6th July 2011
Aviva has brought together a collection of prominent thinkers to provoke renewed debate and fresh ideas about future prosperity and creating a culture of sustainable savings. Today this group of thinkers, the ‘Future Prosperity Panel‘, published their report ‘Big picture thinking – Towards sustainable savings’.
Ann Pettifor’s article is called ‘Savings and the alchemy of credit’ and is published alongside valuable work from Alain De Botton, Simon Tay, Paweł Świeboda and Diane Coyle.
Read a summary of Ann’s essay and watch her video interview to learn more … >
4th July 2011
Ann Pettifor was invited, by Sir David King, to join a panel at this year’s World Forum on Enterprise & the Environment organised by the Smith School of Enterprise and the Environment in Oxford. The session was led by Herman Mulder and was entitled ”Green the economy, Financial needs and tools: The economics of a world mobilising to address biodiversity issues on a massive scale.”
Read more about the discussion at the WFEE at the Guardian, and watch videos of the many activating speakers over the two days of the forum on the WFEE website.
By Ann Pettifor – 19th June 2011
The BBC Radio 4′s ‘World Tonight’ yesterday devoted the whole of their news programme to the question of global food security, and invited Ann Pettifor to comment throughout. She focussed on Goldman Sachs’s Global Commodity Index – (about which you can read more here in Foreign Policy) not very different from the ‘Collateralised Debt Obligations’ (CDOs) that had been used during the property bubble to ‘slice and dice’ assets, and make them available for speculative purposes.
The programming was in response to a recent statement by President Sarkozy to the World Farmers Union. He was speaking in his role as convenor of the upcoming G20 Summit in Cannes on 3-4 November, 2011, and called for greater regulation of financial markets:
“We must regulate financial markets in agricultural commodity derivatives. I know the causes of agricultural volatility are debated, and various parameters, such as speculation and weather conditions, have an influence. All this can be debated. But I would like to make a proposal: let’s not wait for the experts to agree before we act! Because one thing is for certain: the experts won’t agree. If you wait, nothing will be done, and we cannot afford to do nothing.
The G20 has made commitments to improve the operation of derivative markets, particularly oil derivative markets. I would like to see those commitments extended to agricultural derivative markets. Is there any reason, any argument for us not to apply what we did for oil derivative markets to agricultural commodity derivative markets?”
Ms Pettifor appeared with Waseem Khan of Silk Invest, a financial advisor to Middle Eastern Sovereign Wealth Funds. For more, you can listen on Iplayer here: http://www.bbc.co.uk/programmes/b011w837.
4th April 2011
In March, Ann Pettifor was honoured to be invited Ms Zarinah Anwar CEO of the Securities and Exchange Commission of Malaysia, and Dr Farhan Nizami of the Oxford Centre for Islamic Studies to attend a conference at Ditchley Park on “Shariah, Finance and the Public Good”.
But before the hard work of deliberation, delegates attended a splendid dinner at the Banqueting House, Whitehall, where they were welcomed by His Royal Highness, Dr Raja Nazrin Shah, Crown Prince of Perak, Malaysia.
In an opening address HRH asked the group to consider whether transfers of ‘artificial wealth’ served the public good; and whether Islamic finance could be distinguished from conventional finance? Prince Nazrin Shah suggested that trust in financial services has all but evaporated, and that such trust would not be restored until finance could demonstrate its concern with the public good.
Continue reading… ›
6th February 2011
Ann Pettifor was honoured to be named as one of Gordon Roddick’s ‘ethical pioneers changing the way we live’ in the Observer, Sunday 6th February 2011.
Gordon Roddick is no stranger to inspiring social and environmental change. He pioneered Fairtrade and co-founded The Body Shop and The Big Issue. Read his take on why we “can’t carry on operating under the same old system” as he outlines his hopes for a more sustainable – and fairer – way of life
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 Ann Pettifor: 5th July 2010
On my wall hangs the original of a cartoon of 12 June, 1999 by the FT’s Ingram Pinn. It is of an African bent over double by a burden of debt, while G8 leaders sit at a table perched precariously on top of the burden – ignoring the suffering African. The impoverished man is surrounded by campaigners, hollering at the G8 and with banners proclaiming: “Cancel the Debts” “Jubilee 2000”.
Behind that cartoon lies a story.
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By Ann Pettifor: April 25th Huffington Post
The humiliating surrender of Greece’s economic autonomy came just last Friday, 23 April, 2010. The democratically elected Prime Minister, George Papandreou transferred to unelected officials in Brussels and Washington the power to determine Greece’s fiscal policy. In other words, decisions about taxation, and how tax revenues should be spent.
In a 26 April interview with the Financial Times on the island of Rhodes, the Prime Minister, George Papandreou admitted his country had accepted “a partial surrender of sovereignty”. Our struggle” he went on to say, “will be to recover our autonomy and liberate Greece from the surveillance imposed by the forces of conservatism”. Back in 1765 Bostonians such as James Otis and Samuel Adams regarded “taxation without representation as a form of tyranny”. Today, a nation that served as the cradle of western democracy will effectively be governed by remote, invisible and unaccountable officials.
With Saturday’s Iceland referendum due in just a couple of days (6th March), Ann and Jeremy have an op-ed article in today’s Morgunbladid, Iceland’s main daily newspaper. English version> Icelandic version> Press release>
Full text of the article follows:
So the negotiations have broken down, British and Dutch “bullying” (FT 27 February, 2010) continues and the referendum goes ahead. What next?
We emphasize that this is not a sovereign debt crisis, even if the British and Dutch want us to think it is.
It is a crisis of EU regulatory failure, and of the Anglo-American economic model.
The people of Iceland have a deep democratic tradition, and through the referendum have the opportunity to assert their sovereignty and autonomy.
Their leadership and example will encourage people in other democracies to reject harsh cuts in public services and living standards made at the behest of the very people and institutions responsible for the crisis. For through the wholesale nationalisation of private losses, we are all – not only in Iceland – asked to pay the price of private, reckless risk-taking.
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My conversation with Elena Sisti – of Italy’s Altreconomia on macro-economics, reform of the finance sector, money, and yes, how we women have left the all-important matter of finance to the boys. Big mistake. It’s time to get in there, and exercise influence. Too much is at stake.
Women will have to work to feminise macrofinance – by taking economics courses; by challenging economic orthodoxy; by taking positions in banking and finance. Above all, by understanding the nature of credit and bank money.
Continue reading… ›
From the Guardian.co.uk
I was astonished to read Lord Myners’s assertion that banks use our deposits to lend out to businesses and homebuyers. (Comment, 25 January). This is simply not the case, and has not been the case since 1694 when the British banking system was established, and intangible bank money began the process of creating deposits in the banking system.
We have just lived through a period of asset price inflation fuelled by credit-creation that bore little relation whatsoever either to a) our deposits in banks, or b) to the underlying value of assets.
Far from the bank starting with a deposit or reserves as a basis for lending, the bank starts with an application for a loan, the asset (eg property) against which to guarantee or secure repayment, and the promise to repay with interest. A bank clerk then enters the number into a ledger/computer, and charges it to the account of the borrower. This is credit and has been known since 1694 as bank money – intangible and essentially free.
The bank does not need savings, deposits or reserves to create credit. If this were the case there would only be as much credit as there are deposits in the bank. These limits would have constrained an asset price bubble, as assets would not have been artificially inflated by underregulated credit creation. Once the loan is agreed, the bank then applies to the Bank of England for the cash element, which is a very small proportion in these days of debit/credit cards.
The fact that small businesses cannot obtain loans from banks, except at high rates of interest, has nothing to do with our deposits, but with the failure of bankers to fulfil their role and meet the needs of society and the economy. Which is why Lord Turner was right to dismiss them as “useless”. That failure may not have occurred if the Treasury had a better understanding of monetary theory and practice.
Ann Pettifor
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