The death of the middle class in America has become so painfully obvious that now even the New York Times is doing stories about it. Millions of middle class jobs have disappeared, incomes are steadily decreasing, the rate of homeownership has declined for eight years in a row and U.S. consumers have accumulated record-setting levels of debt. Being independent is at the heart of what it means to be "middle class", and unfortunately the percentage of Americans that are able to take care of themselves without government assistance continues to decline. In fact, the percentage of Americans that are receiving government assistance is now at an all-time record high. This is not a good thing. Anyone that tries to tell you that the middle class is going to be "okay" simply has no idea what they are talking about. The following are 28 signs that the middle class is heading toward extinction...
Even before the new myRA program was announced, there had been whispers about the need for the US government to assume some risk for US retirement accounts. That's code for forced conversion of private retirement assets into government bonds. As bad as it is to deceive naïve Americans into trading their hard-earned retirement savings for garbage (i.e., Treasury securities), the myRA program potentially represents something far worse... the first step toward the nationalization of existing private retirement accounts.
Show this article to anyone that believes that the economy has actually improved in the last 5 years. On Tuesday evening, the President once again attempted to convince all of us that things have gotten better while he has been in the White House. He quoted a few figures, used some flowery language and made a whole bunch of new promises. And even though he has failed to follow through on his promises time after time, millions upon millions of Americans continue to believe him. To say that his credibility is "strained" would be a massive understatement. No, things have not been getting better in America. In fact, they continue to get even worse. The following are 32 statistics that Obama neglected to mention during the State of the Union address...
Mr. Speaker, Mr. Vice President, members of Congress, fellow citizens:
...Make no mistake: the consequences of our actions are here. And the days of the United States as the world's dominant superpower are finished.
...No, this may not be the country that you all grew up in. But it is the state of our union... whatever remains of it.
As we previously noted, the 85 richest people in the world have about as much wealth as the poorest 50% of the entire global population does. In other words, 85 extremely wealthy individuals have about as much wealth as the poorest 3,500,000,000 do. There is certainly nothing wrong with making money. In fact, the founders of the United States intended for this nation to be a place where free markets thrived and where everyone could pursue their dreams. Unfortunately, this country (along with the rest of the world) has moved very much in the opposite direction. Today, we have a debt-based global financial system which is dominated by gigantic predator corporations and big banks. Working together with national governments, these corporations and banks have constructed a system in which the percentage of all global wealth that is being funneled to the very top of the pyramid steadily grows over time. The Founding Fathers were very correct to be very suspicious of large concentrations of power. In the early days of the United States, the federal government was very small and the size and scope of corporations was greatly limited. Our nation thrived and a huge middle class blossomed. Sadly, over the past several decades the pendulum has completely swung in the other direction.
Americans have never had less economic freedom than they do right now. The 2014 Index of Economic Freedom has just been released, and it turns out that the level of economic freedom in the United States has now fallen for seven consecutive years. But of course none of us need a report or a survey to tell us that. All we have to do is open our eyes and look around. At this point our entire society is completely dominated by control freaks and bureaucrats. Our economy is literally being suffocated to death by millions of laws, rules and regulations and each year brings a fresh tsunami of red tape. As you will see below, the U.S. government issued more than 80,000 pages of brand new rules and regulations last year on top of what we already had. Even if we didn't have all of the other monumental economic problems that we are currently facing, all of this bureaucracy alone would be enough to kill our economy.
In January 2009, the number of "officially unemployed" workers plus the number of Americans "not in the labor force" was sitting at a grand total of 92.6 million. Today, that number has risen to 102.2 million. That means that the number of working age Americans that are not working has grown by close to 10 million since Barack Obama first took office. The cold, hard reality of the matter is that there has not been an economic recovery in this nation. Anyone that tries to tell you that is lying to you. If we were going to have a recovery, it would have happened by this point. In fact, this is all the "recovery" that we are going to experience. From here on out, this is about as good as things are going to get.
It has been commonplace to speak of central bank independence - as if it were both a reality and a necessity. Discussions of the Fed invariably refer to legislated independence and often to the famous 1951 Accord that apparently settled the matter.  While everyone recognizes the Congressionally-imposed dual mandate, the Fed has substantial discretion in its interpretation of the vague call for high employment and low inflation. It is, then, perhaps a good time to reexamine the thinking behind central bank independence. There are several related issues.
- First, can a central bank really be independent? In what sense? Political? Operational? Policy formation?
- Second, should a central bank be independent? In a democracy should monetary policy—purportedly as important as or even more important than fiscal policy—be unaccountable? Why?
- Finally, what are the potential problems faced if a central bank is not independent? Inflation? Insolvency?
Perhaps the most amusing and curious aspect of this entertaining summary of the Mississippi Bubble of 1720, the resulting European debt crisis (the first of many), how bubble frenzies are as old as paper money, the man behind both - convicted murderer and millionaire gambler, John Law, what happens when paper money's linkage to gold is broken, and how everyone loses their wealth and hyperinflation breaks out, is who the source is. The New York Fed. Perhaps the Fed-employed authors fail to grasp just what their institution does, or have a truly demonic sense of humor. In either case, the following "crisis chronicle" highlighting how banking worked then, how it works now, and how it will always "work", is a must read by all.
The evidence here is clear. QE does not generate jobs in the broad economy.
Yesterday we described how so-called "Progressives" are pimping for the Empire. The same is true of so-called "Conservatives." Conservatives are masters at projecting a preachy devotion to a limited state, democracy, liberty and free enterprise while their support of the Central State undermines every one of these values. Conservatives are like the preacher who issues stern sermons on righteousness every Sunday while skimming big money from pimping sordid, destructive policies Monday through Saturday. "Conservatives" and "Progressives" alike are pimping for the Empire when they support the Central State's essentially unlimited powers.
It’s ironic that in a day and age where Keynesian economics is the “accepted view” we still don’t pay enough attention to what Keynes said about inflation: "By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some..." The problem today is that some people believe inflation is lower than it actually is. The Consumer Price Index CPI is used to measure the cost of maintaining a certain standard of living. Now it measures the cost of maintaining a certain level of satisfaction. You can argue the magnitude of the inflation understatement but you can’t argue that the official numbers are accurate. Under reporting inflation has led to many predictable outcomes.
2013 Was A Year Of Calm In The World Of Finance ... 2014 May Not Be So Calm ... Highlights Of Year - German Gold Repatriation, Record Highs In Yen, Huge Chinese Demand - Lowlights Of Year - Massive Paper Sell Offs in April/June and First Deposit Confiscation and Capital Controls ...
As usual, in 2013, sticking to facts was a mistake in a world fueled by misinformation, propaganda, delusion and wishful thinking. Those in power have successfully held off the unavoidable collapse which will be brought about by their ravenous unbridled greed, and blatant disregard for the rule of law, the U.S. Constitution and rights and liberties of the American people.
"There is no disputing the facts. The economic situation is deteriorating for the average American, the mood of the country is darkening, and the world is awash in debt and turmoil. Every country is attempting to print their way to renewed prosperity. No one wins a race to the bottom. The oligarchs have chosen a path of currency debasement, propping up insolvent banks, propaganda and impoverishing the masses as their preferred course. They attempt to keep the masses distracted with political theater, gun control vitriol, reality TV and iGadgets. What can be said about a society where 10% of the population follows Justin Bieber and Lady Gaga on Twitter and where 50% think the National Debt is a monument in Washington D.C. The country is controlled by evil sycophants, intellectually dishonest toadies and blood sucking leeches. Their lies and deception have held sway for the last four years, but they have only delayed the final collapse of a boom brought about by credit expansion. They will not reverse course and believe their intellectual superiority will allow them to retain their control after the collapse.”
The world has depended on Chinese and American stimulus for years, and, as Caixin's Andy Xie notes, one implication of their tightening is a slowing global economy in 2014.