Credit Suisse study shows inequality accelerating, with NGOs saying it shows economic recovery ‘skewed towards wealthy’. ● The richest 1% of the world’s population are getting wealthier, owning more than 48% of global wealth, according to a report published on Tuesday which warned growing inequality could be a trigger for recession. According to the Credit Suisse global wealth report (pdf), a person needs just $3,650 – including the value of equity in their home – to be among the wealthiest half of world citizens. However, more than $77,000 is required to be a member of the top 10% of global wealth holders, and $798,000 to belong to the top 1%. “Taken together, the bottom half of the global population own less than 1% of total wealth. In sharp contrast, the richest decile hold 87% of the world’s wealth, and the top percentile alone account for 48.2% of global assets,” said the annual report, now in its fifth year. The report, which calculates that total global wealth has grown to a new record – $263tn, more than twice the $117tn calculated for 2000 – found that the UK was the only country in the G7 to have recorded rising inequality in the 21st century.
The treaty has now been ratified by presidents of Russia, Belarus and Kazakhstan. ● Kazakhstan’s President Nursultan Nazarbayev signed a law on Tuesday on ratifying the treaty on the Eurasian Economic Union, a Russia-led three-member bloc seen as an alternative to the EU. “The head of state has signed the law of the Republic of Kazakhstan “On ratification of the Eurasian Economic Union Treaty,” the presidential press service said in a statement. The text of the law is to be published in local newspapers, the statement reads. Russia ratified the treaty on October 3. Nearly a week later, on October 9, the law on ratifying the treaty was adopted by the Belarusian parliament. On the same day, the document was signed by the country’s President Alexander Lukashenko. The Eurasian Economic Union Treaty was signed by the presidents of Russia, Kazakhstan and Belarus on May 29, 2014. The treaty provides for free movement of commodity, services, capital and labor force within the union. It also envisages that the three countries coordinate or pursue common policy in certain economic sectors.
Nick Beams ■ The annual International Monetary Fund (IMF) and World Bank meetings concluded in Washington over the weekend in the midst of a deepening economic and financial crisis, with no prospect of a recovery in the world economy. The euro zone seems set to enter its third recession since the global financial crisis erupted in 2008, and there are fears that the policies being pursued by the world’s major central banks are creating the conditions for another crash.
xymphora ■ "Exclusive: Privately, Saudis tell oil market- get used to lower prices" This is bluff (perhaps a manic phase of Prince Bandar's mental illness). The Saudis can't afford to do this - they need big revenues to fund their own social programs or face the revolution they fear, and they certainly don't benefit by wrecking OPEC. It may just be a warning to the Americans to get with the Saudi plan for Syria (the Americans need the high oil price numbers to keep the fracking illusion going, an illusion that creates the phony economic numbers that keep up the deception that the US isn't in severe economic difficulties), a plan which at least the Pentagon seems to be resisting (the Pentagon has been choosing bombing targets which appear to be helping the Syrian government).
Saudi Arabia is quietly telling oil market participants that Riyadh is comfortable with markedly lower oil prices for an extended period, a sharp shift in policy that may be aimed at slowing the expansion of rival producers including those in the U.S. shale patch. ● Some OPEC members including Venezuela are clamoring for urgent production cuts to push global oil prices back up above $100 a barrel. But Saudi officials have telegraphed a different message in private meetings with oil market investors and analysts recently: the kingdom, OPEC’s largest producer, is ready to accept oil prices below $90 per barrel, and perhaps down to $80, for as long as a year or two, according to people who have been briefed on the recent conversations.
Auf Drängen der USA hat Saudi-Arabien seine Öl-Produktion massiv ausgeweitet. Dies hat entscheidend dazu beigetragen, dass der Ölpreis seit Juni um rund 20 Prozent eingebrochen ist. Der Preisverfall schadet vor allem Russland, das den Großteil seiner Staatseinnahmen aus dem Export von Öl und Gas bezieht. Sollte Saudi-Arabien den Öl-Krieg fortsetzen, droht Putin erstmals ein deutliches Staatsdefizit. ● Saudi-Arabien hat seine Ölproduktion zuletzt massiv erhöht und dadurch zu dem Verfall des Ölpreises um rund 20 Prozent beigetragen. Grund dafür ist offenbar eine strategische Zusammenarbeit mit den USA, die Russland durch einen Ölkrieg in die Knie zwingen wollen. [...] Saudi-Arabien wird den Ölpreis drücken, um politischen Druck auf den Iran und Russland auszuüben, zitiert die türkische Nachrichtenagentur Anadolu den Präsidenten des Zentrums für Saudi-arabische Ölpolitik und Strategische Aussichten, Rashid Abanmy.
Anadolu Agency: Saudi Arabia to pressure Russia, Iran with price of oil
Iran and Russia plan to establish a joint bank as an effort to multiply bilateral trade and bypass sanctions on the Islamic Republic’s banking sector. ● Head of the Iran-Russia Joint Chamber of Commerce Asadollah Asgaroladi said that Tehran and Moscow are studying the possibilities of opening a new chapter in trade relations that could break the domination of Western currencies over bilateral exchanges. “Since Russian banks fear the implications of working with Iran due to sanctions, we want to establish the joint Iran-Russia bank with the help of our central banks and private sectors,” Asgaroladi said. “Such a bank would be able to exchange money between the two sides using rials and rubles and put aside dollars, euros and pounds,” he added. Unilateral sanctions imposed on Iran’s banking sector by the US and the European Union over Tehran’s nuclear energy program and the recent Western bans against Russia over Ukraine have prompted the two countries’ trade officials to boost economic cooperation.
In terms of purchasing power, China now has the largest economy on the entire planet, but that is not the only area where China has surpassed the United States. China also accounts for more total global trade than the U.S. does, China consumes more energy than the U.S. does, and China now manufactures more goods than the U.S. does. In other words, the era of American economic dominance is rapidly ending. Global economic power is making a dramatic shift to the east, and that is going to have huge implications for our future. We already owe the Chinese well over a trillion dollars, and as our economic infrastructure crumbles we are feverishly borrowing even more money in a desperate attempt to prop up our falling standard of living. We can’t seem to match the work ethic, inventiveness and determination of China and other Asian nations and it is showing. If we continue down this path, what will the future look like for future generations of Americans?
Nick Beams ■ IMF report records global economic breakdown
Sahra Wagenknecht von der Links-Partei geht mit der extrem an die USA angebundenen deutschen Außenpolitik hart ins Gericht: Merkel und Steinmeier hätten einen Wirtschaftskrieg gegen Russland mitgetragen, der vor allem der europäischen und deutschen Wirtschaft schadet. Sie fordert das sofortige Ende der Sanktionen gegen Russland, das Ende der Unterstützung einer Regierung in Kiew, in der bis heute Faschisten sitzen, und eine restlose Aufklärung des Abschusses von Flug MH17.
The International Monetary Fund says China has overtaken the United States as the world’s largest economy, according to a report. ● The IMF estimates that the size of the US economy is $17.4 trillion, while the Chinese economy comes in at $17.6 trillion, Business Insider reports. China’s share of the global economy is 16.48 percent, while the United States accounts for 16.28 percent, the IMF said Tuesday as part of its outlook for the world economic growth. These figures are adjusted for the relative costs of living in both countries, known as "purchasing power parity." As recently as 2005, the Chinese economy was less than half the size of the US economy. Moreover, the IMF projects that China’s economy will be 20 percent bigger than that of the US by 2019.
Business Insider: China Just Overtook The US As The World's Largest Economy
Speech of the US Vice President Joe Biden can backfire on Washington, as it embarrasses the European Union members and demonstrates the US has intimidated them, Paul Craig Roberts, former Assistant Secretary of the Treasury, believes.
One of the possible consequences is that his speech embarrasses European governments by showing that Europe is Washington's vassal," Roberts told RIA Novosti on Friday. "The other is that by pressing Europeans to act against their own interests, Washington might have been too much of a bully and hurt its future influence in Europe."
US Vice President said Thursday that the United States and US President Barack Obama, in particular, had forced the European Union members to "take economic hits to impose cost" on Russia.
PressTV: Biden’s remarks on Syria about allies are ‘disingenuous’: Scott Rickard || “With Joe Biden, the vice president of the United States, claiming that the US is some sort of victim to their allies with Saudi Arabia, Qatar, UAE, Turkey, Jordan, Israel and others that are directly involved in this international crime against Syria over the past four years, is really disingenuous. It is unbelievable how terribly wrong and [this is] completely – I would say completely -- criminal of Joe Biden to try to exonerate the United States,” Rickard said. “
But in fact he is very much aware that the United States has been directly involved both financially and clandestine through operations with the CIA, and French and British intelligence, as well as Turkish and Jordanian intelligence and Saudi intelligence,” he added.
The wealthiest 400 people in the United States had their combined net worth grow thirteen percent to $2.29 trillion this year, amidst a surging stock market and record corporate profits. The figures come from the Forbes 400 list of the wealthiest Americans, compiled every year since 1982 by the American business magazine of the same name. As Forbes noted last week, the net worth of these 400 individuals is “about the same as the gross domestic product of Brazil, a country of 200 million people.” The average net worth of the Forbes 400 hit $5.7 billion, up by $700 million over the past year. The new figures of wealth in America were generally buried in the media.
Carl Herman ■ Consensus among leading organizations is that ending poverty would require an investment from developed nations of just 0.7% of their GNI (gross national income), with a total 10-year cost of between $1 trillion and $3 trillion. Current US wars since 9/11 have a long-term cost now between $4 trillion and $6 trillion. This means that the US alone could have ended global poverty just since 9/11 for half the cost for their wars (also for perspective, 11 days of ongoing war cost would pay all tuition for US public college students). The .01% hide $21 trillion to $32 trillion in offshore tax havens, with the top seven US banks hiding over $10 trillion. These hidden hoards would end poverty on ~10 to 42 Earths.
Paul Craig Roberts ■ Poverty Report Contradicts GDP Claims || Washington has been conducting needless wars abroad for 93 percent of the 21st century at a cost of trillions of dollars. More trillions have been wasted bailing out banks that deregulation permitted to become “too big to fail.” During the past seven years, millions of Americans have lost their jobs and their homes, and food stamp rolls have reached record numbers. These hurting Americans have been ignored by policy-makers in Washington. Clearly, government in America is focused on something different from a healthy economy and the well being of citizens. We call it democracy, but it’s not.
Daniel Patrick Welch/PressTV: US is not a democracy, but a ‘firmly entrenched oligarchy’
Washington Post: The middle class is poorer today than it was in 1989
In a word association game, If I said Switzerland, you might say cheese or chocolate or maybe the alps. ● But another common item everyone associates with the Swiss is their money. Their banks. Their currency. Soon, that currency could change in a big way. This November, a Swiss Gold Referendum is going to a vote, and the repercussions, one way or the other, could cast a shadow of uncertainty on the US dollar. Nearly one-third of the Swiss Franc used to be guaranteed by gold reserves, not it’s less than 8 percent. If this vote goes through, the Swiss will be forced to raise the gold reserve back up to 20 percent. ● Joining us today is radio host Charles Goyette. He and Congressman Ron Paul have talked about central banks at great length on his radio show. Today, we’d like to get HIS input on the Swiss Gold Referendum. [Hat Tip: The People's Voice]
Norway is the best country in which to grow old, according to new research – while Britain does not make it into the top ten. ● It is a country famed for its long dark winter nights and high cost of living – but Norway should also, thanks to a new survey, be recognised as the best place in which to grow old. Its citizens benefit from decades-old policies designed to provide financial security in old age, plus an efficient public transport system, a strong sense of security and a high level of employment among senior citizens. “
It’s a combination of good management of natural resources coupled with planning ahead,” said Gustavo Toshiaki, an economist and global ageing specialist based in Norway. “
They have identified the issues and are dealing with them.” Research from HelpAge International, released on Wednesday to coincide with the UN International Day of Older Persons, showed that Norway had the highest global level of well-being for people over 60. The London-based charity created its second annual index of 96 countries, and ranked countries on economic security, health, access to public transport and societal inclusion. Sweden, Switzerland, Canada and Germany completed the top five – while Britain was 11th. The UK performed well in the social environment category, being ranked third overall. But it was positioned only 23rd for education and employment – behind Bolivia, Estonia and the Philippines. Britain also performed badly in the health category, placed at 27th – two places behind the US. Japan was the best country for elderly health care, while Costa Rica, Chile, Greece and Colombia also performed better than the UK. Of all the nations in the index, Afghanistan ranked last – and the bottom ten countries were all in Sub-Saharan Africa or the Middle East.
The real reason Russia and Syria are being targeted right now. || Contrary to popular belief, the conduct of nations on the international stage is almost never driven by moral considerations, but rather by a shadowy cocktail of money and geopolitics. As such, when you see the mouthpieces of the ruling class begin to demonize a foreign country, the first question in your mind should always be "what is actually at stake here?"
● For some time now Russia, China, Iran, and Syria have been in the cross hairs. Once you understand why, the events unfolding in the world right now will make much more sense. The U.S. dollar is a unique currency. In fact its current design and its relationship to geopolitics is unlike any other in history. Though it has been the world reserve currency since 1944, this is not what makes it unique. Many currencies have held the reserve status off and on over the centuries, but what makes the dollar unique is the fact that since the early 1970s it has been, with a few notable exceptions, the only currency used to buy and sell oil on the global market.
● Prior to 1971 the U.S. dollar was bound to the gold standard, at least officially. According to the IMF, by 1966, foreign central banks held $14 billion U.S. dollars, however the United States had only $3.2 billion in gold allocated to cover foreign holdings. Translation: the Federal Reserve was printing more money than it could actually back. The result was rampant inflation and a general flight from the dollar.
● In 1971 in what later came to be called the "Nixon Shock" President Nixon removed the dollar from the gold standard completely. At this point the dollar became a pure debt based currency. With debt based currencies money is literally loaned into existence. Approximately 70% of the money in circulation is created by ordinary banks which are allowed to loan out more than they actually have in their accounts. The rest is created by the Federal Reserve which loans money that they don't have, mostly to government. Kind of like writing hot checks, except it's legal, for banks. This practice which is referred to as fractional reserve banking is supposedly regulated by the Federal Reserve, an institution which just happens to be owned and controlled by a conglomerate of banks, and no agency or branch of government regulates the Federal Reserve.
The sharp rise in income inequality across the world is one of the most worrying developments of the past 200 years, the Organisation for Economic Co-operation and Development (OECD), said on Thursday. ● In a flagship report tracking wellbeing in eight world regions over two centuries, the OECD noted that personal incomes had diverged in the last 30 years as GDP (gross domestic product) per head had risen. "It is hard not to notice the sharp increase in income inequality experienced by the vast majority of countries from the 1980s. There are very few exceptions to this," said OECD economists in the report. Income inequality, as measured by pre-tax household income across individuals within a country, declined in most Western countries from the end of the 19th century until about 1970, when it began to rise.
The Treaty on the establishment of the Eurasian Economic Union was signed by the presidents of Russia, Belarus and Kazakhstan on May 29, 2014 in Astana. ● The Federation Council, the upper house of Russia’s parliament, unanimously ratified the Treaty on the Eurasian Economic Union (EEU) on Wednesday. The Treaty on the establishment of the Eurasian Economic Union was signed by the presidents of Russia, Belarus and Kazakhstan on May 29, 2014 in Astana. The agreement is the basic document defining the accords between Russia, Belarus and Kazakhstan for creating the EEU for the free movement of goods, services, capital and workforce and conducting coordinated, agreed or common policies in key sectors of the economy, such as energy, industry, agriculture and transport. The agreement stipulates the transition of Russia, Belarus and Kazakhstan to the next stage of integration after the Customs Union and the common economic space. [...] A separate part of the agreement formulates the principles of forming the union’s budget, which will be made up of ruble contributions by the member states. The size of the contributions will be determined by the Higher Council. The Treaty on the Eurasian Economic Union stipulates customs and technical regulation, foreign trade policies and measures to protect the internal market. The agreement envisages the transition to common customs tariffs. The agreement also stipulates the principles of coordinated macro-economic and foreign exchange policies, financial market regulation, interaction in the energy and transport sectors, the development of a common gas, oil, petroleum product, medicines and medical equipment market.
Senior European and European Central Bank (ECB) officials agreed to threaten Ireland with national bankruptcy if the government made any attempt to burn bondholders, the Sunday Independent can reveal. ● The threat was made at a high-level teleconference meeting, details of which have been revealed for the first time by the Central Bank governor, Dr Patrick Honohan. Mr Honohan, who famously told the nation Ireland would be entering the Troika bailout programme live on radio as government ministers were publicly denying it, also revealed he was kept out of loop about the meeting.In a new book about the late Brian Lenihan, Mr Honohan said he only found out about the meeting after the Troika delivered the ultimatum to Mr Lenihan on November 26, 2010.
Tyler Durden ■ When we first covered the Carmen Segarra lawsuit alleging the capture of the NY Fed by Goldman Sachs back in October 2013, we didn't have much hope for justice to get done. We said that "while her allegations may be non-definitive, and her wrongful termination suit is ultimately dropped, there is hope this opens up an inquiry into the close relationship between Goldman and the NY Fed. Alas, since the judicial branch is also under the control of the two abovementioned entities, we very much doubt it." ■ Sure enough, the lawsuit was dropped (and no inquiry was opened) but not before it became clear that the very judge in charge of the case, U.S. District Judge Ronnie Abrams, was herself conflicted, after it was revealed that her husband, Greg Andres, a partner at Davis Polk & Wardwell, was representing Goldman in an advisory capacity. Curiously, before she assumed her current office in March 2013, back in 2008 Abrams returned to Davis Polk herself as Special Counsel for Pro Bono. She had previously worked at the firm from 1994 to 1998. For the full, and quite amazing, story of how the "Judge" steamrolled Segarra's objections reads this Reuters piece. ■ As a result of this fiasco, some wondered just how far do Goldman's tentacles stretch not only at the money-printing (i.e., NY Fed) level, not only at the legislative level (see "With Cantor Down, Which Other Politicians Has Goldman Invested In?"), but at the judicial as well.
Tyler Durden ■ I don't want to spoil the revelations of "This American Life": It's far better to hear the actual sounds on the radio, as so much of the meaning of the piece is in the tones of the voices -- and, especially, in the breathtaking wussiness of the people at the Fed charged with regulating Goldman Sachs. But once you have listened to it -- as when you were faced with the newly unignorable truth of what actually happened to that NFL running back's fiancee in that elevator -- consider the following:
1. You sort of knew that the regulators were more or less controlled by the banks. Now you know.
2. The only reason you know is that one woman, Carmen Segarra, has been brave enough to fight the system. She has paid a great price to inform us all of the obvious. She has lost her job, undermined her career, and will no doubt also endure a lifetime of lawsuits and slander.
So what are you going to do about it? At this moment the Fed is probably telling itself that, like the financial crisis, this, too, will blow over. It shouldn't.
The Mistral-class helicopter carrier Vladivostok, carrying the first crew of some 200 Russian sailors, has finished a series of tests early Monday morning. ● The Vladivistok set off from the French port of Saint-Nazaire for sea trials on September 13, and is scheduled to go to sea again on Tuesday with its second crew on board, according to a RIA Novosti source. The $1.2 billion contract for the manufacture of the Mistral-class ships between French ship builder DCNS and Russia's state-run arms trade intermediary Rosoboronexport was signed in June 2011. The first carrier, the Vladivostok is to be deployed by the Russian Navy in 2014, while the second ship, the Sevastopol, will arrive in 2015.
The European Parliament called on the European Union on Thursday to consider cutting Russia off the SWIFT inter-bank financial message system. ● The European Union will not cut Russia off the SWIFT inter-bank financial system, Andrei Kostin, the chief executive officer VTB Group, Russia's second largest bank, said on Friday. "I think this is not going to happen. I would have called it an act of direct aggression against Russia's financial system with all subsequent consequences. This is a very tough measure," Kostin said at an international investment forum in Sochi.
Bill Van Auken ■ ["Never letting a good crisis go to waste:"] The Obama administration and the Pentagon have announced the “surge” of 3,000 US troops into West Africa, ostensibly in response to the escalating spread of the Ebola virus in the region. The militarized response to the deadly epidemic has underscored Washington’s increasingly heavy reliance on its residual military superiority in what has become a second “scramble for Africa,” pitting the US against China in a struggle for control of the continent’s markets and resources.
Andre Damon ■ Forty-five million people are living in poverty in the United States, according to figures released Tuesday by the Census Bureau. The 2013 Income and Poverty in the United States report found that the number of people in poverty remained at a record high last year, while the income of a typical household remained stagnant. According to the Census figures, the median household income in the US has fallen 8 percent since 2007. The continuing prevalence of mass poverty and the stagnation of the incomes of working people are an expression of the fact that the so-called economic “recovery” touted by the Obama administration is a recovery only for the financial elite: corporate profits hit a record in the year covered by the report, while stock values increased by a third that year, fueled by the Federal Reserve’s money printing operations. The White House praised the report, saying that it showed that “key indicators of poverty and family income improved.” In reality, the report is yet another confirmation of the fact that there has been no real improvement in the living conditions of working people.