Showing posts with label Economics and Finance. Show all posts
Showing posts with label Economics and Finance. Show all posts

August 9, 2018

Trump’s reflexive impulse to reach for superlatives will doom his Iran sanctions regime

    Thursday, August 09, 2018   No comments

Trump’s inclination to invoke superlatives to demean persons he does not like and to praise himself or persons he likes is well documented. Almost all his short and long statements would include some superlatives.

October 19, 2016

What qualifies financial services or products to be sharia-compliant?

    Wednesday, October 19, 2016   No comments
Economists specializing in the study of Islamic finance and economics have reduced Islamic laws governing financial and economic transactions to two: proscription on receiving or paying “interest” and mandating that investors and developers (lenders and borrowers) share the gains and losses of the enterprise in which they are more or less partners. This theory is widespread but it is based on a very basic, and perhaps outdated, understanding of the primary sources of classical Islamic law. Moreover, most of the works and publications advancing this perspective are built on secondary sources and rarely engage primary materials. This essay challenges the ideas and approaches behind this perspective and proposes a model that takes into consideration the need to protect the poor and the desire to make profit, which is the motivating force behind a thriving economy.

While Islamic scriptures clearly prohibit profiting from the poor, supposedly sharī'ah-compliant Islamic financial and exchange laws circumvent prohibitions and limitations on ribā, monopolism, debt, and risk while failing to address the fundamental purpose behind the prohibitions—mitigating poverty. This study provides a historical survey of the principles that shape Islamic finance and exchange laws, reviews classical and modern interpretations and practices in the banking and exchange sectors, and suggests a normative model rooted in the interpretation of Islamic sources of law reconstructed from paradigmatic cases. Financial systems that overlook the nexus between poverty and usury harm both the economy and poor and middle class consumers and investors rather than addressing the causal relationship between interest-charging models and poverty. This study shows how Islamic Financial Institutions (IFIs) have failed to meet the social requirements they were intended to address and also presents a theoretical framework for Islamic finance and exchange laws that proscribes usurious transactions involving people caught in the cycle of poverty and need.
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September 4, 2016

Review of the 2016 G20 summit in China

    Sunday, September 04, 2016   No comments
Leaders of counties that are said to be the top 20 economies in the world met this weekend in China. We would like to summarize what happened and where each country stands--literally--relative to key global issues. It is said that a picture is more eloquent than a thousand words. In this particular case, the photo does in fact say it all. So here is our review in one thousand words:

...
Need help with context, consider Christopher Miller's interpretation of the same photo:


August 11, 2016

Turkish and Russian leaders can no longer compartmentalize their relations

    Thursday, August 11, 2016   No comments
by Ahmed E. Souaiaia*

Turkey’s president may have pushed the reset button of his country’s relations with Russia, but it will be a while before he can reap economic benefits.
 
Reason for Putin wanting gradual restoration of economic ties with Turkey: Russia cannot help rejuvenate the Turkish economy to enable the Turkish government to kill Russian soldiers (and abuse their corpses) in Syria by proxies

In 2011, the sudden protest movement popularly known as the Arab Spring triggered fundamental changes in the political and social landscapes of the Middle East—not just the Arab world as the name suggests. Turkey’s government, like many others around the world, did not know how to react at first. Erdoğan, as his country’s prime minister and then president, supported the Tunisian revolution, wavered in his support for the Egyptian president before committing to supporting the Muslim Brotherhood, and opposed NATO’s war on Libya’s Muammar Qaddafi. When peaceful protesters took the streets in some Syrian cities, Erdoğan, relying on a sectarian instinct and a nationalist impulse, offered Assad fifteen days to meet the protesters’ demands before he would cut all relations and put all his weight behind the Syrian opposition forces. A few weeks later, Turkey played a pivotal role in using Qatari and Saudi money and weapons to transition the protest movement into an armed rebellion committed to a single objective: overthrowing Bashar al-Assad. This role, to which Erdoğan committed himself, necessarily created a conflict for him with two other powerful neighbors and economic partners: Russia and Iran.
For the first four years of the Syrian crisis, the leaders of Turkey, Iran, and Russia thought that they could compartmentalize their relations. They could continue to strengthen their economic ties, while agreeing to disagree on Syria. That approach failed when it became clear that the differences between Turkey on one hand, and Russia and Iran on the other, in relation to Syria were more than disagreements. Iran and Russia have had long-standing strategic alliances with Syria for many years. In fact, two years earlier, Iran had signed a security deal with Syria that required each of them to come to the aid of the other should one be attacked. Russia has had a naval base in Syria since the days of the Soviet Union. With that being the case, it was not possible to compartmentalize, especially when all three countries were committed to preserving their interests in Syria and in the region.
So it was no surprise that all three countries were actively involved in Syria beyond what they publicly revealed. Russia and Iran first provided the Syrian government with weapons and economic assistance to help it weather the crisis, but Turkey took a direct role from the start of the conflict and allowed the free flow of weapons and fighters into Syria. By 2015, all three countries increased their involvement. Turkey provided training, control and command centers, and free flow of weapons and fighters to the opposition groups. Russia and Iran sent more military hardware and eventually fighter jets and military personnel to Syria. That escalation led to the crucial mistake on the part of the Turkish leaders.
Hoping to draw NATO deeper in the Syrian conflict, Erdoğan ordered a Russian bomber shot down. The crew ejected, but one member was killed by an armed group supported by Turkish security forces and partially staffed by Turkish citizens. This incident prompted President Putin to impose harsh economic sanctions that further stressed the slumping Turkish economy. Russia’s economic, rather than military, response to what they saw as an act of war rendered NATO useless in terms of assisting Turkey. Putin then insisted that economic sanctions would stay in place and might even be tightened unless Erdoğan formally apologized and took responsibility for downing the Russian fighter jet and killing the pilot. Erdoğan insisted that it was Putin who should apologize for violating Turkish airspace. Seven months later, with the Turkish economy in decline, Erdoğan sent a letter to Putin expressing sorrow and taking responsibility for the incident. Russian leaders welcomed the gestures and promised to ease some of the sanctions. But Erdoğan wanted more than easing the sanctions—he needed economic relations between the two countries to be restored to the pre-incident period or better. So he requested an earlier meeting with Putin than the one scheduled to happen on the sidelines of the G-20 in China in September of this year. Putin obliged and offered to meet him in Saint Petersburg on August 9.
Erdoğan’s eagerness to meet with his Russian counterpart was motivated by economic considerations, with all other interests being secondary. Russian leaders are also interested in boosting economic ties, but not in a way that will undercut their broader interests in the region. Consequently, the two sides went into the meeting with different priorities. However, it is clear that the Turkish side lacks the strategic thinking that would allow them to see the connection between the Syrian crisis and their national economic conditions. The Turkish economy’s growth was cut by almost 50% immediately after the Syrian crisis, and that correlation alone should be enough to convince Turkish leaders to address both their economic concerns and the Syrian crisis at the same time, not in isolation from one another. Failure to do so soon will undo the possible benefits of the apology.
There is a reason Erdoğan is widely popular in Turkey: since he and his party, AKP, won the first elections that allowed them to govern without the need for a coalition for nearly a decade and a half, he turned a slumping economy with a negative GDP growth rate—-5.7 in 2001—into a formidable global force. He attracted investors, rebuilt the infrastructure, and turned Turkey into a magnet for businesspersons and tourists. The results were impressive: Between 2002 and 2011, Turkey’s average GDP growth rate was 5.45.
The average GDP  in the last four years, since the start of the so-called Arab Spring (2012-2015), barely reached 3.33. The numbers for 2016 are worrisome. Turkey’s problem became tied to the Syrian crisis when Erdoğan took it upon himself to be the defender of the Syrian people against their own president: he threw his support behind violent groups allowing the flow of weapons and fighters into that country with the aim of overthrowing Assad’s government. Given the long-standing relationship between Russia and Syria, Turkish-Russian relations suffered, especially when Turkey shot down a Russian Su-24 near its border with Syria . The connections between the Syrian crisis, Turkey’s relations with Russia, and the health of the Turkish economy are compelling . Although Russia would benefit from economic ties with Turkey, Russian leaders have made the connection between long-term economic development and strategic alliances with other countries. With Russia soldiers now dying in Syria on the hands of fighters enabled, trained, and supported by Turkey, it would be reckless for Russia to fully separate economic interests and military and security matters involving Turkey. That is one of the main reasons Erdoğan returned from Russia practically empty handed, with only promises.
Russia will not shore up a Turkish economy that supports terrorists in Syria who killed Russian soldiers, abused their corpses, and threaten to kill more. For that reason, Putin insisted that the lifting of sanctions must be gradual. Russian thinking is long term: if Putin waited for seven months to receive Erdoğan’s apology, he is prepared to wait another seven months to see Turkey implement its commitments to fighting terrorism by sealing the border and stopping the flow of weapons, fighters, and stolen Syrian oil and goods.
Russians are prepared to fast-track the economic projects that are long term and delay the ones with immediate payoff for the Turkish economy until Turkey meets its obligations. Russia’s thinking was reflected in their plan to restart work on Turkish Stream pipeline, without shelving alternative projects involving other countries. The principle that Russian leaders are using to reset their relations with Turkey also favors restarting economic exchange that benefits the Russian economy and while delaying exchange that benefits the Turkish economy until Turkey changes its calculus on Syria. Russia is not conditioning its economic relations with Turkey on Syria because it cares about Assad, but because Turkey is indirectly killing Russians in Syria.
The other principle guiding Russia’s foreign policy in relation to the Syrian crisis was made clear during the press conference that Erdoğan and Putin held after their first meeting. Responding to the first question, Putin looked at his guest and declared:
“Our position is based on this enduring principle: It is impossible to achieve democratic change except through democratic means.”
Not only are these principles guiding Russia’s approach to the Syrian crisis making it difficult for Erdoğan to capitalize on his pragmatism, the consequences of his involvement in Syria are making it almost impossible to start from zero. Indeed, making amends for one jet and one pilot may cost him some political capital and about $25 million. Should Syria pursue legal action to force countries that supported military aggression and profited from looted goods and natural resources to pay reparations, Turkey could be on the hook for billions. Erdoğan was willing to apologize and normalize relations with Putin but not with not Assad because of the cost that might be associated with admission of responsibility in the destruction of Syria.
This is not to say that Turkey has no way out of its problem with Syria. Erdoğan could use Russia as intermediate partner to spend the next five years rebuilding what he helped destroy in Syria over the past five years. This indirect action could be the compromise that might actually work for all parties. The “coup” that Erdoğan wanted to launch against the Syrian government using genocidal fighters did not work, will not work, and may have inspired the failed coup against his government. He has this one opportunity that he had created when he apologized and took responsibility for downing the Russian plane; if unused, all will be for naught.
___________________________
* Prof. SOUAIAIA teaches at the University of Iowa. His most recent book, Anatomy of Dissent in Islamic Societies, provides a historical and theoretical treatment of rebellious movements and ideas since the rise of Islam. Opinions are the author’s, speaking on matters of public interest; not speaking for the university or any other organization with which he is affiliated.


July 7, 2016

#IslamicSocietiesReview : Turkish-Russian relations in the context of the war in Syria and Turkish economy

    Thursday, July 07, 2016   No comments


by Ahmed E. Souaiaia*

At one point last year, when the Turkish and Russian leaders had their last meeting, they had hoped that economic trade between their two countries would reach $100 billion. Turkish leaders also wanted to triple trade with Iran to $30 billion. Erdogan, the co-founder of the AKP that has governed Turkey for a decade and a half, knows the importance of economic growth for him to remain in power and shape the country’s future to his liking.

July 30, 2015

Beyond terrorism: Sousse attack, economic development, fair trade, and dignity

    Thursday, July 30, 2015   No comments
by Ahmed E. Souaiaia*


The intent of those who planned and carried out the recent terrorist attack in Tunisia and the reactions to it, both underscore the idiosyncratic connections between economic development and terrorism. Importantly, the attack ought to remind us of the global nature and imperatives, not only of ISIL’s brand of terrorism, but also of economic development. Both problems, terrorism and lack of economic development in the Global South, must be confronted cooperatively, because European countries were indeed involved, directly and indirectly, in creating the kind of conditions that weaken their southern neighbors’ economies, which in turn have created the kind of environment most suitable for terrorism.


Zakaria Hamad
When 30 British citizens vacationing in the city of Sousse, Tunisia, were killed along with three Irish, two Germans, one Belgian, one Portuguese, and one Russian, the Foreign Office ordered all but essential travelers to leave that country immediately. Habib Essid, Tunisia’s Prime Minister, said that his government would help to evacuate approximately 3,000 Britons, but told Tunisia’s parliament that he was “dismayed by the advice from the Foreign Office.” The Tunisian government said the UK “was damaging the country’s economy,” which is heavily reliant on tourism, and may end up inadvertently fueling poverty and therefore terrorism. Oliver Miles, a former UK ambassador to Libya and Greece “found the [UK]’s response puzzling.” Other commentators and international affairs analysts contended that Britain was “wrong to bring tourists home” because it would weaken the only true emerging democracy in that part of the world.

April 13, 2014

Is Ukraine becoming for the West what Syria has been for Russia?

    Sunday, April 13, 2014   No comments





Riding the wave of protests known as the Arab Spring, many Syrians rallied to demand more political and civil rights. Without the hesitancy that characterized their initial reaction to the protest movements in Tunisia and Egypt, Western administrations and some of the Persian Gulf regimes immediately threw their support behind the protesters. Assad’s regime belonged to the so-called non-moderate Arab governments and the protesters offered the West and its allies an opportunity to overthrow it. They formed the “Friends of Syria” group, now consisting of only eleven nations, to provide the opposition with all needed support, including deadly arms, to achieve that goal. After three years of brutal war, Syria’s economy and society are severely damaged and its allies, mainly Russia, China, and Iran have invested a huge political, economic, and military capital to help the Syrian government survive. The Friends of Syria claimed that Assad became illegitimate because he killed Syrians. Assad claimed that he was fighting armed terrorists and thugs.

Now fast-forward to 2013. 

May 9, 2013

To compete globally, BRICS nations need reputation, not imitation

    Thursday, May 09, 2013   No comments


by Ahmed E. Souaiaia* 

BRICS nations
The economic, political, and social rise of the Western block of nations was founded on the single most enduring currency: reputation. Reputation, the source of credibility and trust, is the real asset that allows the U.S. to project its stature around the world. BRICS nations cannot rise to prominence by mimicking developed countries. They must build their reputation first. Wealth is only a byproduct of this more precious commodity, and countries who have it can squander it just as emerging economies can acquire it. For either of those results to happen in any country, circumstantial conditions and principled actions must converge.

March 27, 2012

Burdening the victims: impact of US sanctions on human rights at home and abroad

    Tuesday, March 27, 2012   No comments
The case for peoples' diplomacy


On the occasion of the start of the Persian New Year (Nowrūz), President Obama delivered a recorded video message to the Iranian people. In it, he highlighted the many ways the Iranian government denies its citizens access to information, including censoring media outlets and filtering the Internet. He declared that his administration is committed to communicating with the Iranian people despite the objections of their government “by making it easier for Iranian citizens to get the software and services they need to connect with the rest of the world through modern communications methods.”

As a candidate, Obama insisted—despite harsh criticism from other presidential candidates— that he would reach out to the Iranian leaders and talk to them in order to end the 30 year cold war. During his first year in office, President Obama offered to start a conversation with the Iranian leadership based on mutual respect. He then sent a letter, whose content was not disclosed, to the leader of the revolution, Ayatollah Seyed Ali Hosseini Khamenei. As his first term in office ends, having failed to start any significant dialogue with the Iranian regime, the President outlined a new strategy designed to bypass the Iranian government and religious leaders and talk to the Iranian people directly. Will this strategy succeed? Unlikely; and here are several compelling reasons.

January 21, 2012

Class warfare or economic justice?

    Saturday, January 21, 2012   No comments
When Romney resisted releasing his tax records unless he becomes the GOP nominee, the discussion that was started by the Occupy movement found new life. The fundamental issue is fairness in the U.S. economic system—not class warfare, as some would like to characterize it. Many in the Occupy movement believe that corporate influence in the political process unfairly disadvantages working people and rewards greed. One of the areas unfairly influenced by wealthy corporations and persons is the tax code. Many Occupiers want that system reformed.
The 1% have the means to not only influence the debate, but to buy the political leverage necessary to secure favorable outcomes. The absolute majority of the 99% want a fair system that neutralizes these influences. They don't want giveaways from the 1% and they are not opposed to capitalism and private property ownership.

The NYT reported that Mitt Romney, for instance, “has called for keeping the current low rates for capital gains and eliminating capital gains altogether for taxpayers making less than $200,000.” Joe Scarborough, a conservative commentator and former lawmaker, defended the low 15% percent tax rate paid by Romney and other wealthy individuals by suggesting that the money taxed at the 15% rate is actually taxed twice: first it is taxed as income at a higher rate and then taxed again as investment income. That is a disingenuous and misleading characterization of the facts. Here is why:
Let's say a hardworking Joe makes $100,000 a year. That income will be taxed at a rate closer to 35% than to 15%. After years of hard work, Joe saves $50,000, which he invests. At the end of the year, Joe receives a statement showing that he earned $2500 through capital gains, dividends, interest, etc. Only the $2500 Joe earned on top of his original investment of $50,000 will be taxed at the 15% rate; Joe is not taxed at a 15% rate on $52,500 (his original investment plus his gains). So there is no double taxation.
Now let's look at another scenario. John is a software engineer who has worked for Microsoft since the early 1990's. John's yearly salary is about $67,000. But when John was hired, he took the stock option the company offered its employees, which consisted of 5000 shares priced at $5 a share. After more than five years, John was able to sell these shares for the market value of $300 per share (a gross sale value of $1,500,000). The net income (after deduction for cost and fees) is taxed only once, at the 15% rate. Furthermore, it is only taxed the year it is sold, not every year John saw gains through increase in stock prices.
Let's look at a third example. Brinn is a programming guru. He quit school to start an Internet company. His company was so successful he valued it at $1,000,000 and made it a public company. Before the initial IPO, Brinn decided arbitrarily to fix the value of each share in his company at $1. Now Brinn's company is available for public trade, but not before he reserved 500,001 shares for himself and 200,000 shares for his employees or his favorite charity. Brinn is now the CEO of the new public company, too. He decides that he will receive $1 a year in salary, but will receive additional compensation in the form of stock options. 
Because Brinn's company is awesome, everyone wants in. Joe used some of his saved money to place a bid to buy some shares. Before Joe is able to fulfill his order, the price of a single share in Brinn's company jumps to $50. Suddenly, Joe becomes the proud owner of 100 shares costing him about $5000, which drives Brinn's wealth to over $25,000,000. 
Five years later, Joe sells his 100 shares at $100 per share (earning about $5000 on top of his original investment). Brinn, on the other hand, earns $50 million. He will pay the 15% tax rate on those earnings, because he does not have to claim it as earned salary income on his tax return. That is a best case scenario. Another equally likely scenario is this: after five years, Joe is forced to sell his shares to pay for an unexpected event. Although the price of the stock was up at some point near $100, when Joe needed to the cash however, the stock was $48 per share. Joe lost $200 in this investment. Brinn is still $47 per share ahead.

Capital venture investors use a multitude of methods to avoid paying the higher tax rate that 99% of monthly wage earners must pay. Stock options, property reclassification, tax shelters, and charitable donations are just few ways they control their wealth and avoid paying higher taxes. Business professionals have access to tools and knowledge that allow them to find the loopholes they need to pay minimum taxes.

Moreover, corporations and wealthy individuals "tax" the infrastructure, the natural resources, and environment more than the rest of us. They use heavy trucks on our highways and roads to transport their goods. CEOs travel in private jets that pollute our environment while hundreds of us travel crammed in crowded airplanes, buses, and trains. They use more energy in their huge mansions and air-conditioned offices in skyscrapers, while the 99% share fewer resources and use communal services.

In short, the 99% are not asking to take the 1%’s money, they just want a fair system that offers everyone equal access to resources, to public servants, and to the law. The 99% want true equal opportunity.

December 14, 2011

Libyan and European rulers’ treatment of Blacks and immigrant workers: Apathy in the face of Cruelty

    Wednesday, December 14, 2011   No comments
by Ahmed E. Souaiaia*


Since the start of the Libyan uprising, mainstream news outlets have reported that African and even Eastern European mercenaries were fighting with Qaddafi’s forces. The Libyan rebels, eager to minimize any support for Qaddafi among the Libyan population, have fed western media horror stories of mass murder carried out by Black Africans. Consequently, many immigrant workers were caught between the ire of a regime that did not care much for them and a new wave of prejudice and discrimination fueled by the media and rebel propaganda. The fact that some foreigners fought for the regime does not tell the full story. Most African immigrants were unwilling participants in a war that no one had anticipated.


In order to understand the presence of so many Africans and non-Africans in Libya, one must understand the role played by the former dictator.



October 17, 2011

CHARTS: Here's What The Wall Street Protesters Are So Angry About...

    Monday, October 17, 2011   No comments

by Henry Blodget

The "Occupy Wall Street" protests are gaining momentum, having spread from a small park in New York to marches to other cities across the country.

So far, the protests seem fueled by a collective sense that things in our economy are not fair or right. But the protesters have not done a good job of focusing their complaints—and thus have been skewered as malcontents who don't know what they stand for or want.


(An early list of "grievances" included some legitimate beefs, but was otherwise just a vague attack on "corporations." Given that these are the same corporations that employ more than 100 million Americans and make the products we all use every day, this broadside did not resonate with most Americans).

So, what are the protesters so upset about, really?

Do they have legitimate gripes?

To answer the latter question first, yes, they have very legitimate gripes.

And if America cannot figure out a way to address these gripes, the country will likely become increasingly "de-stabilized," as sociologists might say. And in that scenario, the current protests will likely be only the beginning.


The problem in a nutshell is this: Inequality in this country has hit a level that has been seen only once in the nation's history, and unemployment has reached a level that has been seen only once since the Great Depression. And, at the same time, corporate profits are at a record high.

In other words, in the never-ending tug-of-war between "labor" and "capital," there has rarely—if ever—been a time when "capital" was so clearly winning.

…read Article


October 9, 2011

A Tahrir Moment on Wall Street

    Sunday, October 09, 2011   No comments
Will people's encampments emerge in financial districts around the world?


On Saturday, September 17th, many of us watched in awe as 5,000 Americans descended on the financial district of Lower Manhattan, waved signs, unfurled banners, beat drums, chanted slogans and proceeded to walk toward the "financial Gomorrah" of the nation. They vowed to "occupy Wall Street" and to "bring justice to the bankers," but the New York police thwarted their efforts temporarily, locking down the symbolic street with barricades and checkpoints. Undeterred, protesters walked laps around the area before holding a people's assembly and setting up a semi-permanent protest encampment in a park on Liberty Street, a stone's throw from Wall Street and a block from the Federal Reserve Bank of New York.

Three hundred spent the night, several hundred reinforcements arrived the next day and as we write this article, the encampment is rolling out sleeping bags once again. When they tweeted to the world that they were hungry, a nearby pizzeria received $2,800 in orders for delivery in a single hour. Emboldened by an outpouring of international solidarity, these American indignados say they'll be there to greet the bankers when the stock market opens on Monday. It looks like, for now, the police don't think they can stop them. ABC News reports that "even though the demonstrators don’t have a permit for the protest, [the New York Police Department says that] they have no plans to remove those protesters who seem determined to stay on the streets." Organizers on the ground say, "We're digging in for a long-term occupation." Now the world is watching and wondering: Could this be the spark of a "Tahrir Moment" in the USA?

#OCCUPYWALLSTREET was inspired by the people's assemblies of Spain and floated as a concept by a double-page poster in the 97th issue of Adbusters magazine, but it was spearheaded, orchestrated and accomplished by independent activists. It all started when Adbusters asked its network of culture jammers to flood into Lower Manhattan, set up tents, kitchens and peaceful barricades, and occupy Wall Street for a few months. The idea caught on immediately on every social network, and unaffiliated activists seized the meme and built an open-source organizing site. A few days later, a general assembly was held in New York City and 150 people showed up. These activists became the core organizers of the occupation. The mystique of Anonymous pushed the meme into the mainstream media. Their video communique endorsing the action garnered 100,000 views and a warning from the Department of Homeland Security addressed to the nation's bankers. When, in August, the indignados of Spain sent word that they would be holding a solidarity event in Madrid's financial district, activists in Milan, Valencia, London, Lisbon, Athens, San Francisco, Madison, Amsterdam, Los Angeles, Israel and beyond vowed to do the same.

There is a shared feeling on the streets around the world that the global economy is a Ponzi scheme run by and for Big Finance. People everywhere are waking up to the realization that there is something fundamentally wrong with a system in which speculative financial transactions add up, each day, to $1.3 trillion (50 times more than the sum of all the commercial transactions). Meanwhile, according to a United Nations report, "in the 35 countries for which data exist, nearly 40 per cent of jobseekers have been without work for more than one year."

"CEOs, the biggest corporations and the wealthy are taking too much from our country and I think it's time for us to take back," says one activist who joined the protests last Saturday. Jason Ahmadi, who traveled in from Oakland, California, explained that "a lot of us feel there is a large crisis in our economy and a lot of it is caused by the folks who do business here." Bill Steyerd, a Vietnam veteran from Queens said, "It's a worthy cause because people on Wall Street are blood-sucking warmongers."

There is not just anger. There is also a sense that the standard solutions to the economic crisis proposed by our politicians and mainstream economists – stimulus, cuts, debt, low interest rates, encouraging consumption – are false options that will not work. Deeper changes are needed … like a "Robin Hood" tax on financial transactions; reinstating the Glass-Steagall Act in the USA; implementing a ban on high frequency "flash" trading. The "too big to fail" banks must be be broken up, downsized and made to serve the people, the economy and society again. The financial fraudsters responsible for the 2008 meltdown must be brought to justice and given lengthy prison terms. Then there is the long-term mother of all solutions: a total rethinking of Western consumerism that throws into question how we measure progress.

If the current economic woes in Europe and the US spiral into a prolonged global recession, then people's encampments will become permanent fixtures in financial districts and outside stock markets around the world. Until our demands are met and the global economic regime is fundamentally reformed, our tent cities will keep popping up everywhere.

Bravo to those courageous souls in the encampment on New York's Liberty Street. Every night that #OCCUPYWALLSTREET continues will escalate the possibility of a full-fledged global uprising against business as usual.

A different draft of this article was published by the Guardian online.

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