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Ellen Brown is an attorney, founder of the Public Banking Institute, and author of twelve books including the best-selling WEB OF DEBT. In THE PUBLIC BANK SOLUTION, her latest book, she explores successful public banking models historically and globally. Her websites are http://EllenBrown.com, http://PublicBankSolution.com, and http://PublicBankingInstitute.org.
Saturday, February 21, 2015(14 comments)
Swimming with the Sharks: Goldman Sachs, Schools, and Capital Appreciation Bonds
Remember when Goldman Sachs -- dubbed by Matt Taibbi the Vampire Squid-- sold derivatives to Greece so the government could conceal its debt, then bet against that debt, driving it up? It seems that the ubiquitous investment bank has also put the squeeze on California and its school districts.
Wednesday, February 11, 2015(24 comments)
Why Public Banks Outperform Private Banks: Unfair Competition or a Better Mousetrap?
Public banks in North Dakota, Germany and Switzerland have been shown to outperform their private counterparts. Under the TPP and TTIP, however, publicly-owned banks on both sides of the oceans might wind up getting sued for unfair competition because they have advantages not available to private banks.
Wednesday, January 7, 2015(13 comments)
EU Showdown: Greece Takes on the Vampire Squid
Greece and the troika (the International Monetary Fund, the EU, and the European Central Bank) are in a dangerous game of chicken. The Greeks have been threatened with a "Cyprus-Style prolonged bank holiday" if they "vote wrong." But they have been bullied for too long and are saying "no more."
Saturday, December 20, 2014(18 comments)
Russian Roulette: Taxpayers Could Be on the Hook for Trillions in Oil Derivatives
The sudden dramatic collapse in the price of oil appears to be an act of geopolitical warfare against Russia. The result could be trillions of dollars in oil derivative losses; and the FDIC could be liable, following repeal of key portions of the Dodd-Frank Act last weekend. Whatever happened behind closed doors, we the people could again be stuck with the tab.
Saturday, December 13, 2014(7 comments)
The Global Bankers' Coup: Bail-In and the Shadowy Financial Stability Board
On December 11,the US House passed a bill repealing the Dodd-Frank requirement that risky derivatives be pushed into big-bank subsidiaries, leaving our deposits and pensions exposed to massive derivatives losses. The recent drop in the price of oil could trigger a derivatives payout that could bankrupt the biggest banks. And if the G20's new "bail-in" rules are formalized, depositors and pensioners could be on the hook.
Tuesday, December 2, 2014(27 comments)
New G20 Rules: Cyprus-style Bail-ins to Hit Depositors AND Pensioners
On the weekend of November 16th, the G20 leaders whisked into Brisbane and whisked out again. It was all so fast, they may not have known what they were endorsing when they rubber-stamped the Financial Stability Board's latest dictat, which completely changes the rules of banking. Not only public and private depositors' funds, but also pension funds--via "bail-inable bonds"--are now targeted for confiscation.
Thursday, November 20, 2014(13 comments)
WSJ Reports: Bank of North Dakota Outperforms Wall Street
While 49 state treasuries were submerged in red ink after the 2008 financial crash, one state's bank outperformed all others and actually launched an economy-shifting new industry. So reports the Wall Street Journal this week, discussing the Bank of North Dakota (BND) and its striking success in the midst of a national financial collapse led by the major banks.
Monday, October 27, 2014(13 comments)
Why Do Banks Want Our Deposits? Hint: It's Not to Make Loans.
Many authorities have said it: banks do not lend their deposits. They create the money they lend on their books. Which leaves us to wonder: If banks do not lend their depositors' money, why are they always scrambling to get it? Banks advertise to attract depositors, and they pay interest on the funds. What good are our deposits to the bank?
Monday, October 13, 2014(9 comments)
Building an Ark: How to Protect Public Revenues from the Next Meltdown
Concerns are growing that we are heading for another banking crisis, one that could be far worse than in 2008. But this time, there will be no government bailouts. Instead, per the Dodd-Frank Act, bankrupt banks will be confiscating (or "bailing in") their customers' deposits.
That includes local government deposits. The fact that public funds are secured with collateral may not protect them, as explained earlier here.
Wednesday, September 17, 2014(3 comments)
A Public Bank Option for Scotland
Scottish voters will go to the polls on September 18th to decide whether Scotland should become an independent country. A publicly-owned bank could help Scotland take control of its own economic destiny, by avoiding unnecessary debt to a private banking system that has become a burden to the economy rather than a pillar in its support.
Tuesday, September 9, 2014(29 comments)
Preparing To Asset-strip Local Government? The Fed's Bizarre New Rules
In an inscrutable move that has alarmed state treasurers, the Federal Reserve just changed the liquidity requirements for the nation's largest banks. Municipal bonds have been eliminated from the list of high-quality liquid collateral. That means banks that are the largest holders of munis are liable to start dumping them in favor of the Treasuries and corporate bonds that do satisfy the requirement.
Tuesday, September 2, 2014(6 comments)
Even the Council on Foreign Relations Is Saying It: Time to Rain Money on Main Street
You can always count on Americans to do the right thing, after they've tried everything else. --Winston Churchill
When an article appears in Foreign Affairs, the mouthpiece of the policy-setting Council on Foreign Relations, recommending that the Federal Reserve do a money drop directly on the 99%, you know the central bank must be down to its last bullet.
Wednesday, August 27, 2014(8 comments)
Colonization by Bankruptcy: The High-stakes Chess Match for Argentina
Argentina is playing hardball with the vulture funds, which have been trying to force it into an involuntary bankruptcy. The vultures are demanding what amounts to a 600% return on bonds bought for pennies on the dollar, defeating a 2005 settlement in which 92% of creditors agreed to accept a 70% haircut on their bonds. A US court has backed the vulture funds; but last week, Argentina sidestepped its jurisdiction . . .
Thursday, August 14, 2014(10 comments)
Cry for Argentina: Fiscal Mismanagement, Odious Debt or Pillage?
Argentina has now taken the US to The Hague for blocking the country's 2005 settlement with the bulk of its creditors. The issue underscores the need for an international mechanism for nations to go bankrupt. Better yet would be a sustainable global monetary scheme that avoids the need for sovereign bankruptcy.
Sunday, July 27, 2014(36 comments)
You Can't Taper a Ponzi Scheme: Time to Reboot
As Max Keiser observes, "You can't taper a Ponzi scheme." You can only turn off the tap and let it collapse, or watch the parasite consume its food source and perish of its own accord.
The question being hotly debated in the blogosphere is, "What then?" Will economies collapse globally? Will life as we know it be a thing of the past?
Thursday, July 17, 2014(15 comments)
Did the Other Shoe Just Drop? Big Banks Hit with Monster $250 Billion Lawsuit in Housing Crisis
For years, homeowners have been battling Wall Street in an attempt to recover some portion of their massive losses from the housing Ponzi scheme. But progress has been slow. Now the banks may have met their match. Investors led by BlackRock, the world's largest asset manager, and PIMCO, the world's largest bond-fund manager, have sued some of the world's largest banks for breach of fiduciary duty.
Saturday, June 21, 2014(30 comments)
Buying Up the Planet: Out-of-control Central Banks on a Corporate Buying Spree
When the US Federal Reserve bought an 80% stake in American International Group in September 2008, the unprecedented $85 billion outlay was justified as necessary to bail out the world's largest insurance company. Today, however, central banks are on a global corporate buying spree not to bail out bankrupt corporations but simply as an investment, to compensate for the loss of bond income due to record-low interest rates.
Monday, June 9, 2014(7 comments)
California's Top-Two Primary Eliminates Third-Party Rivals
The money is with the 1%, but the vote count is with the 99%. We can prevail, if we can get that great mass of disillusioned voters into the voting booths. And that is just the sort of game-changing event that Top Two is calculated to prevent.
Monday, May 19, 2014(15 comments)
Are Public Banks Unconstitutional? No. Are Private Banks? Maybe.
The movement to break away from Wall Street and form publicly-owned banks continues to gain momentum. But enthusiasts are deterred by claims that a state-owned bank would violate constitutional prohibitions against "lending the credit of the state."
Thursday, April 24, 2014(37 comments)
Wall Street Greed: Not Too Big for a California Jury
United States Attorney General Eric Holder has declared that the too-big-to-fail Wall Street banks are too big to prosecute. But an outraged California jury might have different ideas. . . The question is how to get Wall Street banks before a California jury. How about charging them with common law fraud and breach of contract? That's what the FDIC just did in its civil suit for damages for LIBOR manipulation . . .
Monday, April 14, 2014(11 comments)
The Global Banking Game Is Rigged, and the FDIC Is Suing
Taxpayers are paying billions of dollars for a swindle pulled off by the world's biggest banks, using a form of derivative called interest-rate swaps; and the Federal Deposit Insurance Corporation has now joined a chorus of litigants suing over it. . . It is not just that local governments, universities and pension funds made a bad bet on these swaps. The game itself was rigged, as explained below.
Sunday, March 30, 2014(5 comments)
Bankers Win Both Ways: Now They Can Take Both Taxpayer and Depositor Money
On March 20, 2014, European Union officials reached an historic agreement to create a single agency to handle failing banks. Media attention has focused on the agreement involving the single resolution mechanism (SRM), a uniform system for closing failed banks. But the real story for taxpayers and depositors is the heightened threat to their pocketbooks of a deal that now authorizes both bailouts and "bail-ins."
Friday, March 14, 2014(12 comments)
Warren's Post Office Proposal: Palast Aims at the Wrong Target
Investigative reporter Greg Palast is usually pretty good at peering behind the rhetoric and seeing what is really going on. But in tearing into Senator Elizabeth Warren's support of postal financial services, he has done a serious disservice to the underdogs -- both the underbanked and the US Postal Service itself.
Tuesday, March 4, 2014(4 comments)
The Stone that Brings Down Goliath? Richmond and Eminent Domain
Richmond, California, has gone where no city dared go before, threatening to take underwater mortgages by eminent domain and renegotiate them on behalf of beleaguered homeowners. Grassroots efforts to pursue eminent domain are also underway in a number of other cities around the country. If Richmond pulls it off successfully, others will rush to follow. The result s could be costly for some very large banks.
Saturday, February 15, 2014(10 comments)
Usurious Returns on Phantom Money: The Credit Card Gravy Train
The credit card business is now the most lucrative part of the banking industry, and it's not just from the interest. It's the hidden fees. Even when the balance is paid on time every month, credit card use imposes a huge hidden cost on users--hidden because the cost is deducted from what the merchant receives, then passed on to you in the form of higher prices. Public banks could return the profits to the people.
Friday, January 31, 2014(18 comments)
Enough Is Enough: Banksters Are Not Our Only Option
Mega-banks might be too big to fail. According to U.S. Attorney General Eric Holder, they might even be too big to prosecute. But they are not too big to abandon as depositories for government funds.
Thursday, January 16, 2014(19 comments)
California Dreamin': Why I Am Running for State Treasurer
I am running for California State Treasurer on a state bank platform, along with Laura Wells, who is running for Controller. We are throwing our bonnets in the ring for the opportunity to show the Governor or his successor that a state-owned bank can be our ticket to returning California to the abundance it once enjoyed.
Monday, December 23, 2013(15 comments)
100 Years Is Enough: Time to Make the Fed a Public Utility
December 23rd, 2013, marks the 100th anniversary of the Federal Reserve, warranting a review of its performance. Has it achieved the purposes for which it was designed?
The answer depends on whose purposes we are talking about. For the banks, the Fed has served quite well. For the laboring masses whose populist movement prompted it, not much has changed in a century.
Sunday, December 8, 2013(2 comments)
Amend the Fed: We Need a Central Bank that Serves Main Street
The Federal Reserve Act was drafted by bankers to create a banker's bank that would serve their interests. It is their own private club, and its legal structure keeps all non-members out. A century after the Fed's creation, a sober look at its history leads to the conclusion that it is a privately controlled institution whose corporate owners use it to direct our entire economy for their own ends.
Wednesday, November 27, 2013(15 comments)
Monsanto, the TPP, and Global Food Dominance
Global food control has nearly been achieved, by reducing seed diversity with GMO (genetically modified) seeds that are distributed by only a few transnational corporations. But this agenda has been implemented at grave cost to our health; and if the Trans-Pacific Partnership (TPP) passes, control over not just our food but our health, our environment and our financial system will be in the hands of transnational corporations.
Tuesday, November 12, 2013(3 comments)
Public Banking in Costa Rica: A Remarkable Little-known Model
In Costa Rica, publicly-owned banks have been available for so long and work so well that people take for granted that any country that knows how to run an economy has a public banking option. Costa Ricans are amazed to hear there is only one public depository bank in the United States (the Bank of North Dakota), and few people have private access to it.
Monday, November 4, 2013(10 comments)
Ireland: Ground Zero for the Austerity-driven Asset Grab
The Irish have a long history of being tyrannized, exploited, and oppressed. Today, Ireland is under a different sort of tyranny, one imposed by the banks and the troika--the EU, ECB and IMF. The oppressors have demanded austerity and more austerity, forcing the public to pick up the tab for bills incurred by profligate private bankers.
Tuesday, September 24, 2013(13 comments)
What We Could Do with a Postal Savings Bank: Infrastructure that Doesn't Cost Taxpayers a Dime
The Postal Service Modernization Bills brought by Peter DeFazio and Bernie Sanders would allow the post office to recapitalize itself by diversifying its range of services to meet unmet public needs. Needs that the post office might diversify into include (1) funding the rebuilding of our crumbling national infrastructure; (2) servicing the massive market of the "unbanked" and "underbanked" who lack access
Wednesday, September 18, 2013(10 comments)
The Armageddon Looting Machine: The Looming Mass Destruction from Derivatives
Increased regulation and low interest rates are driving lending from the regulated commercial banking system into the unregulated shadow banking system. The shadow banks are propped up by a hidden government guarantee in the form of safe harbor status under the 2005 Bankruptcy Reform Act. The result is to create perverse incentives for the financial system to self-destruct.
Tuesday, August 27, 2013(10 comments)
The Leveraged Buyout of America
Giant bank holding companies now own airports, toll roads, and ports; control power plants; and store and hoard vast quantities of commodities of all sorts. They are systematically buying up or gaining control of the essential lifelines of the economy. How have they pulled this off, and where have they gotten the money?
Tuesday, August 20, 2013(28 comments)
Not Too Big to Jail: Why Eliot Spitzer Is Wall Street's Worst Nightmare
If we the people are to take back our power from Wall Street and the corporatocracy. We need a mass movement, coordinated action, and leaders who can organize it. Eliot Spitzer is one of the few people in a position to play that role who have the experience, vision and courage to carry it through.
Wednesday, July 31, 2013(2 comments)
Green Light for City-owned San Francisco Bank
The question today is whether cities and counties can afford not to set up their own municipal banks, both to protect their money from confiscation and to take advantage of the very low interest rates and other perks available exclusively to the banking club.
Wednesday, July 24, 2013(3 comments)
Collateral Damage: QE3 and the Shadow Banking System
Rather than expanding the money supply, quantitative easing (QE) has actually caused it to shrink by sucking up the collateral needed by the shadow banking system to create credit. The "failure" of QE has prompted the Bank for International Settlements to urge the Fed to shirk its mandate to pursue full employment, but the sort of QE that could fulfill that mandate has not yet been tried.
Saturday, July 6, 2013(10 comments)
Think Your Money is Safe in an Insured Bank Account? Think Again.
The EU can mandate that governments arrange for deposit insurance, but if funding is inadequate to cover a systemic collapse, taxpayers will again be on the hook; and if they are unwilling or unable to cover the losses (as occurred in Cyprus and Iceland), we're back to the unprotected deposits and routine bank failures and bank runs of the 19th century.
Saturday, June 29, 2013(2 comments)
The Crime of Alleviating Poverty -- A Local Community Currency Battles the Central Bank of Kenya
Former Peace Corps volunteer Will Ruddick and several residents of Bangladesh, Kenya, face a potential seven years in prison after developing a cost-effective way to alleviate poverty in Africa's poorest slums. Their solution: a complementary currency issued and backed by the local community. The Central Bank of Kenya has now initiated charges of forgery.
Saturday, June 15, 2013(29 comments)
Elizabeth Warren's QE for Students: Populist Demagoguery or Economic Breakthrough?
On July 1, interest rates will double for millions of students -- from 3.4% to 6.8% -- unless Congress acts; and the legislative fixes on the table are largely just compromises. Only one proposal promises real relief -- Sen. Elizabeth Warren's "Bank on Students Loan Fairness Act." This bill has been dismissed out of hand as "shameless populist demagoguery" and "a cheap political gimmick," but is it?
Tuesday, April 30, 2013(9 comments)
Bail-out Is Out, Bail-in Is In: Time for Some Publicly-owned Banks
The crossing of the Rubicon into the confiscation of depositor funds was not a one-off emergency measure limited to Cyprus. Similar "bail-in" policies are now appearing in multiple countries. What triggered the new rules may have been a series of game-changing events including the refusal of Iceland to bail out its banks and their depositors
Wednesday, April 10, 2013(7 comments)
Winner Takes All: The Super-priority Status of Derivatives
Cyprus-style confiscation of depositor funds has been called the "new normal." Bail-in policies are appearing in multiple countries directing failing TBTF banks to convert the funds of "unsecured creditors" into capital, including depositors. Even state and local governments deposits may be at risk. Derivatives have "super-priority" status in bankruptcy,and Dodd Frank precludes further taxpayer bailouts.
Friday, March 29, 2013(18 comments)
It Can Happen Here: The Confiscation Scheme Planned for US and UK Depositors
The government's debt is at least arguably the people's debt, since the government is there to provide services for the people. But when the banks get into trouble with their derivative schemes, they are not serving depositors, who are not getting a cut of the profits. Taking depositor funds is simply theft.
Saturday, March 23, 2013(30 comments)
The Battle of Cyprus: The Long-planned Deposit Confiscation Scheme
On Tuesday, March 19, the national legislature of Cyprus overwhelmingly rejected a proposed levy on bank deposits as a condition for a European bailout. Reuters called it "a stunning setback for the 17-nation currency bloc," but it was a stunning victory for democracy. As Reuters quoted one 65-year-old pensioner, "The voice of the people was heard."
Monday, February 25, 2013(20 comments)
How the Fed Could Fix the Economy--and Why It Hasn't
Quantitative easing (QE) is supposed to stimulate the economy by adding money to the money supply, increasing demand. But so far, it hasn't been working. Why not? Because as practiced for the last two decades, QE does not actually increase the circulating money supply. It merely cleans up the toxic balance sheets of banks.
Thursday, February 14, 2013(12 comments)
How Congress Could Fix Its Budget Woes Permanently
As Congress struggles through one budget crisis after another, it is becoming increasingly evident that austerity doesn't work. We cannot possibly pay off a $16 trillion debt by tightening our belts, slashing public services, and raising taxes
Saturday, January 19, 2013(40 comments)
The Trillion Dollar Coin: Joke or Game Changer?
Most commentators have missed the real significance of the trillion dollar coin. It is not just about political gamesmanship. For centuries, a secret battle has raged over who should create the nation's money supply. Today, all that is left of the US Treasury's money-creating power is the ability to mint coins.
Thursday, December 20, 2012(32 comments)
Fiscal Cliff: Time to Call Their Bluff
The self-induced austerity crisis is a diversion from the real crises, including unemployment, the housing crisis, a bloated military, and unrepayable debt. Slashing services, selling off public assets, and raising taxes won't cure these ills. To maintain a sustainable and productive economy requires a visionary leap into the new. A new economy needs new methods of public financing.
Saturday, December 8, 2012(13 comments)
Exploring the Public Bank Option for Scotland
The Royal Bank of Scotland (RBS) and the Bank of Scotland have been pillars of Scotland's economy and culture for over three centuries. So when the RBS was nationalized by the London-based UK government following the 2008 banking crisis, and the Bank of Scotland was acquired by the London-based Lloyds Bank, it came as a shock to the Scots. They no longer owned their oldest and most venerable banks.
Friday, November 9, 2012(40 comments)
It's the Interest, Stupid! Why Bankers Rule the World
In the 2012 edition of Occupy Money released last week, Professor Margrit Kennedy writes that a stunning 35% to 40% of everything we buy goes to interest. This interest goes to bankers, financiers, and bondholders, who take a 35% to 40% cut of our GDP. That helps explain how wealth is systematically transferred from Main Street to Wall Street.
Thursday, October 4, 2012(12 comments)
QE Infinity: What's It All About, Mr. Bernanke?
QE3, the Federal Reserve's third round of quantitative easing, is so open-ended that it is being called QE Infinity. Doubts about its effectiveness are surfacing even on Wall Street.