How banks prepared for default

~ susie

It’s kind of crazy, isn’t it, that we’re even talking about this? I wonder if people will vote for these teabaggers again.

NEW YORK (Reuters) – As the United States threatened to default on its debt last month, major U.S. banks set up war rooms, spent many millions of dollars on contingency planning and, in some cases, even prepared to underwrite federal government benefits.

In a series of interviews with top bank executives, new details emerged about the extent of the contingency planning that was undertaken before and during the 16-day government shutdown and as a potential default loomed.

The planning for worst-case scenarios didn’t come cheap. JPMorgan alone has spent more than $100 million on contingency planning for U.S. budget crises in recent years including this one, sources close to the bank say. It has reviewed and analyzed thousands of trading contracts, updated computer systems to handle fiscal emergencies, hired consultants, and built new models to figure out what might happen to securities prices.

It may not go to waste. The temporary budget agreement that President Barack Obama signed shortly after midnight on October 17 to end the shutdown and lift the default threat, authorizes government spending through January 15 and eases enforcement of the debt limit until February 7, creating the potential for another budget crisis early next year, even as some Republicans vow they will avoid it.

Maggie Thatcher’s dream comes true

~ susie ~ 4 Comments
"Let them die, then, and decrease the surplus population!"
“Let them die, then, and decrease the surplus population!”

I imagine we have the same problem here, but since we don’t have a National Health Service, those starving kids don’t go to the hospital. Problem solved!

Spiralling numbers of admissions to hospitals in Leeds of patients with malnutrition have been branded “an absolute disgrace”.

But the figures – which have trebled in five years – could be the tip of the iceberg, a politician has warned.

People with malnutrition needed hospital care on 93 occasions last year, compared with 30 in 2008.

Coun Lisa Mulherin, executive board member for health and wellbeing on Leeds City Council, said: “The numbers being admitted to hospital are shocking and potentially the tip of the iceberg.

“It’s an absolute disgrace that in a wealthy, modern nation we are seeing anybody turning up in hospital in that condition, but the fact we are seeing three times as many now tells us something about the changes to the welfare system, wage stagnation and the way fuel prices have gone up out of all proportion with people’s pay.

“The pressures on ordinary working families in this city are enormous.”

Reasons for the increase include poverty, which can prevent people buying nutritious food, the growing number of older people – many of whom are living in ill-health, as well as greater recognition of the issue by health workers.

A year ago it was revealed that more than 27,000 people in Leeds were suffering from malnutrition, which occurs when the body does not get the nutrients it needs.

Coun Mulherin said they knew a lack of cash meant families in Leeds were being forced to choose between eating or heating their homes.

She said the council was committed to tackling malnutrition, including through its backing of the Leeds Food Consensus, a drive to combat the problem.

A city-wide campaign was launched earlier this year to let older people know the warning signs, frontline health workers have been trained to look out for the condition while they are working with food banks to enable people using them to find out where they can get other help.

The head of a team which works to prevent malnutrition in the city said she was not surprised by the figures – and agreed that financial pressures seemed to be worsening.

‘Quit complaining’

~ susie ~ 2 Comments

Again: If you normally go there, don’t boycott unless it’s related to a job action by the employees, because these folks really need these jobs. But do make a point of telling the manager, “I avoid coming here because you don’t pay a living wage. It makes me feel bad when I spend my money here.”

McDonald’s McResource Line, a dedicated website run by the world’s largest fast-food chain to provide its 1.8 million employees with financial and health-related tips, offers a full page of advice for “Digging Out From Holiday Debt.” Among their helpful holiday tips: “Selling some of your unwanted possessions on eBay or Craigslist could bring in some quick cash.”

Elsewhere on the site, McDonald’s encourages its employees to break apart food when they eat meals, as “breaking food into pieces often results in eating less and still feeling full.” And if they are struggling to stock their shelves with food in the first place, the company offers assistance for workers applying for food stamps.

McDonald’s corporate officers have a history of offering questionable advice to their low-wage workers. Four months ago, the company partnered with Visa to distribute a sample “budget.” In it, the chain suggested that workers needn’t pay for such frivolous expenses like their heating bills, and factored in a monthly rent of $600. To workers living in New York City (home of 350+ stores) and other expensive metropolises, that number is almost comical.

McDonald’s employees are some of the most underpaid workers in the country. The company’s cashiers and “team members” earn, on average, $7.75 an hour, just 50 cents higher than the federal minimum wage. Responding to rising living costs, many stores have staged walk-outs, strikes and protests, demanding a living wage. In Europe, where the minimum wage for employees is $12, customers pay just pennies more than their American counterparts for the same menu items, while the stores themselves typically bring in higher profit margins than ones in the United States.

Of course, McDonalds has shown little willingness to negotiate higher salaries for their poorest workers even as labor rights groups up the pressure. Instead, their website has another piece of advice for people who are stressed about their meager paychecks: “Quit complaining,” the site suggests. “Stress hormones levels rise by 15% after 10 minutes of complaining.”

CEOs seeking to slash Social Security

~ susie ~ 2 Comments
CEOs Seeking to Slash Social Security Stumble Over Their Own Hypocrisy (via Moyers & Company)

Billionaire Pete Peterson once thought it would be a good idea to make rich CEOs the public face of his long-standing campaign to slash Social Security. Guys like Lloyd Blankfein of Goldman Sachs and GE’s Jeffrey Immelt have indeed won many a battle…

Continue reading “CEOs seeking to slash Social Security” →