Bankers Own the World; And are ultimately destroying it

25/07/2013 00:23

Source: Chris Martenson



In every era, there are certain people and institutions that are held in the highest public regard as they embody the prevailing values of society. Not that long ago, Albert Einstein was a major public figure and was widely revered. Can you name a scientist that commands a similar presence today?
Today, some of the most celebrated individuals and institutions are ensconced within the financial industry; in banks, hedge funds, and private equity firms. Which is odd because none of these firms or individuals actuallymake anything, which society might point to as additive to our living standards. Instead, these financial magicians harvest value from the rest of society that has to work hard to produce real things of real value.
While the work they do is quite sophisticated and takes a lot of skill, very few of these firms direct capital to new efforts, new products, and new innovations. Instead they either trade in the secondary markets for equities, bonds, derivatives, and the like, which perform the 'service' of moving paper from one location to another while generating 'profits.' Or, in the case of banks, they create money out of thin air and lend it out – at interest of course.

Banking was conceived in iniquity and was born in sin. The bankers own the earth. Take it away from them, but leave them the power to create money, and with the flick of the pen they will create enough deposits to buy it back again. However, take away from them the power to create money, and all the great fortunes like mine will disappear, and they ought to disappear, for this would be a happier and better world to live in. But, if you wish to remain the slaves of bankers and pay the cost of your own slavery, let them continue to create money.

~ Josiah Stamp – Bank of England Chairman, 1920

Because these institutions and individuals accumulate vast sums of money for their less-than-back-breaking efforts, they are well respected if not idolized by most. Many of the most successful paper-accumulators are household names. They get invited to the best parties, are lured by major networks to appear on their shows, speak at the biggest conferences, and their views and words find an easy path to the ears of millions.
But this is more than just an idle set of observations for the curious. It's actually a critically important phenomenon to be aware of. For the current configuration of financially powerful entities has, at the tail end of a decades-long debt-based money experiment, achieved an astonishing concentration of power, money, and influence.

We raise this topic because our work centers on changing the conversation towards the things that really matter while there is still time to engineer a better outcome, and that requires illuminating the status quo and having a conversation about whether it needs to be modified. Unfortunately, those at the center of the status quo are not at all interested in having any such conversation, because all of their accumulated power depends on maintaining things as they are.
Money is power.

And history has shown that power is never ceded spontaneously or willingly.

The Network That Runs the World

A couple of years ago, I came across a study that has stuck with me ever since and I want to share it with you. It's really important if we want to understand the likelihood of a graceful transition for our current society into a future of prosperity.
Unlike prior studies seeking to quantify the degree of concentration of wealth and influence, this study simply pored through all of the available public data to build an empirical map of the network of power. Its findings are quite startling and deserve a bit of pondering:

Revealed – the capitalist network that runs the world

Oct 2011

AS PROTESTS against financial power sweep the world this week, science may have confirmed the protesters' worst fears. An analysis of the relationships between 43,000 transnational corporations (TNCs) has identified a relatively small group of companies, mainly banks, withdisproportionate power over the global economy.

(...)

Previous studies have found that a few TNCs own large chunks of the world's economy, but they included only a limited number of companies and omitted indirect ownerships, so could not say how this affected the global economy - whether it made it more or less stable, for instance.

The Zurich team can. From Orbis 2007, a database listing 37 million companies and investors worldwide, they pulled out all 43,060 TNCs and the share ownerships linking them. Then theyconstructed a model of which companies controlled others through shareholding networks, coupled with each company's operating revenues, to map the structure of economic power.

The work, to be published in PLoS One, revealed a core of 1318 companies with interlocking ownerships (see image). Each of the 1318 had ties to two or more other companies, and on average they were connected to 20.

What's more, although they represented 20 per cent of global operating revenues, the 1318 appeared to collectively own through their shares the majority of the world's large blue chip and manufacturing firms - the "real" economy - representing a further 60 per cent of global revenues.

When the team further untangled the web of ownership, it found much of it tracked back to a"super-entity" of 147 even more tightly knit companies - all of their ownership was held by other members of the super-entity - that controlled 40 per cent of the total wealth in the network. "In effect, less than 1 per cent of the companies were able to control 40 per cent of the entire network," says Glattfelder. Most were financial institutions. The top 20 included Barclays Bank, JPMorgan Chase & Co, and The Goldman Sachs Group.

Just 147 companies control over 40% of the wealth of the entire network of companies. It should be pointed out that such a network does not have any borders and operates on a global basis, meaning that regional analyses –such as how Germany compares with the U.S. – might be less relevant than typically portrayed.

After all, if decisions being made by a tightly knit group of companies are being made to benefit a network that has no borders, then actions by the German or U.S. governments are only a part of the story. And perhaps a minor one, compared to those made the entities that actually control the real wealth of each nation.
It wasn't that many decades ago that a list of the top companies with the most wealth and influence would have been dominated by companies that produced real, tangible products – that is, those that created wealth by adding value to goods by transforming resources into products. Companies like GE, GM, IBM, Exxon, and other industrial giants would have been the wealthiest, because, well, they create actual wealth.

Today the top fifty companies in the 'super-entity' list of 147 from the above study is concerning. Out of the fifty, 17 are banks, 31 are an assortment of investment, insurance, and financial services companies, and only 2 are non-financial companies (Walmart and China Petrochemical)

The top 50 of the 147 superconnected companies

1. Barclays plc

2. Capital Group Companies Inc (Investment Management)

3. FMR Corporation (Financial Services)

4. AXA (Investments & Life Insurance)

5. State Street Corporation (Investment Management)

6. JP Morgan Chase & Co (Bank)

7. Legal & General Group plc (Investments & Life Insurance)

8. Vanguard Group Inc (Investment Management)

9. UBS AG (Bank)

10. Merrill Lynch & Co Inc (Bank)

11. Wellington Management Co LLP (Investment Management)

12. Deutsche Bank AG (Bank)

13. Franklin Resources Inc (Investment Management)

14. Credit Suisse Group (Bank)

15. Walton Enterprises LLC

16. Bank of New York Mellon Corp (Bank)

17. Natixis (Investment Management)

18. Goldman Sachs Group Inc (Bank)

19. T Rowe Price Group Inc (Investment Management)

20. Legg Mason Inc (Investment Management)

21. Morgan Stanley (Bank)

22. Mitsubishi UFJ Financial Group Inc (Bank)

23. Northern Trust Corporation (Investment Management)

24. Société Générale (Bank)

25. Bank of America Corporation (Bank)

26. Lloyds TSB Group plc (Bank)

27. Invesco plc (Investment mgmt) 28. Allianz SE 29. TIAA (Investments & Insurance)

30. Old Mutual Public Limited Company (Investments & Insurance)

31. Aviva plc (Insurance)

32. Schroders plc (Investment Management)

33. Dodge & Cox (Investment Management)

34. Lehman Brothers Holdings Inc* (Bank)

35. Sun Life Financial Inc (Investments & Insurance)

36. Standard Life plc (Investments & Insurance)

37. CNCE

38. Nomura Holdings Inc (Investments and Financial Services)

39. The Depository Trust Company (Securities Depository)

40. Massachusetts Mutual Life Insurance

41. ING Groep NV (Bank, Investments & Insurance)

42. Brandes Investment Partners LP (Financial Services)

43. Unicredito Italiano SPA (Bank)

44. Deposit Insurance Corporation of Japan (Owns a lot of banks' shares in Japan)

45. Vereniging Aegon (Investments & Insurance)

46. BNP Paribas (Bank)

47. Affiliated Managers Group Inc (Owns stakes in 27 money management firms)

48. Resona Holdings Inc (Banking Group in Japan)

49. Capital Group International Inc (Investments and Financial Services)

50. China Petrochemical Group Company

(Source)

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