When Biden took office, one of his first acts was the elimination of our border security. Like a power-hungry dictator, Biden simply decided to ignore our immigration laws. His catastrophic border policy resulted in untold millions of unidentified foreign citizens from around the world pouring into our country. Its impact is now being felt in cities across the country. The worst is yet to come. PETER LEMISKA - AND WE'RE ALREADY THERE!!!
Tuesday, December 4, 2018
THE LOOMING DEPRESSION .... will not hit the rich!
Part of the yield curve inverted on Monday, the first time this has happened since 2007.
That sent jitters through the stock market as investors worried it could foreshadow slower growth or even a recession in the future. The Dow Jones Industrial Average fell by 600 points, or 2.32 percent, on Tuesday morning.
The yield curve is a way to show the difference in compensation investors get depending on how long a bond takes to mature. Most of the time, the curve slopes upward because investors usually want to be paid more in exchange for locking their money up for longer.
But at times the relationship can flip, or invert, with shorter-term bonds yielding more than longer-term bonds.
That’s what happened on Monday and Tuesday. First, the yield on five-year Treasurys dipped below three-year Treasurys. That was closely followed by the five-year yield falling below two-year yields.
This can be an indicator that investors think the Federal Reserve will have to cut its short-term interest rate target because of slumping economic growth or an approaching recession.
In other words, the inversion is the latest piece of evidence that the Federal Reserve may be acting too aggressively in raising interest rates. Although the economy has many areas of strength, particularly in the labor market and manufacturing sector, the more interest-sensitive areas–such as housing and autos–have been weak.
The last time the three-year yield fell below the five-year, the economy slipped into a recession in the following year. Recessions also followed similar inversions in 1990 and 2001.
But the crystal ball of the yield curve is murky. Bespoke Investment Group said in the last three recessions the first inversion of three-year and the five-year yields came an average 26.3 months before the start of a recession, with a range between 17 and 38 months.
And an inverted yield curve does not always predict a recession. The gap between the two-year and five-year yields turned negative in 1998, for example, but no recession followed until after the gap between the two-year and 10-year yield inverted in 2000.
When the gap between the 10-year Treasurys and 2-year turns negative, the yield curve is said to be inverted. This can indicate a recession is approaching.
The most closely watched parts of the curve are the gaps between the two-year to ten-year yield curve and the three-month to ten-year curve. These are thought to be the best predictors of a recession. Studies by Federal Reserve economists say we should pay particular attention to the three-month to ten-year gap. And these are still positive, although the gap is narrowing as the yield on ten-year Treasurys has fallen further than short-term yields.
The 2-year yield Tuesday was around 12 basis points–each basis point is a one-hundredth of a percentage point–below the 10-year yield, while the 3-month yield was about 50 basis points below from the 10-year.
History suggests that a temporary inversion in discrete parts of the curve is not all that predictive. Nor does a flatter yield curve have much predictive power. So if the three-month and two-year yields stay above the ten-year, a slump or recession may not be in the offing.
The yield curve may also have lost some of its predictive power. Very large budget deficits have increased the amount of bonds the government is selling. The government’s choices about which bonds to sell could cause an over-supply or under-supply in some parts of the yield curve, which in turn could invert the curve.
The Federal Reserve’s actions as it shrinks its balance sheet, inflated from years of bond buying under the central bank’s quantitative easing program, may also be putting pressure on the curve. This is largely an unprecedented event so its effects are hard to predict and likely will not be known for years.
The bond market is often fickle. In the early months of this year, the market was signaling that the Fed was expected to raise interest rates three times in 2019. Now it sees rates rising once or, possibly, twice.
TRUMP’S SECRET
AMNESTY, WIDER OPEN BORDERS DOCTRINE TO KEEP WAGES DEPRESSED.
"During the same month that
Schlafly had backed Trump for his “America First” agenda, Nielsen’s committee
released an ideologically-globalist report, promoting the European migrant crisis
as a win for big business who would profit greatly from a never-ending stream
of cheap, foreign
migrants."
AMERICA: ONE PAYCHECK AND TWELVE
ILLEGALS AWAY FROM HOMELESSNESS!
A dashcam video of downtown Los Angeles on
Christmas day reveals a stunning sight: hundreds of tents and lean-tos on the
sidewalks that serve as shelter for the homeless. The scene is reminiscent of a
third-world country. RICK MORAN / AMERICANTHINKER
com
HOMELESS CRISIS IN LOS ANGELES,
MEXICO’S SECOND LARGEST
CITY WORSENS BY THE DAY…. Approximates the great depression
The housing market was even weaker in October than expected.
Pending home sales, based on signed contracts to buy existing homes, fell 2.6 percent compared with September, for a year-over-year decline of 6.7 percent.
Last month, however, pending sales broke a long-streak of month-over-month declines. That flicker of hope for the housing market, which has been the weakest part of an otherwise very strong economy, was effectively extinguished by October’s data.
On a year-over-year basis, this gauge of the housing market has fallen for ten-months in a row.
The disappointing data on Thursday follows close on the heels of lower-than-expected new home sales data on Wednesday. These fell 12 percent year-over-year, according to the U.S. Census.
The decline in sales is largely blamed on a decline in affordability. Home prices are up by more than incomes and mortgage rates have climbed as the Fed hiked rates this year.
Another housing bubble is beginning to burst. Its financial characteristics are different from the 2007-8 housing bubble but it shares one thing in common -- that it is caused by government policies.
The 2007 bubble was caused by the Federal government insisting on home loan qualification standards changes. Buyers who were not qualified to obtain traditional home loans were encouraged and even subsidized to get loans in states such as IL, CA, NJ, PA, and all other areas. The details of these changes were documented by Pinto and Wallison.
The bubble burst because the easy money home loan qualification changes created two prongs of financial instability: 1) persons who were not qualified were allowed to obtain mortgages and 2) the easy money policies rapidly escalated home prices and placed many mortgage holders underwater when the artificially high housing prices crashed.
This bubble now being created in the biggest Blue states, while being driven by government policy, has a completely different financial dynamic. This dynamic is best understood by looking at the financial condition of Illinois.
The financial insolvency of Illinois is directly linked to its public-sector pension system. The unfunded public pension liability of the state is $251 billion. But that one fact is only part of the story. In addition to having this unfunded pension liability, the state now dedicates one-fourth of its annual state budget to pension costs. In order to finance the ongoing demands of the public pension system (Illinois has 650 pension plans throughout the state) the state seizes state grant money and state funds lawfully appropriated to pay for public services throughout the state and puts those into the pension fund located in the state capital, Springfield. Since there are 4.8 million households in Illinois the average household owes $52,269 to the unfunded pension costs, and these go up every hour. And in addition to that one-fourth of the Illinois state budget goes to pensions.
The amount of money the state has seized from public services can be seen by the fact that in 2016 the state owed vendors $15.9 billion and another $2.8 billionwas seized from funds allocated to pay for health care vendors. This means the state literally seizes lawfully appropriated funds from state-mandated health care programs such as nursing homes and medication and places them in its pension fund.
Illinois has two state statutes that allow the state to seize both state grant money passed by the General Assembly allocated for state grants and another statute that allows the pension fund to seize state funds.
In addition to these seized state funds, the Illinois Policy Institute, a watchdog group in Illinois, audited all 110-plus cities of Illinois and found that in the ten biggest cities, including Chicago, all the property taxes people pay go only to pay pensions, not to fund public services such as water and sewer, police and fire protection, and other essential services.
The core issue then is whether the demand for property-tax revenue made by the public pension plans will have an effect on housing values, and if this effect will be strong enough to create a housing bubble.
The best illustration of the current housing bubble can be seen with a specific example. I know a person on the northwest side of Chicago, a middle-class neighborhood, who recently received, in his July 2018 property tax bill, a raise of $10,000 on his annual tax payment. This was not a raise in the assessed value of his house, this was a raise in the tax that is due. The house is 2,200 square feet and since the owner now wants to sell the house, it was recently assessed as having a fair market value of $348,000. Before this $10K property tax increase, the property tax bill of the house was already at $13,800. So if anyone wants to buy a house worth $348,000 they have to pay $1,983 per month in property taxes. The mortgage will be about $1,350. per month, so the total payment will be $3,333 a month for a house worth $348K. And each year the property tax will only go up.
What this means is that anyone who buys this house will already be paying a 7% property tax rate on the market value of the house. That monthly property tax bill normally is for a house worth $1.2 million dollars at a 2% property tax rate. No matter how one looks at this, it is foolish for a person to pay a property tax bill for a $348K house when at a 2% tax rate they could have a house worth $1.2 million. While this is a quick back-of-the-envelope financial analysis, the trend is clear: Illinois has the highest tax burden of any state.
The Chicago Federal Reserve bank should be doing a precise analysis of this impending housing crisis, but instead recently suggested a 43% property tax hike.
This is the bubble: homeowners are losing most, if not all, of the equity they have in their homes. And once again it is being done by government. This time it is not the federal government that is changing home mortgage loan lending standards but the Illinois state pension fund that is literally seizing home equity value to pay their pension demands. And while this is happening, Illinois wastes over one billion dollars on interest needed to service what they've borrowed.
To understand how great the demand for tax revenue is in Illinois consider the fact that the largest pensions go to retirees from SURS the State University Retirement System. The actual facts from Taxpayers United show that of the 200 top pensions going to university retirees, the lowest is $199,000 per year and the highest is $581,000 a year. This is not a projection, this is the information from 2017. To finance these pensions, young people who take out student loans are also seeing a drop in their long-term incomes. The Illinois Policy Institute reported that in Illinois public universities, half of the tuition goes to pensions. So when students graduate from an Illinois public university, half their monthly student loan payment will go to extravagant pensions, and the voters of Illinois have no say in these pensions.
This means these graduates have less money to purchase a home. As a result, the young people in Illinois are the largest age group that is fleeing the state. They see the writing on the wall and cannot imagine they could ever afford a home and family in Illinois. More than 80% of Illinois counties saw population losses in 2017.
The bubble is bursting right now in Illinois and in CA, PA, MA, CT, NJ, NY, and all other big Blue states. California alone has a half-trillion-dollar unfunded pension liability. The financial mechanics
Democrats nominate Pelosi as House speaker, reelect top aides
29 November 2018
In a clear demonstration that the Democratic takeover of the House of Representatives will produce no significant shift in US capitalist politics, the House Democratic Caucus has reelected its three top leaders, 78-year-old Nancy Pelosi, 79-year-old Steny Hoyer and 78-year-old James Clyburn.
All three are indelibly associated with the right-wing record of the Democratic Party during its last period in control of the House of Representatives, from January 2007 to January 2011, when Pelosi was House speaker, Hoyer was majority leader and Clyburn was majority whip.
BLOG: WAR PROFITEER SEN. DIANNE FEINSTEIN IS A MAJOR DONOR TO ALL OF PELOSI'S CAMPAIGNS. IT DOES NOT MATTER WHO IS PRESIDENT, THEY ALL SERVE THE SAME PAYMASTERS ON WALL STREET.
During the first two years, with George W.
Bush in the White House, Pelosi and her two
top aides blocked any effort to impeach Bush
for the lies that paved the way for the war in
Iraq, while supporting full funding of the
murderous US military interventions in both
Iraq and Afghanistan. Pelosi has adopted a
similar stance in relation to a possible
impeachment of Donald Trump, whose
assault on the Constitution is even more
flagrant than that of Bush.
During the next two-year period, under the
Obama administration, the Pelosi-Hoyer-
Clyburn leadership spearheaded passage of
the reactionary Affordable Care Act, whose
purpose was to shift the cost of health care
from corporations and the government onto
the backs of working people; pushed through
the Dodd-Frank legislation, which gave a slap
on the wrist to the Wall Street criminals who
caused the 2008 financial crash; and lavishly
funded the US wars in Iraq and Afghanistan,
under Obama’s leadership, and the
expansion of drone warfare throughout the
Middle East and North Africa.
The Democrats were swept out of power in the House of Representatives in the 2010 elections, in large measure because of popular disappointment with the failure of the Obama administration to provide any serious remedy for the economic slump that followed the 2008 Wall Street crash. Obama and the Democrats bailed out Wall Street but pushed through wage cuts for auto workers and other sections of the working class.
After eight years in the minority, the Democrats recaptured a House majority in the November 6 elections. They were the entirely undeserving beneficiaries of the broad popular hostility to the Trump administration and the Republicans, which under the US political system can find no electoral expression except in a vote for the other half of the two-party duopoly, in this case, the equally right-wing and pro-corporate Democrats.
Wednesday’s caucus vote follows several weeks of maneuvering and horse-trading by the Democratic leadership, mainly involving small groups of representatives whose perspective and program is generally more right-wing than Pelosi’s. These include the Blue Dogs, a group of several dozen Democrats committed to fiscal austerity; the Problem-Solvers Caucus, a bipartisan group of 12 Democrats and 12 Republicans; and an informal “stop Pelosi” group spearheaded by Seth Moulton of Massachusetts, an Iraq War military officer, and Kathleen Rice, a former prosecutor from Long Island.
Pelosi met with Moulton, Rice and Representative Tim Ryan of Ohio, who ran against her in 2016 but declined to do so this year, just before the House Democratic caucus meeting. Moulton said afterwards that they pressed Pelosi to outline a “transition” in leadership—i.e., to announce that this would be her last term as Democratic leader—but she declined to do so.
By contrast, Pelosi had the full and unreserved support of Alexandria Ocasio-Cortez and Rashida Tlaib, the two newly elected representatives who claim membership in the Democratic Socialists of America, as well as other candidates hailed by the pseudo-left because of their racial or gender identities: Ayanna Pressley of Boston (the first African-American representative from Boston), Sharon Davids of Kansas City (the first Native American lesbian representative), Ilhan Omar of Minneapolis (along with Tlaib, the first Muslim woman representative), and so on.
In the caucus vote Wednesday, Pelosi prevailed easily, 203–32. The 32 votes against her were only half the 63 votes won by Ryan two years ago, when he challenged Pelosi for reelection as minority leader.
Pelosi was compelled to negotiate with the right-wing caucuses only because the speaker, unlike the majority leader or minority leader, is chosen by all 435 members of the House of Representatives, requiring 218 votes for election. The 203 votes she received in the caucus ballot was 15 votes short of the 218 she will need in January, when the new House session begins.
Many of those voting against Pelosi Wednesday had pledged to oppose her for speaker during their election campaigns, mainly to appease right-wing criticism of Pelosi’s supposed liberalism.
In an effort to secure the necessary votes for January, Pelosi crafted a cynical process for the caucus vote, allowing representatives to cast “no” votes against her even though she was the only candidate nominated, so they could cite the caucus vote as proof that they had honored their campaign promise.
Although the vote was supposedly by secret ballot, representatives who so desired were even encouraged to take selfies with their “no” votes so they could prove in future electoral campaigns that they had opposed Pelosi, even after they cast a vote for Pelosi in January, when the vote really counts.
As Politico wrote, summing up the cynical maneuvering: “The unusual move allows members from swing districts who ran on a platform of opposing Pelosi to say they did so when they return home. In fact, Pelosi allies have actually encouraged some members-elect to oppose her in caucus so they can tell constituents they tried to push her out of the job—and then back her during the more critical Jan. 3 floor vote to officially become speaker.”
For all other leadership positions no such elaborate pretenses were required, since a simple majority of the caucus decided the winner. Accordingly, for the other two top positions where there was only one candidate, House majority leader and House majority whip, Hoyer and Clyburn were elected by acclamation.
The lesser positions in the Democratic leadership were filled in part by acclamation and in part by contests. Ben Ray Luján of New Mexico, who headed the Democratic Congressional Campaign Committee, which oversaw the vetting and nomination of Democratic candidates—mainly to promote the most right-wing candidates, particularly those with a military-intelligence background—won the position of assistant majority leader, effectively the number four leadership position, without opposition.
In the contest for chairman of the Democratic Caucus, the number five position, Hakeem Jeffries of Brooklyn, New York, defeated Barbara Lee of Oakland, California, by 123–113. This was billed as a largely generational contest, since Jeffries is 48 and Lee, 72, and without political significance, since both are members of the Congressional Black Caucus and the Progressive Caucus. However, Lee was the only member of Congress to vote against the 2001 Authorization for Use of Military Force after the 9/11 attacks, which Bush cited as the legal basis for his invasion and occupation of Afghanistan. She also voted against the USA Patriot Act.
Pelosi coopted potential opponents by creating several new lower-level leadership positions for which they could run, including the assistant majority leader position set aside for Luján, and various subordinate positions on the Democratic Congressional Campaign Committee. Voting for these offices continued into Wednesday evening and perhaps into Thursday.
In another significant initiative, Michigan Representative-elect Elissa Slotkin, one of the two former CIA operatives elected as Democrats on November 6, drafted a letter to Pelosi on behalf of the incoming freshman class, which numbers 62 newly elected Democrats, asking the Democratic leadership to setaside positions on the powerful Appropriations, Rules, Ways and Means, Energy and Commerce, and Financial Services committees for new members. Slotkin also asked for two freshmen to be seated on the Steering and Policy Committee, which decides on committee assignments and sets legislative strategy.
THE CONSPIRACY TO SABOTAGE HOMELAND SECURITY
The Democrat Party’s secret agenda for wider open borders, more welfare for invading illegals, more jobs and free anything they illegally vote for…. All to destroy the two-party system and build the GLOBALISTS’ DEMOCRAT PARTY FOR WIDER OPEN BORDERS TO KEEP WAGES DEPRESSED.
Demonstrably and irrefutably the Democrat Party became the party whose principle objective is to thoroughly transform the nature of the American electorate by means of open borders and the mass, unchecked importation of illiterate third world peasants who will vote in overwhelming numbers for Democrats and their La Raza welfare state. FRONTPAGE MAG
GENERAL MOTORS DUMPS THOUSANDS OF WORKERS AND CLOSES PLANTS-Stockholders celebrate!
"It identifies socialism with proposals for mild social reform such as “Medicare for all,” raised and increasingly abandoned by a section of the Democratic Party. It cites Milton Friedman and Margaret Thatcher to promote the virtues of “economic freedom,” i.e., the unrestrained operation of the capitalist market, and to denounce all social reforms, business regulations, tax increases or anything else that impinges on the oligarchy’s self-enrichment."
“The yearly income of a typical US household dropped by a massive 12 percent, or $6,400, in the six years between 2007 and 2013. This is just one of the findings of the 2013 Federal Reserve Survey of Consumer Finances released Thursday, which documentsa sharp decline in working class living standards and a further concentration of wealth in the hands of the rich and the super-rich.”
"The American phenomenon of record stock values fueling an ever greater concentration of wealth at the very top of society, while the economy is starved of productive investment, the social infrastructure crumbles, and working class living standards are driven down by entrenched unemployment, wage-cutting and government austerity policies, is part of a broader global process."
"A defining expression of this crisis is the dominance of financial speculation and parasitism, to the point where a narrow international financial aristocracy plunders society’s resources in order to further enrich itself."
BEL AIR MAXINE WATERS AND HER CRACK ALLEY CONSTITUENTS
WALL STREET BANKSTERS AND THEIR BOUGHT DEMOCRAT POLS PREPARE FOR THE NEXT WAVE OF BOTTOMLESS NO-STRING BANKSTER BAILOUTS…
Will this one finish off the American economy?
Considering her record and documented history of poor ethical and moral fitness, it’s outrageous that Maxine Waters is up for chair of the ultra-powerful House Financial Services Committee, which has jurisdiction over the country’s banking system, economy, housing, and insurance.
The Moelis plan stands out as a strikingly bold grab for control of the companies and their profits. It calls for the dividend payments to the Treasury to cease so that the companies can rebuild capital. Shockingly, it also calls for the cancellation of the senior preferred stock altogether–with no compensation for the past risk and future profits currently due to taxpayers. It is as if a company proposed to do a stock buyback by proposing to cancel its shares rather than purchasing them for cash.
So will Maxine Waters be the crusading financial protector of our 401k plans and save America from the next financial bubble? Well, there will certainly be lots of harassment and shakedowns. But don't count on her steering us clear of Wall Street excesses. If history is any guide, Mad Maxine will be way too busy raising money from the people she is now in charge of regulating. Stephen Moore is a senior fellow at The Heritage Foundation
Waters, who represents some of Los Angeles’ poorest inner-city neighborhoods, has also helped family members make more than $1 million through business ventures with companies and causes that she has helped, according to her hometown newspaper. While she and her relatives get richer (she lives in a $4.5 million Los Angeles mansion), her constituents get poorer. JUDICIAL WATCH
VIVA LA RAZA SUPREMACY, WIDER OPEN BORDERS, CHAIN MIGRATION, NO LEGAL NEED APPLY and BILLIONS IN WELFARE TO KEEP THEM CRAWLING OVER OUR BORDERS???
DEMOCRAT PARTY CORRUPTION
"This is how they will destroy America from within. The leftist billionaires who orchestrate these plans are wealthy. Those tasked with representing us in Congress will never be exposed to the cost of the invasion of millions of migrants. They have nothing but contempt for those of us who must endure the consequences of our communities being intruded upon by gang members, drug dealers and human traffickers. These people have no intention of becoming Americans; like the Democrats who welcome them, they have contempt for us." PATRICIA McCARTHY
Congressional Democrats are apparently fine with catch-and-release policies because they see the likely electoral benefits. According to Customs and Border Protection (CPB), of the 94,285 Central American family units apprehended last year, 99 percent of them remain in the country today. CPB also reports that 98 percent of the 31,754 unaccompanied minors from the Northern Triangle of Central America remain in the country. CAL THOMAS
THE (REALITY) OF THE GLOBALIST DEMOCRAT PARTY AS IT SERVES THE RICH:
Anti-Semitic, open borders for cheaper labor and funded by criminal banksters… and these pols are making vast fortunes sucking the blood of America!
We must not let them cheat their way to power over the rest of us. Their ongoing vote fraud must be stopped and the Democrats need to take a look at themselves and at what they have become. It's not a pretty picture. What they have become threatens to destroy the greatest nation on the planet and they are doing it on purpose. They have nothing but contempt for the US as founded and for those of us who love this country. PATRICIA McCARTHY – AMERICAN THINKER
“Then we suffered the rattling election of Barack Obama, whose active membership in a white-, Jewish-, and America-hating church was well known to the electorate. His close personal relationship with the likes of his adored Rev. Jeremiah Wright and Louis Farrakhan was no secret. Obama was open about his goals. He told us he was out to "fundamentally transform America" and the world.” ALAN BERGSTEIN
“There is a deep racist and anti-Semitic disease in the leadership of the Democrats. As Senator Cory Booker brings his hatred for the Jewish State to the Senate, he should be asked whether he agrees with his hero, “The only good Zionist is a dead Zionist we must take a lesson from Hitler”. DANIEL GREENFIELD
"In fact, the destruction has again exposed the criminal indifference and negligence of the ruling class and both its political parties, Democrat and Republican. Social infrastructure, including fire departments, have been starved of funds for decades as trillions of dollars have been funneled into the bank accounts of the rich."
WHY DID THE FIRST LADY OF CORRUPTION and AMERICA’S
GREATEST WAR PROFITEER SENATOR DIANNE FEINSTEIN and her cronies PACIFIC GAS & ELECTRIC BURN DOWN MEXIFORNIA?
"In fact, the destruction has again exposed the criminal indifference and negligence of the ruling class and both its political parties, Democrat and Republican. Social infrastructure, including fire departments, have been starved of funds for decades as trillions of dollars have been funneled into the bank accounts of the rich."
With signs of economic weakness popping up everywhere, the Federal Reserve has come under increasing pressure to slow down the pace of interest rate hikes. The Fed has hiked rates six times since President Trump took office and is on track to up the pinch point again in December. The Fed’s interest rate policy has long been material for financial new headlines, but it is only part of the current cycle of monetary tightening. Another part is the admittedly wonkish issue of reducing the Fed’s balance sheet. Policymakers should give it more prominence because it is siphoning billions of dollars out of the economy. Some analysts go so far as to say that, coupled with interest-rate hikes, it could tip the U.S. into recession.
Today the Federal Reserve owns some $4.1 trillion in financial assets, most of which are intermediate-term U.S. Treasury bonds of five to seven years maturity, but it also shows $1.6 trillion in mortgage-backed securities on its books. The Fed acquired this stash during the global financial crisis and its aftermath. In the period 2008-14, the Federal Reserve periodically made large-scale security purchases from its primary dealers. We can thank the Fed for that move, since by many accounts it averted another Great Depression.
Collectively, this process was known as “quantitative easing.” It gave the Fed a way of injecting liquidity directly into the economy without waiting for the slower and more indirect effect of near-zero interest rates. Accordingly, the primary dealers sold securities to the Fed, and in exchange, their accounts at the Federal Reserve were credited money. These transactions were an exercise in money creation. Trillions of dollars thus came into existence and entered the economy.
In principle the Fed could sell off its assets, but selling a bond portfolio in the trillions of dollars could disrupt the markets. So in late 2017 the Fed announced it would just let the bonds run to their maturity dates and would not use any proceeds to buy new bonds. When any bond matures, the owner receives its face value in cash from the issuer. The Fed is presently receiving about $50 billion a month from the U.S. Treasury for bonds reaching maturity.
Whenever any of its bonds reaches maturity, the Fed simply removes it from its balance sheet, and the money paid at maturation by the Treasury Department is extinguished. The Fed makes those dollars go out of existence. So far billions of dollars have been taken out of the economy, at a pace of $600 billion a year.
The process of reducing the balance sheet is the mirror image of the Fed’s acquisition of assets in 2008-14. Today the Fed wants to get its balance sheet down to fighting weight so that it could move into action should a future contingency arise calling for another round of quantitative easing. The Fed describes this process as “balance sheet normalization,” but outside observers more commonly refer to it as “quantitative tightening,” or QT, because it results in draining liquidity from the economy.
Some observers say that QT is compounding the contractionary effect of the Fed’s interest rate hikes. Ben Steil and Benjamin Della Rocca of the Council on Foreign Relations estimate that by the end of 2019 QT will have the effect of adding 2.2 percent to interest rates. The implication is that if the Fed achieves its goal of pegging short-term rates at about 3 percent, the economic environment would sense those rates as though they were actually 5.2 percent. This projection is grounds for concern about a recession.
The Federal Reserve does not consider its drawdown of assets as a tool of monetary policy. That may be so, and it should be said that the Fed is acting prudently in seeking to address the legacy resultants of its market interventions during the period of quantitative easing. Nonetheless, the Fed mischaracterizes balance sheet normalization. If during 2008-14 the Fed acquired trillions of dollars worth of assets explicitly for the purpose of injecting liquidity into the economy, in what way does the offloading of the same assets not affect that liquidity, but only in the opposite direction? To an outside observer, balance sheet normalization looks suspiciously like a monetary tool in everything but name.
Instead of thinking of QT as something that goes on behind the scenes, like a computer program running in the background while the interest rate story plays out on the active screen, bring it forward for a moment and take another look around. When we take QT as an element of monetary policy, we begin to see current economic conditions in a different light. With QT up front we are better able to explain the recent deflationary trends in commodity prices, and we can get a different perspective of why the housing industry is soft and why equity prices have tanked. If we take QT and interest rates together as reinforcing moves, we get a fuller appreciation of the monetary forces at work that point to slower economic growth ahead and possible recessionary conditions.
Today the U.S. economy is suffering from a dollar dearth. In putting its own balance sheet on a weight-loss regime, the Fed has also put the economy on a dollar-restricted diet. The Fed’s drawdown of its assets is siphoning billions of dollars out of the economy. This does not mean the money supply is shrinking, but it does mean that balance sheet normalization dampens its growth. This would be seen more clearly if QT were brought forward and its implications explored more explicitly.
Here’s the dilemma: if the Fed continues to raise interest rates and to reduce its balance sheet, it will tip the U.S. into recession. But if it pauses on interest rates, it would also have to pause on reducing its balance sheet, for to do the one without the other would be incoherent. A slower pace on the asset drawdown means the Fed would roll over all or part of the funds it receives when bonds mature into buying new bonds. The Fed would be back in the asset-buying business again, not necessarily as a rerun of the 2008-14 quantitative easing, but such a move could give rise to an inflationary mess.
Nonetheless, if economic conditions continue to weaken, and if Wall Street feels more pain, the Fed may have to opt for some kind of a double pause on interest rates and on balance sheet normalization. A carefully calibrated policy to reinflate may be unavoidable.
One way to do this would be to use a commodity-based index to gauge the amount of dollars demanded by the economy, and to adjust interest rates and the asset drawdown accordingly. Using gold as a proxy, the Fed should try to raise its price to a range within several of its long-term averages. Right now, the price of gold is below those averages. It is saying the markets need more dollars. The Federal Reserve should be injecting, not draining, liquidity from the economy.
James Soriano is a retired Foreign Service Officer.
THE SUPREME COURT CONSIDERS ITSELF TO BE THE PREMIER SERVANT OF WALL STREET. EXPECT THAT THE COURT WILL BLAME UNDERLINGS FOR ALL THE BANKSTERS' PLUNDERING CRIMES THEY FILLED THEIR POCKETS WITH!
"Back during he the financial crisis of 2008 to 2009, which wiped out trillions of dollars of the wealth and retirement savings of middle-class families, we put the two major arsonists in charge of putting out the fire. Former Democratic Sen. Chris Dodd of Connecticut and former Democratic Rep. Barney Frank of Massachusetts were the co-sponsors of the infamous Dodd-Frank regulations. Readers will recall that good old Barney resisted every attempt to reign in Fannie Mae and Freddie Mac and said he wanted to "roll the dice" on the housing market. That worked out well"
“Our entire crony capitalist system, Democrat and Republican alike, has become a kleptocracy approaching par with third-world hell-holes. This is the way a great country is raided by its elite.” ---- Karen McQuillan THEAMERICAN THINKER.com
“This was not because of difficulties in securing indictments or convictions. On the contrary, Attorney General Eric Holder told a Senate committee in March of 2013 that the Obama administration chose not to prosecute the big banks or their CEOs because to do so might “have a negative impact on the national economy.”
“Attorney General Eric Holder's tenure was a low point even within the disgraceful scandal-ridden Obama years.” DANIEL GREENFIELD / FRONTPAGE MAG
Supreme Court Considers Who Bears Responsibility for Security Fraud
An investment banker who sent deceptive emails dramatically overstating the financial health of a failing clean energy company shouldn’t be held responsible for securities fraud because he was only following his supervisor’s directions, the man’s attorney told a skeptical Supreme Court.
U.S. securities laws forbid those offering securities for sale from making false statements or participating in fraudulent schemes. Whether a person who merely passes the bad information along is legally liable is at issue in this case.
The company, Waste2Energy Holdings Inc. of Neptune Beach, Florida, founded in 2007, went out of business in 2013 after filing for Chapter 11 bankruptcy. The company had hoped to develop technology to convert waste into energy but failed to do so.
In 2009 Francis V. Lorenzo, then the director of investment banking at the brokerage Charles Vista LLC, emailed prospective investors offering for sale $15 million in debentures secured only by W2E’s earning capacity.
The emails indicated that W2E had $10 million in assets and purchase orders north of $40 million, and that the brokerage was willing to raise money to repay investors if needed.
But at the time the emails were sent, the company had already acknowledged that an audit had determined its assets were worth much less than $1 million.
Lorenzo’s boss and the brokers settled the claims the U.S. Securities and Exchange Commission (SEC) brought but Lorenzo refused. An SEC administrative law judge found Lorenzo’s superior drafted the emails but that Lorenzo had nonetheless broken the law by sending them because they contained false information about W2E’s financial situation.
The SEC banished Lorenzo from the securities industry for life and imposed a $15,000 civil penalty.
A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit ruled against Lorenzo in 2017, finding that he participated in a scheme to defraud investors by sending the misleading emails even though he was not deemed to have made the untrue statements himself.
Lorenzo disagreed with the circuit court and the Supreme Court decided June 18 to hear his appeal. He argues that at most he may have aided and abetted a fraudulent scheme as a “secondary” violator of securities laws.
Borrowing language from the Supreme Court’s ruling in the 2011 case, Janus Capital Group Inc. v. First Derivative Traders, Lorenzo argued that because he did not have “ultimate authority over the statement, including its content and whether and how to communicate it,” he cannot be held liable under Rule 10-5(b) of the Securities Exchange Act. The rule forbids fraudulent schemes or devices, making false statements, and engaging in fraud that harms investors.
Justice Brett Kavanaugh, who sat on the circuit court panel at the time, dissented from its majority opinion, writing that Lorenzo hadn’t violated securities laws. “How could [petitioner] have intentionally deceived the clients when he did not draft the emails, did not think about the contents of the emails, and sent the emails only at his boss’s direction?”
Kavanaugh recused himself from the Supreme Court case, leaving the other eight justices to participate in oral arguments Dec. 3.
Justices Have Doubts
During those oral arguments, Lorenzo’s attorney, Robert Heim, said that sending the email was not an inherently deceptive act. Justice Neil Gorsuch appeared to agree that Lorenzo was not the author of the false statements in the emails.
But Justices Ruth Bader Ginsburg, Samuel Alito, and Sonia Sotomayor seemed to disagree with Heim.
Ginsburg asked Heim why it wasn’t “inherently deceptive to send a succession of untruths?”
“Lorenzo is essentially a conduit,” Heim replied. “He’s somebody that’s transmitting statements … on behalf of another … simply sending an e-mail is not enough to transform Frank Lorenzo into a primary violator from, perhaps, somebody who gave substantial assistance.
The language of the statutes and the rules make “a clear distinction between statements and … conduct.”
Alito asked why Lorenzo’s behavior wouldn’t “fall squarely” within the language of the rule used by the SEC.
Sotomayor was just as blunt, telling Heim: “I’m having a problem from the beginning. Once you concede … that you’re not challenging that your client acted with an intent to deceive or defraud, that you aren’t challenging the D.C. Circuit’s conclusion to that effect? Is that correct?”
Heim replied, “Yes, Your Honor.”
Sotomayor continued: “I don’t understand, once you concede that mental state, and he has the act of putting together the email and encouraging customers to call him with questions, not to call his boss with questions, how could that standing alone give away your case?
“That makes him both the maker of a false statement, but it’s also engaging in an act, practice, or course of conduct which operates or would operate as a fraud or deceit.”
The Trump administration argues the treatment Lorenzo received at the hands of the SEC was just.
“I don’t think you’re likely to see a … more egregious fraud than this,” Christopher Michel, assistant to the solicitor general, told the justices.
REVOLUTION STIRS IN AMERICA
“It will more likely come on the heels of economic dislocation and dwindling wealth to redistribute.”
"Between 2002 and 2015 annual earnings for the bottom 90 percent of Americans rose by only 4.5 percent, while earnings for the top 1 percent grew by 22.7 percent, according to the Economic Policy Institute. Under the Obama administration, more than 90 percent of income gains since the so-called “recovery” began have gone to the top one percent."
“Our entire crony capitalist system, Democrat and Republican alike, has become a kleptocracy approaching par with third-world hell-holes. This is the way a great country is raided by its elite.” ---- Karen McQuillan THEAMERICAN THINKER.com
"A defining expression of this crisis is the dominance of financial speculation and parasitism, to the point where a narrow international financial aristocracy plunders society’s resources in order to further enrich itself."
THE BILLIONAIRES’S GLOBALIST DEMOCRAT PARTY FOR WIDER OPEN BORDERS
THE TRUE COST OF ALL THAT “CHEAP” LABOR IS PASSED ALONG TO THE MIDDLE CLASS.
"This doesn't include the costs of illegal immigration to society, which provides health care, housing, education, child care, and legal services to illegal aliens. Even though immigration advocates claim that illegal aliens do indeed pay taxes, the dollar amount pales in comparison to the cost of the many services they receive."
Meanwhile, despite the highest taxes in the nation, California is $1.3 trillion in debt – unemployment is at a staggering 11%. California's wacko giveaways to illegals include in-state tuition, amounting to $25 million of financial aid. Nearly a million illegals have California driver's licenses. L.A. County has 144% more registered voters than there are residents of legal voting age. Clearly, illegals are illegally voting.
BEL AIR MAXINE WATERS AND HER CRACK ALLEY CONSTITUENTS
WALL STREET BANKSTERS AND THEIR BOUGHT DEMOCRAT POLS PREPARE FOR THE NEXT WAVE OF BOTTOMLESS NO-STRING BANKSTER BAILOUTS…
Will this one finish off the American economy?
Considering her record and documented history of poor ethical and moral fitness, it’s outrageous that Maxine Waters is up for chair of the ultra-powerful House Financial Services Committee, which has jurisdiction over the country’s banking system, economy, housing, and insurance.
"Wall Street billionaires are pushing a new plan to swipe the profits of Fannie Mae and Freddie Mac from U.S. taxpayers–and in the process revive the system of privatized-profits and public-risk that contributed to the severity of the Great Financial Crisis."
The Moelis plan stands out as a strikingly bold grab for control of the companies and their profits. It calls for the dividend payments to the Treasury to cease so that the companies can rebuild capital. Shockingly, it also calls for the cancellation of the senior preferred stock altogether–with no compensation for the past risk and future profits currently due to taxpayers. It is as if a company proposed to do a stock buyback by proposing to cancel its shares rather than purchasing them for cash.
So will Maxine Waters be the crusading financial protector of our 401k plans and save America from the next financial bubble? Well, there will certainly be lots of harassment and shakedowns. But don't count on her steering us clear of Wall Street excesses. If history is any guide, Mad Maxine will be way too busy raising money from the people she is now in charge of regulating. Stephen Moore is a senior fellow at The Heritage Foundation
Waters, who represents some of Los Angeles’ poorest inner-city neighborhoods, has also helped family members make more than $1 million through business ventures with companies and causes that she has helped, according to her hometown newspaper. While she and her relatives get richer (she lives in a $4.5 million Los Angeles mansion), her constituents get poorer. JUDICIAL WATCH
THE BANKSTERS’ RENT BOYS & GIRLS IN CONGRESS GATHER ROUND TO UNLEASH THE WHOLESALE LOOTING OF THEIR BANKSTER PAYMASTERS EVEN MORE….
After eight years of the Dodd-Frank bank “reform,” the American financial oligarchy exercises its dictatorship over society and the government more firmly than ever. This unaccountable elite will not tolerate even the most minimal limits on its ability to plunder the economy for its own personal gain.
“Democrats Move Towards
‘Oligarchical Socialism,’ Says
Forecaster Joel Kotkin.”
NO POL IN HISTORY SUCKED IN MORE BRIBES FROM BANKSTERS THAN BARACK OBAMA, AND HE DID IT BEFORE HIS FIRST DAY IN OFFICE. What did the Wall Street banksters know that took us so long to find out???
"One of the premier institutions of big business, JP Morgan Chase, issued an internal report on the eve of the 10th anniversary of the 2008 crash, which warned that another “great liquidity crisis” was possible, and that a government bailout on the scale of that effected by Bush and Obama will produce social unrest, “in light of the potential impact of central bank actions in driving inequality between asset owners and labor."
Obama, of course, covered up his own role, depicting his presidency as eight years of heroic efforts to repair the damage caused by the 2008 financial crash. At the end of those eight years, however, Wall Street and the financial oligarchy were fully recovered, enjoying record wealth, while working people were poorer than before, a widening social chasm that made possible the election of the billionaire con man and Demagogue in November 2016.
“The response of the administration was to rush to the defense of the banks. Even before coming to power, Obama expressed his unconditional support for the bailouts, which he subsequently expanded. He assembled an administration
dominated by the interests of finance capital, symbolized by economic adviser Lawrence Summers and Treasury Secretary Timothy Geithner.”
A decade after the 2008 financial crisis, the public is about evenly split on whether the U.S. economic system is more secure today than it was then. About half of Americans (48%) say the system is more secure today than it was before the 2008 crisis, while roughly as many (46%) say it is no more secure.
Opinions have changed since 2015 and 2013, when majorities said the economic system was no more secure than it had been prior to the crisis (63% in both years), according to the new survey, conducted Sept. 18-24 among 1,754 adults.
Republicans are now far more likely to view the system as more secure than they were during Barack Obama’s presidency. Three years ago, just 22% of Republicans and Republican-leaning independents said the economic system was more secure than before the crisis. Today, the share saying the same has increased 48 percentage points to 70%.
Views among Democrats and Democratic-leaning independents have moved in the opposite direction. Today, Democrats are less confident that the economy is more secure than it was before the 2008 financial crisis: Just a third say the economy is more secure – a drop of 13 percentage points from 2015 (46%).
Meanwhile, the public’s views of current economic conditions – and the trajectory of the U.S. economy over the next year – have changed little since March.
About half of Americans (51%) now rate the national economy as excellent or good, among the most positive measures in nearly two decades.
As has been the case since Donald Trump took office, Republicans are far more positive than Democrats about economic conditions: 73% of Republicans and Republican-leaning independents say economic conditions are excellent or good while just 35% of Democrats and Democratic leaners agree.
Partisans also are divided in their expectations for the economy. Republicans (57%) are much more likely than Democrats (12%) to say they expect the national economy to get better in the next year. Partisan differences in opinions about the economy – current and future – are about as wide as they were in March.
Similarly, there has been little recent change in Americans’ views of their own financial situations. About half (49%) say their finances are in excellent or good shape.
Partisan differences in people’s assessments of their personal finances, which were modest during most of Obama’s presidency, have increased since then.
A majority of Republicans (61%) say their personal financial situation is excellent or good, compared with about four-in-ten Democrats and Democratic leaners (41%).
Most Americans remain optimistic about their personal financial future. Almost seven-in-ten adults (68%) expect their financial situation to improve some or a lot over the next year.
Republicans (79%) more than Democrats (59%) are optimistic about their finances getting better next year.
Democratic Rep. Maxine Waters of California appears a lock to become the next chairman of the House's powerful Financial Services Committee. Waters is pledging to be a diligent watchdog for mom and pop investors, and recently told a crowd that when it comes to the big banks, investment houses and insurance companies, "We are going to do to them what they did to us." I'm not going to cry too many tears for Wall Street since they poured money behind the Democrats in these midterm elections. You get what you pay for.
But here we go again asking the fox to guard the henhouse.
Back during he the financial crisis of 2008 to 2009, which wiped out trillions of dollars of the wealth and retirement savings of middle-class families, we put the two major arsonists in charge of putting out the fire. Former Democratic Sen. Chris Dodd of Connecticut and former Democratic Rep. Barney Frank of Massachusetts were the co-sponsors of the infamous Dodd-Frank regulations. Readers will recall that good old Barney resisted every attempt to reign in Fannie Mae and Freddie Mac and said he wanted to "roll the dice" on the housing market. That worked out well.
Meanwhile, Dodd took graft payments in the form of low-interest loans from Countrywide, while greasing the skids for the housing lenders in these years. Instead of going to jail or at least being dishonorably discharged from Congress, he wrote the Dodd-Frank bill to regulate the banks.
Enter Maxine Waters. Back in 2009, I had a run-in with "Mad Maxine," as she is called on Capitol Hill. The two of us appeared together on HBO's "Real Time With Bill Maher," and when she pontificated about the misdeeds of the housing lobby, I confronted her on the money she took from Fannie Mae and Freddie Mac PACs for her campaign.
Here is how the conversation went:
MAHER: Don't you think Wall Street needs regulation? That's where the problem is: that there was no regulation.
MOORE: Well, let's talk about regulation. One of the biggest institutions that have failed this year was Fannie Mae and Freddie Mac. This is an institution that your friends, the Democrats, in fact, you, Congresswoman Waters, did not want to regulate. You said it wasn't broke five years ago at a congressional hearing, and you took $15,000 of campaign contributions from Fannie and Freddie.
WATERS: No, I didn't.
MOORE: Yeah, you did. It's in the FEC (Federal Election Commission) records.
WATERS: No, it's not.
MOORE: And so did Barney Frank. And so did Chris Dodd.
WATERS: That is a lie, and I challenge you to find $15,000 that I took from Fannie PAC.
I have to confess that Waters is very persuasive. I feared when the show was over that I had gotten my numbers wrong and that I had falsely charged the congresswoman of corruption. But several fact-checking groups looked it up, and sure enough, I was right. She took $15,000 from the PAC and another $17,000, all told.
I was also right about her statements during a 2004 congressional hearing when she said:
"Through nearly a dozen hearings, we were frankly trying to fix something (Fannie and Freddie) that wasn't broke. Chairman, we do not have a crisis at Freddie Mac, and particularly at Fannie Mae, under the outstanding leadership of Franklin Raines."
We learned the hard way just four years later; this was all a fraudulent claim to avoid oversight of her campaign contributors. Imagine if a Republican had said these things.
She took in more than $100,000 from Wall Street this year as well. None of this is illegal, but it calls into question her shakedown tactics. First, she threatens to put their head in a noose as chairman of the Financial Services Committee — as she is getting them to pony up campaign contributions. Pay to play? You decide.
Waters has had run-ins with the House Ethics Committee because of fundraising tactics and insider wheeling and dealing. Back during the financial crisis, she was suspected of helping arrange meetings with Treasury Department officials and getting bailout money for OneUnited, a troubled bank that her family owned major stock holdings in. She beat the rap of corruption, but it sure smelled bad.
So will Maxine Waters be the crusading financial protector of our 401k plans and save America from the next financial bubble? Well, there will certainly be lots of harassment and shakedowns. But don't count on her steering us clear of Wall Street excesses. If history is any guide, Mad Maxine will be way too busy raising money from the people she is now in charge of regulating.
Stephen Moore is a senior fellow at The Heritage Foundation and an economic consultant with FreedomWorks. He is the co-author of "Fueling Freedom: Exposing the Mad War on Energy."
WHY BANKS LOVE WAR AND THE WAR ECONOMY
The global banking system has historically played both sides of major conflicts through war financing, and drawing out the battles by providing funds beyond what each country could have otherwise spent.
Democratic Rep. Maxine Waters of California appears a lock to become the next chairman of the House's powerful Financial Services Committee. Waters is pledging to be a diligent watchdog for mom and pop investors, and recently told a crowd that when it comes to the big banks, investment houses and insurance companies, "We are going to do to them what they did to us." I'm not going to cry too many tears for Wall Street since they poured money behind the Democrats in these midterm elections. You get what you pay for.
But here we go again asking the fox to guard the henhouse.
Back during he the financial crisis of 2008 to 2009, which wiped out trillions of dollars of the wealth and retirement savings of middle-class families, we put the two major arsonists in charge of putting out the fire. Former Democratic Sen. Chris Dodd of Connecticut and former Democratic Rep. Barney Frank of Massachusetts were the co-sponsors of the infamous Dodd-Frank regulations. Readers will recall that good old Barney resisted every attempt to reign in Fannie Mae and Freddie Mac and said he wanted to "roll the dice" on the housing market. That worked out well.
Meanwhile, Dodd took graft
payments in the form of low-
interest loans from Countrywide,
while greasing the skids for the
housing lenders in these years.
Instead of going to jail or at least
being dishonorably discharged
from Congress, he wrote the Dodd-
Frank bill to regulate the banks.
Enter Maxine Waters. Back in
2009, I had a run-in with "Mad
Maxine," as she is called on Capitol
Hill. The two of us appeared
together on HBO's "Real Time With
Bill Maher," and when she
pontificated about the misdeeds of
the housing lobby, I confronted her
on the money she took from Fannie
Mae and Freddie Mac PACs for her
campaign.
Here is how the conversation went:
MAHER: Don't you think Wall Street needs regulation? That's where the problem is: that there was no regulation.
MOORE: Well, let's talk about regulation. One of the biggest institutions that have failed this year was Fannie Mae and Freddie Mac. This is an institution that your friends, the Democrats, in fact, you, Congresswoman Waters, did not want to regulate. You said it wasn't broke five years ago at a congressional hearing, and you took $15,000 of campaign contributions from Fannie and Freddie.
WATERS: No, I didn't.
MOORE: Yeah, you did. It's in the FEC (Federal Election Commission) records.
WATERS: No, it's not.
MOORE: And so did Barney Frank. And so did Chris Dodd.
WATERS: That is a lie, and I challenge you to find $15,000 that I took from Fannie PAC.
I have to confess that Waters is very persuasive. I feared when the show was over that I had gotten my numbers wrong and that I had falsely charged the congresswoman of corruption. But several fact-checking groups looked it up, and sure enough, I was right. She took $15,000 from the PAC and another $17,000, all told.
I was also right about her statements during a 2004 congressional hearing when she said:
"Through nearly a dozen hearings, we were frankly trying to fix something (Fannie and Freddie) that wasn't broke. Chairman, we do not have a crisis at Freddie Mac, and particularly at Fannie Mae, under the outstanding leadership of Franklin Raines."
We learned the hard way just four years later; this was all a fraudulent claim to avoid oversight of her campaign contributors. Imagine if a Republican had said these things.
She took in more than $100,000 from Wall Street this year as well. None of this is illegal, but it calls into question her shakedown tactics. First, she threatens to put their head in a noose as chairman of the Financial Services Committee — as she is getting them to pony up campaign contributions. Pay to play? You decide.
Waters has had run-ins with the House Ethics Committee because of fundraising tactics and insider wheeling and dealing. Back during the financial crisis, she was suspected of helping arrange meetings with Treasury Department officials and getting bailout money for OneUnited, a troubled bank that her family owned major stock holdings in. She beat the rap of corruption, but it sure smelled bad.
So will Maxine Waters be the crusading financial protector of our 401k plans and save America from the next financial bubble? Well, there will certainly be lots of harassment and shakedowns. But don't count on her steering us clear of Wall Street excesses. If history is any guide, Mad Maxine will be way too busy raising money from the people she is now in charge of regulating.
Stephen Moore is a senior fellow at The Heritage Foundation and an economic consultant with FreedomWorks. He is the co-author of "Fueling Freedom: Exposing the Mad War on Energy."
White House report on socialism
The specter of Marx haunts the American ruling class
6 November 2018
Last month, the Council of Economic Advisers, an agency of the Trump White House, released an extraordinary report titled “The Opportunity Costs of Socialism.” The report begins with the statement: “Coincident with the 200th anniversary of Karl Marx’s birth, socialism is making a comeback in American political discourse. Detailed policy proposals from self-declared socialists are gaining support in Congress and among much of the younger electorate.”
The very fact that the US government
officially acknowledges a growth of popular
support for socialism, particularly among the
nation’s youth, testifies to vast changes taking
place in the political consciousness of the
working class and the terror this is striking
within the ruling elite. America is, after all, a
country where anti-communism was for the
greater part of a century a state-sponsored
secular religion. No ruling class has so
ruthlessly sought to exclude socialist politics
from political discourse as the American ruling
class.
The 70-page document is itself an inane right-wing screed. It seeks to discredit socialism by identifying it with capitalist countries such as Venezuela that have expanded state ownership of parts of the economy while protecting private ownership of the banks, and, with the post-2008 collapse of oil and other commodity prices, increasingly attacked the living standards of the working class.
It identifies socialism with proposals for mild social reform such as “Medicare for all,” raised and increasingly abandoned by a section of the Democratic Party. It cites Milton Friedman and Margaret Thatcher to promote the virtues of “economic freedom,” i.e., the unrestrained operation of the capitalist market, and to denounce all social reforms, business regulations, tax increases or anything else that impinges on the oligarchy’s self-enrichment.
The report’s arguments and themes find expression in the fascistic campaign speeches of Donald Trump, who routinely and absurdly attacks the Democrats as socialists and accuses them of seeking to turn America into another “socialist” Venezuela.
What has prompted this effort to blackguard socialism?
A series of recent polls in the US and Europe have shown a sharp growth of popular disgust with capitalism and support for socialism. In May of 2017, in a survey conducted by the Union of European Broadcasters of people aged 18 to 35, more than half said they would participate in a “large-scale uprising.” Nine out of 10
agreed with the statement, “Banks and money rule the world.”
Last November, a poll conducted by YouGov showed that 51 percent of Americans between the ages of 21 and 29 would prefer to live in a socialist or communist country than in a capitalist country.
In August of this year, a Gallup poll found that for the first time since the organization began tracking the figure, fewer than half of Americans aged 18–29 had a positive view of capitalism, while more than half had a positive view of socialism. The percentage of young people viewing capitalism positively fell from 68 percent
in 2010 to 45 percent this year, a 23-
percentage point drop in just eight years.
This surge in interest in socialism is bound up with a resurgence of class struggle in the US and internationally. In the United States, the number of major strikes so far this year, 21, is triple the number in 2017. The ruling class was particularly terrified by the teachers’ walkouts earlier this year because the biggest strikes were organized by rank-and-file educators in a rebellion against the unions, reflecting the weakening grip of the pro-corporate organizations that have suppressed the class struggle for decades.
The growth of the class struggle is an objective process that is driven by the global crisis of capitalism, which finds its most acute social and political expression in the center of world capitalism—the United States. It is the class struggle that provides the key to the fight for genuine socialism.
Masses of workers and youth are being driven into struggle and politically radicalized by decades of uninterrupted war and the staggering growth of social inequality. This process has accelerated during the 10 years since the Wall Street crash of 2008. The Obama years saw the greatest transfer of wealth from the bottom to the top in history, the escalation of the wars begun under Bush and their spread to Libya, Syria and Yemen, and the intensification of mass surveillance, attacks on immigrants and other police state measures.
This paved the way for the elevation of Trump, the personification of the criminality and backwardness of the ruling oligarchy.
Under conditions where the typical CEO in the US now makes in a single day almost as much as the average worker makes in an entire year, and the net worth of the 400 wealthiest Americans has doubled over the past decade, the working class is looking for a radical alternative to the status quo. As the Socialist Equality Party wrote in its program eight years ago, “The Breakdown of Capitalism and the Fight for Socialism in the United States”:
The change in objective conditions, however, will lead American workers to change their minds. The reality of capitalism will provide workers with many reasons to fight for a fundamental and revolutionary change in the economic organization of society.
The response of the ruling class is two-fold. First, the abandonment of bourgeois democratic forms of rule and the turn toward dictatorship. The run-up to the midterm elections has revealed the advanced stage of these preparations, with Trump’s fascistic attacks on immigrants, deployment of troops to the border, threats to gun down unarmed men, women and children seeking asylum, and his pledge to overturn the 14th Amendment establishing birthright citizenship.
That this has evoked no serious opposition from the Democrats and the media makes clear that the entire ruling class is united around a turn to authoritarianism. Indeed, the Democrats are spearheading the drive to censor the internet in order to silence left-wing and socialist opposition.
The second response is to promote phony socialists such as Bernie Sanders, the Democratic Socialists of America (DSA) and other pseudo-left organizations in order to confuse the working class and channel its opposition back behind the Democratic Party.
In 2018, with Sanders totally integrated into the Democratic Party leadership, this role has been largely delegated to the DSA, which functions as an arm of the Democrats. Two DSA members, Alexandria Ocasio-Cortez in New York and Rashida Tlaib in Detroit, are likely to win seats in the House of Representatives as candidates of the Democratic Party.
The closer they come to taking office, the more they seek to distance themselves from their supposed socialist affiliation. Ocasio-Cortez, for example, joined Sanders in eulogizing the recently deceased war-monger John McCain, refused to answer when asked if she opposed the US wars in the Middle East, and dropped her campaign call for the abolition of Immigration and Customs Enforcement (ICE).
OBAMA: SERVANT OF THE 1%
Richest one percent controls nearly half of global wealth
The richest one percent of the world’s population now controls 48.2 percent of global wealth, up from 46 percent last year.
The Clinton White House famously abolished the Glass–Steagall legislation, which separated commercial and investment banking. The move was a boon for Wall Street firms and led to major bank mergers that some analysts say helped contribute to the 2008 financial crisis.
Bill and Hillary Clinton raked in massive speaking fees from Goldman Sachs, with CNN documenting a total of at least $7.7 million in paid speeches to big financial firms, including Goldman Sachs and UBS. Hillary Clinton made $675,000 from speeches to Goldman Sachs specifically, and her husband secured more than $1,550,000 from Goldman speeches. In 2005 alone, Bill Clinton collected over $500,000 from three Goldman Sachs events.
Hillary Clinton is simply the epitome of the rabid self – a whirlpool of selfishness, greed, and malignance.
It may well be true that Donald Trump has made his greatest contribution to the nation before even taking office: the political destruction of Hillary Clinton and her infinitely corrupt machine. J.R. Dunn
"Hillary will do anything to distract you from her reckless record and the damage to the Democratic Party and the America she and The Obama's have created."
Their Looting of the Poor of Haiti IS FINALLY OVER
“The couple parlayed lives supposedly spent in “public service” into admission into the upper stratosphere of American wealth, with incomes in the top 0.1 percent bracket. The source of this vast wealth was a political machine that might well be dubbed “Clinton, Inc.” This consists essentially of a seedy money-laundering operation to ensure big business support for the Clintons’ political ambitions as well as their personal fortunes. The basic components of the operation are lavishly paid speeches to Wall Street and Fortune 500 audiences, corporate campaign contributions, and donations to the ostensibly philanthropic Clinton Foundation.”
IT WAS BILL CLINTON WHO UNLEASHED WALL STREET’S BIGGEST CRIMINAL BANKSTERS…. And haven’t they sucked up the banksters’ gratuities since?
“Clinton also failed to mention how he and Hillary cashed in after his presidential tenure to make themselves multimillionaires, in part by taking tens of millions in speaking fees from Wall Street bankers.”
TRY TO SEPARATE THE CLINTON MAFIA AND DONALD TRUMP’S CRIMES FROM THEIR BANKSTER PAYMASTERS AT GOLDMAN SACHS!
Can’t be done!
NEW YORK — In the midst of a public relations nightmare, former White House Deputy National Security Adviser Dina Habib Powell took charge of Goldman Sachs’s global charitable foundation, helping to resurrect the big bank’s shattered image after it was implicated in practices that contributed to the financial crisis of 2007-2008.
“Clinton also failed to mention how he and Hillary cashed in after his presidential tenure to make themselves multimillionaires, in part by taking tens of millions in speaking fees from Wall Street bankers.”
Obama Is Making You Poorer—But Who’s Getting Rich?
Goldman Sachs, GE, Pfizer, the United Auto Workers—the same “special interests” Barack Obama was supposed to chase from the temple—are profiting handsomely from Obama’s Big Government policies that crush taxpayers, small businesses, and consumers. In Obamanomics, investigative reporter Timothy P. Carney digs up the dirt the mainstream media ignores, and the White House wishes you wouldn’t see. Rather than Hope and Change, Obama is delivering corporate socialism to America, all while claiming he’s battling corporate America. It’s corporate welfare and regulatory robbery—it’s OBAMANOMICS TO SERVE THE RICH AND GLOBALIST BILLIONAIRES.
OBAMA-CLINTONOMICS: You were wondering how many jobs went to illegals and how well Obama’s crony banksters have done???
The sputtering economic recovering under President Obama, the last to follow a major recession, has fallen way short of the average recovery and ranks as the worst since the 1930s Great Depression, according to a new report.
Had the recovery under Obama been the average of the 11 since the Depression, according to the report, family incomes would be $17,000 higher, six million fewer Americans would be in poverty, and there would be six million more jobs.
This manufactured crisis has, in turn, been exploited by the Obama administration and both big business parties to hand over trillions in pension funds and other public assets to the financial kleptocracy that rules America.
“Our entire crony capitalist system, Democrat and Republican alike, has become a kleptocracy approaching par with third-world hell-holes. This is the way a great country is raided by its elite.” ---- Karen McQuillan THEAMERICAN THINKER.com
“This was not because of difficulties in securing indictments or convictions. On the contrary, Attorney General Eric Holder told a Senate committee in March of 2013 that the Obama administration chose not to prosecute the big banks or their CEOs because to do so might “have a negative impact on the national economy.”
“Attorney General Eric Holder's tenure was a low point even within the disgraceful scandal-ridden Obama years.” DANIEL GREENFIELD / FRONTPAGE MAG
Whenever any of its bonds reaches maturity, the Fed simply removes it from its balance sheet, and the money paid at maturation by the Treasury Department is extinguished. The Fed makes those dollars go out of existence. So far billions of dollars have been taken out of the economy, at a pace of $600 billion a year.
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