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Generational Dynamics Web Log for 30-Oct-2012
30-Oct-12 World View -- Banksters desperately seek to save Europe's carbon trading system

Web Log - October, 2012

30-Oct-12 World View -- Banksters desperately seek to save Europe's carbon trading system

Poor health and draft-dodging plague Russia's army

This morning's key headlines from

Banksters desperately seek to save Europe's carbon trading system

Smokestacks in China
Smokestacks in China

The plan that was supposed to save the world from climate change disaster, Europe's Emissions Trading System (ETS), which allows companies to pay for carbon credits that permit the company to emit carbon, is close to collapse. The whole program was poorly designed in the first place by climate change fanatics, and Europe's financial crisis has made carbon credits so cheap that no one has any real incentive to cut back, even if they wanted to.

I've taken no position on whether climate change is occurring or whether human beings caused it. Some people claim it's "proven science," but I've read other articles that claim that global warming ended ten years ago, and that as the Arctic has gotten warmer, the Antarctic has gotten equivalently colder. I also take note of the fact that climate change fanatics never mention the Antarctic.

Whether global warming is occurring or not, or whether humans caused it or not, is irrelevant to the discussion. There is no technology on the horizon that's going to reduce carbon emissions. It's just a scam. Americans and Europeans will not give up their cars, China will not give up its massively growing collection of coal mines, and hundreds of millions of Africans and Indians will not give up cooking with their carbon-emitting charcoal stoves.

Basically, the climate change fanatics are like someone who, a century ago, was worried that the world was going to be covered with horse crap, and horse crap credits should be traded to eliminate the problem. The automobile came along to solve the horse crap problem, and it would have come along with or without horse crap credits.

I wrote about this subject in December 2007 ( "UN Climate Change conference appears to be ending in farce")

At that time, I wrote a lengthy profile about a bankster named Louis Redshaw, head of environmental trading at Barclay's Bank. This was just after the global credit crunch had begun, and the subprime real estate market was crashing. I quoted Redshaw at the time as saying that carbon credit derivatives were going to make banks a lot more money than the subprime mortgage derivatives had. Even in 2007, it was pretty obvious that climate change was a financial scam, and that the people driving it were banksters like Redshaw, and wealthy carbon emitters like Al Gore and the people lounging in air-conditioned conference rooms in Bali, attending a climate change conference. It was all pretty sickening then, but it's even more sickening now.

I quoted an article as saying:

"Fans reckon trading volumes will soon be worth many billions of pounds per year. James Cameron at the investment boutique Climate Change Capital said: I think this is likely to get bigger than the interest-rate-swaps market within 10 to 15 years, particularly once America joins in. ...

Louis Redshaw at Barclays Capital said: We were the first British bank involved and are now the biggest banking participant. We handle transactions that are many multiples of the standard market size of 10,000 tonnes. A million-tonne transaction is not out of the question."

Now we can connect a couple of dots to see how sickening this all is.

Interest-rate swaps are a market with over $300 trillion dollars in synthetic security assets. Cameron and Redshaw want to create a carbon trading market that was bigger than that.

BUT, we learned a few months ago that Barclays bank was at the heart of a scheme, from 2004-2008, to manipulate Libor interest rates, and this affects the values of interest rate swaps. (See "17-Jul-12 World View -- Barclay's COO admits having rigged Libor, thought it was OK" from July.)

So at the time that banksters like Redshaw at Barclays were planning to use carbon trading to create a market bigger than interest rate swaps, the rigging of interest rate swaps was at its peak, and the banksters at Barclays would have known this. They knew that Barclays bank was already defrauding the public by using Libor to manipulate the prices of interest rates swaps, and they almost assuredly were dreaming up a similar scheme to defraud the public using synthetic securities based on carbon credits.

This is why I keep saying: The same Generation-X banksters that caused the financial crisis are still in the same jobs, finding new ways to defraud people, and Generation-X prosecutors refuse to investigate and prosecute other Gen-Xers, even for obvious crimes. After all these years, not a single bankster has gone to jail for the financial crisis, even though the evidence of massive, purposeful fraud is abundant. These leaves the banksters free to create new and bigger frauds, secure in the knowledge that they won't be prosecuted.

So, the European politicians and banksters are now looking for ways to salvage the collapsing Emissions Trading System (ETS), and they plan to do it with harsh new emission control regulations that will stifle business further, at a time when Europe's economy is collapsing. Does everyone understand why I call these people idiots? Spiegel

Libor-rigging banks face rash of lawsuits

In a case coming to court in London on Monday, Guardian Care Homes is claiming that they were defrauded by Barclays Bank, when the bank sold Guardian interest rate swaps during the credit bubble. Interest rate swaps are like insurance policies that pay off if interest rates go too far up or down. They're used by companies that want to protect themselves from losing money if that happens. Interest rates swaps are priced by an algorithm that includes the Libor rate, and Barclays bank admitted in July that it had fraudulently manipulated the Libor rate from 2004-2008 for its own gain. (See "17-Jul-12 World View -- Barclay's COO admits having rigged Libor, thought it was OK" from July.) Guardian is suing Barclays for 12 million pounds, claiming that it lost that much money from Barclays' Libor rigging. There are $300 trillion in interest rate swap contracts in portfolios around the world, and some experts claim that $230 trillion of those swaps were tied to Libor. All of those contracts are suspect because of Libor rigging by Barclays and 16 other banks. Other lawsuits are still in the planning stages, and some estimates are that banks will pay $6 billion in damages collectively. But the fallout goes beyond litigation costs. London's banks in particular have had to set aside billions of pounds to cover potential customer claims, and London's reputation has been severely damaged as a world financial center. Bloomberg

Japan's economy may be in an inescapable decline

With Japan's economy continuing to worsen, mainstream economists are increasingly accepting the belief that Japan is not just in a prolonged slump but also in an inescapable decline. Frankly, I hadn't expected this. Japan had a generational stock market and real estate crash in 1990, following a huge bubble throughout the 1980s, and I would have thought that by this time Japan would have recovered from it. (See "Japan's real estate crash may finally end after 16 years" from 2007.)

But maybe I should have expected this result. After all, America's stock market crash began in 1929, and there was no full recovery until the early 1950s -- at least partially because of World War II. So perhaps a country can't recover from a generational financial crisis without a generational crisis war. At any rate, Japan has the highest amount of debt of any country in the world in relation to GDP -- public debt is 229% of GDP. For comparison, Greece is ranked second at 163%, and the United States is at 103%. And Japan is headed for a major war with China. Washington Post

Poor health and draft-dodging plague Russia's army

20-60% of Russia's teenagers, male and female, are unfit for military duty because of reproductive illnesses, stemming from harmful habits, abortions, serious illnesses, and communicable diseases. This is one of the reasons being blamed for the failure of a four-year program to modernize Russia's armed forces. As a result, Russia is being forced to draft people as old as 27 years. Even so, large scale draft-dodging among the recruitment pool means that the army is far from its staffing goals, with the "permanent readiness" brigades may be undermanned by at least 30 percent. Jamestown and Healthy Russian Foundation

(Comments: For reader comments, questions and discussion, see the 30-Oct-12 World View -- Banksters desperately seek to save Europe's carbon trading system thread of the Generational Dynamics forum. Comments may be posted anonymously.) (30-Oct-2012) Permanent Link
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