort of) by Clinton's pardon. Nevertheless Marc steered clear of US airspace, let alone US soil, for the rest of his life.

The obits claim he "invented" commodity trading. That's not quite true. He may have helped it evolve.

There were many who followed who built it into something Rich wouldn't even understand. It's one thing for sharpies in Zug to trade a barrel of oil 27 times between the well-head and the consumer.

Today's Rumpelstiltskins have their computers trade blue chips 2700 times a second.

We've come a long way...

Be that as it may, I think overall Marc Rich did more good than he did harm.

And that's probably the best legacy any man can leave behind.

'Shadow state' or New World Order?

I think a lot of the hype about the supposed New World Order is just that; overblown hype.

Elites have always run things. That's why they're called elites. In cases where an extant elite of long standing has been pushed into the dumpster of history, as in Russia circa 1917-18, a new elite rises virtually overnight. To Boris Borscht-breath at the tractor factory things looked pretty much the same the day after the revolution as the day before.

Be that as it may, here's a fascinating look into what's happening in the Eurozone right now. The fact that the article originates in the lair of the Euro-bullies just gives it extra gravitas.

Needless to say, one of the hallmarks of today's global elite is that they hail predominantly from the finance sector of the economy. Perhaps that accounts for their save-the-banks obsession. In days gone by banks were allowed to fail with some regularity. In the US alone some 9,000 banks failed during the depression.

If we view the "New European Order" as a trial run for the "New World Order" there are some heart-warming lessons to be taken away.

In the first place, it doesn't work. This should come as no surprise. While the loudest voices and highest profiles within the global elite may come from the rock-stars of finance capital, the day to day running of the machinery of governance falls to the bureaucratic class of planners, policy analysts, economists, and credential-accumulators of all stripes.

For the most part, these are folks who couldn't organize a two-car train.

As Herr Doktor Friedrich Sell points out, the European Central Bank is not a bank, but a political instrument to be used for political ends by politicians.

And reading between the lines, what both he and Thomas Mayer seem to acknowledge is this; in the event that the austerity being imposed by the stronger onto the weaker within Europe fails, there is always a plan B.

Plan B means everybody gets to loosen their belts because they'll be eating again. But, Oh My God, there will be inflation!

That could be the ruin of the finance capitalists... and the salvation of everyone else!

Let's not lose sight of the fact that well below the radar of the world's headline writers is a world far removed from the too-big-to-fail Rumpelstiltskin economy that is the focus of their obsessions. A world where real people make real things and do real stuff that other folks will pay for.

Let the Eurozone fail.

Let the big banks fail.

Let's jam sticks into the spokes of shadow states and world orders old and new.

Life will go on.

Paul Singer v. the people of Argentina

In 2008, seven years after the Government of Argentina defaulted on $95 billion in sovereign debt, hedge funds managed by Paul Singer bought up some of those defaulted bonds for pennies on the dollar. Ever since, Singer has been using the American courts in an attempt to force Argentina to pay out those bonds at face value.

This case highlights some of the more egregious abuses that finance capital imposes on its host societies. While Singer's distressed-debt investment strategy has made him a wealthy man, has it contributed anything positive to society?

No. Hedge funds like Singer's represent an opportunistic and non-productive pool of capital that seeks to turn legal technicalities and political influence into windfall gains. Hedge-funds are the Rumpelstiltskins of the modern era.

The legal system is their spinning wheel. When lawyers for Singer, a long-time Republican Party insider and huge financial backer, appear in front of judges appointed by Republican presidents, does anyone imagine that the other side will get an impartial hearing?

Where do jobs come from?

It is a universally understood "fact" that rich people create jobs. Unfortunately, rich people can only create jobs with their after-tax income. Therefore, the ultimate job-creation environment is one in which rich people pay no taxes whatsoever.

That carefully crafted ode to Joseph Goebbels' Big Lie Theory has attained the status of fact through no other mechanism than rote repetition. Watch the business networks for awhile and you will soon learn that the terms "job creators" and "rich" are 100% synonymous. This fact free-floats above empirical reality, completely immune to the demands of logic or proof.

It's just obvious.

It's just something everybody knows.

If you're a fan of the annual billionaire lists put out by the likes of Forbes et al, you will no doubt have noticed that year after year there are fewer people on that list who can claim to have had any net positive impact on job creation whatsoever. Quite the opposite. As the rise of the Rumpelstiltskin economy shows, the attainment of great wealth is more and more the province of creative paper-shufflers.

So if jobs aren't the product of rich people giving back to society in appreciation for their low tax rates, just where do they come from?

Long before the Ford Motor Company, Henry Ford was a successful engineer who tinkered with self-propelled vehicles in his spare time. Like many other inveterate tinkerers of the era, he was driven by a curiosity, quite independent from any lust for riches, to see if his experiments could rival or surpass the achievements of the other tinkerers.

That drive led in due course to the Ford Motor Company and tens of thousands of jobs being created, not because Ford was a wealthy man, but because he had come up with a product that the general population found useful.

Wealth followed.

A manufacturing enterprise will grow if it succeeds in producing a product that consumers want to buy. Once that happens, the job growth will of necessity follow.

That pattern is universal throughout the manufacturing and service industries. The Waltons, love them or hate them, didn't become America's biggest employers because they were really rich and created jobs in return for the low taxes bestowed upon them by the state. They built stores and hired people because the public had an appetite for the way they delivered consumer goods.

Wealth followed.

Real wealth has always been the result of real people providing products and services that others find useful and are willing to pay for. This holds true regardless of the marginal tax rate levied on "the rich".

The next time you hear that claim that "job creators" will stop creating jobs if they they have to pay more than 15% in taxes, remember this; the paper-shufflers objecting to paying taxes don't create jobs to begin with, and generally attain their wealth through non-productive economic activity. Taxing speculators and hedge fund artists at 100% would have utterly no impact on job creation.

So let's tax them!

Greeks will leave Euro, end of world nigh

It's all over the news, except they're still mostly sliding in the modifier "might".

Ain't no "might" about it.

The people have had enough of the austerity enema.

According to the mainstream scare-mongers, once Greece says goodbye to the Euro and welcome back to the drachma, all hell will break loose.

And I'm quite sure the "global capital markets" will do some serious heavy breathing.

Not to worry.

Underneath that Rumpelstiltskin economy that thrives by passing paper around a daisy chain of insiders, there is still a real economy where real people make real stuff and provide services that really matter.

In the short term, global capital markets will indeed have a shudder.

In the long run, the people who can do real stuff and provide meaningful services will be fine.

But a lot of straw-spinners will be out of work.

London Whale takes aim at global economy

He's big, really big.

He's so big they call him the London Whale.

His name is Bruno Iksil and he works in the London offices of JP Morgan.

Having failed in their 2008 attempt to derail the worlds financial system, the gnomes in the Rumpelstiltskin Economy are having another go at it, and Iksil is the chief straw-spinner of the moment.

The London Whale is so busy in the credit derivatives market that the entire 10 trillion dollar edifice is trembling.

Credit derivatives. Little nutritional value. Won't keep you warm on a cold winter night. Won't fix your toothache or your migraine. Very little practical value at all when you get down to it.

But they do serve to make the gnomes very wealthy. Any derivatives trader worth his salt takes home a bigger pay packet in a year than a teacher or a nurse or a plumber is going to take home in their lifetime.

And when things go wrong we all pay.

Meanwhile, JP Morgan chief Jamie Dimon is super busy these days lobbying against new regulations that are intended to prevent the catastrophic melt-down we saw in 2008.

I'm sensing deja vu all over again...

The meanings of meaningful work

In my world meaningful work is when you do something that is useful to others in society. When you build a deck or renovate a bathroom you are doing meaningful work. When you drive a truckload of turnips from Ontario to Ohio you are doing meaningful work. When you teach children how to read and write you are doing meaningful work. When you do emergency room surgery that saves lives you are doing meaningful work.

When you look at the top 1% of income earners, what you don't find a whole lot of is meaningful work. Hedge-funders. Lawyers. Accountants. The entire accounting profession is a leech on the economy of meaningful work. If you had a straight-forward and fair tax code you wouldn't need accountants. You'd need book-keepers. Book-keeping is useful and necessary work. Accounting is in one way or another an accessory to tax evasion.

But the laws of the land are skewed to preserve the privileges of the 1% at the expense of the rest of us. Not hard to see why. When Bush or Obama or Romney or Clinton has a $25,000 a plate fund-raiser, it's the 1% buying 100% of the tickets. It ain't the kid who just got a job at the car plant at fourteen bucks an hour.

Most of us realize that this isn't how democracy should work. After all, how can that 1% tail be wagging this big fat dog? That's where the fear comes in. If it ain't the commies it's the fags. If it ain't the fags it's the Mexicans. If it ain't the Mexicans it's the Muslims.

THEY HATE YOUR FREEDOM!

That would be the freedom to work two or three shit jobs trying to pay the bills.

The freedom to be tased for driving while Black.

The freedom to have your grandmother groped before she flies from Tampa to Atlanta.

The freedom to serve Freedom in Iraq or Afghanistan because there are no jobs in Michigan.

The freedom to go bankrupt when your kid is diagnosed with leukemia at five years old.

The freedom to live under a tarp when the bank your taxes bailed out forecloses on your house.

The freedom to protest in a "free-speech" cage at the G20 meetings.

The freedom to eat dog food when you're old.

That's America baby.

Love it or leave it!

And for God's sake lets give that 1% a break already.