Wish U Were Here, Janet Yellen

Janet Yellen, Federal Reserve Chair 2014-2018

I’m going to miss the first woman to ever head the Federal Reserve, Janet Yellen, appointed by President Obama. She has just served the shortest term of any recent Chair. No, she wasn’t ill, newly pregnant, or incompetent; she just wasn’t reappointed by President Trump. She was known for consensus building.

One of two mandates of the Federal Reserve is sustaining employment, helping to finance jobs. Under Yellen’s tenure, unemployment decreased from 6.7 percent in 2014 to 4.1 percent in 2018. Trump took credit, tweeting women’s job rates while pink-hatted women marched on his inaugural anniversary (while the government shut down.) But without explanation or complaint, he’d already replaced Yellen with yet another pale male, William Powell.

Her male predecessors served terms more than twice as long: Ben Bernanke (8 years), Alan Greenspan (19) years, and Paul Volcker (8) years. Longer tenures supposedly help ensure financial stability. In Screwnomics, I complain women like Yellen can and do learn to “mansplain” the economy. Her monetary addresses to Congress delivered like those before her:  a firehose of lukewarm, gushing water-words impossible to take in, and strangely mesmerizing. What’d she just say?? Still, the financial press widely appreciated moderate Yellen.

She exasperated Sen. Elizabeth Warren, who pressured her more than once. Most recently it was over the Wells Fargo frauds. That’s the other Federal Reserve mandate, to regulate the banking system. But then as Janet left, she gave two parting gifts to the country: one was a raise in the long-term Treasury bond rate to cool down an overheated market. The other was the first big-bank punishment of its kind for Wells Fargo, removing board members, along with some real structural changes to address its being overlarge. https://tinyurl.com/ycmlbvyl

Will Mr. Powell stay the course and enforce those penalties on WF? Those rising interest rates? The word is that Trump’s money-men want to further undo regulation, setting freer the already free market, making it a libertine. That hasn’t gone well in our near past. I’m nervous, seeing last week’s near 1600-point DOW drop last week, but generally agree with those like Yves Smith at Naked Capitalism,  who say it’s a needed correction for overvalued bubbles https://tinyurl.com/y8u7tud2.

But I also agree with those who warn this new volatility has less to do with interest rates, than with fears about US national stability. Wall Street on Parade writers, Pam Marten and Russ Marten, say that the stock market, which has shrugged off the President’s low approval rating at home, and a diminishing reputation for steady, credible world leadership, are fools to ignore Trump’s chaos. http://wallstreetonparade.com/2018/02/stock-market-panics-on-treasury-yields-fed-and-trumps-domestic-wars/

The whole world knows about the Republican tax gift to our richest, essentially gutting the government budget, weakening it further. We’re going to spend millions on a military parade, not on veterans health care, and money for ICE, not dreamers. About now, I am mentally writing steady Janet a note that says, Wish you were still here.

"Our first big review...wowza!!!"

Friends, we have such exciting news! We just received our first big review from, drum roll please...Kirkus! Here it is!

KIRKUS REVIEW

Diamond (Whole Worlds Could Pass Away, 2017, etc.) sets out to debunk the patriarchy of capitalism in this nonfiction work aimed at women.

Capitalism, throughout history, has kept women from pursuing an equal or gainful role in the creation and accumulation of wealth, according to the author. Even today, she says, societal norms discourage women from taking an interest in economic affairs. As she writes in her introduction, when it comes to the economic discussions, “letting yourself doze off is as dangerous as sleeping with a huge python in the house. Only when a greater number of women understand economic secrets, muffled by slithery language, will we find the political will to transform them.” To that end, she offers a crash course in basic economic theory along with investigative dives into how women and minorities have been shut out of economic growth, the cause and fallout of the 2008 global recession, and the ways in which the economy could be fixed to work better for everyone. Mixing personal narrative, history, definitions, and entertaining comic-strip asides, illustrated by Todd, Diamond encourages women to get informed, to get angry, and to talk about wresting control of society from the oppressive “EconoMan.” Diamond writes in a peppy, accessible prose that brings clarity to complex subjects: “Voilà! It’s free market magic. The bias of sexism and racism is easily eliminated,” she says while explaining economist Milton Friedman’s theory of the cost of prejudice. “You see how this works for us, girls?” But for all these flourishes, the author doesn’t shy away from tackling complex (and sometimes-dry) economic ideas. Diamond claims to be merely an amateur economist, but her experience as a novelist, journalist, and professor are all brought to bear to demystify difficult concepts, such as Pareto efficiency (“Pareto basically said that an allocation of resources is efficient if as a result, one individual is better off, and no individual is worse off”). Diamond’s wit and charm, combined with Todd’s quirky art, succeed in creating an economic primer that’s both informative and fun.

A smart, comprehensive economics guide with a feminist twist.

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Publish date: April 3rd, 2018

A Conscious CEO Among a Growing Group of Women Business Leaders

Vermont is dear to Screwnomics’ heart because of its “good neighbors with good fences” policies, and also because we call this beautiful Green Mountain State home. Women entrepreneurs, women legislators, and women “thought leaders” thrive here—and nowhere else do so many business people care about a larger picture than their dollar-profit “bottom line.” The biggest chapter of Businesses for Social Responsibility in the country, Vermont BSR, is here: https://vbsr.org/

This month, the CEO of Green Mountain Power, Mary Powell, a rare entity in herself in the energy industry, made #12 of a list of Thirty World Changing Women in Conscious Business, 2018. As background, a Catalyst study, in Nov. 2016, found that there are fewer women in the energy field than there are women in tech. http://www.catalyst.org/knowledge/women-energy

If you look at Mary Powell’s direction, predating the time of Trump, you may see why her touchy-feely management has brought her success. Says Rachel Zurer, the editor of Conscious Company Media:

““Is it just a coincidence that the first electric utility to become a B Corp is also one of the few led by a woman? We don’t know, but since she took the helm at Green Mountain Power (GMP) in 2008, Powell has continued to break barriers and shake up assumptions about what a utility can be — going as far as to call the business an “un-utility.

In one example of her obsessive focus on knowing customers, she moved the company HQ from a steel-and-glass fortress into a building shared with line-workers — in other words, the ones who meet customers every day. Under her leadership, GMP also became the first utility to partner with Tesla on Powerwall home energy solutions, and the first to offer a battery/solar off-grid package to its customers. Her focus on “leading with love” seems to be working: in a survey required by Vermont regulators in 2016, GMP received a 94 percent customer service satisfaction score and a 96 percent on providing reliable electric service.””

Powell advises other corporate leaders to “Be bold. Don’t think of yourself — think about the impact you can have. Make the mission larger than yourself.” How does she do that? What gives her hope? She said, “Love. I have long believed in the power of love: the power it holds to transform lives, the power it holds to transform companies, the power it holds to solve problems and to innovate a future that is better than our present or past.”

It’s EroNomics, the invisible passion, the renewable fuel for an economy we talk about in Screwnomics!

If you’re looking for more hope, you can access the whole list of 30 transformative business leaders, investors, and “conscious capitalists” here. This looks like a great media site. https://consciouscompanymedia.com/sustainable-business/30-world-changing-women-conscious-business-2018/

You’ll find among these another woman hero many Vermonters have shaken hands with:  the amazing Judy Wicks, who founded the White Dog Café with its local-sourced excellent food, who also founded a woman-friendly Business Alliance for Local Living Economies (BALLE). https://bealocalist.org/

Nevertheless, She Persisted—

The Sung family is at the center of this stirring film that reveals much about the American banking system, and way too much about American justice. The fiesty Sung sisters run the savings bank founded by their father, competently serving a neighborhood of immigrant Chinese. When they catch and report an employee’s fraudulent loans, they soon find themselves being investigated; it becomes apparent to many that their whole community is being scapegoated. Wait until you see their chain gang arrest!

In fact, their Abacus Federal Savings Bank was the only U.S. bank indicted for mortgage fraud related to the 2008 financial crisis. The film asks why this tiny bank—2,651st largest in the country when it was brought to trial—had to fight to save its reputation, while the biggest bankers on Wall Street that brought us the 2008 meltdown never were charged with any wrongdoing. 

The Sung family’s answering courage marks them as true American underdogs, our favorite kind of heroes. Directed by filmmaker icon Steve James (Hoop Dreams, Life Itself, The Interrupters), Abacus aired on Frontline in Sept. 2017, (where you can still stream it) and just was nominated for a “best documentary” Oscar for 2018.

James told a Frontline interviewer that the story has relevance today, “given that no justice was ever brought….Not only were the big banks not prosecuted coming out of that crisis, they were not regulated in a way to ensure that we’re not going to have more of these problems.” We agree with James and Oscar, and highly recommend it in the spirit of "Nevertheless, she persisted!"

Rotten is Grrrrreat!

I had a stomach flu yesterday and got through it by binging on the best series I've seen in a long while. Yes, it's a Netflix documentary series, and yes, it's about our global food supply—like spinach, one reviewer wrote. But oh my, I felt like Popeye afterward!  It is so very engaging, relevant, and beautifully told. 

I learned details about global trade, and the financial-ization of our food.  Each of the five episodes had gripping stories at their heart: an horrendous chicken serial killer, bee thievery, a convicted restaurant no-nut murderer, tales of New England's Codfather, and international intrigues of organic garlic farmers and raw milk producers. These were not just painless, but illuminating, enlivened by real people who cared about things real people care about. You see in this series,  close-to-home picture of dairy farmers, chick-growers, fishing folk, and hive-keepers, issues that you and your family and neighbors talk about: our bees disappearing, our new food allergies and fears, cheap chicken, expensive seafood, and garlic in everything gourmet.

China and trade policy figure largely in this, but all is enlivened by people on all sides you can care about. One of my mother's concerns, which I write about in Screwnomics is "the little guy," the real heroes and heroines in this film series. You see in this that regardless of national boundaries, we little guys have much more in common with each other, than with the looming and freakishly overlarge financial powers moving in on all of us, globalizing our food chains, cheapening our work and our health in ways we can collectively address—but only with knowledge. This series provides us with that.  I highly recommend it.  

Whose Asset? Whose Debt?

You and I think of our loans as debts or a minus. But banks consider them an asset, a plus—as in money in the bank. The bank or creditor has gotten you to sign on the dotted line. You have promised to repay the borrowed money, plus more, with extra charges called interest added in. Whether mortgages, car loans, or student loans, these interest charges are paid upfront, with the principal, or money owed, barely touched. In that way, loans are worth a lot to the loaner

So here is something to keep you up at night. Wall Street has begun securitizing student loans, a phenomenon they have newly named SLABS (Student Loan Asset-Backed Securities). Ellen Brown has been writing about this extensively, and if you want the wonky details, read her at Common Dreams. https://tinyurl.com/y877wemWhy should you care? Do you remember the 2008 mortgage crisis that led to a global financial meltdown? Back then, Wall Street had securitized the nation’s mortgages to re-sell to investors. To securitize means to take an asset, like a bank’s mortgage loans, and through “financial engineering,” as Investopedia puts it, https://tinyurl.com/y7yskx78, transform those into a more liquid and fast-traded “asset-backed security.” An even bigger global Wall Street bank then sells them to big-time investors.

This financial re-engineering first began in the 1990s, hailed by Washington.Wall Street made so much new money that everyone tried to cash in on the nations’ bank assets, namely US  citizens’ debts. Real estate prices soared! Loans were easy! You remember what happened then? Fraud, subprime liar loans, and a huge crash, which citizens then bailed out with their taxes, rescuing the biggest banks, instead of letting them fail from their fraud and bad judgement.

So now with student debt liabilities amounting to $1.7 trillion for 44 million borrowers (the 2016 student average was over $37,000 each), says Forbes, ( https://tinyurl.com/y73pr83u )—are we seeing another crash in the making?  College tuitions, so necessary for any kind of survivable future,  may create assets and soaring numbers for Wall Street. But thinking of this unprecedented burden on an entire generation as an “asset” accrues only to the wealthiest few. For the many who face an indebted future of laying golden eggs for the SLABS omelet, their goose is already feeling cooked.  

Look for #unscrewed student debt stories in future.