By RICHARD BARLEY

Finally, a chink of light. Dubai World has belatedly provided some of details on its planned debt restructuring.

But for investors the situation still resembles a darkened room, where the outlines of the furniture are now visible but little else. And for Dubai itself, there is more than just the future of $26 billion of debt at stake. The emirate’s credibility as a financial center and its ability to continue financing good businesses, such as ports operator DP World, will hinge on its handling of the crisis.

Tuesday brought some good news. The $26 billion of debt affected is less than the $60 billion feared last week. Even so, questions linger. The restructuring process will include Dubai World itself and property developers Nakheel World and Limitless World. Analysts at Barclays Capital have identified $8.5 billion of debt at Nakheel, $5.5 billion at Dubai World and $1.2 billion at Limitless. That still leaves $10 billion unaccounted for. It may be in bilateral bank loans where there is no public disclosure. But it still leaves creditors unsure of their position.

It is also encouraging that Dubai World intends to adopt a policy of regular communication, though again the process lacks detail. For example, it is unclear whether the six-month standstill requested from creditors is voluntary or enforced. Given the looming Nakheel maturity — just two weeks away — it will be a challenge to secure creditor agreement in advance. If some lenders reject a stand-still it could trigger another bout of uncertainty and bondholders are organizing themselves for battle: a group holding 25% of the Nakheel bonds has hired Ashurst as a legal adviser.

Dubai’s strategy relies on ringfencing certain key businesses from the general restructuring — possible because of the lack of cross guarantees in the Dubai World group. For example, Ports & Free Zone World, which includes port operator DP World and P&O Ferries, is now clearly excluded from the process. But the initial lack of clarity on this issue has already cost Dubai Inc. a swathe of ratings downgrades. Of Moody’s six ratings on Dubai companies, four are now junk.

The history of debt restructurings suggests that investors will not be scared off Dubai forever. Russia, for example, returned as an oil-fuelled darling of international investors even after its sovereign default in 1998 and amid continuing corporate governance and transparency problems.

If Dubai handles the painful process sensibly, it will emerge chastened from the experience, but not necessarily a spent force. The infrastructure built during the bubble will not vanish. The emirate now has to prove its status as one of the most western-friendly places to do business in a region still attractive for its massive oil wealth. If it can do so, Dubai will be down, not out.

http://online.wsj.com/article/SB10001424052748704107104574569993758321068.html

Dylan Ratigan

Lately I have been using the phrase “Corporate Communism” on my television show. I think it is an especially fitting term when discussing the current landscape in both our banking and health care systems.

As Americans, I believe we reject communism because it historically has allowed a tiny group of people to consolidate complete control over national resources (including people), in the process stifling competition, freedom and choice. It leaves its citizens stagnating under the perpetual broken systems with no natural motivation to innovate, improve services or reduce costs.

Lack of choice, lazy, unresponsive customer service, a culture of exploitation and a small powerbase formed by cronyism and nepotism are the hallmarks of a communist system that steals from its citizenry and a major reason why America spent half a century fighting a Cold War with the U.S.S.R.

And yet today we find ourselves as a country in two distinctly different categories: those who are forced to compete tooth and nail each day to provide value to society in return for income for ourselves and our families and those who would instead use our lawmaking apparatus to help themselves to our tax money and/or to protect themselves from true competition.

If you allow weak, outdated players to take control of the government and change the rules so they are protected from the natural competition and reward systems that have created so many innovations in our country, you not only steal from the citizens on behalf of the least worthy but you also doom them by trapping the capital that would be used to generate new innovation and, most tangibly in our current situation, jobs.

We are losing the opportunity cost of all the great ideas that should be coming from the proper deployment of that 23.7 trillion in capital. Everything from innovation in medical delivery systems to accessible space travel, free energy to the driverless car; all of these things may never come to bear because those powerful individuals who have failed, been passed over by technological advancements, innovation and flat-out smarts, have commandeered our government to unfairly sustain their wealth and power.

Unfortunately, they use our wealth and laws not only to benefit their outdated, failed companies, but also spend a small pittance of their ill-gotten gains lobbying and favor-trading with politicians so the government will continue to protect them from competition and their well-deserved failure.

The massive spike in unemployment, the utter destruction of retirement wealth, the collapse in the value of our homes, the worst recession since the Great Depression have all resulted directly from the abdication of proper government.

Even with all that — the only changes that have been made, have been made to prop up and hide the massive flaws on behalf of those who perpetuated them. Still utterly nothing has been done to disclose the flaws in this system, improve it or rebuild it. Only true rules-based capitalism ensures constant adaptation and implementation of the latest and best practices for a given business, as those businesses that don’t adapt fail, and those who deploy the latest innovations to their customers benefit, prosper.

The concept of communism is rightly reviled in this country for the simple reason that it is blind to human nature, allowing a small group of individuals near-total control, while sticking everyone else with the same crappy systems — and the bill. America spent countless lives and half a century fighting against this system of government. So why are we standing for it now?

Follow Dylan Ratigan on Twitter: www.twitter.com/DylanRatigan
http://www.huffingtonpost.com/dylan-ratigan/the-cost-of-corporate-com_b_312516.html?view=print

By Alexander Bolton – 08/30/09 10:17 AM ET

The nation’s largest labor union and some allied Democrats are pushing a new tax that would hit big investment firms such as Goldman Sachs reaping billions of dollars in profits while the rest of the economy sputters.

The AFL-CIO, one of the Democratic Party’s most powerful allies, would like to assess a small tax — about a tenth of a percent — on every stock transaction.

Small and medium-sized investors would hardly notice such a tax, but major trading firms, such as Goldman, which reported $3.44 billion in profits during the second quarter of 2009, may see this as a significant threat to their profits.

 
“It would have two benefits, raise a lot of revenue and discourage speculative financial activity,” said Thea Lee, policy director at the AFL-CIO.

“The big disadvantage of most taxes is that they discourage some really productive activity,” she said. “This would discourage numerous financial transactions. People flip their assets several times in an hour or a day. They make money but does it really add to the productive base of the United States?”

Lee said that taxing every stock transaction a tenth of a percent could raise between $50 billion and $100 billion per year, which could be used to pay for infrastructure projects and other spending priorities. She said the tax could be applied nationwide or internationally.

The proposal would hit especially hard those hedge funds and large banks earning hefty profits despite the shaky economy from a practice known as high-frequency trading. High-frequency traders use powerful computers to conduct hundreds of thousands of orders in mere seconds, taking advantage of slower traders.

Only the biggest investment firms can afford to develop the technology, which delivers handsome profits at little risk. The growing popularity of the practice has contributed to the soaring volume of trades on Wall Street in recent years and, some critics argue, market volatility and rampant speculation.

High-frequency trading is estimated to earn about $20 billion in profits for the nation’s biggest investment firms, who guard the their practices zealously. Goldman Sachs, for example, has accused a former computer programmer of stealing the valuable code, launching a high-profile legal battle.

The AFL-CIO and some allied Democrats would like to cut down on the overall level of trading, or at least give the U.S. government a piece of the action, which would likely tamp down trading.

Democrats and labor officials would also like to take a bite out of Goldman’s profits. Liberals are angry the company, which immersed itself in the frenzy of speculation leading to last year’s financial collapse, is now making huge profits after accepting (and repaying) $10 billion in government aid. Goldman employees are on track to earn an average of more than $700,000 this year. 

There is also a growing realization among Obama administration officials and lawmakers that tax increases may be necessary to curb the ballooning federal deficit.

The idea of taxing financial transactions has gained some support on Capitol Hill and among senior government officials in London, a major foreign financial center.

In Congress, Rep. Peter DeFazio (D-Ore.), chairman of the Highways and Transit Transportation Subcommittee, has seized on the idea as a way to help pay for a new massive surface transportation reauthorization bill, estimated to cost $450 billion over six years.

Instead of taxing all stock transactions, as the AFL-CIO has contemplated, DeFazio wants to focus on oil-based derivatives.

At the end of July, shortly before the House broke for the August recess, DeFazio introduced legislation that would impose a 0.2 percent transaction tax on crude oil futures contracts. The legislation would tax the options for oil futures (in other words, the premium paid to have the option to buy a futures contract) at 0.5 percent.

“The tax is simple; it imposes a small burden that penalizes short-term traders for speculating on the price of oil,” DeFazio said in a statement. “This legislation exempts legitimate hedgers from the transaction tax. Since the tax is on speculation only, it deters speculation and undermines much of the crude oil price bubble.”

DeFazio estimates his proposal, which has been referred to the House Ways and Means Committee, would raise $190 billion over six years. It has 29 cosponsors.

An aide to a liberal Senate Democrat said a transaction tax seems like a good idea but did not know who might champion the cause in the upper chamber. An aide on the Senate Finance Committee was not aware of discussion of the proposal.

Taxing financial transactions has gained some momentum in Europe. Lord Adair Turner, chairman of the Financial Services Authority, Britain’s top banking regulator, voiced support for taxing financial transactions in a recent magazine interview. The French government has endorsed the idea as a way to fund development in poor countries.

The proposal to tax financial transactions is also known as a “Tobin tax,” after the late American economist and Nobel laureate James Tobin. Tobin proposed a transactions tax in the early 1970s to discourage currency speculation after the collapse of the Bretton Woods fixed-exchange-rate system.

Source:
http://thehill.com/homenews/house/56789-afl-cio-dems-push-new-wall-street-tax
The contents of this site are © 2009 Capitol Hill Publishing Corp., a subsisiary of News Communications, Inc.

Posted By admin On October 27, 2009 @ 9:30 am In Featured Stories
Paul Joseph Watson
Prison Planet.com
Tuesday, October 27, 2009

Congressman Ron Paul has questioned why, despite his efforts to encourage the general public to get vaccinated against the H1N1 virus, President Barack Obama has refused to allow his own daughters to take the swine flu shot.

Despite the fact that Obama on Friday declared a national emergency in response to the H1N1 outbreak, he apparently doesn’t deem it enough of a threat to have his two daughters vaccinated against the virus.

Such double standards have led media pundits to call for Obama to get his daughters vaccinated on live television, in an effort to encourage American parents to do the same for their kids. The swine flu vaccination program, which was initially intended to be a “mass” inoculation covering the entire population, has been rejected by a majority of Americans who harbor deep suspicions about dangerous additives contained in the vaccine such as mercury and squalene.

In a Campaign For Liberty video message, former Presidential candidate Ron Paul labeled the vaccination program a “failure,” and slammed Obama for failing to follow the same advice he gave to the nation.

“It’s interesting to note that the President’s children have not gotten their shots and the explanation for this is it hasn’t been available to them – now that’s a little bit hard to buy when you think that probably anything the President wants can be available for their children,” said Paul, adding, “So in a way he’s made his decision not to give his children these inoculations – so if he has freedom of choice on this, I would like to make sure that all the American people have the same amount of freedom of choice.”

Others have echoed similar sentiments. “Surely if there is a national emergency and if the President and First Lady of the United States wanted flu shots for their daughters, they could get them. It is certainly connected to our national security right? I mean the president needs to have his wits about him 24/7 not worrying over sick children. Could this instead be yet another case of “do as I say, not as I do” from the Obama administration?” writes Cathryn Friar.

Paul compared Obama’s hypocrisy to politicians who lobby for the virtues of public education yet in every instance educate their own children privately.

“The biggest champions of public education make sure their kids never get public education, they always get private education where there’s a lot better choices than the kind of system they’re promoting,” said the Congressman.

Obama certainly isn’t stupid enough to inject his own kids with the same toxic soup that he encourages the idiot public to receive, and will probably be keen on getting access to the special additive-free swine flu shots produced by Baxter International that have been made available for the elite.

As Spiegel Online reported earlier this month, German Chancellor Angela Merkel and government ministers received a mercury and squalene-free H1N1 vaccine. “The Vakzin [vaccine] does not contain disputed additives — contrary to the vaccine for the remainder of the population,” reported the newspaper. Soldiers in the German army were also given the adjuvant-free vaccine.

Employees of the Paul Ehrlich Institute in Germany also received the “green” inoculation after their president Johannes Löwer labeled the vaccine a greater threat than the virus itself. Löwer’s comment came after German lung specialist Wolfgang Wodarg said the vaccine increases the risk of cancer. The nutrient solution for the vaccine consists of cancerous cells from animals.

In the video update, Congressman Paul also warned that Obama’s emergency declaration on Friday was part of a plan to condition people to accept the notion of government as protector and coerce the public into complying with whatever they say, including forced quarantines.

Watch the Ron Paul clip below.

Article printed from Infowars: http://www.infowars.com

URL to article: http://www.infowars.com/ron-paul-questions-why-obama-daughters-havent-taken-swine-flu-vaccine/

The Financo-State

By Paul Craig Roberts

Evidence that the US is a failed state is piling up faster than I can record it.

One conclusive hallmark of a failed state is that the crooks are inside the government, using government to protect and to advance their private interests. 

Another conclusive hallmark is rising income inequality as the insiders manipulate economic policy for their enrichment at the expense of everyone else.

Income inequality in the US is now the most extreme of all countries.  The 2008 OECD report, “Income Distribution and Poverty in OECD Countries,” [PDF]concludes that the US is the country with the highest inequality and poverty rate across the OECD and that since 2000 nowhere has there been such a stark rise in income inequality as in the US.

  The OECD finds that in the US the distribution of wealth is even more unequal than the distribution of income.

On October 21, 2009, Business Week reported   that a new report from the United Nations Development Program concluded that the US ranked third among states with the worst income inequality.  As number one and number two, Hong Kong and Singapore, are both essentially city states, not countries, the US actually has the shame of being the country with the most inequality in the distribution of income.

The stark increase in US income inequality in the 21st century coincides with the offshoring of US jobs, which enriched executives with “performance bonuses” while impoverishing the middle class, and with the rapid rise of unregulated OTC derivatives, which enriched Wall Street and the financial sector at the expense of everyone else.

Millions of Americans have lost their homes and half of their retirement savings while being loaded up with government debt to bail out the banksters who created the derivative crisis.

Frontline’s October 21 broadcast, “The Warning,” documents how Federal Reserve Chairman Alan Greenspan, Treasury Secretary Robert Rubin, Deputy Treasury Secretary Larry Summers, and Securities and Exchange Commission Chairman Arthur Levitt blocked Brooksley Born, head of the Commodity Futures Trading Commission, from performing her statutory duties and regulating OTC derivatives. 

After the worst crisis in US financial history struck, just as Brooksley Born said it would, a disgraced Alan Greenspan was summoned out of retirement to explain to Congress his unequivocal assurances that no regulation of derivatives was necessary.  Greenspan had even told Congress that regulation of derivatives would be harmful.  A pathetic Greenspan had to admit that the free market ideology on which he had relied turned out to have a flaw.

Greenspan may have bet our country on his free market ideology, but does anyone believe that Rubin and Summers were doing anything other than protecting the enormous fraud-based profits that derivatives were bringing Wall Street?  As Brooksley Born stressed, OTC derivatives are a “dark market.” There is no transparency. Regulators have no information on them and neither do purchasers. 

Even after Long Term Capital Management blew up in 1998 and had to be bailed out, Greenspan, Rubin, and Summers stuck to their guns. Greenspan, Rubin and Summers, and a roped-in gullible Arthur Levitt who now regrets that he was the banksters’ dupe, succeeded in manipulating a totally ignorant Congress into blocking the CFTC from doing its mandated job. Brooksley Born, prevented by the public’s elected representatives from protecting the public, resigned.  Wall Street money simply shoved facts and honest regulators aside, guaranteeing government inaction and the financial crisis that hit in 2008 and continues to plague our economy today.

The financial insiders running the Treasury, White House, and Federal Reserve shifted to taxpayers the cost of the catastrophe that they had created.  When the crisis hit, Henry Paulson, appointed by President Bush as Rubin’s replacement as the Goldman Sachs representative running the US Treasury, hyped fear to obtain from “our” representatives in Congress with no questions asked hundreds of billions of taxpayers’ dollars (TARP money)  to bail out Goldman Sachs and the other malefactors of unregulated derivatives. 

When Goldman Sachs recently announced that it was paying massive six- and seven-figure bonuses to every employee, public outrage erupted.  In defense of banksters, saved with the public’s money, paying themselves bonuses in excess of most people’s life-time earnings, Lord Griffiths, Vice Chairman of Goldman Sachs International, said that the public must learn to “tolerate the inequality as a way to achieve greater prosperity for all.”[Public must learn to 'tolerate the inequality' of bonuses, says Goldman Sachs vice-chairman]

In other words, “Let them eat cake.”

According to the UN report cited above, Great Britain has the 7th most unequal income distribution in the world. After the Goldman Sachs bonuses, the British will move up in distinction, perhaps rivalling Israel for the fourth spot in the hierarchy.

Despite the total insanity of unregulated derivatives, the high level of public anger, and Greenspan’s confession to Congress, still nothing has been done to regulate derivatives. 

One of Rubin’s Assistant Treasury Secretaries, Gary Gensler, has replaced Brooksley Born as head of the CFTC.  Larry Summers is the head of President Obama’s National Economic Council.  Former Federal Reserve official Timothy Geithner, a Paulson protege, runs the Obama Treasury.  A Goldman Sachs vice president, Adam Storch, has been appointed the chief operating officer of the Securities and Exchange Commission.

The Banksters are still in charge.

Is there another country in which in full public view so few so blatantly use government for the enrichment of private interests, with a coterie of “free market” economists available to justify plunder on the grounds that “the market knows best”? 

A narco-state is bad enough.  The US surpasses this horror with its financo-state.

As Brooksley Born says, if nothing is done, “it’ll happen again.”

But nothing can be done.  The crooks have the government.

http://www.vdare.com/asp/printPage.asp?url=http://www.vdare.com/roberts/091025_next_crisis.htm