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Posts Tagged ‘Financial Framework’

Image result for debt crisisTHE VALLEY OF THE SHADOW OF DEBT
By Carolyn Baker, 2006

Never before have political leaders urged such large-scale indebtedness on American consumers to rally the economy. — Kevin Phillips, in American Theocracy: The Peril and Politics Of Radical Religion, Oil, and Borrowed Money In The Twenty-First Century

In a recent conversation with a friend, a married mother of three, she anxiously confided that although she has never been scared about money in her entire adult life, she now, in her mid-forties, finds herself feeling terrified. “Sometimes I wonder,” she said tentatively, “if it’s our own fault or if it’s the world we now live in. I’ve never worked harder in my life, but I’ve never found myself and my family falling so far behind financially.”

[Many] are no doubt hearing similar anguish issuing from the mouths of friends and family, and in all likelihood, thinking similar thoughts, but they know that the frightening quagmire of debt in which (more…)

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Image result for CABRI budgetBudget Practices and Procedures in Africa 2008
Collaborative Africa Budget Reform Initiative and African Development Bank

Executive Summary [Excerpt]

The Collaborative Africa Budget Reform Initiative (CABRI) is a pan-African network of senior budget officials in ministries of finance and/or planning, created as a platform for its members to share experiences on budget reform programmes and to contribute towards the efficacy of public finance management in Africa.

a) Timeline of the budget process in African countries
Budget timelines depict the duration and sequence of the different stages of the budget process, which are likely to reflect country-specific factors, such as administrative heritage and capacity, the balance of power between the different branches of government, as well as the macro-economic context. The budget process can be divided into four distinct stages: (1) executive (more…)

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Image result for magic moneyThe Simple, Metaphorical Explanation
Patrick Byrne, Mark Mitchell, 2008

When [we] travel to another country, the first thing we do when we land is change some US dollars into the local currency. Perhaps you change enough to get a cab to the hotel, go out and buy a meal, etc. For the duration of your stay you keep changing your dollars into the local currency to get around. Then when you are ready to leave, you take whatever you have left and you convert it back into dollars, or spend it, or give it away, and board the plane back to the United States.

Yet imagine that there are some travelers [who] are allowed to take a small machine that prints out the local currency. If they are in Paris, it prints out Euros. If they are in London, it spits out British Pounds. When in Mexico City, it prints pesos. And so on and so forth. On every trip, however, this special “currency machine” keeps track of how many (more…)

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Image result for fake companySEC warns: Beware of ‘blank check companies’
By Matt Levine, Bloomberg News, Apr 20 2015

A lot of investment scams are pretty simple. You tell someone you’ll invest money for them, they give you money, you steal it, you run away to [Washington DC]. Or, more likely, you fritter the money away day-trading [unregistered] stock because, realistically, criminals [like to gamble]. But the stock market also has a long and charming tradition of needlessly complicated scams, where the basic process — you give me money, I steal it — is dressed up in multiple layers of storytelling designed to prey both on people’s hopes and also on vulnerabilities in regulation.

Here is a fraud case about “undisclosed ‘blank check’ companies,” a popular scheme […]. The background is that if you want to be a public company and sell your shares to regular investors, there are hoops you have to jump through. You have to file a registration statement with the Securities and Exchange Commission, with audited financial statements and a bunch of detail about your business. The SEC will review it and demand revisions to make sure that the registration statement is complete and gives investors sufficient disclosure. It’s an expensive and time-consuming process […]. (more…)

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Blank Check IPOs (SPACS)
From Silicon Investor (2014) [Edited]

Wall Street has never been bashful about recycling old products and concepts. One of the recent concepts to be recycled is the blank check IPO. Blank check companies are also known as Special Purpose Acquisition Companies (SPACS) [or shell companies].

A blank check company is a development stage company that has been formed for no specific purpose other than to complete a merger or acquisition with an operating entity, the identity of which is unknown when the company is formed. Because such transactions generally, but not always, trigger a change of control, with the shareholders of the acquired company now owning more than 50% of the combined entities, the majority of these transactions are accounted for as reverse mergers. (more…)

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The “GDP Fraud”
By Joel Bowman (2009)

If GDP is telling us that the US economy is steadily improving, how come so many folks on Main Street feel so bad? Don’t they read the papers? Don’t they know the GDP is improving?

The short answer to these questions is that the GDP calculation is a fraud…or perhaps it’s a fraud wrapped in a deception.

To understand why the GDP numbers could be so good when the economy all around looks so bad, it is necessary to understand a few pertinent details of the GDP calculation. It is necessary to see just what meat and meat by-products go into this economic sausage.

For one thing, GDP includes government spending…but does not SUBTRACT any of the borrowing the government does to fund its spending. And obviously, government spending is in no way a reflection of private sector economic activity.

Therefore, as Frank Shostak, an adjunct scholar of the Mises Institute, observes, “The GDP framework gives the impression that it is not the activities of individuals that produce goods and services, but something else outside these activities called the ‘economy.’ However, at no stage does the so-called ‘economy’ have a life of its own, independent of individuals. The so-called economy is a metaphor […].” (more…)

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Deja PooEconomic Coup d’Etat: Debt and Deficit as Shock Therapy
By Ismael Hossein-zadeh, November 02, 2013

When Naomi Klein published her ground-breaking book The Shock Doctrine (2007), which compellingly demonstrated how neoliberal policy makers take advantage of overwhelming crisis times to privatize public property and carry out austerity programs, most economists and media pundits scoffed at her arguments as overstating her case. Real world economic developments have since strongly reinforced her views.

Using the unnerving 2008 financial crash, the ensuing long recession and the recurring specter of debt default, the financial oligarchy and their proxies in the governments of core capitalist countries have embarked on an unprecedented economic coup (more…)

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