In the Shadows of the Unknown


Fear is a political instrument, but knowledge is power




Your doorbell rings in the dark of night, so you quietly approach the peephole to size up your visitor. The porch light doesn’t illuminate the person well enough to see him clearly, but he’s definitely wearing a mask. You move your eyes lower to get a better look at the tall figure. He’s standing, waiting, on the other side of the threshold. He’s holding a machete.

On any other night, this scenario might send adrenaline coursing through your veins, fueling an almost palpable fear. But tonight is different. It’s Halloween. And rather than feeling scared, you casually open the door to discover that the dimly lit figure is the teenager from down the street dressed as the killer from a slasher flick.

We don’t fear a scary-looking stranger on our doorstep on October 31 because we know it’s very likely to be a friendly neighbor seeking sugar. This information, born of experience, empowers us to act rationally. It’s possible, of course, that the machete-wielding figure really is a murderer going door to door — but the odds are against it, especially on this night of the year.

Imagine if you didn’t know how to assess that risk. Imagine locking your doors, turning off all the lights, and cowering in the dark, waiting for all the trick-or-treaters to go away.

Unfortunately, this is the situation we too often find ourselves in when politicians and the media tell us to be scared — of terrorists, of deadly contagions from overseas, or just of each other. We know that not all of the threats can be real, but how are we to discern the true menaces from the false alarms?

When people are scared, they will support policies that promise to keep us safe, but end up costing us ever more—both in tax dollars and lost liberties. That’s why despots throughout history have sought means by which the masses could be intentionally kept in the dark: ignorance and fear give the despots power. It doesn’t matter which political party is in power. The left tries to scare people with dark visions of unchecked greed and exploitation. The right wants people to fear alleged threats to our security, both abroad and within our borders. Fear pervades politics generally. As John Adams once wrote, it is “the foundation of most governments.”

We naturally defer decision making to those who have access to greater political and military intelligence than the general population does. Christopher Guzelian, a legal theorist, posits that politicians are so successful in their use of fear because of “risk information (whether correct or false) that is communicated to society.” In other words, we fear the hobgoblins we can’t see solely on the basis that we’re told they exist and are coming after us. Guzelian concludes that it is “risk communication, not personal experience, [that] causes most fear these days.” Without information, and lacking direct experience, we often respond irrationally.

What can we do when we are not ourselves scientists, soldiers, or spies? How do we protect our freedom from a political class that benefits from our fears?

We’re all familiar with the fable about the boy who cried wolf. A shepherd boy repeatedly tricked nearby villagers into thinking that a wolf was attacking his flock of sheep. After multiple “false alarms,” the wolf actually did attack. But this time, when the boy called for help like he had many times before, the villagers did not respond. What changed? This time, they had information. While they didn’t know if there was a wolf or not, they did have observational data informing them about the trustworthiness of their source.

Our lives are filled with supposed shepherds warning us about the terror du jour. This warning may be completely concocted for political gain, or simply amplified or misinterpreted as a prediction of how a potential malefactor might act. Perhaps unsurprisingly, in an analysis of predictions made by 300 subject matter experts — and summarized in his book Expert Political Judgment: How Good Is It? How Can We Know? — Philip Tetlock observes that “there is a tendency for experts to claim to know more than they do about the future.” Put differently, we rely on people who often do not know what they’re talking about.

While we may not have access to the information necessary to know whether a purported political, economic, or other threat is as bad as is claimed, we are not helpless. Some sources are more reliable than others. We can cautiously develop a sense of which sources to listen to based on their track records.

The US government’s record is especially bad on foreign threats. “A few recent examples,” writes historian Tom Woods, “include the alleged Gulf of Tonkin incident (Vietnam), babies being tossed out of incubators (Iraq I), ‘genocide’ (Kosovo, where ‘hundreds of thousands’ of dead turned out to be 2000 dead on both sides of a civil war combined), weapons of mass destruction (Iraq II), and many others.”

Like the villagers in the fable, we cannot trust our shepherd — but what alternative do we have? Having grown weary of being duped by false reports, the villagers might have constructed a tower and employed an observer to stand watch and provide an accurate assessment of the surrounding area. The problem for the villagers, and for us, is that new infrastructure can be expensive. And, in the end, the new guardian may develop the same incentives as the old one.

Fortunately, modern technology offers us a superior strategy to combat those who wish to deprive us of the truth.

Prior to Johannes Gutenberg’s invention of the printing press in 1436, it was economically unfeasible for most individuals to own books, leading to widespread illiteracy. Without the ability to read information, let alone scrutinize and judge it, commoners had no intellectual defense with which they could combat falsehoods. The printing revolution empowered people to access and act upon truth, thus holding religious and political officials accountable for their misdeeds.

The Internet has similarly revolutionized information access and analysis. Leaks of confidential government documents have turned into a flood; firsthand reports from theaters of war circumvent government censors and combat propaganda; the proliferation of mobile devices has turned every citizen into an agent of accountability who can document the actions of police officers and turn their abuses of authority into viral videos. These and a host of other innovations empower the individual to obtain and act upon the truth. They also minimize the risk of our believing that something is a threat to our health, safety, or welfare when it really isn’t.

The most important and innovative byproduct of this technological advance is the decentralization of information, including inputs and outputs. There are now an abundance of sources and a variety of means by which we can listen to them. We’re not reliant upon a single shepherd. The world features observation towers in abundance—a marketplace of investigators, researchers, analysts, and commentators. Should one source prove untrustworthy, we have other options from which to choose.

Likewise, our ability to share the truth using technology ensures that controls and censorship will forever be circumvented; with the click of a button, we can now help countless others see that the emperor isn’t wearing clothes. Social media has radically altered the traditional news networks, and citizen journalists are increasingly empowered to identify, investigate, and report on an issue of concern. Worldwide dissemination of information is no longer a fanciful, futuristic dream—the revolution has become our reality.

We live in a dangerous world, where threats do exist and should be dealt with. We should be diligent, however, in figuring out what is or isn’t a credible threat. Imagine if your young neighbor was shot and killed by another homeowner unfamiliar with Halloween. Wouldn’t we agree that more information would have caused that neighbor to respond differently?

We can’t expect people to act reasonably in the face of some purported threat unless they can access the truth and the context that surround it. Thankfully, today we have more tools than ever to check those who cry wolf and expect people to stay cowering in the shadows of the unknown.


Monetary Lunacy At Work: IMF Puts 0.05% “Floor” Under SDRs


By Pater Tenebrarum at Acting Man blog

No negative rates for the putative Bancor … Keynes must surely be rotating in his grave. It turns out the IMF is not going to lend SDRs for less than nothing, thus breaking ranks with some well-known central banks out there (no need to name names), and even the central bank-manipulated “market” in which investors accept negative rates on certain government bonds as if that made any sense.

Instead, the IMF has decided to set a floor for its SDR interest rate to maintain its role as a profit center…it will be at what is nowadays a downright usurious height of 0.05%. So at least at the IMF, there will be no pretense that time preferences can actually turn negative.


There will be no funny money for nothing from me, busters! (Photo credit: REUTERS / Fahad Shadeed)


However, the IMF is thereby effectively raising its interest rate, which until recently was at a mere 0.03%:


“The International Monetary Fund is setting a 0.05 percent floor on the interest rate used to determine borrowing costs for some of its loans.

The executive board modified rules today to make the change, according to a statement today in Washington.

The IMF’s Special Drawing Right, based on a basket of the dollar, yen, euro and pound, is the fund’s unit of account that serves as a supplemental reserve asset and was designed to improve global liquidity.

The SDR interest rate was quoted on the IMF website at 0.03 percent today compared with 0.13 percent in April and more than 3 percent in August 2008, before central banks slashed borrowing costs to zero to boost growth in the aftermath of the financial crisis.

The rate will be 0.05 percent on Oct. 27, the IMF said.

The board also approved changing the rounding convention for calculating the SDR rate to three decimal points from two, the statement said.

The SDR interest rate is used to calculate interest charged to member nations for non-concessional loans and SDR allocations, and the rate paid to members for SDR holdings. It is calculated from a weighted average of the short-term money market rates of the SDR basket currencies.

A floor will prevent the SDR rate from going negative, in the event that money market interest rates on some of the currencies in the underlying basket themselves go negative, an IMF official told reporters on condition of anonymity. The fund has no legal basis for charging a negative rate on SDRs.


(emphasis added)

So this is a precautionary measure in case the phenomenon of negative market interest rates on short term government debt instruments starts spreading further. Needless to say, we take the fact that the IMF feels it has to prepare for this eventuality as yet another sign that the whole world has essentially gone insane.


Germany, 2 yr. yieldClear signs of the spread of central bank-induced insanity – German government debt yields are negative out to two years – via BigCharts. click to enlarge.


#MH370 / #MH17 – New lessons in responsibility for the ‘government’. Play time is over


2 Malaysian boys sue Malaysia Airlines, government over loss of father in missing Flight 370

Legal suits are steadily pouring in against the Malaysian government and its time for them to learn to be responsible for the citizens. Whoever said its easy to be governors? Malaysians are waking up to claim their rights and entitlements. In the words of Mr Putin Play time is over

Two Malaysian teenage boys are suing Malaysia Airlines and the government over the loss of their father eight months after Flight 370 that was carrying him mysteriously disappeared.

Friday’s suit was the first filed by the family member of a passenger aboard the missing jet.

Jee Kinson, 13, and Jee Kinland, 11, sought damages for mental distress and the loss of support following the disappearance of their father, Jee Jing Hang.

They said the airline and the government had been negligent and failed to take all due measures to ensure a safe flight.

The plane disappeared March 8 while flying from Kuala Lumpur to Beijing with 239 people on board. It was believed to have gone down in a remote patch of the Indian Ocean, where a search is ongoing. (AP)



Complexity: The Hidden Cost of Central Bank Actions

CFA Institute


dollarCentral banks are printing rules almost as fast as they’re printing money. The consequences of these fast-multiplying directives — complicated, long-winded, and sometimes self-contradictory — is one topic at hand. Manipulated interest rates is a second. Distortion and mispricing of stocks, bonds, and currencies is a third. Skipping to the conclusion of this essay, Grant’s is worried.

“One would not think at first sight that government had much to do with the trade of banking,” Walter Bagehot, the famed Victorian writer on finance, mused a century and a half ago. As time rolls on and regulation gives way to regimentation, the question presents itself: Do bankers have much to do with the trade of banking anymore?

One sees a certain measure of justice in the humbling of the regulated financial titans who put themselves in this position of vulnerability; many of them were going broke. Then, again, there’s irony in the regulatees ceding power to the regulators. The latter seemed to know even less about the corrupted structure of money and credit than the former.

The US Fed keeps talking about raising interest rates, and maybe the time has come, or will come in this lifetime, for the Federal Open Market Committee (FOMC) to act. Even the talk, though, places the Fed many cyclical furlongs ahead of its foreign counterparts. The central banks of Japan and Europe haven’t begun to acknowledge the eventual need for tighter money. Besides quantitative easing (QE) of one kind or another, Haruhiko Kuroda and Mario Draghi are dropping broad hints about the desirability of cheapening their respective currencies. Concerning the Swissie, the Swiss National Bank is reiterating its determination to print them up by the boxcar-full to protect the domestic Swiss economy against an export-thwarting Swiss/euro exchange rate.

What the mandarins share — ours and theirs — is faith in radical nostrums. Few would have contemplated these measures, let alone espoused them, much less implemented them, before 2008. The conventional monetary belief system changed in the blink of an eye. In 2002, in a speech in Washington, DC, then Fed Governor Ben S. Bernanke invoked Milton Friedman’s idea for emergency monetary stimulus. When banks are impaired and the price level sags, the stewards of a fiat currency could hire pilots and deliver their stimulus by air instead of by land, Bernanke observed. Hence the phrase “helicopter money.” Wall Street, bemusedly reading the transcript of Bernanke’s speech, dubbed the future chairman of the Federal Reserve “Helicopter Ben.” It seemed funny.

The Council on Foreign Relations lent its imprimatur to the concept of helicopter money in the September/October number of Foreign Affairs (Grant’s, 5 September). Martin Wolf, columnist at the Financial Times (FT), does the same in his new book, The Shifts and the Shocks.

You think you know what Wolf is going to say — he rarely surprises in the FT — but here he throws a curve ball. Murray Rothbard, the great capitalist, long ago made the case against fractional reserve banking. No need to run for your money in a Rothbard-approved banking system; it would never have left the vault. Wolf echoes the call for 100% reserve requirements.

The Federal Reserve's Securities Portfolio

The argument has its appeal. The semi-socialized, thoroughly cartel-ized big banks keep stepping on the same rake. QE chiefly benefits the rich because it acts through banking channels to boost asset prices. And then QE boosts them some more. By and by, there’s another crisis.

Thinking you know Wolf, you wait for him to urge an even more draconian regulatory system than the one in place. He doesn’t. Big Regulation is a failure, he allows, though not for lack of regulatory effort. In the wake of the Great Depression came the Glass–Steagall Act; it ran to 37 pages. “This time,” as he relates, “the Dodd–Frank Act ran to 848 pages and requires almost 400 pieces of detailed rule making by regulatory agencies. The total response may amount to 30,000 pages of rule making. Europe’s rule making will almost certainly be bigger still.” If the goal — always and everywhere — is to keep it simple, complexity is poison.

The answer, so Wolf proposes, is to let the government end-run the banking system by printing the money with which to pay the government’s vendors or clients. In plain English, he advocates the methods of the Continental Congress in the 1770s and the French Directory in the 1790s. Wolf is inclined to overlook the legendary inflation that turned the US Founding Fathers against fiat currency. A fine one for the silken phrases of modern economics, the columnist puts his proposition thus: “The direct monetary funding of public spending, particularly higher investment, or tax cuts would be a debt-free and highly effective way to generate additional demand.”

Debt free? Here we come to the crux of the matter. Even the 21st century paper dollar pays some small homage to classical methods. On the Fed’s balance sheet, notes and bonds “secure” greenbacks and deposits. You can’t convert a wad of dollars into Treasuries or mortgage-backed securities (MBS), but the assets do — in a formal bookkeeping sense — anchor the liabilities. A note is a promise to pay; it is a debt instrument. The bills in your wallet, you US readers, are Federal Reserve “notes.” The nomenclature is a kind of echo, a tip of the hat to the distant days of gold convertibility. Under the Wolf plan, the newly printed dollars would be secured (or backed or mirrored) by no asset. The Wolfian dollar, pound, or euro would be the purest kind of scrip, a wolf in wolf’s clothing.

What’s new here aren’t the ideas; it’s their respectability. More than five years after the start of QE1, the consumer price index (CPI) is, if anything — according to the Federal Reserve — too well contained. Interest rates have shriveled. Why not put into place a still more radical doctrine? “If you had agreed with all the academics, billionaires and politicians who denounced Federal Reserve monetary policy since the financial crisis,” Bloomberg taunted the sound money tribe, “you missed $1 trillion of investment returns from buying and holding US Treasuries.” Most nutty ideas never reach the policy-implementation stage. We would not be so quick to write off “direct monetary funding.”

It’s the way of radical monetary gimmicks that one begets another. The more they’re tried, the less they succeed. The less they succeed, the more they’re tried. There is no “exit.”

Continue reading…


#MH370 victim’s kin to sue gov’t and MAS



MH370 A family member of one of the passengers on the missing Malaysia Airlines (MAS) flight MH370 will file a lawsuit against the carrier and the government over the incident.

The law firm representing the victim’s family, Rusmah Arunan & Associates, said the suit will be filed at the Registry of the High Court in Kuala Lumpur tomorrow.

The suit cites negligence in the investigation of the incident on the part of MAS, the Department of Civil Aviation, Department of Immigration, Royal Malaysian Air Force and the Malaysian government.

The suit is being filed on behalf of the next of kin of passenger Jee Jing Hang, including his two underaged children, who have been left clueless since the flight disappeared some eight months ago.

The lawsuit also blamed the prime minister for abruptly concluding the investigation into the missing MH370 by stating that the aircraft “ended in the southern Indian Ocean”.

The law firm in a statement today said: “Such a statement from the prime minister is indeed a strong conclusion and indication. The PM made this statement in the face of the information available to him.”

Despite eight months having passed since the flight vanished, the firm claims that no proper answer had been given to the families of the victims.

“So many questions are left unanswered, so many theories have been uttered and opinions (warranted and unwarranted) are uttered. These have caused nothing but anguish, doubts and misery to them.”The firm added that its clients (Jee’s family) have decided to go ahead with the lawsuit after being counselled by lawyers and experts.

“We have spoken to various experts relating to this industry. Having carefully analysed and weighed their expert opinions, we believe that our clients have sufficient grounds in establishing such a case against the named parties,” Rusmah Arunan & Associates said.

Flight MH370, which was carrying 239 people on board from KL International Airport to Beijing, China, went missing on March 8 after departing the airport about 12.30am.

The flight, which was scheduled to land in Beijing at 6.30am, was declared missing after the air control tower lost communication with it.

Of the the people lost with the Boeing 777-200ER aircraft, 152 are from China and 50 from Malaysia. The two nationalities make up the bulk of those who went missing on the flight.

At a press conference 17 days later, Prime Minister Najib Abdul Razak said investigations have confirmed that the plane went down in the Indian Ocean.

Till today, no wreckage or body has been found despite it being more than eight months since the flight vanished into thin air.

…in another related report:
The suit will cite national carrier MAS for breach of contract and negligence and the remaining defendants — the Department of Civil Aviation (DCA), Immigration Department, Royal Malaysian Air Force and the Malaysian government — for negligence through “vicarious liability”.

Malaysia – Growing Islamic fundamentalism seen pushing Malays to quit country

The Malay Mail Online

…while I respect and empathise with the “thinking liberal Malays” to quit and leave the country under the circumstances, I Am a Malay and will not QUIT and I know of many many others who will not too. Why should I? Why should I bend to these oppressive bastards? In doing so I will be of a disservice to my race and the homeland of my ancestors. If anybody should leave it is them OBs. I will stand up and tell them to do just that. Its been a trend in this country for some pompous government ministers lately to yell “Leave if you don’t like it here!” Heck, wtf are they? … H e y,  I AM here to stay and for good! If you don’t like me…YOU leave!


Azrul Mohd Khalib (left), Malaysians for Malaysia convener, is pictured talking to participants of ‘A Walk in The Park’ along the heritage trail in George Town. — Picture by Opalyn Mok


KUALA LUMPUR, Oct 30 – Malays could be next in line after the Chinese to leave the country, in a bid to escape the growing religious fundamentalism and authoritarianism that leaves little room for free thought and dissent, according to activists and observers.

While Malaysia bills itself as a moderate Muslim nation, recent developments have demonstrated an increasingly conservative and hard-line approach to Islam here that is intolerant of cultures and practices not sanctioned by religious groups and authorities.

Malaysians for Malaysia convener Azrul Mohd Khalib said the Friday sermons prepared by the religious authorities that paint non-Muslims as enemies of Islam, as well as the use of labels such as liberalism, pluralism and humanism to vilify fellow believers, have dismayed and scared Muslims.

“Thinking Muslims are being marginalised and persecuted,” Azrul told Malay Mail Online yesterday.

“It is creating a climate of fear, suspicion and prejudice. Because of that, Muslims who do not prescribe to that belief system do not see themselves as being welcomed or even tolerated in this country,” the social activist added.

Azrul said many Muslims have started emigrating in the past 15 years based on anecdotal evidence, noting that Islamic authorities prohibit dissent and discussions of the country’s predominant religion.

“You are told ‘you cannot use logic and rationale to understand and practise Islam. ‘You must only refer to the Quran and hadith and nothing else’,” he said.

Hadith are “traditions” from the time of Prophet Muhammad that are not contained in the Quran.

Former de facto law minister Datuk Zaid Ibrahim said on Tuesday that more Malay-Muslims could be expected to leave the country if local religious authorities continue to pursue and prosecute those whose opinions they deem “deviant”.

Over the years, Islamic authorities have gradually become more rigid in their interpretation and application of the Shariah code in Islam.

They vilified and attacked a recent dog-petting event in which some Muslims touched dogs, which are considered unclean here in Malaysia. The programme triggered such outrage that its organiser received death threats.

On Tuesday, the National Fatwa Council issued an edict banning Muslims from “celebrating” Halloween, which it categorised as a Christian celebration of the dead.

Kelantan this month began enforcing a by-law that empowers state authorities to fine Muslim men up to RM1,000 or jail them for up to a year, or both, for failing to attend Friday prayers thrice in a row.

An Oktoberfest-themed beer festival in Selangor also drew the ire of Muslim groups earlier this month, despite the promotional event being targeted at and restricted to non-Muslims.

Muslim intellectual Kassim Ahmad is also being prosecuted by Islamic authorities for allegedly suggesting that Muslims need only follow the Quran, and not the accompanying Hadith. The view differs from that which is officially approved.

Malaysia has also outlawed the Shiah denomination of Islam, which it considers deviant from the Sunni school that is officially sanctioned here.

Malaysia’s religious authorities also frequently warns against liberalism, with the federal government’s Islamic Development Department (Jakim) reminding Muslims last week in its Friday sermon that this concept, along with pluralism, was a threat to Malay-Muslim unity as it could weaken their faith.

Jakim also said the National Fatwa Council had in its 74th meeting in 2006 declared liberal thinking as heretical.

“The very same liberal ideas, which are condemned and persecuted, are actually what made Islam a great humanist religion. Look back at history. Our religious authorities have lost their way and like the Pied Piper of Hamelin, are leading others astray,” Azrul said.

Social activist Datin Paduka Marina Mahathir said she knows of several Malays who say they do not want to return to their homeland.

“It’s not for economic reasons, but simply because they feel that the environment here has become so negative and oppressive that it’s impossible to be able to live as peaceful, productive citizens any more,” Marina told Malay Mail Online.

“You just never know when something that is perfectly acceptable one day becomes ‘haram’ the next day,” she added, using the Malay word for “forbidden”.

The daughter of former prime minister Tun Dr Mahathir Mohamad also noted the discomfort with the authorities’ continuous intrusion into people’s private lives at the expense of more important things such as injustice against women.

Global Movement of Moderates (GMM) CEO Datuk Saifuddin Abdullah said most of the leaders and intellectuals of “kaum muda” (young moderates) used to seek refuge in Penang and Singapore during the 1930s.

“Because in Penang and Singapore, they are more free to share their thoughts. Because there is less institutionalised religious authorities that would go after them,” Saifuddin told Malay Mail Online.

“The kaum muda were simply practising their intellectual freedom to interpret Islam in a more progressive way. And Islam allows that. You can have different interpretations. And Islam encourages dialogues among those with different opinions, not to prosecute, unless of course, if your opinion is tantamount to treason or glaringly unlawful,” the former deputy minister added.

Centre for Policy Initiatives director Dr Lim Teck Ghee said Malays in Malaysia are following the trend of Muslims in other Muslim countries who flee to Western nations, such as Australia, the US and European Union countries, to escape religious fundamentalism and political authoritarianism at home.

But he acknowledged that Malaysia has no statistics on the racial and religious breakdown of the country’s migrant outflow.

“I expect younger educated Malays to be concerned with the growing religious extremism and intolerance and to have this as the major factor in making them leave,” Lim told Malay Mail Online.

“Out-migration for Malaysians has never been solely about making a better living abroad. It has been the combination of socio-economic and political factors. Non-Malays have felt the pain of religious and racial discrimination. Now it is the turn of many Malays to feel a similar sense of deprivation and injustice,” the political analyst added.

According to a World Bank report in 2011, an estimated one million Malaysians are residing overseas.

More than two million Malaysians have emigrated since Merdeka.

Last year, a total 308,834 high-skilled Malaysians moved overseas, with 47.2 per cent going to Singapore, 18.2 per cent to Australia, 12.2 per cent to US and the rest to other countries like UK and Canada.

According to the same report, the number of skilled Malaysians living abroad rose 300 per cent in the last two decades, with two out of every 10 Malaysians with tertiary education opting to leave for either Organisation for Economic Co-operation and Development (OECD) countries or Singapore.


51 countries declare banking secrecy ‘obsolete’, sign pact in Berlin



(1st row LtoR) Spanish Finance Minister Luis de Guindos Jurado, British Finance Minister George Osborne, Organisation for Economic Co-operation and Development (OECD) Secretary General Angel Gurria, German Finance Minister Wolfgang Schaeuble, French Finance Minister Michel Sapin and Italian Finance Minister Pier Carlo Padoan pose with participants at a press conference after the signing of the Multilateral Competent Authority Agreement by more than 80 countries on October 29, 2014 in Berlin, as part of the Berlin Tax Conference. (AFP Photo)


Finance ministers from over 51 countries signed an agreement in a step closer to ending the dark financial underworld of tax-evasion and money-laundering. Another 30 countries pledged to join by 2018.

The deal is called the Multilateral Competent Authority Agreement and will look to build a collective exchange of bank accounts, taxes, assets, and income held outside local tax jurisdictions.

The two-day summit was organized by the Organization for Economic Cooperation and Development (OECD) and the Global Forum on Transparency and Exchange of Information for Tax Purposes. It was hosted by German Finance Minister Wolfgang Schauble and held in Berlin.

“Banking secrecy, in its old form, is obsolete,” German Finance Minister Wolfgang Schaeuble said in an interview in Bild on Wednesday.

The practice is “no longer appropriate at a time when people can transfer their money all over the world at the press of a button via the internet,” said Schaeuble.

Germany is a staunch opponent of Bank secrecy by geography. On its southern border lie historically secretive Austria and Switzerland, and on the western frontier is Luxembourg, also known for its tight-lipped financial institutions.

Members like the Cayman Islands, the Virgin Islands and Liechtenstein – all notorious for being tax havens, signed the agreements.

Asset hideouts like Austria, Switzerland, and the Bahamas didn’t sign the agreement itself, but promised to join the initiative by 2018.

The new American anti-secrecy measure, FATCA, added a sense of urgency to the debate.

FATCA legislation, signed into law in 2010 and enacted on July 1, 2014, requires overseas financial institutions to identify their American customers to the IRS. The law applies to any account with more than $50,000.