Tag: banks

Scrutiny of World Bank intensifies over $24 billion in unaccounted climate funds

The World Bank has pledged over $100 billion to combat climate change, but a new report by Oxfam found that up to $41 billion of this spending is “effectively unaccounted for” due to poor record-keeping by the World Bank.

A World Bank insider, speaking on condition of anonymity, suggested the figure for the missing money “could be twice or 10 times more.”

“All the figures are routinely made up,” the source said. “Nobody has a clue about who spends what.”

Oxfam’s report, titled ‘Climate Finance Unchecked’, was published on 17 October ahead of COP29 in Azerbaijan which is currently taking place, and during which climate finance is taking centre stage.

The report alleges that the World Bank’s current approach to tracking climate finance is flawed and makes it impossible to verify its expenditures and impact.  Specifically, the Bank’s accounting system, which tracks climate finance at the time of project approval rather than project completion, makes it difficult to verify how funds were spent.

Oxfam’s investigation revealed that obtaining even basic information on how the World Bank is using climate finance was painstaking and difficult.

“We had to sift through layers of complex and incomplete reports, and even then, the data was full of gaps and inconsistencies. The fact that this information is so hard to access and understand is alarming – it shouldn’t take a team of professional researchers to figure out how billions of dollars meant for climate action are being spent. This should be transparent and accessible to everyone, most importantly communities who are meant to benefit from climate finance,” Kate Donald, Head of Oxfam International’s Washington D.C. Office, said.

The World Bank’s centrality to climate finance makes its lack of transparency all the more troublesome, according to Oxfam, which argues that the bank’s claims of ambition are impossible to verify without more precise and transparent accounting methods. 

Oxfam estimates that the difference between budgeted and actual expenditures on climate finance amounts to tens of billions of dollars over six years. And the World Bank’s opacity in accounting methods has led to concerns about mismanagement, corruption and the potential diversion of funds away from their intended purpose.

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Every GOP Senate Majority Leader Candidate Opposes Marijuana Legalization

With Republicans winning control of the U.S. Senate in last week’s elections, a key question for marijuana reform advocates and stakeholders is what the selection of a new GOP majority leader will mean for cannabis reform.

There are three names currently at the top of the list of potential majority leaders who will set the legislative agenda: Sens. John Cornyn (R-TX), Rick Scott (R-FL) and John Thune (R-SD). None have embraced ending prohibition, and each has a track record of expressing concerns about cannabis use or even moderate policy reforms such as those endorsed by President-elect Donald Trump on the campaign trail.

With Senate Minority Leader Mitch McConnell (R-KY) having already announced he will not be seeking to return to the leadership position, this will the first time since 2007 that the GOP caucus will be selecting a new majority leader. Republican senators are set to meet on Wednesday to make that determination.

Trump hasn’t endorsed a specific candidate to assume the top Senate role, but while Thune is generally considered a front-runner, certain of the president-elect’s allies such as Elon Musk have been pushing for Scott to become the chamber’s leader.

However it shakes out, the current contenders are united in their opposition to legalizing marijuana.

There are some in the industry who remain hopeful that Trump’s embrace of an unsuccessful Florida legalization measure, cannabis banking reform and rescheduling could move the party to fall in line. But the extent to which the incoming president cares enough about the issue to forcefully push for, or even occasionally mention, it from the White House remains to be seen.

After announcing his support for the policy change, Trump became relatively quiet on the issue ahead of the election—which may partly explain why his supporters evidently did not adopt his position, according to a recent poll.

And based on the records of the top contenders for Senate majority leader, it seems highly unlikely they would proactively try to enact reform legislation without a major push from the president.

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World Bank Missing $41 Billion in Climate Funds

A new report by Oxfam, “Climate Finance Unchecked,” has determined that the World Bank has $41 billion in unaccounted funds that were destined to fight climate change.

This figure represents 40% of all disbursed climate funds by the World Bank. Oxfam’s audit revealed that between 2017 and 2023, between $24 billion and $41 billion simply went unaccounted for and there is absolutely no record of where the money went. No one knows how the money was used as there is no paper trail revealing where the money went.

“The Bank is quick to brag about its climate finance billions —but these numbers are based on what it plans to spend, not on what it actually spends once a project gets rolling,” said Kate Donald, Head of Oxfam International’s Washington D.C. Office. “This is like asking your doctor to assess your diet only by looking at your grocery list, without ever checking what actually ends up in your fridge.”

The World Bank is a leader in climate finance, controlling 52% of the total flow from all multilateral banks combined. World Bank President Ajay Banga announced in December that the bank achieved 35% of its financing three years ahead of schedule. He then set a new target of 45% by 2025. The bank later said in September that it achieved 44% of climate financing to the tune of $42.6 billion. “We’re putting our ambition in overdrive,” Banga said.

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Central Bank Digital Currency (CBDC) Projects Are Foundering in Five-Eye Nations. What Gives?

Canada and Australia shelve plans for retail CBDCs while the US could soon become the first country to explicitly ban the central bank from issuing a CBDC.   

As we warned in May 2022, a financial revolution is quietly sweeping the world (or at least trying to) that has the potential to reconfigure the very nature of money, making it programmable, far more surveillable and centrally controlled. To quote Washington DC-based blogger and analyst NS Lyons, “if not deliberately and carefully constrained in advance by law,… CBDCs have the potential to become even more than a technocratic central planner’s dream. They could represent the single greatest expansion of totalitarian power in history.”

At the time of writing that post, around 90 countries and currency unions were in the process of exploring a CBDC, according to the Atlantic Council’s CBDC tracker. Today, just two and a half years later, that number has increased to 134, representing 98% of global GDP. Around 66 of those countries are in the advanced stage of exploration—development, pilot, or launch.

But they do not include the United States. In fact, the US is not just trailing most countries on CBDC development; it could soon become the first country to explicitly ban the central bank from issuing a CBDC, to the undisguised horror of certain think tanks.

“CBDC Anti-Surveillance State Act.”

In May, the US House of Representatives passed HR 5403, also known as the “CBDC Anti-Surveillance State Act.” The bill, first introduced in September 2023 and sponsored by US Senator Ted Cruz, proposes amendments to the Federal Reserve Act to prohibit the US Federal Reserve from issuing CBDCs. It also seeks to protect the right to financial privacy and prevent the U.S. government from “weaponizing their financial system against their own citizens.”

If passed, HR 5403 will prevent the Fed from:

  1. Offering products or services directly to individuals.
  2. Maintaining accounts on behalf of individuals.
  3. Issuing a central bank digital currency or any digital asset that is substantially similar under any other name or label directly to an individual.

To become law, the bill still needs to clear the Senate, which is by not means guaranteed. But it is likely to receive added impetus from a new Trump administration, assuming Trump wins the election and isn’t assassinated before taking office or thwarted by a colour revolution, as Lambert posited yesterday. In January, Trump announced, to thunderous applause, at a New Hampshire that as president, he would “never allow the creation of a central bank digital currency.” Such a currency, he said, “would give a federal government, our federal government, absolute control over your money.”

Even a Kamala Harris administration is unlikely to fast-track a digital dollar, with progress set to continue to lag other jurisdictions, according to an article in The Banker. US voters — particularly Republican ones — are increasingly aware — and wary — of the threat posed by CBDCs, as demonstrated by the crowd’s reaction to Trump’s announcement. This, if nothing else, stands as testament to the power of social and independent media, and goes a long way to explaining why governments across the West are trying desperately to muzzle them.

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Governments must tax or ban Bitcoin to maintain deficits: Minneapolis Fed

A recent research paper by the Federal Reserve Bank of Minneapolis suggests that assets such as Bitcoin should be taxed or banned to help governments maintain deficits. 

In an economy where the government tries to maintain permanent deficits using nominal debt, the presence of Bitcoin BTC$66,910 creates problems for policy implementation, the Minneapolis Fed said in a working paper released on Oct. 17.

Bitcoin introduces a “balanced budget trap,” an alternative state where the government is forced to balance its budget, the Fed wrote. 

The researchers used Bitcoin as an example of a fixed-supply “private-sector security” without “real resource claims.” They concluded that it should be banned or taxed to solve the conundrum. 

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No Compromise With the Fed!

Some people argue like this: Although the Fed as it now exists is very bad, a nation needs a central bank to regulate its money supply, and the Fed is better than nothing. That being so, we should try to urge the Fed to adopt a non-expansionary monetary policy. In this view, calls to “End the Fed” are mistaken. I’m sure most of my readers already know what I’m about to say, but, just to be clear, that view is disastrously wrong. We do not need a central bank, and to argue in the way indicated is to betray the great Murray Rothbard and the great Dr. Ron Paul, whose slogan “End the Fed” has galvanized so many of us.

What we need is the classical gold standard, based on 100% reserve banking. There is no need for an expansion of the monetary system, even a gradual expansion. In fact, monetary expansion is inflationary and dangerous. As the leading Rothbardian authority on money, Professor Joseph Salerno, explains: “Under the classical gold standard, [which prevailed in the nineteenth century before World War I] if people in one nation demanded more money to carry out more transactions or because they were more uncertain of the future, they would export more goods and financial assets to the rest of the world, while importing less. As a result, additional gold would flow in through a surplus in the balance of payments increasing the nation’s money supply.

Sometimes, private banks tried to inflate the money supply by issuing additional bank notes and deposits, called ‘fiduciary media,’ promising to pay gold but unbacked by gold reserves. They lent these notes and deposits to either businesses or the government. However, as soon as the borrowers spent these additional fractional-reserve notes and deposits, domestic incomes and prices would begin to rise.

As a result, foreigners would reduce their purchases of the nation’s exports, and domestic residents would increase their spending on the relatively cheap foreign imports. Gold would flow out of the coffers of the nation’s banks to finance the resulting trade deficit, as the excess paper notes and checks were returned to their issuers for redemption in gold.

To check this outflow of gold reserves, which made their depositors very nervous, the banks would contract the supply of fiduciary media bringing about a monetary deflation and an ensuing depression.

Temporarily chastened by the experience, banks would refrain from again expanding credit for a while. If the Treasury tried to issue convertible notes only partially backed by gold, as it occasionally did, it too would face these consequences and be forced to restrain its note issue within narrow bounds.

Thus, governments and commercial banks under the gold standard did not have much influence over the money supply in the long run. The only sizable inflations that occurred during the 19th century did so during wartime when almost all belligerent nations would ‘go off the gold standard.’ They did so in order to conceal the staggering costs of war from their citizens by printing money rather than raising taxes to pay for it.”

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Israel Starts Bombing Banks in Lebanon

Late Sunday, the Israeli military began launching a series of airstrikes in Beirut’s southern suburbs of Dahieh and in eastern Lebanon’s Bekaa Valley, targeting the branches of a bank.

The strikes began shortly after an Israeli military spokesman said the Israeli Defense Forces (IDF) would start hitting buildings that belong to al-Qard al-Hassan Association, a bank that Israel accused of financing Hezbollah.

“The air force will launch extensive strikes on targets in the southern suburb of Beirut, targeting Hezbollah-linked economic assets,” IDF spokesman Daniel Hagari said not long before the strikes were launched.

Al-Qard al-Hassan is under US sanctions over allegations related to Hezbollah, but the bank is also used by ordinary Lebanese citizens. According to Reuters, the bank has 30 branches across Lebanon, including 15 in densely populated parts of Beirut and its suburbs.

Lebanon’s National News Agency reported at least 11 Israeli airstrikes hit Beirut’s southern suburbs, including one that landed near Beirut International Airport, and many targeted al-Qard al-Hassan buildings. Several strikes were also reported in the Bekaa Valley.

The bank issued a statement assuring its customers that it had taken “all of the necessary procedures since the beginning of the war to safeguard your deposits and valuables and can confirm that you should not worry they are safe.”

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No Central Bank Wants To Stop Price Inflation

Many citizens want more government control of the economy to curb rising prices. It is the worst strategy imaginable. Interventionist governments never reduce consumer prices because they benefit from inflation, dissolving their political spending commitments in a constantly depreciated currency. Inflation is the perfect hidden tax. The government makes the currency less valuable by issuing more units of fiat money, partially dissolves its debt in real terms, collects more taxes, and presents itself as the solution to rising prices with subsidies in an increasingly worthless currency.

That is why socialism and hyperinflation go hand in hand.

Socialism rejects human action and economic calculation and sells a false image of a government that can create wealth at will by issuing more units of fiat currency. Obviously, when inflation arrives, the socialist government will use its two favorite tools: propaganda and repression. Propaganda, which accuses stores and businesses of driving up prices, and repression, which occurs when social unrest intensifies and citizens legitimately hold governments accountable for scarcity and high prices, are the two main strategies.

If you want lower prices, you need to give less economic power to the government, not more. Only free markets, competition, and open economies help decrease consumer prices. Many readers might think that we currently have a free market with competitive and open economies, but the reality is that we live in increasingly intervened and overregulated nations where central banks and governments work to perpetuate unsustainable public deficits and debt. Therefore, they continue to print more money, leading many to question why it is getting harder for families to make ends meet, buy a home, or for small businesses to prosper. The government is slowly eating away the currency it issues. They call it “social use of money.”

What is “social use of money”? In essence, it means abandoning one of the main characteristics of money, the reserve of value, to give the government preferential access to credit to finance its commitments. Therefore, the state can announce larger entitlement programs and increase the size of the public sector relative to the economy, creating a self-fulfilling prophecy. The state issues more currency, which makes people’s money less valuable. Citizens become more dependent on the state, and they will demand more subsidies paid in the currency the state issues. It is, in essence, a process of control through debt and currency depreciation.

When governments and central banks talk about price stability, it means a two percent annual depreciation of the currency. Aggregate prices rising an average of two percent is hardly price stability because it is measured by the consumer price index, which is a carefully crafted basket of goods and services weighted by the same people who print the money. That is why governments love CPI as a measure of inflation. It fails to fully reflect the erosion of the currency’s purchasing power. This is why the CPI’s basket calculation fluctuates so frequently. Even if it accurately measures, it will underestimate the rise in prices of non-replaceable goods and services by adding them to a basket of things we consume maybe once or twice a year at best. When you put together shelter, food, health, and energy with technology and entertainment, there will always be distortions.

Thus, governments and central banks are never going to defend price stability. If aggregate prices fell, competition soared, and citizens saw their real wages rise and their deposit savings increase in real value, their jobs would disappear.

When a central bank like the Fed cuts rates and increases the money supply after an accumulated 20.4% inflation in four years, it is not defending price stability; it is defending price increases. This strategy serves to conceal the government’s financial insolvency. A currency with a declining value.

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Barron Trump Shut Out by Bank Amid Cancel Culture Accusations

Barron Trump, the youngest son of President Donald Trump, recently faced rejection while attempting to open a new bank account, according to claims from his mother, Melania Trump. She attributed the denial to political discrimination, labeling it as part of a larger “cancel culture” that she believes has targeted her family, raising significant concerns about potential civil rights violations.

Melania Trump, who shared this account in her newly released memoir titled “Melania,” expressed her deep frustration with the situation, revealing that she herself had been debanked.

The former first lady disclosed that shortly after the Trumps departed the White House in early 2021, her son, now 18, was blocked from opening an account at the financial institution she had long preferred.

Trump didn’t name the bank.

“I was shocked and dismayed to learn that my long-time bank decided to terminate my account and deny my son the opportunity to open a new one,” Melania wrote. She described the incident as an example of politically motivated bias, going so far as to question whether it constituted a breach of civil rights. Despite the gravity of the accusations, she chose not to reveal the name of the financial institution involved.

This denial, she argues, is just one example of the broader culture of exclusion and suppression her family has endured, a backlash that intensified in the wake of the January 6th Capitol events. According to Melania, this “venomous” form of cancel culture has extended beyond the political sphere, negatively affecting both her charitable efforts and business opportunities.

“The ‘cancel mob’ now includes corporations, traditional media, influential social media figures, and cultural institutions,” she wrote in her memoir, warning of the dangerous precedent this sets in modern society. She goes on to highlight how businesses—both large and small—continue to participate in this “disheartening trend,” one that she finds increasingly pervasive.

Debanking, the practice of denying individuals or organizations access to financial services based on their political, ideological, or social positions, has emerged as a controversial trend within the broader phenomenon of cancel culture. It represents a significant escalation in the methods used to isolate or punish those whose views or actions fall outside mainstream acceptability, raising critical concerns about freedom of expression, civil rights, and the role of private corporations in regulating societal behavior.

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