Financial Crisis Notice of Meeting

YOU ARE PAYING!
WHAT’S THE ALTERNATIVE?
THE FINANCIAL CRISIS
—your questions answered.
THIS GREED WAS BEYOND IRRESPONSIBLE!
Kirkintilloch Leisure Centre Conference Room
Saturday 7th February, 10.30am– 12.30pm
Facilitated by the SSP co-convenor,
Frances Curran
Speakers—Raphie de Santos— was head of Equity Derivatives Research and Strategy at Goldman Sachs International. He was an advisor on derivatives and financial markets to the Bank of England, London Stock Exchange, London International Financial Futures and Options Exchange and the Italian Ministry of Finance. Raphie has been a guest lecturer on derivatives and financial markets at Harvard and New York universities and the London School of Economics and has spoken at the annual Nobel Foundation conference in Stockholm.
Bill Newman spent most of his working life in banking, latterly as head of economics and then as Assistant General Manager of a City of London bank. For some 15 years he was also editor of and wrote for a journal on international monetary economics.
Bill was also on the Executive Committee and the Management Committee of the Banking, Insurance and Finance Union (BIFU) and a delegate to the TUC.

THE CAMPSIE BRANCH SSP invite your participation in this important discussion. How will this crisis effect YOU?

About the Scottish Socialist Party
While it fights to defend jobs, working conditions and living standards and for houses and health the SSP also demands a new economy.
Such an economy would start the task of harnessing the stupendous technological and material resources which already exist to meet the needs of society rather than the greed of the few.

Link to Campsie Branch of the SSP in the sidebar

Financial Institutions and Toothless Regulators

It looks as if they might just about stopped the financial world from unravelling but recent events make my previous comments (12th September) look strangely prophetic. The banks with the most money are gobbling up the lesser banks and we all know the consequences of that for the workers in the financial services industry. The corridors of the Parliament (both in Westminster and Edinburgh) are awash with crocodile tears as the Capitalist system creaks under the strain of unfettered greed. Apparently 'Greed is good' doesn't apply any more.

Meanwhile the regulator issues a toothless ban on short selling of the shares of banks and insurance until the end of the year. The whole system of share trading has turned into a giant casino where no-one really knows the rules, because there are no effective rules. Big Gordy and Smirky Salmond might try to scapegoat the short sellers, but they were acting completely within the law, and it is Governments which still make the law. The fact that there are too many financial institutions in the USA and the UK which have grown so large that if they are allowed to go down they take the country with them is a national disgrace. It means that they can indulge in massively risky behaviours in the knowledge that the taxpayer will cover the losses should they fail.

The real answer is to break them up, and sooner rather than later and preferably put them into public ownership so that the workers who generate the profits share in the success of the enterprise, rather than the present situation where the greed generates massive losses, the workers lose their jobs, the bosses walk away with all the remaining assets, and the taxpayer bears the loss.

This crisis was avoidable, and had the regulators real powers to stop abuse then the people would have been better protected.

Nationalisation of Financial Institutions

Now that the UK has effectively nationalised Northern Rock (almost the first birthday of the nationalisation) and the USA has effectively nationalised both Fannie Mae and Freddie Mac, we can only applaud this new spirit of public ownership. It's just a pity that the taxpayer always seems to get lumbered with the losers rather than the shareholders who were paid large dividends rather than creating reserves to see their companies through financial crises. It's also a pity that the same spirit of providing a safety net for investors couldn't have been brought to bear on the problems of Farepak, but then their investors weren't already the rich so they don't count for much to Big Gordy.

Just a further comment on the global financial meltdown. Money doesn't just disappear, so if everyone is going to get poorer, who is going to get richer? Capitalists are fighting like ferrets in a sack each trying to save his own arse at the expense of the rest and, as usual, the poorest will pay the price and the rich will get richer. Banks are queueing up to buy each other at bargain basement prices and it's about time the national and international regulators stepped in and sorted out this fucking mess they have allowed to be created by pure greed.

Pensions Crisis and the Financial Services Rip-Off

It is well known that I am no fan of Gordon ‘the big clunking fist’ Brown, but the current obsession with pensions crisis needs a more simple explanation, so it will be my cause to give it a try

Firstly, private pension provision is only available to those who can afford it, but speaking to some less well off people they believe that it is the state pension which is under threat. They do not appreciate, because the papers do not properly explain it, that if the better off pay more tax, then the less well off might be required to pay less. The papers try to give the impression that what is good for the middle classes is good for the whole country. Obviously in their agenda the less well off who may have no private pension don’t matter.

Secondly, the crisis arises because the financial sector of the economy by buying and selling stocks and shares at ever higher and unjustified values and trousering the profits put themselves in a position that, because of the high value (completely notional) of those shares as assets on their books, they believed that they were financially sound and their pension schemes were in surplus.

Because they imagined a surplus they gave themselves a ‘contribution holiday’; in other words, the money that they should have been investing in the pensions of their employees was paid out to their shareholders. The employees were never told that they had too much money in their pension fund and that they didn’t need to contribute for a while. Not bloody likely.

Now they find that they were too greedy and since their bubble has burst and shares have fallen to more realistic levels it is everyone’s fault but theirs. But who will suffer as a result of the fact that workers’ entitlement was given to shareholders. Well, not the shareholders. Certainly not the greedy directors and financiers. Yes, you guessed it, the employees.

Just another disgraceful episode in the world of high finance (grand larceny) that is capitalism.

I hope that this clarifies my views on the subject, I certainly feel better for getting it out

Scottish Nationalists and the Millionaires Club 3

A bit in the front of the Herald today might throw some light on the attraction of the Nats for the millionaires club.
It reports that a leading financier, one Ben Thomson, chairman of the investment bank Noble Group, backs the Nats because a Nat win would rid the finance sector of 'over-regulation from London'.

He obviously sees an opportunity for the financial sector to benefit from a reduction in regulation, and while I support the independence cause I am not sure that the Nats., who seem to have some unsavoury friends, are the right people to take us there. I hope that this is just a coincidence and not another under the counter deal done in advance of an election (a 'Souter' ? )

Looking back over the recent past it might even appear, when we think about Farepak, illegal bank charges, endowment mis-selling, millions lost in tax avoidance schemes, and the general bolox the financial sector has made of pensions with the assistance of 'the big clunkin fist' that a lot more regulation and scrutiny is required, not a lot less irrespective of whether it comes from London or Edinburgh.