Tag Archives: deleveraging

Business/Economics

U.S. Job Losses & Store Closings 01 – 02 May 2014: “a kick in the gut!” No more soft cheese? Successful internet model railroad company deleveraged to death by Too Big to Jail banks! ObamaCare killing 2-thousand+ jobs!

Incomplete list of publicly announced layoffs & shutdowns:

Who said internet businesses are making money?  Internet game provider GameSpy no longer exists, it was killed off by its new owner Glu Mobile.

California: In South Lake Tahoe, Barton Hospital warned of massive layoffs due to Obama Care, is offering employees bribes to voluntarily quit.  Already 42 employees have volunteered to quit in May.  According to local news reports, and no thanks to Obama Care, California’s Medi-Cal system pays the lowest reimbursements of any state in the Union!  In Buena Park, Easy Life Furniture announced they will shutdown in June, 47 jobs lost.  In Fullerton, Metalclad announced they were shutting down in June, 100 jobs lost!  In San Diego, civil engineering company URS warned they will layoff 193 people in June!

Florida: In MacDill Air Force Base, taxsucker Leidos killing 93 jobs.  The company lost their USCENTCOM contract.

Georgia:  Atlanta based CNN (Cable News Network) eliminating or reassigning 50 jobs.  Some employees were told they could stay employed, if they took huge cuts in pay!  In Tybee Island, after six years Doc’s Bar shutdown due to rent issues.

Illinois:  In Rockford, Schnuck Markets killed 163 grocery store jobs!   Schnucks began “restructuring” operations at its two largest stores, and shutdown two smaller stores that were suffering from crashing sales.  In Freeport, health insurance provider MetLife shutdown their office.  An undisclosed number of employees got laid off, while others will be working from home.

Iowa: In Sioux City, after 29 years Hatch Furniture & Flooring shutdown for good.

Michigan:  In Detroit, India based generic legal drugs pusher Caraco Pharmaceutical Laboratories shutting down their factory, 178 jobs lost in June!  They had 450 employees in 2009.  The company is controlled by India’s Sun Pharma, and has been in trouble with the U.S. FDA for years now (for example: drugs for diabetics had been found contaminated with metal shavings!).

Missouri: As a result of Obama Care, the largest pharmacy benefit management company in the U.S., Saint Louis based Express Scripts, killing 1890 jobs across the country, and shutting down two operations in Texas!  ‘Front End’ pharmacy operations in Florida will also lose 400 jobs!

Nevada: The city of Reno approved the layoff of 35 firefighters.  It’s blamed on the loss of federal funding.  But don’t feel too bad about firefighters, it turns out the average firefighter makes bank off the taxpayers in Reno: “The average pay for the firefighters in this city is $129-thousand.”-Dwight Dortch, city councilman

New Jersey:  In Medford, 7 Deuce Sports fitness center shutting down.  The pro-football player-owner said his football career comes first.

New York: Who said the internet is making money?  E-commerce site Fab killing 60 jobs in June.  In Oneonta, the etc. etc. store shutdown.  In Watertown, Convergys kills more jobs, this time 200 call center employees to go hungry!  Convergys continues to loss contracts.  In NYC, Aéropostale announced it will shutdown 125 children’s P.S. clothing stores across the U.S., hundreds of jobs lost!  Company officials blame it on the changing spending habits of ‘mom shoppers’.  Media company Fuse shutdown, 102 jobs lost!   In Farmingdale, Model Power, a major internet model railroad retailer, is being killed off by Too Big to Jail banks: “After nearly 50 years serving the hobby industry, our 3rd generation family business will be closing effective immediately to the public. We will be reaching out to our clients over the next few weeks to settle any demand needs that they may have.

In 2007, our banks began an aggressive deleveraging process. They no longer approved of a profitable and paying client such as ours, which had been reliant on inventory. This is why one of the industry’s most extensive lines, had begun to see much of its products unavailable on the market. Now it will no longer be seen at all.

During these past 7 years, we had made changes to the business in order to accommodate and adjust to the changing nature of the business relationship with our lenders. We had offered multiple solutions to our lenders in order to ‘fix’ our situation, all were rejected, came with different restrictions, or offered too little too late. In all our efforts, no arrangements by our lenders would allow for Model Power to arrive at a position in which we could get back to fill our customer needs.

We would like to take the time to thank all of those whom we have worked with the past 50 years. To our customers and competitors within the industry, we thank you.

Sincerely,
The Model Power Family”

I’ve been reporting on the deleveraging conspiracy by the Too Big to Jail banks, read the articles and weep: De-leveraging will continue until the economy improves, and that means you!,  it’s called Deleveraging and it’s a sign we’re in a “Terminal Downturn”!, 4,000 people stranded when….airline is suddenly deleveraged, All part of the IMF’s orders to deleverage!, IMF pushes for U.S. consolidation, code for even more drastic deleveraging!

North Carolina: Obama Care more powerful than God, as Wake Forest Baptist Medical Center kills 350 jobs: “At the end of the day the Affordable Care Act is just reforming payments, it’s not really reforming health care!”-John McConnell, CEO

Ohio:  Ashland, maker of Valvoline petroleum products, to kill 800 jobs by the end of this year!  On top of that the company plans to offshore 1-thousand U.S. jobs!  Despite being an oil company, they claim to be losing tens of millions of dollars.   The Cincinnati Enquirer laid off 14 employees.   The newspaper laid off 300 people between 2012 and 2013!

Oklahoma: The city of Tulsa eliminating 216+ jobs!  Most of the jobs have been vacant for awhile.    City officials blame a $14-million USD shortfall on crashing tax revenues.  In Norman, OfficeMax shutting down their call center, 125 jobs lost in June!  Blame the merger with Office Depot.

Oregon: In Portland, after 17 years, Jackpot Records shutting down in June.  The owners claim they aren’t blaming the landlord and city officials, but they really did: “…the rents have gone up over the years and the city we all love and contribute to continues to change in ways that both help and hurt local businesses like Jackpot, these factors really don’t play into this decision as much as they could.”

Vermont: Keurig Green Mountain (aka Green Mountain Coffee) laid off 12 people: “Over the past several months, we have combined our Massachusetts and Vermont-based consumer-facing teams, allowing us to have a single approach to our consumer care. As a result, we expect a reduction in the number of incoming calls the team will handle directly…”

West Virginia: In Saint Albans, Active Sports Complex shutdown.  No official reason was given.   The fitness center had been for sale for the past six years, but nobody wanted to buy it.

Wisconsin: In Denmark, after more than 32 years butter/cheese maker Land-O-Lakes shutting down their soft cheese factory in July, at least 90 jobs lost.   Company officials say soft cheeses are no longer profitable.   An employee who worked there since 1982 called it “a kick in the gut”.

30 April 2014: “…we must act now!”

The U.S. Department of Labor (DoL) doesn’t count the hundreds of layoffs involving less than 50 people each, in its mass layoff reports. It also doesn’t count all the little ‘mom & pop’ businesses that shut down.

“Our ideals and principles, as well as our national security……..That’s what makes America different. That’s what makes us exceptional.”-Barack Obama, 10 September 2013

Business/Economics, International, U.S.

No True Economic Recovery: Renowned Economist says this is totally the Banks’ fault, nothing can be done by governments, working class been paying for it, it’s called Deleveraging and it’s a sign we’re in a “Terminal Downturn”!

Steve Keen is Professor of Economics & Finance at the University of Western Sydney, Australia.  He was named by Forbes as the most accurate economic forecaster in this economic disaster.  He received the Revere Award from the Real World Economics Review, also for his accurate predictions. He wrote the book Debunking Economics.

Now in a recent interview with former Wall Street broker, Timothy Maxwell “Max” Keiser, Keen says there is nothing governments can do to save the economy, because it is actually an inherent part of the banking system’s sinister operations!

No amount of tax increases, or government spending cuts (austerity), or government spending increases (Keynesian spending), or even corporate bailouts will help save the economy.  It’s called deleveraging: “The reason it hasn’t worked….this is massive deleveraging. The private sector has borrowed its way into enormous levels of debt over about 40, 50 year period….from owing about half a year’s GDP as the debt level in the 1950s to [owing] three years GDP now!”

I’ve already written about the IMF’s order to continue deleveraging of households (that’s you and me), Keen is saying this is part and parcel of the too big to fail banks policies.

Deleveraging (retracting credit) means the banks try to get rid of their debts.  Those debts include the mortgages and credit cards they’ve issued to the general public.

They deleverage households by calling in your chips, saying pay up now.  It doesn’t matter if you’re credit rating is good or not.  Many of the foreclosures involved people who had never missed payments, even people who had paid off their homes!  And deleveraging attacks corporations as well.

A recent case of deleveraging, involving a major corporation, was the shut down of Air Australia. The airline was shut down when it’s creditors (too big to fail banks) refused to leverage (issue credit) for Air Australia’s fuel purchases.

Steve Keen says the too big to fail banks are now deleveraging everyone because the too big to fail banks became addicted to debt themselves!  This goes back to the 1980s, and includes personalities like Alan Greenspan and Mitt Romney.

Keen says it’s the vulture capitalist mentality that is destroying the country: “…capitalists in euphoric states, and certainly finance capitalists…they borrow money, they gamble on asset prices, they’ll cause a bubble…of course the borrowing is badly thought out, projects don’t work, they’re ponzi schemes in many ways to begin with…you go through periods of ratcheting up levels of debt, until you get to the point that there’s so much debt the system simply can’t cope with it and you go into a terminal downturn, and that’s where we are right now.”

The 1980s saw the beginning of the trend of vulture capitalists, like Mitt Romney, using leverage (loans) to take over companies, carve them up and sell them off.  Not only did it make big money for people like Mitt Romney (while causing millions of U.S. workers to lose their jobs between the 1980s and now) it made big money for the too big to fail banks.

In steps Alan Greenspan.  The Federal Reserve is the central bank of the U.S.  It actually makes money off issuing loans to the too big to fail banks.  So, it is in the interest of the Federal Reserve to keep this game going.  It’s not about jobs at all, it’s about making money purely through loans.

Presidential candidate Ron Paul is correct about the Federal Reserve being part of the problem, because Keen says Greenspan is responsible for what is about to become the biggest depression ever: “…Alan Greenspan turned what would have been a garden variety small depression, back in 1987, into the biggest depression in human history by rescuing the financial industry from each of its mistakes.  Which simply meant that it [finance industry] would go looking for another social class to lend money to, expanding the level of debt…If the central banks hadn’t been trying to rescue us from each of the individual financial crisis we would’ve had a minor depression…we’re now in for the biggest of all time…now we’re dealing with the biggest financial crisis ever, and we can certainly blame the central banks for the scale of it.”

Keen also discovered, while working through his mathematical models, that when the shit hits the fan it’s not the banks and vulture capitalists who pay for the debt they themselves created, it’s the working class: “…So, as the level of debt rose, it wasn’t the capitalists who paid for it, even though they were the ones doing the borrowing, it was the workers in terms of their income share…the ones who are now paying for it through austerity actually are the ones who’ve been paying for it through a lower share of income, not the capitalists….” 

Here’s what Keen had to say about the too big to fail banks: “Having a large financial sector is a sign of a sick economy.”  Because banks represent finance capital and “…finance capital doesn’t make money!”  Keen explained that banks are there to help true industries operate, and make money the old fashioned way, by earning it through providing products or services.  In other words you should not have too big to fail banks making up the majority of your country’s GDP, which is in fact what’s happening in the U.S.

Towards the end of Keen’s interview with Max Keiser, he predicted that Australia’s economy will begin to crash within six to 12 months, and he thinks the Australian government will attempt the same pro-bank, anti-worker, rescue policies as that of the United States.  Keen calls the U.S. policy “…rescuing the parasite [banks, Romney style capitalists, etc] rather than rescuing the host [true industries, working class].”

In the early 1990s Keen came up with an economic model that takes into account vulture capitalist debt financing.  He used mathematical chaos theory to prove what film maker Oliver Stone tried to warn about in his movie Wall Street: Mitt Romney style capitalism doesn’t work, and doesn’t create more jobs in the long run.  Back in 1993 Keen warned that any apparent tranquility caused by the out of control crony capitalist debt financing was actually “…the lull before the storm.” 

Check out debtdeflation.com

 

 

 

 

Business/Economics, Idaho, U.S.

Occupy Idaho: Bank sues Mayor for business loan, Mayor says her business is not in trouble

Coeur d’Alene Mayor Sandi Bloem was shocked to learn that her jewelry store is being sued for more than $80,000.

Panhandle State Bank says the lawsuit is over a $75,000 loan made back in 2005.  Bloem says she was in the process of renegotiating the loan, and never had any indication the bank was going to sue.  She says her jewelry store is not in financial trouble, even though the bank says she failed to pay off the loan.