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mother earth

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Member since: Wed Nov 10, 2004, 05:08 PM
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Keiser Report: Grexit already happened? (E768) June 9, 2015

Published on Jun 9, 2015

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss leaving the Troika to gloat over the devastation that is Europe. In the second half, Max interviews Ross Ashcroft of RenegadeInc.com about crowdfunding his own content in order to educate the population about the economic news the BBC refuses to tell and they discuss the fact that there has already essentially been a Grexit, Greece is gone. What else can be done.

Elizabeth Warren: It Has to Stop! Predatory Fin. Practices & Economic Injustice

Elizabeth Warren - Access and Opportunity: Predatory Financial Practices and Economic Injustice

Published on Jun 8, 2015

On Monday, May 11, 2015, Rep. Elijah E. Cummings, Ranking Member of the House Committee on Oversight and Government Reform, and Senator Elizabeth Warren held the fifth in a series of congressional forums as part of the Middle Class Prosperity Project launched by the Members in February. The forum, "Access and Opportunity: Predatory Financial Practices and Economic Injustice," took place at the University of Maryland Carey School of Law in Baltimore.
Posted by mother earth | Mon Jun 8, 2015, 06:28 PM (2 replies)

Varoufakis' Tribute to John Nash, Ideal Money


In conversation with John Nash Jnr on Ideal Money

Posted on June 2, 2015 by yanisv

A conversation I was privileged to have with John Nash in June 2000 is posted below as a small tribute to a great man.
(The conversation was motivated by a talk John Nash Jr gave in Athens in 2000 entitled IDEAL MONEY. The text of the conversation below was published in 2001 as a chapter in a volume, available only in Greek, entitled Game Theory: A volume dedicated to John Nash, edited by K. Kottaridi and G. Siourounis)
Yanis Varoufakis: Professor Nash, in your talk on Ιδεώδες Χρήμα (Ideal Money, June 2000) at the Old Parliament House in Athens, you commented, in relation to the Eurozone, that membership of a club makes sense only if it is exclusive. (Greeks know this well enough since the earlier consensus among experts that Greece would not be allowed in, made the project of entry into the Eurozone particularly popular here.) Then you strengthened your claim by suggesting that if everyone joins an alliance, the alliance is absurd. But is it? Does a Grand Alliance not gain meaning if its establishment entails unanimous agreement by all members regarding its institutions? Is it not akin to a Grand Bargain over the precise mechanism for distributing gains? (Something like agreeing on the properties a cooperative solution should possess?) And if so, does a Grand Alliance not make sense as a framework for conflict resolution?
John Nash Jr: The words ‘club’ and ‘alliance’ do not have the same meaning. This is why in game theory we use a third word which also differs conceptually from the first two words: ‘coalition’. It is of course true that it is possible to have a coalition between all the nations (or the states) of the world. The Universal Postal Union, with its Berne headquarters, is a good example. Mind you, it would be far fetched to refer to this union as a ‘club’. I am not sure I can recall the precise phrase I used in my talk. Nevertheless, a truly Grand Coalition, that includes ‘everyone’, is an important and natural concept of game theory. It is the means by which an efficient (in the context of Pareto’s definition) agreed resolution to disputes can be imagined following mutual concessions.
Yanis Varoufakis: Regarding your specific proposal (that is, a new Gold Standard based not on Gold but on a basket of suitably weighted material commodities), is your ‘ideal money’ meant as a proxy for transferable utility (such that the outcome of exchanges can become genuinely independent of the way payoffs are calibrated)?
John Nash Jr: The value of effective transferable utility is obvious. However, as far as contemporaneous transactions within the ‘walls’ of a domestic economy are concerned, the transferability of values can be eased equally well by ideal and non-ideal money. But when it comes to inter-temporal, long-term transactions, e.g. mortgages, the difference between ideal money and typical European currencies would be somewhat intense, if not dramatic.

(For more, see link above.)


Mathematician John Nash spoke of tweaking Einstein’s theory of relativity days before death


Three days before Nash and his wife, Alicia, were killed in a car accident on the New Jersey Turnpike, the famed mathematician discussed his changes to Einstein’s theory in Norway on May 20.

“There’s nothing secret about the equation Nash was studying,” French mathematician Cédric Villani told the Daily News.

Nash, 86, had been working on a modified equation for general relativity — which describes movement relative to space and time — for decades, Villani said. Nash even discussed his ideas with Einstein in the ’50s, but their talk was “not productive.”

The Nobel Prize winner “thought he had a better model” for the theory first devised in 1916, said Villani, a Fields Medal winner.

There are some discrepancies between the theory of relativity and other areas of physics, Villani said.


John Nash, ‘A Beautiful Mind’ Laureate, Dies in Crash

John Nash, the Princeton University mathematician and Nobel laureate whose towering intellect and descent into paranoid schizophrenia formed the basis of the Academy Award-winning movie “A Beautiful Mind,” has died. He was 86.
Nash and his wife, Alicia, were killed when the taxi they were riding in crashed on the New Jersey Turnpike Saturday afternoon, ejecting the couple, New Jersey State Police Sergeant Gregory Williams said Sunday.
The Royal Swedish Academy of Sciences awarded the 1994 Nobel Prize in economics to Nash, John Harsanyi of the University of California-Berkeley and Reinhard Selten of the University of Bonn in Germany for their work in game theory, which seeks to understand how people, governments and companies cooperate and compete.
“John’s remarkable achievements inspired generations of mathematicians, economists and scientists who were influenced by his brilliant, groundbreaking work in game theory, and the story of his life with Alicia moved millions of readers and moviegoers who marveled at their courage,” Christopher Eisgruber, president of Princeton University, said in an e-mailed statement.

Posted by mother earth | Mon Jun 8, 2015, 06:08 PM (0 replies)

"we need to fix the banking system, not Greece, and let Greece fix itself." --In a nutshell & YES

Taken from full article:

Greece's and the Eurozone's Best Move -- Adopt Limited Purpose Banking and Then Default


In other words, the so-called Greek crisis is not really about Greece, but about the chance that if Greece does what it clearly must do, namely default, its banking system and everyone else’s will collapse. If that’s the case, we need to fix the banking system, not Greece, and let Greece fix itself.

But can a bank run in relatively tiny Greece represent such a big concern? Yes. Recall the December 2013 banking crisis in Cyprus, whose economy is peanut-sized. The prospect of Cypriot bank runs triggering bank runs throughout the Eurozone sent shivers down European Central Bank chairman, Mario Draghi’s, spine. He quickly came to the rescue. Draghi was not taking a chance, however small, of a massive, collective loss of trust like that triggered by Lehman Brothers’ bankruptcy.

But why is the banking system so fragile? The answer is simple. No other industry in the world operates so deeply in the dark. No other industry provides so little disclosure of what it owes and owns. No other industry has such eye-popping leverage – leverage that is little changed despite Dodd-Frank, Basel III, the Vickers Commission, and other so-called U.S. and international banking reforms. And no other industry engages in such rampant and unabashed deceit, corruption, malfeasance, and political bribery.

Pervasive opacity, extreme leverage, and rarely prosecuted criminality – those are the terrible hallmarks of the world’s Wall Streets. One can’t conceive of a more dangerous way to run any economic sector, let alone one that constitutes a critical public good, namely the financial exchange system.

The Greeks fully understand their potential to gravely damage EU unity and the global built-to-fail, faith-based banking system. Indeed, this is their main negotiating trump card. But blackmailing their partners and abjuring major fiscal reform (required with or without default) is not in Greece’s long-term interest. Nor is it in the interest of other EU members to perpetually police Greece’s fiscal behavior. What’s needed is a way for Greece to default without bringing down the Greek financial system, let alone overall financial exchange

Article written by: Laurence Kotlikoff, professor of economics at Boston University, a Fellow of the American Academy of Arts and Sciences, a Research Associate of the National Bureau of Economic Research, a contributor to Bloomberg, the FT, the Economist, Forbes, and other media and President of Economic Security Planning, Inc.

Comments welcome. I can't believe someone actually had the audacity to come out and say it, it's the banks...OF COURSE. While we await an outcome, the truth is...well...apparent. Yet, what direction will be taken is not clear...since it's been said default is possible with or without leaving...which is really what we want to know. We know the debt is crazy & unsustainable, it's the interest too, it's all crazy, all this austerity, all the beggary thy neighbor, the disaster, predatory capitalism, the corrupt entities that all made it possible...damn that Troika!

Posted by mother earth | Mon Jun 8, 2015, 04:40 PM (4 replies)

There is no morality in how Germany conducts istself amongst its EU counterparts as well.

Twist and turn it however you want, Germany’s blatant violations of EMU regulations can no longer be covered up. Those, such as Der Spiegel, stay far from the truth even if they do not lie outright. When will Der Spiegel inform its readers of the simple truth that the Germany’s mercantilist economic model is based on undercutting its trading partners so that it accumulates surpluses while creating deficits and debt everywhere else? When will the ‘truth commission’ of Der Spiegel – seventy people in total – understand that only a deterioration of German competitiveness (through rising wages) and declining surpluses vis-à-vis its trading partners can help to overcome deflation and stimulate economic growth of all countries inside EMU? It does not seem likely that this will happen in the foreseeable future; the collective fear to face the truth is insurmountable.

Another example: in an interview in past week’s printed edition of Der Spiegel, Wolfgang Kauder, the leader of the CDU/CSU party group in the German Bundestag, said: ‘If Greece wants more money from its European partners, it must pass reforms. Perhaps it helps to realise that it is not the European bailout policy that has driven Greece into misery, but the failure of their own elites.’ If someone makes a statement like this, you would expect that any professional journalist would question why only recently the economic policy of the country has led to such despair among the Greek people and, hence, resulted in the election of the ‘left populists’ (Kauder on SYRIZA) into power. If it is indeed the Greek elites who are responsible for the cataclysm in Greece, why is it that the Troika’s infamous memoranda since 2010 (the memoranda of understanding according to the wording of the IMF) literally spell out the policies that a country has to abide by, including the reduction of wages, pensions and social welfare? Mr. Kauder does not deny the truth, but reality itself. The interviewer, however, remained silent.

Mr. Kauder’s statements also constitute a covert attack upon the European Commission and upon Jean-Claude Juncker (this can also be found in the printed edition of Der Spiegel of last week). If Juncker, as is assumed by Der Spiegel, will question the regulations of the Stability Pact, why will he do so? Is it an attempt, as Der Spiegel suggests, to defy the German Chancellor’s leadership? Is there not a grain of truth in the idea that compliance with the Stability Pact amid a prolonged recession is simply absurd? Does the ‘truth commission’ of Der Spiegel really not understand that it is impossible to push for further ‘structural reforms’ given the extreme damages that these policies have already caused? The policies will lead to other leftist parties winning elections, which is something that Der Spiegel obviously does not favour.

A great example of German denial was provided by the former chief economist of the ECB, Jürgen Stark. In the FT (of February 11) he wrote: „The truth is that, in contrast to many eurozone countries, Germany has reliably pursued a prudent economic policy. While others were living beyond their means, Germany avoided excess. These are deep cultural differences and the currency union brings them to light once again.“ Along the same lines, the Süddeutsche Zeitung wrote a few days before: ‘It is often noted that Greek wages fell sharply because of the crisis. But the truth is that labour costs during the first ten years of the euro rose by nearly 20 per cent in Greece, while they decreased in Germany. Although Tsipras’s populism suggests otherwise, the Greeks brought most of their problems upon themselves.’ Mr. Stark and the Süddeutsche Zeitung do not have the luxury of a ‘truth commission’ as Der Spiegel does, but perhaps someone could raise questions about what is wrong with the 20 per cent labour cost increase and what is right about lowering labour costs? A 20 per cent wage increase in ten years time is not a problem in and of itself. There is nothing excessive or irresponsible devastating role in the European Monetary Union. The newly discovered love for what is euphemistically called ‘the truth’ in the German about this, given that wages increase in line with productivity plus the inflation target of 2 per cent set by the ECB.

The truth about all of this is that the inflationary use of the word truth in Germany comes on top of the complete denial of Germany’s media only serves to distract attention away from the manifest failure of German economic and financial policies and their devastating consequences. However, he media’s new love affair with ‘the truth’ does not fall out of the sky. Now that the left is in power in Greece, the myths about German innocence and Greek irresponsibility need to be intensified.



There is so much at play which is why it is so important to dig and understand, and I say this not for you, Warpy, but for those like me who are learning along the way. There is far more at play. There is a huge denial of truth and those guilty of that denial, are the same entities invoking hardship, poverty and inequality. There cannot be change, for the Eurozone to continue as they have been, this would mean Germany must give. So they staunchly refuse compromise, while not only Greece suffers, but all the other countries in that same Eurozone also suffer. It is at their hands, as the working class in their own country do not benefit from productivity, but continue on with wage stagnation - they are the no. 1 economy of the EZ. We need to understand that "beggar thy neighbor" makes beggars and slaves not only of the other countries, but eventually of the one guilty of it.

One might applaud Germany for its monetary gains, but where is the victory if its people stagnate, or trade itself stagnates? This is a game playing out and all the benefactors are the wealthiest of the wealthy, that elite l% who own all, where seemingly law is optional.

Of course, then I look to Varoufakis' vision of the EZ, it does not seek to crush its counterparts of the EZ, it seeks to unite and flourish with a dedication to bettering the working class, to ending austerity which only enriches oligarchs, it seeks to end the predatory approach to trade. How does anyone disagree with that vision? It is beyond me, but then, he is a person, not a corporation, only a man with conscience and principles has such vision.

This is class warfare and odious debt wreaking havoc, the same poison that's continues its reach globally.

The very issue of what is playing out is of global importance on all levels. As Greece is urged to reform, in reality the reform necessary is far greater, it is across the board, it is needed from all of the Eurozone countries and the Troika...so we wait and wonder how and when there will be realization of this truth, or will the Euro simply fail? If it does it won't be due to Syriza, it will be due to greed and insanity. At least, that's what I've learned along the way.
Posted by mother earth | Sun Jun 7, 2015, 02:07 PM (0 replies)

From Yanis Varoufakis, A Speech of Hope for Greece (6-7-15)

A Speech of Hope for Greece – a Project Syndicate Op-Ed

Posted on June 7, 2015 by yanisv

ATHENS – On September 6, 1946 US Secretary of State James F. Byrnes traveled to Stuttgart to deliver his historic “Speech of Hope.” Byrnes’ address marked America’s post-war change of heart vis-à-vis Germany and gave a fallen nation a chance to imagine recovery, growth, and a return to normalcy. Seven decades later, it is my country, Greece, that needs such a chance.
Until Byrnes’ “Speech of Hope,” the Allies were committed to converting “…Germany into a country primarily agricultural and pastoral in character.” That was the express intention of the Morgenthau Plan, devised by US Treasury Secretary Henry Morgenthau Jr. and co-signed by the United States and Britain two years earlier, in September 1944.

Indeed, when the US, the Soviet Union, and the United Kingdom signed the Potsdam Agreement in August 1945, they agreed on the “reduction or destruction of all civilian heavy-industry with war potential” and on “restructuring the German economy toward agriculture and light industry.” By 1946, the Allies had reduced Germany’s steel output to 75% of its pre-war level. Car production plummeted to around 10% of pre-war output. By the end of the decade, 706 industrial plants were destroyed.
Byrnes’ speech signaled to the German people a reversal of that punitive de-industrialization drive. Of course, Germany owes its post-war recovery and wealth to its people and their hard work, innovation, and devotion to a united, democratic Europe. But Germans could not have staged their magnificent post-war renaissance without the support signified by the “Speech of Hope.”
Prior to Byrnes’ speech, and for a while afterwards, America’s allies were not keen to restore hope to the defeated Germans. But once President Harry Truman’s administration decided to rehabilitate Germany, there was no turning back. Its rebirth was underway, facilitated by the Marshall Plan, the US-sponsored 1953 debt write-down, and by the infusion of migrant labor from Italy, Yugoslavia, and Greece.
Europe could not have united in peace and democracy without that sea change. Someone had to put aside moralistic objections and look dispassionately at a country locked in a set of circumstances that would only reproduce discord and fragmentation across the continent. The US, having emerged from the war as the only creditor country, did precisely that.
Today, it is my country that is locked in such circumstances and in need of hope. Moralistic objections to helping Greece abound, denying its people a shot at achieving their own renaissance. Greater austerity is being demanded from an economy that is on its knees, owing to the heftiest dose of austerity any country has ever had to endure in peacetime. No offer of debt relief. No plan for boosting investment. And certainly, as of yet, no “Speech of Hope” for this fallen people.

Posted by mother earth | Sun Jun 7, 2015, 12:54 PM (4 replies)

Varoufakis' Great Game - Yet another take on what's playing out & understanding all the moves...

The ECB bears considerable responsibility for this situation. By failing to produce the two-thirds majority in the ECB Council needed to limit the Greek central bank’s self-serving strategy, it has allowed the creation of more than €80 billion in emergency liquidity, which exceeds the Greek central bank’s €41 billion in recoverable assets. With Greece’s banks guaranteed the needed funds, the government has been spared from having to introduce capital controls.

Rumor has it that the ECB is poised to adjust its approach – and soon. It knows that its argument that the ELA loans are collateralized is wearing thin, given that, in many cases, the collateral has a rating below BBB-, thus falling short of investment grade.

If the ECB finally acknowledges that this will not do, and removes Greece’s liquidity safety net, the Greek government would be forced to start negotiating seriously, because waiting would no longer do it any good. But, with the stock of money sent abroad and held in cash having already ballooned to 79% of GDP, its position would remain very strong.

In other words, thanks largely to the ECB, the Greek government would be able to secure a far more favorable outcome – including increased financial assistance and reduced reform requirements – than it could have gained at any point in the past. And if Greece exits, a large share of the acquired resources measured by the TARGET balances and the cash that has been printed would turn into an endowment gift for an independent future.

Many people in Europe seem to believe that Varoufakis, an experienced game theorist but a political neophyte, does not know how to play the cards that Greece has been dealt. They should think again – before Greece walks away with the pot.

Read more at http://www.project-syndicate.org/commentary/varoufakis-ecb-grexit-threat-by-hans-werner-sinn-2015-05#mDwUI40I4pvdh3Ic.99
Posted by mother earth | Sun Jun 7, 2015, 12:51 PM (2 replies)

The Reoccurring Financial Woes of Greece Explained by Michael Hudson

Published on May 27, 2015

Michael Hudson says a leading economist in the IMF European Division resigned in anger and had written a number of reports that denounced the IMF as captured by private bond holders and speculators when former chief Dominique Strauss-Kahn was its head.

Hudson explains it all well.

Understand what's going on in Greece, the urgency of this situation is peaking, so much is at stake.
Posted by mother earth | Sun Jun 7, 2015, 12:28 PM (0 replies)

No Greece debt payment today: 3 things to know (June 5, 2015)

Debt-ridden Greece is not making a scheduled repayment on an IMF loan Friday. Three things to keep in mind about the apparent snub:

1.Greece is NOT in default . . .

The Friday payment was to be the first of four installments to be paid over the course of June. Greece says it will combine all of those payments into one and give the IMF that larger sum on June 30, the last day of the month. Rules followed by the IMF -- the Washington-based International Monetary Fund -- technically allow such a maneuver, if it's within the same month.
Friday's bill was for 300 million euros; the tab by month's end will be in the neighborhood of 1.6 billion euros -- or about $1.8 billion. More payments are due further down the road, coupled with the flow of more cash designed to help Greece attain financial stability.

2.. . . Yet

Greece sure did wait a while to tell not just the IMF, but also its partners across the European community and jittery investors around the world, of its plans. On Thursday, just a few hours before the government announced its end-of-the-month payment strategy, IMF chief Christine Lagarde told a a roomful of reporters she was "confident" the Friday payment was on track.
And lumping payments together is a practically unheard of option. The Independent of Britain cites the IMF as saying Zambia is the only country to invoke the rule in the past. That was in the early 1980s, the newspaper said -- and Zambia later defaulted.
Another snag: The IMF and other creditors, notably the European Central Bank and the European Commission, say Greece must cut back on services and raise taxes. Of this proposal, the deputy social security minister of Greece -- which has endured five years of austerity measures -- proclaims: "It will never pass."

3.The EU isn't enjoying this one little bit

The bailout brouhaha carries high stakes. In Greece, there's open talk of leaving the European community -- and ditching the euro -- rather than submit to demands of more austerity. A default could spell the end of ECB involvement in Greek banks, which could throw the Greek economy in a downward spiral.
As the administration of Prime Minister Alexis Tsipras sees it, the rest of Europe and the IMF have Greece under their collective thumb through harsh financing terms. Greek officials have complained that the overwhelming portion of aid coming into the country the past few years has gone to pay off loans owed to banks in countries such as France and Germany.

Tsipras assumed office in January after his radical-left Syriza party campaigned on an anti-bailout agenda. His finance minister, Yanis Varoufakis, is especially outspoken, saying in a documentary that aired in March that "clever people in Brussels, Frankfurt and Berlin" knew in 2010 that the bailout terms were too stringent and that Greece could never repay its loans.



Solidarity with Syriza! As goes Greece....soon....so goes the world. End austerity, end social and income inequality...never empower oligarchy. Stay tuned...
Posted by mother earth | Sat Jun 6, 2015, 08:48 AM (3 replies)

Greece, latest news...Clock Ticks as Greece Refuses to Kneel on its Debt

By: Tanya Talaga Global Economics Reporter, Published on Tue Jun 02 2015

To the dismay of its European creditors, Greece announced earlier this month that it was rehiring 4,000 cleaners, school support staff and civil servants who lost their jobs due to austerity cuts.

A defiant Greek Finance Minister Yanis Varoufakis defended the move, reminding lenders that perhaps the nation of 11 million has a different idea of what constitutes “reform.”

The rehiring was cheered in the streets of Athens but Europe was aghast. Greece did exactly the opposite of what the troika of lenders — the European Central Bank, the International Monetary Fund and the European Commission — wanted, namely real pension reform, reducing the size of government and spending cuts.

No doubt, Brussels felt the slap.

But they probably knew it was coming.




Helena Smith: Greece rumour mill in overdrive

Helena Smith
There is much chatter in Athens this morning that the country could hold elections if Greece isn’t given the “honourable compromise” that it wants, says our correspondent Helena Smith.

It is indicative of the mood in Athens this morning that even the mild-manned deputy premier Yannis Dragasakis has come out all guns. “As a government neither do we accept ultimatums not do we bow to blackmail,” tweeted the ex communist who is now in charge of the anti-austerity coalition’s economic policy.

If an honourable compromise isn’t reached “then we’ll have elections,” the labour minister, Panos Skourletis, told SKAI TV. “When you are elected you are not given carte blanche,” he said, adding:
“If a deal is achieved that is not deemed honourable and promoting of compromise, the people will have to be asked before we sign it.”
Nikos Filis, the governing Syriza party’s representative in parliament, also insisted this morning that in the event of an agreement not being endorsed by government MPS (but being voted through with the help of the opposition) the country would necessarily have to go to the polls.

The great Greek rumour mill is suggesting that fresh polls could be held on June 28. It should be noted that prime minister Alexis Tsipras’ radical left Syriza party is by far the most popular party - and would almost certainly win an elections hands down. Europe or indeed the IMF would not be dealing with a new face in power!

Plenty more at the Guardian link.

Posted by mother earth | Tue Jun 2, 2015, 06:40 PM (1 replies)
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