Economy The US and European Economic crisis

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There is such a thing as the Net Capital Ratio Rule whereby banks or traders must hold x amount of capital and can lend 15 times that much i.e. they can lend 15x. The old rule was 7x. Then ex-US Treasury Secretary Henry Paulson when he was Chairman of Goldman Sachs had the Net Capital Rule changed to 33X i.e. twice the existing 15x. With President George W. Bush "Home Ownership" program in a bid to pump up the economy and low interest rate enabled banks to lend around $53 trillion in derivatives and mortgages. The bad mortgages were peddled to the international market and the crash of mortgages bankrupted Lehman Brothers and others. Finally US Treasury Secretary Hank Paulson stepped in to help Wall Street. After the US elections the Federal Reserve put in $2 trillion in the "cash reserves" of the other private banks to bring the Net Capital Ratio back to 15x. During George W. Bush the National Debt was $9 trillion. By President Obama's time the National debt became $15 trillion. The combined bailouts and public money into the cash reserves of private banks prevented a global Depression but it brought about the Great Recession worldwide.

http://en.wikipedia.org/wiki/Net_capital_rule

There is an economist Michael Hudson who elaborates on the transformation of a production economy to an interest paying economy controlled by the banks.

Views

On parasitic financing

Hudson states finance has been key to guiding politics into reducing the productive capacity of the U.S. and Europe, even as the U.S. and Europe benefit from finance methods using similar and expanded techniques to harm Chile, Russia, Latvia, and Hungary.[7] He states parasitic finance looks at industry and labor to determine how much wealth it can extract by fees, interest, and tax breaks, rather than providing needed capital to increase production and efficiency. He states the "magic of compounding interest" results in increasing debt that eventually extracts more wealth than production and labor are able to pay. Rather than extracting taxes from the "rentiers" to reduce the cost of labor and assets and use the tax revenue to improve infrastructure to increase production efficiency, he states the U.S. tax system, bank bailouts, and quantitative easing sacrifice labor and industry for the benefit of the finance sector.
He states the Washington Consensus has encouraged the IMF and world bank to impose austerity that the U.S. itself is not exposed to (thanks to dollar dominance) which leads to 1) subjecting other countries to unfair trade that depletes natural resources and 2) privatizing infrastructure that is sold at distressed prices that uses parasitic finance techniques (including western-style tax breaks) to extract the maximum amount of the country's surplus rather than providing a price-competitive service.
On the banking crisis

Hudson states that the mortgage crisis was caused by parasitic finance that used law and outright fraud, and that the government backing of toxic debt and quantitative easing are ways to keep real estate inflated while the banks shift the real losses to U.S. labor, taxpayers, and the international community. Hudson states "quantitative easing" and "restoring stability" are euphemisms for the U.S. finance sector using the Federal Reserve and dollar dominance to engage in financial aggression to a degree that previously required military conquest.[2] He points out Joseph Stiglitz has similar views. He states banks should have been allowed to fail with the government stepping in to protect savings and continue with qualified loans towards real productive capacity rather than financial loans that merely inflate asset prices. He states the Federal Reserve needs to understand inflating asset prices with low interest rates does not increase the long term productive capacity of the economy.
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http://en.wikipedia.org/wiki/Michael_Hudson_(economist)

The myth that Germany’s hyperinflation in the 1920s was caused by the Reichsbank using the printing press to finance Germany’s domestic budget deficit has survived to justify the Lisbon Treaty’s preventing the European Central Bank from creating money to lend to governments. Banks have spent a generation planting this false history to force governments to borrow commercially, at interest, presumably on risk-free terms. The ECB thus has been hijacked to serve commercial banks, not the public interest. Banks want to force governments to borrow commercially, at interest, presumably on risk-free terms. The aim is to monopolize the creation of money that governments could create just as well on their own computer keyboards.
Already in the 18th century, British economists such as Sir James Steuart, Rev. Josiah Tucker and even David Hume recognized that additional money and spending normally (as long as unemployment existed) helped increase output more than prices. The corollary is that monetary deflation in unemployment conditions tends to curtail output more than imports – not to speak of transferring property from creditors via foreclosure. So money is much more than a “veil.” It is debt, not merely a set of “counters.” Austerity discourages new capital investment, leading to deeper import dependency, worsening the balance of payments as well as the fiscal deficit.
By starving the economy of the funds to increase employment and output – while backing banks that have spent the past generation inflating real estate prices and the financial bubble – ECB policy has promoted asset price inflation for housing, living costs and hence employment costs. This hardly is a recommendation for leaving it with the central planning power it is seeking to impose austerity to squeeze out debt payments for its past irresponsible credit policy.
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http://michael-hudson.com/2012/08/financial-predators-v-labor-industry-and-democracy/

http://michael-hudson.com/2012/08/fireside-on-the-great-theft/

Today’s post-industrial strategy of “wealth creation” is to use debt leveraging to bid up asset prices. From corporate raiders to arbitrageurs and computerized trading programs, this “casino capitalist” strategy works as long as asset prices rise at a faster rate than the interest that has to be paid. But it contains the seeds of its own destruction, because it builds up financial claims on the assets pledged as collateral – without creating new means of production. Instead of steering credit into tangible capital formation, banks find it easier to make money by lending to real estate and monopolies (and to other financial institutions). Their plan is to capitalize land rent, natural resource rent and monopoly privileges into loans, stocks and bonds.
This leads the banks to act as lobbyist for their rentier clients, to free them from taxes so that they will have more available to pay interest. The resulting tax shift onto labor and industry adds a fiscal burden to the debt overhead.
This is not a natural and even inevitable form of evolution. It is a detour from the kind of economy and indeed free market that classical writers sought to create. With roots in the 13th-century Schoolmen discussing Just Price, the labor theory of value was refined as a tool to isolate economic rent as that element of price that had no counterpart in actual or necessary costs of production. Banking charges, monopoly rent and land rent were the three types of economic rent analyzed in this long classical tradition. These rentier charges were seen as unnecessary and exploitative special privileges carried over from the military conquests that shaped medieval Europe. A free market was defined as one free of such overhead charges.
This classical view of free markets as being free of an unearned “free lunch” was embodied in the Progressive Era’s financial and tax reforms. But the rentiers have fought back. The financial sector seeks to justify today’s deepening indebtedness on the ground that it “creates wealth” by debt leveraging. Yet the banks’ product is a debt overhead, leaving debt deflation in its wake as debtors try to pay debts that can’t be paid without drastically reducing consumption and investment. A shrinking economy falls further into arrears in a debt spiral.
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http://michael-hudson.com/2012/08/overview-the-bubble-and-beyond/
 
[h=3]Michael Hudson on Fictitious Capital[/h]Michael Hudson spoke with Max Keiser about what he calls “fictitious capital” which is essentially lending backed by inadequate capital, such as collateral that has fallen in value. This is an idea he has explored in his previous papers, such as “From Marx to Goldman Sachs” and now in his new book, The Bubble and Beyond. For German readers, Hudson was also interviewed in FAZ.

Read more at http://www.nakedcapitalism.com/2012...ictitious-collateral.html#7Fqk4mrToiT2H60E.99

http://www.nakedcapitalism.com/2012/08/michael-hudson-on-fictitious-collateral.html
 
One wonders how could this all happen? The goldsmiths used to keep their customers’ gold as merchants didn't want to carry so much gold around on their person so the cheque was invented. The goldsmiths realized that only a portion of the value of their customers' gold holdings was involved so they took advantage of that and lent out more money. They realized they could lend seven times the value of the gold in their "banks" or basements. When the loans were repaid they collected seven times the value of the customers’ gold plus the interest and service charges. That is how the wealth of the goldsmiths-turned-bankers grew. They increased the "Net Capital Ratio" to 15 so their "capital" grew even more. They made all that money from their customers' gold. So one can see how the bankers took over the economy. The interest was declared as "income" while the repaid loans were not but as recapitalization. This largesse was spread into hedge funds managed by their close associates or ethnic group. Money was provided for their group to start businesses or to take over businesses. Money was also provided to educate their ethnic group.
 
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[TABLE="class: MsoNormalTable, width: 452"]
[TR]
[TD="width: 41"] [FONT=&quot] [/FONT]
[/TD]
[TD="width: 131"] [FONT=&quot] [/FONT]
[/TD]
[TD="width: 103"] [FONT=&quot]Net Capital Rule[/FONT]
[/TD]
[TD="width: 139"] [FONT=&quot] [/FONT]
[/TD]
[TD="width: 51"] [FONT=&quot] [/FONT]
[/TD]
[TD="width: 139"] [FONT=&quot] [/FONT]
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]Years[/FONT]​
[/TD]
[TD]
[FONT=&quot] Principal [/FONT]​
[/TD]
[TD]
[FONT=&quot]Ratio[/FONT]​
[/TD]
[TD]
[FONT=&quot] Loans [/FONT]​
[/TD]
[TD]
[FONT=&quot]Interest[/FONT]​
[/TD]
[TD]
[FONT=&quot] 100 % return [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot] [/FONT]​
[/TD]
[TD]
[FONT=&quot] [/FONT]​
[/TD]
[TD]
[FONT=&quot] [/FONT]​
[/TD]
[TD]
[FONT=&quot] [/FONT]​
[/TD]
[TD]
[FONT=&quot] [/FONT]​
[/TD]
[TD]
[FONT=&quot] [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]0[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 1,000.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 15,000.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 15,300.00 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]5[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 15,300.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 229,500.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 234,090.00 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]10[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 234,090.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 3,511,350.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 3,581,577.00 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 3,581,577.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 53,723,655.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 54,798,128.10 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]20[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 54,798,128.10 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 821,971,921.50 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 838,411,359.93 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]25[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 838,411,359.93 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 12,576,170,398.95 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 12,827,693,806.93 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]30[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 12,827,693,806.93 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 192,415,407,103.94 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 196,263,715,246.01 [/FONT]​
[/TD]
[/TR]
[TR]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[/TR]
[TR]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot]Bad loans = 25%[/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[/TR]
[TR]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD]
[FONT=&quot] Principal @ 75% [/FONT]​
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD]
[FONT=&quot] 75% return [/FONT]​
[/TD]
[/TR]
[TR]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD]
[FONT=&quot] [/FONT]​
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD] [FONT=&quot] [/FONT]
[/TD]
[TD]
[FONT=&quot] [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]0[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 1,000.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 15,000.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 11,475.00 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]5[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 11,475.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 172,125.00 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 175,567.50 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]10[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 175,567.50 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 2,633,512.50 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 2,686,182.75 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 2,686,182.75 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 40,292,741.25 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 41,098,596.08 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]20[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 41,098,596.08 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 616,478,941.13 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 628,808,519.95 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]25[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 628,808,519.95 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 9,432,127,799.21 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 9,620,770,355.20 [/FONT]​
[/TD]
[/TR]
[TR]
[TD]
[FONT=&quot]30[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 9,620,770,355.20 [/FONT]​
[/TD]
[TD]
[FONT=&quot]15[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 144,311,555,327.95 [/FONT]​
[/TD]
[TD]
[FONT=&quot]2%[/FONT]​
[/TD]
[TD]
[FONT=&quot] $ 147,197,786,434.51 [/FONT]​
[/TD]
[/TR]
[/TABLE]


The above tables shows how a bank with “Net Capital Ratio” of 15 i.e.

assets (cash = investors’ money) : liabilities (loans = depositors’ money). There are three scenarios:

1. For a bank - 1:15 e.g. $1,000 of investors’ cash used as reserve to lend out $15,000 (depositors’ money) to businesses or for mortgages.

2. For a brokerage - Loans could also be from banks if it is a brokerage which operates like a bank for stocks and bonds.

3. For a bank - $1,000 (depositers’ money) : $15,000 (loans = fiat money or created out of nothing that the goldsmiths did)

If the loans are 5-year loans @ 2% annual rate then in 30 years, the bank’s capital can theoretically grow to $12 billion. If we assume bad loans at 25% with only 75% of the loans being paid back, the bank’s capital increases to $9 billion. The bank capital growth is exponential. This phenomenal growth would be too alarming for the public so the largesse was siphoned off to subsidiaries as hedge funds, brokerages and insurance companies run by bank associates, friends or school friends, family or ethnic associates

To approach this model the private bankers got control of the Bank of England and the US Federal Reserve. The names are deceiving. Both institutions are not national but are owned by private banks as the latter are the only shareholders. These two organizations print money for these banks.

Mortgages were sold and mortgage salesmen got commission on a percentage of their sales so the more they sold the more money they made. Mortgage banks lowered the down payment and extended the payback period to 40 years so people who normally could not afford were enticed to buy a house. 40 years is a long time and anything can happen. But some of the mortgages were defaulted or the house buyer could not make the payments and the banks realized they had a lot of these mortgages so what they did was to offload these mortgages. They bundled these mortgages as certificates and lied to the insurance companies (mainly AIG) that they were quality AAA certificates to pay lower insurance on them if they defaulted or went bad. This is called “credit default swap”. Credit is the mortgage. The swap is the insurance so if the mortgages goes belly up the buyer of the certificates could get the insurance. But there were so many defaults that the insurance was in danger of going bankrupt from paying. AIG was the insurance company that had to be rescued with bailouts.

The international banks that bought the bad mortgages were deceptively sold AAA-rated income producing certificates so unknowingly thought they were assets. Those mortgages had been sold to people who could not afford the mortgages and also 40 years is a long time as anything can happen before maturity. The seller got a bonus regardless if the mortgage was good or not. In reality the toxic mortgages were non-paying thus became liabilities and so the international banks’ balance sheet became unbalanced. They had less asset reserve to liabilities. I am not sure if the Net Capital Rule also holds for international banks. With Net Capital Rule at 1:15 only 1/15 of the debt or liabilities need be capitalized. So adding to capital or cash reserves would only 1/15 of the total debt would make the banks normal and operational.

How did the housing bubble occur? Speculators on advice from economists hired by real estate builders were given the profiteering scheme as follows:

Put as small as possible a deposit, or down payment, of $1,000 on presale. Then when the units are built sell it at market price of $300,000 so with rising house prices the speculators makes a killing of $300,000 - $1,000 = $290,000. If the speculator borrowed that money from the bank he paid only the interest for a year or two. At 5% he would have paid $50 interest and with $300,000 he could repay the bank loan and netted $299,950. The more houses he speculated the more he made. This was easy money so speculators rushed in. They created an artificial demand and builders couldn’t keep up with the demand and prices began to rise till they reached people with low income and were enticed with little or no down payment and extended 40-year mortgages. People who wanted houses for living were fulfilled and late builders and speculators increased the supply of houses beyond true demand so prices had to fall. Speculators and builders created the bubble. Notice the developers made a lot of money and one of the richest people around and they control municipal politicians with their party donations. The developers make huge profits from hi-rises but they exacerbate traffic. Hi-rises are 3D and traffic is 2D so there will be crowding and traffic delays which municipalities have to deal with public money on traffic upgrades. Hi-rise developers should have been made to pay for the traffic upgrade as they squeeze more people into one square foot of land. So there is one source of taxes and costs are transferred from the developer to the public. The municipal politicians are “hired” developers’ representatives as developers fund their campaigns.

The Roman Empire is a good example. The upper class (3% of the population) mostly senators and land owners were filthy rich. 1/3 of the population were slaves and the rest poor. The only way out of poverty was to become a soldier. There were two sources of power: the senate and being Caesar with an army. The Roman empire prospered on conquest. The loot was pay for soldiers and the state. The larger the empire became the greater the area that had to be protected so this stretched manpower requirements for the army thus mercenaries were employed. Soldiers were given lands that were conquered outside of Italy. Conquest brought slaves and enemy soldiers were captured for gladiatorial events in the Colosseum. Soldiering is a young man’s vocation. When the soldiers retired they turned to farming. Bad weather could put these former soldiers in debt and also they could not compete with the slave-owning upper class with large farms. So these retired soldiers became poor or were enslaved by debt. The poor eventually all entered the big cities. The emperor knowing he had a revolt at his doorstep with so many poor people nearby, he wisely periodically provided free grains for the poor of the city and also to win political favour. Also he knew the poor had to be occupied as there were no television in those days. The Colosseum was built and the gladiator fights were one way to get rid of captured enemy soldiers. Lead poisoning led to erratic behaviour of emperors like Caligula and Nero for aqueducts were lined with lead piping. ‘Plumbum’ is Latin for lead so that is how we got the word plumbing. The economic oppression and the mercenaries’ plots weakened the Roman empire. A German mercenary led the Roman legions to a trap in the Teutoburg forest when they marched single file. The Roman legions were vulnerable when stretched single file when attacked on their flanks by ambush. Citizens were so oppressed that they opened the gates of Rome to invading armies. They figured they would be free of the economic oppression with system destroyed.
 
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[h=1]Does your job attract psychopaths?[/h]
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By Jennifer Kwan
Jennifer Kwan






By Jennifer Kwan | Insight – Fri, 23 Nov, 2012 12:48 PM EST








  •  Inc -


The main character in Bret Easton Ellis' "American Psycho" forever changed how we view good-looking, successful businessmen, and apparently psychopaths lurk in a range of professions.
They especially thrive in professions that give them lots of power and don't require much feeling, Eric Barker writes in his Barking Up The Wrong Tree blog. He references Kevin Dutton's book: The Wisdom of Psychopaths: What Saints, Spies, and Serial Killers Can Teach Us About Success.
The crux of all this argument is that being a psychopath doesn't simply mean killing a lot of people. Psychopaths typically have a lack of emotions and empathy, or the ability to identify with others. Egocentrics and impulsivity may also be telltale signs.
Dutton is an Oxford professor who spends time researching the positive side of being a psychopath. Apparently society thrives if a small portion of them exist.
One reviewer characterized the book as being a "convincing study shows that business leaders and serial killers share a mindset."
The professor and author claims that psychopaths have a distinct set of personality characteristics we may see all around us such as "ruthlessness, fearlessness, mental toughness, charm, persuasiveness — and they lack a conscience and empathy," he tells USA Today.
"I wrote the book primarily to debunk deep-seated myths the public has about psychopaths — that they are all bad or mad," he is quoted as saying. "No sooner does the word 'psychopath' come out of our lips then images of (1970s-era serial killer) Ted Bundy and serial killer A-listers come to mind."
So back to what professions draw and repel psychopaths?
Psychopaths are most drawn to being a CEO, lawyer and media type, especially TV and radio. These three rank at the top of a list of 10 most attractive professions that also includes police officer, chef and civil servant.
On the flip side, psychopaths may be least drawn to professions that require human connections such as being a care aide, nurse or therapist. Other professions on this list include creative artist, doctor and accountant.
Professions psychopaths are drawn to:
1. CEO
2. Lawyer
3. Media (specifically TV and radio)
4. Salesperson
5. Surgeon
6. Journalist
7. Police officer
8. Clergyperson
9. Chef
10. Civil Servant
C'mon, you must be curious: do you have psychopathic tendencies? Try Dutton's test.

I am surprised that a banker is not included in this group that psychopaths would gravitate to.
 
It makes sense. Psychopaths picking anything with position of power. To have directing/ruling role and many subordinates. In such position they can pick many victims, often hopeless victims who are not in position to demand, complain or threaten the boss psychopath.
Somehow they missed Drill Sargent.

By same logic pedophiles pick jobs in occupations overseeing children in orphanages, camps or as priests.

What I don't like is that they throw in as psychopaths people who do harm to others accidentally. People without empathy can hurt others because they don't realize they do (it's hard without empathy). Probably most journalists are like this, and you have to be, to be able to ask questions without scruples.
True psychopaths, on other hand, have lots of feelings, but they are wired the wrong way. Empathy doesn't give them pleasure, but suffering of others does. The worst types of them are simply addicted to human misery, they actively spend time creating situations to cause human suffering, just to experience more pleasure/high. The group includes serial killers, many dictators, bosses from hell and many spectators of American Wrestling (the most psychopathic "sport" every).
 
oriental said:
One wonders how could this all happen? The goldsmiths used to keep their customers’ gold as merchants didn't want to carry so much gold around on their person so the cheque was invented. The goldsmiths realized that only a portion of the value of their customers' gold holdings was involved so they took advantage of that and lent out more money. They realized they could lend seven times the value of the gold in their "banks" or basements. When the loans were repaid they collected seven times the value of the customers’ gold plus the interest and service charges. That is how the wealth of the goldsmiths-turned-bankers grew. They increased the "Net Capital Ratio" to 15 so their "capital" grew even more. They made all that money from their customers' gold. So one can see how the bankers took over the economy. The interest was declared as "income" while the repaid loans were not but as recapitalization. This largesse was spread into hedge funds managed by their close associates or ethnic group. Money was provided for their group to start businesses or to take over businesses. Money was also provided to educate their ethnic group.
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So what? It looks that it works for at least 500 years. Wouldn't you say that it worked for a long time to prove itself right? Off course, as with everything in life, balance has to be held in moderation. In this case Net Capital Ration should not exceeding x15.
Good example is canadian economy with canadian banks:
The average capital reserves for Canada's Big Six banks — defined as Tier 1 capital (common shares, retained earnings and non-cumulative preferred shares) to risk-adjusted assets — is 9.8%, several percentage points above the 7% required by Canada's federal bank regulator.
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Wow, they are at x10, didn't even risk going to x15. Impossible, they should be greedy bankers!!!
http://www.time.com/time/business/article/0,8599,1855317,00.html



If banks proved for 500 year that it is doable, and with right ratio health for economy, why do you listen to Michael Hudson who says that these Fictitious Capital will lead to destruction of our economies? Ask yourself a question, who is right: 500 year history of modern Banking system or hypothesis of Micheal Hudson?
 
oriental said:
One wonders how could this all happen? The goldsmiths used to keep their customers’ gold as merchants didn't want to carry so much gold around on their person so the cheque was invented. The goldsmiths realized that only a portion of the value of their customers' gold holdings was involved so they took advantage of that and lent out more money. They realized they could lend seven times the value of the gold in their "banks" or basements. When the loans were repaid they collected seven times the value of the customers’ gold plus the interest and service charges. That is how the wealth of the goldsmiths-turned-bankers grew. They increased the "Net Capital Ratio" to 15 so their "capital" grew even more. They made all that money from their customers' gold. So one can see how the bankers took over the economy. The interest was declared as "income" while the repaid loans were not but as recapitalization. This largesse was spread into hedge funds managed by their close associates or ethnic group. Money was provided for their group to start businesses or to take over businesses. Money was also provided to educate their ethnic group.
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Can you elaborate what ethnic group(s) you are referring to?
 
LeBrok said:
It makes sense. Psychopaths picking anything with position of power. To have directing/ruling role and many subordinates. In such position they can pick many victims, often hopeless victims who are not in position to demand, complain or threaten the boss psychopath.
Somehow they missed Drill Sargent.

By same logic pedophiles pick jobs in occupations overseeing children in orphanages, camps or as priests.

What I don't like is that they throw in as psychopaths people who do harm to others accidentally. People without empathy can hurt others because they don't realize they do (it's hard without empathy). Probably most journalists are like this, and you have to be, to be able to ask questions without scruples.
True psychopaths, on other hand, have lots of feelings, but they are wired the wrong way. Empathy doesn't give them pleasure, but suffering of others does. The worst types of them are simply addicted to human misery, they actively spend time creating situations to cause human suffering, just to experience more pleasure/high. The group includes serial killers, many dictators, bosses from hell and many spectators of American Wrestling (the most psychopathic "sport" every).
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You elaborated a very important truth, which is unfortunately often misunderstood in today mainstream.
Empathy indeed does not make a human better or worse. It is like a tool which one can use this or that way. Autistic individuals do not act less morally on average despite their lack of empathy (a vague term anyway). For the same reason no one would blame a blind person if he accidentally hits another person.
Your remark on sociopaths is especially true. Empathy makes sadism possible and is a powerful tool to read others minds and take advantage of others. Some empathic people also get disgusted by others because they can empathically feel their misery (examples are inability of some persons to do nursing or certain health care jobs due to burdensome empathic feelings for the miserables; or when certain middle class people feel disgust or shame about lower class persons). Empathy is neither good or bad.
Unfortunately empathy is being promoted in the media as the gold-standard for human traits, as if someone would need an extra reason to do NO harm to others. This is perverted logic. Only if someone actually DOES harm to someone, then he must had a reason/motivation (whether good or bad reason is a different question).
 
If banks proved for 500 year that it is doable
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The problem is not whether it is doable but how come the governments never took efforts to get revenue out of the banks exponential growth. Do you feel people who prints money should become richer than people who create and manufacture material goods. Maybe the political parties are in on the profits. Notice the parties of the Republicans are all from executives of large corporations and banks.

It seems you have been ignoring all the threads on Eupedia of the Eurozone.

Can you elaborate what ethnic group(s) you are referring to?
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Could be any group. In India it is the Marwaris, In China the Communist Party, in Soviet Russia the the Politburo members, in America the Jews. Any of the bankers would likely keep their loot within family groups or ethnic groups. Look into any famous and rich banker and you will see people around them are their families, childhood friends, ethnic groups. It is only natural. Maybe they were clever enough to hide the truth. It is the failure of government to control the situation. It was a failure. There has been financial crises before. All kinds of ethnic groups were involved for instance Italians, Irish and Jews were active during the Prohibition period. The 1929 Crash had everyone involved.
 
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Serial killers' brains were studied and it was found that the amygdala the tiny part in the middle of the brain in human reptilian brain is smaller than normal. The amygdala is responsible for emotions such as fear, love, empathy. It appears psychopaths are devoid or have very little feelings. It appears they have more analytical minds so they can carry on without remorse and thus achieve greater results. The smallness of the amygdala in psychopaths may be why they have only a small range of feelings just the fundamental emotions of fear and anger to fight. Probably no love or empathy.

I am rather analytical and thus I thought would make a good psychopath. I took the test and came out with 15/33. So I don't make a good psychopath!!!
 
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oriental said:
The problem is not whether it is doable but how come the governments never took efforts efforts to get revenue out of the banks exponential growth. Do you feel people who prints money should become richer than people who create and manufacture material goods. Maybe the political parties are in on the profits. Notice the parties of the Republicans are all from executives of large corporations and banks.
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There is no exponential growth of banks. The table from few post above makes only mathematical sence but not in practice. If you spend a moment with your calculator or spreadsheet and expended this table to 200 years (why not, some banks existed for that long or longer) you would have seen that by year 200 the bank would had 3,735,499,335,776,130,000,000,000,000,000,000,000,000,000,000,000,000.00 dollars (or other currency). There is not even a name for this huge number, lol. Can you point us the the bank on this planet that have even one billionth of it? Well, in real life there is no exponential growth in banking, not even close.

Having said that, I'm not totally satisfied how banking industry works right now, from "creative" derivative products to ballooned salaries of CEOs. Nevertheless, the banking, the financial side existed for a very long time and is highly tuned with our economy. There is no reason to destroy it.


Do you feel people who prints money should become richer than people who create and manufacture material goods.
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Here is the list of richest people on earth. How many bankers do you see?
http://thetechjournal.com/internet/...-of-worlds-richest-bill-gates-dethroned.xhtml
Here is the list of biggest companies. How many banks do you see? How many old banks that grew huge and fast exponentially?
http://en.wikipedia.org/wiki/List_of_companies_by_revenue




It seems you have been ignoring all the threads on Eupedia of the Eurozone.
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What do you mean? Do we have Eurozone as sub-forum or something? I need some clarification here.



Could be any group. In India it is the Mulwaris, In China the Communist Party, in Soviet Russia the the Politburo members, in America the Jews. Any of the bankers would likely keep their loot within family groups or ethnic groups. Look into any famous and rich banker and you will see people around them are their families, childhood friends, ethnic groups. It is only natural. Maybe they were clever enough to hide the truth. It is the failure of government to control the situation. It was a failure. There has been financial crises before. All kinds of ethnic groups were involved for instance Italians, Irish and Jews were active during the Prohibition period. The 1929 Crash had everyone involved.
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My google can't find Mulwaris. I need help here.
Communist party of China or Soviet Politburo can't qualify as an ethnic group. Besides, they both had their banking system messed up pretty good. Not sure why you had mentioned them?
At the end you pointed out only one ethnic group, Jews. Sure, they are smart in banking, but it also goes being smart in science and art. It would be nice to give them some credit for the movies you enjoy, for the music, for the inventions, relativity, and many medications that you might be taking. And if it comes to the banks, they pay taxes too, and yes it pays for part of your health care, roads, etc. I guess your table doesn't mention paying taxes, or losing some income to inflation.
What do you mean by hiding the truth? Do you mean that they found long lost Phoenician manual how to make money?
At the end, I would like to mention that this is a free market economy. You can open a bank or a credit union and get the licence from government to print money, and grow exponentially. You don't need to be Jew to do that, you know.
 
There is no exponential growth of banks
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Obviously you didn't follow what I wrote

The bank capital growth is exponential. This phenomenal growth would be too alarming for the public so the largesse was siphoned off to subsidiaries as hedge funds, brokerages and insurance companies run by bank associates, friends or school friends, family or ethnic associates
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These bankers are cunning thus they hid everything. Even the economists might be in on it as there are no texts regarding banks making exponential income disguised as capitalization except Michael Hudson.


I just wrote this up.
As the first banks were in the temple in Egypt and Mesopotamia, it could be that to keep track of accounts and transaction led to writing as the tablets in Sumeria indicate. So the myth keepers, the priests, were at the top of the society. They knew enough to have their myths instilled in young children so within a society it would be permanent.

The Bible requirement of tithes is an example how clever the priests were. Suppose there were ten people including the priest i.e. nine ordinary people and one priest. The average income is $10. Each had to give 1/10 of his income so each would contribute $1. So the nine people would contribute totally $9 to the priest for spreading the myths. Everyone therefore has a $9 income. Now if there were 99 people with 1 priest the priest gets $99 while the rest have $9 for average income. The priest makes more than 10 times the average Joe. With a thousand the priest makes $999 while his flock average only $9. Not bad for scaring people with hell a sort of protection racket from hell.
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