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xtruss · 1 year

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How Deep Is The Rot In America’s Banking Industry? Silicon Valley Bank May Be The Start Of Something Grimmer

— Finance & Economics | The Prop-up Job | March 16th 2023 | Washington, DC

Banking is a confidence trick. Financial history is littered with runs, for the straightforward reason that no bank can survive if enough depositors want to be repaid at the same time. The trick, therefore, is to ensure that customers never have cause to whisk away their cash. It is one that bosses at Silicon Valley Bank (svb), formerly America’s 16th-largest lender, failed to perform at a crucial moment.

The fall of svb, a 40-year-old bank set up to cater to the Bay Area tech scene, took less than 40 hours. On March 8th the lender said it would issue more than $2bn of equity capital, in part to cover bond losses. This prompted scrutiny of its balance-sheet, which revealed around half its assets were long-dated bonds, and many were underwater. In response, deposits worth $42bn were withdrawn, a quarter of the bank’s total. At noon on March 10th regulators declared that svb had failed.

It might have been a one-off. svb’s business—banking for techies—was unusual. Most clients were firms, holding in excess of the $250,000 protected by the Federal Deposit Insurance Corporation (fdic), a regulator. If the bank failed they faced losses. And svb used deposits to buy long-dated bonds at the peak of the market. “One might have supposed that Silicon Valley Bank would be a good candidate for failure without contagion,” says Larry Summers, a former treasury secretary. Nevertheless, withdrawal requests at other regional banks in the following days showed “there was in fact substantial contagion”.

Hence the authorities’ intervention. Before markets reopened on March 13th, the Federal Reserve and the Treasury Department revealed that Signature Bank, a lender based in New York, had also failed. They announced two measures to guard against more collapses. First, all depositors in svb and Signature would be made whole, and straightaway. Second, the Federal Reserve would create a new emergency-lending facility, the Bank Term Funding Programme. This would allow banks to deposit high-quality assets, like Treasuries or mortgage bonds backed by government agencies, in return for a cash advance worth the face value of the asset, rather than its market value. Banks that had loaded up on bonds which had fallen in price would thus be protected from svb’s fate.

These events raise profound questions about America’s banking system. Post-financial-crisis regulations were supposed to have stuffed banks with capital, pumped up their cash buffers and limited the risks they were able to take. The Fed was meant to have the tools it needed to ensure that solvent institutions remained in business. Critically, it is a lender of last resort, able to swap cash for good collateral at a penalty rate in its “discount window”. Acting as a lender of last resort is one of any central bank’s most important functions. As Walter Bagehot, a former editor of The Economist, wrote 150 years ago in “Lombard Street”, a central bank’s job is “to lend in a panic on every kind of current security, or every sort on which money is ordinarily and usually lent.” That “may not save the bank; but if it do not, nothing will save it.”

The Fed and Treasury’s interventions were the sort which would be expected in a crisis. They have fundamentally reshaped America’s financial architecture. Yet at first glance the problem appeared to be poor risk management at a single bank. “Either this was an indefensible overreaction, or there is much more rot in the American banking system than those of us on the outside of confidential supervisory information can even know,” says Peter Conti-Brown, a financial historian at the University of Pennsylvania. So which is it?

To assess the possibilities, it is important to understand how changes in interest rates affect financial institutions. A bank’s balance-sheet is the mirror image of its customers’. It owes depositors money. Loans people owe it are its assets. At the beginning of 2022, when rates were near zero, American banks held $24trn in assets. About $3.4trn of this was cash on hand to repay depositors. Some $6trn was in securities, mostly Treasuries or mortgage-backed bonds. A further $11.2trn was in loans. America’s banks funded these assets with a vast deposit base, worth $19trn, of which roughly half was insured by the fdic and half was not. To protect against losses on their assets, banks held $2trn of “tier-one equity”, of the highest quality.

Then interest rates leapt to 4.5%. svb’s fall has drawn attention to the fact that the value of banks’ portfolios has fallen as a result of the rise in rates, and that this hit has not been marked on balance-sheets. The fdic reports that, in total, America’s financial institutions have $620bn in unrealised mark-to-market losses. It is possible, as many have done, to compare these losses with the equity banks hold and to feel a sense of panic. In aggregate a 10% hit to bond portfolios would, if realised, wipe out more than a quarter of banks’ equity. The financial system might have been well-capitalised a year ago, so the argument goes, but a chunk of this capitalisation has been taken out by higher rates.

The exercise becomes more alarming still when other assets are adjusted for higher rates, as Erica Jiang of the University of Southern California and co-authors have done. There is, for instance, no real economic difference between a ten-year bond with a 2% coupon and a ten-year loan with a fixed 2% interest rate. If the value of the bond has fallen by 15% so has the value of the loan. Some assets will be floating-rate loans, where the rate rises with market rates. Helpfully, the data the researchers compiled divides loans into those with fixed and floating rates. This allows the authors to analyse only fixed-rate loans. The result? Bank assets would be worth $2trn less than reported—enough to wipe out all equity in the American banking system. Although some of this risk could be hedged, doing so is expensive and banks are unlikely to have done much of it.

But as Ms Jiang and co-authors point out, there is a problem with stopping the analysis here: the value of the counterbalancing deposit base has not also been re-evaluated. And it is much, much more valuable than it was a year ago. Financial institutions typically pay nothing at all on deposits. These are also pretty sticky, as depositors park money in checking accounts for years on end. Meanwhile, thanks to rising rates, the price of a ten-year zero-coupon bond has fallen by almost 20% since early 2022. This implies the value of being able to borrow at 0% for ten years, which is what a sticky, low-cost deposit base in effect provides, is worth 20% more now than it was last year—more than enough to offset losses on bank assets.

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The true risk to a bank therefore depends on both deposits and depositor behaviour. When rates go up customers may move their cash into money-market or high-yield savings accounts. This increases the cost of bank funding, although typically not by all that much. Sometimes—if a bank runs into severe difficulties—deposits can vanish overnight, as svb discovered in ruinous fashion. Banks with big, sticky, low-cost deposits do not need to worry much about the mark-to-market value of their assets. In contrast, banks with flighty deposits very much do. As Huw van Steenis of Oliver Wyman, a consultancy, notes: “Paper losses only become real losses when crystallised.”

How many banks have loaded up on securities, or made lots of fixed-rate loans, and are uncomfortably exposed to flighty deposits? Insured deposits are the stickiest because they are protected if things go wrong. So Ms Jiang and co-authors looked at uninsured cash. They found that if half of such deposits were to be withdrawn, the remaining assets and equity of 190 American banks would not be enough to cover the rest of their deposits. These banks currently hold $300bn in insured deposits.

The newfound ability to swap assets at face value, under the Bank Term Funding Programme, at least makes it easier for banks to pay out depositors. But even this is only a temporary solution. For the Fed’s new facility is something of a confidence trick itself. The programme will prop up struggling banks only so long as depositors think it will. Borrowing through the facility is done at market rates of around 4.5%. This means that if the interest income a bank earns on its assets is below that—and its low-cost deposits leave—the institution will simply die a slow death from quarterly net-interest income losses, rather than a quick one brought about by a bank run.

This is why Larry Fink, boss of BlackRock, a big asset-management firm, has warned of a “slow-rolling crisis”. He expects this to involve “more seizures and shutdowns”. That high interest rates have exposed the kind of asset-liability mismatch that felled svb is, he reckons, a “price we’re paying for decades of easy money”. Mr Conti-Brown of UPenn points out that there are historical parallels, the most obvious being the bank casualties that mounted in the 1980s as Paul Volcker, the Fed’s chairman at the time, raised rates.

Higher rates have exposed problems in bond portfolios first, as markets show in real-time how these assets fall in value when rates rise. But bonds are not the only assets that carry risk when policy changes. “The difference between interest-rate risk and credit risk can be quite subtle,” notes Mr Conti-Brown, as rising rates will eventually put pressure on borrowers, too. In the 1980s the first banks to fail were those where asset values fell with rising rates—but the crisis also exposed bad assets within America’s “thrifts”, specialist consumer banks, in the end. Thus pessimists worry banks now failing because of higher rates are just the first domino to collapse.

The result of all this is that the banking system is far more fragile than it was perceived to be—by regulators, investors and probably bankers themselves—before the past week. It is clear that smaller banks with uninsured deposits will need to raise more capital soon. Torsten Slok of Apollo, a private-equity firm, points out that a third of assets in America’s banking system are held by banks smaller than svb. All of these will now tighten up lending to try to strengthen their balance-sheets.

That medium-sized banks can be too big to fail is one lesson regulators should learn from svb. The episode has upended other parables of post-crisis finance as well. “After 2008 investors thought deposits were safe, and market funding was risky. They also thought Treasuries were safe and loans were risky,” says Angel Ubide of Citadel, a hedge fund. “All of the post-crisis rule books were written on that basis. Now the reverse looks to be the case.” One parable remains intact, however. Problems in the financial system never emerge from the most closely watched places. ■

— This article appeared in the Finance & economics section of the print edition under the headline "The prop-up job"

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swldx · 1 year

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Voice of America 0330 20 Jan 2023

6080Khz 0258 20 JAN 2023 - VOICE OF AMERICA (UNITED STATES OF AMERICA) in ENGLISH from PINHEIRA. SINPO = 45333. English, @0258z dead carrier s/on. @0300z “News via remote” read by Marissa Melton. Hours after Ukraine appealed to its Western allies to send tanks to help its forces defeat Russia, the United States on Thursday announced more than $2.5 billion in military aid; but no tanks. Ukrainian Foreign Minister Dmytro Kuleba and Defense Minister Oleksii Reznikov welcomed Britain's move to send its Challenger 2 tanks to Ukraine, while urging countries that have German-made Leopard 2 tanks to also send them to Ukraine. President Joe Biden said Thursday there is "no there there" when he was questioned about the discovery of classified documents and official records at his home and former office. "We found a handful of documents were filed in the wrong place," Biden said to reporters who questioned him during a tour of the damage from storms in California. "We immediately turned them over to the Archives and the Justice Department." Biden said he was "fully cooperating and looking forward to getting this resolved quickly." Families of Americans wrongfully detained in China are calling on U.S. Secretary of State Antony Blinken to bring up American detainee cases during his meetings with top Chinese leaders in Beijing next month. Federal Reserve Chair Jerome Powell has tested positive for COVID-19, the central bank announced Wednesday. Powell, 69, "is experiencing mild symptoms," the Fed said in a statement. "Following Centers for Disease Control and Prevention guidance, he is working remotely while isolating at home." The Fed noted that Powell was up to date with vaccines and boosters. A major Indian journalist group urged the government to reject a proposal to police fake news on social media, saying such a change to the country's information-technology rules would be akin to censorship. The proposal would bar social media platforms from hosting any information that the authorities identify as false, the latest in a slew of measures by Prime Minister Narendra Modi's government that are being seen as efforts to rein in big tech firms. Preliminary reports from an on-going investigation into a deadly landslide in Malaysia that killed 31 people at a farm and campsite seem to indicate the area was not zoned for agricultural, commercial or recreational use. Dozens of people were buried as they slept in their tents at Father’s Organic Farm in Batang Kali, a popular recreation area about 50 kilometers north of the country’s largest city, Kuala Lumpur, when a landslide swept over the campsite in the early morning hours of December 16. The tragedy shook the country and has led to renewed calls for increased safety and accountability. Greta Thunberg called on the global energy industry and its financiers to end all fossil fuel investments on Thursday at a high-profile meeting in Davos with the head of the International Energy Agency (IEA). During a round-table discussion with Fatih Birol on the sidelines of the World Economic Forum (WEF) annual meeting, activists said they had presented a "cease and desist" letter to CEOs calling for a stop to new oil, gas and coal extraction. "As long as they can get away with it, they will continue to invest in fossil fuels, they will continue to throw people under the bus," Thunberg warned. David Crosby, one of the most influential rock singers of the 1960s and '70s with the Byrds and Crosby, Stills, Nash & Young, has died at age 81, Variety reported Thursday, citing a statement from Crosby's wife. @0305z "Daybreak Africa" begins. MLA 30 amplified loop (powered w/8 AA rechargeable batteries ~10.8vdc), Etón e1XM. 100kW, beamAz 138°, bearing 82°. Received at Plymouth, United States, 10777KM from transmitter at Pinheira. Local time: 2143.

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irvinenewshq · 2 years

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U.S. GDP is expected to return to growth after 6 months of shrinkage

The problems have hardly gone away. Inflation, still near a 40-year high, is punishing households. Rising interest rates have derailed the housing market and threaten to inflict broader damage. And the outlook for the world economy grows bleaker the longer that Russia’s war against Ukraine drags on. But for now anyway, the U.S. economy has likely returned to growth after having shrunk in each of the first two quarters of 2022. At least that’s what economists expect to see Thursday when the Commerce Department issues its first of three estimates of gross domestic product — the broadest measure of economic output — for the July-September period. Economists surveyed by the data firm FactSet have predicted, on average, that GDP grew at a 2% annual rate in the third quarter. That would reverse annual declines of 1.6% from January through March and 0.6% from April through June. Consecutive quarters of declining economic output are one informal definition of a recession. But most economists say they believe the economy has so far skirted a recession, noting the still-resilient job market and steady spending by consumers. Most of them have expressed concern, though, that a recession is likely next year as the Federal Reserve continues to steadily ratchet up interest rates to fight inflation. Preston Caldwell, head of U.S. economics for the financial services firm Morningstar, notes that the economy’s contraction in the first half of the year was caused largely by factors that don’t reflect its underlying health and so “very likely did not constitute a genuine economic slowdown.” He pointed, for example, to a drop in business inventories, a cyclical event that tends to reverse itself and generally doesn’t reflect the state of the economy. By contrast, consumer spending, fueled by a healthy job market, and stronger U.S. exports likely restored the world’s biggest economy to growth last quarter. Thursday’s report from the government comes as Americans, worried about high prices and recession risks, are preparing to vote in midterm elections that will determine whether President Joe Biden’s Democratic Party retains control of Congress. Inflation has become a signature issue for Republican attacks on the Democrats’ stewardship of the economy. The risk of an economic downturn next year remains elevated as the Fed keeps raising rates aggressively to try to tame stubbornly high consumer prices. The central bank has raised its benchmark short-term rate five times this year, and it’s expected to announce further hikes next week and again in December. Chair Jerome Powell has warned bluntly that taming inflation will “bring some pain’’ — namely, higher unemployment and, possibly, a recession. Higher borrowing costs have already hammered the home market. The average rate on a 30-year fixed-rate mortgage, just 3.09% a year ago, is approaching 7%. Sales of existing homes have fallen for eight straight months. Construction of new homes is down nearly 8% from a year ago. Still, the economy retains pockets of strength. One is the vitally important job market. Employers have added an average of 420,000 jobs a month this year, putting 2022 on track to be the second-best year for job creation (behind 2021) in Labor Department records going back to 1940. The unemployment rate was 3.5% last month, matching a half-century low. But hiring has been decelerating. In September, the economy added 263,000 jobs — solid but the lowest total since April 2021. International events are causing further concerns. Russia’s invasion of Ukraine has disrupted trade and raised prices of energy and food, creating a crisis for poor countries. The International Monetary Fund, citing the war, this month downgraded its outlook for the world economy in 2023. Sign up for the Fortune Features email list so you don’t miss our biggest features, exclusive interviews, and investigations. Originally published at Irvine News HQ

#Irvine News HQ

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bitcofun · 2 years

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The Federal Reserve has increased interest rates by another 0.75%, and the crypto market has rallied in response. Key Takeaways The Federal Reserve has hiked interest rates by another 75 basis points. The rate hike comes after the Consumer Price Index revealed that inflation had hit a fresh 40-year high of 9.1% in June. The Fed’s repeated rate hikes are prompting concerns that the country may be heading into a recession. U.S. interest rates have returned to pre-pandemic levels as the Federal Reserve attempts to tackle soaring inflation rates. Fed Fights Inflation With 0.75% Rate HikeThe Federal Reserve has hiked interest rates by another 75 basis points. The U.S. central bank announced the development at Wednesday’s Federal Open Market Committee. After the 0.75% increase, U.S. interest rates are now between 2.25% and 2.5%, the highest levels seen since the beginning of the COVID-19 pandemic. The Fed’s decision came after the U.S. Bureau of Labor Statistics revealed that the Consumer Price Index had risen to a 40-year high of 9.1% in June despite the central bank’s months-long efforts to curb soaring prices with interest rate hikes. The bureau’s report said that gasoline, shelter, and food price rises were the biggest contributor to the rise. The latest move from the Fed comes as growing numbers of Americans express fears over soaring prices. According to a recent CNBC poll, 96% of citizens are “concerned” about the food, gas, and shelter price rises. To fight inflation, the Fed can attempt to contract the money supply. It does so by raising interest rates, which makes borrowing money more costly. The 75 basis point hike was widely expected, though it was speculated that the central bank could opt for a 100 basis points hike shortly after the inflation data for June dropped.“Inflation has obviously surprised to the upside over the past year and further surprises could be in store,” said Federal Reserve Chair Jerome Powell at the press conference that following the FOMC meeting. While he stated that it would “become appropriate to slow the pace of increases,” he added that the central bank would consider “an even larger” hike if needed in the future.Recession Fears LoomThe Fed’s efforts to curb inflation come as uncertainty prevails across global markets and fears of a possible recession escalate. The Bureau of Economic Analysis’ GDP print showed the U.S. economy shrank by 1.6% in the first financial quarter, and many economists fear that the economy could post a decline in the second quarter. A recession has historically been identified by two consecutive quarterly declines in GDP.The GDP numbers for the second quarter of the year will be released tomorrow, and the White House has seemingly been preparing the public for the announcement in advance. Last week, it published a blog post on the matter, before sharing an interview transcript in which Treasury Secretary Janet Yellen argued that two consecutive quarters would not indicate that the country was in a recession because the Bureau of Economic Analysis looks at “a broad range of data.” President Biden said on Monday that the U.S. was “not going to be in a recession” in response to a reporter’s question about tomorrow’s GDP print, and yesterday his economic advisor Brian Deese reiterated Yellen’s argument in the White House’s press office.The crypto market has reacted positively to today’s hike, with both Bitcoin and Ethereum jumping following the Fed’s announcement. Bitcoin crossed $22,000, and is up 5% in the past 24 hours. Ethereum hit around $1,550, jumping 11.6% on the day. After the latest rally, the global cryptocurrency market capitalization has once again topped $1 trillion.Disclosure: At the time of writing, the author of this piece owned ETH and several other cryptocurrencies. The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation

or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information. You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities. See full terms and conditions. Fed Chair Powell Warns of 50 Basis-Point Hike, Recession Risks News Apr. 21, 2022 Chair Jerome Powell has said that the Federal Reserve might do well to raise interest rates more quickly than it has recently. He still maintained the Fed’s view that the... U.S. Inflation Hits 40-Year High of 9.1% News Jul. 13, 2022 As a result of the continually rising U.S. inflation, markets are already betting on another 75 basis points hike from the Federal Reserve later this month. June CPI Hits Four-Decade... Fed Raises Rates by 75 Basis Points News Jun. 15, 2022 The U.S. central bank announced today it will be raising interest rates by another 0.75% in an effort to combat raging inflation. The Largest Hike Since 1994 The Federal Reserve... Read More

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joeyclaire · 3 years

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Who is he.

Ben Bernanke

14th Chair of Federal Reserve

Ben Shalom Bernanke (/bərˈnæŋki/ bər-NANG-kee; born December 13, 1953) is an American economist at the Brookings Institution who served two terms as the 14th Chair of the Federal Reserve, from 2006 to 2014. During his tenure as chair, Bernanke oversaw the Federal Reserve's response to the late-2000s financial crisis, for which he was named the 2009 Time Person of the Year. Before becoming Federal Reserve chair, Bernanke was a tenured professor at Princeton University and chaired the department of economics there from 1996 to September 2002, when he went on public service leave.

Quick Facts 14th Chair of the Federal Reserve, President ...

From August 5, 2002, until June 21, 2005, he was a member of the Board of Governors of the Federal Reserve System, proposed the Bernanke Doctrine, and first discussed "the Great Moderation" — the theory that traditional business cycles have declined in volatility in recent decades through structural changes that have occurred in the international economy, particularly increases in the economic stability of developing nations, diminishing the influence of macroeconomic (monetary and fiscal) policy.

Bernanke then served as chairman of President George W. Bush's Council of Economic Advisers before President Bush nominated him to succeed Alan Greenspan as chairman of the United States Federal Reserve. His first term began February 1, 2006. Bernanke was confirmed for a second term as chairman on January 28, 2010, after being renominated by President Barack Obama, who later referred to him as "the epitome of calm." His second term ended January 31, 2014, when he was succeeded by Janet Yellen on February 3, 2014.

Bernanke wrote about his time as chairman of the Federal Reserve in his 2015 book, The Courage to Act, in which he revealed that the world's economy came close to collapse in 2007 and 2008. Bernanke asserts that it was only the novel efforts of the Fed (cooperating with other agencies and agencies of foreign governments) that prevented an economic catastrophe greater than the Great Depression.

Family and childhood

Bernanke was born in Augusta, Georgia, and was raised on East Jefferson Street in Dillon, South Carolina. His father Philip was a pharmacist and part-time theater manager. His mother Edna was an elementary school teacher. Bernanke has two younger siblings. His brother, Seth, is a lawyer in Charlotte, North Carolina. His sister, Sharon, is a longtime administrator at Berklee College of Music in Boston.

The Bernankes were one of the few Jewish families in Dillon and attended Ohav Shalom, a local synagogue; Bernanke learned Hebrew as a child from his maternal grandfather, Harold Friedman, a professional hazzan (service leader), shochet, and Hebrew teacher. Bernanke's father and uncle owned and managed a drugstore they purchased from Bernanke's paternal grandfather, Jonas Bernanke.

Jonas Bernanke was born in Boryslav, Austria-Hungary (today part of Ukraine), on January 23, 1891. He immigrated to the United States from Przemyśl, Poland, and arrived at Ellis Island, aged 30, on June 30, 1921, with his wife Pauline, aged 25. On the ship's manifest, Jonas's occupation is listed as "clerk" and Pauline's as "doctor med".

The family moved to Dillon from New York in the 1940s. Bernanke's mother gave up her job as a schoolteacher when her son was born and worked at the family drugstore. Ben Bernanke also worked there sometimes.

Young adult

As a teenager, Bernanke worked construction on a hospital and waited tables at a restaurant at nearby South of the Border, a roadside attraction, amusement park and fireworks retailer, in his hometown of Dillon, before leaving for college. To support himself throughout college, he continued to work during the summers at South of the Border.

Religion

As a teenager in the 1960s, Bernanke would help roll the Torah scrolls in his local synagogue. Although he keeps his beliefs private, his friend Mark Gertler, chairman of New York University's economics department, says they are "embedded in who he (Bernanke) is." Once Bernanke was at Harvard for his freshman year, Fellow Dillon native Kenneth Manning took him to Brookline for Rosh Hashanah services.

Education

Bernanke was educated at East Elementary, J.V. Martin Junior High, and Dillon High School, where he was class valedictorian and played saxophone in the marching band. Since Dillon High School did not offer calculus at the time, Bernanke taught it to himself. Bernanke scored 1590 out of 1600 on the SAT and was a National Merit Scholar. He also was a contestant in the 1965 National Spelling Bee.

Bernanke attended Harvard College in 1971, where he lived in Winthrop House, as did the future CEO of Goldman Sachs, Lloyd Blankfein, and graduated Phi Beta Kappa with an A.B. degree, and later with an A.M. in economics summa cum laude in 1975. He received a Ph.D. degree in economics from the Massachusetts Institute of Technology in 1979 after completing and defending his dissertation, Long-Term Commitments, Dynamic Optimization, and the Business Cycle. Bernanke's thesis adviser was the future governor of the Bank of Israel, Stanley Fischer, and his readers included Irwin S. Bernstein, Rüdiger Dornbusch, Robert Solow, and Peter Diamond of MIT and Dale Jorgenson of Harvard.

Personal life

Ben and Anna Bernanke

Bernanke met his wife, Anna, a schoolteacher, on a blind date. She was a student at Wellesley College, and he was in graduate school at MIT.[citation needed] The Bernankes have two children, Joel and Alyssa. He is an ardent fan of the Washington Nationals baseball team, and frequently attends games at Nationals Park.

When Bernanke left Stanford to accept a position at Princeton, he and his family moved to Montgomery Township, New Jersey, in 1985, where Bernanke's children attended the local public schools. Bernanke served for six years as a member of the board of education of the Montgomery Township School District.

In 2009, The Wall Street Journal reported that Bernanke was a victim of identity theft, a spreading crime the Federal Reserve has for years issued warnings about.

Academic and government career (1979–2006)

Bernanke meeting with United States President Barack Obama.

Bernanke taught at the Stanford Graduate School of Business from 1979 until 1985, was a visiting professor at New York University and went on to become a tenured professor at Princeton University in the Department of Economics. He chaired that department from 1996 until September 2002, when he went on public service leave. He resigned his position at Princeton July 1, 2005.

Bernanke served as a member of the Board of Governors of the Federal Reserve System from 2002 to 2005. In one of his first speeches as a Governor, entitled "Deflation: Making Sure It Doesn't Happen Here", he outlined what has been referred to as the Bernanke Doctrine.

As a member of the board of governors of the Federal Reserve System on February 20, 2004, Bernanke gave a speech in which he postulated that we are in a new era called the Great Moderation, where modern macroeconomic policy has decreased the volatility of the business cycle to the point that it should no longer be a central issue in economics.

In June 2005, Bernanke was named chairman of President George W. Bush's Council of Economic Advisers, and resigned as Fed Governor. The appointment was largely viewed as a test run to ascertain if Bernanke could be Bush's pick to succeed Greenspan as Fed chairman the next year. He held the post until January 2006.

Chairman of the United States Federal Reserve

Bernanke testifying before the House Financial Services Committee responding to a question on February 10, 2009.

On February 1, 2006, Bernanke began a fourteen-year term as a member of the Federal Reserve Board of Governors and a four-year term as chairman (after having been nominated by President Bush in late 2005). By virtue of the chairmanship, he sat on the Financial Stability Oversight Board that oversees the Troubled Asset Relief Program. He also served as chairman of the Federal Open Market Committee, the System's principal monetary policy making body.

His first months as chairman of the Federal Reserve System were marked by difficulties communicating with the media. An advocate of more transparent Fed policy and clearer statements than Greenspan had made, he had to back away from his initial idea of stating clearer inflation goals as such statements tended to affect the stock market. Maria Bartiromo disclosed on CNBC comments from their private conversation at the White House Correspondents' Association Dinner. She reported that Bernanke said investors had misinterpreted his comments as indicating that he was "dovish" on inflation. He was sharply criticized for making public statements about Fed direction, which he said was a "lapse in judgment."

Financial crisis of 2007–2008

Bernanke (left) in September 2008 as President Bush speaks about the economy

Further information: Financial crisis of 2007–08

As the Great Recession deepened, Bernanke oversaw some unorthodox measures. Under his guidance, the Fed lowered its funds interest rate from 5.25% to 0.0% within less than a year. When this was considered insufficient to abate the liquidity crisis, the Fed initiated quantitative easing, creating $1.3 trillion from November 2008 to June 2010 and using the created money to buy financial assets from banks and from the government.

Second term

Bernanke answers questions in 2013 at FOMC press conference

On August 25, 2009, President Obama announced he would nominate Bernanke to a second term as chairman of the Federal Reserve. In a short statement on Martha's Vineyard, with Bernanke standing at his side, Obama said Bernanke's background, temperament, courage and creativity helped to prevent another Great Depression in 2008.

#asks #ember360 #long post

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tinyshe · 3 years

Video

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Story at-a-glance

Behind the scenes of many of the companies that provide the products and services you use each day are two investment firms that own more shares than other shareholders. The list includes social media, transportation, news media, food manufacturers and pharmaceutical companies

Blackrock and Vanguard hold large interests in pivotal companies, and Vanguard holds a large share of Blackrock. In turn, Blackrock has been called the "Fourth Branch of Government" by Bloomberg as they are the only private firm that has financial agreements to lend money to the central banking system

Blackrock also developed the software used by the Fed to manage financial transactions; one Princeton University lecturer has said Blackrock controls the Federal Reserve and has more power than most governments

Ascertaining who owns large portions of Vanguard is more difficult as it is a private company that is not publicly traded. It's important to think globally but act locally to protect your civil rights, including supporting state legislators who support your right to choose health care

Until recently, it has appeared that economic competition has been driving the rise and fall of small and large companies across the U.S. Supposedly, PepsiCo is Coca Cola's competitor, Apple and android are vying for your loyalty and Pfizer and Bayer are battling for your pharmaceutical dollars. But what is revealed in this video, using publicly available data you can check, is that this has been an illusion.

On the surface, all appears to be the same as it always has been. But the growth of a few corporations, beginning in the mid-1970s, has all but destroyed the competitive market on which America's strength has rested. As demonstrated in the video, a quick look through Yahoo! Finance shows that Vanguard and Blackrock have been the puppet masters behind nearly every large industry that affects your life.

As you can quickly discern, the global economy may be the greatest illusionary trick ever pulled over the eyes of people around the world. Without doubt, we are in a new place and facing new challenges. It will take accurate information and local action to continue to have the right to take control of your health.

Behind the Scenes, Two Companies Own the Supply Chain

As you watch the video, you'll see that most of the large corporations that supply the food, information, data and drugs used every day are controlled by a select few investment firms whose sole goal is a greater return on their profits. Of course, that's been the backbone of a competitive economy — to grow your profit margin while competing against other companies for the same market.

In theory, this competition drives innovation, advancement and price structures that benefit the consumer. However, when one, two or three large companies own most of what you use, competition becomes an illusion, resulting in a monopoly where companies can set a price and there are no other products from which to choose.

As the World Economic Forum1 and United Nations2 collaborate to "build back better," it is crucial to pay attention to how large corporations across the world may contribute to a societal shift that moves more money into the hands of billionaires and creates a new depth of poverty across the world.

One of the mandates for the Federal Trade Commission is to ensure there is competition in the marketplace. For example, in 2000, a federal judge ruled that Microsoft had maintained a monopoly with Windows and tied the company browser, Internet Explorer, to the operating system, thus gaining a greater economic foothold.3

The company barely escaped being split up, until it agreed with a settlement to curb its practices. More than 20 years later, the Department of Justice is now looking at antitrust allegations against Google's business dealings that have hurt smaller competitors.4 But the two major investors in both these companies appear to have escaped unscathed.

As you go through the list of companies in which Vanguard and Blackrock strategically hold a large investment interest, consider how the products and services provided by these companies are inextricably intertwined with your daily life.

Google

YouTube

Facebook

Twitter

Instagram

Amazon

Alibaba

Pfizer

Bayer Pharmaceuticals

AstraZeneca

PepsiCo

Coca Cola

Microsoft

Apple

Netflix

Reuters

Viacom (CBS)

ATT

Tesla

The New York Times

Agricultural Bank of China

FedEx

American Airlines

United Airlines

TUI AG

Zimmer Biomet Holdings

Volkswagen AG

Ford Motor Company

You may recognize many of these names and some may not be as recognizable. You can do your own search on Yahoo! Finance,5 typing in the company and clicking "holdings" in the navigation bar. The companies span a variety of aspects of daily life, including:

Social media

Shopping

Food manufacturers

Technology and software

Pharmaceutical companies

Entertainment

Communications

Airlines

Medical equipment

Transportation

Holiday companies

Car companies

World media

However, as comments on my Twitter feed indicate, it is not always apparent why this information is important to your rights as an individual.6 It may be difficult to imagine a world where your news is being manipulated. As is illuminated in the video, Vanguard and Blackrock:7

"... own the news that's been created, they own the distribution of the news that's been created, they own the lives of the reporters that are reporting the news that's being distributed that's being created on your TV screen. CBS, FOX, ABC, it doesn't matter which you're watching.

They all are using that wonderful phrase from Davos now — build back better. The point being is that you've got very few people controlling everything and that's information. Talk about information is power, well not only do they create the information, but they have all the distribution nodes to literally change the world mindset as it were."

Every Media Chain Using the Same Narrative

Davos is a ski town in the Swiss Alps but has become the shorthand for the World Economic Forum Annual Meeting that's held in the town.8 It is a chance for some of the most powerful figures in the world to collaborate. The meeting has been headed and organized by Klaus Schwab, an 83-year-old German engineer and economist. As you consider what you're hearing in the news, remember:9

"Everything we see on the shelves in the shops, what you buy online, who delivers it, who is making the COVID jab, who is distributing the jab, who is reporting on the jab, who is censoring alternative information about the jab, and all the rest of it. It's all the same people."

The consistency of news reporting across mainstream media should now make sense since each of them have similar major investors and those major investors have a singular focus of raising their profit margin while pushing the Fourth Industrial Revolution. How can you believe what's being told in the news when every news channel is saying the same thing?

It may have been that Bob Woodward and Carl Bernstein, who broke the Nixon Watergate story in 1972, were the last investigative journalists working for a major news media company who were allowed to follow a news story to conclusion without blatant censorship.

Around the world, doctors are being silenced. At the beginning of the pandemic, medical professionals were told not to speak to the media about a lack of personal protective equipment within the hospital. Although the American Medical Association10 initially came out in support of a physician's right to speak out about the care conditions, the tables have since turned.

In the quick, six-minute video below, Dr. Dan Stock from McCordsville, Indiana, a suburb of Indianapolis, speaks to the board of the Mount Vernon Community School Corporation. He provides the board with documentation to back up his claim that the way in which the community was addressing an attempt to stop the spread of infection was, in fact, ineffective.

The video went viral11 with several million views within a day of its posting on YouTube, before it was taken down for “violating YouTube’s community guidelines.” August 11, 2011, Tucker Carlson featured the video and Stock on his Fox show,12 where Stock said, “It seems to me that focusing on immune system improvement whether through a vaccine or non-vaccine methods is the more rational approach to this.”

Yet, even though Stock provides research evidence and speaks knowledgeably about the transmission of viral illnesses, the rest of mainstream media have not picked up on the story and this information is not being communicated to the public. Those in power want to ensure this type of information is not shared because it's contrary to the narrative they are promoting.

House for Sale? Blackrock Is Interested

A recent expose in The Wall Street Journal warns, "… yield-chasing investors are snapping up single-family houses to rent out or flip. They are competing for houses with ordinary Americans, who are armed with the cheapest mortgage financing ever, and driving up home prices."13

Yet, why would institutional investors be interested in overpaying for single family homes? To gain a greater understanding of the answer, you must take a look at Blackrock's partners, which include the World Economic Forum. The company manages assets that are worth $5.7 trillion and appears to be focused on pushing the average American out of the housing market.

If most of the available housing is owned by investment groups and corporations, they become your landlord. This is one of the ways in which the World Economic Forum envisions society in 2030. It's the part where you will "own nothing and be happy."

While it sounds like it came straight from George Orwell's book, "1984," it is in fact the agenda published on the World Economic Forum website.14 In fact, Forbes15 published an article in 2016 titled "Welcome To 2030: I Own Nothing, Have No Privacy And Life Has Never Been Better," which was written by the World Economic Forum.

Interestingly, the World Economic Forum once had a link to the article on their website under "agenda," but that link is now dead,16 even though a WEF Twitter post17 touting it in 2017 is still up. The link on the Twitter post, however, is also dead. And, curiously, in February 2021, Reuters did a "fact check" which claims the WEF never had anything to do with it.

The Fourth Branch of Government

BlackRock not only is an investment firm, but also has been called the "Fourth Branch of Government" because they are the only private firm with an intimate relationship with the Federal Reserve and financial agreements to lend money to the central banking systems. Interestingly, software developed by BlackRock — Aladdin — is used by the Fed to manage their financial transactions.18

In comparison to other large financial investment firms who have political ties to one party or the other, Blackrock "possesses a power that's more technocratic."19 The firm has a global influence as well. They were tapped as an adviser to the Bank of Canada and the European Union hired them to advise them on incorporating governing and social practices.

According to an analysis by Bloomberg,20 the company may be paid as much as $48 million a year in fees, which could cement the company's ties with powerful policymakers.

To put this into perspective, BlackRock, an investment firm, has more power than most governments and controls the Federal Reserve, Wall Street mega-banks like Goldman Sachs and the WEF's Great Reset, according to F. William Engdahl, a strategic risk consultant and lecturer who holds a degree in politics from Princeton University.21 They don't just want your house, they want your life.

But Who Owns Vanguard?

When you take a look at who owns the largest portion of BlackRock, you learn its Vanguard.22 But ascertaining who has the greatest investment in Vanguard is a little more difficult. The company has a corporate structure that makes ownership challenging to discern.

It appears it's owned by a variety of funds, which in turn are owned by shareholders. Aside from these shareholders, the company has no outside investors and is not publicly traded. As reported in the featured video:23

"The elite who own Vanguard apparently do not like being in the spotlight, but of course they cannot hide from who is willing to dig. Reports from Oxfam and Bloomberg say that 1% of the world, together owns more money than the other 99%. Even worse, Oxfam says that 82% of all earned money in 2017 went to this 1%.

In other words, these two investment companies, Vanguard and BlackRock, hold a monopoly in all industries in the world and they, in turn, are owned by the richest families in the world, some of whom are royalty and who have been very rich since before the Industrial Revolution."

Although getting to the bottom of the major investors in Vanguard is difficult, it's important to keep in mind that BlackRock and Vanguard, individually and combined, own enough shares in Big Pharma and mainstream media to have control over what is produced, shared and distributed.

This information is important because it is the drug companies and media that are driving the response to this infection. Thus far, it has all endangered rather than optimized public health and the official narrative continues to be false, leading the public further astray and fostering fear based on lies.

To have a chance of righting this situation, we must understand the central players and why these false narratives are being created in the first place. In the Global Justice Now December 2020 report entitled "The Horrible History of Big Pharma,"24 they review the shameful history of the top seven drug companies in the world.

These companies are now developing and manufacturing drugs and gene-based "vaccines" against COVID-19, while mainstream media have helped suppress information about readily available older drugs that have been shown to have a high degree of efficacy against the infection.

Think Globally and Act Locally

Just as the market collectively impacted the downfall of the Grocery Manufacturers Association,25 you have an impact in your local community. It may be overwhelming to consider how quickly the world is changing, but you can have a voice in your local community.

As you may know, after my articles have been published for 48 hours, they are no longer available to read. This means, to reference the information you need to protect your health, you must copy and paste the articles and keep them on your hard drive. I encourage you to share these with your friends and family and encourage them to share as well.

It may be inconceivable to think about making a difference on a national scale to protect your civil rights, but there are approaches you can take on a local level that will make a big difference as people across the world speak up.

Many large communities and states are forming groups to stand up for individual rights, to prevent vaccine passports and limit governmental power in a peaceful manner.26 It's also important to find a group with which to work and to support your state legislators who support your right as an individual to choose your health care.

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newstfionline · 3 years

Text

Tuesday, April 6, 2021

Biden Effort to Combat Hunger Marks ‘a Profound Change’ (NYT) With more than one in 10 households reporting that they lack enough to eat, the Biden administration is accelerating a vast campaign of hunger relief that will temporarily increase assistance by tens of billions of dollars and set the stage for what officials envision as lasting expansions of aid. The effort to rush more food assistance to more people is notable both for the scale of its ambition and the variety of its legislative and administrative actions. The campaign has increased food stamps by more than $1 billion a month, provided needy children a dollar a day for snacks, expanded a produce allowance for pregnant women and children, and authorized the largest children’s summer feeding program in history. “We haven’t seen an expansion of food assistance of this magnitude since the founding of the modern food stamp program in 1977,” said James P. Ziliak, an economist at the University of Kentucky who studies nutrition programs. “It’s a profound change.”

Police, communities across U.S. fight back against anti-Asian hate crimes (Reuters) More than a dozen San Jose, California, police officers walked through the white arches of the Grand Century Mall in “Little Saigon” to reassure a Vietnamese-American community fearful over the rise in anti-Asian hate crimes in the United States. Across the United States, law enforcement agencies are scrambling to better protect Asian communities amid a wave of violence targeting them since lockdowns to cope with the coronavirus pandemic began about a year ago. A recent report by the Center for the Study of Hate and Extremism at California State University, San Bernardino, showed that while hate crimes overall in the United States had fallen slightly in 2020, crimes against Asian Americans and Pacific Islanders (AAPI) had jumped by 145%. A vicious assault last week in which a man kicked a 65-year-old immigrant from the Philippines in New York City multiple times was captured on video and went viral, further stoking fears about anti-Asian hate crimes. New York City has deployed a team of undercover Asian police officers. Other major cities, from San Jose to Chicago, have boosted patrols in Asian neighborhoods and sought to forge closer ties with communities, some of which have sought to fill gaps the police can’t fill.

Florida works to avoid ‘catastrophic’ pond collapse (AP) Florida Gov. Ron DeSantis said Sunday that crews are working to prevent the collapse of a large wastewater pond in the Tampa Bay area while evacuating the area to avoid a “catastrophic flood.” Manatee County officials say the latest models show that a breach at the old phosphate plant reservoir has the potential to gush out 340 million gallons of water in a matter of minutes, risking a 20-foot-high (about 6.1-meter-high) wall of water. Authorities have closed off portions of the U.S. Highway 41 and ordered evacuations of 316 homes. Some families were placed in local hotels. Crews have been discharging water since the pond began leaking in March. On Friday, a significant leak that was detected escalated the response and prompted the first evacuations and a declaration of a state of emergency on Saturday. A portion of the containment wall in the reservoir shifted, leading officials to think a collapse could occur at any time.

Demonstrators protest a policing bill in England and Wales (Vox) Thousands of demonstrators marched across Britain on Saturday in protest of a massive new policing bill that would create new restrictions on protest in England and Wales and impose hefty fines for not following police instructions. The bill, officially known as the Police, Crime, Sentencing and Courts Bill, was introduced in early March and has been met with widespread pushback in England and Wales since then. It also includes sentencing and court reforms, among other changes, but protesters are specifically incensed by proposed new police powers concerning protests. According to the BBC’s Dominic Casciani, the bill would criminalize violating restrictions that protesters “‘ought’ to have known about, even if they have not received a direct order from an officer,” and “intentionally or recklessly causing public nuisance.” This weekend’s “kill the bill” marches aren’t the first. According to the Guardian, Bristol, in southwest England, has been the site of at least five protests over the last two weeks, including one that turned violent and saw at least two police vehicles set on fire earlier in March.

Marine Le Pen’s growing support (Financial Times) It would be a political earthquake as disruptive as the UK referendum vote for Brexit in 2016 and the election of Donald Trump as US president later that year. Marine Le Pen, leader of France’s extreme right Rassemblement National party, is doing so well in the polls that she threatens to foil Emmanuel Macron’s re-election bid and could win next year’s presidential vote to become the country’s first far-right leader since the second world war. Only last week, she likened herself to Prime Minister Boris Johnson and the UK’s Brexiters—and by implication former US president Trump—as a politician who could triumph with the support of all kinds of voters. “There’s no more split between left and right, there’s a split between the globalists and the nationalists,” she said.

Polish hospitals struggle with surge of virus patients (AP) Polish hospitals struggled over the Easter weekend with a massive number of people infected with COVID-19 following a huge surge in infections across Central and Eastern Europe in recent weeks. Tougher new pandemic restrictions were ordered in Poland for a two-week period surrounding Easter in order to slow down the infection rate. The country hit new records of over 35,000 daily infections on two recent days, and deaths have been in the hundreds each day. The aim of the new restrictions was to prevent large gatherings over the long weekend culminating with Easter Monday. Meanwhile, the government is also trying to speed up the country’s vaccine rollout, but the pressure on the country’s hospitals is still relentless.

Maoist Insurgents Kill 23 Indian Forces in Ambush, Officials Say (NYT) At least 23 Indian security forces were killed in an ambush by Maoist militants in the central state of Chattisgarh, officials said on Sunday, reviving concerns around a decades-old insurgency that appeared to have been largely contained in recent years. A large force of Indian security personnel had been carrying out a clearance operation in a densely forested area on the edges of the Bijapur district when they were ambushed by the insurgents on Saturday in a firefight that lasted four hours. Avinash Mishra, the deputy superintendent of police in Bijapur, said an additional 31 security personnel were wounded in the attack. The insurgents, who trace their roots to communist politics in the 1960s, use violence against the state in the name of championing the cause of India’s poor and marginalized. Their reach was once so widespread, and their attacks so frequent, that in 2006, India’s prime minister declared them the country’s “single biggest internal-security challenge.”

China is betting that the West is in irreversible decline (The Economist) Its gaze fixed on the prize of becoming rich and strong, China has spent the past 40 years as a risk-averse bully. Quick to inflict pain on smaller powers, it has been more cautious around any country capable of punching back. Recently, however, China’s risk calculations have seemed to change. First Yang Jiechi, the Communist Party’s foreign-policy chief, lectured American diplomats at a bilateral meeting in Alaska, pointing out the failings of American democracy. That earned him hero status back home. Then China imposed sanctions on British, Canadian and European Union politicians, diplomats, academics, lawyers and democracy campaigners. Those sweeping curbs were in retaliation for narrower Western sanctions targeting officials accused of repressing Muslims in the north-western region of Xinjiang. China’s foreign ministry declares that horrors such as the Atlantic slave trade, colonialism and the Holocaust, as well as the deaths of so many Americans and Europeans from covid-19, should make Western governments ashamed to question China’s record on human rights. Most recently Chinese diplomats and propagandists have denounced as “lies and disinformation” reports that coerced labour is used to pick or process cotton in Xinjiang. They have praised fellow citizens for boycotting foreign brands that decline to use cotton from that region. Still others have sought to prove their zeal by hurling Maoist-era abuse. A Chinese consul-general tweeted that Canada’s prime minister was “a running dog of the us”. Such performance-nationalism is watched by Western diplomats in Beijing with dismay. Envoys have been summoned for late-night scoldings by Chinese officials, to be informed that this is not the China of 120 years ago when foreign armies and gunboats forced the country’s last, tottering imperial dynasty to open the country wider to outsiders. Some diplomats talk of living through a turning-point in Chinese foreign policy. History buffs debate whether the moment more closely resembles the rise of an angry, revisionist Japan in the 1930s, or that of Germany when steely ambition led it to war in 1914. A veteran diplomat bleakly suggests that China’s rulers view the West as ill-disciplined, weak and venal, and are seeking to bring it to heel, like a dog.

Minorities in Myanmar borderlands face fresh fear since coup (AP) Before each rainy season Lu Lu Aung and other farmers living in a camp for internally displaced people in Myanmar’s far northern Kachin state would return to the village they fled and plant crops that would help keep them fed for the coming year. But this year in the wake of February’s military coup, with the rains not far off, the farmers rarely step out of their makeshift homes and don’t dare leave their camp. They say it is simply too dangerous to risk running into soldiers from Myanmar’s army or their aligned militias. “We can’t go anywhere and can’t do anything since the coup,” Lu Lu Aung said. “Every night, we hear the sounds of jet fighters flying so close above our camp.” The military’s lethal crackdown on protesters in large central cities such as Yangon and Mandalay has received much of the attention since the coup that toppled Aung San Suu Kyi’s elected government. But far away in Myanmar’s borderlands, Lu Lu Aung and millions of others who hail from Myanmar’s minority ethnic groups are facing increasing uncertainty and waning security as longstanding conflicts between the military and minority guerrilla armies flare anew.

Tropical cyclone kills at least 97 in Indonesia, East Timor (Reuters) Floods and landslides triggered by tropical cyclone Seroja in a cluster of islands in southeast Indonesia and East Timor have killed 97 people, with many still unaccounted for and thousands displaced, officials said on Monday. At least 70 deaths were reported in several islands in Indonesia’s West and East Nusa Tenggara provinces, while 70 others were missing, after the cyclone brought flash floods, landslides and strong winds amid heavy rain over the weekend, disaster agency BNPB said.

Lawyer says mediation resolves feud among Jordan royals (AP) Mediation between Jordan’s King Abdullah II and his outspoken half brother, Prince Hamzah, successfully de-escalated one of the most serious political crises in the kingdom in decades, the palace and a confidant of the prince said Monday. The apparent resolution of the unprecedented public feud capped a weekend of palace drama during which the king had placed Hamzah under house arrest for allegedly plotting with foreign supporters to destabilize Jordan, a key Western ally. The announcement of the successful mediation came after Abdullah’s paternal uncle, Hassan, met with Hamzah on Monday. Hamzah was joined by his brother Hashem and three of their cousins. “In light of the developments of the past two days, I put myself at the disposal of His Majesty the King,” said the statement signed by Hamzah. He said he would remain loyal to the king and to Jordan’s constitution. Malik R. Dahlan, a professional mediator and a friend of the family, then issued a separate statement, saying the mediation has “been successful and I expect a resolution shortly.” He said that “this regrettable incident was the result of the clumsy actions of a senior security official and misrepresentation by a government official,” adding that “it should have remained a family matter.”

Netanyahu’s favours were ‘currency’, prosecutor says as corruption trial starts (Reuters) Israeli prosecutors accused Prime Minister Benjamin Netanyahu of treating favours as “currency” on Monday at the opening of a corruption trial which, along with an inconclusive election, has clouded his prospects of remaining in office. Netanyahu, who has pleaded not guilty to charges of bribery, breach of trust and fraud, came to Jerusalem District Court in a dark suit and black protective mask, conferring quietly with lawyers as his supporters and critics held raucous demonstrations outside. Meanwhile, Israeli President Reuven Rivlin began consulting with party heads on who might form the next coalition government—a toss-up after the March 23 election, the fourth in two years, gave neither Netanyahu nor his rivals a clear mandate.

Pandemic Spreads Isolation (WSJ) A year ago when Japan was under a pandemic state of emergency, Seiji Saejima called his ex-wife for the first time since they divorced a few years earlier. He said she told him she was about to remarry and asked him not to call again. It was an unwelcome reminder of the isolation he was feeling. “I did not have many friends to contact even before,” said the 34-year-old, who works at a city government office near Tokyo. Then the pandemic forced reductions in activities that kept him connected, like going to singles’ mixers. “The coronavirus has made me realize I’m lonely,” he said. Recent data suggest many more people are having the same experience, and that is changing the thinking of some governments. Japan recently named a loneliness and isolation minister, following the U.K.’s example from three years ago. The U.K. named a minister after recognizing the impact of isolation on people’s health and its economy. One study linked deficiencies in social relationships to a 29% increase in heart disease. Another estimated that a chronically lonely person could cost the government, on average, the equivalent of an extra $16,600 over 15 years, owing to higher medical and other costs. “The magnitude of effect of social connection on mortality risk is comparable, and in many cases, exceeds that of other well-accepted risk factors, including smoking up to 15 cigarettes per day, obesity and air pollution,” said Julianne Holt-Lunstad, a Brigham Young University professor of psychology and neuroscience, in 2017 U.S. Senate testimony.

#headlines #news

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theculturedmarxist · 3 years

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An old adage known as Betteridge's law of headlines asserts that "Any headline that ends in a question mark can be answered by the word no."

There's a Bloomberg story trending on Twitter right now about China having the ability to control the weather, with the headline reading "Has China Mastered Weather Modification? Should We Worry?"

According to Betteridge, no.

It just goes on and on and on. Every single day the western mass media are bashing us in the face with stories about horrifying scary things other countries are doing which we all need to be afraid of, and from which we must turn imploringly to our own kind and beneficent rulers for protection.

Today China is controlling your weather. Yesterday the Russians were hacking your mind. The day before it was Kremlin microwave guns. Before that it was Chinese super soldiers. Tomorrow Venezuela will be using communist gamma rays to ruin your performance in bed.

And on and on and on and on. And, strangely, at no time will these media institutions warn you about the fact that your government is constantly murdering people in other countries every single day while you and your neighbors struggle to survive.

Right now the hot topic in US lefty discourse is the fact that Americans are struggling financially and medically as a result of Covid-19 and the ensuing lockdowns, yet the US government is doing virtually nothing to help with this. Americans received a piddling one-time $1200 payment eight months ago, and now after all this time they're looking at receiving an even more ridiculous one-time $600 stimulus check.

There's also the debate that's been raging in US left circles over the call initiated by commentator Jimmy Dore for House progressives to force a floor vote on Medicare for All legislation, a big part of the argument being that it's more important than ever to start pushing for a normal healthcare system in the United States right now. Millions of people are being thrown off their employer-provided insurance during the economic downturn and it is both a necessary and opportune time to either implement universal healthcare or at least draw public attention to which elected officials are standing in its way.

Both the campaign to get the US government to implement a proper healthcare system, and the fight to get meaningful financial support during the pandemic, will fail. Necessarily.

They will not fail because there's a lack of public support for these things. They will not fail because of the number of seats controlled by members of a given party in the House or the Senate. They will not fail because "It's just not realistic right now".

They will fail, ultimately, because an entire globe-spanning empire depends upon keeping Americans struggling financially.

The US has a system of deliberately institutionalized poverty because if wealth were more evenly distributed in the most powerful nation on earth, there'd be no ruling class to ensure the domination of the globe-spanning empire. Plutocrats wouldn't be able to use their massive wealth advantage to buy up influence over the political class and control public thought by purchasing mass media outlets and other mechanisms narrative control in order to ensure the continuation of the global status quo upon which those plutocrats have built their kingdoms. The system would belong to the people.

This is the real wall US progressives keep crashing into in their fight for economic justice in America. Ultimately their efforts to work within the official political system to implement economic justice fail because that system is set up to preserve economic injustice. It's not ultimately about this or that political faction or any one particular politician, it's the fact that there's a massive amount of power riding on the ability to keep Americans too poor and powerless to interfere in the operation of the nation which serves as the hub of a massive global empire.

It's like attempts to end the war in Afghanistan. Anyone who isn't a brainwashed dupe knows there's no legitimate reason for western forces to continue that 19-year occupation, yet whenever there's a major push for withdrawal something always comes up. We can't leave because of Al-Qaeda. We can't leave because of women's rights. We can't leave because of Russian bounties. The official talking heads of the political/media class agree that it would be great to withdraw from Afghanistan, but for this or that blah blah reason, "It's just not realistic right now".

The unspoken reality is that those troops are in Afghanistan primarily due to that nation's prime geostrategic location relative to the most powerful nations who oppose the dictates of the US-centralized empire, namely China, Russia, and Iran. The fall of those unabsorbed governments is the only thing that could ever bring about a military withdrawal from Afghanistan.

In the same way, the American left is fed all kinds of reasons for why they need to remain impoverished for a few more years until conditions change in some way, when really the only reason is because there's a massive globe-spanning power structure which depends on their remaining impoverished. It's a larger-scale version of the real reason why Palestinians need to remain oppressed instead of treated as equal citizens in Israel: there's just too much power riding on the control of that crucial geostrategic part of the Middle East for a population with no loyalty to the empire to be given any control over what happens there.

American leftists and progressives will keep crashing into this wall, over and over and over again, every time they try to work within the official US political system to ease the crushing poverty and inequality in the wealthiest nation on earth. If by some miracle they are able to overcome all the many, many, many obstacles built into the plutocrat-controlled system and put themselves in a position to implement policies of economic justice by following all the rules to a 't', there will be an antisemitism scandal. There will be a Russia scandal. Someone will say they were raped. Whatever needs to happen to keep the people from obtaining wealth and power which could disrupt the global world order which depends on endless warmongering that benefits zero ordinary Americans.

Americans will never succeed in fighting economic injustice by appealing to the official US political system, no matter how many charismatic lefty politicians they find and no matter how energized their grassroots campaigns are. Only direct action outside the system, with the people using the power of their numbers to force real change, stands any chance of changing this.

But the bastards have bolted shut that escape route as well. People are prevented from using the power of their numbers to force real change by a highly sophisticated domestic propaganda operation controlled by the media-owning plutocratic class and heavily influenced by sociopathic government agencies. As long as people are being successfully propagandized by mass media manipulation into accepting the status quo, they will never rise up and make it change.

So the US left needs to address the problem of establishment narrative control first, before any change can even begin to occur. This can happen by way of a grassroots information rebellion with a sufficiently forceful push to help their countrymen realize that they are being propagandized. Trust in the mass media is at an all-time low and our ability to network and share information is at an all-time high, so we absolutely do have the ability to pry the rapey fingers of the establishment manipulators out of the minds of the public and help people see that they can have something better. If enough people awaken to the lies of the propaganda machine, they can shrug off the oppression machine like a heavy coat on a warm day, without a shot fired.

But it needs to happen soon, because our rulers understand this as well. This is why we've been seeing escalation after escalation in internet censorship protocols being rolled out by government-aligned Silicon Valley tech giants; they know they need to cut us off from our ability to wake each other up. And they know they need to hurry, because we're already rapidly beginning to do exactly that.

That's where you need to place your emphasis if you ever want economic justice, America. On overthrowing the establishment propaganda machine, and doing it now. Save yourselves and you might just save the entire world.

#imperialism #institutional poverty #medicare for all #universal healthcare #manufacturing consent #narrative control #jimmy dore

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antoine-roquentin · 4 years

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In 2009, when the world was falling apart, a lot of people were asking new President Barack Obama to turn to Paul Volcker, the tall and prestigious former central banker whose reputation was of near God-like stature. Obama did, asking Volcker for advice. But Larry Summers, key advisor to Obama, sabotaged the relationship. Volcker encouraged Obama to stop banks from gambling with internal hedge funds, but Summers wanted banks to keep gambling with internal hedge funds. Summers won the bureaucratic fight.

Volcker’s titanic reputation was by then decades old. But so too was Volcker pursuing honesty in finance, and getting pushed out because of it. In 1986, Ronald Reagan essentially fired Volcker from his position as the head of the Federal Reserve because Paul Volcker was trying to crack down on the junk-bond fueled mergers craze that was clearly corrupting America’s savings and loan banks. Felix Rohatyn, a Democratic fixer and Lazard investment banker, pleaded with the Republicans, “if we sacrifice Paul Volcker for the junk-bond mania, we will clearly show the world that we’ve lost any sense of financial responsibility.”

Here’s a story from 1986, at the height of the frenzy.

Volcker lost the battle at the Fed, and ultimately Alan Greenspan, who was on the payroll of one of the largest corrupt savings and loan banks, took over. Volcker, in pursuing financial rectitude, had no allies except the ‘respect’ of the financial world, which, as it turns out, isn’t worth much at all. And the reason, ironically, is because Volcker killed his greatest would-be allies.

I first ran into Volcker’s career while researching Penn Central, the train system that went bankrupt in 1970 in the greatest then-collapse in American history. It was like the Enron of its time. The Nixon administration tasked the conservative Volcker with overseeing the fiasco, and he was a fairly honest broker. He tried, not very hard, to get a bailout, but when Congressman Wright Patman said no, that was that.

In 1979 Jimmy Carter nominated Volcker to be the head of the Fed. Carter's advisor warned him that Volcker was the "candidate of Wall Street." In an era of red-hot inflation, Volcker's goal was to cut the growth of prices, with the ultimate end of keeping the dollar strong globally. He had popular backing, Americans saw inflation as the most pressing economic problem. Volcker went straight at the auto sector, the unionized pace setting industry which set the informal wage growth patterns of the entire country since the 1950s.

His goal was to crush wages, straight out. To give you a sense of how strongly he felt about this goal, consider that during this period, from the late 1970s to the mid-1980s, Volcker walked around with a card of union wages in his pocket to remind himself that his goal was to crush the middle class. Volcker even angered Reagan officials by keeping interest rates too high for too long. When they complained, he would pull “out his card on union wages” and note that inflation would not come down permanently until labor “got the message and surrendered.” Volcker said that the prosperity of the 1950s and 1960s was a "hall of mirrors" and that the "standard of living of the average American must decline."

Volcker was a deeply conservative, but not corrupt, official. I think the speech that best exemplifies how he thought was one he gave in 1981 before the Economic Club of New York, lauding the bankruptcy and turnaround of the city.

Five years ago, when I last addressed the Economic Club, the preoccupation of the day was the acute financial distress of this great City and State. That big black headline in the Daily News—"Ford to New York: Drop Dead"—was not quite accurate. But in its bold and brazen way, it did carry an essential message. Any lasting solution to our economic problems would have to begin, and end at home.

A month or so ago, I was struck by another headline, this time in a Wall Street Journal editorial: "The Supply Side Saves New York." Somehow, in five years, New York had become an example for the rest of the country to follow.”

Volcker, in other words, was an ardent fan of austerity. And in his speech, he explicitly noted that New York City had no printing press to get out of the fiscal jam it had been in. That was, as Volcker put it, “fortunate.” Instead, the city had to slash expenditures, particularly on the poor. Volcker hoped that the America would take this lesson to heart nationally, and since he ran the printing press, that’s what he made sure happened. He also believed strongly in slashing taxes, government spending, and in deregulation, as he said to businessmen in Kansas City that year.

Volcker raised interest rates radically, crushing small businesses, farms, banks, and credit unions. To many of his fans, and even his opponents, this was simply what had to be done to get inflation out of the system. But there was a brief experiment, if forgotten, experiment in trying a different path, In the spring of 1980, Jimmy Carter encouraged Volcker not to raise interest rates, but to place “credit controls” onto consumer borrowing. Credit controls are direct public rules on specific lending institutions that make it more or less expensive to lend or borrow, and were a major mechanism to keep inflation out of the system during World War Two and the Korean War. And the Fed had the authority to make it more expensive for banks and financial institutions to issue credit cards and lend money to consumers.

Volcker used these tools incredibly poor, clumsily even, with some suspecting he was intending to sabotage the use of regulatory tools he didn’t like. Inflation collapsed, as did interest rates and the economy slid rapidly. Within a few months, Volcker and the bankers got rid of credit controls. Inflation and interest rates jumped right back up, and Volcker was able to discredit credit controls. He then inflicted massive pain on the middle class instead of the banking system by using interest rates and monetary policy, instead of explicitly telling big banks to stop lending.

At the same time as Volcker was destroying unions, small banks, small farms, and small businesses, he was structuring the Too Big to Fail model of finance. In 1980, Nelson and Bunker Hunt, two oil billionaire heirs, tried to corner the silver market in league with Arab interests. Volcker organized a bailout. By 1980, Wall Street had gotten the message. Economist Albert Wojnilower explained, “It is now everywhere taken for granted that no monetary authority will allow any key financial actor to fail."

In the middle of the 1980s, Volcker’s strategy looked like a success. Inflation was gone, the economy was growing, technology seemed to be restructuring society, and the workforce had largely been de-unionized. But there was a something of a mirage, as a bubble in financial leverage through savings and loan banks and junk bonds emerged. Volcker tried to crack down on this bubble, to block the use of junk bonds for certain kinds of seedy transactions. He knew a scumbag when he saw one, and the junk bond peddlers and M&A artists were scum. But by then, his allies against financial corruption, notably the small banks, small business, and unions, were dead or dying. So it was Paul Volcker and all his vaunted respect, versus an army on Wall Street.

There was no contest. The predatory bankers won, as they did again in 2009.

Towards the end of his life, Volcker railed against the corruption he saw everywhere. But he never connected the dots between his own actions destroying public institutions and the inability to constrain the financial corruption he despised. Many people in finance have fond memories of an incorruptible Paul Volcker standing up against financial corruption and reigning in inflation. Which is true. But Volcker really wasn't on the side of democracy, and that's why he oversaw nothing but decline.

I ran into Paul Volcker a few years ago at a conference when I was a Democratic Congressional staffer. He harangued me and said 'why are you Democrats so weak?' I wish I had responded, 'because you killed the unions.'

And that is the tragedy of Paul Volcker.

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kny111 · 4 years

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Meanwhile, the same dilemmas of knowledge, authority, and power have moved beyond the realms of offices, stores, and factories to overwhelm everyone of us and our societies as a whole. In her latest book, Zuboff comes up with a new frame of reference through which to view what Google, Facebook, and the like have been doing—nothing less than generating a new variant of capitalism. They were the first movers in this new world. They declared their right to know, to decide who knows, and to decide who decides. In this way they have come to dominate what Zuboff calls “the division of learning in society,” which she sees as the central organizing principle of the twenty‐first century social order, just as the division of labor was the key organizing principle of society in the industrial age.

The Age of Surveillance Capitalism (a tome of 663 pages, including 127 pages of notes) offers a disturbing exposé of the business model that underpins the digital world in this century. This entails a new mutation of capitalism, which operates by providing “free services” that billions of people use, enabling the providers to monitor the behavior of those customers in amazing detail, often without their explicit consent. “Surveillance capitalism,” Zuboff writes, “unilaterally claims human experience as free raw material for translation into behavioral data. Although some of these data are applied to service improvement, the rest are declared as a proprietary behavioral surplus, fed into advanced manufacturing processes known as ‘machine intelligence,’ and fabricated into prediction products that anticipate what you will do now, soon, and later. Finally, these prediction products are traded in a new kind of marketplace that I call behavioral futures markets. Surveillance capitalists have grown immensely wealthy from these trading operations, for many companies are willing to lay bets on our future behavior” (8).

Zuboff focuses mainly on Google, Facebook, and Microsoft, which she sees as the Petri dishes in which the DNA of surveillance capitalism is best examined. The fact that surveillance capitalism was invented in the United States, in Silicon Valley, and at Google, makes it an American invention, which, like mass production at an earlier stage, became a global reality. For this reason, much of the book deals with the developments in the United States, but with the explicit recognition that the consequences of these developments are worldwide.

What Zuboff adds to the existing stock of knowledge about the general modus operandi of Google, Facebook, and the like is the insight and scholarship to locate those companies in a broader context. She points out that we are dealing with the latest phase in capitalism's long evolution—from the making of products, to mass production, to managerial capitalism, to services, to financial capitalism, and now to the exploitation of behavioral productions stealthily derived from the surveillance of users. She rightly emphasizes that surveillance capitalism is a human creation, which lives in history and is not the result of technological inevitability. It was pioneered and elaborated through trial and error at Google, invented around 2001 as the solution to financial emergency in the wake of the dotcom bust, when the fledgling company faced the loss of investor confidence. As investor pressure mounted, Google's founders Larry Page, and Sergey Brin abandoned their declared antipathy toward advertising. Instead they embarked on a course that boosts ad revenue by using their exclusive access to user data logs in combination with their already by then considerable analytical capabilities and computational power to generate predictions of user click‐through rates, taken as a signal of an ad's relevance. This meant in practice that Google would both repurpose its growing collection of behavioral data, now capitalized on as a behavioral surplus, and develop methods of secret surplus capture that could uncover data which users intentionally chose to keep private—as well as to infer extensive personal information that users did not or would not provide. This surplus would then be analyzed for hidden meanings that could predict click‐through behavior. The surplus data thus formed the basis for new predictions markets involving targeted advertising. Eventually this whole setup became the foundation of a new kind of commerce that depends upon online surveillance at scale.

Contrary to a common misunderstanding, we are not the customers of surveillance capitalism; instead we are the sources of its crucial surplus, the objects of a technologically advanced and increasingly inescapable raw material‐extraction operation. Surveillance capitalism's actual customers are the companies that trade in its markets for future behavior. Zuboff insists that, “as long as surveillance capitalism and its behavioral futures markets are allowed to thrive, ownership of the new means of behavior modification eclipses ownership of the means of production as the fountainhead of capitalist wealth and power in the twenty‐first century” (11).

Surveillance capitalism quickly spread to Facebook and later to Microsoft, while a company like Amazon, with its new emphasis on “personalized” services and third‐party revenue, is clearly veering toward it as well. Zuboff thinks (as yet) differently about Apple, to whom surveillance capitalism is a constant challenge, both as an external threat and as a source of internal debate and conflict. Apple's iPods/iTunes innovations leveraged the new capabilities of digital technologies to invert the consumption experience as had been common in the age of mass production. This inversion depended on a few key elements. Digitalization made it possible to rescue valued assets—in this case songs—from the institutional spaces in which they were trapped. The costly institutional procedures that GM's Alfred Sloan had described in relation to mass production and consumption in the 1920s and after were eliminated in favor of a direct route to listeners. In the case of the CD, for instance, Apple bypassed the physical production of the song along with its packaging, inventory, storage, marketing, transportation, distribution, and physical retailing. The combination of the iTunes platform and the iPod device made it possible for listeners to continuously reconfigure their songs at will. Thus, Apple was among the first to attain formidable commercial success by catering to a new society of individuals and their demands for individualized consumption. According to Zuboff, following a line of reasoning by sociologist Ulrich Beck et al., the conditions of the implicated “second modernity”—in contrast to the “first modernity” of the industrial age and Fordist mass production and mass consumption—produced a new kind of individual for whom the Apple inversion, and the many digital innovations that followed, would become essential. Next to its liberating potential, the second modernity has also brought its troubles. Some of the challenges of the second modernity arise from the inevitable costs associated with the creation and sustenance of one's own life. Zuboff underscores that second modernity instability is also the result of institutionalized shifts in economic and social policies and practices associated with neoliberalism and its rise to dominance. “We live in this collision between a centuries‐old story of modernization and a decades‐old story of economic violence that thwarts our pursuit of effective life” (36‐37).

She considers the possibility of a new synthesis: a third modernity that goes beyond the collision, offering a genuine path to a flourishing and effective life for the many, not just the few. For a while, it seemed that Apple's fusion of capitalism and the digital might set a new course toward a third modernity. In her view, the Apple inversion implied trustworthy relationships of advocacy and reciprocity embedded in an alignment of commercial operations with consumers’ genuine interests. Likewise, at the early stage of Google's development, the feedback loops involved in improving its Search functions produced a balance of power. Google Search needed people to learn from, and vice versa. This symbiosis enabled Google's algorithms to learn and produce ever‐more relevant and comprehensive search results. During this early period, behavioral data were put to work entirely on the user's behalf. User data provided value at no cost, and that value was reinvested in the user experience in the form of improved services. Users provided the raw material in the form of behavioral data, and those data were harvested to improve speed, accuracy, and relevancy and to help build auxiliary products such as translation. Zuboff calls this “the behavioral value reinvestment cycle” (97), in which all behavioral data are reinvested in the improvement of the product or service.

With the introduction of its targeted advertising patent in 2003, Google would no longer be the passive recipient of accidental data that it could recycle for the benefit of its users. Google hereby moved from its advocacy‐oriented founding toward the elaboration of behavioral surveillance as a full‐blown logic of accumulation (and its associated dispossession). In essence, the behavioral reinvestment cycle was subordinated in favor of a new commercial calculation. Behavioral data, whose value was previously “used up” on improving the quality of Search for users, now became the pivotal—and exclusive to Google—raw material for the construction of a dynamic online advertising marketplace. Google would now secure more behavioral data than it needed to serve its users. That surplus was the game‐changing, zero‐cost asset that was diverted from service improvement toward a genuine and highly lucrative market exchange, which Zuboff refers to as “the dynamic of behavioral surplus accumulation” (131).

She poignantly compares the way Google unilaterally declared that the worldwide web was free for the taking for its search engine, to colonial conquest, especially that of the first Spaniards under Columbus who landed on the Caribbean islands. The conquest pattern in question unfolded in three phases: legalistic measures to provide the invasion with a luster of justification, a declaration of territorial claims, and the founding of a town to legitimate the declaration.

Likewise, the first surveillance capitalists simply declared our private experience to be theirs for the taking, for translation into data for private ownership and then proprietary knowledge. They relied on misdirection and rhetorical concealment, with secret declarations that we as users could neither understand nor contest. Or, put differently, first of all there was the arrogant appropriation of users’ behavioral data—viewed as a free resource, there for the taking. Then the use of patented methods to extract or infer data even when users had explicitly denied permission, followed by the use of technologies that were opaque by design and fostered user ignorance. As I should add, one can see all of this as a latter‐day variant of what Jürgen Habermas referred to as the “colonization of the life‐world” by systems, which he did not or could not foresee at the time of his writing.

Zuboff describes surveillance capitalism's antidemocratic and anti‐egalitarian juggernaut in terms of a market‐driven coup de gens from above (rather than a coup d’état in the classic sense): an overthrow of the people concealed as the technological Trojan horse of digital technology implicated in this form of capitalism. On the strength of its annexation of human experience, this coup achieves exclusive concentrations of knowledge and power that sustain privileged influence of the people. It is a form of tyranny that feeds on people but is not of the people. Like the Spanish conquistadores and their silent invocations of the Requirimiento (Monarchical Edict of 1513), surveillance capitalism operates in the declarative form and imposes the social relations of a premodern absolutist authority (513). Paradoxically, this coup is framed as “personalization,” although it tarnishes, ignores, overrides, and displaces everything about the individuals concerned that is personal.

Then there is the further evolution of surveillance capitalism, which moved from a focus on individual users to a focus on populations, such as cities, and eventually on society as a whole. Surveillance capitalism started with advertising, but then became more general. The big tech companies have used the knowledge about their users not only for ever more precisely targeted and more subtle ads but also to sell to other companies, politicians, governments, secret services and any other agency willing to pay for it. By now, surveillance capitalism is no longer restricted to companies or even to the Internet sector. It has spread across a wide range of products, services, and economic sectors, including insurance, retail, healthcare, finance, entertainment, education, transportation, and more, generating whole new ecosystems of suppliers, producers, customers, market makers, and market players.

Driven by competition over prediction products, surveillance capitalists first learned that the more surplus, the better the prediction, which led to economies of scale in supply efforts. Then they learned that the more varied the surplus, the higher its predictive value. This new drive toward economies of scope led them from the desktop to mobile, out into the world, to monitor people's drive, run, shopping, search for a parking space, bodily conditions and face, and always their location. And ultimately, they understood that the most predictive behavioral data can be derived from what Zuboff calls “economies of action” as systems are designed to intervene in the state of play and actually modify behavior, steering it toward desired commercial outcomes. The experimental development of this new “means of behavior modification” can be seen in Facebook's infamous contagion experiments and the augmented reality game Pokémon Go developed at Google. In this phase of surveillance capitalism's evolution, the means of production became subordinate to an increasingly complex and comprehensive means of behavior modification. Thus, surveillance capitalism has created a new form of power that Zuboff terms “instrumentarianism.” It knows and shapes human behavior toward others’ ends. Instead of weaponry and armies, it reaches its goal through the automated medium of an increasingly ubiquitous architecture of “smart” networked devices, things, and spaces.

There are three key approaches to economies of action, the first two of which Zuboff calls “tuning” and “herding.” The third is what behavioral psychologists refer to as “conditioning.” “Tuning” may involve subliminal cues designed to subtly shape the flow of behavior at the precise time and place for maximally efficient influence. Another kind of tuning involves what behavioral economists Richard Thaler and Cass Sunstein called the “nudge,” which they define as “any aspect of a choice architecture that alters people's behavior in a predictable way” (294). The term “choice architecture” refers to the ways in which situations are prestructured to channel attention and shape action.

Conditioning is a well‐known approach to inducing behavior change primarily associated with the Harvard radical behaviorist B. F. Skinner. He called the application of reinforcements to shape specific behaviors “operant conditioning.” His larger project was known as “behavior modification” or “behavioral engineering,” in which behavior is continuously shaped to amplify some actions at the expense of others. Skinner imagined a pervasive “technology of behavior” that would enable the application of such methods across entire human populations. In his 1948 “utopian” novel Walden Two, he brazenly extrapolated from the conduct of conditioning‐subjected animals to grand theories of social behavior and human evolution.

Zuboff outlines the intellectual background of the Skinnerian paradigm as it evolved since the late 1930s, and then focuses on the growth and elaboration of behavior modification as an extension of political power, which is key to her present interests and therefore needs elaboration here. In the 1950s and beyond, the CIA called for ever‐bolder behavior modification research and practical applications from academic psychologists. Scientists from the fields of medicine and psychology embarked on a project to demystify Chinese Communists’ brainwashing techniques, reinterpreting them through the frameworks of behavior modification. Their research concluded that “mind control” was better understood as a complex system of conditioning based on unpredictable schedules of reinforcement, in line with Skinner's findings on operant conditioning.

Skinnerian behavior modification practices expanded rapidly during the 1960s and 1970s, achieving some remarkable success in terms of their advocates’ objectives, but also evoking scrutiny from an often‐hostile public. By 1971, when the US Senate's Constitutional Rights Subcommittee convened hearings on the subject, the migration of behavior modification practices from military to civilian applications was already well underway. Behavior modification techniques had spread from government‐funded (typically CIA) psychology labs and military psychological operations to a range of institutional applications, each driven by a mission to reengineer the “defective” personalities of captive individuals in settings that offered total control or close to it, including prisons, psychiatric wards, classrooms, institutions for the mentally handicapped, schools for the autistic, and factories. A number of journalistic accounts raised alarms about the zealousness with which behavior modification techniques were applied and expressed grave concern that they debased their subjects, violated ethical considerations and infringed on fundamental civil liberties.

Another cause for alarm was the 1971 publication of B.F. Skinner's provocative book Beyond Freedom and Dignity, in which he laid out his social philosophy (already anticipated in Walden Two). Skinner argued that knowledge does not set us free but rather releases us from the illusion of freedom. In reality, freedom, and ignorance are synonyms. The acquisition of knowledge is heroic in that it rescues us from ignorance, but it is also tragic because it necessarily reveals the impossibility of freedom. For Skinner, our attachments to notions such as freedom, will, autonomy, purpose, and agency are defense mechanisms that protect us from the uncomfortable facts of human ignorance. The environment determines behavior, and our ignorance of precisely how it does so is the void that we fill with the fantasy of freedom. Skinner prescribed a future based on behavioral control, rejecting the very idea of freedom (as well as every principle of a liberal society), and cast the notion of human dignity as an accident of self‐serving “narcissism.” He imagined a pervasive “technology of behavior” that would one day enable the application of behavior modification methods across entire human populations. These thoughts triggered a devastating scientific, political, and moral critique from public intellectual Noam Chomsky in a widely read review.

Skinner foresaw powerful new instruments that could engineer behavior in every domain. As early as 1953, he anticipated today's digitally engineered casino environments, whose sophistication in the precise shaping of gamblers’ behavior has made them a testing ground for state security agencies and surveillance capitalists alike. He then also anticipated innovations such as Michael Jensen's incentive systems designed to maximize shareholder value and the choice architectures of behavioral economics designed to nudge behavior along a preferred trajectory. Moreover, Skinner was well aware that the engineering of behavior risked violating individual sensibilities and social norms, especially concerning privacy. In order to assuage these anxieties he advised that observation of human behavior must be unobtrusive, ideally remaining outside the awareness of the persons concerned. However, new technologies of behavior would have to continually expand such privacy invasions in order to access all the data relevant to behavioral prediction and control. In this he anticipated today's data‐harvesting frontier as new detection systems delve deeply into personalities and emotions.

Zuboff points out how the critique of behavior modification in the Senate Subcommittee's 1974 report has direct relevance for our time. It begins by asking a question that we should also ask now: “How did they get away with it?” (324). Just as surveillance capitalism was initially able to take hold and flourish under the auspices of a so‐called “war on terror” and the compulsion for certainty that it evoked, in the mid‐twentieth century the means of behavior modification moved from the lab to the world at large primarily under the cover of cold‐war anxieties. Later, the behavior‐change professionals were called upon by a society turned fearful after years of urban riots, political protest, and rising levels of crime and “delinquency.” The senators argued that calls for “law and order” had motivated the search for quick fixes; immediate and efficient means to control violence and other forms of antisocial behavior, which replaced time‐consuming attempts to understand its source. As so many behavior modification programs aimed at involuntary populations in state prisons and mental institutions, the report recognized that the means of behavior modification had to be reckoned with as a form of state power and questioned the government's constitutional right to “control” citizens’ behavior and mental activity.

The strident rights consciousness of the 1970s drove behavior modification from civilian life and out of the public limelight. However, mostly unknown to the politicians, scholars, rights activists, litigators, and many other citizens who opposed the antidemocratic incursions of the behavioral engineering vision, these methods did not die. The project would resurface as a creature of the market, now tied to unprecedented digital capabilities, scale and scope thriving under the flag of surveillance capitalism. US corporations enjoy the rights of personhood but are free of democratic obligations, legal constraints, moral calculations, and social considerations. Certainly in America, with so much influence of corporate wealth in politics, most elected officials show little interest in contesting behavior modification as a market project, let alone to defend the moral imperatives of the autonomous individual. In its latest incarnation, behavior modification takes the form of a global digital market architecture unfettered by geography, independent of constitutional constraints, and formally indifferent to the risks it poses to freedom, dignity, or the ideals of the liberal society that the 1971 Senate Subcommittee was still determined to defend.

Executives of surveillance capitalism such as Google's Larry Page, Microsoft's Satya Nadella, and Facebook's Mark Zuckerberg do not reveal much about their theories, delivering at best episodic and shallow information. But a core group of scientists and computational social scientists has emerged with detailed experimental and theoretical accounts of the ins and outs of instrumentarian power, providing insights into the social principles of an instrumentarian society. A prominent example is the work of Alex Pentland, the director of the Human Dynamics Lab within MIT's Media Lab. In collaboration with his students and associates, he has vigorously articulated, researched, and widely disseminated a theory of instrumentarian society in tandem with his prolific technical innovations and practical applications. As Zuboff emphasizes, Pentland “completes” Skinner, fulfilling his social vision with big data, ubiquitous digital instrumentation, advanced mathematics, sweeping theory, numerous acclaimed co‐authors, institutional legitimacy, plentiful funding, and corporate friends in high places without having attracted the worldwide backlash, moral revulsion, and anger that Skinner once elicited. She astutely remarks that “this fact alone suggests the depth of psychic numbing to which we have succumbed and the loss of our collective bearings” (419).

Pentland refers to his theory of society as “social physics,” a term that originates in the positivist philosophy of Auguste Comte, and his 1830s programmatic vision of a scientific approach to the study of society that would equal the precision of the natural sciences—a vision that various later thinkers reinvigorated. Although Pentland never mentions Skinner, in his 2014 book, Social Physics, he brings the old behaviorist's social vision into the twenty‐first century, now fulfilled by the instruments that eluded him in his lifetime. Skinner deplored the absence of “instruments and methods” for the study of human behavior comparable to those available to physics. As if in response, Pentland and his students have spent the last two decades determined to invent the devices, methods, and techniques that can transform all of human behavior, especially social behavior, into highly predictive math. A major outcome thus far is the “sociometer,” a wearable sensor that combines a microphone, accelerometer, Bluetooth connection, analytic software, and machine learning techniques designed to lay bare “the structure and dynamic relationships” in human groups.

Pentland outlines his theory of a full‐blown instrumentarian society in terms of five overarching principles, which Zuboff analyzes in depth, thereby showing the strong resemblances with Skinner's thinking and how Pentland updates Skinner's behaviorist utopia (430‐437). This technocratic society, led by a priesthood of data scientists/planners in collaboration with the owners of the means of behavior modification, is based on the pervasive outfitting and measurement of human behavior for the purpose of modification, control, and—given surveillance capitalism's commercial dominance in the digital world—profit.

Zuboff refers to an emergent system that offers us a view of a future defined by a fusion of instrumentarian and state power; the all‐inclusive “social credit” system that the Chinese government is currently developing as the “core” of China's Internet agenda. The aim is to leverage the explosion of personal data in order to improve citizens’ behavior. Individuals and enterprises are to be scored on various aspects of their conduct: where one goes, what one buys, and who one knows. These scores will be incorporated into a comprehensive database that links to government information as well as to data collected by private businesses. The system tracks “good” and “bad” behavior across a variety of financial and social activities, automatically assigning punishments and rewards to decisively shape behavior toward “building sincerity” in economic, social, and political life—a contemporary version of the old communist goal of “engineering of human souls.” The aim is to achieve guaranteed social rather than market outcomes using instrumentarian means of behavior modification.

Worth mentioning is the willingness that some US tech companies have shown to offer the Chinese government a helping hand with state surveillance and censorship. In August 2018, it was reported that Google planned to launch a censored version of its search engine in China, code‐named Dragonfly. By the end of the year, however, the project had effectively been abandoned after a clash within Google, led by members of the company's privacy team. Meanwhile, researchers at Microsoft Research Asia continue to closely collaborate with scholars linked to a Chinese military‐backed university on AI topics such as facial recognition and machine reading. This has raised concerns that the methods and technologies thus generated could very well be deployed in the northwestern region of Xinjiang, where authorities have placed as many as 1.5 million Muslim Uighurs in “re‐education camps” and expanded an intrusive household surveillance system.

Zuboff hastens to point out the similarities between the (US‐dominated) Western and China systems: “Chinese users are rendered, classified, and queued up for prediction with every digital touch, and so are we. We are ranked on Uber, on eBay, on Facebook, and on many other web businesses, and those are only the rankings that we see” (393). “In China, these rankings are public territory, shiny badges of honor and scarlet letters that open or shut every door. In the West, we have ‘likes,’ ‘friends,’ ‘followers,’ and hundreds of other secret rankings that invisibly pattern our lives” (468). Chinese users are assigned a “character” score, while the US government presses the tech companies to develop algorithms for a “radicalism” score. We in the West have our own digital dossiers. Indeed, by means of the shadow text, in which behavioral surplus is lined up for manufacture into prediction products—separate from the first text, which users experience—our behavior is evaluated, categorized, and predicted in millions of ways that we can neither know nor contest.

The existing trend of social engineering and nudging individuals toward “better” behavior is also part of the Silicon Valley approach that holds that human problems can be solved once and for all through the disruptive power of technology. In that sense, perhaps the most disturbing element of the China story is not the Chinese government's agenda per se, but how similar it is to the path big tech companies are taking in the United States and the many regions within its digital orbit.

What can be done to curtail the progress of instrumentarianism? Current US privacy laws have not kept pace with the development of instrumentarianism. When assessing the ways in which digital capabilities challenge existing law, US scholars and jurists focus on Fourth Amendment doctrine which circumscribes the relationship between individuals and the state. It is of course vital, Zuboff writes, that the protections of the Fourth Amendment doctrine catch up to the twenty‐first century by protecting us from search and seizure of our information in ways that reflect contemporary realities of data collection. However, the problem is that even expanded protections from the state do not shield citizens from the assault on sanctuary (legal and otherwise) wrought by instrumentarian power and driven by surveillance capitalism's economic imperatives. Nevertheless, there could be some positive developments at this front, which needs mentioning.

The Cambridge Analytica revelations in March 2018 disclosed that this London‐based consulting firm had harvested the personal information of around 87 million Facebook users and deployed it for political purposes, which triggered congressional and parliamentary hearings, multiple regulatory investigations and a fundamental rethinking of Facebook's future. The US Federal Trade Commission began an inquiry into Facebook's privacy practices, and was joined by the US Justice Department, the Securities and Exchange Commission and the FBI in the summer of 2018. There are also initiatives like the Center for Human Technology, an activist group of former Facebook and Google employees aimed at “the reversal of the digital attention crisis” in trying to create a truly privacy‐friendly Internet. At the time of writing (March 2019), the US Department of Justice has declared that it opened a criminal investigation into Facebook's privacy practices. Facebook is also in discussion with the FTC about a possible settlement in a privacy case that could lead to a fine of several billion dollars.

Apparently panicked by his company's continuous fall from grace, Mark Zuckerberg just announced that Facebook will take a radically different course in the near future, in which “privacy‐focused” social networks will be central. For a start, the message services of Facebook's Messenger, Instagram, and WhatsApp will be integrated into one, which will have end‐to‐end encryption—only readable by sender and receiver, not by Facebook. This is only to be the first step toward a privacy‐oriented Internet. The announcement immediately triggered many responses, from hopeful to outright cynical. Zuckerberg's plan may very well be an ostentatious attempt to dodge penalties and regulations rather than a serious break with the business model that made Facebook into a capitalist behemoth. After all, Zuckerberg envisions a future in which closed, encrypted networks exist next to the open networks that are the standard now. The plan does not mean the end of Facebook's and Instagram's timelines, where users share their lives with many others and whereby Facebook continues its regular surveillance practices for the purpose of offering microtargeted ads that has made the company almost all its money.

Many hopes are set on the new EU regulation known as the General Data Protection Regulation (GDPR) which became enforceable in May 2018. (Part of this law was anticipated by the action of the Spanish Data Protection Agency which, in August 2011, had ordered Google to stop indexing the contested links of 90 Spaniards who had fought for this aspect of their informational privacy under the banner of “the right to be forgotten.”) The EU approach fundamentally differs from that of the United States in that companies must justify their activities within the GDPR's regulatory framework. The regulations include: a requirement to notify people when personal data is breached; a high threshold for the definition of “consent” that puts limits on a company's reliance on this tactic to approve personal data use; a prohibition on making personal information public by default; a requirement to use privacy by design when building systems; a right to erasure of data (= the right to be forgotten), and expanded protections against decisionmaking generated by automated systems that imposes “consequential” effects on a person's life. The new regulatory framework also imposes substantial fines for violations, which will increase to a possible 4 percent of a company's global revenue, and it allows for class‐action lawsuits in which users can combine to assert their rights to privacy and data protection. With the GDPR and such actions as the $1.7 billion fine the European Commission imposed on Google in March 2019 (for forcing users to agree not to accept advertisements from other search engines), the EU is clearly much further ahead than the United States.

Zuboff rightly argues that GDPR's impact will depend upon how European societies interpret the new regulatory regime in legislation and in the courts. And it will not be the phrasing of the regulations but rather collective action by popular movements at the grassroots level that focus on the relevant issues, which shape these interpretations. Importantly, technology is not the inevitable force that the tech leaders want us to believe. She refers to the rich history of digital applications prior to surveillance capitalism that really were empowering and consistent with democratic values. Surveillance capitalism is a human‐made phenomenon. It is therefore in the realm of politics that surveillance capitalism must be tackled. Surveillance capitalism has had two decades to root and flourish relatively unrestrained. From a human rights standpoint, there is a strong need for new paradigms resulting from a close understanding of surveillance capitalism's economic imperatives and foundational mechanisms. The GDPR is a good starting point on which to build to help found a new paradigm of information capitalism.

Zuboff is skeptical of some proposals to solve the problems in question. The idea of “data ownership” is often championed as a solution, but what is the point of owning data that should not exist in the first place? All that it does is further institutionalize and legitimate data capture. More significantly, data ownership also does not reckon with the realities of behavioral surplus. Users might get ownership of the data that they give to surveillance capitalists, but they will not get ownership of the surplus of the predictions derived from those data—not without new legal concepts and interventions built on an understanding of these operations. Furthermore, there may be sound antitrust reasons to break up the largest tech firms, but this fact alone will not eliminate surveillance capitalism. Instead, it will result in smaller surveillance capitalist firms and open the field for more surveillance capitalist competitors. Moreover, large tech companies may shore themselves up against antitrust measures; Facebook is a case in point. Once the recently proclaimed integration of its three messaging platforms—WhatsApp, Instagram, and Messenger—occurs, attempts to break such a bolstered entity up will become all the more difficult.

In the end, Zuboff acknowledges that there is no simple action program to effectively curb surveillance capitalism. But she correctly states that in any confrontation with the unprecedented (which surveillance capitalism most surely is), the work begins first of all with naming. She considers her own work in this regard as the first necessary step toward taming this rogue mutation of capitalism and aims to contribute to a sea change in public opinion, most of all the young.

This is an impressive and illuminating book—a true masterwork. Some reviewers have noted that it reminds them of Thomas Piketty's magnum opus, Capital in the Twenty‐First Century (2014) —that Zuboff herself quotes from—in that it opens our eyes to things we ought to have noticed but overlooked. Through the usage of notions such as “accumulation,” “commodification,” and “behavioral surplus” (playing on the notion of “surplus value”) Zuboff's elaborate analysis reminds this reader more of Capital, Karl Marx's nineteenth‐century quest for the “iron laws” of capitalism. The book is thoroughly sourced and well‐written, accessible yet challenging, thought‐provoking and stimulates deep reflection. It demands a close, slow reading in stages, in order to optimally digest all of this healthy intellectual food. It goes well beyond “an initial mapping of a terra incognita” that will hopefully “pave the way for more explorers,” as is the author's self‐professed intention (17). It introduces an appropriate vocabulary; that is, concepts and frames which enable us to recognize the overall pattern in what seemed to be disparate phenomena, theoretical notions, and fragments of rhetoric and practice. Thus, it provides a comprehensive heuristic schema, an analytical framework that—along with Zuboff's fruitful borrowings and creative integration of relevant insights from an array of philosophers, historians, economists, sociologists (including eminent thinkers like Hannah Arendt, Jean‐Paul Sartre, John Searle, Max Weber, Emile Durkheim, Joseph Schumpeter, Karl Polanyi, David Harvey), data scientists and AI experts—helps us to develop a deeper understanding of the inner workings and logic of the new mutant of capitalism.

There are a few details to take issue with, however. Industrial capitalism is more entrenched and persistent in the United States than Zuboff suggests, and her characterization of its golden, post‐World War II years (lasting until the early 1970s) is rosier than the actual reality was for significant parts of the working population. The New Deal order had a “social‐democratic tinge” (in Richard Hofstadter's terms) that existed in the United States neither before nor after. But it remained by and large confined to the white, male industrial working class, into which members of the second‐generation “new immigrants” from Southern and Eastern Europe had by that time integrated. It is true, however, that the “embedded liberalism” and Keynesian economics of the postwar era tethered market capitalism (however imperfectly) to society's interests. Surveillance capitalism abandons the reciprocities with people of the social compact that then helped to embed capitalism in society.

This also calls the following bold conclusion by Zuboff into question: “The struggle for power and control in society is no longer associated with the hidden facts of class and its relationship to production but rather by the hidden facts of automated engineered behavior modification” (309). To the contrary, capitalist elites (investors, especially venture capitalists) still play crucial roles in financing and (often indirectly) controlling the state of play. Zuboff herself mentions the relevance of the ownership of the means of behavior modification for surveillance capitalism, and refers to the rise of shareholder capitalism and its impact on the management of corporations. Moreover, the scientists, engineers, social scientists, and managers involved, choose (consciously or not) to advance and operate the digital systems in question for the interests of surveillance capitalists. They could make a different choice, as some indeed have done or may very well do in the future. In this context, “production,” should also be understood in a much broader sense than manufacturing to include all kinds of services and highly skilled white‐collar work.

Furthermore, Zuboff's view of the longue durée history of capitalism (apparently inspired by Piketty's observations) seems much too optimistic regarding the possibilities of a capitalism that combines with new forms of organization and ownership to provide a human digital form in tune with a replenished democracy (520‐521). There appears to be quite a lot of wishful thinking here.

We must also realize that relying on a company like Apple (whose earlier practices Zuboff admires) for support in the fight against the excesses of surveillance capitalism is no longer pertinent, if it ever was. Today, Apple presents itself as a moral crusader, fearless, blameless, and ostentatiously restricting collection of its users’ data under the slogan “What happens on your iPhone, stays on your iPhone.” Apple's CEO Tim Cook wants the US government to come up with a stringent privacy law, like that of the EU, in itself a good move but Cook disregards how much power he himself has. Indeed, there is much hypocrisy here. If Apple is so troubled by Google's practices, why is Google Search then the default in Apple's web browser and not a privacy‐friendly variant like DuckDuckGo or Startpage.com? This is simply, of course, because Google pays Apple billions of dollars for this preferential position. Cook admonishes against the “shadow economy” behind online stores, but at the same time Apple keeps its own advertising network for, among other things, the App Store, where 1.4 billion devices get their software from. And why are Google's and Facebook's apps available in the App store at all? The answer is obvious: people would not buy an iPhone with no Google, You Tube, Facebook, WhatsApp and Instagram apps installed on it; apparently Apple's own services do not suffice or are not good enough yet.

At the time of writing, Apple has launched a new platform with paid subscriptions for games, TV series, magazines and newspapers (as yet only two: LA Times and The Wall Street Journal), partly to compensate for a decline in revenues and profits because of slowing iPhone sales. It has announced a series of new TV deals and original programs that will put it head to head with Netflix, Amazon, Hulu and their rivals in streaming media. Apple thereby continues to publicize an emphasis on privacy‐friendly, ad‐free services, with the selection and production of content largely in the hands of human experts—an indirect sneer at Google and Facebook whose financial well‐being depends largely on advertising and automated recommendations. Apple too uses such techniques, but relies more on human selection. Still, on its way to become a provider, following the example of Amazon in trying to combine as many services as possible, Apple may turn into a full‐fledged surveillance capitalist.

Somewhat problematic is Zuboff's conclusion that the instrumentarian power of surveillance capitalism should not be seen in terms of “digital totalitarianism”—an omnipresent Big Brother watching and aiming to control people everywhere all the time—but rather as a nontotalitarian “Big Other” that bends the new digital apparatus to the interests of the surveillance capitalist project, the result of which is an all‐pervading means of behavior modification whose economies of action are designed to maximize surveillance revenues. She draws too sharp a contrast between these two forms of power in suggesting that surveillance capital's instrumentarian power is best understood as the precise antithesis of Orwell's Big Brother. The Orwellian view of what is happening does have a granule of truth in it, with the obvious qualification however, that this now involves first of all commercial surveillance: ubiquitous monitoring by corporate capitalists rather than the state (although in the context of homeland security and the “war on terror” the US government maintains ties to all‐seeing tech companies that remain shadowy and opaque, which whistleblowers like Edward Snowden have informed us about).

But it should then also be recognized that in everyday reality there is a combination of Orwellian and Huxleyan elements. In the dystopian society that Aldous Huxley envisioned in his Brave New World (1932), people are drugging themselves into bliss by various means, thereby voluntarily sacrificing their rights, rather than George Orwell's vision of the future in Nineteen Eighty‐Four (1949), in which totalitarian governments resort to repression by means of ever‐present surveillance, thought control through propaganda, and brutal censorship. In Huxley's dystopia, distractions of the most fascinating nature are deliberately used as instruments of policy, for the purpose of preventing people from paying too much attention to the realities of the social and political situation. It can be argued that contemporary America, formally a liberal democracy, shows culturally a Huxleyan–Orwellian mix of hedonistic entertainment and distraction (with infotainment playing a crucial role), advertising/propaganda (corporate, political, military), surveillance and repression—the latter hardly, if at all, recognized by the mainstream media.

To be clear, none of these issues diminishes the great merits of The Age of Surveillance Capitalism. It will most likely become the definitive work on today's digital capitalism for years to come—an essential read for every engaged citizen in this day and age.

Mel van Elteren - First published: 27 June 2019 - https://doi.org/10.1111/jacc.13051

I remember reading this entire article, non stop, deeply fascinated by the world of counter surveillance capitalist methods and journalism finishing it at exactly 10:00am on the dot like the lord said "this is exactly what I needed you reading" and I wasn't disappointed. I definitely recommend yall check out Shoshana Zuboff's book that highlights the workings and perils of the surveillance capitalist industry that itself relies on white supremacist capitalist patriarchy to thrive.

#tech #technonlogy #democracy #privacy #surveillance capitalism #surveillance cap #illegal surveillance #surveillance systems #government surveillance #news #journalism

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sataniccapitalist · 4 years

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President Donald Trump has been sacking federal watchdogs at the speed of a bullet train. In just a six-week period in April and May, the President fired five Inspectors General of federal agencies. In last Friday night’s coup d’état, Attorney General William Barr, acting as consigliere for the President, ousted the U.S. Attorney for the Southern District of New York, the federal prosecutor that oversees prosecutions of Wall Street banks in that district. The privately owned Federal Reserve Bank of New York, which is in charge of the bulk of the Fed’s bailout programs, also resides in that district.

Barr and the President want to put a man with zero experience as a prosecutor in charge of that office, Jay Clayton, who currently heads the Securities and Exchange Commission which has only civil enforcement powers. Clayton represented 8 of the 10 largest Wall Street banks in the three years before going to the SEC as a partner at Sullivan & Cromwell.

Unfortunately, watchdogs and prosecutors are what American citizens need the most right now as vast sums of money are unaccounted for at both the Treasury and Federal Reserve.

The stimulus bill known as the CARES Act was signed into law by the President on March 27, 2020. It called for “Not more than the sum of $454,000,000,000…shall be available to make loans and loan guarantees to, and other investments in, programs or facilities established by the Board of Governors of the Federal Reserve System for the purpose of providing liquidity to the financial system that supports lending to eligible businesses, States, or municipalities.” In addition, if the Treasury had any of its $46 billion left over that Congress had allotted in the CARES Act to assist airlines or national security businesses, that was to be turned over to the Fed as well.

The CARES Act was passed almost three months ago at the outset of the worst economic upheaval since the Great Depression. One would have thought that the urgency with which Congress acted to pass the legislation would have resulted in rapid deployment of the $454 billion to the Fed to help shore up the economy.

But according to data released this past Thursday by the Federal Reserve, the Treasury has turned over just $114 billion of the $454 billion that was allocated to the Fed by Congress. The Federal Reserve’s weekly balance sheet data release, known as the H.4.1, showed a line item titled “Treasury contributions to credit facilities” and it showed a balance of just $114 billion.

A footnote on the H.4.1 explained exactly which Fed bailout programs had received the money from the Treasury:

“Amount of equity investments in Commercial Paper Funding Facility II LLC of $10 billion, Corporate Credit Facilities LLC of $37.5 billion, MS [Main Street] Facilities LLC of $37.5 billion, Municipal Liquidity Facility LLC of $17.5 billion, and TALF II LLC of $10 billion, and credit protection in the Money Market Mutual Fund Liquidity Facility of $1.5 billion.”

That leaves $340 billion of the $454 billion unaccounted for.

The President’s economic advisor, Larry Kudlow, explained at a press briefing before the signing of the legislation, why the Fed was to get this vast sum of money. The money would be used as equity investments by the Fed in Special Purpose Vehicles that would use the money as “loss absorbing capital,” meaning that taxpayers would eat the first $454 billion in losses. The Fed would then be free to leverage this money up by a factor of 10 to create $4.54 trillion in bailout programs.

Fed Chairman Powell made an unprecedented appearance on the Today show on March 26 and explained the plan like this:

Powell: “In certain circumstances like the present, we do have the ability to essentially use our emergency lending authorities and the only limit on that will be how much backstop we get from the Treasury Department. We’re required to get full security for our loans so that we don��t lose money. So the Treasury puts up money as we estimate what the losses might be…Effectively $1 of loss absorption of backstop from Treasury is enough to support $10 of loans.”

The writers of the CARES Act legislation apparently expected that the Fed might want to keep some of its money transactions a secret because Section 4009 of the CARES Act suspends the Freedom of Information Act for the Fed and allows it to conduct its meetings in secret until the President says the coronavirus national emergency is over.

Both Powell and the Fed’s Vice Chairman for Supervision, Randal Quarles, have repeatedly stated to Congress in hearings that the recipients of these bailout programs would be transparent to the American people. Last Tuesday and Wednesday, Fed Chairman Powell made his semi-annual appearances before the Senate Banking and House Financial Services Committee. He stated the following to both Committees regarding the Fed’s emergency bailout facilities:

“Many of these facilities have been supported by funding from the CARES Act. We will be disclosing, on a monthly basis, names and details of participants in each such facility; amounts borrowed and interest rate charged; and overall costs, revenues, and fees for each facility. We embrace our responsibility to the American people to be as transparent as possible, and we appreciate that the need for transparency is heightened when we are called upon to use our emergency powers.”

But this is the Fed’s web page that shows the disclosures being made to Congress under the facilities that the Fed has designated as emergency lending facilities under Section 13(3) of the Federal Reserve Act. There are 11 programs listed. Just three of the programs, or 27 percent of the total, have provided the actual transaction data showing specific loans to specific recipients.

Those programs are the Secondary Market Corporation Credit Facility, which has spent the bulk of its money buying up Exchange Traded Funds sponsored by BlackRock, the investment manager that the Fed hired to oversee the program; the Municipal Liquidity Facility which has made just one loan of $1.2 billion to the state of Illinois because the terms are so onerous in this program that is supposed to be helping state and local governments survive the pandemic shutdowns; and the Paycheck Protection Program Liquidity Facility, which provided $5.3 billion or 9 percent of its total outlays to a tiny New Jersey Bank that has been cited by the Federal Deposit Insurance Corporation for “unsafe or unsound banking practices.”

But this list of 11 bailout facilities that the Fed is operating is hardly the full picture. On September 17, 2019 the Fed began making hundreds of billions of dollars a week in super low cost repo loans to the trading units of Wall Street’s mega banks. Those loans are ongoing and are currently being made at an interest rate of just 1/10th of one percent interest. Since September of last year, the Fed has made more than $9 trillion cumulatively in these loans. It has not announced one scintilla of information on what specific Wall Street firms have received this money or how much they individually received.

The Fed has also made multiple loans through its Discount Window to Wall Street banks. The Fed has not released the names of these banks or how much they needed to borrow. The Fed has yet to explain how it can continuously be telling the American people that the Wall Street banks are “well capitalized” while it needs to continue to make these lender-of-last-resort loans.

The Federal Reserve has also set up a liquidity facility to make massive foreign central bank dollar swaps to create liquidity for those central banks to buy dollar-denominated assets and help prop up markets. Last Thursday’s H.4.1 shows the dollar swap facility has a current balance of $352 billion. The facility’s balance had been as high as $449 billion as of May 27.

According to the Government Accountability Office’s audit of the Fed that was conducted after the 2008 financial crisis, this is one of the uses of those dollar swap lines back then:

“In October 2008, according to Federal Reserve Board staff, the Federal Reserve Board allowed the Swiss National Bank [the central bank of Switzerland] to use dollars under its swap line agreement to provide special assistance to UBS, a large Swiss banking organization. Specifically, on October 16, 2008, the Swiss National Bank announced that it would use dollars obtained through its swap line with FRBNY [Federal Reserve Bank of New York] to help fund an SPV [Special Purpose Vehicle] it would create to purchase up to $60 billion of illiquid assets from UBS.”

UBS is a major investment bank and trading house and a major player on Wall Street. It purchased the large U.S. retail brokerage firm, PaineWebber, in 2000. The UBS Dark Pool, the equivalent of a thinly regulated stock exchange operating internally within UBS, has been one of the largest traders in Wall Street bank stocks.

The Federal Reserve Board of Governors has put the New York Fed in charge of the bulk of these bailout programs. Its conflicts are legion. (See related articles below.) It’s time for Congress to stop the Fed from repeating its Big Lie that it’s going out of its way to be transparent and force it to cough up the names and dollars amounts of the recipients of these loans.

These Are the Banks that Own the New York Fed and Its Money Button

Is the New York Fed Too Deeply Conflicted to Regulate Wall Street?

The New York Fed Is Exercising Powers Never Bestowed on It by any Law

Instead of Draining the Swamp, the Swamp Is Draining the U.S. Treasury via the New York Fed

The Man Who Advises the New York Fed Says It and Other Central Banks Are “Fueling a Ponzi Market”

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