Finance, like a cancer grows

It is astonishing that every week we see action being taken in various parts of the world against the financial sector, without any noticeable reaction of public opinion.

It is astonishing because at the same time we are experiencing a very serious crisis, with high unemployment, precarious jobs and an unprecedented growth of inequality, which can all be attributed, largely, to speculative finance.

This all began in 2008 with the mortgage crisis and the bursting of the derivatives bubble in the United States, followed by the bursting of the sovereign bonds bubble in Europe. It is calculated that we will need to wait until at least 2020 to be able to go back to the levels of 2008 – so we are talking of a lost decade.

To bail out the banks, the world has collectively spent around US$4 trillion of taxpayers’ money. Just to make the point, Spain has dedicated more than its annual budget on education and health to bail out the banking sector ... and the saga continues.

Last week, five major banks agreed to pay $5.6 billion to the US authorities because of their manipulations in the currency market.

The banks are household names: the American JPMorgan Chase and Citigroup, the British Barclays and the Royal Bank of Scotland, and the Swiss UBS.

In the case of UBS, the US Department of Justice took the unusual step of tearing up a non-prosecution agreement it had reached earlier, saying that it had taken that step because of the bank's repeated offences.

“UBS has a “rap sheet” that cannot be ignored,” said Assistant US Attorney General Leslie Caldwell.

Third World Network Features