Democracy is Undermined by the Financial Sector by Prof. Marc Cheney

Democracy is Undermined by the Financial Sector By Finance Professor Marc Chesney [This article published on August 20, 2019 is translated from the German on the Internet, www.infosperber.ch.] “The power of the markets undermines democracy,” Chesney concludes in his book “The Permanent Crisis – The Rise of the Financial Oligarchy and the Breakdown of Democracy.” He explains who are the markets often extolled in the daily papers and not only in the stock market reports. “Investment banks and speculative funds” manipulate or try to manipulate markets (the big exchanges in New York and Chicago leading the way) to strike it rich. They operate a gambling casino where financial transactions are handled at ever-faster speed as micro-second trading. The power of these “markets” contradicts the basic principles of democracy. “The electronic financial markets determine the economic, financial and social orientation of countries.” Both left-wing and right-wing politics must submit to the financial markets. “This amounts to a form of dictatorship,” declared Marc Chesney. Therefore, “the choice today is between the dictatorship of the financial sector and a democracy where citizens take the future in their hands.” Financial sector eludes democratic control Chesney recalls a quotation from the first half of the 20th century attributed to the automillionaire Henry Ford. “It is good that the population of this nation does not understand the banking- and money system. If they understood this, we would probably have a revolution tomorrow morning.” This is truer today than ever, Chesney says. “The financial sector actually tries to evade all democratic controls by its sheer size and inscrutability.” Big banks can operate a financial casino since “their CEOs assume the bank does not need to answer for the risks.” As then, the taxpayers may have to bailout the distressed big banks today (eg. UBS and Credit Suisse)… The gambling casino The system risk of a big bank is hard to describe. Big banks hide their high-risk gambling… In 2017, Credit Suisse had an incredible volume of 28 trillion francs with socalled derivatives… Only 0.2 percent of this astronomical 28 trillion serve real insurance functions. The rest are pure bets of a casino world of finance and market manipulators that only bring dangers and no benefits to the real economy. “Who can believe the situation is under control?” Chesney asks. Derivatives