Initiate Change

[Brentastic]

I'm gonna add one post per day in this thread as a reminder to everyone that we need to initiate change in this country and it starts and ends with the Federal Reserve. All of the crappy laws that limit our freedom (why can't I play poker online legally??) fall under this umbrella too. This parasite affects us all in everything we do. This thread has no business turning into a trainwreck either. This thread is intended to enhance awareness, share truths and promote positive discussion about coming together as a community of people and taking our country back.

 

All of us huddlers have 2 things in common, we love the NFL and we love America (or at least the idea of America as it used to be). We need to stop bickering about strategically placed 'issues' that are disguising the real problem and we need to unite. US against them (elite greedy bankers who make all the laws and control our money). Human nature will continue to alow this "enslaving of the people by means of debt" to continue until we are are forced to kill each other over necessities like food and shelter. WE can be the generation that goes against that grain by initiating change before it gets to that point. It starts with being receptive to new ideas, gaining knowledge and sharing our knowledge with others who are blinded by the perception of this reality. Humans have the blessing of being able to create - and that means we can create our own path ahead. We can create our own evolution as a species through awareness and action. We can evolve from what currently is human nature to what could be.

 

I will end this post with a warning from one of our forefathers. Many of them foretold what is here and what is yet to come. We'd be arrogant and stupid not to listen:

 

We must not let our rulers load us with perpetual debt.

We must make our election between economy and liberty

or profusion and servitude.

If we run into such debt, as that we must be taxed in our meat and

in our drink, in our necessaries and our comforts, in our labors and

our amusements, for our calling and our creeds…

[we will] have no time to think,

no means of calling our miss-managers to account

but be glad to obtain subsistence by hiring ourselves

to rivet their chains on the necks of our fellow-sufferers…

And this is the tendency of all human governments.

A departure from principle in one instance

becomes a precedent for [another ]…

till the bulk of society is reduced to be mere automatons of misery…

And the fore-horse of this frightful team is public debt.

Taxation follows that, and in its train wretchedness and oppression.

 

– Thomas Jefferson

[Avernus]

http://online.wsj.com/article/SB1000142405...sNewsCollection

 

actual article has pics and videos embedded on the side of the article....but here's the text.

 

China Bank Moves to Buy U.S. Branches

 

CHICAGO—China's biggest bank signed an agreement that would make it the first Beijing-controlled financial institution to acquire retail bank branches in the U.S., though regulators could still block the deal.

 

Under the deal, Industrial & Commercial Bank of China Ltd., by some measures the world's largest bank, agreed to acquire a majority stake in Bank of East Asia Ltd.'s U.S. subsidiary. ICBC will pay $140 million for an 80% stake. Bank of East Asia, which is a publicly traded company based in Hong Kong, has a total of 13 branches in New York and California. ICBC and Bank of East Asia have talked to U.S. regulators about the deal, these people said.

 

The move represents what could be the start of big expansions by Chinese financial institutions in the U.S.

 

Signed in Chicago on the last day of Chinese President Hu Jintao's state visit to the U.S., the move, comes as both Beijing and Washington are calling for greater commercial ties between the two countries.

 

Both Beijing and Washington are eager to showcase their willingness to strengthen the business ties between the two countries, despite the many issues that will continue to hinder the relations. China is prodding the U.S. to ease its export controls, especially those involving high-technology products, aimed at its biggest economic rival. The U.S. is asking for more Chinese purchases of made-in-America goods and services.

 

The transaction is expected to be carefully scrutinized by U.S. regulators, including the Committee on Foreign Investment in the U.S., known as CFIUS, because of the state-controlled nature of the Chinese bank. A previous deal by a Chinese bank to acquire a bank in the U.S. was rejected by regulators. "It is going to be a long process," a person familiar with the matter said.

 

If ICBC's deal to acquire Bank of East Asia's U.S. subsidiary goes through, Americans could walk into the retail branches, open check and savings accounts and, most significantly for many investors, open yuan accounts to trade the currency.

 

ICBC, as the bank is known, is based in Beijing and is 70% owned by the Chinese government. It has become increasingly comfortable venturing outside its home markets, which still account for the bulk of its profit. Last year, ICBC got into the broker-dealer business in the U.S. with a symbolic $1 purchase of the U.S. brokerage unit of Fortis Securities, controlled by France's BNP Paribas SA. That deal didn't subject ICBC to tight U.S. regulatory restrictions on foreign purchases of retail-banking operations.

 

U.S. regulators often demand that foreign banks prove they are adequately supervised in their home markets and have proper antimoney-laundering procedures in place before allowing them to set up retail operations, legal experts say.

 

The agreement was signed at the Hilton Chicago as part of a slew of pacts announced by roughly 60 U.S. and Chinese companies at a giant "signing ceremony" organized on Friday by China's Commerce Ministry and its U.S. counterpart.

 

Both Beijing and Washington are eager to showcase their willingness to strengthen the business ties between the two countries, despite the many issues that will continue to hinder the relations. China is prodding the U.S. to ease its export controls, especially those involving high-technology products, aimed at its biggest economic rival while the U.S. is asking for more Chinese purchases of made-in-America goods and services. The contract-signing event in Chicago was hailed as "the most important event" in conjunction with President Hu's visit, according to officials in the Chinese delegation.

 

The move by ICBC underscores the desire by Chinese banking executives to transform their strength into a greater presence globally, as Chinese banks have emerged from the global financial crisis largely unscathed. Their hope is to better support Chinese companies and guard against losing customers to U.S. and European banks that already have networks world-wide. Meantime, Beijing has encouraged Chinese companies to expand overseas in recent years. In light of the huge foreign-exchange reserves China has, Beijing has encouraged its banks to invest more overseas.

 

In a speech at the event Friday, Chen Deming, China's Commerce Minister, said one of the priorities for the Commerce Ministry is to "encourage our companies to go out." He pointed to the vast foreign-exchange reserves held by China, saying that "we should turn those reserves into capital and assets." Otherwise, the reserves could decline in value because of inflation, Mr. Chen said.

 

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While China's resource and construction companies have moved aggressively into new markets, its financial institutions generally have been slow to follow.

 

Bank of East Asia is led by prominent Asian banker Sir David Li. Mr. Li drew unwanted attention to himself in the U.S. and Hong Kong in 2007 when the former board member of Dow Jones became the target of an insider-trading case involving News Corp.'s buyout bid for Dow Jones. Mr. Li later agreed to pay $8.1 million to settle the civil charges. Mr. Li couldn't be reached for comment.

 

So far, most Chinese investments in the U.S. financial sector have involved the Chinese taking passive, minority stakes in firms such as Blackstone Group LP and Morgan Stanley. Taking a majority stake in Bank of East Asia is a change of tactic for ICBC

 

At the same time, Bank of East Asia is no stranger to ICBC. It sold a 70% stake in its Canadian operations to ICBC last year and all of its six branches in Canada have since been rebranded ICBC Canada. Bank of East Asia has 13 branches in the U.S., concentrating in New York and California—two states that boast the largest numbers of Chinese immigrants. The bank formed its U.S. banking subsidiary in 2001 through the acquisition of Grand National Bank, of Alhambra, Calif.

 

The deal, if approved by U.S. regulators, would allow ICBC to gain relatively quick access to American depositors. Right now, ICBC has one branch in New York, but it isn't involved in the retail-banking business. Bank of China Ltd. is the only mainland Chinese bank that has a retail license in the U.S. market. The bank, also state owned, has two branches in New York and one in Los Angeles. It recently has started allowing American customers to buy and sell the Chinese currency through its U.S. branches.

 

The decision by Bank of China is the latest move by China to allow the yuan, whose value is still tightly controlled by the government, to become an international currency that can be used for trade and investment.

 

Chinese banks have encountered uphill battles to gain access to the U.S. market in the past. For instance, it took almost two years for ICBC to get the approval from the Federal Reserve to open its New York branch, which has so far focused on commercial lending. That green light was given shortly before President George W. Bush's trip to Beijing for the Summer Olympics in 2008.

 

Some Chinese banks' bids to acquire U.S. counterparts have been rejected. A case in point is China Minsheng Banking Corp. In 2008, Minsheng, China's first private bank and a midsize lender, agreed to take a 9.9% stake in San Francisco lender UCBH Holdings Inc., the holding company for United Commercial Bank. When the bank ran into trouble during the financial crisis over bad loans and accounting errors, Minsheng tried to buy it. U.S. regulators rejected the move because of restrictions on foreign investment in U.S. banks, according to people familiar with the matter. Regulators in late 2009 shut down United Commercial Bank and Minsheng had to write off its $130 million investment

[Avernus]

I don't want to keep posting just articles, but this one here is a must read for all.

 

Accounting tweak could save Fed from losses

 

By Pedro Nicolaci da Costa

 

WASHINGTON | Fri Jan 21, 2011 3:47pm EST

(Reuters) - Concerns that the Federal Reserve could suffer losses on its massive bond holdings may have driven the central bank to adopt a little-noticed accounting change with huge implications: it makes insolvency much less likely.

 

The significant shift was tucked quietly into the Fed's weekly report on its balance sheet and phrased in such technical terms that it was not even reported by financial media when originally announced on January 6.

 

But the new rules have slowly begun to catch the attention of market analysts. Many are at once surprised that the Fed can set its own guidelines, and also relieved that the remote but dangerous possibility that the world's most powerful central bank might need to ask the U.S. Treasury or its member banks for money is now more likely to be averted.

 

"Could the Fed go broke? The answer to this question was 'Yes,' but is now 'No,'" said Raymond Stone, managing director at Stone & McCarthy in Princeton, New Jersey. "An accounting methodology change at the central bank will allow the Fed to incur losses, even substantial losses, without eroding its capital."

 

The change essentially allows the Fed to denote losses by the various regional reserve banks that make up the Fed system as a liability to the Treasury rather than a hit to its capital. It would then simply direct future profits from Fed operations toward that liability.

 

This enhances transparency by providing clearer, more frequent, snapshots of the central bank's finances, analysts say. The bonus: the number can now turn negative without affecting the central bank's underlying financial condition.

 

"Any future losses the Fed may incur will now show up as a negative liability as opposed to a reduction in Fed capital, thereby making a negative capital situation technically impossible," said Brian Smedley, a rates strategist at Bank of America-Merrill Lynch and a former New York Fed staffer.

 

"The timing of the change is not coincidental, as politicians and market participants alike have expressed concerns since the announcement (of a second round of asset buys) about the possibility of Fed 'insolvency' in a scenario where interest rates rise significantly," Smedley and his colleague Priya Misra wrote in a research note.

 

STALE RISK

 

In response to the worst financial crisis and recession since the Great Depression, the U.S. central bank pulled out all the stops on monetary policy. It not only slashed interest rates effectively to zero, but also committed to buy some $2.3 trillion in Treasury and mortgage securities in order to keep long-term borrowing costs down.

 

For weeks now, worries had been percolating among investors about the possibility that the central bank might run into trouble when it eventually decides to unwind some of those extraordinary measures. For more, see: [iD:nN1080075]

 

In particular, analysts feared the Fed might be forced to sell either its Treasury or mortgage-backed securities at a steep loss in a rising interest rate environment, or end up having to pay a higher interest rate on bank reserves than it receives on the securities it holds.

 

Fed Chairman Ben Bernanke, asked about the possibility in congressional testimony earlier this month, said even the most extreme circumstances would not have very large implications.

 

"Under a scenario in which short-term interest rates rise very significantly, it's possible that there might come a period where we don't remit anything to the Treasury for a couple of years. That would be I think a worst-case scenario," Bernanke said.

 

However, the Fed has tended to assume that interest rates would be rising sharply only if the economy were recovering very rapidly. Fed policymakers seem to be ignoring the possibility that the country could face a bout of so-called stagflation -- a period of high inflation with depressed economic activity like that seen during the 1970s.

 

what's a loophole?

The Board's H.4.1 statistical release, "Factors Affecting Reserve Balances of Depository Institutions and Condition Statement of Federal Reserve Banks," has been modified to reflect an accounting policy change that will result in a more transparent presentation of each Federal Reserve Bank's capital accounts and distribution of residual earnings to the U.S. Treasury. Although the accounting policy change does not affect the amount of residual earnings that the Federal Reserve Banks distribute to the U.S. Treasury, it may affect the timing of the distributions. Consistent with long-standing policy of the Board of Governors, the residual earnings of each Federal Reserve Bank, after providing for the costs of operations, payment of dividends, and the amount necessary to equate surplus with capital paid-in, are distributed weekly to the U.S. Treasury. The distribution of residual earnings to the U.S. Treasury is made in accordance with the Board of Governor's authority to levy an interest charge on the Federal Reserve Banks based on the amount of each Federal Reserve Bank's outstanding Federal Reserve notes.

 

Effective January 1, 2011, as a result of the accounting policy change, on a daily basis each Federal Reserve Bank will adjust the balance in its surplus account to equate surplus with capital paid-in and, in addition, will adjust its liability for the distribution of residual earnings to the U.S. Treasury. Previously these adjustments were made only at year-end. Adjusting the surplus account balance and the liability for the distribution of residual earnings to the U.S. Treasury is consistent with the existing requirement for daily accrual of many other items that appear in the Board's H.4.1 statistical release. The liability for the distribution of residual earnings to the U.S. Treasury will be reported as "Interest on Federal Reserve notes due to U.S. Treasury" on table 10. Previously, the amount necessary to equate surplus with capital paid-in and the amount of the liability for the distribution of residual earnings to the U.S. Treasury were included in "Other capital accounts" in table 9 and in "Other capital" in table 10.

 

also another great link http://www.federalreserve.gov/releases/h41/Current/

[SEC=UGA]

Just a note to people when it does finally come to people killing each other for food and shelter. I have big guns and am pretty proficient with them. Put me a little ways down the list, you should probably start your hunting for food and shelter in the Briarcliff, VA Highlands, and Decatur area of Atlanta where people are much less likely to be armed.

 

Just wanted to give potential interlopers a heads up.

 

With regard to the article on China Banks buying up US banks, yeah, we might want to block that move.

 

With regard to the banking elite, they really don't want the country to fall into disarray as you describe. They have to live here, too and continue to profit in order to maintain their lifestyle. But if it does hit the fan, I will have been in Turkey for a few years before it hits... Mmmmm, Iskender kebab ve cupra...

[redrumjuice]

It's already to late for us. See you on the other side.

[Ursa Majoris]

With regard to the article on China Banks buying up US banks, yeah, we might want to block that move.

Why? I ask because the US has similar holdings all over the world.

[Brentastic]

4 posts and no flames

 

Avernus, that's a good article about the Fed's new accounting change. I read that last night and I think that's what actually prompted me to start this thread.

 

SEC=UGA, noted - I will meet you down in Atlanta. Look for the yarn beard. However, regarding the banking elite, they do not care about America. They are foreign cartel. In another thread I mentioned how I'm compiling a list of the actual owners of our currency (owner of the Federal Reserve) and I found that the Royal Bank of Scotland is the top holder of the Federal Reserve Bank of Boston. Trust me, the guys pulling the strings don't care about America. In fact they hate America because they are old European banking cartels. That's why all the gold that used to be in fort knox is now in Europe. They are intentionally raping us and leaving us bare.

[SEC=UGA]

Why? I ask because the US has similar holdings all over the world.

 

Chinese banks are state controlled entities.

[Brentastic]

Why? I ask because the US has similar holdings all over the world.

Right, that's because the Fed pulls the strings and they are doing it now in China. The perception that the China banks are government controlled is an illusion just like it is here with the Fed. These bankers have an established system for moving losses from themselves to the productive people of nations (you and me) and the boundaries are international. How is it that you and I get stuck paying for all this debt? Because they created the system and they are abusing their power. If Americans were calling the shots, this would not be happening. But it's the international bankers calling the shots and we're just taking it because everyone thinks they are a Federal entity who's duty is to serve the American people. This is not the case however, which is why we need to stand up and take our country back.

[Brentastic]

Chinese banks are state controlled entities.

See above^^^^^^^^^^

[Avernus]

Why? I ask because the US has similar holdings all over the world.

 

because we know what kind of a cancer a foreign presence like that would hold....

[Ursa Majoris]

Chinese banks are state controlled entities.

Perhaps. I think less and less so as time goes by.

[Ursa Majoris]

because we know what kind of a cancer a foreign presence like that would hold....

Isn't that exactly the opinion that people in foreign countries have of US banks doing business on their turf? I'm not trying to stir things up, just interested in why it's considered such a big deal when foreign companies have holdings here (and, on a side note, therefore spend money here) yet when we have holdings there, that's regular business.

[Big Country]

Just to clarify one minor error in your initial post, other than in the state of Washington (and perhaps a couple others, possibly Kentucky IIRC), it is not illegal for you to play online poker, it is illegal for US based financial institutions to process transactions that could possibly be funding illegal accounts used for gambling. Poker is not illegal, but sports betting, etc. are, and the UIGEA was written so ambiguously that banks basically decided to just disallow any transaction to any possible place of gambling including those which are technically legal, such as poker.

[Brentastic]

Just to clarify one minor error in your initial post, other than in the state of Washington (and perhaps a couple others, possibly Kentucky IIRC), it is not illegal for you to play online poker, it is illegal for US based financial institutions to process transactions that could possibly be funding illegal accounts used for gambling. Poker is not illegal, but sports betting, etc. are, and the UIGEA was written so ambiguously that banks basically decided to just disallow any transaction to any possible place of gambling including those which are technically legal, such as poker.

Sure. That was one tiny example that just happened to be in my head, there are a million others. My point still stands.

[jetsfan]

"An accounting methodology change at the central bank will allow the Fed to incur losses, even substantial losses, without eroding its capital."

 

Nice!!!! I am so doing this. Any and all debt I now have is no longer tied to my capital, but to my future profits. Awesome!!!!

[Avernus]

Isn't that exactly the opinion that people in foreign countries have of US banks doing business on their turf? I'm not trying to stir things up, just interested in why it's considered such a big deal when foreign companies have holdings here (and, on a side note, therefore spend money here) yet when we have holdings there, that's regular business.

 

 

that's exactly my point....I don't believe in our foreign presence bringing anything good,....and this goes for any country...

[isleseeya]

that's exactly my point....I don't believe in our foreign presence bringing anything good,....and this goes for any country...

 

our foreign presence is massive in very many sectors ...whether its business , banking , military , etc

 

And it has been for one heck of a long time ...It has benefited us immensely in many ways , and at times hurt us but it will go on and in many cases its necessary

[Ursa Majoris]

that's exactly my point....I don't believe in our foreign presence bringing anything good,....and this goes for any country...

So you'd disallow any and all transnational firms?

[Avernus]

So you'd disallow any and all transnational firms?

 

 

it depends on what the presence is there for....I wouldn't want to get on China's turf in the banking sector....

 

we have no business being over there for that...

 

it depends on the reason or purpose....

[Avernus]

our foreign presence is massive in very many sectors ...whether its business , banking , military , etc

 

And it has been for one heck of a long time ...It has benefited us immensely in many ways , and at times hurt us but it will go on and in many cases its necessary

 

I disagree with our banking and military presence being elsewhere...nobody else has their presence here (to my knowledge - which is a good thing if there actually is one)

 

business is good, but military and banking presence is negative in the longterm....imo anyways

[Duchess Jack]

Just a note to people when it does finally come to people killing each other for food and shelter. I get horny when I am hungry and leave my door unlocked at all times

 

fixed

[SEC=UGA]

fixed

 

You complete me...

 

I thought Brent was supposed to post in here everyday to remind us of what was going on... I"M WAITING!!!!

[Brentastic]

Quote from 9th Circuit Court

 

 

"... we conclude that the [Federal] Reserve Banks are not federal ...

but are independent privately owned and locally controlled corporations...

without day to day direction from the federal government."

 

Source: Lewis vs United States, June 24, 1982

[Brentastic]

If anyone has some time you should read the first two articles and discuss which view makes sense to you in order to sustain a healthy long-lasting economy. The first article is written by the most famous living American and Keynesian theory economist, the Nobel laureate, Paul Krugman. The second article is written by an Austrian School Economist named Robert Murphy. Articles are listed in chronological order:

 

http://www.slate.com/id/1937/

http://mises.org/daily/3155

 

If you wanted to dedicate more time to understanding the difference between these two men's thoughts, you should read both men's rebuttals toward the other. Again in order (these were both written within the last week):

 

http://krugman.blogs.nytimes.com/2011/01/1...leaps-backward/

http://mises.org/daily/4993