Loans Borrowed Against Pensions Squeeze Retirees with their high interest rates; “It’s simply a terrible deal”

April 27, 2013

Loans Borrowed Against Pensions Squeeze Retirees

By JESSICA SILVER-GREENBERG

To retirees, the offers can sound like the answer to every money worry: convert tomorrow’s pension checks into today’s hard cash. But these offers, known as pension advances, are having devastating financial consequences for a growing number of older Americans, threatening their retirement savings and plunging them further into debt. The advances, federal and state authorities say, are not advances at all, but carefully disguised loans that require borrowers to sign over all or part of their monthly pension checks. They carry interest rates that are often many times higher than those on credit cards. In lean economic times, people with public pensions — military veterans, teachers, firefighters, police officers and others — are being courted particularly aggressively by pension-advance companies, which operate largely outside of state and federal banking regulations, but are now drawing scrutiny from Congress and the Consumer Financial Protection Bureau. The pitches come mostly via the Web or ads in local circulars. Read more of this post

Matt Taibbi: Everything Is Rigged: The Biggest Price-Fixing Scandal Ever

Everything Is Rigged: The Biggest Price-Fixing Scandal Ever

The Illuminati were amateurs. The second huge financial scandal of the year reveals the real international conspiracy: There’s no price the big banks can’t fix

by MATT TAIBBI

APRIL 25, 2013

Conspiracy theorists of the world, believers in the hidden hands of the Rothschilds and the Masons and the Illuminati, we skeptics owe you an apology. You were right. The players may be a little different, but your basic premise is correct: The world is a rigged game. We found this out in recent months, when a series of related corruption stories spilled out of the financial sector, suggesting the world’s largest banks may be fixing the prices of, well, just about everything.

You may have heard of the Libor scandal, in which at least three – and perhaps as many as 16 – of the name-brand too-big-to-fail banks have been manipulating global interest rates, in the process messing around with the prices of upward of $500 trillion (that’s trillion, with a “t”) worth of financial instruments. When that sprawling con burst into public view last year, it was easily the biggest financial scandal in history – MIT professor Andrew Lo even said it “dwarfs by orders of magnitude any financial scam in the history of markets.”

That was bad enough, but now Libor may have a twin brother. Word has leaked out that the London-based firm ICAP, the world’s largest broker of interest-rate swaps, is being investigated by American authorities for behavior that sounds eerily reminiscent of the Libor mess. Regulators are looking into whether or not a small group of brokers at ICAP may have worked with up to 15 of the world’s largest banks to manipulate ISDAfix, a benchmark number used around the world to calculate the prices of interest-rate swaps. Read more of this post

Bitcoin: the Berlin streets where you can shop with virtual money; “There is no middle man involved.. I like the fact that Bitcoin scares people in suits, because if this thing were to really take off, it would bankrupt a lot of bankers.”

Bitcoin: the Berlin streets where you can shop with virtual money

The digital currency is rising in popularity among traders in the rebellious Kreuzberg area of Germany’s capital

Kate Connolly and Guy Grandjean in Berlin

guardian.co.uk, Friday 26 April 2013 11.08 BST

In Kreuzberg, Berlin, Bitcoin has expanded off the internet into the local economy.Link to video: Bitcoin: world’s fastest growing currency migrates off the internet

Nadim Chebli remembers well the first of his customers who decided to pay for the records they bought with virtual currency rather than cash or credit cards. “I’d only just agreed to accept Bitcoins,” said the 36-year-old owner of the Long Player record shop, “and the first sales I made in it came pretty quickly, from a guy about my age who bought Tom Waits’s The Big Time and a young woman who bought a Beatles compilation from 1967.” In the few months since Chebli signed up to the peer-to-peer electronic cash system, he finds it hard to come up with definitive characteristics for the “typical” Bitcoin user who walks off the street into what he describes as his “vinyl living room”. “There’s no typical age group, or sex, just, well, regular folk,” he said. Florentina Martens has had the same experience since opening her Parisian-style cafe Floor’s two months ago just a couple of streets away. “There is not a prototype Bitcoin payer,” she said. “It’s random people. Not only nerds, let me put it that way.”

Like Chebli, Martens, whose Kersenvlaai (cherry cake) from her native Maastricht is rated as one of the best culinary offerings of the area, says she decided to accept Bitcoins because of the ease, cheapness and transparency of its payment system. “It’s an easier way of digital payment than credit cards, which cost me a lot of money as a business and to which I’m forced to sign up for years,” she says. Read more of this post