The spirit of graft and lawlessness is the American Spirit.Last night’s late night news on BBC2 (22/1/08) had five ‘experts’ pontificating on about the ‘business cycle’ and they spent around twenty minutes trying avoid explaining where Capitalism was headed and whether anybody or institution had any control over it. They failed miserably, talk about empty heads talking, it was an embarrassing display of denial, something the BBC is really good at,— Lincoln Steffens, The Shame of the Cities, 1902
‘Stock indexes are set to be highly volatile in coming weeks, they warned.’Volatile? At least that’s what the European Central Bank and the Bank of England are telling us. Volatile is bank-speak for powerless. If you judge the latest crisis of capital accumulation by the headlines in the ‘business’ section of the MSM, you could be excused for thinking that it’s all down to jittery investors what with statements like,
“The uncertainty about corporate earnings growth in 2008 has risen, not only in the financial sector,” said Matthias Schellenberg, managing director at ING Investment Management. “The markets are expecting a flood of profit warnings in the next few months.”
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‘That's a tricky one.’In other words, nothing can be done about it, followed by a series of anodyne ‘answers’ to the question which reveal two things about corporate media coverage of capitalist economics:
1. Never call a recession a recession, just keep on saying that it’s ‘around the corner, maybe’, a ridiculous response given that we are already in a recession as any fool can see.
‘The big question is whether we are just seeing a bad month for shares - or whether this is the start of a bear market that could see share prices sliding for years.’So questions get answered with, you guessed it, more questions.
2. Blame it all on the ‘sub-prime mortgage’ scandal but don’t even begin to question the real cause of ‘cheap’ credit. The BBC’s Q&A page says,
‘All of the problems were kicked off by record levels of defaults on sub-prime mortgages in the US. ‘Sub-prime mortgages are [were] offered to people with inferior credit records or unpredictable incomes.’It goes onto say that,
‘It turned out that US lenders had been repackaging the debt and selling it to banks worldwide. The default levels meant that the repackaged debt was of questionable value.’‘Questionable value? Repackaging? It turned out!’ But it stands to reason that if you lend money to people who haven’t a hope in hell of repaying it (as they were conned into the deals in the first place) then the result is inevitable; repossessions and the inevitable collapse of the housing market (and then some).
Contrast the BBC’s innocuous description of the situation with the following,
‘President George W. Bush called for $145 billion in tax cuts, describing the measures as a “shot in the arm” for the U.S. economy, which caused stock values to plunge in Australia, Tokyo, Hong Kong, China, and across Europe. “There's something approaching panic in the market,” said an analyst with Bank of America.’What the BBC doesn’t explain is its disengenuous description of bad debts as ‘repackaging’, in other words, burying the damn things in financial ‘instruments’ so complex that nobody has any idea where these bad debts actually are (devised by a bunch of greedy nerds with useless degrees in economics and business ‘management’).
— Source: ‘The News Dissector’, 23 January, 2008
‘Fraud, corruption and racketeering went so deep as to make an important contribution to the greatest single crisis the United States faced during the 20th century — the Great Depression.’ — ‘Gangster Capitalism – The United States and the Global Rise of Organized Crime’, p.54Move over Halliburton, been there, done that.
But the real cause can be traced back to the ‘de-regulation’ of the financial markets and especially the banking sector. ‘De-regulation’ is just news-speak for the legalisation of what used to be a crime and obviously with good reason (remember the Savings & Loan crisis of the 1980s? See my ‘Bush Family Connections: Silverado Savings & Loan Scandal’, itself the first major effect of de-criminalising, sorry, deregulating the laws governing the actions of the financial sector).
In turn, it reveals the simple fact that capitalism is fundamentally a criminal endeavor of grand proportions, one that makes the ‘Mafia’ a bunch of amateurs (See ‘Selling the biggest lie of them all – Capitalism’, my review of ‘Gangster Capitalism – The United States and the Global Rise of Organized Crime’ by Michael Woodiwiss).
It was only because of the ‘29 Crash that under Roosevelt’s ‘New Deal’ the state imposed regulations on the business ‘community’, for just as with today’s meltdown, the ‘29 Crash was caused in large measure by the criminal actions of the capitalist class, the self-same laws that were abolished in the 1980s. So what goes around, comes around eh.
‘The number and variety of rackets in the United States during the 1920s and early 1930s was vast. Many Americans knew or at least suspected that politicians, judges, lawyers, bankers and business concerns collected many millions of dollars from frauds, bribes and various forms of extortion.’ — ‘Gangster Capitalism – The United States and the Global Rise of Organized Crime’, p.47The irony of ‘de-regulation’ is that it came about as a result of the last major crisis of Capital, the so-called Energy Crisis of the early 1970s and the falling rate of profit following the actions of countries like IRAQ in nationalising their oil industry and of OPEC raising the price of oil.
“Do we want the communists to own the banks, or the terrorists?” asked financial commentator Jim Cramer. “I'll take any of it.”Neo-liberalism, letting the market decide and ‘de-regulation’ is just a polite way of describing Gangster Capitalism or back to business as usual before those damn Commies interfered with a good thing.
Thus the BBC, along with the rest of the capitalist press, dare not speak the ‘credit crisis’ by its real name — Capitalism, nor obviously the real history of ‘boom and bust’ lest we, the public finally cotton to what’s going on and who will the pay the price, as ever, the poor of the planet.
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