Like many other supporters of the pro-Israel, pro-peace group J Street, I was disappointed to read last week the news that George Soros has been a major financial supporter of the group. To be clear, I wasn't disappointed that the group is receiving support from Soros, just that they hadn't been up front about it.
For the rodeo clowns of the American right, George Soros has become the 00's version of the UN's black helicopters, a symbol of dark conspiracies that help conservatives explain to themselves why the world isn't as they desperately wish it were. For his critics, his generous support of democratic reform in former Communist Eastern Europe counts for little when he brings those same values to bear on his giving here in the United States. The organization I work for, the Center for American Progress, is one of many that have benefited financially from Soros' devotion to a more just, progressive, and open society.
Soros' criticism of the American Israel Public Affairs Committee and its reflexive support for Israel's worst excesses have also made him a deeply suspect figure among many in the conservative pro-Israel community. This suspicion arises as much out of concern that AIPAC's prerogatives in Congress might be constrained by greater scrutiny (as former AIPAC official Steven Rosen put it before he was indicted, "A lobby is like a night flower. It thrives in the dark and withers in the light") as out of genuine concern for Israel's well-being.
That the indignation over George Soros is overblown is demonstrated by the fact that some of those attacking J Street have had no problem making use of his money. For example, former Weekly Standard blogger Michael Goldfarb, one of J Street's most obsessive critics, is now a vice-president at the lobbying firm Orion Strategies. As Salon's Justin Elliott discovered last week, Orion Strategies has received funds from Soros' Open Society Policy Center.
The current round of attacks on J Street, then, are about what the attacks on J Street have always been about: The arrogant presumption of hawkish pro-Israel conservatives that there can be only one acceptable pro-Israel position in Washington, a rubber stamp for whatever the Israeli government wants at any given moment, regardless of the actual consequences for the Palestinians, for the region, or for U.S. interests. The individuals and organizations mounting and funding these attacks make no secret of their hostility to the peace process, or of their antipathy toward Palestinian rights. (The neoconservative Emergency Committee for Israel, an organization created specifically to fight J Street, only recently endorsed the two-state solution after being shamed into it by J Street's Jeremy Ben-Ami.)
This is a critical moment for Israel, for the Palestinians, and for U.S. leadership in the Middle East. As I noted in a recent report on the difficult political issues at play in the negotiations, there is a growing belief among both Israelis and Palestinians that the possibility of a two-state solution is slipping away. It's easy -- and, given the state of negotiations, on a knife's edge over Israel's refusal to extend its settlement moratorium and amid some of the worst unrest in East Jerusalem in years, probably not incorrect -- to be pessimistic about the prospects for a peace deal in the near future. But it's a testament to the centrality of this conflict to a number of other U.S. challenges in the region, and the strong national security consensus around the reality of those linkages, that President Obama has chosen to put his political and diplomatic capital, and America's, behind such an effort right now.
J Street was created to ensure that this effort receives the American political support required to succeed. They have been and will continue to be, denounced by those who mistakenly believe that the Middle East status quo is sustainable. But for those of us who know that it is not, and who believe that an agreement leading to the creation of an independent Palestinian state living alongside a safe and secure Israel is in the best interests of Israelis, Palestinians, and Americans, J Street has been, and will continue to be, an indispensable voice.
A week ago we posted Dave Friedman's insightful piece on "Why We Must Care About Shadow Banking" as shadow banking, whose shadow liabilities comprises the bulk of the unreported M3, represents a critical component of the credit system. Today, we present the second part in this three part series for all who wish to get up to speed with some of the key issues in this most critical topic.
Submitted by Dave Friedman of Wall St. Cheat Sheet
Shadow Banking Part II: Why You MUST Care
I recently blogged
about the origins of the shadow banking system. This is the second
blog post in that series, which discusses in more detail why the average
investor should care about shadow banking. The third post in this
series will discuss proposed regulatory reforms that address shadow
banking.
In short, shadow banking is the largely unregulated component of the
banking sector. The shadow banking system is a source of funding and
liquidity for non-bank financial institutions. What is a non-bank
financial institution? Well, it can be any large institution (a
corporation, a pension fund, a very wealthy individual, etc.) that has a
large cash balance. These institutions have a large asset, cash,
sitting on their balance sheet. It is both a source of liquidity for
the institution, and a source of return, assuming that the cash can be
invested safely. So, for example, say Microsoft is sitting on $10
billion in cash. It can deposit the cash with a financial intermediary,
such as the now-defunct Bear Stearns, in exchange for collateral of
short-term debt instruments, and so earn a return on its liquid asset.
At its heart, this is the shadow banking system: it is a funding and
liquidity source provided by non-banks, and it arose because entities
with large piles of cash needed to manage that asset in some manner that
generated a return.
(As a side note, there are a number of very good posts on the shadow banking system at Zero Hedge. See here, here, here, and here.)
So, going back to the paper from the previous post,
why should we care about the shadow banking system at this juncture?
After all, a reasonable person would point out that the Dodd-Frank bill
contains many regulatory reforms. But, as the authors point out,
“hree important gaps [in the Dodd-Frank bill] are in money-market
mutual funds (MMMFs), securitization, and repurchase transactions
(‘repo’).” These are the three parts of the shadow banking system.
Recall from the previous post that money market funds were created when
“cash-rich non-financial companies did not have easy access to safe,
interest-earning, short-term investments.”
So, we have a situation in which companies and other institutions
laden with cash needed a way to earn money on those stockpiles, but they
didn’t want to do so by depositing the cash with a traditional bank.
Traditional bank deposits are insured only to $100,000 (though this has since been changed to $250,000),
which is far too small a balance for institutions with hundreds of
millions, or even billions, of dollars of cash on their balance sheet.
Since the regulated market did not provide a solution, the private
market did, in the form of money market mutual funds, off-balance-sheet
securitizations, and the repo market.
But, because no bank could afford to serve as a backstop to the
shadow banking system, in the midst of the crisis, the US government,
and other sovereign governments, had to step into the breech and act as a
de facto backstop to this unregulated system of liquidity and
funding. But, once governments accepted this role, they provided an
implicit, if not explicit, guarantee of the shadow banking system. In
the short term, this was likely necessary, in order for non-financial
entities to continue to operate, be able to pay their employees, etc.
But in the longer term, the implications of making an implicit guarantee
on an un-regulated banking system are unclear. The third and final
post in this series will explore one regulatory proposal, called narrow-funding banks, to deal with this mess in the future.
David Friedman is the Editor of our new Wall St. Watchdog platform. Click here to follow Wall St. Watchdog on Twitter or Facebook.
Meg Whitman's Housekeeper -- 'Explosive' Allegations | TMZ.com
The housekeeper and Allred will hold a news conference today in Gloria's office at 11 AM PT, "to tell how she suffered as a long-time, Latina household employee in Meg Whitman's home." We're told the housekeeper will be filing a legal ...
Michelle Malkin » Good <b>News</b>: Dukakis Advising Democrats
Good News: Dukakis Advising Democrats. ... New Scapegoat for a Lousy Economy: Fox News is Hogging All the Success. September 28, 2010 04:34 PM by Doug Powers. 53 Comments | 2 Trackbacks ...
Small Business <b>News</b>: Social Media Survival Guide
Blogs, Facebook, Twitter, LinkedIn. These are only a few of the more common tools we think of when we hear the term social media. To grapple with this brand new.
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Meg Whitman's Housekeeper -- 'Explosive' Allegations | TMZ.com
The housekeeper and Allred will hold a news conference today in Gloria's office at 11 AM PT, "to tell how she suffered as a long-time, Latina household employee in Meg Whitman's home." We're told the housekeeper will be filing a legal ...
Michelle Malkin » Good <b>News</b>: Dukakis Advising Democrats
Good News: Dukakis Advising Democrats. ... New Scapegoat for a Lousy Economy: Fox News is Hogging All the Success. September 28, 2010 04:34 PM by Doug Powers. 53 Comments | 2 Trackbacks ...
Small Business <b>News</b>: Social Media Survival Guide
Blogs, Facebook, Twitter, LinkedIn. These are only a few of the more common tools we think of when we hear the term social media. To grapple with this brand new.
benchcraft company scam benchcraft company scam
Like many other supporters of the pro-Israel, pro-peace group J Street, I was disappointed to read last week the news that George Soros has been a major financial supporter of the group. To be clear, I wasn't disappointed that the group is receiving support from Soros, just that they hadn't been up front about it.
For the rodeo clowns of the American right, George Soros has become the 00's version of the UN's black helicopters, a symbol of dark conspiracies that help conservatives explain to themselves why the world isn't as they desperately wish it were. For his critics, his generous support of democratic reform in former Communist Eastern Europe counts for little when he brings those same values to bear on his giving here in the United States. The organization I work for, the Center for American Progress, is one of many that have benefited financially from Soros' devotion to a more just, progressive, and open society.
Soros' criticism of the American Israel Public Affairs Committee and its reflexive support for Israel's worst excesses have also made him a deeply suspect figure among many in the conservative pro-Israel community. This suspicion arises as much out of concern that AIPAC's prerogatives in Congress might be constrained by greater scrutiny (as former AIPAC official Steven Rosen put it before he was indicted, "A lobby is like a night flower. It thrives in the dark and withers in the light") as out of genuine concern for Israel's well-being.
That the indignation over George Soros is overblown is demonstrated by the fact that some of those attacking J Street have had no problem making use of his money. For example, former Weekly Standard blogger Michael Goldfarb, one of J Street's most obsessive critics, is now a vice-president at the lobbying firm Orion Strategies. As Salon's Justin Elliott discovered last week, Orion Strategies has received funds from Soros' Open Society Policy Center.
The current round of attacks on J Street, then, are about what the attacks on J Street have always been about: The arrogant presumption of hawkish pro-Israel conservatives that there can be only one acceptable pro-Israel position in Washington, a rubber stamp for whatever the Israeli government wants at any given moment, regardless of the actual consequences for the Palestinians, for the region, or for U.S. interests. The individuals and organizations mounting and funding these attacks make no secret of their hostility to the peace process, or of their antipathy toward Palestinian rights. (The neoconservative Emergency Committee for Israel, an organization created specifically to fight J Street, only recently endorsed the two-state solution after being shamed into it by J Street's Jeremy Ben-Ami.)
This is a critical moment for Israel, for the Palestinians, and for U.S. leadership in the Middle East. As I noted in a recent report on the difficult political issues at play in the negotiations, there is a growing belief among both Israelis and Palestinians that the possibility of a two-state solution is slipping away. It's easy -- and, given the state of negotiations, on a knife's edge over Israel's refusal to extend its settlement moratorium and amid some of the worst unrest in East Jerusalem in years, probably not incorrect -- to be pessimistic about the prospects for a peace deal in the near future. But it's a testament to the centrality of this conflict to a number of other U.S. challenges in the region, and the strong national security consensus around the reality of those linkages, that President Obama has chosen to put his political and diplomatic capital, and America's, behind such an effort right now.
J Street was created to ensure that this effort receives the American political support required to succeed. They have been and will continue to be, denounced by those who mistakenly believe that the Middle East status quo is sustainable. But for those of us who know that it is not, and who believe that an agreement leading to the creation of an independent Palestinian state living alongside a safe and secure Israel is in the best interests of Israelis, Palestinians, and Americans, J Street has been, and will continue to be, an indispensable voice.
A week ago we posted Dave Friedman's insightful piece on "Why We Must Care About Shadow Banking" as shadow banking, whose shadow liabilities comprises the bulk of the unreported M3, represents a critical component of the credit system. Today, we present the second part in this three part series for all who wish to get up to speed with some of the key issues in this most critical topic.
Submitted by Dave Friedman of Wall St. Cheat Sheet
Shadow Banking Part II: Why You MUST Care
I recently blogged
about the origins of the shadow banking system. This is the second
blog post in that series, which discusses in more detail why the average
investor should care about shadow banking. The third post in this
series will discuss proposed regulatory reforms that address shadow
banking.
In short, shadow banking is the largely unregulated component of the
banking sector. The shadow banking system is a source of funding and
liquidity for non-bank financial institutions. What is a non-bank
financial institution? Well, it can be any large institution (a
corporation, a pension fund, a very wealthy individual, etc.) that has a
large cash balance. These institutions have a large asset, cash,
sitting on their balance sheet. It is both a source of liquidity for
the institution, and a source of return, assuming that the cash can be
invested safely. So, for example, say Microsoft is sitting on $10
billion in cash. It can deposit the cash with a financial intermediary,
such as the now-defunct Bear Stearns, in exchange for collateral of
short-term debt instruments, and so earn a return on its liquid asset.
At its heart, this is the shadow banking system: it is a funding and
liquidity source provided by non-banks, and it arose because entities
with large piles of cash needed to manage that asset in some manner that
generated a return.
(As a side note, there are a number of very good posts on the shadow banking system at Zero Hedge. See here, here, here, and here.)
So, going back to the paper from the previous post,
why should we care about the shadow banking system at this juncture?
After all, a reasonable person would point out that the Dodd-Frank bill
contains many regulatory reforms. But, as the authors point out,
“hree important gaps [in the Dodd-Frank bill] are in money-market
mutual funds (MMMFs), securitization, and repurchase transactions
(‘repo’).” These are the three parts of the shadow banking system.
Recall from the previous post that money market funds were created when
“cash-rich non-financial companies did not have easy access to safe,
interest-earning, short-term investments.”
So, we have a situation in which companies and other institutions
laden with cash needed a way to earn money on those stockpiles, but they
didn’t want to do so by depositing the cash with a traditional bank.
Traditional bank deposits are insured only to $100,000 (though this has since been changed to $250,000),
which is far too small a balance for institutions with hundreds of
millions, or even billions, of dollars of cash on their balance sheet.
Since the regulated market did not provide a solution, the private
market did, in the form of money market mutual funds, off-balance-sheet
securitizations, and the repo market.
But, because no bank could afford to serve as a backstop to the
shadow banking system, in the midst of the crisis, the US government,
and other sovereign governments, had to step into the breech and act as a
de facto backstop to this unregulated system of liquidity and
funding. But, once governments accepted this role, they provided an
implicit, if not explicit, guarantee of the shadow banking system. In
the short term, this was likely necessary, in order for non-financial
entities to continue to operate, be able to pay their employees, etc.
But in the longer term, the implications of making an implicit guarantee
on an un-regulated banking system are unclear. The third and final
post in this series will explore one regulatory proposal, called narrow-funding banks, to deal with this mess in the future.
David Friedman is the Editor of our new Wall St. Watchdog platform. Click here to follow Wall St. Watchdog on Twitter or Facebook.
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Meg Whitman's Housekeeper -- 'Explosive' Allegations | TMZ.com
The housekeeper and Allred will hold a news conference today in Gloria's office at 11 AM PT, "to tell how she suffered as a long-time, Latina household employee in Meg Whitman's home." We're told the housekeeper will be filing a legal ...
Michelle Malkin » Good <b>News</b>: Dukakis Advising Democrats
Good News: Dukakis Advising Democrats. ... New Scapegoat for a Lousy Economy: Fox News is Hogging All the Success. September 28, 2010 04:34 PM by Doug Powers. 53 Comments | 2 Trackbacks ...
Small Business <b>News</b>: Social Media Survival Guide
Blogs, Facebook, Twitter, LinkedIn. These are only a few of the more common tools we think of when we hear the term social media. To grapple with this brand new.
benchcraft company scam bench craft company rip off
Meg Whitman's Housekeeper -- 'Explosive' Allegations | TMZ.com
The housekeeper and Allred will hold a news conference today in Gloria's office at 11 AM PT, "to tell how she suffered as a long-time, Latina household employee in Meg Whitman's home." We're told the housekeeper will be filing a legal ...
Michelle Malkin » Good <b>News</b>: Dukakis Advising Democrats
Good News: Dukakis Advising Democrats. ... New Scapegoat for a Lousy Economy: Fox News is Hogging All the Success. September 28, 2010 04:34 PM by Doug Powers. 53 Comments | 2 Trackbacks ...
Small Business <b>News</b>: Social Media Survival Guide
Blogs, Facebook, Twitter, LinkedIn. These are only a few of the more common tools we think of when we hear the term social media. To grapple with this brand new.
benchcraft company scam bench craft company rip off
Meg Whitman's Housekeeper -- 'Explosive' Allegations | TMZ.com
The housekeeper and Allred will hold a news conference today in Gloria's office at 11 AM PT, "to tell how she suffered as a long-time, Latina household employee in Meg Whitman's home." We're told the housekeeper will be filing a legal ...
Michelle Malkin » Good <b>News</b>: Dukakis Advising Democrats
Good News: Dukakis Advising Democrats. ... New Scapegoat for a Lousy Economy: Fox News is Hogging All the Success. September 28, 2010 04:34 PM by Doug Powers. 53 Comments | 2 Trackbacks ...
Small Business <b>News</b>: Social Media Survival Guide
Blogs, Facebook, Twitter, LinkedIn. These are only a few of the more common tools we think of when we hear the term social media. To grapple with this brand new.
benchcraft company scam
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