Saturday, December 10, 2011

The Street

I wrote this poem/song lyrics in September 2009, eight years after the attacks of 9-11. The Crisis of Finance Capital was still in the headlines. Stock Markets had started to crash in October 2008, with no bottom in sight. Credit and commerce froze, although war funding continued, unaffected.  The government & the Federal Reserve responded with TARP, interest rates near zero, and various guarantee programs available only to the big financial institutions.  The S&P 500 index hit bottom in March 2009. Money continues to flood Wall Street while no effective programs reach the devastation in the rest of the country.

On nine-eleven Wall Street fell
People burned, people jumped
Bodies rained -- on the Street

Men and women went to War
Support our Troops

Free Markets cannot die they said
Traders traded, brokers brokered
Finance Capital revived, Shadow Bankers thrived
CDOs SIVs ABSs flowed throughout the globe
Bonuses rained -- on the Street

Men and women fight in War
Support our Troops

Overleveraged credit froze
Global gears seized up
The lubricant of money flowed no more
Brother -- lend me a dime
Uncle Sam -- lend me a billion

Men and women fight in War
Support our Troops

The death of Finance we must forestall
Not the time for strings or regulations
Taxpayer funds flood the Street
The gears unlock, credit flows, and yes, of course
Bonuses rain again -- on the Street

Brother lend me a dime
I paid my taxes, my mortgage I cannot pay

Men and women die in War
Support our Troops
Support the Street

Tuesday, November 15, 2011

Violent Eviction of OWS NY 11/15/11

Below is an eyewitness report of what happened in Liberty Square (Zuccotti Park) last night, excepted from

 <<<< Last night, I watched lower Manhattan turn into a militarized lockdown. The park known as Liberty Square was apparently cleared by force, though I arrived 20 minutes after the police barricades encircled a two-block radius, kicked out all media and prevented all foot traffic on public sidewalks surrounding the park.

This was expected. The emergency text message went out at 1:00 AM and read, "URGENT: Hundreds of police mobilizing around Zuccotti. Eviction in progress!" prompting a mass mobilization of people like me, part-time protesters who signed up to converge on the park for the looming police raid on the physical heart of the Occupy movement.

The police were prepared for this flood of bodies. Many subway stops were shut down, as was the Brooklyn Bridge. My go bag had been packed for weeks, waiting for just this moment. I laced up my boots, and spent an agonizing 20 minutes on the subway from Brooklyn.

Upon arrival in lower Manhattan, I struggled for about two hours to get to a position where I could see into the park, to no avail. From a block away, I saw massive piles of what used to be supplies dumped into waiting trucks. People's major concerns were two-fold: first, the health and safety of the occupiers locked in the camp; and second, the 5,000 books of the Occupy Wall Street library. What a picture it would be (maybe it exists) of police in riot gear gathering boxes of donated books and loading them into garbage trucks. A perfect metaphor for what appears to be the intention of last night's raid: destroying the body of knowledge that had been collected by a movement just two months old, which was built by collective effort, literally from the ground up.>>>>

Me again -- The occupiers had created a microcosm of a civilized democratic society in the park w/ everyone having a voice in the general assemblies. They had a library of over 5,000 books, a communal kitchen, medical center, legal aid center, & various committees like security details, cleanup etc. In the past few days the NY police policy has been to encourage drunks & street people (many of who have psychological problems) to go down to Z park. This created problems which the internal OWS security had difficulty handling & provided one of the excuses used to eliminate & "sterilize" the park.  Democracy Now was the only news organization on site recording the eviction -- see their video report.

It was heartbreaking for me to see the structures and especially the 5,000 book library bulldozed and loaded onto dump trucks. The mayor of Oakland admitted that these actions were coordinated with 16 other cities across the US, where police destroyed the OWS locations and arrested numerous protestors.

How terrified the 1% must be to use such force against peaceful protests guaranteed by the first amendment. Was Homeland Security involved in these actions? This of course was the least effective tactic the 1% could have used to achieve their goal of shutting down the OWS movement. In their violence they  achieved the opposite -- this will increase the movement's momentum.

The lives of the 99% will not improve with current policies so the OWS message will increasingly become more relevant to more & more people.

Saturday, October 29, 2011

Bank of America Losses Socialized Again?

On September 21, 2011, Moody's dropped Bank of America’s long-term senior debt two notches to Baa1, placing it three notches above junk status.

The NY Post reported that BAC shifted trillions of dollars of derivatives into their FDIC insured unit. The SF Business Times reports the amount transferred was $55 trillion of risky derivatives. They call this move by BAC unsurprising, since ratings downgrades often trigger calls for more collateral from derivatives holders who want to ensure their counterparties are good for the money if they have to pay up.

The important point here is that the collateral BAC is putting up to back those derivatives is FDIC insured deposits, which again puts taxpayers on the hook. The Post reports that "the derivatives transfer has irked officials at the FDIC". Supposedly the FDIC is reviewing the transfer. If the decision is to let the transfer stand then taxpayers may have to cover the losses incurred by insured depositors (now the collateral) when the derivatives tank. If the decision is reversed in taxpayer favor (I don't hold my breath for that) Bank of America and/or the derivatives counterparties are at risk for huge losses.

Some additional perspective - Bank of America acquired Countrywide in July 2008 and Merrill Lynch in September 2008. BAC now has Countrywide's failing subprime mortgages on its books. With Merrill it acquired trillions of dollars of derivatives.

And to give all this some context here are some astounding figures:

$ 75 Trillion     BAC derivatives
$ 63    "            Global GDP
$ 14.5  "          US GDP
$ 16.2   "         EU GDP
$  5.9    "         China GDP

Source ICC/IMF via Capital Account at

Thursday, October 27, 2011

Is it Greed or is it The System?

In an article in The Guardian, Slavoj Žižek states: "The problem is not corruption or greed, the problem is the system that pushes you to be corrupt."

Žižek is absolutely correct. The OWS calls for ending greed & corruption are off the mark. It's the system (the current form of capitalism) that sets up the environment for greed & corruption to flourish. Actually the system demands it as the rate of profit falls. The globalization of the labor market has produced a downward spiral in wages and the financialization of the US economy - money making money, in other words - speculation: CDOs, ABSs, SWAPS, astronomical leverage and so on.  This is the formula for financial crises, each more drastic than the prior one. Is the disintegration of the Eurozone our next crisis?