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According to the Collins English Dictionary 10th Edition fraud can be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage".[1] In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation. Defrauding people or entities of money or valuables is a common purpose of fraud, but there have also been fraudulent "discoveries", e.g. in science, to gain prestige rather than immediate monetary gain
*As defined in Wikipedia

Wednesday, September 5, 2012

Goldman Sachs Needs Us Far More Than We Need Goldman Sachs

Two concepts that may grab your attention are:

--the risks taken by Banks like Goldman Sachs are a form of social pollution, and
--the banks enjoy layers of public assistance and that is why they exist to this day.

Rob Ure in an article in Counterpunch called The Finance Bomb talks about how the banks continue to exist in spite of their many risks, their multiple bailouts and the public damage caused by their risky activities.  He talks about how quantitative easing by the Federal Reserve is touted as a means to help everyone in the economy while it really only supports the plutocracy--the rich grow richer and the rest suffer loss.  QE openly rigs the financial system for the benefit of the rich.

Ure points out that "Wall Street continues to exist through public assistance."

When you consider bank risk as a pollutant that affects everyone in society, even the innocent, then we can easily see the benefit of doing away with such pollutants, not just regulating less pollution but doing away with the banks so that there is no pollution.

"The banking industry is also a pollutant. Systemic risk is a noxious by-product. Banking benefits those producing and consuming financial services – the private benefits for bank employees, depositors, borrowers and investors. But it also risks endangering innocent bystanders within the wider economy – the social costs to the general public from banking crises."  (from a paper written by Andrew G. Haldane, Executive Director, Financial Liability, Bank of England, March 2010, entitled The $100 Billion Question)
. . . . . . . . . . . . . . . . .  

The Finance Bomb
Who Will Bear the Brunt of "Deficit Reduction"?
By Rob Ure - Counterpunch
. . . .
 The situation for the banks requires multiple additional layers of public assistance to make sense of. In 2008 it became obvious that most of the large banks in the West (Wall Street) were insolvent. That is, bad loans exceeded bank capital and cross-liabilities exceeded systemic capacity to pay. With QE (and multitudinous other public assistance programs) the Fed was able to raise the prices of bank assets above what they otherwise would be. QE also allowed banks to raise cheap capital by selling stock and bonds at much better prices than they otherwise would have received. And finally, government guarantees (too-big-to-fail—‘TBTF’) allow Wall Street to continue to exist by perpetuating the illusion that individual bank failures won’t lead to systemic collapse (as they did in 2008).

Read the whole article here


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