This page has been archived and commenting is disabled.
Memo To The Fed And Jon Hilsenrath: We're Not Here To Enrich Your Corporate Cronies
Submitted by Charles Hugh-Smith from the OfTwoMinds blog,
Memo to the Fed: you are the enemy of the middle class, capitalism and the nation.
The Federal Reserve is appalled that we're not spending enough to further inflate the value of its corporate and banking cronies. In the Fed's eyes, your reason for being is to channel whatever income you have to the Fed's private-sector cronies--banks and corporations.
If you're being "stingy" and actually conserving some of your income for savings and investment, you are Public Enemy #1 to the Fed. Your financial security is nothing compared to the need of banks and corporations to earn even more obscene profits. According to the Fed, all our problems stem from not funneling enough money to the Fed's private-sector cronies.
Fed media tool Jon Hilsenrath recently gave voice to the Fed's obsessive concern for its cronies' profits, and received a rebuke from the middle class he chastised as "stingy." Hilsenrath Confused Midde-Class "Responded Strongly" To "Offensive" Question Why It Isn't Spending.
Memo to the Fed and its media tool Hilsenrath: we're not here to further enrich your already obscenely rich banker and corporate cronies by buying overpriced goods and services we don't need. Our job is not to spend every cent we earn on interest to banks and mostly-garbage corporate goods and services. Our job is to limit the amount we squander on interest and needless spending. Our job is to build the financial security of our families by saving capital and prudently investing it in assets we control (as opposed to letting Wall Street control our assets parked in equity and bond funds).
Your zero-interest rate policy (ZIRP) has gutted our ability to build capital safely. For that alone, you are an enemy of the middle class. Let's say we wanted to buy a real asset that we control, for example, a rental house, rather than gamble our retirement funds on Wall Street's Scam du Jour (stock buybacks funded by debt, to name the latest and greatest scam).
Thanks to your policies of ZIRP and unlimited liquidity for financiers, we've been outbid by the Wall Street/private-equity crowd--your cronies and pals. They pay almost nothing for their money and they don't need a down payment, while we're paying 4.5% on mortgages and need 30% down payment for a non-owner occupied home. Who wins that bidding process? Those with 100% financing at near-zero rates.
Here's a short list of stuff we don't need to buy:
1. New house: overpriced. Debt-serfdom for a wafer-board/sawdust-and-glue mansion? Pay your banker buddies $250,000 in interest to buy a $300,000 house? Hope the bursting of the real estate bubble doesn't wipe out whatever equity we might have? No thanks.
2. New vehicle: overpriced. We can buy a good used car and a can of "new car smell" for half the price, or abandon car ownership entirely if we live in a city with peer-to-peer transport services. We can bicycle or ride a motorscooter.
3. Anything paid with credit cards.
4. Any processed food.
5. A subscription to the Wall Street Journal and other financial-media cheerleaders for you, your banker buddies and Corporate America.
How Wall Street Devoured Corporate America: Thirty years ago, the financial sector claimed around a tenth of U.S. corporate profits. Today, it's almost 30 percent
Here's how your cronies have fared since you started your low-interest rate/free money for financiers policies circa 2001: corporate profits have soared:
Now look at median household income adjusted for inflation: down 4%--inflation which we know is skewed to under-weight the big ticket items such as healthcare and college education that are skyrocketing in cost:
And here's how the middle class has fared since the Federal Reserve made boosting Wall Street and the too big to fail banks its primary goal, circa 1982: the bottom 90% have treaded water for decades, the top 9% did well and the top 1% reaped fabulous gains as a result of your policies.
If you're wondering why we're not spending, look at our incomes (going nowhere), earnings on savings (essentially zero) and the future you've created: ever-widening income disparity, ever-greater financial insecurity, ever-higher risks for those forced to gamble in your rigged casino, and a political/financial system firmly in the hands of your ever-wealthier cronies.
Capital--which includes savings--is the foundation of capitalism. If you attack savings as the scourge limiting corporate profits, you are attacking capitalism and upward mobility. The Fed is not supporting capitalism; rather, the Fed's raison d'etre is crony-capitalism, in which insiders and financiers get essentially free money from the Fed in unlimited quantities that they then use to buy up all the productive assets.
Everyone else--the bottom 99.5%--is relegated to consumer: you are not supposed to accumulate productive capital, you are supposed to spend every penny you earn on interest paid to banks and buying goods and services that further boost corporate profits.
This inversion of capitalism is not just destructive to the nation--it is evil. Funneling trillions of dollars in free money for financiers while chiding Americans for not going deeper into debt is evil.
Memo to the Fed: you are the enemy of capitalism, the middle class and the nation.
* * *
And, best of all, all of this was known and described over 100 years ago when the motives behind the Aldrich Plan were revealed to the American people, and while rejected by Congress in 1912, it served as the foundation of the Federal Reserve Act of 1913 which ultimately led to the current economic devastation.
»
- 36668 reads
- Printer-friendly version
- Send to friend
- advertisements -
note that on all the graphs showing the great divergence between the middle and the top it starts in the years just after the 1965 immigration act as that is what kept real wages static while productivity increased over the same period - all the monetary benefit of those productivity increases went to the people who opened America's borders.
JFK'S assassination was a coup. immigration, silver and "civil rights reformed"
Even the cops in California won't write $450 traffic tickets. The Lt gov is having a fit over his lost pirate revenue quotas.
They get it. Do you get it?
We can do better.
The 87 people who already own as much as the bottom half of the world's population need more money.
Why is everyone being so selfish?
I guess Ghandis proverb of "Be the change you wish to see in the world" is the only worthy assumption in this matter. We seem to have been subdued into total obedience by the governments and their laws. Rising against such power requres the idea of "greater good" and surrender of individual idea of your own life. Reason being? M.L.King, Malcom X, the Kennedys etc...all killed and removed by these very powers because they weren't afraid to fight for freedom. They believed in something much greater then themselves. And such archetypes are exactly what we need now, without brute force and weapons! Rage never leads to anything. Power of speech is the greatest weapon on earth and courage to do good.
The only reason why we fail time and again against these vicious cronies, thieves, crooks, call them whatever you want is because we are divided. And the few who do stand up against them are simply too few. The world needs not just one leader, but many, who are willing to continue the work regardless of what happens to the first one. Odds aren't exactly in favour of those who stand against the establishment. So there you go.
In other words, this position comes with:
- no physical pay
- no security
- putting in danger eveyone you love and care about
- putting your life at risk
Payoff, if successful:
Freedom!
GREAT POST!
Maybe the Fed knows their policies dont work, that the economy wont keep responding.....and this will give them an excuse to continue printing and pumping the markets....and this makes the uber rich....richer. They win, and Janet will give us the kindergarten explanation.
QUESTION THE FED!!!
GREAT POST!
Maybe the Fed knows their policies dont work, that the economy wont keep responding.....and this will give them an excuse to continue printing and pumping the markets....and this makes the uber rich....richer. They win, and Janet will give us the kindergarten explanation.
QUESTION THE FED!!!
Someone needs to walk up and sucker punch Hilsenrath right in the face.
Why not? It is what the FED does to savers and retirees every single day.
The Federal Reserve is teaching savers and retirees that wealth should not be stored in dollars.
a Dear John letter...
Dear Jon,
Please tell Dear Janet I WANT A DIVORCE!
Bye.
It’s a poker game where they are cheating you and they insist upon you putting all your money in the pot.
As masterpiece, Charles. A masterpiece!
This political cartoon is so brilliant that I got it copied onto a shirt and hand-painted END THE FED on top. Thanks, ZH. Without you, I never would have known that this existed.
IMHO, CHS is writing his best stuff ever these days. This one is like a dagger in the eye of the Fed.
Fire Angel
Alot of crews liet act like a violent mob, they need to shut the fuck up like silent bob.