Green Left Weekly's fighting fund

June 29, 2007

Heard the story about the last capitalist on Earth who sold the rope used to hang the second last capitalist? Well, they will try and make a buck from anything.

Take CDOs, for instance. Collateralised debt obligations were one of the hottest products on Wall Street until last week when the world's leading financial management and advisory companies, Merrill Lynch, tried to sell some of them and failed and as a result started serious worry about a world recession.

CDOs are bundles of debt — good debts and bad debts bundled up in a package in the hope that some bank, hedge fund, superannuation trust or other institution with lots of money and nothing constructive to do with it, will buy it.

In these packages hide some of the hundreds of billions of dollars of home mortgages struggling families in the US can no longer afford to service. They call them "subprime mortgages". The British Telegraph reported on May 5: "Up to two million people with so-called subprime ... mortgages have already had their homes repossessed, or will default on their loans in the coming months, according to industry estimates."

The bank that does the packaging makes its money by collecting a hefty fee for doing all the hard con work. These little packages of debt are sold and resold with more fat fees collected by banks and brokers along the way until someone realises that they are trading bad debt. That's what happened when Merrill Lynch tried to flog one of these CDO packages, on behalf of a hedge fund, and got offered less that 30% of its face value.

Billions of shit hit the fan, so to speak. And now all the world financial markets have got the jitters. The Bank of International Settlements added to the bad nerves with the observation in a report that "the conditions which led up to the Great Depression of the 1930s and the Asian crises in the 1990s were reflected in the current environment".

While they've got their incredible greed-based crises, we've got more modest money challenges of our own — such as how to keep this anti-capitalist rag afloat.

Last week was a good week for us. Our supporters helped us raise a total of $10,717 bringing the total raised this year to $106,696 which is 43% of our target for this year.

There were two large individual donations — $2000 and $1500! Thanks to you-know-who-you-are. Paola, a young supporter in Wollongong is offering to shave her head as a fundraiser. (She is seeking sponsors, so ring Will on our toll-free line below if you can sponsor her.)

Otherwise, please post your donation to PO Box 515, Broadway NSW 2007, phone it through on the toll-free line 1800 634 206 (calls from within Australia only) or donate online at:

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