Wednesday, April 21, 2010

Major Plan for Global Tax of Banks, Just Ahead

Using the current crisis environment to expand global control of the banking sector, which will ultimatley lead to the directing of bank funds towards global government favored projects, the IMF plans to call for extensive new taxation of the banking sector.

The news of the IMF plan was strategically leaked last night ahead of the G-20 meetings in Washington D.C. to kep finance ministers and other delegates of smaller nations on topic at the meetings.

The UK's Guardian reported the news this way:

Tough proposals to cut the world's biggest banks down to size by taxing their profits and pay were outlined by the International Monetary Fund tonight in an attempt to spare taxpayers another massive public bailout of the financial sector.

In measures more stringent than Wall Street and the City had expected, the fund called for the introduction of a twin-track approach to the three-year banking crisis that would both force firms to pay for any future support packages and raise new taxes on their profits and remuneration.
The report, prepared by the Washington-based institution for the G20 group of developed and developing nations, was seized upon by Gordon Brown as evidence that his push for an international crackdown on the banking sector was gaining support.

Leaked in advance of the fund's meeting this weekend, the blueprint emerged as the investment bank Goldman Sachs released better than expected first quarter revenues and admitted its bonus and pay pool had reached $5.5bn (£3.3bn) in the first three months of 2010.

The anticipated study called for a financial stability contribution (FSC), which should be paid by all financial institutions, not just banks, and used to bail out weak and failing firms. It would initially be paid at a flat rate but eventually be tailored to suit institutions' size and riskiness.

While banks had been braced for the FSC plan, they were caught unawares by the proposal for a financial activities tax (FAT), which would be based on the profits and the pay structure of the firms.
One key point to note is that the tax will be based on "riskiness" where government paper will most assuredly be ranked as least risky, thus driving banks funds in the direction of propping up the government debt sector at the expense of the productive private sector.


  1. "government paper will ranked as least risky"

    Hahaha. Least Risky? Sure. Just ask Greece, Spain, Italy, Ireland, California, New York, Los Angeles, or the hundreds of idiotic governments that can't manage jack how "at risk" they are.

  2. Amazing. Politicians continue to lay the groundwork that will guaranty we will have another financial crisis. And yet I see no solution. No practical way out. No way to prevent this very greedy human reaction to continue looting as long as they can get away with it. And politics, with its confusing, us vs. them rhetoric has proven to be the best way to get away with it.

    Unless we de-legitimize politics as a decision-making process. STOP VOTING, IT ONLY ENCOURAGES THEM.

  3. These banks will not pay a dime they will find someway to put on our backs just as they did with everything else