Global Economic Intersection
Advertisement
  • Home
  • Economics
  • Finance
  • Politics
  • Investments
    • Invest in Amazon $250
  • Cryptocurrency
    • Best Bitcoin Accounts
    • Bitcoin Robot
      • Quantum AI
      • Bitcoin Era
      • Bitcoin Aussie System
      • Bitcoin Profit
      • Bitcoin Code
      • eKrona Cryptocurrency
      • Bitcoin Up
      • Bitcoin Prime
      • Yuan Pay Group
      • Immediate Profit
      • BitQH
      • Bitcoin Loophole
      • Crypto Boom
      • Bitcoin Treasure
      • Bitcoin Lucro
      • Bitcoin System
      • Oil Profit
      • The News Spy
      • Bitcoin Buyer
      • Bitcoin Inform
      • Immediate Edge
      • Bitcoin Evolution
      • Cryptohopper
      • Ethereum Trader
      • BitQL
      • Quantum Code
      • Bitcoin Revolution
      • British Trade Platform
      • British Bitcoin Profit
    • Bitcoin Reddit
    • Celebrities
      • Dr. Chris Brown Bitcoin
      • Teeka Tiwari Bitcoin
      • Russell Brand Bitcoin
      • Holly Willoughby Bitcoin
No Result
View All Result
  • Home
  • Economics
  • Finance
  • Politics
  • Investments
    • Invest in Amazon $250
  • Cryptocurrency
    • Best Bitcoin Accounts
    • Bitcoin Robot
      • Quantum AI
      • Bitcoin Era
      • Bitcoin Aussie System
      • Bitcoin Profit
      • Bitcoin Code
      • eKrona Cryptocurrency
      • Bitcoin Up
      • Bitcoin Prime
      • Yuan Pay Group
      • Immediate Profit
      • BitQH
      • Bitcoin Loophole
      • Crypto Boom
      • Bitcoin Treasure
      • Bitcoin Lucro
      • Bitcoin System
      • Oil Profit
      • The News Spy
      • Bitcoin Buyer
      • Bitcoin Inform
      • Immediate Edge
      • Bitcoin Evolution
      • Cryptohopper
      • Ethereum Trader
      • BitQL
      • Quantum Code
      • Bitcoin Revolution
      • British Trade Platform
      • British Bitcoin Profit
    • Bitcoin Reddit
    • Celebrities
      • Dr. Chris Brown Bitcoin
      • Teeka Tiwari Bitcoin
      • Russell Brand Bitcoin
      • Holly Willoughby Bitcoin
No Result
View All Result
Global Economic Intersection
No Result
View All Result

Non-Conservative Banking and U.S. National Security

admin by admin
August 27, 2011
in Uncategorized
0
0
SHARES
2
VIEWS
Share on FacebookShare on Twitter

bank by Guest Author Dan Flemming

Perhaps my career experience makes me more sensitive to national security issues than others may be.  Nonetheless, I am dismayed that the national security risks stemming from failures in the financial system are not more widely discussed.  U.S. National Security is tied to government financial behavior, U.S. banking behavior, U.S. financial industry practices in general and effective auditing across the board.Risky Business

There is much evidence today that the U.S. banking and financial systems are no longer conservative and appropriate risk management practices have not been used.  In addition, I conclude that the U.S. political system does not meet reasonable integrity goals and is experiencing a failure due to human factors.

There are only two choices in controlling U.S. banking risk and associated national security risk to liquidity problems and financial crises like the one in 2008:

  1. National banking regulations to establish and preserve conservative banking principals; and
  2. Industry self-regulation through industry associations and certifications.

An optimal system would utilize some features of both options.

A History of Degradation

We can trace a history of how the degradation has progressed.  The history is a specification of poor business practices, improper auditing processes and simply poor political and policy choices.  Here is a (partial) list:

  • “Guns and butter” policy by Lyndon Johnson for the Vietnam War led to increased government debt and, in effect, borrowing from Social Security to help pay war expenses.  The pillaging of Social Security, Medicare and Highway Trust funds continued from that time forward.
  • Liberalization of Savings & Loan regulations led to spectacular mismanagement and the S&L crisis of the late 1980s.
  • Failure to follow through from the lessons of the S&L crisis so that similar financial failures continued to occur.
  • Repeal of the Glass-Steagall Act (in 1999) that had kept commercial banking relatively stable since the 1930s.
  • Poor accounting practices, especially forward looking, for Social Security and Medicare.
  • A revolving door for personnel has been created between government policy makers, financial regulators and financial institutions.
  • Bosom buddy relationships have developed between rating agencies and the firms being rated.
  • Accounting scandals of the early 2000s (Enron, Worldcom, etc.) were systemic warning signals that were ignored.
  • The inability of political and financial leaders at the highest levels to see the financial crisis was imminent, even in the last few months before the final collapse in the fall of 2008.
  • The use of U.S. funds (via Federal Reserve) actions to provide trillions of dollars to non-U.S. entities in the months and years following the 2008 collapse has been done with little transparency and is only becoming evident long after the fact.

National Security is an Issue

The systemic risk associated with financial institutions is a national security risk because the position of the U.S. in the world is primarily the result of our financial strength.  We are weakened if the rest of the world loses confidence in us financially.

Our security is also supported by a strong military.  That cannot be maintained if our finances are corrupt.

Our security is supported by our citizenry, which support will be weakened if the citizens become impoverished by ill-advised bank actions.

We have gone through an episode (housing bubble) that saw banks making hundreds of billions (trillions?) dollars in loans that cannot be paid back because the equity backing has evaporated and the debtors’ incomes have been diminished.  We are now going through another episode where money has been lent (and appears will be further lent) to sovereigns that cannot repay.

It seems there is no global body that will ever be able to regulate or solve risk that manifests from the lower level of finance.  We must return to conservative ethics and practices in banking and finance.

What is Taken for Granted should Return

Banking today is taken for granted by most Americans even though we see banks as another big system we can’t control.  For banking, just like government systems, we simply want transactions to work in a straight forward way, through checking and savings in the case of banks.  Banks used to make an effort to appear conservative and show that they followed strict principals.  Today banks seem just to get bigger each year and there is not any obvious effort to become more stable and to have a primary business of handling deposits, checking and savings.

The commercial financial banking system is the foundation upon which business is built.  Business is the structure which provides employment for our citizens and forms the backbone of our national security.

About the Author

Dan Flemming is a Systems Analyst and Logistician. He has utilized dozens of defense systems to identify bottlenecks, problems, systemic issues, and solutions across agencies within the Department of Defense.

Previous Post

Interpreting the St. Louis Fed Stress Index

Next Post

East Coast Earthquakes and Tsunamis

Related Posts

Riot Blockchain’s BTC Mining Productivity Lost 28% YOY Amid Record Texas Heat
Business

Riot Blockchain’s BTC Mining Productivity Lost 28% YOY Amid Record Texas Heat

by John Wanguba
August 8, 2022
Musk Challenged Twitter CEO To Public Debate On Bots
Business

Musk Challenged Twitter CEO To Public Debate On Bots

by John Wanguba
August 8, 2022
BlackRock Partners With Coinbase
Business

BlackRock Partners With Coinbase

by John Wanguba
August 7, 2022
Bank Of Thailand To Unleash Retail CBDC Pilot
Economics

Bank Of Thailand To Unleash Retail CBDC Pilot

by John Wanguba
August 6, 2022
Obscure Fintech (AMTD Digital) Reaches $310B Valuation In GameStop-Style Explosive Surge
Business

Obscure Fintech (AMTD Digital) Reaches $310B Valuation In GameStop-Style Explosive Surge

by John Wanguba
August 5, 2022
Next Post

East Coast Earthquakes and Tsunamis

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Browse by Category

  • Business
  • Econ Intersect News
  • Economics
  • Finance
  • Politics
  • Uncategorized

Browse by Tags

adoption altcoins banking banks Binance Bitcoin Bitcoin adoption Bitcoin market Bitcoin mining blockchain BTC business China Coinbase crypto crypto adoption cryptocurrency crypto exchange crypto market crypto regulation decentralized finance DeFi Elon Musk ETH Ethereum finance funding inflation investment market analysis markets Metaverse mining NFT NFTs nonfungible tokens nonfungible tokens (NFTs) price analysis regulation Russia social media technology Tesla the US Twitter

Archives

  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • August 2010
  • August 2009

Categories

  • Business
  • Econ Intersect News
  • Economics
  • Finance
  • Politics
  • Uncategorized
Global Economic Intersection

After nearly 11 years of 24/7/365 operation, Global Economic Intersection co-founders Steven Hansen and John Lounsbury are retiring. The new owner, a global media company in London, is in the process of completing the set-up of Global Economic Intersection files in their system and publishing platform. The official website ownership transfer took place on 24 August.

Categories

  • Business
  • Econ Intersect News
  • Economics
  • Finance
  • Politics
  • Uncategorized

Recent Posts

  • Riot Blockchain’s BTC Mining Productivity Lost 28% YOY Amid Record Texas Heat
  • Musk Challenged Twitter CEO To Public Debate On Bots
  • BlackRock Partners With Coinbase

© Copyright 2021 EconIntersect - Economic news, analysis and opinion.

No Result
View All Result
  • Home
  • Contact Us
  • Bitcoin Robot
    • Bitcoin Profit
    • Bitcoin Code
    • Quantum AI
    • eKrona Cryptocurrency
    • Bitcoin Up
    • Bitcoin Prime
    • Yuan Pay Group
    • Immediate Profit
    • BitIQ
    • Bitcoin Loophole
    • Crypto Boom
    • Bitcoin Era
    • Bitcoin Treasure
    • Bitcoin Lucro
    • Bitcoin System
    • Oil Profit
    • The News Spy
    • British Bitcoin Profit
    • Bitcoin Trader
  • Bitcoin Reddit

© Copyright 2021 EconIntersect - Economic news, analysis and opinion.

en English
ar Arabicbg Bulgarianda Danishnl Dutchen Englishfi Finnishfr Frenchde Germanel Greekit Italianja Japaneselv Latvianno Norwegianpl Polishpt Portuguesero Romanianes Spanishsv Swedish