Wealth is a nations most strategic asset
The focus of 911 was not blowing up a building or killing people, it was targeting our economic center
To some the vivid video images of the planes crashing into the world trade center is something we will never forget. The sheer magnitude of this devastating attack can how ever create a false illusion. Without question, the focus of the attack was not to destroy property but to inflict economic chaos within our economic system. Human casualties was the collateral damage in inflicting financial loss. The World Trade center was targeted for its economic strategic value. At the time they could have hit just about any target on the eastern seaboard had they chosen to do so.
The cost of economic terrorism
The Internal threat
We have been obsessed as a nation seeking justice over the 911 attack, while something far worst is unfolding in our midst. These acts of economic terrorism are costing well in excess of 200,000 lives annually. Where are the cruise misells and smart bombs? Where are our troops? Where is the national outcry? Where are those who are marching for change?
Before you dismiss this article as an exaggeration, keep in mind that this over and covert act of terrorism is playing out at the hands of the industrial complex that controls everything from the prescriptions in your medicine cabinet to the fast food you consume at the drive thru. 100,00 people die each year as the result of the prescribed use of pharmaceuticals in the US. Another 100,000 die from the effects of obesity. The Surgeon General of the United States during Bush's administration said without question that Obesity in the US poses much more of a security risk than terrorism ever did. According to some sources as much as 40% of health care provided in the US has no effect on improving the life of those who receive it.
I could go on about this for days but lets narrow our focus a bit to what the real root of this is all about. It's money and the monetary policies that are in place in the United States. Let's start to unravel this mystery by looking at its various key components.
The Federal Reserve- What is it, who governs it
It is however true that Congress should not have a hand in allowing partisan politics sway the actions of the Federal Reserve and its many programs. I would agree with this assessment in that Congress can't pass a balanced budget as we slide further in debt thru their reckless spending habits. We certainly do not need the predation and miss management of this group in responsible charge of our central bank. Congress can't manage is own house, how can they manage anyone else's.
Fractional-reserve banking is the practice whereby a bank retains reserves in an amount equal to only a portion of the amount of its customers' deposits to satisfy potential demands for withdrawals. Reserves are held at the bank as currency, or as deposits reflected in the bank's accounts at the central bank (Federal Reserve in our case). The remainder of customer-deposited funds is used to fund investments or loans that the bank makes to other customers. Most of these loaned funds are later redeposited into other banks, allowing further lending. Because bank deposits are usually considered money in their own right, fractional-reserve banking permits the money supply to grow to a multiple (called the money multiplier) of the underlying reserves of base money originally created by the central bank.[1][2]
Central bank money: money created or adopted by the central bank regardless of its form – precious metals, commodity certificates, banknotes, coins, electronic money loaned to commercial banks, or anything else the central bank chooses as its form of money
Commercial bank money: demand deposits in the commercial banking system; sometimes referred to as "chequebook money"
When a deposit of central bank money is made at a commercial bank, the central bank money is removed from circulation and added to the commercial banks' reserves (it is no longer counted as part of M1 money supply). Simultaneously, an equal amount of new commercial bank money is created in the form of bank deposits. When a loan is made by the commercial bank (which keeps only a fraction of the central bank money as reserves), using the central bank money from the commercial bank's reserves, the m1 money supply expands by the size of the loan.[2] This process is called "deposit multiplication".
state-issued money which is neither convertible by law to any other thing, nor fixed in value in terms of any objective standard.[2] money without intrinsic value that is used as money because of government decree.[3][4]
The term derives from the Latin fiat ("let it be done", "it shall be").[5]
While gold- or silver-backed representative money entails the legal requirement that the bank of issue redeem it in fixed weights of gold or silver, fiat money's value is unrelated to the value of any physical quantity. Even a coin containing valuable metal may be considered fiat currency if its face value is defined by law as different from its market value as metal.
The Nixon Shock of 1971 ended the direct convertibility of the United States dollar to gold. Since then, all reserve currencies have been fiat currencies, including the U.S. dollar and the Euro.[6]
From 1944 to 1971, the Bretton Woods agreement fixed the value of 35 United States dollars to one troy ounce of gold.[16] Other currencies were pegged to the U.S. dollar at fixed rates. The U.S. promised to redeem dollars in gold to other central banks. Trade imbalances were corrected by gold reserve exchanges or by loans from the International Monetary Fund. This system collapsed when the United States government ended the convertibility of the US dollar for gold in 1971, in what became known as the Nixon Shock[citation needed].
The Nixon Shock was a series of economic measures taken by United States President Richard Nixon in 1971 including unilaterally canceling the direct convertibility of the United States dollar to gold. It helped end the existing Bretton Woods system of international financial exchange, ushering in the era of freely floating currencies that remains to the present day.
Our FIAT currency is not redeemable into any asset of any kind. It's value is established only by the good faith of our government. Many international sources now question this good faith. What is the true value of the paper in our wallets? Nothing other than what those in Washington can sell to those who buy our bonds.
Basel III (or the Third Basel Accord) is a global, voluntary regulatory standard on bank capital adequacy, stress testing and market liquidity risk. It was agreed upon by the members of the Basel Committee on Banking Supervision in 2010–11, and was scheduled to be introduced from 2013 until 2015; however, changes from April 1, 2013 extended implementation until March 31, 2018.[1][2] The third installment of the Basel Accords (see Basel I, Basel II) was developed in response to the deficiencies in financial regulation revealed by the late-2000s financial crisis. Basel III was supposed to strengthen bank capital requirements by increasing bank liquidity and decreasing bank leverage.
The original Basel III rule from 2010 was supposed to require banks to hold 4.5% of common equity (up from 2% in Basel II) and 6% of Tier I capital (up from 4% in Basel II) of "risk-weighted assets" (RWA).[3] Basel III introduced "additional capital buffers", (i) a "mandatory capital conservation buffer" of 2.5% and (ii) a "discretionary counter-cyclical buffer", which would allow national regulators to require up to another 2.5% of capital during periods of high credit growth.
Leverage ratio
Basel III introduced a minimum "leverage ratio". The leverage ratio was calculated by dividing Tier 1 capital by the bank's average total consolidated assets;[4] The banks were expected to maintain a leverage ratio in excess of 3% under Basel III. In July 2013, the US Federal Reserve Bank announced that the minimum Basel III leverage ratio would be 6% for 8 Systemically important financial institution (SIFI) banks and 5% for their insured bank holding companies.[5]
Liquidity requirements
Basel III introduced two required liquidity ratios.[6] The "Liquidity Coverage Ratio" was supposed to require a bank to hold sufficient high-quality liquid assets to cover its total net cash outflows over 30 days; the Net Stable Funding Ratio was to require the available amount of stable funding to exceed the required amount of stable funding over a one-year period of extended stress.[7]
US Version of the Basel Liquidity Coverage Ratio Requirements
On October 24, 2013, the Federal Reserve Board of Governors approved an interagency proposal for the U.S. version of the Basel Committee on Banking Supervision’s (BCBS) Liquidity Coverage Ratio (LCR). The ratio would apply to certain U.S. banking organizations and other systematically important financial institutions.[8] The comment period for the proposal is scheduled to close by January 31, 2014.
The U.S. LCR proposal came out significantly tougher than BCBS’s version, especially for larger bank holding companies.[9] The proposal requires financial institutions and FSOC designated nonbank financial companies[10] to have an adequate stock of High Quality Liquid Assets (HQLA) that can be quickly liquidated to meet liquidity needs over a short period of time.
The LCR consists of two parts: the numerator is the value of HQLA, and the denominator consists of the total net cash outflows over a specified stress period (total expected cash outflows minus total expected cash inflows).[11]
The Liquidity Coverage Ratio applies to US banking operations with assets of more than 10 billion. The proposal would require: Large Bank Holding Companies (BHC) - those with over $250 billion in consolidated assets, or more in on-balance sheet foreign exposure, and to systemically important, non-bank financial institutions;[12] to hold enough HQLA to cover 30 days of net cash outflow. That amount would be determined based on the peak cumulative amount within the 30 day period.[13]
Regional firms (those with between $50 and $250 billion in assets) would be subject to a “modified” LCR at the (BHC) level only. The modified LCR requires the regional firms to hold enough HQLA to cover 21 days of net cash outflow. The net cash outflow parameters are 70% of those applicable to the larger institutions and do not include the requirement to calculate the peak cumulative outflows.[14]
Smaller BHCs, those under $50 billion, would remain subject to the prevailing qualitative supervisory framework.[15]
The US proposal divides qualifying High Quality Liquid Assets into three specific categories (Level 1, Level 2A, and Level 2B). Across the categories the combination of Level 2A and 2B assets cannot exceed 40% HQLA with 2B assets limited to a maximum of 15% of HQLA.[16]
Level 1 represents assets that are highly liquid (generally those risk-weighted at 0% under the Basel III standardized approach for capital) and receive no haircut. Notably, the Fed chose not to include GSE-issued securities in Level 1, despite industry lobbying, on the basis that they are not guaranteed by the full faith and credit of the US government.
Level 2A assets generally include assets that would be subject to a 20% risk-weighting under Basel III and includes assets such as GSE-issued and -guaranteed securities. These assets would be subject to a 15% haircut which is similar to the treatment of such securities under the BCBS version.
Level 2B assets include corporate debt and equity securities and are subject to a 50% haircut. The BCBS and US version treats equities in a similar manner, but corporate debt under the BCBS version is split between 2A and 2B based on public credit ratings, unlike the US proposal. This treatment of corporate debt securities is the direct impact of DFA’s Section 939 (i.e., the removal of references to credit ratings) and further evidences the conservative bias of US regulators’ approach to the LCR.
The proposal requires that the LCR be at least equal to or greater than 1.0 and includes a multiyear transition period that would require: 80% compliance starting January 1, 2015, 90% compliance starting January 1, 2016, and 100% compliance starting January 1, 2017.[17]
Lastly, the proposal requires both sets of firms (large bank holding companies and regional firms) subject to the LCR requirements to submit remediation plans to U.S. regulators to address what actions would be taken if the LCR falls below 100% for three consecutive days or longer.
Contrary to many myth's Basel III does not require the reintroduction of the Gold standard in the United States.
A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from existing capital or new capital paid by new investors, rather than from profit earned by the individual or organization running the operation. Operators of Ponzi schemes usually entice new investors by offering higher returns than other investments, in the form of short-term returns that are either abnormally high or unusually consistent. The perpetuation of the high returns requires an ever-increasing flow of money from new investors to sustain the scheme.[1]
The scheme is named after Charles Ponzi,[2] who became notorious for using the technique in 1920.[3] Ponzi did not invent the scheme (for example, Charles Dickens' 1844 novel Martin Chuzzlewit and 1857 novel Little Dorrit each described such a scheme),[4] but his operation took in so much money that it was the first to become known throughout the United States. Ponzi's original scheme was based on thearbitrage of international reply coupons for postage stamps; however, he soon diverted investors' money to make payments to earlier investors and himself.
Many large U.S.-based multinational corporations avoid paying U.S. taxes by using accounting tricks to make profits made in America appear to be generated in offshore tax havens – countries with minimal or no taxes. By booking profits to subsidiaries registered in tax havens, multinational corporations are able to avoid an estimated $90 billion in federal income taxes each year. These subsidiaries are often shell companies with few, if any employees, and which engage in little to no real business activity.
Loopholes in the tax code make it legal to book profits offshore, but tax haven abusers force other Americans to shoulder their tax burden. Every dollar in taxes that corporations avoid by using tax havens must be balanced by other Americans paying higher taxes, coping with cuts to government programs, or increasing the federal debt.
This study reveals that tax haven use is ubiquitous among the largest 100 publicly traded companies as measured by revenue.
82 of the top 100 publicly traded U.S. companies operate subsidiaries in tax haven jurisdictions, as of 2012.
All told, these 82 companies maintain 2,686 tax haven subsidiaries.
The 15 companies with the most money held offshore collectively operate 1,897 tax haven subsidiaries.
The 15 companies with the most money offshore hold a combined $776 billion overseas. That is 66 percent of the approximately $1.17 trillion that the top 100 companies keep offshore. This list includes:
Apple: A recent Senate investigation found that Apple pays next to nothing in taxes on the $102 billion it books offshore, which is the second highest amount of any company. Manipulating tax loopholes in the U.S. and other countries, Apple has structured three Irish subsidiaries to be tax residents of neither the U.S. –where they are managed and controlled – nor Ireland – where they are incorporated. This arrangement ensures that they pay no taxes to any government on the lion’s share of their offshore profits. Two of the subsidiaries have no employees.
Fractional Reserve Banking- how it works
Money Creation Process
There are two types of money in a fractional-reserve banking system operating with a central bank:[13][14][15]Central bank money: money created or adopted by the central bank regardless of its form – precious metals, commodity certificates, banknotes, coins, electronic money loaned to commercial banks, or anything else the central bank chooses as its form of money
Commercial bank money: demand deposits in the commercial banking system; sometimes referred to as "chequebook money"
When a deposit of central bank money is made at a commercial bank, the central bank money is removed from circulation and added to the commercial banks' reserves (it is no longer counted as part of M1 money supply). Simultaneously, an equal amount of new commercial bank money is created in the form of bank deposits. When a loan is made by the commercial bank (which keeps only a fraction of the central bank money as reserves), using the central bank money from the commercial bank's reserves, the m1 money supply expands by the size of the loan.[2] This process is called "deposit multiplication".
FIAT currency- what is it worth
Fiat money has been defined as: any money declared by a government to be legal tender.[1]
state-issued money which is neither convertible by law to any other thing, nor fixed in value in terms of any objective standard.[2] money without intrinsic value that is used as money because of government decree.[3][4]
The term derives from the Latin fiat ("let it be done", "it shall be").[5]
While gold- or silver-backed representative money entails the legal requirement that the bank of issue redeem it in fixed weights of gold or silver, fiat money's value is unrelated to the value of any physical quantity. Even a coin containing valuable metal may be considered fiat currency if its face value is defined by law as different from its market value as metal.
The Nixon Shock of 1971 ended the direct convertibility of the United States dollar to gold. Since then, all reserve currencies have been fiat currencies, including the U.S. dollar and the Euro.[6]
From 1944 to 1971, the Bretton Woods agreement fixed the value of 35 United States dollars to one troy ounce of gold.[16] Other currencies were pegged to the U.S. dollar at fixed rates. The U.S. promised to redeem dollars in gold to other central banks. Trade imbalances were corrected by gold reserve exchanges or by loans from the International Monetary Fund. This system collapsed when the United States government ended the convertibility of the US dollar for gold in 1971, in what became known as the Nixon Shock[citation needed].
The Nixon Shock was a series of economic measures taken by United States President Richard Nixon in 1971 including unilaterally canceling the direct convertibility of the United States dollar to gold. It helped end the existing Bretton Woods system of international financial exchange, ushering in the era of freely floating currencies that remains to the present day.
Our FIAT currency is not redeemable into any asset of any kind. It's value is established only by the good faith of our government. Many international sources now question this good faith. What is the true value of the paper in our wallets? Nothing other than what those in Washington can sell to those who buy our bonds.
Basel III accords
Capital requirements
Leverage ratio
Basel III introduced a minimum "leverage ratio". The leverage ratio was calculated by dividing Tier 1 capital by the bank's average total consolidated assets;[4] The banks were expected to maintain a leverage ratio in excess of 3% under Basel III. In July 2013, the US Federal Reserve Bank announced that the minimum Basel III leverage ratio would be 6% for 8 Systemically important financial institution (SIFI) banks and 5% for their insured bank holding companies.[5]
Liquidity requirements
Basel III introduced two required liquidity ratios.[6] The "Liquidity Coverage Ratio" was supposed to require a bank to hold sufficient high-quality liquid assets to cover its total net cash outflows over 30 days; the Net Stable Funding Ratio was to require the available amount of stable funding to exceed the required amount of stable funding over a one-year period of extended stress.[7]
US Version of the Basel Liquidity Coverage Ratio Requirements
On October 24, 2013, the Federal Reserve Board of Governors approved an interagency proposal for the U.S. version of the Basel Committee on Banking Supervision’s (BCBS) Liquidity Coverage Ratio (LCR). The ratio would apply to certain U.S. banking organizations and other systematically important financial institutions.[8] The comment period for the proposal is scheduled to close by January 31, 2014.
The U.S. LCR proposal came out significantly tougher than BCBS’s version, especially for larger bank holding companies.[9] The proposal requires financial institutions and FSOC designated nonbank financial companies[10] to have an adequate stock of High Quality Liquid Assets (HQLA) that can be quickly liquidated to meet liquidity needs over a short period of time.
The LCR consists of two parts: the numerator is the value of HQLA, and the denominator consists of the total net cash outflows over a specified stress period (total expected cash outflows minus total expected cash inflows).[11]
The Liquidity Coverage Ratio applies to US banking operations with assets of more than 10 billion. The proposal would require: Large Bank Holding Companies (BHC) - those with over $250 billion in consolidated assets, or more in on-balance sheet foreign exposure, and to systemically important, non-bank financial institutions;[12] to hold enough HQLA to cover 30 days of net cash outflow. That amount would be determined based on the peak cumulative amount within the 30 day period.[13]
Regional firms (those with between $50 and $250 billion in assets) would be subject to a “modified” LCR at the (BHC) level only. The modified LCR requires the regional firms to hold enough HQLA to cover 21 days of net cash outflow. The net cash outflow parameters are 70% of those applicable to the larger institutions and do not include the requirement to calculate the peak cumulative outflows.[14]
Smaller BHCs, those under $50 billion, would remain subject to the prevailing qualitative supervisory framework.[15]
The US proposal divides qualifying High Quality Liquid Assets into three specific categories (Level 1, Level 2A, and Level 2B). Across the categories the combination of Level 2A and 2B assets cannot exceed 40% HQLA with 2B assets limited to a maximum of 15% of HQLA.[16]
Level 1 represents assets that are highly liquid (generally those risk-weighted at 0% under the Basel III standardized approach for capital) and receive no haircut. Notably, the Fed chose not to include GSE-issued securities in Level 1, despite industry lobbying, on the basis that they are not guaranteed by the full faith and credit of the US government.
Level 2A assets generally include assets that would be subject to a 20% risk-weighting under Basel III and includes assets such as GSE-issued and -guaranteed securities. These assets would be subject to a 15% haircut which is similar to the treatment of such securities under the BCBS version.
Level 2B assets include corporate debt and equity securities and are subject to a 50% haircut. The BCBS and US version treats equities in a similar manner, but corporate debt under the BCBS version is split between 2A and 2B based on public credit ratings, unlike the US proposal. This treatment of corporate debt securities is the direct impact of DFA’s Section 939 (i.e., the removal of references to credit ratings) and further evidences the conservative bias of US regulators’ approach to the LCR.
The proposal requires that the LCR be at least equal to or greater than 1.0 and includes a multiyear transition period that would require: 80% compliance starting January 1, 2015, 90% compliance starting January 1, 2016, and 100% compliance starting January 1, 2017.[17]
Lastly, the proposal requires both sets of firms (large bank holding companies and regional firms) subject to the LCR requirements to submit remediation plans to U.S. regulators to address what actions would be taken if the LCR falls below 100% for three consecutive days or longer.
Contrary to many myth's Basel III does not require the reintroduction of the Gold standard in the United States.
Ponzi Scheme - what does this term mean
The scheme is named after Charles Ponzi,[2] who became notorious for using the technique in 1920.[3] Ponzi did not invent the scheme (for example, Charles Dickens' 1844 novel Martin Chuzzlewit and 1857 novel Little Dorrit each described such a scheme),[4] but his operation took in so much money that it was the first to become known throughout the United States. Ponzi's original scheme was based on thearbitrage of international reply coupons for postage stamps; however, he soon diverted investors' money to make payments to earlier investors and himself.
What defines a multi-national corporation
A multinational corporation (MNC) or multinational enterprise (MNE)[1] is hard to define precisely to obtain consensus from different professions.[2] For example, when acorporation that is registered in more than one country or that has operations in more than one country may be attributed as MNC. Usually, it is a large corporation which both produces and sells goods or services in various countries.[3] It can also be referred to as an international corporation.
They play an important role in globalization. Arguably, the first multinational business organization was the Knights Templar, founded in 1120.[4][5][6] After that came the BritishEast India Company in 1600[7] and then the Dutch East India Company, founded March 20, 1602, which would become the largest company in the world for nearly 200 years.[8]
They play an important role in globalization. Arguably, the first multinational business organization was the Knights Templar, founded in 1120.[4][5][6] After that came the BritishEast India Company in 1600[7] and then the Dutch East India Company, founded March 20, 1602, which would become the largest company in the world for nearly 200 years.[8]
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| Cayman Island home to 9000 multi national corporation addresses |
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| All you need is an off shore Post Office address to qualify |
Who is paying taxes and who isn't
Many large U.S.-based multinational corporations avoid paying U.S. taxes by using accounting tricks to make profits made in America appear to be generated in offshore tax havens – countries with minimal or no taxes. By booking profits to subsidiaries registered in tax havens, multinational corporations are able to avoid an estimated $90 billion in federal income taxes each year. These subsidiaries are often shell companies with few, if any employees, and which engage in little to no real business activity.
Loopholes in the tax code make it legal to book profits offshore, but tax haven abusers force other Americans to shoulder their tax burden. Every dollar in taxes that corporations avoid by using tax havens must be balanced by other Americans paying higher taxes, coping with cuts to government programs, or increasing the federal debt.
This study reveals that tax haven use is ubiquitous among the largest 100 publicly traded companies as measured by revenue.
82 of the top 100 publicly traded U.S. companies operate subsidiaries in tax haven jurisdictions, as of 2012.
All told, these 82 companies maintain 2,686 tax haven subsidiaries.
The 15 companies with the most money held offshore collectively operate 1,897 tax haven subsidiaries.
The 15 companies with the most money offshore hold a combined $776 billion overseas. That is 66 percent of the approximately $1.17 trillion that the top 100 companies keep offshore. This list includes:
Apple: A recent Senate investigation found that Apple pays next to nothing in taxes on the $102 billion it books offshore, which is the second highest amount of any company. Manipulating tax loopholes in the U.S. and other countries, Apple has structured three Irish subsidiaries to be tax residents of neither the U.S. –where they are managed and controlled – nor Ireland – where they are incorporated. This arrangement ensures that they pay no taxes to any government on the lion’s share of their offshore profits. Two of the subsidiaries have no employees.
American Express: The company reports having $8.5 billion sitting offshore, on which it would owe $2.6 billion in U.S. taxes if those funds were repatriated. That means that they currently pay only a 4.4 percent tax rate on their offshore profits to foreign governments, suggesting that most of the money is parked in tax havens levying little to no tax. American express maintains 22 subsidiaries in offshore tax havens.
Oracle: The tech giant reports having $20.9 billion booked offshore. The company discloses that it would owe $7.3 billion in U.S. taxes on those profits if they were not offshore. That means they pay a tax rate of less than one percent to foreign governments, suggesting that most of the money is booked to tax havens. Oracle maintains 5 subsidiaries in offshore tax havens.
Only 21 of the top 100 publicly traded companies disclose what they would expect to pay in taxes if they didn’t keep profits offshore. All told, these companies would collectively owe over $93 billion in additional federal taxes. To put this enormous sum in context, it represents close to the entire state budget of California and more than the federal government spends on education.
The average tax rate these companies currently pay to other countries on this income is just 6.9 percent - far lower than the 35 percent statutory U.S. corporate tax rate – suggesting that a large portion of this offshore money is booked to tax havens.
Some companies that report a significant amount of money offshore maintain hundreds of subsidiaries in tax havens. The top three companies with the greatest number of tax haven subsidiaries:
Bank of America reports having 316 subsidiaries in offshore tax havens. Kept afloat by taxpayers during the 2008 financial meltdown, the bank keeps $17.2 billion offshore, on which it would otherwise owe $4.5 billion in U.S. taxes.
Morgan Stanley maintains 299 subsidiaries in offshore tax havens. The bank, which also received a taxpayer bailout in 2008, reports holding more than $7 billion offshore, on which it would otherwise owe $1.7 billion in taxes.
Pfizer, the world’s largest drug maker, operates 174 subsidiaries in tax havens and currently books $73 billion in profits offshore. The company made more than 40 percent of its sales in the U.S. between 2010 and 2012, but managed to report no federal taxable income in the U.S. for the past five years. This is because Pfizer uses accounting gimmicks to shift the location of its taxable profits offshore.
Corporations that disclose fewer tax haven subsidiaries do not necessarily dodge fewer taxes. Since 2008 – the last time a study of this scope was done – many companies have disclosed fewer tax haven subsidiaries, all the while increasing the amount of cash they keep offshore. For some companies, their actual number of tax haven subsidiaries may be substantially greater than what they disclose in the official documents used for this study. For others, it suggests that they are booking larger amounts of income to fewer tax haven subsidiaries.
Consider: Citigroup reported operating 427 tax haven subsidiaries in 2008 but disclosed only 20 in 2012. Over that time period, Citigroup increased the amount of cash it reported holding offshore from $21.1 billion to $42.6 billion, ranking the company 9 for the amount of offshore cash.
Google reported operating 25 subsidiaries in tax havens in 2009, but since 2010 only discloses two, both in Ireland. During that period, it increased the amount of cash it had reported offshore from $7.7 billion to $33.3 billion. An academic analysis found that as of 2012, the 23 no-longer-disclosed tax haven subsidiaries were still operating.
Microsoft, which reported operating 10 subsidiaries in tax havens in 2007, disclosed only five in 2012. During this same time period, the company increased the amount of money it reported holding offshore from $6.1 billion to $60.8 billion in 2012. This sum represents 70 percent of the company’s cash, on which it would owe $19.4 billion in U.S. taxes if the income wasn’t shifted overseas. Microsoft ranks 4 among all top 100 companies for the amount of cash it keeps offshore.
Strong action to prevent corporations from using offshore tax havens will not only restore basic fairness to the tax system, but will also help alleviate America’s fiscal crunch and improve the functioning of markets.
The US is loosing as much as 90 Billion dollars a year in corporate taxes. Why doesn't do something abut it? The lobby efforts of corporate America are deeply in their pockets. They will not close the loop holes because they are receiving their share thru over 5 billion dollars a year in campaign contributions
.
Transfer Pricing- Let the Shell games begin
Definition of 'Transfer Price'- The price at which divisions of a company transact with each other. Transactions may include the trade of supplies or labor between departments. Transfer prices are used when individual entities of a larger multi-entity firm are treated and measured as separately run entities.
Also known as "transfer cost". Transfer pricing is now the shell game is conducted with overseas companies to hide profits off shore.
What defines a "Debt based," economy.
In order for the interest payments to be paid someone else will have to go into debt in order to increase the money supply by the necessary amount. The logical upshot of this system is that it isimpossible for all the money in existence to be paid off because only the principle and never the interest is created. Indeed, as long as interest is charged whenever money is borrowed into existence and money continues to be re-loaned once created, then this process of people needing to continually go into debt to increase the money supply has to continuead infinitum.
Furthermore, due to there always being a persistent shortage of money in the money supply (because the interest is never created alongside the principle and the way in which money flows among people), we are consequently in constant competition with one another as the money in existence is never enough to cover all debt plus interest. This means therefore that competition and bankruptcy and inherent aspects of our monetary system.
Moreover, those that are unfortunate to become bankrupt will lose their assets which are in turn repossessed by the banks which issued the ‘money’ to buy those assets from thin air! Indeed, it should now be apparent that one fundamental consequence of living under a debt-based economy is the invariable law of assets slowly being transferred from us to the banking system through bankruptcies and foreclosures.
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