Twitter: @rodgermitchell; Search #monetarysovereignty
Facebook: Rodger Malcolm Mitchell
Mitchell’s laws:
●The more federal budgets are cut and taxes increased, the weaker an economy becomes.
●Austerity is the government’s method for widening the gap between rich and poor, which ultimately leads to civil disorder.
●Until the 99% understand the need for federal deficits, the upper 1% will rule.
●To survive long term, a monetarily non-sovereign government must have a positive balance of payments.
●Those, who do not understand the differences between Monetary Sovereignty and monetary non-sovereignty, do not understand economics.
●The penalty for ignorance is slavery.
●Everything in economics devolves to motive, and the motive is the gap.
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“Barry Ritholtz is a Bloomberg View columnist writing about finance, the economy and the business world. He started the Big Picture blog in 2003 and is the founder of Ritholtz Wealth Management, an asset management and financial planning firm.”
My opinion: When Ritholtz writes about finance and the business world, he may know what he’s talking about. When he writes about economics, not so much.
Here are some excerpts from an article that includes a bit of both:
Banks Take the Economy Hostage
14 MAY 2, 2014, By Barry RitholtzProsecutors are considering bringing criminal charges against two overseas banks for charges ranging from perjury and fraud to laundering money.
Translation: The subject is overseas banks. Apparently those banks are not important contributors to U.S. politicians‘ campaign funds, nor have they promised U.S. politicians lucrative employment, later.
The reaction has been swift. “Don’t’ play with matches” exhorted Sanford C. Bernstein banking analyst Brad Hintz. Former Federal Reserve lawyer Gil Schwartz warned “The mere threat of requiring a hearing could cause customers to lose confidence in the institution and could cause a run on the bank.”
Translation: If we prosecute the CEO of a U.S. bank, the entire bank will fail, and not just the entire bank, but the entire U.S. banking system — and not just that, but also the entire world’s banking system and national economies all will fail — just for slamming guys like Lloyd Blankfein (Goldman Sachs) and James Dimon (JP Morgan Chase) into the clink.
It used to be thought that fear of indictment, personal disgrace and threat of jail would keep bankers from engaging in illegal activities. But the extraordinary intervention of the U.S. government and Federal Reserve changed the dynamics of prosecution.
Busting those who committed financial crimes would risk undoing all of that. Prosecute our clients, said the bankers’ lawyers, and you risk destabilizing a fragile financial system. Put a systemically important financial institution in your cross hairs, and you put the entire global economy at risk.
Up to here, Ritholtz is on target. He gets it. But,then he misses the point:
The Bush and Obama administrations bought this line of reasoning.
Translation: The innocent politicians were fooled by the banks.
No, Mr. Ritholtz, they weren’t fooled, nor were they concerned about the future of the banking system. They were concerned about the bribes they had accepted from the bankers, and might no longer receive.
After all, a deal is a deal. If you accept money to go easy on criminality, what kind immoral guy would you be to go back on your word?
This argument should never have carried the day. The job of a prosecutor is to prosecute, not to make economic forecasts. Convincing various governmental departments not to do their jobs was a masterful act of salesmanship, one that undercut fundamental principles of rule of law.
Reality: No salesmanship was necessary. The politicians needed a good excuse for not prosecuting criminals and instead rewarding them with big bonuses. OK, it may not really have been a “good” excuse, but it was good enough to fool the masses.
It isn’t the role of the Justice Department, the Securities and Exchange Commission, or the U.S. attorney’s office to make assessments based on the forecasts of economists . . . it was an epic abdication of responsibility– and just because some economist frightened you.
Rest easy, Mr. Ritholtz, no one was frightened — oh except maybe the millions of poor schmucks who lost their houses, their jobs, their life savings and their futures and children’s futures. These people can be told anything, and they will believe it.
Ignoring fraud, perjury and other felonies was a colossal error of judgment.
If becoming rich and powerful beyond most people’s comprehension can be called “a colossal error of judgment,” one wonders what good judgment looks like.
I can hear the politicians now: “Oh, we really wanted to prosecute these criminals, who got rich impoverishing the world. We really did want to put the bums in jail. But, oops, the statute of limitations now has passed, so there is nothing we can do. What a shame.”
(Notice how the Republicans, who attack President Obama on everything — ACA, immigration, gay rights, abortion, unemployment, Benghazi, deficits and debt — have remained curiously silent about his not prosecuting financial criminals. The Republicans too receive bribes from those criminals.)
Meanwhile, Pat Quinn, the Governor of Illinois, wants to spend $100 million taxpayers’ dollars to build an ode to President Obama (laughingly known as a “library”) in Illinois, as a tourist attraction.
That will assure Quinn’s next campaign fund and lucrative jobs after office (unless he goes to jail first — an Illinois governor tradition).
Rodger Malcolm Mitchell
Monetary Sovereignty
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Nine Steps to Prosperity:
1. Eliminate FICA (Click here)
2. Federally funded Medicare — parts A, B & D plus long term nursing care — for everyone (Click here)
3. Provide an Economic Bonus to every man, woman and child in America, and/or every state a per capita Economic Bonus. (Click here) Or institute a reverse income tax.
4. Free education (including post-grad) for everyone. Click here
5. Salary for attending school (Click here)
6. Eliminate corporate taxes (Click here)
7. Increase the standard income tax deduction annually
8. Increase federal spending on the myriad initiatives that benefit America’s 99% (Click here)
9. Federal ownership of all banks (Click here)
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10 Steps to Economic Misery: (Click here:)
1. Maintain or increase the FICA tax..
2. Spread the myth Social Security, Medicare and the U.S. government are insolvent.
3. Cut federal employment in the military, post office, other federal agencies.
4. Broaden the income tax base so more lower income people will pay.
5. Cut financial assistance to the states.
6. Spread the myth federal taxes pay for federal spending.
7. Allow banks to trade for their own accounts; save them when their investments go sour.
8. Never prosecute any banker for criminal activity.
9. Nominate arch conservatives to the Supreme Court.
10. Reduce the federal deficit and debt
No nation can tax itself into prosperity, nor grow without money growth. Monetary Sovereignty: Cutting federal deficits to grow the economy is like applying leeches to cure anemia.
Two key equations in economics:
1. Federal Deficits – Net Imports = Net Private Savings
2. Gross Domestic Product = Federal Spending + Private Investment and Consumption – Net Imports
THE RECESSION CLOCK
Vertical gray bars mark recessions.
As the federal deficit growth lines drop, we approach recession, which will be cured only when the lines rise. Federal deficit growth is absolutely, positively necessary for economic growth. Period.
#MONETARY SOVEREIGNTY
#Monetary Sovereignty - Mitchell 