Demonizing “the 1%” is mathematically incorrect; rather it is the oligarchs - which refers a small handful of people who benefit most disproportionately from Federal Reserve handouts, D.C. corruption, tax code loopholes and the destructive trend of financialization generally - that should be kept a close eye on. Thanks to The Atlantic, we now have two charts that show what we have been writing about for many years now. It is not the 1% that is the problem, it’s actually a much smaller slice within that group that is thieving and pillaging at will from the rest of American society.
When one reads stories such as the following report from the FT, in which we learn that former Chinese president Jiang Zemin "has urged the current leadership to rein in an anti-corruption campaign that is proving the harshest in decades and is seen as threatening the interests and networks of some Communist party elders", or said otherwise - his cronies, aside from being utterly speechless at the rapid unravelling of the bizarro world, all one can say is - expect such developments in the US in a few years time, when then former president Obama asks Clinton, Christie or whoever the then-reigning dictator of the totalitarian states of America is, to take it easy on the Corzines of the world.
Being a kleptocratic crook in China is now becoming a higher risk proposition.
One of the evils of massive over-financialization is that it enables Wall Street to scalp vast “rents” from the Main Street economy. These zero sum extractions not only bloat the paper wealth of the 1% but also fund a parasitic bubble finance infrastructure that would largely not exist in a world of free market finance and honest money. The infrastructure of bubble finance can be likened to the illegal drug cartels. In that dystopic world, the immense revenue “surplus” from the 1000-fold elevation of drug prices owing to government enforced scarcity finances a giant but uneconomic apparatus of sourcing, transportation, wholesaling, distribution, corruption, coercion, murder and mayhem that would not even exist in a free market. The latter would only need LTL trucking lines and $900 vending machines. In this context, the sprawling empire known as Bloomberg LP is the Juarez Cartel of bubble finance.
This is no plain modern event with civil unrest erupting because of an interconnected world. These are grassroots uprisings cross-fertilized perhaps from a world contagion yet they often have similarities – corrupt governments. Turkey, Ukraine, Thailand, Venezuela and Bosnia-Herzegovina are all middle-income democracies with elected leaders besieged by people angry at misgovernment, corruption and economic sclerosis. These days it is no longer just dictators who have something to fear from the crowd. This is the promise of Marxism that centralized planning and false promises are coming home and governments are too corrupt and incompetent to deliver what they have claimed for decades.
With Chinese authorities increasingly looking like they are sticking to their reform promises, fighting moral hazard and allowing defaults to occur (in a completely 'contained' way, of course); the continued crackdown on graft and government corruption has hit a new high (or low). As Reuters reports, Chinese authorities have seized assets worth at least 90 billion yuan ($14.5 billion) from family members and associates of retired domestic security tsar Zhou Yongkang, who is at the center of China's biggest corruption scandal in more than six decades. 71-year-old Zhou has been under house arrest since first being investigated late last year but the size and scale of the corruption is unprecedented including 300 apartments, 60 vehicles, bonds, stocks, and gold - "it's the ugliest in the history of the New China."
No tree grows to the sky. Once extremes are reached, trends reverse, often with symmetry: the decline often matches the ascent. Which leads to an interesting question: have we reached Peak Putin? The capture of a few pawns has cleared the chessboard, but the strategic choices already made have greatly reduced Putin's room to maneuver.
Initial "Results" From Turkish Municipal Elections Show Resounding Victory For Erdogan's Ruling PartySubmitted by Tyler Durden on 03/30/2014 13:52 -0400
IIn a country which has banned the free flow of information via social networks and other venues in order to preserve the corrupt government, why one would believe any official data is unclear, but for those who are curious, here are the early results from today's municipal elections (where eight people have already died as fights broke out between rival candidates in two villages near the southeastern border with Syria): with 12.4% of ballots counted, the ruling AKP party appears to be a blowout victory, with 48.1% of the vote, while CHP has 24% and MHP is at 13.8%, based on CNNTurk reporting. And, as expected, there are huge discrepancies between the numbers provided by the state run news agencies, and the pro-Gulen, Cihan, news agency.
It just hasn't been JPMorgan's year. Or several years for that matter. The bank which has been on a steady downward slope when it comes to paying billions in quarterly "non-recurring, one-time" legal settlements and charges, and for which engaging in criminal behavior which is neither admitted nor denied, yet which has cost JPM nearly $30 billion in the past several years, has just had its latest "wristslapping" incident, one which involves none other than the recently departed CEO of JPM Asia, Fang Fang, whose office was raided on March 26 by Hong Kong's anti-corruption agency amid a U.S. investigation into the bank’s hiring practices as reported by Bloomberg.
Moody's Puts Russia On Downgrade Review; Cites Event Risk, Investor Sentiment, And Weakening EconomySubmitted by Tyler Durden on 03/28/2014 18:02 -0400
Hot on the heels of what S&P said was not a "politically motivated" shift to rating watch, Moody's (who did not downgrade the USA and are not currently in a lawsuit over such terrible misrepresentations) has decided now is the time to put Russia on rating downgrade watch. The decision was triggered by 3 key factors: the weakening of Russia's economic strength, potential shifts in investor sentiment, and susceptibility to event risk. Full report below...
East Asian work culture is world renowned for its long hours and exhausted laborers. Japanese salary men hustling to catch the last train home, their sleeping bodies stretched out along the seats (sometimes in curiously uncomfortable positions), is an image familiar to many people across the world. Despite having the some of the world’s best-kept records on the subject, however, death from overwork is far from unique to Japan. Instances of it have been known to occur the world over, not least in China, which now reportedly leads the world in work exhaustion-related deaths.
UPDATE: *TURKEY'S DAVUTOGLU SAYS LEAK IS 'DECLARATION OF WAR': TURKIYE
As we noted here, Turkish Prime Minister Erdogan had blocked Twitter access to his nation ahead of what was rumored to be a "spectacular" leak before this weekend's elections. Then this morning, amid a mad scramble, he reportedly (despite the nation's court ruling the bans illegal) blocked YouTube access. However, by the magic of the interwebs, we have the 'leaked' clip and it is clear why he wanted it blocked/banned. As the rough translation explains, it purports to be a conversation between key Turkish military and political leaders discussing what appears to be a false flag attack to launch war with Syria.
It has happened over and over again throughout history. Nations, empires, and dynasties have made bad economic decisions which lead to their own destruction. The scenario usually goes something like this--one generation sacrifices and works hard to overcome global challenges and creates an economic powerhouse, which in turn allows it to project military power. Follow on generations take their elders work for granted and ignore and even denigrate the fruits of hard labor, they just want the benefits and start giving away the spoils for free. The next generation indulges itself in sloth and corruption and is overrun by the barbarians.
Cronyism for the super wealthy starts at the very top with the Federal Reserve System, which consists of topdown economic central planners who manipulate the money supply and hence interest rates for the benefit of the financial oligarch class. It then trickles down through lobbyist money into the halls of Washington D.C., and ultimately filters down to local governments and then the average person on the street gaming welfare or disability. As such, we now live in a culture of corruption and theft that is pervasive throughout society. As a new report finds, "You can’t reform welfare programs for the poor until you’ve gotten Daddy Warbucks off the dole. Voters will insist on that - as well they should."
A Turkish court has ruled against Prime Minister Erdogan's unilateral decision to ban Twitter from the nation after the threatened leak of corruption allegations. As The FT reports, the Ankara district court imposed a stay on the measure after hearing arguments from the Turkish Bar Association that the ban was disproportionate and illegal. While government officials have agreed they would implement the court's ruling, so far there has been no change. Twitter has officially responded expressing concern at the ban and filing further petitions to have it lifted as rumors spread of a "spectacular leak" in the next few days ahead of Sunday's elections.