Bank may slash 30,000 jobs - Welcome to Internet Poverty

The Coming Economic Clusterfuck

• The Internet is causing the banking industry to fire tens of thousands of people.
• A permanent Great Depression is coming as the Internet, robotics and "free trade" outsourcing abolishes tens of millions of jobs forever.
• Welcome to a future of eternal poverty, EBT cards and government housing.

(Breaking News)  -  Barclays boss John McFarlane has signalled more job cuts to come at the bank as he set out plans to ramp up earnings growth and squeeze costs after half-year profits jumped by 25% but returns for shareholders remained low.

The executive chairman would not confirm reports that 30,000 jobs at the bank are to go but admitted that its new strategy of slimming down its international presence and streamlining executive decision-making would take its toll on numbers.

Barclays is already undergoing a major cost-cutting programme which saw 14,000 posts slashed last year and is expected to see 5,000 more axed by 2016.

Since Mr Jenkins’s departure there has been speculation that the group plans to shrink its workforce further, taking it from 132,000 to below 100,000 by the end of 2017.

Though he did not spell out where the axe would fall, he singled out “hierarchical, bureaucratic and group-centric” decision-making and hinted that parts of business outside core markets in the UK, US and South Africa looked set to be slimmed down.

Branch numbers fell to 1,448 at the end of June compared to 1,546 a year before at a time when the industry is scaling back costs by using automated services for customers while online and telephone banking is growing.

Many customers were “voting with their feet – in terms of using their fingers” by increasingly banking over the internet.

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Robots and computers replacing human wage earners

Is Puerto Rico Ground Zero?

• Meaningful jobs are not being created on the mainland U.S. and they are certainly not being created in Puerto Rico.  
• With fewer and fewer taxpayers the government of Puerto Rico jacks up taxes and goes deep into debt to try and keep schools, police, etc functioning.

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(Associated Press)  -  Nearly 10 years into a deep economic slump, Puerto Rico is no closer to pulling out, and, in fact, is poised to plummet further. The unemployment rate is above 12 percent. Some 144,000 people left the U.S. territory between 2010 and 2013, and about a third of all people born in Puerto Rico now live in the U.S. mainland. Schools and businesses have closed amid the exodus. The population of 3.5 million is expected to drop to 3 million by 2050.

The government has tried to boost revenue by hiking the sales tax to 11.5 percent, higher than any U.S. state, and closing government offices. Its debt-burdened power utility already charges rates that on average are twice those of the mainland, and is under pressure from bondholders to raise them higher.

A $58 million bond payment due Saturday went unpaid. If defaults continue, analysts say Puerto Rico will face numerous lawsuits and increasingly limited access to markets, putting a recovery even more out of reach.

A list of cost-cutting measures proposed by a group of hedge funds that holds $5.2 billion of Puerto Rico's debt has riled islanders: laying off teachers; cutting Medicaid benefits; and reducing subsidies to the main public university.

Meanwhile, a report commissioned by the government called for wage levels to be set below the federal minimum, paid holidays cut, and energy costs reduced.

Some economists warn that measures like new taxes could further depress the economy, a concern shared by small business owners.

"They're going to keep going until the people can't take it anymore," said Ignacio Veloz, who owns a condominium administration business.

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The Collapse is Coming
Business are "saving" money using the Internet, robotics and outsourcing to replace American workers.  But at some point there will not be enough wage earners to buy the products and services of Wall Street businesses.  At that point the economy goes into a Death Spiral of permanent unemployment, EBT cards and government housing.