• by Hazel Henderson
• Wednesday, October 19, 2011
• Inter Press Service

'We recognize finance as part of the global commons,' affirms the Transforming Finance statement, signed by financial professionals worldwide critical of today's casino capital markets. Financialization has produced the global debt bubble. Needed now are write-offs and haircuts to bond-holders and bank shareholders, a curb on bettors buying credit default swaps, as well as below 1% financial transaction taxes to limit volatility and high-frequency trading by computers —now 60% of all transactions, writes Hazel Henderson, author of Ethical Markets:Growing the Green Economy and other books, and president of Ethical Markets Media (USA and Brazil)

We learn how bankers and financiers fought ferociously to weaken the reforms in the US 2010 Dodd-Frank law. They shaped the law to defer action to regulators who now are surrounded by financial lobbyists, bent on weakening the new rules. Similar power plays attacked the UK's Vickers Independent Commission on Banking which called on 'ring-fencing' retail banking and shielding depositors from the risks of trading and investing activities. The Bank for International Settlements' new Basel III rules to increase the capital reserves banks must hold against their losses has also been attacked, notably by Jamie Dimon, CEO of JPMorgan Chase, who called it 'anti-American.' A new report, Treasure Islands, documents how offshore banking avoids regulation in all countries by setting up phony regimes, not only those cited by the OECD'S Blacklist but also the City of London and the American states of Delaware, South Dakota, Oregon, where thousands of corporations are domiciled to avoid taxes, regulation and disclosure of their finances.

Cleaning up this global financial cesspool is a daunting task requiring courage and wider cooperation. Meanwhile, private investors have placed $2.4 trillion in green sectors worldwide since 2007. Phasing out tax loopholes and subsidies to fossil fuels, nuclear power, ethanol and those supporting 'too big to fail' banks and their backdoor bailouts by central banks' money-printing are now all on the global agenda (GSI). The G-20 and many countries support financial transaction taxes, not only to curb robotized high-frequency trading while protecting real investors, but also to help reduce government budget deficits.

(*) Hazel Henderson, author of Ethical Markets:Growing the Green Economy and other books, is president of Ethical Markets Media (USA and Brazil), www.ethicalmarkets.com.

© Inter Press Service (2011) — All Rights Reserved. Original source: Inter Press Service