Former US President Bill Clinton information confirms John Key New Zealand Prime Minister played a large part in the Global Financial Crisis.
John Key claims he was long gone from the financial quackery sector when all the international financial deregulation of 1999 or lack of regulating new high risk derivative products occurred that went on to cause the global financial crisis. But the following irrefutable proof from his very mouth and that of the highest sources proves he in-fact played a big part in the global financial crisis that afflicted the globe.
Financial markets: Derivative dilemmas
By Aline van Duyn
Published: August 11 2010 London Financial Times
“In the wake of the recent financial crisis, over-the-counter derivatives have been blamed for increasing systemic risk,” said Federal Reserve Bank of New York staff in a paper earlier this year. “OTC derivatives serve a vital role in financial markets but deficiencies in the market design and infrastructure allowed for misuse of these instruments, exacerbating the recent financial meltdown.”
Bill Clinton admits choosing not to regulate derivatives 1999 caused the Global Financial Crisis.
Jake Tapper ABC interview April 2010
In an interview on This Week with Jake Tapper, President Bill Clinton said he made a mistake listening to Bob Rubin and Larry Summers on derivatives, and said he should have tried to regulate them, despite Republican opposition:
TAPPER: One of the things that President Obama is pushing for is regulation of derivatives, and also with a thing called the Volcker rule, he’s trying to separate commercial banking interests from investment banking interests. These were things that were the opposite policies of Treasury Security Rubin and Summers at that time, do you think in retrospect they gave you bad advice on these issues?
CLINTON: Well, I think on the derivatives – before the Glass-Steagall Act was repealed(1999), it had been breached. There was already a total merger practically of commercial and investment banking, and really the main thing that the Glass-Steagall Act did was to give us some power to regulate it – the repeal. And also to give old fashion traditional banks in all over America the right to take an investment interest if they wanted to forestall bankruptcy. Sadly none of them did that. Mostly it was just the continued blurring of the lines, but only about a third of all the money loaned today is loaned through traditional banking channels and that was well underway before that legislation was signed. So I don’t feel the same way about that.
I think what happened was the SEC and the whole regulatory apparatus after I left office was just let go. I think if Arthur Levitt had been on the job at the SEC, my last SEC commissioner, an enormous percentage of what we’ve been through in the last eight or nine years would not have happened. I feel very strongly about it. I think it’s important to have vigorous oversight.
Now, on derivatives, yeah I think they were wrong and I think I was wrong to take it because the argument on derivatives was that these things are expensive and sophisticated and only a handful of investors will buy them and they don’t need any extra protection, and any extra transparency. The money they’re putting up guarantees them transparency. And the flaw in that argument was that first of all sometimes people with a lot of money make stupid decisions and make it without transparency.
And secondly, the most important flaw was even if less than 1 percent of the total investment community is involved in derivative exchanges, so much money was involved that if they went bad, they could affect a 100 percent of the investments, and indeed a 100 percent of the citizens in countries, not investors, and I was wrong about that. I’ve said that all along. Now, I think if I had tried to regulate them because the Republicans were the majority in the Congress, they would have stopped it. But I wish I should have been caught trying. I mean, that was a mistake I made.
Article by Fran O’Sullivan titled – Key chases luck o’ the Irish – published New Zealand Herald July 20 2005;
Key is clearly on a roll as he lists the options New Zealand could explore if it decided to abandon outdated ideology and take a more pragmatic approach to growing the economy.
The former investment banker knows what he is talking about.
As head of global foreign exchange for investment giant Merrill Lynch he shifted a considerable amount of his business to Ireland in the mid-1990s to take advantage of a 10 per cent tax rate for foreign investors.
The investment was a runaway success.
“We transferred across the aircraft leasing business, the complex interest rates derivatives business, the entire back office for global foreign exchange and a huge chunk of private clients’ business,” says Key.
John Key’s National Party website bio proudly states his past employment record in banking;
“John launched his investment banking career in New Zealand in the mid 80s. After 10 years in the New Zealand market he headed offshore, working in Singapore, London and Sydney for US investment banking giant Merrill Lynch. During that time he was in charge of a number of business units including global foreign exchange and European bond and derivative trading. In 1999 John was invited to join the Foreign Exchange Committee of the Federal Reserve Bank of NY and on two occasions undertook management studies at Harvard University in Boston.”
• Investment banker, New Zealand for 10 years
• Investment banker, Merrill Lynch 1995-2001
• Member, Foreign Exchange Committee of the Federal Reserve Bank of
New York 1999-2001
John Key – The Unauthorised Biography
- Weekend Herald Sat July 19 2008
Merrill Lynch Senior Executive Steve Bollotti said of John Key “he revolutionised the blue blood investment banking sector.”
Key explains: “I had a whole lot of people working for me who were at the cutting edge of delivering quite complex and new and innovative products. They tended to either be a new product or into a new market, usually the emerging markets, Russia, Brazil, Argentina. I wasn’t the guy sitting there dreaming it all up, but I was the guy who was responsible for those people.” Did he foresee the problems which resulted in the sub-prime crisis? “Was it hard to predict? Not really.”
The products which underpinned the sub-prime boom – then bust – were hatched in 2004-2005, long after Key had left Merrill. Indeed, he says when he went back to London in 2007 he was “horrified” at the level of risk Merrill was running. “It was enormous and I just didn’t think that enough had changed to warrant that level of risk.”
Back in the late 1990s Key was in his element, working at the centre of the universe for FX. He presided over around 140 dealers trading billions of dollars a day. The Asian markets came in in the morning and New York in the afternoon. “Within two years we went from being 43 in euromoney to number three,” Key says.
Not only is John Key quite clearly lying about not being involved in complex derivatives at the exact time when a mix of deregulation and non-regulation of these toxic products went on to cause the global financial crisis but he is now setting about making New Zealand a money laundering 0% tax haven base for his banking sector buddies which various articles appearing in the foreign financial news media make clear his buddies are very much looking forward to it and are very impressed how he has thus far been able to do it on the sly;
Tax reforms set New Zealand on course for non-resident funds boost
Elizabeth Pfeuti 09 May 2011 efinancialnews.com
Last month, the kiwi government tabled a bill that would remove the current 28% tax rate on income incurred by non-residents investing in funds held in New Zealand.
The move by the government is the latest to entice investors to domicile assets on its shores. A year ago, prime minister John Key, a former Merrill Lynch banker, created a focus group to examine how the nation could become more welcoming to foreign assets and enlisted consultant Oliver Wyman to examine the country’s options.
The consultancy’s recommendation was to market New Zealand as a funds domicile in the Asia-Pacific region.
Abletshauser said the nation was sound economically and politically and had a highly educated workforce, all of which combined to create an ideal environment for a financial centre.
He said: “The news is that there is actually draft legislation now which is a final step towards implementation – before, the quango set up to analyse the situation may have recommended that such legislation not be implemented or the quango’s findings may have been ignored for politically expedient reasons. In fact, what is even better news is that this is receiving little publicity in New Zealand –which means there is a higher likelihood the PM will nudge it through without too much meddling from the country’s left wing camp.”
Key itching for quick action on financial hub
Fran O’Sullivan Dec 2 2010 New Zealand Herald
Prime Minister John Key has slammed bureaucratic pin-pricking over the proposed New Zealand financial services hub as “absolute rubbish” and stepped in to put the project on the fast-track.
Economic Development Minister Gerry Brownlee has been ordered to produce an urgent paper covering a zero tax rating for the relevant foreign funds which Key wants incorporated in the November taxation bill and passed by April 1 next year.
The Prime Minister’s frustration with Ministry of Economic Development officials spilled over publicly during a question session at an Auckland dinner on Tuesday night where he stressed New Zealand needed to be more optimistic and back success.
“There’s been a whole series of advice coming from MED which basically says ‘if you want to do this, you’ve got to deliver the Magna Carta of documents’,” Key told the International Business Forum audience.
“You’ve got to do all these things and need bipartisan support’ and [so] it goes – on and on and on.”
Key went on to say MED’s approach was “absolute rubbish”.
“I don’t need the Magna Carta of documents - just get on and do something – which is why I have told Gerry to deliver me a paper that has zero rating of funds and we’ll work on that.”
Key is confident New Zealand will be able to attract financial funds to place their back office administration here saying a chief executive of one of the world’s most powerful banks had told him: “If you are prepared to zero-rate foreign funds that are not invested in NZ, we’re going to move $2.5 billion of funds here in two years because you’re 50 per cent cheaper than Australia.”
Visiting Hong Kong Financial Secretary John Tsang welcomed the Prime Minister’s intention saying if New Zealand develops a financial services hub it will help to grow the worldwide industry.
Earlier reports to the Prime Minister suggested the administration of financial services could become a billion-dollar industry and create 3000 to 5000 new high-paying jobs.
The Government is not planning a “big bang” launch but expects the hub to grow organically.
So John Key wants us to emulate what he got up to in Ireland. Set up a money laundering 0% tax haven for his banking buddies and we will do well out of all of the taxes their accountants and lawyers are going to pay when they move their back office operations here. Problem is that everywhere these corporate sweetheart deals have been offered to the so-called Financial Service Sector they have become a parasite that consumes the host. Just take a look at what John Key left behind in Ireland from where much of his estimated sixty million dollar fortune was gained and decide if you are really dumb enough to trust this man to act in the longterm public interest above that of his banking buddies family trust funds?
Irish Central Magazine May 23 2010
Simon Johnson, former chief economist at the International Monetary Fund unto 2008 describes Ireland today;
“Ireland’s politicians, rather than facing up to their problems, are making things ever worse. Simply put, the Irish miracle was a mirage driven by clever use of tax-haven rules and a huge credit boom that permitted real estate prices and construction to grow quickly before declining ever more rapidly.”
Telegraph Newspaper article Feb 26 2011 (Paraphrased) says this of Ireland today;
” As Irish voters headed for the polling booths on Friday, the European Commission bluntly declared that the terms of the EU-IMF bailout “must be applied” whatever the will of Ireland’s people or regardless of any change of government..……..
“It is not even take it or leave it. It’s done. Ireland’s only role in this now is to implement the programme agreed with the EU, IMF and European Central Bank. Irish voters are not a party in this process, whatever they have been told,” said the diplomat.”
I rest my case
Good luck to you and your families.
19 Nov 2011