Figured you might find this interesting. There was a massive leak of offshore accounts details, which is apparently got lots of juicy info in it. http://www.icij.org/offshore/secret-files-expose-offshores-global-impact
http://www.icij.org/blog/2013/04/highlights-offshore-leaks-so-far
Nice, very well done and my appreciative thanks. At least 1/3 of the world's wealth is stagnating in bank accounts seemingly doing nothing useful, huh. No wonder I can't find a job.
That's why one of Occupy's main messages has been that inequality is the problem. When somebody has so much wealth that they literally have no use for it other than hoarding it for its own sake, everyone else suffers for their obscene mental compulsion.
Don't banks invest money on behalf of their investors (account holders)? Just because there's money in an account, doesn't by itself tell us the "money is doing nothing useful".
The money sitting idle in the bank is a symptom of the problem, though, not the problem itself. Unutilized money ceases to have any economic meaning. e.g. if you had 1 billion dollars and bury it in a hole in the ground, that's 1 billion that's no longer in circulation. Too much aggressive investing could actually be inflationary / a bubble, e.g. you might prefer the money sits in the bank rather than everyone drives property prices through the roof for "investment properties", and regular people can't buy or rent a house.
If they don't invest it locally or in country at least, it encourages the current banking system (in the USA) to release freshly printed money directly to the banks because the system is designed from a trickle down perspective. If I may propose a theory, this causes inflation which doesn't effect the banks (as much) because they are the ones receiving the new money supply. By giving it directly to banks to loan, if they fail to put it back into a useful place, there is no recourse but to give them even more money in the hope they do something useful. If they receive 100% or a large percentage anyways of the new money, by not loaning what they receive, the inflation would not apply as much to them as they are the ones receiving the new money and thus the inflation, which is sort of percentage based will not effect them meaningfully because it puts even more of a majority of the money supply into their power. Meanwhile, non-banks are effected dramatically by the manipulation of money supply and clamor for ever lower interest rates because apparently the banks are not receiving enough to loan.
Meanwhile, at such low interest rates, there doesn't seem to me much incentive for banks to loan out more than what is necessary to pay back the interest or to fulfill their obligations. I'd suggest this is why growth has been extremely modest; the banks only loan the bare minimum to cover their obligations, which are themselves growing greater due to their accumulation of Fed loans; in other words an increase of volume being behind the modest growth despite being near 0% interest to the banks and much higher when leaving the banks, allowing them to easily limit the amount they have to put out for loan. Thus, perhaps if a large, likely international bank wishes to continue to accumulate easy, easy capital which can then loaned out at dozens or hundreds of times the interest they pay to the Fed (possibly once Fed interest rates go back up, as to increase loans now might stimulate the economy enough to encourage the Fed to raise rates on future loans), a bank could easily benefit if they allow their money to stagnate for as long as it continues to result in very low interest rate loans from the Federal reserve.
My solution would be to raise the Fed's rate as well as raising the rate on already outstanding loans. It would not crash the banks unless they refuse to find good loans or unless good loans do not exist. If good loans do not exist if I had the power I'd set up a government controlled banking and loans to operate at a minimized loss headed up by people disconnected and perhaps even that despise the current banking industry yet who are knowledgeable and willing to learn enough to run such a thing, and the leader would have to be a person with political ambitions willing to sign a non-corruption agreement wherein he trades all his 'political capital' if the organization becomes corrupt under their watch.
To allow the banks to continue what I consider blatant looting of government and citizens will result in an a slowly at best but surely inflated currency, an inflation that effects the many small holders of money the most because they have the least and that little will be worth less in trade, and the much fewer large holders almost nothing because they will have accumulated all the additional money added to the system while still being the most likely, on an individual level, to be able to flee from the currency should it indicate a crash due to inflation due to having enough to be able to live internationally rather than being forced to live locally.
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Topic: Occupying Wallstreet (Read 295889 times)