Al Guardian of Palestine and Wall Street

[Loki]

Hmm, an interesting suggestion, Loki. I think that there are better ways to address it than a tax, though, since it requires pretty complex definitions that will change with financial innovation. Why not just increase reserve ratios and stringency for larger institutions? Ignore the level of 'risk' as too tough to quantify, but just make any institution large enough to require a bailout (and thus have an implicit subsidy and a significant moral hazard problem) to insure themselves against a problem by requiring a much higher tier 1 capital ratio. There can be penalties for dropping below the ratio, which can be used to fund a 'bailout fund', similar to FDIC.

Then you're just punishing someone for being big, not for engaging in the kind of behavior that produces the negative externality. All you're doing is shifting the risk-taking to slightly smaller institutions.

Another way to avoid the risk issue is to insist that banks spin off riskier programs (e.g. in-house trading) to smaller subsidiaries with no direct financial connection, which means their risky trading arms can go down without jeopardizing the bank itself. Something like the original provisions of Glass-Steagall.

I'm not convinced even the spun off programs would be allowed to fail. There is too much interdependence and too many different types of transactions interwoven with one another. We don't even know what will happen if institutions holding certain kinds of instruments go bust.

(Separately, I think the idea of an EU financial transaction tax is a good way for other financial centers to make a lot of money, including the US and Swiss, to the detriment of the UK and a few smaller banking centers.)

I agree. This is stupid idea from the EU; it's not taxing the source of the problem and it's trying to tax an industry that's incredibly mobile.

[wiggin]

Then you're just punishing someone for being big, not for engaging in the kind of behavior that produces the negative externality. All you're doing is shifting the risk-taking to slightly smaller institutions.

Uh, no, that's not true. There's a huge moral hazard problem here for anything 'too big to fail'; it makes sense to take steps to ensure that they don't fail even if our current risk models (which may be wrong) indicate it's unlikely. Just look at the stress testing of European banks - it was explicitly designed to find out how risky their assets are, and it was full of holes and rosy assumptions. Why assume the US can do better? The negative externality is the moral hazard issue, and you can't get rid of that without breaking up banks. I normally agree with Pigovian taxes, but it's very hard to quantify the externality here, so I'd prefer to just go for a bigger safety net and leave it at that.

This isn't a 'punishment', it's evening out the playing field for smaller institutions that won't be saved if they go under. (Those smaller institutions also won't take up the risk-taking since the have no implicit subsidy.)

I'm not convinced even the spun off programs would be allowed to fail. There is too much interdependence and too many different types of transactions interwoven with one another. We don't even know what will happen if institutions holding certain kinds of instruments go bust.

I agree, that's the main concern with this approach. Even if the core of the financial institution is still relatively sound, there will still be imploding assets of X type all over, which will ravage plenty of balance sheets.

[GGT]

It's a lot of backward looking anger though, and as such not really contributing a whole lot to the solution.

Not that I disagree with the sentiments though, not so long ago some bonus guzzlers in pinstrips would have been swinging from the lanterns. I still can't get over the fact that nobody is held liable for the monumentally wrong decisions that might still push the world's economy into the abyss.

It's surprising that it took this long for protests, or at least for Americans to Wake Up. If Dept. of Justice or SEC had hauled several culprits to court and sent them to prison, I wonder if people would have been lulled back into apathy? That happened after the S & L bust, Enron and Worldcom, Milken and Boesky....a few regulatory changes were made, some crooks were thrown in the can....and financial finagling continued.

After a huge financial crisis like this last one, coupled with The Great Recession (or the Great Contraction, whatever name it has now) no one has been held "accountable", prosecuted, or held liable. Most of the same actors still have their jobs, million dollar bonii, and golden parachutes. Pretty amazing, huh? I think that's a large part of the general anger that's finally showing and fueling the Occupy movement. It's about damn time.

[Loki]

I see you've found a new anti-establishment cause to latch on to. What's next? Communism? Fascism? Scientology?

[GGT]

I see you've found a new anti-establishment cause to latch on to. What's next? Communism? Fascism? Scientology?

Are you saying I haven't been consistent over the years, or that you just don't know how to confront challenges presented to your academic field, now that your field is being challenged in a big way?

[Loki]

Your only consistency is in being anti-establishment and in supporting which ever anti-establishment clause happens to be popular at the moment. You ignore the fact that the solutions your causes put forth are wildly inconsistent with one another.

My field is IR, and the main problem facing it is unreliable data, not real-life events (though I would imagine comparativists do have eggs on their face from the Arab uprisings).

[GGT]

Your only consistency is in being anti-establishment and in supporting which ever anti-establishment clause happens to be popular at the moment. You ignore the fact that the solutions your causes put forth are wildly inconsistent with one another.

The bolded part is exemplary or your world view, not mine.

My field is IR, and the main problem facing it is unreliable data, not real-life events (though I would imagine comparativists do have eggs on their face from the Arab uprisings).

Whatever helps you sleep well at night, huh. You've spent several years getting your PhD, leveraging most of your young adult years in exchange for....what? Unreliable "data"? Diplomacy vs Drones?

I have no idea how an advanced academic in the field of International Relations can say the main problem in the world is not Real-Life events, but moral relativists, with egg on their face (humiliation). That's backward.

[Loki]

The bolded part is exemplary or your world view, not mine.

By that you mean that I deal with facts while you deal with fantasy? Is it really that hard to grasp that the solutions put forth by Perot, Kucinich, Paul, and the we hate wall street crowd are wildly at odds with one another? You don't really expect to be taken seriously when you jump on the bandwagon of every anti-establishment group, regardless of their actual platform, do you?

Whatever helps you sleep well at night, huh. You've spent several years getting your PhD, leveraging most of your young adult years in exchange for....what? Unreliable "data"? Diplomacy vs Drones?

I have no idea how an advanced academic in the field of International Relations can say the main problem in the world is not Real-Life events, but moral relativists, with egg on their face (humiliation). That's backward.

I should have gotten a factory job instead and done real, productive work.

[Nessus]

I should have gotten a factory job instead and done real, productive work.

Don't worry, there's plenty of fascists running around being Important and Serious that soon enough, you'll find yourself doing factory work, too...

[Loki]

As shall you Fraulein Nessus von Finnland.

[Nessus]

I will more likely die of exposure after being expelled from a train by the national train service that seems to regard customers as a minor inconvenience.

[GGT]

By that you mean that I deal with facts while you deal with fantasy? Is it really that hard to grasp that the solutions put forth by Perot, Kucinich, Paul, and the we hate wall street crowd are wildly at odds with one another? You don't really expect to be taken seriously when you jump on the bandwagon of every anti-establishment group, regardless of their actual platform, do you?

I should have gotten a factory job instead and done real, productive work.

What's that mean? The closer you get to defending your doctorate, the easier it gets to dismiss everyone else as any old anti-establishment crack-pot? Because we just don't view the world as academics insist we should?

You should be asking yourself why YOU should be taken seriously, when your field of expertise has been proven less than "expert". People 'like you' have advised leaders (like Bush or Obama) to act offensively, to our detriment. After you defend your PhD, you'll be asked to defend your ideology, to The American People. And you'll be watched like a hawk, by millions of people, in a way Kissinger never was.

[Aimless]

You know, I snuck back here to ask if it wouldn't be good to set things up so that the greatest risk-taking became the purview of the smallest players rather than the largest, and here it looks like you guys want the exact opposite. I'm confused. When these players inevitably fail due to stupid behaviour, underestimation of risks and a powerful drive to make up for the speed-bumps and stop-signs you'll put up, wouldn't it be better to have small failures rather than spectacularly huge ones? With only small failures being likely you'd at least have some hope of being able to work with reasonably accurate models

[Loki]

What's that mean? The closer you get to defending your doctorate, the easier it gets to dismiss everyone else as any old anti-establishment crack-pot? Because we just don't view the world as academics insist we should?

You should be asking yourself why YOU should be taken seriously, when your field of expertise has been proven less than "expert". People 'like you' have advised leaders (like Bush or Obama) to act offensively, to our detriment. After you defend your PhD, you'll be asked to defend your ideology, to The American People. And you'll be watched like a hawk, by millions of people, in a way Kissinger never was.

By "we", don't you mean just you? You've gotten awfully presumptuous lately. Hint: a vast majority of the country doesn't agree with you and certainly doesn't have the same thought process as you.

[Hazir]

By "we", don't you mean just you? You've gotten awfully presumptuous lately. Hint: a vast majority of the country doesn't agree with you and certainly doesn't have the same thought process as you.

So, just to have a jibe at her, you're going to deny you too are one of those people feeling uneasy about socialized losses after private profits were cashed? I think she is far from being in the minority. A small minority is camping out to show their disgust. And they may be on the fringes of political life, but a vast majority of people is just as utterly disgusted about the way the present crisis came about.

[Loki]

So, just to have a jibe at her, you're going to deny you too are one of those people feeling uneasy about socialized losses after private profits were cashed? I think she is far from being in the minority. A small minority is camping out to show their disgust. And they may be on the fringes of political life, but a vast majority of people is just as utterly disgusted about the way the present crisis came about.

Have you read her actual comments in this thread? This isn't about socialized losses; it's about her coming up with a whole new list of problems and solutions whenever a new anti-establishment movement arises, and then pretending that there's nothing contradictory about her support for movements that have nothing in common other than being anti-establishment.

[Aimless]

this doesn't have to be a problem for someone who isn't committed to any particular solution. If, say, her basic thesis is, "Things suck, it makes me angry, something should be done." Eg. someone should be thrown in jail or something.

[Loki]

Except according to anti-establishment ideology #1, a given policy can bring about a utopia, while for anti-establishment ideology #2 is can bring about a dystopia. She doesn't seem to care as long as the status quo gets changed. Just think what Ron Paul would think about the proposals of the anti wall street crowd.

[GGT]

By "we", don't you mean just you? You've gotten awfully presumptuous lately. Hint: a vast majority of the country doesn't agree with you and certainly doesn't have the same thought process as you.

Referring to your field of expertise, international relations, and our decade-long deployments in Iraq/Afghanistan---a majority of the US wants our troops home, without a prolonged exit to train their armies, police or 'foreign nation building'. A large number of Americans want to cut military spending first, instead of gutting public service spending first.

Except according to anti-establishment ideology #1, a given policy can bring about a utopia, while for anti-establishment ideology #2 is can bring about a dystopia. She doesn't seem to care as long as the status quo gets changed. Just think what Ron Paul would think about the proposals of the anti wall street crowd.

Using words like utopia/dystopia is disingenuous, to dismiss or de-legitimize the Occupy protests. Use words like help/hurt and you've just described congressional disagreements between Democrats and Republicans, and their ideas of government policies in society.

Ron Paul would approve of the peaceful protests, the groups carrying signs End the Fed, and End the War. The Occupy Wall Street crowd hasn't made any demands or specific proposals. But Bernanke, Geithner, congress....the IMF, ECB, Merkel and Sarkozy....finance ministers and bankers have. Looks like they're all trying to change the status quo, too.

[Aimless]

With the provision that they remain relevant, of course

[Flixy]

I found this bit pretty amusing:

http://www.thedailyshow.com/watch/tu...8-2011/the-99-

[Draco]

"This content is unavailable from your location." This isn't the first time that I couldn't view some online video on a website from another country...I don't know why but my two guesses are: government intervention/regulation (well there was talk of some internet filter a while back LOL), or the actual site itself has barred Australian users to view it?

So I saw/read some news report of people pouring out onto the streets in Europe, as a part of this "we are the 99%" movement, and was reminded why I avoid watching the news. All I saw were a mass of people in nice clothes, waving signs around and then listening to some random person talking about how they're the 99%. Can someone break it down for me what the fuss is about? Are they upset that they're not in the "1%", that they don't get a share of other peoples money? Is it that they're out of work due to the latest financial crisis/recession? Are they fed up with corruption? Are they sick of the government bailing out irresponsible banks/companies/idiots ?? Which one is it, because there's a resounding theme of "anti-capitalism" and a lot of people seem to be protesting for the sake of protesting, so that some day in the future they can say "Yep I was there, I did something *pats self on back*"

Some of the photos from London are interesting:

Check out the guy holding the sign "unite" (watch out, big statement there), he's got one of those trendy caps, trendy glasses, a trendy scarf and a nice looking coat to top it all off. I don't own that type of clothing, but that must have something to do with me not being in the 99% so I should partake in these protests too, surely! I'd like a pair of Ray Ban sunglasses, trendy scarf, cap and matching coat, it's my right isn't it?


Oh and this one's good too:


Proves my point that people are just going for the sake of it. Like when there's a fight at school, everyone gravitates towards it so they can have something to talk about afterwards.

Oh right, this one made me laugh


Gotta love one of the comments on that site though: "As so many times in history a good old 'Peasants Revolt' is underway."

[Aimless]

I think the safest answer to your question is, "All of the above."

[Ominous Gamer]

I like how Draco assumes only the worst off of society should be allowed to protest when they feel they are living through something that isn't right. And he arrived from that conclusion from a picture of someone who looks like your regular thift store hipster (but I do love the damned if you do attitude, poor clothes = poor message, good clothes = bad protestor). Hell, I don't think Draco is understanding what he is seeing in any of these pcitures

Anyway, to kill your first conspiracy theory, dailyshow is blocked for you because of copyright and distribution rights of that company.

[GGT]

I loved the Occupy the World little old lady in the Daily Show clip.

[GGT]

Bank of America Deathwatch: Moves Risky Derivatives from Holding Company to Taxpayer-Backstopped Depository

http://www.nakedcapitalism.com/2011/10/bank-of-america-deathwatch-moves-risky-derivatives-from-holding-company-to-taxpayer-backstopped-depositors.html

Is anyone still wondering why there's an Occupy Wall Street movement?

[coinich]

Bank of America Deathwatch: Moves Risky Derivatives from Holding Company to Taxpayer-Backstopped Depository

http://www.nakedcapitalism.com/2011/10/bank-of-america-deathwatch-moves-risky-derivatives-from-holding-company-to-taxpayer-backstopped-depositors.html

Is anyone still wondering why there's an Occupy Wall Street movement?

There's clearly two solutions. 1: Stop using BoA. 2: Stop having the government insure BoA.

[Ziggy Stardust]

Hi guys.
What are you doing here?
I'm here for the protest man.
Not with those Ray Ban sunglasses, trendy scarf, cap and matching coat you're not

[Aimless]

I can't get my head around those numbers. They are too big for me to comprehend

[GGT]

I can't get my head around those numbers. They are too big for me to comprehend

Millionaires Control 39% of Global Wealth

By Robert Frank

Here’s another stat that the Occupy Wall Streeters can hoist on their placards: The world’s millionaires and billionaires now control 38.5% of the world’s wealth.

Credit SuisseClick to enlarge

According to the latest Global Wealth Report from Credit Suisse, the 29.7 million people in the world with household net worths of $1 million (representing less than 1% of the world’s population) control about $89 trillion of the world’s wealth. That’s up from a share of 35.6% in 2010, and their wealth increased by about $20 trillion, according Credit Suisse.
The wealth of the millionaires grew 29% — about twice as fast as the wealth in the world as a whole, which now has $231 trillion in wealth.
The U.S. has been the largest wealth generator over the past 18 months, according to the report, adding $4.6 trillion to global wealth. China ranked second with $4 trillion, followed by Japan ($3.8 trillion), Brazil ($1.87 trillion) and Australia ($1.85 trillion).
There are now 84,700 people in the world worth $50 million or more – with 35,400 of them living in the U.S.. There are 29,000 people world-wide worth $100 million or more and 2,700 worth $500 million or more.
The fastest growth in the coming years will be in China, India and Brazil. China now has a million millionaires. Wealth in China and Africa is expected to grow 90%, to $39 trillion and $5.8 trillion respectively, by 2016. Wealth in India and Brazil is expected to more than double to $8.9 trillion and $9.2 trillion respectively.