Tuesday, August 21, 2012

Free Economic Inquiry Under Attack Worldwide

Freedom of speech regarding debt, economics and national solvency is under international assault. 

Here's a great overview of the situation in Europe. If you recall, independent ratings agencies (like Fitch) evaluate the quality of debt. Using that rating, central banks, insurance companies, pensions and other organizations make investment decisions based on that rating. These agencies, using tried and true methods, are downgrading debt (there's too much of it and not enough growth, making payback less likely) and this is upsetting people. 

For example, Italian police raided the office of a rating agency that downgraded Italian on a minor pretext (that story is in article link above).

The European Central Bank is also contemplating rating the quality of its own debt and is making noises about limiting the ability of others to comment on the bank's solvency.

In America, Egan Jones (a mid-sized rating firm) was lowered its ratings on American debt.  Immediately following this downgrade, the SEC coincidentally(?) started a harsh investigation of Egan Jones based on a minor technicality and threatened to revoke its ability to issue ratings on government debt.

Not government debt per se, but on the subject of free commentary on economics:

In Argentina, the government has threatened to exorbitantly fine economists who question official inflation numbers.

Read the articles and decide what this means for yourself.

Tuesday, August 7, 2012

Book Review: Other People's Money

Louis Brandeis's Other People's Money and How the Bankers Use It is a classic critique of the power Wall Street and financiers can wield.

The populist lawyer and later Supreme Court justice often critiqued and identified concentrated power as harmful to democracy.

In Other People's Money, Brandeis lays out his argument against the banks and Wall Street.

Brandeis claims that a small number of bankers use the people's own money deposits as the basis to control industry and finance. This power is then used to create non-competitive oligarchies that stifle creativity, competition and thus lower prices. In addition, many businesses run by financiers are not run as operational businesses producing goods and services, but more as cash cows to be mined, stripped and then discarded.

As evidence, Brandeis examines the connections of shell and dummy corporations, together with massive amounts of capital stock, that allow a small number of people to control so much wealth and direct activity.

His solution is creating financial institutions and marketplaces controlled by the people - credit unions and cooperatives.

While presenting one perspective to be sure, Other People's Money will be a much needed re-introduction to America's sometimes sordid financial past.

Friday, August 3, 2012

Analysis Reports in Passport GMID and Marketline Advantage

We previously discussed industry reports available in our databases.

But there's also analysis of situations, demographic economic behavior, and reactions to economic developments.

Located in Passport GMID.and Marketline Advantage. You'd select out analysis instead of industry reports.

Here are some examples of typical reports: