Monthly Archives: October 2013

Kirby Cundiff: Why Do Banks Keep Going Bankrupt?

"During the recent crises in Cyprus, proposals were seriously considered to ignore the 100,000 EUR deposit insurance and seize a fraction of even small depositors’ money. Most depositors lost access to their accounts for over a week and large depositors are still likely to lose a large fraction of their assets. Most depositors still believe that deposit insurance will cover any possible losses. If banks are to become more stable, the amount of equity relative to debt in the banking system must be drastically increased to something resembling what it would be without government deposit insurance, central bank subsidies, and treasury bailouts." Continue reading →

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Bill Bonner: Alan Greenspan’s Shock Revelation

"We know from bitter experience that trying to force economies to do what you want is a thankless task. Markets are fundamentally based on free exchange, cooperation, trust and trade. Force them in one direction or another and you are just asking for trouble. As Alan Greenspan described this week, in an interview with John Stewart on 'The Daily Show,' people are a little 'screwy' from time to time. Which means they don’t necessarily go along with your central planning, no matter how good you think it is. But still economists insist that, if they are allowed to monkey around with it, they can make an economy better. This is occasionally true." Continue reading →

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FINTRAC collecting too much info on innocent Canadians: privacy watchdog

"By law, Canadian banks, casinos and thousands of other businesses are required to report all financial transactions over $10,000, and any movement of money they suspect may be linked to terrorism or laundering the proceeds of crime. But in a special report to Parliament today, Privacy Commissioner Jennifer Stoddart complains that an investigation of the Financial Transactions Reports Analysis Centre, known as FINTRAC, found found everyday financial transactions of ordinary Canadians — things such as down payments for homes and cars, and wire transfers from families overseas to their children studying here. FINTRAC has amassed over 165 million reports." Continue reading →

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European Parliament votes to suspend US SWIFT data exchange

"The European Parliament has voted to suspend its SWIFT data exchange agreement with the US. They’ve called for US access to the SWIFT database to be halted following concerns that the US is spying on the EU, and not simply trying to combat terrorism. EU lawmakers suspect that the US has abused an agreement giving it limited access to SWIFT. As such, they voted to freeze Washington’s capacity to track international payments through the site. The worry comes after leaked American documents indicating the US was covertly tapping into SWIFT were aired on Brazilian television. The US denies any wrongdoing." Continue reading →

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SEC Proposes Crowdfunding Rules, But…

"To produce an offering disclosure document, enlist a funding portal, run background checks and file an annual report with the SEC year after year might well cost upwards of $100,000. In order for equity crowdfunding to the public to serve as a useful tool, as intended, Congress needs to amend the JOBS Act to make it less onerous and costly. Unfortunately, the SEC’s hands are tied since the JOBS Act itself creates most of the restrictions in the proposed rule. The SEC, for its part, did not tighten restrictions from the JOBS Act. This might be signal that even the SEC thinks the JOBS Act is too restrictive. Time will tell." Continue reading →

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The Bitcoin revolution could change government

"All governments, including ours, and especially the US’s, use the 9/11 terrorist attacks in 2001 as an excuse for reversing gains in human liberty achieved over many decades of struggle. In the name of fighting terrorism and other 'organised crime', jurisdictions, banks and companies that used to respect privacy must now reveal all. Under what the Constitutional Court called 'draconian' powers, anyone’s assets can be seized by unbridled bureaucrats. Bitcoin enables ordinary people to fight back, to avoid and evade snooping governments, which enact, use and abuse laws that allow them, without due process, to investigate, tax, control and seize privately owned assets." Continue reading →

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Attempts To Eliminate Cash Are More Than A Privacy Disaster

"Politicians are suggesting that cash should be gradually replaced by credit card transactions and direct bank transactions, making every single movement of money trackable, seizable, and reversable. This is not just a privacy disaster, it’s also a resilience disaster. I had the privilege of having a long conversation with the Chief Security Officer of one of the larger European banks, and he told me the outcome was a given – there will always be some kind of cash. Whether it’s issued by a central bank is completely beside the point; if central-bank cash isn’t readily available, people will create a way to trade between them without involving a third party." Continue reading →

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Bank Calls Customer Over Detected Bitcoin Transactions

"Sean Percival today wrote about how he received a phone call from his bank, because 'they detected Bitcoin related transactions,' and they asked him if it was for personal use or business. And, no, it wasn't because of some concern about fraud. Percival clarified that it was just about Bitcoin, and said they wanted to know about 'a spike in activity' with merchants like Coinbase. He later confirmed that it was not even from the fraud department. Percival does not name the bank, other than to say that it's 'one of the biggies.' It will be interesting to see if this becomes a regular thing, and whether or not it'll become yet another path for government officials to try to track Bitcoin usage." Continue reading →

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Swedish bank freezes customer’s account after she sells 5 bitcoins

"Swedbank recently froze a customer’s account after it found out about her selling five bitcoins on a digital currency marketplace. Bröms Hopkins went on to say she was particularly frustrated that the bank didn’t try to contact her before freezing her account. 'Then a guy from the bank called me. He didn’t say it in so many words, but in between the lines he advised me against doing business in bitcoins because of its anonymity. After his call I felt a bit like a criminal,' she said. The bank reopened Bröms Hopkins’ account 15 days after they imposed the freeze." Continue reading →

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Mastercard Hates Bitcoins

"The new boss in charge of giving out a MasterCard licenses has no intention of allowing the brand or any bank that does private label cards to use Bitcoins. In fact, he nearly bragged to me about killing the BitInstant deal with a U.S. bank for the first planned $BTC card this year. Stephen Ruch, the heavyset MasterCard executive, is just a year into his job with the company, and while he monitors the Bitcoin space he told me he is still under the impression it’s one big Ponzi scheme. [..] His biggest fear was it would 'hurt the MasterCard' brand." Continue reading →

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