Imagine if activists and elected officials were clamoring for emergency provision of food and McDonald’s offered to place a drive-thru window in every post office. Calling it #postalfood. That makes as much sense as JPMorgan’s Chase recent attempt to place its own ATMs in every post office and call it #postalbanking. According to recent reports, Chase — the largest bank in the United States, with $3.2 trillion of assets — has offered to lease space from USPS in exchange for the “exclusive right” to solicit postal banking customers. Wall Street has consistently opposed the return of postal banking since its destruction in the 1960s. Chase and other nefarious actors are attempting to prevent competition before it even forms. The 2020 Democratic Party Platform and Biden-Sanders Unity Task Force recommendations both call for postal banking. But they also call on policymakers to separate retail banking institutions from more risky investments and protect consumers from high rates, onerous fees, inequitable credit reporting, and other harms.Continue reading
Exxon Booted From Dow As Oil And Gas Falls
Spending 92 years doing anything is an accomplishment, so let’s cheers to Exxon Mobil Corp., which spent more than nine decades as a member of the Dow Jones Industrial Average, pillaging the planet, lying about climate change, and making rich people even richer.
Now, those days have come to an end. One of the biggest oil companies on Earth has hemorrhaged money this year, and now it’s been booted from the Dow Jones because it just isn’t the superpower it once was. I almost feel bad for Big Oil these days. Almost.
The news of Exxon’s removal from the Dow Jones comes amid a pandemic that has absolutely crushed oil.Continue reading
US Firms Shield CEO Pay As Pandemic Hits Workers, Investors
New York/ Boston – Sonic Automotive Inc (SAH.N), which operates 95 U.S. car dealerships, started laying off and furloughing about a third of its workforce as the coronavirus pandemic crushed its sales. Then it changed its executives’ pay packages – handing them a multimillion-dollar windfall.
On April 10, Sonic’s board gave its top executives stock options to replace performance-based share awards, regulatory filings show. The options it gave Chief Executive David Smith, whose family controls the company, are now worth about $5.16 million – more than four times the value of the performance-based stock awards he got last year.
Some of Sonic’s terminated employees, meanwhile, face hard times.Continue reading
The Disconnect Between The Stock Market And The Real Economy Is Destroying Our Lives
In the month of April—as 30 million Americans filed for unemployment, and destitute small businesses closed forever, and rent strikes were demanded, and city and state governments forecast years of grim austerity—the U.S. stock market had its best month in more than 30 years. Day after day, we were treated to stories of absolute ruin in the real economy, right next to another glorious rise in stocks. After a sharp selloff in March, the S&P 500 index has bounced back to where it was in the fall of 2019, as if that little devastating global pandemic were nothing more than a fleeting, momentary annoyance.
The glaring disconnect between the real economy, of working humans with jobs and bills to pay, and the investor class economy, embodied by the stock market, is one of the most brutal and devious political issues of this age of crisis in which we’re living.Continue reading
The Myth Of V-Shape Economic Recovery
The spin is in! Trump administration economic ‘message bearers’, Steve Mnuchin, US Treasury Secretary, and Kevin Hasset, senior economic adviser to Trump, this past Sunday on the Washington TV talking heads circuit launched a coordinated effort to calm the growing public concern that the current economic contraction may be as bad (or worse) than the great depression of the 1930s.
Various big bank research departments predicting a GDP contraction in the first quarter (January-March 2020) anywhere from -4% to -7.5%, and for the current second quarter, a further contraction from -30% to -40%: Morgan Stanley investment bank says 30%. The bond market investment behemoth, PIMCO, estimates a 30% fall in GDP. Even Congress’s Budget Office recently estimate the contraction in GDP could be as high as -40% in the 2nd quarter.Continue reading
Why The Oil And Gas Industry Will Never Be The Same
When a staple commodity collapses to negative value it signals that something is clearly amiss in the global economy. When it is a global energy source like crude oil, it does not just signal pain in the oil patch, but an economic dislocation evocative of the Great Depression. Rare is the time when a commodity over which nations have fought wars in the past presents itself as something that traders would literally pay you to take it off their collective hands.
To be sure, there are good technical reasons why U.S. West Texas Intermediate crude oil (WTI), the underlying commodity representing the NYMEX’s oil futures contract, actually traded negative in the second half of April, and continued to stay low (even though the June contract has now turned positive).Continue reading
An All-American Urge To Offer Corporate Welfare
To say that these are unprecedented times would be the understatement of the century. Even as the United States became the latest target of Hurricane COVID-19, in “hot spots” around the globe a continuing frenzy of health concerns represented yet another drop down the economic rabbit hole.
Stay-at-home orders have engulfed the planet, encompassing a majority of Americans, all of India, the United Kingdom, and much of Europe. A second round of cases may be starting to surface in China. Meanwhile, small- and medium-sized businesses, not to speak of giant corporate entities, are already facing severe financial pain.
I was in New York City on 9/11 and for the weeks that followed. At first, there was a sense of overriding panic about the possibility of more attacks, while the air was still thick with smoke.Continue reading
Not This Time: Watch Out For Wall Street In A Pandemic
We have entered uncertain times. The novel coronavirus has upended life around the globe, and none of us knows exactly how long the outbreak or its ramifications will last. But daily reminders of how much we can’t control shouldn’t stop us from seizing upon those things we can.Continue reading
Twenty-First Century Neoliberalism Is Failing – Where Do We Go From Here?
Stock markets around the world have become very volatile over the past few weeks with record losses. We are in a global recession, which could become a depression in the United States. Panic over the coronavirus and falling oil prices triggered the crisis, but economists have predicted this for some time due to high levels of corporate debt and artificial propping up of Wall Street. It was just a question of when. We speak with economist Jack Rasmus, author of “The Scourge of Neoliberalism: US Economic Policy from Reagan to Trump,” about the current state of the economy and what we can expect from here. Rasmus posits that twenty-first-century neoliberalism is doomed to be highly unstable with rapid crashes and long recovery times. The system is going to change, but the direction it takes depends on what people do to demand a system that puts people before profits.Continue reading
We’re In A Recession, And It’s Likely To Get Worse
The coronavirus epidemic is creating an ongoing teachable moment that could be used to transform the US economy. COVID-19 and the oil war are triggers leading to a recession that has its roots in record corporate and personal debt, longterm low wages and an artificially-inflated stockmarket. The shortcomings of US economic policy, the healthcare system, and workers’ rights are being magnified by the current crisis.
Epidemiologists are reporting the coronavirus epidemic will last months, maybe more than a year. A survey of prominent academic economists released on Thursday found that a majority believe even if the outbreak proves to be limited, like the flu, it is likely to cause a “major recession.”Continue reading
Hoodwinked: How Wall Street And Big Real Estate Turned Anti-Discrimination Policies Against Blacks
In 1970, Janice Johnson, a Black single mother in Philadelphia, was facing eviction from an old apartment building condemned by the city. She was desperately seeking a place for her and her 8-year-old son to live, and her attempts to rent nearby apartments were coming up short.Continue reading
Climate Movement Takes Aim At Wall Street, Because ‘Money Is Only Language Fossil Fuel Industry Speaks’
Organized by a coalition of climate, youth, and Indigenous groups, Stop the Money Pipeline will officially launch Friday at the final event in a weekly civil disobedience series that actor and activist Jane Fonda kicked off in October called Fire Drill Fridays. Several vocal climate campaigners plan to join Fonda at the Friday launch, including celebrities Martin Sheen and Joaquin Phoenix, Indigenous leaders Tara Houska and Eriel Deranger, Greenpeace USA executive director Annie Leonard, and authors and activists Naomi Klein and Bill McKibben.Continue reading
The People vs Wall Street: California’s Public Banking Shakeup
For only the second time in 100 years, a people-powered coalition overcame the stiff opposition of the banking lobby to successfully pass a law that legalizes public banking. Governor Gavin Newsom (D-CA) signed a bill into law last month allowing California cities and towns to establish public banks.
It was almost a century ago that a similar grassroots uprising in North Dakota overcame the clout of big finance to establish the state-run Bank of North Dakota. And the passage of the California law may reverberate across the country.
“We finally have the option of reinvesting our public tax dollars in our communities instead of rewarding Wall Street’s bad behavior,” AB 857 sponsor and California Assembly member David Chiu (D-San Francisco) told the Los Angeles Times.Continue reading
How A Public Bank Could Free S.F.’s Money From Wall Street
Of all the vivid characters in Hustlers, from Jennifer Lopez’s magnetic Ramona to Cardi B portraying her own lived experience, the 2008 financial crash is the one that will be familiar to most contemporary Americans. In the movie, the Great Recession spurs a crew of New York strippers into making a living by drugging rich-looking men to spend lavishly at clubs as their own twisted way of surviving in a system that doesn’t protect people like them. “We got to start thinking like these Wall Street guys. You see what they did to this country?Continue reading
Central Banks Bailing Out Wall Street And Big Finance As Crash Looms
Two actions by US financial authorities this week indicate that the United States will respond to a looming downturn in the global economy by providing, once again, unlimited amounts of cash to financial markets. On Wednesday, the Federal Reserve began an operation, lasting at least six months, to purchase around $60 billion of Treasury bills a month in response to sharp spikes in interest rates in overnight markets. The following day, in a separate action, the New York Federal Reserve injected $104.15 billion into financial markets to boost liquidity.Continue reading