I came across this term while catching up on my 3QD posts. Klepto capitalism makes a lot of sense and it describes corporate America very well. How can a company pay its workers $50,000 per annum and give its top execs millions, if not billions, of dollars each year? I think that the worst culprits are in the financial sector, especially in merchant banks and investment banks, with their bloated end-of-year bonuses often going into millions. Even with the economic downturn, these ultra-rich are getting richer.
Klepto Capitalism (n.) — an economic system where publicly traded corporations are run not to produce value for shareholders but to provide obscene amounts of wealth for CEOs and top executives.
What we have in the United States is no longer capitalism but klepto-capitalism: a system where publicly traded corporations are run not to produce value for shareholders but to provide loot for a new class of corporate mega-thieves.
Consumers are already feeling the next crisis, the credit card crunch. It’s normal. In North America, people live beyond their means thanks to credit cards. That’s how people accumulate thousands of dollars of bad debt.
The money is disappearing out of AIG. Analysts wonder where the $123 billion went.
The biggest portion of the Fed loan is apparently being used as collateral for A.I.G.’s derivatives contracts, including credit-default swaps.
Doesn’t sound good. That and exec pay. However, they were asked by Cuomo to halt any bonuses or exec compensation
The economy is showing signs of a slowdown. No shit. It’s at the lowest it has been 17 years. The Dow was up thanks to a report on the economy. It finished at 9,180.69, a gain of 189.73 or 2.11%. This morning, stocks are up as well. The Fed lowered its key interest rate by half a percentage point. Taiwan and a few other Asian countries followed suit.
Japan plans to invest $51 billion into their economy.
Stocks soared while expecting a Fed rate cut. The Dow closed at 9,065.12, a gain of 889.35 or 10.88%. Crude oil is still falling. It closed at $62.73. Consumer confidence is at a low point. Some analysts believe it’s the start of a consumer-led recession, but ultimately the problem rests with the banks and their derivatives schemes for making a quick buck.
Iceland raises its key interest rate to 18%, a gain of 6%. The hike is part of a deal Iceland struck with the IMF. It’s also a tactic to prop up frozen credit and currency markets. Two weeks ago, it cut the rate by 3.5% to 12%. British PM calls for more contributions by China and the Gulf States to the IMF to help out.
Huntsman/Hexion merger not going ahead as planned because banks won’t finance it. Washington considering helping GM and Chrysler merge.
Denmark is rethinking its spurn of the euro. Hedge fund traders take VW stock up to $1,256 a share, after Porsche announced that it had taken control of VW with 75% of the voting shares. This partly happened because short-sellers were betting that VW shares would fall. The shares closed at $1,215.38. On Friday, the shares were at $261.76 on the Frankfurt exchange.
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