Wednesday, March 25, 2009

Private global corporations. Public and national bailouts.

Questions: How is it that national governments are organising for the protection of deeply-malfunctioning transnational corporations and their global conglomerates? Are these institutions being asked to give their rather considerable (domestic and international) assets to the national taxpayers who are funding them?

Why have the large troubled banks continued to purchase huge overseas enterprises even in the context of their obvious financial vulnerability? Who in the world is responsible for proper oversight of their contemporary acquisitorial dealings?

2001 - Citi became the owner of 23.2% of the Mexican loan market through its acquisition of Banamex. This came about because of the conditions imposed by the IMF and the US on the 1994 Mexican bailout package.[1]

2006 – June. Explaining premiums in restricted DR (depository Receipt) markets and their implications: the case of Infosys. Morgan Stanley has significant investments in this [Indian] firm.

2007 – October 4th. Citigroup lends to KKR to buy Citigroup’s Loans. (snake eating its tail).

2007 - October 9th. Chinese Corporations owned by Goldman Sachs

"...The consortium - CDH Investments has a takeover vehicle called Rotary Vortex in which Goldman holds a 46% stake (2007). Rotary Vortex acquired full control of Shineway Group, owner of China’s largest meat processor, from state-backed interests in China following a year of regulatory scrutiny...[2]

2007 – October 10th. A consortium made up of a fund advised by JP Morgan Asset Management and Australia’s Challenger Infrastructure fund as well as the merchant bank UBS buys Southern Water which is the 7th largest water and sewage company in England and Wales which provides water for 2.3 million people and waste water services to 4.3 million customers. This acquisition involves the taking on of 2.8billion pounds of debt. The consortium is called ‘The Greensands consortium of infrastructure investors and pension funds’. The balance will be held by a series of Australian pension funds, Hermes, which is owned by the BT pension scheme and infrastructure investor Paceweald (linked to Vincent Tchenguiz’s Consensus Business Group which, in turn, has a stake in Challenger). [3]

2007 – October 17th. JP Morgan “has gobbled up Chase Manhatten, Manufacturers Hanover, Chemical Bank, Bank One and more over the past two decades….”

2008 – October 3rd. Mitsubishi UFJ Financial Group Inc.'s $9 billion investment in Morgan Stanley

2009 – January 16th. Carlyle, TPG, KKR Bid for AIG Aircraft-Leasing Unit. The world’s buyout firms are looking for ways to put their estimated $400 billion of committed capital to work after the global credit crisis restricted leveraged lending and reduced LBOs by about 70 percent last year. Forced sales by financial companies may provide some of the best opportunities. “You have a situation where there’s a distressed seller and these are the times when private-equity funds get their best returns.”

2009 – February 5th. Executives at Goldman Sachs Group Inc., JPMorgan Chase & Co. and hundreds of financial institutions receiving federal aid aren’t likely to be affected by pay restrictions announced yesterday by President Barack Obama.[4]

[1] Excerpt from "Wall Street and Immigration: Financial Services Giants Have Profited from the Beginning," Peter Cervantes-Gautschi, December 4, 2007, Americas Policy Program, Center for International Policy (CIP)

[2] By Sundeep Tucker in Hong Kong
Published: October 9 2007 22:18 | Last updated: October 10 2007 05:40

[3] JP Morgan consortium buys Southern Water
· £4bn paid for Kent, Sussex and Hampshire utility
· New owners refuse to rule out job cuts
Mark Milner, industrial editor. * The Guardian * Wednesday October 10 2007

[4] Goldman, JPMorgan Exempt From Exec Salary Caps
Published on 02-05-2009 Source: Bloomberg


Myrtle Blackwood said...

More questions. Who will tally what proportion of Citigroup (and co's) neck has been saved by Australian, English, Chinese, Mexican (etc) taxpayers?

Will the people of Britain get their water commons back? Will the agricultural land in Australia and Mexico be freed up for small family farms again? Will the biggest woodchipper in the Southern Hemisphere (Gunns ltd, partially owned by a group of global banks) be permitted to go broke and thus allow the forests to be spared from napalm fueled clearfelling infernos?

Ariel Ky said...

These bailouts are monstrous, enabling a criminal banking and finance cartel to dominate the financial world and global economy. A good place to begin to understand the full planetary sweep of their scams, is to look at BCCI and how the Carlyle Group continue their modus operandi. And there is nobody to stop them because they have corrupted the top officials in just about every damned country in the world. Where they can't buy key people, they blackmail or threaten... and they've got control of the U.S. military to back up their threats. I know this all sounds so science fiction, so implausible... but I'm willing to listen to other explanations of what is happening.