30 June, 2009. This column and its readers have been sadly neglected to meet the demands of other peoples’ agendas. I can only apologise.

For it is other peoples’ agendas that preoccupies me today. There have been many important meetings held this year, in which groups of people have come together to collectively develop ‘grand narratives.’ on the theme of the financial crisis.  These, it is hoped, will help galvanise an apparently mesmerised population into action against those in finance, politics and the world of academic economics - that have helped wreak ruin, bankruptcies, home repossessions, large-scale fraud and unemployment on society.

But most of these grand narratives are characterised by ignorance of the nature of bank money, and credit, and as a result both mis-diagnose the causes of the crisis, and mis-analyse solutions….

This is because most assume that credit = savings, and that only by mobilising savings or surpluses (generated by production of one sort or another) is it possible for banks or financial institutions to lend money to finance economic activity.  In other words, that money (deposits/savings/credit) exists only as the result of economic activity; and those deposits/savings/credit then create economic activity.

On the contrary: it is bank money/credit that creates economic activity - and only then are deposits, surpluses and savings generated.  And not the other way around.

Read post »

by John Vandaele, translation by Evelien Van Muylem.

In Brussels this last week as the guest of MO*  - an international affairs magazine.  This is an article they wrote for the website/magazine on the green New Deal.

‘Time for a Green New Deal XXL’

19 juni 2009 (MO) - In April, world leaders from the G-20 countries met in London. Trade unions, non-governmental and international organizations hoped they would consider Green New Deal XXL: a radical reform of the global system which also tackles economic, social and environmental problems.

Read post »

De Standaard:  Brussels 18th June, 2009.

Interview:Ann Pettifor over de ‘Green New Deal’ — BRUSSEL -
De westerse overheden moeten dringend de hand aan de ploeg slaan en de almacht van de financiële sector inperken. Dat vindt Ann Pettifor, econome en activiste.

Van onze redacteur

Weg met de banken, leve de overheid. Als je het gedachtegoed van Ann Pettifor in zeven woorden zou moeten samenvatten, zou het ongeveer zo klinken. Pettifor is het meest bekend als drijvende kracht achter Jubilee 2000, de campagne om de schulden van de ontwikkelingslanden grotendeels kwijt te schelden. Een campagne die een succesvolle apotheose kreeg toen de G8 in 1999 besloot om 100 miljard dollar van deze schulden af te schrijven. Nu werkt Pettifor, die al in 2003 in het boek ‘The Credit Crunch’ waarschuwde voor de komende kredietcrisis , voor de Londense denktank New Economics Foundation. Die heeft het rapport ‘AGreen New Deal’ uitgegeven. De titel verwijst naar de New Deal waarmee president Roosevelt de crisis van de jaren30 aanpakte. De daadkracht en voortvarendheid van toen is nu schrijnend afwezig, vindt ze. Pettifor was deze week op uitnodiging van het tijdschrift Mo* in Brussel om haar plan toe te lichten, en erover in debat te gaan met VBO-voorzitter Thomas Leysen

Read post »

I have been travelling again, this time to visit my frail and elderly mother in South Africa. I was there for President Zuma’s first ‘State of the Union’ Address, and will write more about the country of my birth in the next post. In the meantime wanted to add this piece - on economic optimism in the US - written last week for the Huff Post, with apologies for the delay in adding it to the site.

9th June 2009.

“As a banker noted recently, there is no constituency for pessimism. Americans, he suggested, believe in optimism as a human right. This bright buoyancy is one of this nation’s greatest strengths, lapped up by jaded Europeans.

But it was optimism that also enabled Americans to max out on credit cards and other forms of borrowing — in the mistaken belief that debts are always payable — sometime in the future.

Read post »

Ann Pettifor - 11th June 2009 - For the Guardian Online.

http://www.guardian.co.uk/commentisfree/2009/jun/12/recession-economic-crisis

A banker, Alan Clarke of BNP Paribas, citing a NIESR report, confidently tells the Guardian that the recession is over. Should we take the word of any banker – especially one that claims to be an economist – seriously?

Given that the economics profession was blind-sided by the ‘debtonation’ of 9th August, 2007, I am deeply sceptical. Second, given that this is a banker-induced recession; that reckless and often fraudulent behaviour by bankers led to a loss of $60 trillion of yours and my wealth (in the form of pensions, equities, lost interest on savings, and lost income from job losses) last year, should we believe a banker’s particular spin on the crisis?

Read post »

27 May 2009 Apologies for the long absence. Have travelled to spread the word to - amongst other places - Berlin and Edinburgh. Not that it was enjoyable. Am distinctly uncomfortable about flying these days. Primarily because of climate change, but also because travel can be very unpleasant. Reading of British Airways’ results, reminds me why.

Gradually both plane and train operators expanded their business or first class departments and squeezed their economy passengers. As a result both airline and train travel economy class have become almost unbearable. Thankfully I am short, but how do those taller than 5.3″ survive in those cramped, claustrophobic cabins? The fact is that we, economy class passengers, were treated with contempt by both airline and train operators. More and more space was handed over to a minority -  the rich and privileged.

Read post »

Ann Pettifor - 12th May 2009

Have just returned from a flying visit to Iceland, where I was mightily impressed by the warmth and strength of the Icelandic character. Also struck by the pride Icelanders have in the way the financial crisis deepened and strengthened their democracy – leading to the ousting of a corrupt government, and the election of a progressive coalition.

Read post »

May 8, 2009

You can watch Ann’s speech on the Green New Deal at the new Crunch Time website. Crunch time is the first major conference of progressive Australian think tanks, covering topics including the economy, democracy, climate change, poverty, social inclusion and much more.

Ann Pettifor. Huffington Post. May 2nd, 2009

In my last post, I argued that the United States is now a bank-owned state. As if to prove my point, the banks used their power over 12 Democratic members of the Senate to defeat Senator Durbin’s “Helping Families Save Their Homes in Bankruptcy” amendment. And they financed the lobbying of taxpayer representatives with some of the billions of bail-out dollars provided by - taxpayers.

This was a defeat for American democracy. It represented a failure of senators to represent their constituents, honor the constitution and ‘establish justice, insure domestic tranquility and promote the general welfare of the American people. But while it was a defeat for democracy, it was a Pyrrhic victory for the bankers. One more such victory over Congress and the White House, and the bankers will be facing ruin.

Read post »

It seems that Deutsche Bank do care about reputational damage. Yesterday, Josef Ackerman, head of the Bank had his contract renewed for another three years, in order to avoid the ‘reputational damage’ of an open recruitment process.

Speaking to the Financial Times Ackerman said: “In these tough times we didn’t want any more reputational damage (to candidates) through speculation…..Let’s say that if it were one person (who becomes CEO) another would be unhappy. That would be something we didn’t want to make into an issue during a financial crisis” Mr. Ackerman said.

By that rationale, we should have company dictatorships and government dictatorships. After all, if one party say, were to be elected, that would make another unhappy. And at times of crisis, we would not want that, would we?

Oh, and by the way, Deutshce Bank’s results in the quarter in which they hammered a small Russian micro-finance organisation ‘beat expectations’. “Pre-tax return on equity was 25 per cent” the bank said, meeting its pre-crisis target, and flouting the condemnation of Bishop Huber.  “Good fixed-income trading in its corporate and investment bank division saw net revenues rise to €4.9bn compared with €1.5bn in the first quarter of 2008.”