Archive for October, 2012

List of Swiss Accounts Turns Up the Heat in Greece (Via NYT – Full text copied)

Posted in Crisis, current events, Democracy, Financial crisis with tags , , on 28/10/2012 by Living out of Eden
ATHENS — A former Greek culture minister, several employees of the Finance Ministry and a number of business leaders are on a list of more than 2,000 Greeks said to have accounts in a Swiss bank, according to a respected investigative magazine. The Greek magazine, Hot Doc, published the list on Saturday, raising the stakes in a heated battle over which current and former government officials had seen the original list passed on by France two years ago — and whether they had used it to check for possible tax evasion.

   Petros Giannakouris/Associated Press

Giorgos Voulgarakis, a former culture minister, accused a Greek magazine of mudslinging.

   Yorgos Karahalis/Reuters

Finance Minister Yannis Stournaras was scheduled to testify on the Swiss accounts list.

Hot Doc said its version of the list matches the one that Christine Lagarde, then the French finance minister and now the head of the International Monetary Fund, had given her Greek counterpart in 2010 to help Greece crack down on rampant tax evasion as it was trying to steady its economy. The 2,059 people on the list are said to have had accounts in a Geneva branch of HSBC.

Questions about the handling of the original list reached a near frenzy in Athens last week as two former finance ministers were pressed to explain why the government appeared to have taken no action on the list. The subject has touched a nerve among average Greeks at a time when the Parliament is expected to vote on a new 13.5 billion euro austerity package that could further reduce their standards of living.

The publication of the list is likely to exacerbate Greeks’ anger that their political leaders might have been reluctant to investigate the business elite, with whom they often have close ties, even as middle- and lower-class Greeks have struggled with higher taxes and increasingly ardent tax collectors.

The magazine was careful to note that having an account at HSBC was not illegal or proof of evading Greek taxes, a point underscored by a spokesman for the Greek Finance Ministry. But the magazine suggested that Greek officials should check whether those on it had moved money into the accounts to escape paying taxes.

Hours after the magazine hit newsstands, Athens prosecutors issued a warrant for the arrest of Kostas Vaxevanis, the owner and editor of Hot Doc, “where names from the Lagarde list have been published,” the Athens police said in a statement on their Web site. They said he was sought on misdemeanor charges; the Greek media reported that the charges were related to violating the privacy of those on the list.

Mr. Vaxevanis, one of Greece’s most famous investigative journalists, said he was being wrongly targeted. “Instead of arresting the tax evaders and the ministers who had the list in their hands, they are trying to arrest the truth and free journalism,” he said in a telephone interview that was uploaded on the Internet and widely circulated.

The issue of the list has shaken the country for weeks, posing new challenges to the fragile three-way coalition government of Prime Minister Antonis Samaras. Above all, it put intense pressure on the Socialist party, a key member of the coalition, whose leader, Evangelos Venizelos, is one of two Socialist former finance ministers accused of not having acted on the information.

The finger pointing, likely to intensify with the list’s publication, is certain to distract Greek politicians during a week when European finance ministers are scheduled to discuss whether to release billions of euros in fresh financial aid. Greece’s lenders have long said that the country must crack down on tax evasion to be eligible for further infusions of cash.

According to Hot Doc, the list includes not only some in the government and businesspeople, but also actors, doctors, lawyers and architects. It also includes several women identified as housewives who the magazine said had moved large amounts of money to the HSBC accounts.

There was no immediate comment from Mr. Samaras, who was meeting with aides throughout the afternoon to discuss the new austerity measures demanded by Greece’s lenders.

Giorgos Voulgarakis, a former culture minister from Mr. Samaras’s center-right New Democracy party, denied having any overseas bank accounts and accused the magazine of mudslinging.

Hot Doc said it had been given the list by “one of the people who had received” it. Yannis Stournaras, the finance minister, sent a letter to his French counterpart several days ago asking for the original list, but so far the Greek official has not received a response, according to the ministry spokesman, who was not authorized to speak publicly. The aide said that the Greek Finance Ministry wants to be certain that it has the original list of names before investigating whether any tax evasion occurred. The magazine said it had called a sampling of account holders on its list to confirm that they had deposits in the Swiss bank. Citing privacy concerns for those on the list, Hot Doc said it had redacted how much money was said to be in each account, but added that some accounts were listed as containing as much as 500 million euros. The list dates to 2007.

The magazine also carried a long report on Mr. Voulgarakis. According to Hot Doc, Mr. Voulgarakis, who also previously held the public order minister and merchant marine portfolios, opened an account at HSBC in 2003 that was jointly managed by him, his wife and an offshore company based in Liberia.

The magazine said the deposits do not show up on Mr. Voulgarakis’s tax declarations.

Mr. Voulgarakis, a former government minister who was investigated but later exonerated in another high-profile corruption inquiry, issued a statement saying, “I declare categorically that neither my wife nor I have any offshore companies or foreign bank accounts.”

On Friday, the office of former Prime Minister George Papandreou denied claims that he had been aware of the list, after a member of the opposition Syriza party alleged that Mr. Papandreou had helped set up a meeting with the head of the Geneva HSBC branch in Geneva when he was in office.

Last week, former Finance Minister George Papaconstantinou told lawmakers that he had asked Greece’s financial crimes unit to investigate about 20 Greek citizens thought to hold large deposits at the HSBC Geneva branch after French authorities forwarded him the list of names in October 2010.

But he said the Finance Ministry’s legal adviser had warned that the list was a problem because a HSBC employee had illegally leaked it.

This article has been revised to reflect the following correction:

Correction: October 28, 2012

An earlier version of this article misstated the position of Giorgos Voulgarakis. He is a former culture minister, not the speaker of the Greek Parliament. The error was also in a photo caption accompanying the article.

A version of this article appeared in print on October 28, 2012, on page A8 of the New York edition with the headline: List of Swiss Accounts Turns Up the Heat in Greece.

Link to original news:

http://www.nytimes.com/2012/10/28/world/europe/list-of-swiss-accounts-turns-up-the-heat-in-greece.html?_r=0

Weather forecast

Posted in Crisis, current events, Economics, Financial crisis, politics, Society with tags , , on 27/10/2012 by Living out of Eden

The destructive power of a hurricane is nothing compared to the level achieved by human financial “para-normal” activity.

Insurance companies (with quite logical grounds), have strict exclusions in policies. They might differ according the specific case and type of insurance cover, but in general terms, companies protect themselves either from events that could lead to a massive payment (which would mean their bankruptcy) like natural catastrophes or acts of war, either from a personal decision of the taker, that might involve high risk activities or irregular situations.

It could be said that something similar happens in the “market” of real estate mortgages, where if a structural event might occur, that would also lead the banking system to its collapse (sounds familiar, doesn’t it?). Because, in my humble opinion, it’s completely different cases, should individuals fail to pay their debts, due to personal reasons, than if hundreds of thousands are affected by a global crisis.

But, the thing is that financial crisis are not natural catastrophes. Let alone, comparing mortgages takers with bungee jumpers, or skydivers, or heli-skiers.

This leaves me, I could say the least, restless, the most, furious, whenever new proofs arise that the current synchronic financial crisis (which I’d swear is just only one), has been generated by unpredictable forces of the financial markets, supposedly under the survey of Stock Exchange Commissions, governments and all kind of virtual organisms of control.

It’s an extremely profitable business to protect yourself from the devastation you cause.

Posted in Society on 25/10/2012 by Living out of Eden

IM Sirius

“Individual rights are not subject to a public vote; a majority has no right to vote away the rights of a minority; the political function of rights is precisely to protect minorities from oppression by majorities (and the smallest minority on earth is the individual).”
— Ayn Rand

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The figures of the rip-off (via Colectivo Novecento)

Posted in Crisis, current events, Democracy, Economy, Financial crisis, politics, Society with tags , , , , on 24/10/2012 by Living out of Eden

October 22nd, 2012 by Ricardo Molero Simarro

The delay in the approval of the measures to build the so-called “bank union” within the UE, will turn out to be the confirmation of what was an open secret: the bailout to the Spanish private (or privatized) banking system it’s going to be finally integrated into the amount of public debt. This will be the last-but-one step of the process to socialization of private losses we are living since the crisis begun. A crisis that, as it is more than evident for a majority of the people, it’s not a crisis, but an utter fraud. The amount reached by this socialization is actually hard to estimate, but it is possible to come up to an approximate number, just by summarizing the main operations of the banking system bailout, that had been and are still being, carried out.

We must start by remembering that, in spite of the false rhetoric that says “we’ve been living over the top of our possibilities”, as Eduardo Garzón explains, the public debt has not yet reached more than a 20% of the total Spanish Economy debt. It should also be taken into account that this figure corresponds to the end of last year, once that according to European Comission data, public debt has practically doubled, since its previous level, before the crisis, increasing from a 36,3% in 2007 (one of the lowest levels in the whole EU), to a 68,5% in that year, 2011 (a figure that is even lower than that of Germany, France, and of course, Greece, Italy, Ireland or Portugal). It means to say that opposite to the spread notion debt problem comes from the spending of money in the public sector, and because of that, it’s size reduction and the cuts in the services it delivers would be the solution to the crisis, the truth be told, debt has a clear private nature.

Not in vain, from the total amount of indebtedness of the Spanish economy, that exceeds the 300% of the GDP, it’s banks, companies and families debts that constitute up to an 80% of it. The debt of the latter, is merely a 25%, while that of the banks and companies, represent the remaining 75%. And among these second ones, a 95% belongs to large companies. Moreover, as also points out Eduardo Garzón, 40% of lower income families, allocate up to a 75% of the acquired debt to the financing of their mortgage on their first home, which is a basic social right, guaranteed by the Constitution.

Which, again also means, that against the also extended notion that all the people would have taken part of the Property bubble, and because of that, now they’d ought to pay the bill of the crisis, it’s actually only those who had capacity to take part in that kind of investment, the ones who made profits with Real Estate speculation, i.e.: higher income families, contractors, developers, and banks themselves.

Although at its time, benefits of economic growth generated by the bubble remained in the hands of a few, since 2008, losses that the financial crisis produced have not ceased to be driven through public finances. According to data from the European Comission itself, the amount of public bailouts to the banks between 2008 and 2010, that is even before the famous rescue appeared on the horizon, could ascend to an 8,4% of the GDP. As Bibiana Medialdea explains, that amount, transferred to the banking sector in great deal through the FROB, there would have been 10.8 billion assisting recapitalization of banks, 55.8 to warrants given to them to take debt with third parties, and 22.18 in financial facilities and liquidity injections. These figures, that were accounted as public debt, show together with the loss of tax incomes generated by the crisis, that the amount of the latter, will reach the 80% of the GDP this year (2012), after having increased the expense on the payment of interests it generates, in an 80% between 2007 and 2012.

However, in spite of the fact that this means an unlawful load for the State, these public funds dedicated to assist the banking sector, shouldn’t have meant such impact in the interests. If the ECB should have financed the States directly, instead of providing public and subsidized credit to private banks, the cost of this financing should have been significantly lower. The bottom line is that while from the beginning of the crisis, a credit facility at an interest rate of 1% and 1,5% has been available to the European private banks, the ECB has a prohibition by its Statutes to give loans to States. Far from driving this credit to companies or families, this bank sector has destined this credit to speculate with public debt of countries like Spain, getting returns of more than 5% (spread between rates of ECB loans and that the Spanish State has been forced to issue its debt titles). For us to have a better idea of the magnitude of this mechanism, according to Banco de España data, the net amount that Spanish private banks had obtained through it, reached last August, the figure of 388 billion euros.

But not even with this mechanism, that have contributed decisively to multiply the amount of interests paid by the State, has been enough to clean up the banking system. Calculations made by private consultants Oliver Wyman say that spanish bank entities would still need another 55 billion euros of direct capital injection by the public sector. This figure is the one that will be sourced by money from the EU bailing mechanism. The amount that the State would absorb for the bailout of the private sector, including it, as said at the beginning, in the total public debt, would be of 40 billion euros, from a total of 100 billion to be made available through the EU open credit line.

However, these funds would not be – again – enough, since after setting the bailout, there would be still outstanding the “icing on the cake”: the cleaning up of those so-called “toxic assets” (mainly from the property market) showed in the balance sheets of banks, which, according to calculations of BdE (Bank of Spain), would exceed 180 billion euros. From that number, it is expected that the “banco malo” (lousy bank) the Government is determined to create, would acquire some 90 billion, which financing, as Antonio Sanabria says, will come in good part from FROB transfers, or will be guaranteed by the State.

In summary, all this means that public help given to private banks since 2008 would reach 218 billion euros, which equals approximately the 20% of the GDP of Spanish economy, and 1/3 of public debt in 2011. From that amount, at least 73 would be direct financing. To these figures, another 400 billion should be added, from the ECB loan facility. All of which comes to show, as I affirmed in a previous article, that in next year General Budget of the State 40 billion must have been cut in services like Public Health, Education, R+D, or dependence, as counterpart of the, at least, 38 billion that debt interests payment will mean.

As the motto of “Plataforma por una Auditoría Ciudadana de la Deuda” (Platform for a Citizen Debt Audit) says, this is a debt we don’t owe and hence, we shouldn’t have to pay. Firstly, because it is unlawful it should be assumed by the whole of the people when, as we described above, it was just a group of privileged ones those who had created it. Secondly, because as Miguel Montanya pinpoints, bailouts don’t work. And at last, because the measures taken to make it work, are pushing us, as it is currently happening in Greece, Ireland or Portugal, to an utter economic and social dislocation. It’s not for free that Spanish economy has fall to the bottom of world growth, only before Greece, and inequality and poverty are nothing but soaring. That is why we don’t owe, but mostly because we must not pay, this week it’s time to demonstrate. There’s no other way of stopping this fraud.

Original post (in Spanish):

http://colectivonovecento.wordpress.com/2012/10/22/las-cifras-de-la-estafa/

Be merciful with us, the rest of the World.

Posted in current events, Democracy, politics, Power, Revolution, self-managed, Society with tags , , , on 21/10/2012 by Living out of Eden

Please, don’t vote.

Many thanks in advance.

With kind regards,

Between a rock …

Posted in Behaviour, Crisis, Culture, Democracy, Economy, Evolution, politics, Power, self-managed, Society with tags , on 21/10/2012 by Living out of Eden

For centuries, in Occident, we’ve been taught that our own success will come from the part, and not from the whole.

What do I mean by this? Too many things. In every aspect of our lives, we have been and still are, biased by approaches that tend, all of them, to keep our minds focused in the details and in separate things. I’d even say that in the most holistic approach, it will still lack of global vision.

That would be perfect, more than enough, in a society that caters all its members with some guarantees for survival. In fact, societies actually did, when referred to elements and Nature  (Well, not really at a 100% – remember Katrina, for instance….).

The issue now is that, beyond natural catastrophes, Society (Global Society,  The “Whole World Society”), has become autoimmune, and is slowly and imperceptibly, destroying itself: from the current financial crisis, to the Oil peak, the demographic crisis, the climate change, access to water, starvation of billions of people, energy consumption (waste), and …. (you name it).

We’ve been taught (not consciously, that’s obvious) that we can get through by ourselves (each one of us, separately), and that we have to have a strategy – individually, to solve our own lives. We have, however, some concepts in common that help (do they help?) somehow all of us, along the way: God and religion, our country, our city, our neighbourhood, and so on, narrowing more and more each time, the circle of exclusion, until … again … there’s only …. YOU, remaining. And that’s it.

That’s the best strategy corporations could have ever achieved. That’s the strategy that best works for their purposes.

On the other hand, what would it be like, to gather forces?

Would it be like “Communism”, “Totalitarianism”, “barbarianism”?

Would we lose our identity if we “melt” in a larger organized group? I’m sure we wouldn’t, but we are still so reluctant of the “others” that seems it will still be a long way to go.

We must start preparing ourselves, find a balance between the “individual” sphere and the social one.

We will have to imagine, learn, adopt, develop, improve, new ways of taking care of ourselves.  Nobody else will.

But, hey! Don’t worry. I know your answer already.

Hardness

Posted in Crisis, current events, Democracy, Economy, politics, Power, Society on 21/10/2012 by Living out of Eden

There are just three things in our world, as hard and solid, as stone.

1) Stone itself.

2) Concrete (which although artificial, and fluid in its original state, it becomes pretty much as stone, when settled and hardened).

3) Profits of corporations.