{"article":{"id":261218,"heading":"Wall Street plunders Detroit while pensioners take blame","author":"Systemic Disorder","created":"2013-08-08 03:23:03","modified":"2013-11-11 01:12:10","last_modified":"Mon, 11 Nov 2013 09:12:10","article":"

The Detroit bankruptcy has been portrayed as a simple morality tale of city mismanagement, but the crucial role of financial industry chicanery has been conveniently ignored. Municipal debt is a largely unknown but very lucrative field — lucrative, that is, for speculators.

There are so many questions that can be asked about Detroit’s bankruptcy filing. What is Wall Street’s role in municipal debt? How is it that almost $300 million is available for a new ice hockey arena when there is no money for pensions? How is that business taxes can be cut by 80 percent at a time of fiscal crisis? Why did the total of pension liabilities suddenly increase fivefold from earlier this year?

These are questions that are rarely raised in the corporate media. Asking such questions disarms the narrative of public-employee retirees bleeding taxpayers dry and masks larger systemic issues. It is quite difficult to believe the same folks who brought you the economic crash of 2008, and five years and counting of hard times, are completely innocent of fleecing local governments. Indeed, they are not.

Municipal bonds are big business — $3.7 trillion. Yes, you read that correctly — trillions of dollars. That is one big pot of money to tap, and tap it financiers do.

To continue reading, please go to http:\/\/wp.me\/p2cpPS-6n<\/a>.

<\/p>\n","contact":"","link":"https:\/\/systemicdisorder.wordpress.com\/","address":"","phone":"","parent_id":0,"mime_type":"text\/plain","summary":"In North America, Detroit fulfills the same function as Greece does for Europe: A scapegoat. Larger economic and social forces, disinvestment and financial industry legerdemain are the major factors in Detroit\u2019s financial struggles.","numcomment":3,"fileurl":"\/uploads\/","filesize":null,"article_url":"\/news\/2013\/08\/261218.php"},"attachments":[],"comments":[{"id":261219,"heading":"Democrats","article":"Democrats\/Progressives\/Unions\/Incompetent local government killed Detroit. Wall Street didn't have a fucking thing to do with it. It is the natural outcome of socialism and progressive stupidity.","author":"nonya","parent_id":261218,"mime_type":"text\/plain","created":"2013-08-08 07:20:33","modified":"2013-08-08 07:20:33","fileurl":""},{"id":261220,"heading":"@nonya","article":"That's the stupidest shit I've ever read. The main reason why Detroit failed is an overdependence on one industry: autos and related machines. The region lacked sufficient economic diversity.\r\n\r\nThis collapse took over 30 years. In those 30 years, Detroit didn't really have it together to develop a global industry.\r\n\r\nThe "why" of that is a lot harder to guess. I would suspect that they saw the robots and computers being more important, but they didn't have what it took to establish a robot business. The main "raw material" of robots is engineering, and the "factories" that produce engineering are universities.","author":"nobody","parent_id":261218,"mime_type":"text\/plain","created":"2013-08-08 09:49:50","modified":"2013-08-08 09:49:50","fileurl":""},{"id":261229,"heading":"Municipal bond market manipulation","article":"The Scam Wall Street Learned From the Mafia.\r\n\r\nhttp:\/\/www.rollingstone.com\/politics\/news\/the-scam-wall-street-learned-from-the-mafia-20120620\r\n\r\nWidespread corruption in the municipal bond markets.\r\n\r\n\r\n\r\nBid-rigging skims from towns after they\u2019ve already borrowed money through bond issues. But some communities insist they\u2019re being skimmed before they borrow as well. The central complaint is that the credit ratings of municipalities are excessively low, compared with counterparts in the corporate market who have the same risk of default. If true, this would artificially hike borrowing costs for cities and towns.\r\n\r\n"Virtually every major bank and finance company on Wall Street \u2013 not just GE, but J.P. Morgan Chase, Bank of America, UBS, Lehman Brothers, Bear Stearns, Wachovia and more \u2013 these three Wall Street wiseguys spent the past decade taking part in a breathtakingly broad scheme to skim billions of dollars from the coffers of cities and small towns across America. The banks achieved this gigantic rip-off by secretly colluding to rig the public bids on municipal bonds, a business worth $3.7 trillion. By conspiring to lower the interest rates that towns earn on these investments, the banks systematically stole from schools, hospitals, libraries and nursing homes \u2013 from "virtually every state, district and territory in the United States,"\r\n\r\n\r\nthis report -http:\/\/www.gpo.gov\/fdsys\/pkg\/CRPT-110hrpt835\/html\/CRPT-110hrpt835.htm\r\n\r\nprepared by the House of Representatives four years ago \u2013 look at page 5 in particular, in the table for "Cumulative Historical Default Rates" \u2013 you\u2019ll see that munis consistently receive significantly lower ratings than comparable corporate bonds.\r\n\r\n\r\nThere have been a number of major civil lawsuits filed over the LIBOR issue, and as in the muni bid-rigging scandal, the list of defendants in these civil cases (see here for example) reads like a Who\u2019s Who of the top banks in every major western country: Bank of America, Citigroup, Chase, Bank of Tokyo-Mitsubishi, Barclays, Lloyds, Rabobank, Credit Suisse, and Royal Bank of Canada, among others.\r\n\r\n\r\nTo me the most disturbing thing that came out in the Carollo trial was how easy it is for financial companies to rip off cities and towns once they start cooperating. Municipalities really have no defense against this sort of behavior; it\u2019s not like they can arrange the bond issues themselves. So it surprises me that there hasn\u2019t been more of an uproar from local officials over this behavior.\r\n\r\n\r\nBankster Lobbyists Writing Regulatory 'Reform' Legislation\r\n\r\nhttp:\/\/antifascist-calling.blogspot.co.nz\/2013\/05\/bankster-lobbyists-writing-regulatory.html\r\n\r\n\r\nNew Sleaze Allegations Tarnish JPMorgan Chase's 'Teflon Don'\r\n\r\nhttp:\/\/antifascist-calling.blogspot.co.nz\/2013\/05\/new-sleaze-allegations-tarnish-jpmorgan.html\r\n\r\n\r\n..and more here :\r\n\r\nNotes on Wall Street's Bid-Rigging Scandal\r\n\r\nhttp:\/\/www.rollingstone.com\/politics\/blogs\/taibblog\/notes-on-wall-streets-bid-rigging-scandal-20120622\r\n\r\n\r\n","author":"crazy_inventor","parent_id":261218,"mime_type":"text\/plain","created":"2013-08-08 17:17:33","modified":"2013-11-11 01:12:10","fileurl":""}]}