The Australian Alert Service is the weekly publication of the Citizens Electoral Council of Australia.
It will keep you updated of strategic events both in Australia, and worldwide, as well as the organising activities of the CEC.
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In this week's Australian Alert Service
19 September 2018
Did the can kicked in 2008 stop in 2018?
The tenth anniversary of the 15 September 2008 collapse
of Lehman Brothers brought renewed warnings of
another global crash, and admissions of just how close
Australia came to a full-scale banking collapse. While
still claiming we "successfully navigated the GFC", thenPM
Kevin Rudd revealed that Treasury worked on contingency
plans for six months prior to the Lehman bankruptcy,
following the bailout of Bear Stearns. The Council of
Economic Regulators, comprising Treasury, the Reserve
Bank, the Australian Prudential Regulation Authority and
the Australian Securities and Investments Commission, put
together a "Memorandum of Understanding on Financial
Distress Management" to map out the regulators' various
roles and responsibilities for keeping banks afloat.
"We feared a run on the banks as the global contagion
set in", Rudd admitted in a 13 September Australian Financial
Review article, going on to brag about how his government's
reaction saved the nation from crisis.
But it did not; it kicked the can down the road, and we
now have something far worse to deal with.
Rudd's policy director, Pradeep Philip, has also spoken
out about the war-gaming for financial disaster that went on
in those months of 2008. Extreme scenarios were played
out, such as "What if there was sovereign default, a country
went bust?" Without the bailout by the US Federal Reserve,
Philip said, "the banking system would have been
insolvent". He indicated it could all happen again given
the dangerous, much higher levels of US corporate debt.
On 16 September, Martin Feldstein, President of the US
National Bureau of Economic Research and former chairman
of the White House Council of Economic Advisors
under Ronald Reagan, warned the Daily Telegraph that
the next bear market could set off a $10 trillion crash of
US household assets. "When the next recession comes, it
is going to be deeper and last longer than in the past. We
don't have any strategy to deal with it", he said. Describing
a scenario not seen in the post-War era, he said the
USA is entering uncharted and perilous waters.
In the UK, where the prospect for a Western government
committed to serious financial reform is highest, former Labour
Prime Minister Gordon Brown told the Guardian, "We
are in danger of sleepwalking into a future crisis. There is
going to have to be a severe awakening to the escalation
of risks, but we are in a leaderless world." Brown, who was
PM when Lehman collapsed, admitted that governments
had not been tough enough on the banks since the crash.
UK Shadow Chancellor John McDonnell gave a speech
on 15 September outside the Bank of England pointing
out that ordinary people are still paying for the response
to the GFC with austerity budgets and falling living standards.
McDonnell said: "One of the key lessons to be learnt
from the crash is that never again must we allow finance
to become the master of the economy, rather than its servant.
Labour in government will put finance to work for
the real economy."
So feared by the City of London's banks, this prospect,
inclusive of Glass-Steagall banking regulation, a national
investment bank and the renationalisation of vital infrastructure,
is becoming more likely with every new banking
tremor. The 16 September Telegraph reports that investment
bank Keefe, Bruyette & Woods puts the chance
of a Jeremy Corbyn Labour government sweeping to power
this year at 31 per cent! This could materialise with a
snap election brought on by a vote of no confidence in
PM Theresa May's Brexit strategy.
With the crash in motion and warnings of violent social
unrest not seen in 50 years ("JPMorgan is thinking pitchforks
and Fed stock buying in the next financial crash",
AAS 12 Sept.), elite interests are intent on staying in power
using the now familiar pretext of terrorism to justify a
police-state crackdown (p. 9).
Articles include the following:
- 10 years after the GFC, financial system again on the brink
- Learn from Australia—UK needs in-depth inquiry into banking crimes
- Did Downer lie to launch 'Russiagate'?
- Woodward's fear: Trump is President
- Vladivostok Forum: strategic talks and economic development hopes
- Discussion of Glass-Steagall on the rise
- Why is British intelligence letting loose convicted terrorists?
- How London's Euromarket killed Bretton Woods
- The real Goldfinger
- Corbyn will take on the City
- Help homeowners and farmers: break up the banks!
- Unsung hero: Engineer L.B.S. Reid
- ALMANAC - Lessons for a recovery: A qualitative economic transformation-Part V
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