Monday, January 02, 2012
My brother started me on listening to Dylan Ratigan about six months ago. I haven’t made up my mind about him (Dylan) yet. I think we’ve had this discussion before. I’m slow.
First it was his TV show on MSNBC. Mr. Ratigan is a little over the top. Okay, he can be a lot over the top at times. And I don’t enjoy watching TV that much. But I do like being outdoors and I listen to podcasts while I’m waiting for the sun to rise or cutting the grass. And I do occasionally run out of things to listen to. Enter Dylan Ratigan’s podcast -- Radio Free Dylan.
All this is so that you have a little background on the most extraordinary exchange I heard on his program yesterday. (It aired on December 12. I say again, I’m slow.)
Yves Smith on How Banks Extract from the Economy
”Big Banks are extracting capital for themselves with such power that investors are actually afraid to go to the courts for redress.
Yves said that one prominent securities lawyer told her “he knows investors who he said if Jamie Dimon came into somebody’s house and killed the children of these people, he said they would be afraid to call the police.” ”
I listened to the podcast and Yves Smith did say that -- with even more passion than Dylan Ratigan (if that’s possible.) Yves Smith is the publisher of Naked Capitalism. And, if you don’t already know, Jamie Dimon is President/CEO of JP Morgan/Chase -- the largest bank/broker/hedge fund/financial monster in America.
Just what kind of rabbit hole have we fallen into here, Alice? Have we become an over-sized banana republic where oligarchs rule by fear and intimidation? Or has journalism as we know it died? Dylan Ratigan is indeed “over the top” but his previous guest was Gretchen Morgenson from The New York Times and I didn’t notice her turning up her nose at Mr. Ratigan. And you don’t get any more “mainstream” than The New York Times. Besides, look at this exchange with Yves Smith. It fits with what I believe has been going on.
”YVES:...I mean one of the classic examples is infrastructure deals. I mean, fortunately, those are beginning to get a bit of a bad name. But, you know, you will have a government that owns some sort of asset like the classic example was the Chicago parking meter deals where they get revenues from it and because they are a bit broke, they decide that they are going to sell the family china when they are still going to have to rent it back and use it.
And what happens is that these investors will – they have so many fees in these deals, there are multiple fees. I mean I could go through it, but basically not only do the investors want to earn a return in the 15% to 20% range, but then you also have a lot of fees in putting together the deals because they are extremely complicated.
YVES: And there is a fee for managing the asset on top of that. And the deals are set up to be a heads I win, tails you lose kind of deals where, for example, in Chicago if they clean the streets, they have to pay the parking meter consortium for the loss of revenues. And they have jacked up the parking charges so much that its hurting local merchants. So you know – and literally in the case of the Chicago meter deal, they marketed to investors at twice the price they paid the city because they knew they are going to ramp – they planned to ramp their fees aggressively.”
Remember how I’ve been warning you about letting the government privatize ATC and create la “toll booth” in the sky?
If you have the time, you might want to listen to this episode of Science Friday with Ira Flato. There are two thoughts in it that helped form this blog.
1) The guests mention that we’re not hearing anything else about the nuclear meltdown at Fukushima because the major news organizations don’t have the budget to cover long-term events like this anymore.
2) The guest panel of scientists bemoan the fact that the political reporters won’t take on the Republican Presidential candidates about their anti-science positions. Specifically about global warming.
I hope you are reaching the conclusion that we should be concerned about the “corporatization” of the media also.
January 2, 2011