DACA activists protest at the Capitol: "We shall not be moved"
DACA activists protest at the Capitol: "We shall not be moved"
Demonstrators gathered on Capitol Hill on Feb. 7 to demand a budget deal that includes an alternative for DACA, an...
Demonstrators gathered on Capitol Hill on Feb. 7 to demand a budget deal that includes an alternative for DACA, an Obama-era program that protects roughly 690,000 undocumented immigrants.
Watch the video here.
Yellen Says Improving Economy Still Faces Challenges
The Washington Post - August 22, 2014, by Ylan Q. Mui - Federal Reserve Chair Janet L. Yellen on Friday expressed...
The Washington Post - August 22, 2014, by Ylan Q. Mui - Federal Reserve Chair Janet L. Yellen on Friday expressed growing confidence that America’s market is improving but uncertainty over how much further it has to go.
Yellen began her remarks before a select group of elite economists and central bankers here by enumerating the unequivocal progress made since the Great Recession ended: Job growth has averaged 230,000 a month this year, and the unemployment rate has fallen to 6.2 percent after peaking in the double digits during the depths of the crisis.
But she quickly transitioned to the challenges in determining how close the labor market is to being fully healed — and how much the nation’s central bank should do to speed its convalescence. Although Yellen has consistently emphasized that the recovery is incomplete, her speech Friday focused on the difficulty of making a current diagnosis.
“Our understanding of labor market developments and their potential implications for inflation will remain far from perfect,” Yellen said at the annual conference sponsored by the Federal Reserve Bank of Kansas City. “As a consequence, monetary policy must be conducted in a pragmatic manner.”
The Fed slashed its target for short-term interest rates to zero and pumped trillions of dollars into the economy in the aftermath of the recession. More than five years later, it is finally scaling back that support. The Fed is slated to end its bond-buying program in October and is debating when to raise interest rates.
That decision carries enormous consequences: Move too soon, and the Fed risks undermining the economic progress made so far. Move too late, and it could risk stoking inflation in the future and sowing the seeds of the next financial crisis.
Investors generally expect the Fed to raise rates in the middle of next year, but several central bank officials gathered here cautioned that the moment could come earlier if the recovery improves more rapidly than expected. Yellen gave no clear timeline Friday but called for a “more nuanced” reading of the labor market as the economy returns to normal.
For example, the size of the nation’s workforce unexpectedly declined after the recession, the result of both demographic factors and unemployed workers who gave up hope of finding a job. Yellen reiterated Friday that a stronger economy could help stem that drop and suggested it may already be working. She also said that the run-up in involuntary part-time work and the low level of people choosing to quit their jobs could be reversed as the labor market improves.
But Yellen seemed to shift her stance on the country’s stagnant wage growth. Previously, she has cited it as a sign that the labor market remains weak. But on Friday she called on research that suggests wage growth has been subdued because employers were unable to cut salaries deeply enough during the recession, a phenomenon dubbed “pent-up wage deflation.” She also suggested that globalization and the difficulty that the long-term unemployed face in finding jobs could also be depressing wage growth.
The uncertainty facing the Fed means it will be carefully evaluating economic data over the coming months, Yellen said. And she said the central bank will remain nimble in its response.
“There is no simple recipe for appropriate policy in this context, and the [Fed] is particularly attentive to the need to clearly describe the policy framework we are using to meet these challenges,” she said.
Central bankers were not the only ones gathered in the Grand Tetons this year. Several workers and activists also traveled to Jackson Hole and called on the central bank to be cautious in removing its support for the economy, the first protest at the conference in recent memory.
The grass-roots group, organized by the Center for Popular Democracy, also issued an open letter to the Fed earlier in the week signed by more than 60 activist organizations. Kansas City Fed President Esther L. George — one of the most vocal proponents of raising interest rates soon — met with the protesters in Jackson Hole on Thursday for about two hours to hear their stories. Ady Barkan, senior attorney at the Center for Popular Democracy, said the groups plan to request meetings with other Fed officials as well.
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In Troubled Times, the Federal Reserve Must Work for Everyone
Global Shock It's true that many of the causes of the recent stock market turmoil are global, rather than...
Global Shock
It's true that many of the causes of the recent stock market turmoil are global, rather than domestic. But those distinctions are becoming less important in a world of unfettered capital flow. Regional markets, like regional ecosystems, are interconnected.
Europe is struggling because of a misguided attachment to growth-killing austerity policies. Like Republicans in this country, Europe's leaders are focused on unwise government cost-cutting measures that hurt the overall economy.
China's superheated markets have experienced a sharp downturn, and its devaluing of the yuan is likely to affect American monetary policy. Many of the so-called "emerging markets" are in grave trouble, their problems exacerbated by an anticipated interest rate hike from the U.S. Fed.
Plunging crude oil prices are a major factor in the events of the last few days. But questions remain about the underlying forces affecting those prices. Demand is somewhat weaker, and Saudi officials are refusing to cut production. But there is still some debate about whether these and other well-reported factors are enough to explain the fact that the price of a barrel of oil is roughly half what it was just over a year ago, in June 2014.
American Turmoil
Talk of recovery here in the U.S. has been significantly dampened by events of the last several days. The now-interrupted stock market boom had been Exhibit A in the case for recovery.
Exhibit B was the ongoing drop in the official unemployment rate. There, too, signs of underlying weakness can be found. The labor force participation rate remains very low for people in their peak working years, as economist Elise Gould notes, and has only come back about halfway from pre-2008 levels. Jared Bernstein notes that pressure to raise wages, which one would also expect in a recovering job market, also remains weak.
All this argues for a rational and coordinated policy, one in which the Federal Reserve and the U.S. government act together to restore a wounded economy. What would that look like?
It would not include raised interest rates -- something that nevertheless continues to be a topic of serious discussion. As Dean Baker points out, China's currency devaluation alone should have been enough to take that idea off the table. What's more, as Baker rightly notes, such a move would only make sense if the Fed "is worried that the U.S. economy was growing too quickly and creating too many jobs." That's a notion most Americans would probably reject as absurd. Most are not seeing their paychecks grow or their job opportunities multiply.
Anxiety about inflation, while all but omnipresent in some circles, is not a rational fear. A slow rise in prices (0.2 percent in the 12 months ending in July, as opposed to the Fed's recommended 2 percent per year) tells us that inflation is not exactly looming on the horizon.
Now what?
"Everything is going to be dictated by government policy," the chief investment officerof a well-known investment firm said this week. In that case, isn't it time for a national conversation about that policy?
Another investment strategist told the Wall Street Journal that today's challenges come at a time when "global central banks have exhausted almost all their tools ... It's difficult to see how central banks come in to support markets."
If they've exhausted all their commonly-used tools, it may be time to develop new ones -- not to support "markets," but to promote jobs and growth for everyone.
First, do no harm. The Fed needs to hold off on any move to raise interest rates. But inaction is not enough. It was given a dual mandate by Congress: to stabilize prices and keep employment at reasonable levels.
Activist groups like the "Fed Up" coalition, led by the Center for Popular Democracy (and including the Campaign for America's Future), are working to move the Fed toward that second objective. They've been pushing to change its governing boards, which are heavily dominated by big banks and other major financial interests, and have called for policies that focus on improving the economic lives of most Americans.
Those policies could take a number of forms. One idea comes from Jeremy Corbyn, the populist politician who's on track to become the next leader of Great Britain's Labour Party. Corbyn's economic plan includes "quantitative easing for people instead of banks." Corbyn proposes to grow the financial sector in a targeted way, by giving the Bank of England (the UK's version of the Fed) a mandate to "invest in new large scale housing, energy, transport and digital projects."
A headline on the website of the Financial Times says (with apparent surprise) that "Corbyn's "People's QE" could actually be a decent idea."
Corbyn also proposes to "strip out some of the huge tax reliefs and subsidies on offer to the corporate sector." The added revenue would go to "direct public investment," including the creation of a 'National Investment Bank' to "invest in the new infrastructure we need and in the hi-tech and innovative industries of the future."
Qualitative Easing
Call it "qualitative," rather than "quantitative," easing. It would increase the money supply, but for money that is to be invested in the real-world economy -- the one that creates jobs, lifts wages, and creates broad economic growth.
Could something like Corbyn's plan ever happen here? There's no reason why not. The Federal Reserve wasn't created by bankers, nor is it there to serve bankers -- although a lot of people inside and outside the Fed act as if it were. (The choice of a former Goldman Sachs executive for its latest major appointment won't help change that.)
The Federal Reserve was created by the American people through an act of Congress. Its governors and its policies are there to protect and serve the public. The Fed should use its oversight capabilities to ensure that banks don't behave in a reckless manner or help private funds and other unsupervised institutions to behave recklessly.
We are still paying the price for allowing big-money interests to dominate both lawmaking on Capitol Hill and monetary policy at the Federal Reserve. That must change. Congress and the Fed, acting together, should ensure that our nation's policies benefit the many who are in need of help, not the few who already have more than they need.
Richard Eskow is a writer and editor with the Bernie 2016 campaign, the host of The Zero Hour radio program, and a Senior Fellow with the Campaign for America's Future. The opinions expressed here are his own.
Source: Huffington Post
New Video: Preying on Puerto Rico, The Forgotten Citizens of Hedge Fund Island
New Video: Preying on Puerto Rico, The Forgotten Citizens of Hedge Fund Island
Last month I returned to my native Puerto Rico to attend a wedding and was catching up with family still on the Island...
Last month I returned to my native Puerto Rico to attend a wedding and was catching up with family still on the Island one evening. A couple of sips of whiskey in, and the truth came out: My wife’s father reported that he hadn’t received a paycheck in 3 months.
He is a doctor. A highly specialized one, And, with most of his patients coming through government insurance, he hadn’t seen a dime in payment.
Most Puerto Rican health care professionals try to hang on as long as possible. They want to stay in their homeland, be with their families and help make things better. But increasingly, they have no choice. Now many doctors are among the hundreds of thousands of Puerto Ricans who have become economic migrants, forced to flee from home because they simply cannot survive on patriotism and hope.
In 2014, 364 doctors left the island, the Puerto Rican Surgeons and Physicians Association reported. Last year, 500 practitioners packed up and got out.
“Don’t get hurt on a Sunday or a holiday,” one man recently told CNN after his uncle died because only 2 neurologists were on duty to serve the island’s 3.5 million “forgotten citizens.” (His family now calls the lines at the hospital “the walking dead.”)
Behind those staggering numbers is rapacious, hungry, heartless greed as embodied by two simple words: Hedge funds.
Just like Detroit, Greece and other places rocked by the recession and government mismanagement, Puerto Rico’s debt ballooned over the last decade, further exacerbated by colonial status and expiring tax incentives.
In 2012, hedge fund managers began to circle the Commonwealth, looking to reap billions – and experiment with new wealth extraction strategies that could be imported back to the American mainland. The short version: They bought Puerto Rican bonds after the price fell.
Now these “vulture” managers (as they are literally called for their creditor and distressed buying schemes – los buitres in Spanish) insist that any package from Washington that allows Puerto Rico to renegotiate its $72 billion debt puts Wall Street investors at the front of the line to get paid.
A handful are holding out for even more; refusing to accept any restructuring and demanding even more severe austerity measures and suffering so they don’t have to take any losses on their risky investment.
These carrion feeders are in fact, real human beings, acting in inhumane ways: Mark Brodsky, of the $4.5 billion Aurelius Capital and Andrew Feldstein, of the $20 billion BlueMountain Capital are two leaders of the vulture flock of hedge fund billionaires circling Puerto Rico trying to make huge profits from what’s turning into a full-scale humanitarian crisis.
Brodsky bought up the Island’s debt for as low as 29 cents on the dollar and now is demanding full repayment (Think Greece, and Argentina). He is helping fund economists who argue that vital government services must cease – and schools and hospitals must close - to extract full payment.
Feldstein has teams of lawyers fighting basic protections for Puerto Ricans in court and lobbyists taking the same case to Congress. On his dime they have launched a high profile and highly fraudulent media campaign to make sure Congress keeps working for the billionaires – and against teachers, students, the elderly… and my former neighbors and relatives.
Together with John Paulson – who literally bragged to his bros that together they could create the “Singapore of the Caribbean” and create a tax haven for themselves – these vulture investors are consuming the living, for their greed.
That’s why I’ve been working with Brave New Films and a large coalition, including Make the Road, New York Communities for Change, Organize NOW, Florida Institute for Reform & Empowerment, AFT, SEIU, NEA, New Jersey Communities United, Grassroots Collaborative , Center for Popular Democracy, Strong Economy for All, and Citizen Action, under the campaign banner Hedge Clippers, to help ordinary Puerto Ricans expose the truth about these bad actors and their flock.
Preying on Puerto Rico: Forgotten Citizens of Hedge Fund Island is a series of short film videos that Puerto Rican activists helped create to kick off an escalated series of large actions calling on those with the power to help to stand up for Puerto Ricans and stand up to los buitres.
These same leaders are behind a growing wave of protests on Capitol Hill, Wall Street, the Trump Towers and at the Federal Reserve Board offices in cities across the U.S.
They are getting attention and being heard, but the path forward is uphill. We need your help. With unemployment at 14% and 45 percent of Puerto Ricans living below the poverty line Puerto Rico is in a humanitarian crisis. PROMESA, the bill that just passed out of the US House and is on its way to the Senate, is a bad deal that will help the hedge funds, but not the Puerto Rican people.
Preying on Puerto Rico: Forgotten Citizens of HedgeFund Island is only the beginning of how we can use our voices and votes to help my father in-law remain on the Island to help save lives – and end this suffering caused by these vultures and the politicians that do their bidding.
Join us today to share these films – and call Feldstein and Brodsky to ask them: how many more billions do you need to make before you stop pillaging the poor?
By Julio López Varona / Brave New Films
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Tax reform stumbling block
Don’t look for a tax reform roll-out as soon as Congress comes back despite the aggressive timetable laid out by White...
Don’t look for a tax reform roll-out as soon as Congress comes back despite the aggressive timetable laid out by White House legislative director Marc Short. Part of the reason is that it probably won’t be ready yet. But it also has to wait until after the GOP congress passes a budget resolution, people close to the matter tell MM.
Because if Republicans lay out their tax reform plan beforehand, Democrats could use the budget vote-a-rama process in the Senate to try and attack individual pieces of the plan.
Read the full article here.
4 hours ago
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