The administration’s ban on US relations with the Chinese telecom giant Huawei followed by last week’s surprise announcement of tariffs on Mexican goods increased the anxiety in ruling class circles, leading to warnings from both Morgan Stanley and JPMorgan Chase of a recession within the coming year.
"The Federal Reserve is a key mechanism for
perpetuating this whole filthy system, in
which "Wall Street rules."
"But this means only that when the correction does come, as it inevitably must, it will be all the more severe and the Fed will have all the less power to stop it."
This was an expected, but nevertheless welcome, signal to the American financial elite, which has enjoyed a spectacular rise in corporate profits, stock values and personal wealth since 2009 thanks to the flood of virtually free money provided by the Fed.
the depression is already here for most of us below the super-rich!
Trump and the GOP created a fake economic boom on our collective credit card: The equivalent of maxing out your credit cards and saying look how good I'm doing right now.
Trump criticized Dimon in 2013 for supposedly contributing to the country’s economic downturn. “I’m not Jamie Dimon, of JP Morgan, who pays $13 billion to settle a case and then pays $11 billion to settle a case and who I think is the worst banker in the United States,” he told reporters.
"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."
"Overall, the reaction to the decision points to the underlying fragility of financial markets, which have become a house of cards as a result of the massive inflows of money from the Fed and other central banks, and are now extremely susceptible to even a small tightening in financial conditions."
"It is significant that what the Financial Times described as a “tsunami of money”—estimated to reach $1 trillion for the year—has failed to prevent what could be the worst year for stock markets since the global financial crisis."
"A decade ago, as the financial crisis raged, America’s banks were in ruins. Lehman Brothers, the storied 158-year-old investment house, collapsed into bankruptcy in mid-September 2008. Six months earlier, Bear Stearns, its competitor, had required a government-engineered rescue to avert the same outcome. By October, two of the nation’s largest commercial banks, Citigroup and Bank of America, needed their own government-tailored bailouts to escape failure. Smaller but still-sizable banks, such as Washington Mutual and IndyMac, died."
The GOP said the "Tax Cuts and Jobs Act"
would reduce deficits and supercharge the
economy (and stocks and wages). The
White House says things are working as
planned, but one year on--the numbers
mostly suggest otherwise.
would reduce deficits and supercharge the
economy (and stocks and wages). The
White House says things are working as
planned, but one year on--the numbers
mostly suggest otherwise.
US stocks surge as Fed signals rate cut
US stock prices shot up Tuesday, reversing weeks of declines, after Federal Reserve Chairman Jerome Powell signaled that he was prepared to slash interest rates to keep the longest bull market in American history from coming to an end.
Amid mounting concerns in corporate circles
of a looming recession and new financial
crisis triggered by the Trump administration’s
trade war measures against China, Mexico
and other countries, Powell began his
remarks at a monetary policy conference in
Chicago with an assurance that all of the
resources of the state would be made
available to protect the fortunes of the
financial oligarchy.
Jerome Powell [Credit: C-Span]
Speaking of “recent developments involving trade negotiations and other matters,” he told the assembled economists and bankers: “We do not know how or when these issues will be resolved. We are closely monitoring the implications of these developments for the US economic outlook and, as always, we will act as appropriate to sustain the expansion, with a strong labor market and inflation near our symmetric 2 percent objective.”
US stock prices were already rising when Powell made his remarks, having been boosted by a speech the previous day by St. Louis Federal Reserve President James Bullard, who told the conference that an interest rate cut “would be warranted soon.” But Powell’s intervention turned the upward trend into a euphoric celebration of buying, adding 512 points to the Dow at the close, a spurt of more than 2 percent. The S&P 500 index added 58 points, or 2.14 percent, and the Nasdaq shot up 194 points, or 2.65 percent.
European markets also rose sharply on the news of Powell’s remarks.
Powell’s statement was a response to increasing pressure from Wall Street for a new round of rate cuts, including directives by Donald Trump, the representative of the financial aristocracy in the White House. Trump recently called on Powell to slash rates, arguing that it would strengthen the hand of the US in the intensifying trade war with China.
Trump’s extension of 25 percent tariffs to a much wider range of Chinese exports early last month has begun to take its toll on both the US and Chinese economies, fueling a substantial slowdown in manufacturing growth in the US and stagnation in China, at the same time that factory output is falling in Germany and other European countries.
The response of the corporate ruling elites all over the world has been to launch a new round of mass layoffs and restructuring in basic industries such as auto, placing the burden of the rise of economic nationalism and tariff wars squarely on the working class. Neither the Fed nor any section of the US political establishment, Democrats as well as Republicans, has lifted a finger to protect the jobs and livelihoods of workers, but when it comes to protecting the wealth of the richest 10 percent, 1 percent and 0.1 percent, there is no limit to the billions pumped into the stock market.
The administration’s ban on US relations with the Chinese telecom giant Huawei followed by last week’s surprise announcement of tariffs on Mexican goods increased the anxiety in ruling class circles, leading to warnings from both Morgan Stanley and JPMorgan Chase of a recession within the coming year.
These fears are above all driven by the growth of the class struggle and the turn by ever wider layers of workers and youth to socialism as an alternative to capitalist war and inequality.
The major stock indexes in the US fell 6 percent in May, and the broadest index of large American companies, the S&P 500, fell nearly 7 percent from its record high on April 30. The fears on Wall Street were also reflected in the downward trend of the yield on 10-year Treasury bonds, which fell to just above 2 percent. This was the result of a flight to safety away from stocks into what is deemed the most secure investment. This in turn led to the anomaly of interest rates on longer-term US government bonds being lower than those on short-term bonds—a phenomenon known as an interest rate inversion, seen as a sign of impending recession.
At the last meeting of the Fed’s policy-making body, the Federal Open Market Committee, held April 30–May 1, the US central bank held its benchmark federal funds rate steady at 2.25–2.50 percent. Minutes of the meeting released later in May revealed a consensus among Fed officials to exercise “patience” in raising or lowering rates “for some time.”
Nevertheless, the markets were predicting at least two cuts in rates before the end of the year. The demands of Wall Street were stated unequivocally in an op-ed piece posted Monday night by the Wall Street Journal, which began, “It’s time for the Federal Reserve to cut interest rates.”
The markets surged Tuesday despite Trump’s declaration during his press conference with British Prime Minister Theresa May in London that he fully intended to impose tariffs on Mexico this coming Monday. This underscores the fact that it was Powell’s guarantee of central bank action to prop up the markets that triggered the rally.
The Fed chair’s about-face reprises his performance last January, when he caved in to demands from Trump and Wall Street for an end to his policy of incremental rate increases and a return to monetary policy “normalcy,” declaring that he was “listening” to the financial markets and indicating that he would hold off on scheduled rate increases. This came after US markets suffered their worst December since the Great Depression, amid signs of a manufacturing slowdown in both the US and China and mounting fears of a recession.
Powell’s remarks exposed the reality behind the Fed’s pose of political and class neutrality and single-minded focus on the interests of the “American people.” Just as previous Fed chairs for the past 40 years have openly acted as agents of the corporate-financial elite in boosting the stock market as the instrument for redistributing wealth from the bottom to the top of society—from the “Greenspan put” of the late 1980s and 1990s to the Bernanke “put” following the 2008 financial meltdown—the current chairman is executing the “Powell put” to underwrite the staggering rise in asset values.
The inevitable result, however, is a crisis even greater than the collapse of the dot.com bubble in 1999–2000 and the implosion of the sub-prime mortgage Ponzi scheme eight years later, as the ruling class compounds the underlying crisis and contradictions of its system by seeking to paper them over with unprecedented levels of debt.
$2,198,468,000,000: Federal Spending
Hit 10-Year High Through March; Taxes
Hit 5-Year Low
(CNSNews.com) - The federal government spent $2,198,468,000,000
in the first six months of fiscal 2019 (October through March), which is the
most it has spent in the first six months of any fiscal year in the last
decade, according
to the Monthly Treasury Statements.
The last time the government spent more in the
October-through-March period was in fiscal 2009, when it spent
$2,326,360,180,000 in constant March 2019 dollars.
Fiscal 2009 was the fiscal year that
began with President George W. Bush
signing a $700-billion law to bailout the
banking industry in October 2008 and
then saw President Barack Obama sign
a $787-billion stimulus law in February
2009.
began with President George W. Bush
signing a $700-billion law to bailout the
banking industry in October 2008 and
then saw President Barack Obama sign
a $787-billion stimulus law in February
2009.
At the same time that the Treasury was spending the most it has
spent in ten years, it was also taking in less in tax revenue than it has in
the past five years.
In the October-through-March period, the Treasury collected
$1,507,293,000,000 in total taxes. The last time it collected less than that in
the first six months of any fiscal year was fiscal 2014, when it collected
$1,420,897,880,000 in constant March 2019 dollars.
The difference in the federal taxes taken in and the spending
going out resulted in a federal deficit of $691,174,000,000 for the first six
months of the fiscal year.
During those six months, the Department of Health and Human
Services spent the most money of any federal agency with outlays of $583.491
billion. The Social Security Administration was second, spending $540.426
billion. The Department of Defense was third, spending $325.518 billion.
Interest on Treasury securities was third, coming in at $259.687 for the
six-month period.
Both individual and corporation income taxes were down in the
first six months of this fiscal year compared to last year. In the first six
months of fiscal 2018, the Treasury collected $736,274,000,000 in individual
income taxes (in constant March 2019 dollars). In the first six months of this
fiscal year, it collected $723,828,000,000.
In the first six months of fiscal 2018, the Treasury collected
$80,071,070,000 in corporation income taxes (in constant March 2019 dollars).
In the first six months of this fiscal year, it collected $67,987,000,000.
(Historical budget numbers in this story were adjusted to March
2019 dollars using the Bureau of Labor Statistics inflation calculator.)
(Table 3 from the Monthly
Treasury Statement, seen below,
summarizing federal receipts and outlaws for the past month and for the fiscal
year to date and compares it to the previous fiscal year.)
After Lehman's Collapse: A Decade of
Delay
Now that the 2018
midterms are over, folks can address the elephant in the room. If one tuned
into Fox Business midday on January 7, one heard legendary corporate raider
Carl Icahn dilate on the dimensions of the pachyderm, which he pegged at $250
trillion. That’s the size of worldwide debt. But can that be right -- it’s
more than eleven times the official U.S. federal government’s debt? And in case
you didn’t notice, it is a quarter of one quadrillion bucks. Pretty soon we’ll
be talking real money.
Icahn’s $250T quotation
for worldwide debt came out last year. On September 13, Bloomberg ran “$250 Trillion in Debt: the World’s
Post-Lehman Legacy” by Brian Chappatta, who draws off data from the Institute of International Finance’s July 9 “Global Debt
Monitor,” (to read IIF reports, one must sign up). Chappatta wonders how the
world’s central bankers can “even pretend to know how to reverse what they’ve
done over the past decade”:
[Central banks] kept
interest rates at or below zero for an extended period […] and used bond-buying
programs to further suppress sovereign yields, punishing savers and promoting
consumption and risk-taking. Global debt has ballooned over the past two
decades: from $84 trillion at the turn of the century, to $173 trillion at the
time of the 2008 financial crisis, to $250 trillion a decade after Lehman
Brothers Holdings Inc.’s collapse.
Chappatta breaks global
debt down into four categories: financial corporations, nonfinancial
corporations, households, and governments. In every category, global nominal
debt rose from 2008 to 2018, with the debt of governments hitting $67T. In the
important debt-as-a-percentage-of-gross-domestic-product measurement, three of
the categories rose while only financial corporations fell, “leaving their
debt-to-GDP ratio as low as it has been in recent memory.” Global banks seem to
be “healthier and more resilient to another shock.” After reporting on
worldwide debt, Chappatta then looks at U.S. debt.
What’s interesting about
debt in America is that as a percentage of GDP, households and financial
corporations have sharply reduced their debt. It is only government in America
that has seen a sharp debt-to-GDP uptick, and it was quoted at more than 100
percent of GDP. That’s rather higher than for all government debt worldwide.
Since the U.S. isn’t the
only nation that has been busy buying bonds and creating money, one might
wonder just how much money there is in the world. In June of 2017,HowMuch put out
“Putting the World’s Money into
Perspective,” which is a nice little graphic that puts the category “All
Money” at $83.6T.
In November of
2017, MarketWatch ran
“Here’s all the money in the world, in
one chart”
by Sue Chang, who in her short intro to the chart has some interesting things
to say about global money, including cryptocurrencies. She writes of “narrow
money” and “broad money” and pegs the latter at
$90.4T, (or what Sen. Everett Dirksen would call “real money”.) If you want to
examine Chang’s chart more closely, I’ve “excised” it here for your
convenience; don’t miss the notes on the right margin. (Because its depth is
13,895 pixels, you might want to just save the chart to your computer rather
than print it off.)
So, in addition to an
historic run-up in debt, there’s been a monster amount of new money created.
Chappatta calls it the “grandest central-bank experiment in history.” His use
of “experiment” is apropos, as one wonders whether the world’s central bankers
and their economists really know what they’ve been doing.
One ray of hope might
just be President Trump’s choice of Jerome Powell as Chairman of the Federal
Reserve, (Trump has such good instincts about people). One can get a sense of
the man from his January talk with David Rubenstein at the Economic Club of
Washington, D.C. (video and transcript). It’s refreshing that
Mr. Powell disdains the “Fed speak” used by his predecessors.
Chappatta’s article is
quite worth reading, and it’s not very long. The charts are user-friendly,
although animated ones are a bit “creative.” The last section, “China Charges
Forward,” is especially worthwhile.
This is the post-Lehman
legacy. To pull the global economy back from the brink, governments borrowed
heavily from the future. That either portends pain ahead, through austerity
measures or tax increases, or it signals that central-bank meddling will become
a permanent fixture of 21st century financial markets.
Given those
alternatives, let’s try a little austerity. But austerity would entail spending
cuts, and Congress has a poor history in that regard. In fact, since fiscal 2007,
the year before the financial crisis, total federal spending has gone from
$2.72T a year to more than $4T. While austere citizens deleverage and get their
fiscal affairs in order, Congress shamefully borrows and spends like never
before.
Congress’ solutions are
to bail out, prop up, and do whatever it takes to avoid reforming what it has
created. So they farm out their responsibilities to the Federal Reserve.
Indeed, in the July 17, 2012 meeting of the Senate Banking Committee (go
to the 53:50 point of this C-SPAN video), Chuck Schumer told
Federal Reserve Chairman Ben Bernanke the following:
So given the political
realities, Mr. Chairman, particularly in this election year, I'm afraid the Fed
is the only game in town. And I would urge you to take whatever actions you
think would be most helpful in supporting a stronger economic recovery… So get
to work, Mr. Chairman. (Chuckles.)
So the Fed is “the only
game in town” because there are only monetary solutions for the economy, right?
There aren’t any fiscal solutions, as they would involve Congress, and Congress
is busy running for re-election, right? Sounds like you’re abdicating your
responsibilities, Chuck.
The
last decade has been an exercise in delay. Congress has avoided doing the
difficult and unpopular things that would help avoid future financial
collapses. If Congress were serious about balancing the budget, then social
programs would be on the chopping block, because that’s where the real money goes.
"The Federal Reserve is a key mechanism for
perpetuating this whole filthy system, in
which "Wall Street rules."
Wall Street rules
The Federal Reserve sent a clear message to Wall Street on
Friday: It will not allow the longest bull market in American history to end.
The message was received loud and clear, and the Dow rose by more than 700
points.
Hundreds of thousands of federal workers remain furloughed or
forced to work without pay as the partial government shutdown enters its third
week, but the US central bank is making clear that all of the resources of the
state are at the disposal of the financial oligarchy.
Responding to Thursday’s market selloff following a dismal
report from Apple and signs of a manufacturing slowdown in both China and the
US, the Fed declared it was “listening” to the markets and would scrap its
plans to raise interest rates.
Speaking at a conference in Atlanta, where he was flanked by his
predecessors Ben Bernanke and Janet Yellen, both of whom had worked to reflate
the stock market bubble after the 2008 financial crash, Chairman Jerome Powell
signaled that the Fed would back off from its two projected rate increases for
2019.
“We’re listening sensitively to the messages markets are
sending,” he said, adding that the central bank would be “patient” in imposing
further rate increases. To underline the point, he declared, “If we ever came
to the conclusion that any aspect of our plans” was causing a problem, “we
wouldn’t hesitate to change it.”
This extraordinary pledge to Wall Street followed the 660 point
plunge in the Dow Jones Industrial Average on Thursday, capping off the worst
two-day start for a new trading year since the collapse of the dot.com bubble.
William McChesney Martin, the Fed chairman from 1951 to 1970,
famously said that his job was “to take away the punch bowl just as the party
gets going.” Now the task of the Fed chairman is to ply the wealthy revelers
with tequila shots as soon as they start to sober up.
Powell’s remarks were particularly striking given that they
followed the release Friday of the most upbeat jobs report in over a year, with
figures, including the highest year-on-year wage growth since the 2008 crisis,
universally lauded as “stellar.”
While US financial markets have endured the
worst December since the Great Depression,
amid mounting fears of a looming recession
and a new financial crisis, analysts have been
quick to point out that there are no “hard”
signs of a recession in the United States.
Both the Dow and the S&P 500 indexes have fallen more than
15 percent from their recent highs, while the tech-heavy NASDAQ has entered
bear market territory, usually defined as a drop of 20 percent from recent
highs.
The markets, Powell admitted, are “well ahead of the data.” But
it is the markets, not the “data,” that Powell is listening to.
Since World War II, bear markets have occurred, on average,
every five-and-a-half years. But if the present trend continues, the Dow will
reach 10 years without a bear market in March, despite the recent losses.
Now the Fed has stepped in effectively to pledge that it
will
allocate whatever resources are needed to ensure that no
substantial market correction takes place. But this
means only that when the correction does come, as it inevitably must, it will be all the more severe and the Fed will have all the less power to stop it.
From the standpoint of the history of the institution, the Fed’s
current more or less explicit role as backstop for the stock market is a
relatively new development. Founded in 1913, the Federal Reserve legally has
had the “dual mandate” of ensuring both maximum employment and price stability
since the late 1970s. Fed officials have traditionally denied being influenced
in policy decisions by a desire to drive up the stock market.
Federal Reserve Chairman Paul Volcker, appointed by Democratic
President Jimmy Carter in 1979, deliberately engineered an economic recession
by driving the benchmark federal funds interest rate above 20 percent. His
highly conscious aim, in the name of combating inflation, was to quash a wages
movement of US workers by triggering plant closures and driving up
unemployment.
The actions of the Fed under Volcker set the stage for a vast
upward redistribution of wealth, facilitated on one hand by the trade unions’
suppression of the class struggle and on the other by a relentless and dizzying
rise on the stock market.
Volcker’s recession, together with the Reagan administration’s
crushing of the 1981 PATCO air traffic controllers’ strike, ushered in decades
of mass layoffs, deindustrialization and wage and benefit concessions, leading
labor’s share of total national income to fall year after year.
These were also decades of financial deregulation, leading to
the savings and loan crisis of the late 1980s, the dot.com bubble of 1999-2000,
and, worst of all, the 2008 financial crisis.
In each of these crises, the Federal Reserve carried out what
became known as the “Greenspan put,” (later the “Bernanke put”)—an implicit
guarantee to backstop the financial markets, prompting investors to take ever
greater risks.
Since that time, the
Federal Reserve has carried out its most accommodative monetary policy ever,
keeping interest rates at or near zero percent for six years. It supplemented
this boondoggle for the financial elite with its multi-trillion-dollar
“quantitative easing” money-printing program.
The effect can be seen
in the ever more staggering wealth of the financial oligarchy, which has
consistently enjoyed investment returns of between 10 and 20 percent every year
since the financial crisis, even as the incomes of workers have stagnated or
fallen.
American capitalist society is hooked on the toxic growth of
social inequality created by the stock market bubble. This, in turn, fosters
the political framework not just for the decadent lifestyles of the financial
oligarchs, each of whom owns, on average, a half-dozen mansions around the
world, a private jet and a super-yacht, but also for the broader periphery of
the affluent upper-middle class, which provides the oligarchs with political
legitimacy and support. These elite social layers determine American political
life, from which the broad mass of working people is effectively excluded.
The Federal Reserve is a key mechanism for
perpetuating this whole filthy system, in
which “Wall Street rules.” But its services in behalf
of
the rich and the super-rich only compound the fundamental
and
insoluble contradictions of capitalism, plunging the system
into
ever deeper debt and ensuring that the next crisis will be
that
much more violent and explosive.
In this intensifying crisis, the working class
must assert its independent interests with the
same determination and ruthlessness as evinced
by the ruling class. It must answer the
bourgeoisie’s social counterrevolution with the
program of socialist revolution.
must assert its independent interests with the
same determination and ruthlessness as evinced
by the ruling class. It must answer the
bourgeoisie’s social counterrevolution with the
program of socialist revolution.
"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."
“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
STRIKES ALL OVER AMERICA, THOUSANDS OF RETAIL STORES CLOSING, CAR SALES SLUMP, REAL ESTATE IN THE DOLDRUMS… That is the real “recover”… It only happened for the rich!
Despite a booming economy, many U.S. households are still just holding on
https://www.latimes.com/business/la-fi-federal-reserve-household-survey-20190523-story.html
By MATTHEW BOESLER
Many U.S. households find themselves in a fragile position financially, even in an economy with an unemployment rate near a 50-year low. (David Sacks / Getty Images)
For the American ruling elite, life has
The father of US Treasury Secretary Steven Mnuchin just completed the most expensive purchase of a living artist’s work in US history, spending over $91 million on a three-foot-tall metallic sculpture. Ken Griffin, the founder of hedge fund Citadel, recently dropped $238 million on a penthouse in New York City, the most expensive US home ever purchased. And Amazon’s Jeff Bezos, the world’s richest man, has invested $42 million in a 10,000-year clock.
The stock market is booming, and President Donald Trump is boasting at every turn that the unemployment rate is lower than it has been in five decades.
Education
More millennials have a college degree than any other generation of young adults. In 2013, 47 percent of 25- to 34-year-olds received a postsecondary degree. For most, however, getting a college education has not led to a significant increase in quality of living.
Graph from the Economic Policy Institute
Decades of decaying capitalism have led to this accelerating divide. While the rich accumulate wealth with no restriction, workers’ wages and benefits have been under increasing attack. In 1979, 90 percent of the population took in 70 percent of the nation’s income. But, by 2017, that fell to only 61 percent.
"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
“Behind the ostensible government sits enthroned an invisible government owing no allegiance and acknowledging no responsibility to the people. To destroy this invisible government, to befoul the unholy alliance between corrupt business and corrupt politics is the first task of the statesmanship of today.” THEODORE ROOSEVELT
"But what the Clintons do is criminal because they do it wholly at the expense of the American people. And they feel thoroughly entitled to do it: gain power, use it to enrich themselves and their friends. They are amoral, immoral, and venal. Hillary has no core beliefs beyond power and money. That should be clear to every person on the planet by now." ---- Patricia McCarthy - AMERICANTHINKER.com
“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."
In 2014 the Russell Sage Foundation found that between
Between 2009 and 2012, 95 percent of all the income gains in the US went to the top 1 percent. This is the most distorted post-recession income gain on record.
Watch–Josh Hawley Rips ‘Aristocratic Elite’ for Engineering U.S. Economy Against American Middle Class
Sen. Josh Hawley (R-MO) ripped what he called the country’s “new aristocratic elite” for engineering the United States economy against the American middle class.
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."
For his first major speech on the Senate floor, Hawley slammed the “big banks, big tech, big multi-national corporations, along with their allies in the academy and the media,” whom he said have created an economic structure in which they, the well-connected, benefit while the American working and middle class increasingly struggle to get ahead.
Recent research revealed that while coastal, elite metropolis cities have flourished in the last decade, small town and rural American communities have suffered depopulation, mass job loss, and continued economic strain since the Great Recession.
Billionaire Class Enjoys 15X the Wage Growth
of American Working Class
The billionaire class — the country’s top 0.01 percent of earners — have enjoyed more than 15 times as much wage growth as America’s working and middle class since 1979, new wage data reveals.
Recent research revealed that while coastal, elite metropolis cities have flourished in the last decade, small town and rural American communities have suffered depopulation, mass job loss, and continued economic strain since the Great Recession.
of American Working Class
The billionaire class — the country’s top 0.01 percent of earners — have enjoyed more than 15 times as much wage growth as America’s working and middle class since 1979, new wage data reveals.
Between 1979 and 2017, the wages of the bottom 90 percent — the country’s working and lower middle class — have grown by only about 22 percent, Economic Policy Institute (EPI) researchers find.
Study: Elite Zip Codes Thrived in Obama Recovery, Rural America Left Behind
Wealthy cities and elite zip codes thrived under the slow-moving economic recovery of President Obama while rural American communities were left behind, a study reveals.
The Economic Innovation Group research, highlighted by Axios, details the massive economic inequality between the country’s coastal city elites and middle America’s working class between the Great Recession in 2007 and Obama’s economic recovery in 2016.
Record high income in 2017 for top one percent of wage earners in US
In 2017, the top one percent of US wage earners received their highest paychecks ever, according to a report by the Economic Policy Institute (EPI).
THE STAGGERING ECONOMIC INEQUALITY UNDER OBAMA'S ADMINISTRATION SERVING THE BILLIONAIRE CLASS.
THE ENTIRE REASON BEHIND AMNESTY IS TO KEEP WAGES DEPRESSED AND PASS ALONG THE REAL COST OF "CHEAP" MEXICAN LABOR TO THE AMERICAN MIDDLE CLASS.
AND IT'S WORKING!
SEN. BERNIE SANDERS
“Calling income and wealth inequality the "great moral issue of our time," Sanders laid out a sweeping, almost unimaginably expensive program to transfer wealth from the richest Americans to the poor and middle class. A $1 trillion public works program to create "13 million good-paying jobs." A $15-an-hour federal minimum wage. "Pay equity" for women. Paid sick leave and vacation for everyone. Higher taxes on the wealthy. Free tuition at all public colleges and universities. A Medicare-for-all single-payer health care system. Expanded Social Security benefits. Universal pre-K.” WASHINGTON EXAMINER
YOU THOUGHT OBAMA INVITED OBAMANOMICS and started the assault on the American middle-class?
“By the time of Bill Clinton’s election in 1992, the Democratic Party had completely repudiated its association with the reforms of the New Deal and Great Society periods. Clinton gutted welfare programs to provide an ample supply of cheap labor for the rich (WHICH NOW MEANS OPEN BORDERS AND NO E-VERIFY!), including a growing layer of black capitalists, and passed the 1994 Federal Crime Bill, with its notorious “three strikes” provision that has helped create the largest prison population in the world.”
Clinton Foundation Put On Watch List Of Suspicious ‘Charities’
ttp://mexicanoccupation.blogspot.com/2015/04/charity-navigator-clinton-foundation.htmlMillionaires projected to own 46 percent of global private wealth by 2019
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.
Millionaires projected to own 46 percent of global private wealth by 2019
By Gabriel Black
Households with more than a million (US) dollars in private wealth are projected to own 46 percent of global private wealth in 2019 according to a new report by the Boston Consulting Group (BCG).
This large percentage, however, only includes cash, savings, money market funds and listed securities held through managed investments—collectively known as “private wealth.” It leaves out businesses, residences and luxury goods, which comprise a substantial portion of the rich’s net worth.
At the end of 2014, millionaire households owned about 41 percent of global private wealth, according to BCG. This means that collectively these 17 million households owned roughly $67.24 trillion in liquid assets, or about $4 million per household.
In total, the world added $17.5 trillion of new private wealth between 2013 and 2014. The report notes that nearly three quarters of all these gains came from previously existing wealth. In other words, the vast majority of money gained has been due to pre-existing assets increasing in value—not the creation of new material things.
This trend is the result of the massive infusions of cheap credit into the financial markets by central banks. The policy of “quantitative easing” has led to a dramatic expansion of the stock market even while global economic growth has slumped.
While the wealth of the rich is growing at a breakneck pace, there is a stratification of growth within the super wealthy, skewed towards the very top.
In 2014, those with over $100 million in private wealth saw their wealth increase 11 percent in one year alone. Collectively, these households owned $10 trillion in 2014, 6 percent of the world’s private wealth. According to the report, “This top segment is expected to be the fastest growing, in both the number of households and total wealth.” They are expected to see 12 percent compound growth on their wealth in the next five years.
Those families with wealth between $20 and $100 million also rose substantially in 2014—seeing a 34 percent increase in their wealth in twelve short months. They now own $9 trillion. In five years they will surpass $14 trillion according to the report.
Coming in last in the “high net worth” population are those with between $1 million and $20 million in private wealth. These households are expected to see their wealth grow by 7.2 percent each year, going from $49 trillion to $70.1 trillion dollars, several percentage points below the highest bracket’s 12 percent growth rate.
The gains in private wealth of the ultra-rich stand in sharp contrast to the experience of billions of people around the globe. While wealth accumulation has sharply sped up for the ultra-wealthy, the vast majority of people have not even begun to recover from the past recession.
An Oxfam report from January, for example, shows that the bottom 99 percent of the world’s population went from having about 56 percent of the world’s wealth in 2010 to having 52 percent of it in 2014. Meanwhile the top 1 percent saw its wealth rise from 44 to 48 percent of the world’s wealth.
As the Organization for Economic Co-operation and Development (OECD) has noted, in the United States “between 2007 and 2013, net wealth fell on average 2.3 percent, but it fell ten-times more (26 percent) for those at the bottom 20 percent of the distribution.” The 2015 report concludes that “low-income households have not benefited at all from income growth.”
Another report by Knight Frank, looks at those with wealth exceeding $30 million. The report notes that in 2014 these 172,850 ultra-high-net-worth individuals increased their collective wealth by $700 billion. Their total wealth now rests at $20.8 trillion.
The report also draws attention to the disconnection between the rich and the actual economy. It states that the growth of this ultra-wealthy population “came despite weaker-than-anticipated global economic growth. During 2014 the IMF was forced to downgrade its forecast increase for world output from 3.7 percent to 3.3 percent.”
HILLARY CLINTON: CRONY CLASS’ “Hope and Change” huckster’s successor!
“I serve Obama’s cronies first, illegals second and together we will loot the American middle-class to double our figures. It’s called BAILOUTS! Evita Peron Clinton
At this point, Clinton is the choice of most multimillionaires to be the next occupant of the White House. A recent CNBC poll of 750 millionaires found 53 percent support for Clinton in a contest with Republican Jeb Bush, 14 points better than Obama’s showing in the 2012 election with the same group.
Sen. Bernie Sanders – America’s answer to Wall Street’s looting, the war on the American middle-class and jobs for legals!
“At this point, Clinton is the choice of most multimillionaires to be the next occupant of the White House. A recent CNBC poll of 750 millionaires found 53 percent support for Clinton in a contest with Republican Jeb Bush, 14 points better than Obama’s showing in the 2012 election with the same group.”
THE CRONY CLASS:
OBAMACLINTONOMICS was created by BILLARY CLINTON!
Income inequality grows FOUR TIMES FASTER under Obama than Bush.
“By the time of Bill Clinton’s election in 1992, the Democratic Party had completely repudiated its association with the reforms of the New Deal and Great Society periods. Clinton gutted welfare programs to provide an ample supply of cheap labor for the rich (WHICH NOW MEANS OPEN BORDERS AND NO E-VERIFY!), including a growing layer of black capitalists, and passed the 1994 Federal Crime Bill, with its notorious “three strikes” provision that has helped create the largest prison population in the world.”
“Calling income and wealth inequality the "great moral issue of our time," Sanders laid out a sweeping, almost unimaginably expensive program to transfer wealth from the richest Americans to the poor and middle class. A $1 trillion public works program to create "13 million good-paying jobs." A $15-an-hour federal minimum wage. "Pay equity" for women. Paid sick leave and vacation for everyone. Higher taxes on the wealthy. Free tuition at all public colleges and universities. A Medicare-for-all single-payer health care system. Expanded Social Security benefits. Universal pre-K.” WASHINGTON EXAMINER
OBAMA’S WALL STREET and the LOOTING of AMERICA – SECOND TERM
The corporate cash hoard has likewise reached a new record, hitting an estimated $1.79 trillion in the fourth quarter of last year, up from $1.77 trillion in the previous quarter. Instead of investing the money, however, companies are using it to buy back their own stock and pay out record dividends.
Megan McArdle Discusses How America's Elites Are Rigging the Rules - Newsweek/The Daily Beast special correspondent Megan McArdle joins Scott Rasmussen for a discussion on America's new Mandarin class.
WHO REALLY PAYS FOR THE CRIMES OF OBAMA’S CRONY DONORS???
LAST WEEK BARACK OBAMA CELEBRATED FIVE YEARS OF THE LOOTING BY HIS WALL STREET BANKSTERS… now it’s back to cutting social programs to pay for all that rape by the 1% he represents. The following week it will be back to the AMNESTY HOAX to legalize Mexico’s looting of America and make it legal that Mexicans get our jobs first… they already do!
OBAMA’S CRONY CAPITALISM – A NATION RULED BY CRIMINAL WALL STREET BANKSTERS AND OBAMA DONORS
PATRICK BUCHANAN
OBAMANOMICS: IS IT WORKING???
By Gabriel Black
Households with more than a million (US) dollars in private wealth are projected to own 46 percent of global private wealth in 2019 according to a new report by the Boston Consulting Group (BCG).
This large percentage, however, only includes cash, savings, money market funds and listed securities held through managed investments—collectively known as “private wealth.” It leaves out businesses, residences and luxury goods, which comprise a substantial portion of the rich’s net worth.
At the end of 2014, millionaire households owned about 41 percent of global private wealth, according to BCG. This means that collectively these 17 million households owned roughly $67.24 trillion in liquid assets, or about $4 million per household.
In total, the world added $17.5 trillion of new private wealth between 2013 and 2014. The report notes that nearly three quarters of all these gains came from previously existing wealth. In other words, the vast majority of money gained has been due to pre-existing assets increasing in value—not the creation of new material things.
This trend is the result of the massive infusions of cheap credit into the financial markets by central banks. The policy of “quantitative easing” has led to a dramatic expansion of the stock market even while global economic growth has slumped.
While the wealth of the rich is growing at a breakneck pace, there is a stratification of growth within the super wealthy, skewed towards the very top.
In 2014, those with over $100 million in private wealth saw their wealth increase 11 percent in one year alone. Collectively, these households owned $10 trillion in 2014, 6 percent of the world’s private wealth. According to the report, “This top segment is expected to be the fastest growing, in both the number of households and total wealth.” They are expected to see 12 percent compound growth on their wealth in the next five years.
Those families with wealth between $20 and $100 million also rose substantially in 2014—seeing a 34 percent increase in their wealth in twelve short months. They now own $9 trillion. In five years they will surpass $14 trillion according to the report.
Coming in last in the “high net worth” population are those with between $1 million and $20 million in private wealth. These households are expected to see their wealth grow by 7.2 percent each year, going from $49 trillion to $70.1 trillion dollars, several percentage points below the highest bracket’s 12 percent growth rate.
The gains in private wealth of the ultra-rich stand in sharp contrast to the experience of billions of people around the globe. While wealth accumulation has sharply sped up for the ultra-wealthy, the vast majority of people have not even begun to recover from the past recession.
An Oxfam report from January, for example, shows that the bottom 99 percent of the world’s population went from having about 56 percent of the world’s wealth in 2010 to having 52 percent of it in 2014. Meanwhile the top 1 percent saw its wealth rise from 44 to 48 percent of the world’s wealth.
In 2014 the Russell Sage Foundation found that between 2003 and 2013, the median household net worth of those in the United States fell from $87,992 to $56,335—a drop of 36 percent. While the rich also saw their wealth drop during the recession, they are more than making that money back. Between 2009 and 2012, 95 percent of all the income gains in the US went to the top 1 percent. This is the most distorted post-recession income gain on record.
As the Organization for Economic Co-operation and Development (OECD) has noted, in the United States “between 2007 and 2013, net wealth fell on average 2.3 percent, but it fell ten-times more (26 percent) for those at the bottom 20 percent of the distribution.” The 2015 report concludes that “low-income households have not benefited at all from income growth.”
Another report by Knight Frank, looks at those with wealth exceeding $30 million. The report notes that in 2014 these 172,850 ultra-high-net-worth individuals increased their collective wealth by $700 billion. Their total wealth now rests at $20.8 trillion.
The report also draws attention to the disconnection between the rich and the actual economy. It states that the growth of this ultra-wealthy population “came despite weaker-than-anticipated global economic growth. During 2014 the IMF was forced to downgrade its forecast increase for world output from 3.7 percent to 3.3 percent.”
THE CRONY CLASS:
OBAMACLINTONOMICS was created by BILLARY CLINTON!
Income inequality grows FOUR TIMES FASTER under Obama than Bush.
“By the time of Bill Clinton’s election in 1992, the Democratic Party had completely repudiated its association with the reforms of the New Deal and Great Society periods. Clinton gutted welfare programs to provide an ample supply of cheap labor for the rich (WHICH NOW MEANS OPEN BORDERS AND NO E-VERIFY!), including a growing layer of black capitalists, and passed the 1994 Federal Crime Bill, with its notorious “three strikes” provision that has helped create the largest prison population in the world.”
“Calling income and wealth inequality the "great moral issue of our time," Sanders laid out a sweeping, almost unimaginably expensive program to transfer wealth from the richest Americans to the poor and middle class. A $1 trillion public works program to create "13 million good-paying jobs." A $15-an-hour federal minimum wage. "Pay equity" for women. Paid sick leave and vacation for everyone. Higher taxes on the wealthy. Free tuition at all public colleges and universities. A Medicare-for-all single-payer health care system. Expanded Social Security benefits. Universal pre-K.” WASHINGTON EXAMINER
OBAMA’S WALL STREET and the LOOTING of AMERICA – SECOND TERM
The corporate cash hoard has likewise reached a new record, hitting an estimated $1.79 trillion in the fourth quarter of last year, up from $1.77 trillion in the previous quarter. Instead of investing the money, however, companies are using it to buy back their own stock and pay out record dividends.
Megan McArdle Discusses How America's Elites Are Rigging the Rules - Newsweek/The Daily Beast special correspondent Megan McArdle joins Scott Rasmussen for a discussion on America's new Mandarin class.
OBAMA’S CRONY CAPITALISM
A NATION RULED BY CRIMINAL WALL STREET BANKSTERS AND OBAMA DONORS
ttp://mexicanoccupation.blogspot.com/2013/05/pritzker-obama-adds-to-his-harem-of.html
OBAMANOMICS: IS IT WORKING???
ttp://mexicanoccupation.blogspot.com/2013/05/pritzker-obama-adds-to-his-harem-of.html
Millionaires projected to own 46 percent of global private wealth by 2019
By Gabriel Black
18 June 2015
Households with more than a million (US) dollars in private wealth are projected to own 46 percent of global private wealth in 2019 according to a new report by the Boston Consulting Group (BCG).
At the end of 2014, millionaire households owned about 41 percent of global private wealth, according to BCG. This means that collectively these 17 million households owned roughly $67.24 trillion in liquid assets, or about $4 million per household.
In total, the world added $17.5 trillion of new private wealth between 2013 and 2014. The report notes that nearly three quarters of all these gains came from previously existing wealth. In other words, the vast majority of money gained has been due to pre-existing assets increasing in value—not the creation of new material things.
This trend is the result of the massive infusions of cheap credit into the financial markets by central banks. The policy of “quantitative easing” has led to a dramatic expansion of the stock market even while global economic growth has slumped.
While the wealth of the rich is growing at a breakneck pace, there is a stratification of growth within the super wealthy, skewed towards the very top.
In 2014, those with over $100 million in private wealth saw their wealth increase 11 percent in one year alone. Collectively, these households owned $10 trillion in 2014, 6 percent of the world’s private wealth. According to the report, “This top segment is expected to be the fastest growing, in both the number of households and total wealth.” They are expected to see 12 percent compound growth on their wealth in the next five years.
Those families with wealth between $20 and $100 million also rose substantially in 2014—seeing a 34 percent increase in their wealth in twelve short months. They now own $9 trillion. In five years they will surpass $14 trillion according to the report.
Coming in last in the “high net worth” population are those with between $1 million and $20 million in private wealth. These households are expected to see their wealth grow by 7.2 percent each year, going from $49 trillion to $70.1 trillion dollars, several percentage points below the highest bracket’s 12 percent growth rate.
The gains in private wealth of the ultra-rich stand in sharp contrast to the experience of billions of people around the globe. While wealth accumulation has sharply sped up for the ultra-wealthy, the vast majority of people have not even begun to recover from the past recession.
An Oxfam report from January, for example, shows that the bottom 99 percent of the world’s population went from having about 56 percent of the world’s wealth in 2010 to having 52 percent of it in 2014. Meanwhile the top 1 percent saw its wealth rise from 44 to 48 percent of the world’s wealth.
In 2014 the Russell Sage Foundation found that between 2003 and 2013, the median household net worth of those in the United States fell from $87,992 to $56,335—a drop of 36 percent. While the rich also saw their wealth drop during the recession, they are more than making that money back. Between 2009 and 2012, 95 percent of all the income gains in the US went to the top 1 percent. This is the most distorted post-recession income gain on record.
As the Organization for Economic Co-operation and Development (OECD) has noted, in the United States “between 2007 and 2013, net wealth fell on average 2.3 percent, but it fell ten-times more (26 percent) for those at the bottom 20 percent of the distribution.” The 2015 report concludes that “low-income households have not benefited at all from income growth.”
Another report by Knight Frank, looks at those with wealth exceeding $30 million. The report notes that in 2014 these 172,850 ultra-high-net-worth individuals increased their collective wealth by $700 billion. Their total wealth now rests at $20.8 trillion.
The report also draws attention to the disconnection between the rich and the actual economy. It states that the growth of this ultra-wealthy population “came despite weaker-than-anticipated global economic growth. During 2014 the IMF was forced to downgrade its forecast increase for world output from 3.7 percent to 3.3 percent.”
OBAMA-CLINTONomics: the never end war on the American middle-class. But we still get the tax bills for the looting of their Wall Street cronies and their bailouts and billions for Mexico’s welfare state in our borders.
While the wealth of the rich is growing at a breakneck pace, there is a stratification of growth within the super wealthy, skewed towards the very top.
In 2014, those with over $100 million in private wealth saw their wealth increase 11 percent in one year alone. Collectively, these households owned $10 trillion in 2014, 6 percent of the world’s private wealth. According to the report, “This top segment is expected to be the fastest growing, in both the number of households and total wealth.” They are expected to see 12 percent compound growth on their wealth in the next five years.
In 2014 the Russell Sage Foundation found that between
2003 and 2013, the median household net worth of those in
Last week, parent company Ascena Retail Group, which also owns Ann Taylor, Loft and Lane Bryant stores, announced the closure of all 650 of its Dressbarn retail stores. Ascena also recently sold its Maurices clothing chain for a sale price of $200 million cash to the UK-based private equity firm OpCapita, portending further closures.
In a statement last Monday, Steven Taylor, the chief financial officer of Dressbarn, said that the chain had “not been operating at an acceptable level of profitability in today’s retail environment,” alluding to the increasing dominance of online marketing and retail. Although a final date how not been set for the store closures, Taylor said that the company will finish operations within the next 6 to 12 months.
Competition from online giants like Amazon has fed into mass store closures, putting pressure on major retailers to shift from already low paying jobs to more labor-intensive and exploitative distribution center jobs.
Approximately 6,800 workers will be thrown out of work by the liquidation of Dressbarn, all of whom the company insists will be offered timely information about their store closings and options for financial support.
However, the reality for the vast majority of these workers is that the store closures mean that they will be either unemployed or forced to take even lower paying work to meet their basic needs as clothing retailers like Ascena Retail Group look for ways to compete with major corporations like Amazon and Walmart.
Retail workers are already among the lowest paid workers in the United States. According to reports by employees to indeed.com, associates at Dressbarn earn as little as $8.95 an hour to $12 an hour for an assistant store manager. Meanwhile Ascena CEO Gary Muto’s total compensation was nearly $6 million in 2018, including a base pay of more than $1 million.
The recent wave of retail closures, dubbed the “retail apocalypse,” has intensified this year with the number of closings exceeding 7000 before Dressbarn’s announcement, surpassing the number of closures in all of 2018. According to Coresight Research, there were 5864 retail closures in 2018, which included all of the remaining Toys R Us stores, along with other major retail stores like Sears and Kmart. The record for number store closures announced in a single year was 2017 with 8,139.
These closures have hit areas in the Midwest and Northeast US particularly hard. According to data from the Bureau of Labor Statistics, retail employment in these areas has fallen by more than ten percent between January 2007 and February 2019.
Along with Dressbarn, other major retail chains that have announced large closures across the United States in 2019 include:
* Payless ShoeSource announced that it will close all 2589 of its stores after a second bankruptcy filing, including 248 stores in Canada.
* Gymboree Group, which owns both Gymboree and Crazy 8 stores, announced in January that it would close all 800 of its stores and shut down its website.
* Foot Locker, despite reporting a record earnings report, announced that it will close 165 stores.
* Gap announced that it will close 200 stores this year to focus more on its online store, which now accounts for 40 percent of its revenue.
* Charlotte Russe has announced that it will close all 500 of its stores after it announced the closure of 94 of its stores and could not find a buyer for those that remained open.
* Dollar Tree which, owns the Family Dollar chain, announced that it will shut down about 390 Family Dollar stores.
* Sears announced in February that it would downsize its stores by 1275, keeping 425 stores in operation after filing for bankruptcy.
At the rate retail store closures have been announced, this year will soon surpass the record set in 2017. Since the 2008 financial crisis, major retail companies have been subject to buyouts, acquisitions and mergers as retailers have been forced into bankruptcy by Wall Street. According to the real estate services firm Cushman & Wakefield, more than 9,000 stores are predicted to close in 2019 and 12,000 will follow in 2020.
Markets fall on trade war and global growth fears
Wall Street had a sharp fall yesterday, and the yield on the 10-year US Treasury bond dropped to its lowest level since 2017, amid concerns over the increasing tensions between the US and China, and indications of slowing global growth.
The Dow Jones index finished the day 286 points down, a decline of more than 1 percent, after dropping by 451 points earlier in the session, with 80 percent of the index’s components ending lower. The index is headed for its fifth straight weekly loss, which would be its longest such losing run since 2011.
Other major indexes experienced similar falls. The S&P 500 was down by 1.2 percent and the tech-heavy Nasdaq dropped by 1.6 percent. Despite the falls, these indexes are still up for the year—9.3 percent for the Dow and 13 percent for the S&P 500—largely as a result of the US Federal Reserve’s decision in March to shelve interest rate rises for the rest of the year and possibly longer.
There are growing concerns that the market fall is far from over. One sign of this sentiment was the move to the safety of government debt. Increased purchases of 10-year Treasury bonds pushed the yield down to 2.29 percent, its lowest point in 19 months, sending it below the yield on three-month Treasury bonds.
Normally the yield on long-term bonds is higher than that on short-term debt. The inversion of the yield curve, if it is sustained, is regarded as an indication of recession. Over the past weeks the gap between the two yields has fluctuated between positive and negative.
In its characterisation of the stock market, the Financial Times cited one fund manager who said it was “panic mode” and “people are realising that the economy could be a lot slower than we thought.”
Another fund chief, quoted by the newspaper said: “Equities are down because of global growth, and concerns that the trade war will lead to even lower growth. It you believe that then it makes sense for 10-year yields to fall.”
Bank of America has revised downward its estimates for Treasury yields. Pointing to the downward turn in the global economy, it said: “It would be simplistic to blame these forecast revisions purely on the latest chapter in the trade war saga. Central banks have shifted to a dramatically more dovish tone.” Also, inflation had continued to disappoint, “surprisingly so in the US,” as well as in Europe, and “Brexit and related uncertainty remains unresolved.”
The “dovish tone” by central banks refers to the abandonment of interest rate rises and moves to provide further stimulus in the face of a slowdown. This week the Reserve Bank of Australia indicated it was almost certain to cut its base rate by 0.25 percent next month, followed by a similar cut later in the year, taking it to a new record low of 1 percent.
In an apparent attempt to calm market turbulence over the economic conflict with China, US President Donald Trump said the issue of the Chinese telecoms giant Huawei could be included in a US-China trade deal.
Last week the Commerce Department placed Huawei on its Restricted Entity List, on the grounds that it was engaged in activities contrary to US “national security” interests. In effect, this banned the supply of US components needed to sustain Huawei’s global operations.
In his latest comments, Trump said that while Huawei was “very dangerous from a security standpoint,” it was “possible that Huawei could be included as part of a trade deal” and there remained a “good possibility” that the US-China talks could get back on track.
Trump’s remarks—that while Huawei is “very dangerous,” it could yet be part of a “deal”—show that the alleged “national security” threats have been bogus from the outset, invoked as a means of crippling Huawei’s operations.
The Trump administration also announced a $16 billion assistance package to agricultural producers that have been hard hit by Chinese tariffs imposed in retaliation against US tariff measures. This followed a $12 billion package last year.
This indicates that the administration has all but ruled out any agreement on trade and is digging in for a long conflict.
Agriculture Secretary Sonny Perdue said the assistance payments would come in three tranches, the first of which would be made in July or August. He effectively ruled out any prospect for a deal before then, including at talks between Trump and China’s president Xi Jinping at the G20 summit in Japan at the end of next month.
“While we would love a trade deal in that period of time… it’ll be very difficult to understand how a trade deal could be consummated prior to that first payment,” he said.
Perdue said the second payment in November, and the third one set for January 2020, would depend on the fate of the trade talks.
The official Chinese reaction to the latest measures against Huawei remains somewhat muted. In a statement yesterday, Commerce Ministry spokesman Gao Feng said: “The US… crackdown on Chinese companies not only seriously damages the normal commercial co-operation between both countries but it also forms a great threat to the security of the global industrial and supply chain. China is firmly opposed to this. We will closely monitor developments and make adequate preparations.”
Beijing is anxious to present itself as the defender of the present international trading order against the actions of the United States and so has been relatively constrained in its response to this point.
However, there is intense hostility within sections of the regime to the US measures. So far, this has been confined to verbal denunciations but as the US economic confrontation continues, it could take more direct forms, such as cuts in the supply of raw earth minerals, of which China is a major global supplier, impacting on the production of batteries and electronics components.
"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."
“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
STRIKES ALL OVER AMERICA, THOUSANDS OF RETAIL STORES CLOSING, CAR SALES SLUMP, REAL ESTATE IN THE DOLDRUMS… That is the real “recover”… It only happened for the rich!
Despite a booming economy, many U.S. households are still just holding on
https://www.latimes.com/business/la-fi-federal-reserve-household-survey-20190523-story.html
By MATTHEW BOESLER
Many U.S. households find themselves in a fragile position financially, even in an economy with an unemployment rate near a 50-year low. (David Sacks / Getty Images)
Many U.S. households find themselves in a fragile position financially, even in an economy with an unemployment rate near a 50-year low, according to a Federal Reserve survey.
The Fed’s 2018 report on the economic well-being of households, published Thursday, indicated “most measures” of well-being and financial resilience “were similar to, or slightly better than, those in 2017.” The slight improvement coincided with a decline in the average unemployment rate to 3.9% last year, from 4.3% in 2017.
Despite the uptick, however, the results of the 2018 survey indicated that almost 40% of Americans would still struggle in the face of a $400 financial emergency. The statistic, which was a bit better than in the 2017 report, has become a favorite rejoinder to President Trump’s boasts about a strong economy from Democratic politicians, including 2020 presidential candidate Sen. Kamala Harris of California.
“Relatively small, unexpected expenses, such as a car repair or replacing a broken appliance, can be a hardship for many families without adequate savings,” the report said. “When faced with a hypothetical expense of $400, 61% of adults in 2018 say they would cover it, using cash, savings, or a credit card paid off at the next statement,” it added.
“Among the remaining 4 in 10 adults who would have more difficulty covering such an expense, the most common approaches include carrying a balance on credit cards and borrowing from friends or family,” according to the report.
Based on a survey of 11,000 people in October and November 2018, the report showed that a quarter of Americans don’t feel like they are doing "at least OK" financially. That number was higher for black and Latino Americans, at roughly one-third for both. For those making less than $40,000 a year, the share who felt they weren’t doing well was 44%.
“We continue to see the growing U.S. economy supporting most American families,” Fed Gov. Michelle Bowman said in a press release accompanying the report.
“At the same time, the survey does find differences across communities, with just over half of those living in rural areas describing their local economy as good or excellent compared to two-thirds of those living in cities,” Bowman said. “Across the country, many families continue to experience financial distress and struggle to save for retirement and unexpected expenses.”
Boesler writes for Bloomberg
"While America’s working and middle class have been subjected to compete for jobs against a constant flow of cheaper foreign workers — where more than 1.2 million mostly low-skilled immigrants are admitted to the country annually — the billionaire class has experienced historic salary gains." Sen. Josh Hawley
The millennial generation in the US: Life on the brink
For the American ruling elite, life has
never been better.
The father of US Treasury Secretary Steven Mnuchin just completed the most expensive purchase of a living artist’s work in US history, spending over $91 million on a three-foot-tall metallic sculpture. Ken Griffin, the founder of hedge fund Citadel, recently dropped $238 million on a penthouse in New York City, the most expensive US home ever purchased. And Amazon’s Jeff Bezos, the world’s richest man, has invested $42 million in a 10,000-year clock.
The stock market is booming, and President Donald Trump is boasting at every turn that the unemployment rate is lower than it has been in five decades.
However, the working class, the vast majority of the population, is confronting an unprecedented social, economic, health and psychological crisis. The same processes that have produced vast sums of wealth for the ruling elite have left millions of workers on the brink of existence.
Perhaps no segment of the population reflects the devastating consequences of these processes so starkly as the generation of young people deemed the “millennials,” those born roughly between the years 1981 and 1996. More than half the 72 million American millennials are now in their 30s, with the oldest turning 38 this year.
A recent exposé by the Wall Street Journal noted that millennials are “in worse financial shape than prior living generations and may not recover.” The article, “Millennials Near Middle Age in Crisis,” concludes by stating that people born in the 1980s are at risk of becoming “America’s Lost generation.”
The older side of this generation was born at the beginning of the Reagan years, which heralded in an era of social counter-revolution against the working class that saw the dismantling of much of the industrial infrastructure of the country, and the restructuring of economic life to benefit the banks, hedge funds and other financial firms, with the collaboration of the trade unions.
By the time these youth reached the job market, the 2008 financial crash hit, vastly accelerating all of the processes begun in the 1980s. The Obama administration organized the bailout of the banks and a massive transfer of wealth from the working class to the rich.
The results have been devastating.
Education
More millennials have a college degree than any other generation of young adults. In 2013, 47 percent of 25- to 34-year-olds received a postsecondary degree. For most, however, getting a college education has not led to a significant increase in quality of living.
Instead, millions of young people are working jobs for which they are vastly overqualified and are shackled with unprecedented levels of debt. For the millennials who did not go to college, the situation is even worse.
· Millennials have taken on 300 percent more student debt than their parents’ generation. [Source: The College Board, Trends in Student Aid 2013]
· The number of hours of minimum wage work needed to pay in-state tuition and fees for each year of a four-year public college for the “Baby Boomer” generation (born between 1946 and 1964) was 510. For millennials, it is 1996. [Source: National Center for Education Statistics. Calculations based on four-year public universities from 1973–1976 and 2003–2006]
· Since 2010, the economy has added 11.6 million jobs, and 11.5 million of them have gone to workers with at least some college education. In 2016, young workers with only a high school diploma had roughly triple the unemployment rate and three-and-a-half times the poverty rate of college grads. [Source: America’s Divided Recovery, Georgetown University]
· Average college debt for millennials that have debt is around $33,000, with the median household income remaining the same since 1999. [Source: PEW Research and USA Today]
· National college debt is now at $1.3 trillion, and college tuition has increased by 1,140 percent since the late 1970s. [Source: Economic Policy Institute (EPI) Wage Stagnation in Nine Charts]
· By 2014, 48 percent of workers with bachelor’s degrees are employed in jobs for which they’re overqualified. [Source: Labor Economist Stephen Rose, published by Urban Institute.]
Graph from the Economic Policy Institute
Decades of decaying capitalism have led to this accelerating divide. While the rich accumulate wealth with no restriction, workers’ wages and benefits have been under increasing attack. In 1979, 90 percent of the population took in 70 percent of the nation’s income. But, by 2017, that fell to only 61 percent.
"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
“Behind the ostensible government sits enthroned an invisible government owing no allegiance and acknowledging no responsibility to the people. To destroy this invisible government, to befoul the unholy alliance between corrupt business and corrupt politics is the first task of the statesmanship of today.” THEODORE ROOSEVELT
"But what the Clintons do is criminal because they do it wholly at the expense of the American people. And they feel thoroughly entitled to do it: gain power, use it to enrich themselves and their friends. They are amoral, immoral, and venal. Hillary has no core beliefs beyond power and money. That should be clear to every person on the planet by now." ---- Patricia McCarthy - AMERICANTHINKER.com
“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."
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."
In 2014 the Russell Sage Foundation found that between
2003 and 2013, the median household net worth of those in the United States fell from $87,992 to $56,335—a drop of 36 percent. While the rich also saw their wealth drop during the recession, they are more than making that money back.
Between 2009 and 2012, 95 percent of all the income gains in the US went to the top 1 percent. This is the most distorted post-recession income gain on record.
Watch–Josh Hawley Rips ‘Aristocratic Elite’ for Engineering U.S. Economy Against American Middle Class
JOHN BINDER
16 May 2019184
6:00
Sen. Josh Hawley (R-MO) ripped what he called the country’s “new aristocratic elite” for engineering the United States economy against the American middle class.
For his first major speech on the Senate floor, Hawley slammed the “big banks, big tech, big multi-national corporations, along with their allies in the academy and the media,” whom he said have created an economic structure in which they, the well-connected, benefit while the American working and middle class increasingly struggle to get ahead.
Hawley said:
The chattering class often tells us that all of this—the jobs, the despair, the loss of standing—is the result of forces beyond anyone’s control. As if that’s an excuse to do nothing. But in fact, it’s not true. [Emphasis added]
Today’s society benefits those who shaped it, and it has been shaped not by working men and women, but by the new aristocratic elite. Big banks, big tech, big multi-national corporations, along with their allies in the academy and the media—these are the aristocrats of our age. They live in the United States, but they consider themselves citizens of the world. [Emphasis added]
They operate businesses or run universities here, but their primary loyalty is to their own agenda for a more unified, progressive—and profitable—global order. These modern aristocrats often claim to be a meritocracy. And many of them truly believe they are. What they don’t see, or won’t acknowledge, is that the society they have built works mainly for themselves. They’ve effectively run this country for decades. And their legacy is national division and national decline. [Emphasis added]
Defending the needs of the American middle class against a growingly powerful “aristocratic elite” is the “crisis of our time,” Hawley asserted.
“After years of sacrifice, the great American middle is being pushed aside by a new, arrogant aristocracy,” Hawley said. “The new aristocrats seek to remake society in their own image: to engineer an economy that works for the elite but few else, to fashion a culture that is dominated by their own preferences.”
“This town has embraced a politics of elite values and elite ambition rather than building opportunities to thrive in the great and broad American middle. This has left middle America—the great American middle class—under siege: battling the loss of respect and work, the decline of home and family, an epidemic of loneliness and despair,” Hawley continued. “This is the crisis of our time.”
Specifically, Hawley blasted multinational corporations for outsourcing American middle class jobs overseas — wreaking economic, cultural, and social havoc on rural and small town American communities in the process — and both political establishments for treating American citizens as mere consumers.
“In places like the one where I grew up, in middle Missouri, good-paying jobs that you can raise a family on are going away,” Hawley said. “The jobs go overseas or south of the border or to cities on the coasts. And once-vibrant towns decline, taking with them the network of schools and neighborhoods and churches that make up middle class life.”
Hawley continued:
Rural America has been particularly hard hit. Rural Americans’ life expectancy has not just leveled off, its actually dropped, and for women without a high school degree, that drop has been staggering. In some rural places, residents struggle with outright deprivation. [Emphasis added]
My home state contains some of the poorest counties in America, all in rural places that once boasted thriving small towns. As those communities struggle, want sets in. But the crisis reaches well beyond economics. [Emphasis added]
The message that Washington has sent our whole society is loud and clear: our elites are the people who matter—and those who aspire to join them. Everyone else is unimportant or backwards. And millions of Americans are left with the sense that the people who run this country view them with nothing but contempt and value them as nothing but consumers. [Emphasis added]
Indeed, working and middle class Americans have been hit the hardest from decades-long political consensus between the Republican establishment and Democrats.
Recent research revealed that while coastal, elite metropolis cities have flourished in the last decade, small town and rural American communities have suffered depopulation, mass job loss, and continued economic strain since the Great Recession.
For instance, by 2016, elite zip codes had a surplus of 3.6 million jobs, which is more than the combined bottom 80 percent of American zip codes. While it only took about five years for wealthy cities to replace the jobs lost by the recession, it took “at risk” regions of the country a decade to recover, and “distressed” U.S. communities are “unlikely ever to recover on current trendlines,” the report predicts.
Economic growth among the country’s middle-class counties and middle-class zip codes has considerably trailed national economic growth. For example, between 2012 and 2016, there were 4.4 percent more business establishments in the country as a whole. That growth was less than two percent in the median zip code and there was close to no growth in the median county.
While America’s working and middle class have been subjected to compete for jobs against a constant flow of cheaper foreign workers — where more than 1.2 million mostly low-skilled immigrants are admitted to the country annually — the billionaire class has experienced historic salary gains.
A study by the Economic Policy Institute found that the country’s top 0.01 percent have enjoyed more than 15 times as much wage growth as the bottom 90 percent of wage earners. Between 1979 and 2017, working and middle class Americans’ wages grew by only 22 percent. On the other hand, the plutocrat class saw their salaries grow by more than 155 percent over the same period.
Likewise, free trade deals like NAFTA — supported by Republicans and Democrats — as well as China’s entering the World Trade Organization (WTO) has eliminated nearly five million American manufacturing jobs across the country, devastating steel towns and U.S. autoworkers. One former steel town in West Virginia lost 94 percent of its steel jobs because of NAFTA, with nearly 10,000 workers in the town being displaced from the steel industry.
Billionaire Class Enjoys 15X the Wage Growth of American Working Class
3:00
The billionaire class — the country’s top 0.01 percent of earners — have enjoyed more than 15 times as much wage growth as America’s working and middle class since 1979, new wage data reveals.
Between 1979 and 2017, the wages of the bottom 90 percent — the country’s working and lower middle class — have grown by only about 22 percent, Economic Policy Institute (EPI) researchers find.
Compare that small wage increase over nearly four decades to the booming wage growth of America’s top one percent, who have seen their wages grow more than 155 percent during the same period.
Breitbart TV
The top 0.01 percent — the country’s billionaire class — saw their wages grow by more than 343 percent in the last four decades, more than 15 times the wage growth of the bottom 90 percent of Americans.
In 1979, America’s working class was earning on average about $29,600 a year. Fast forward to 2017, and the same bottom 90 percent of Americans are earning only about $6,600 more annually.
The almost four decades of wage stagnation among the country’s working and middle class comes as the national immigration policy has allowed for the admission of more than 1.5 million mostly low-skilled immigrants every year.
(Public Citizen)
In the last decade, alone, the U.S. admitted ten million legal immigrants, forcing American workers to compete against a growing population of low-wage workers. Meanwhile, employers are able to reduce wages and drive up their profit margins thanks to the annual low-skilled immigration scheme.
The Washington, DC-imposed mass immigration policy is a boon to corporate executives, Wall Street, big business, and multinational conglomerates as every one percent increase in the immigrant composition of an occupation’s labor force reduces Americans’ hourly wages by 0.4 percent. Every one percent increase in the immigrant workforce reduces Americans’ overall wages by 0.8 percent.
Mass immigration has come at the expense of America’s working and middle class, which has suffered from poor job growth, stagnant wages, and increased public costs to offset the importation of millions of low-skilled foreign nationals.
Four million young Americans enter the workforce every year, but their job opportunities are further diminished as the U.S. imports roughly two new foreign workers for every four American workers who enter the workforce. Even though researchers say 30 percent of the workforce could lose their jobs due to automation by 2030, the U.S. has not stopped importing more than a million foreign nationals every year.
For blue-collar American workers, mass immigration has not only kept wages down but in many cases decreased wages, as Breitbart News reported. Meanwhile, the U.S. continues importing more foreign nationals with whom working-class Americans are forced to compete. In 2016, the U.S. brought in about 1.8 million mostly low-skilled immigrants.
Study: Elite Zip Codes Thrived in Obama Recovery, Rural America Left Behind
Getty Images
4:49
Wealthy cities and elite zip codes thrived under the slow-moving economic recovery of President Obama while rural American communities were left behind, a study reveals.
The Economic Innovation Group research, highlighted by Axios, details the massive economic inequality between the country’s coastal city elites and middle America’s working class between the Great Recession in 2007 and Obama’s economic recovery in 2016.
Between 2007 and 2016, the number of residents living in elite zip codes grew by more than ten million, with an overwhelming faction of that population growth being driven by mass immigration where the U.S. imports more than 1.5 million illegal and legal immigrants annually.
The booming 44.5 million immigrant populations are concentrated mostly in the country’s major cities like Los Angeles, California, Miami Florida, and New York City, New York. The rapidly growing U.S. population — driven by immigration — is set to hit 404 millionby 2060, a boon for real estate developers, wealthy investors, and corporations, all of which benefit greatly from dense populations and a flooded labor market.
The economic study found that while the population grew in wealthy cities, America’s rural population fell by nearly 3.5 million residents.
Likewise, by 2016, elite zip codes had a surplus of 3.6 million jobs, which is more than the combined bottom 80 percent of American zip codes. While it only took about five years for wealthy cities to replace the jobs lost by the recession, it took “at risk” regions of the country a decade to recover, and “distressed” U.S. communities are “unlikely ever to recover on current trendlines,” the report predicts.
A map included in the research shows how rich, coastal metropolises have boomed economically while entire portions of middle America have been left behind as job and business gains remain concentrated at the top of the income ladder.
(Economic Innovation Group)
(Economic Innovation Group)
Economic growth among the country’s middle-class counties and middle-class zip codes has considerably trailed national economic growth, the study found.
For example, between 2012 and 2016, there were 4.4 percent more business establishments in the country as a whole. That growth was less than two percent in the median zip code and there was close to no growth in the median county.
The same can be said of employment growth, where U.S. employment grew by about 9.3 percent from 2012 to 2016. In the median zip code, though, employment grew by only 5.5 percent and in the median county, employment grew by less than four percent.
“Nearly three in every five large counties added businesses on net over the period, compared to only one in every five small one,” the report concluded.
Elite zip codes added more business establishments during Obama’s economic recovery, between 2012 and 2016, than the entire bottom 80 percent of zip codes combined. For instance, while more than 180,000 businesses have been added to rich zip codes, the country’s bottom tier has lost more than 13,000 businesses even after the economic recovery.
(Economic Innovation Group)
(Economic Innovation Group)
The gutting of the American manufacturing base, through free trade, has been a driving catalyst for the collapse of the white working class and black Americans. Simultaneously, the outsourcing of the economy has brought major wealth to corporations, tech conglomerates, and Wall Street.
The dramatic decline of U.S. manufacturing at the hands of free trade—where more than 3.4 million American jobs have been lost solely due to free trade with China, not including the American jobs lost due to agreements like the North American Free Trade Agreement (NAFTA) and the United States-Korea Free Trade Agreement (KORUS)—has coincided with growing wage inequality for white and black Americans, a growing number of single mother households, a drop in U.S. marriage rates, a general stagnation of working and middle class wages, and specifically, increased black American unemployment.
“So, the loss of manufacturing work since 1960 represents a steady decline in relatively high-paying jobs for less-educated workers,” recent research from economist Eric D. Gould has noted.
Fast-forward to the modern economy and the wage trend has been the opposite of what it was during the peak of manufacturing in the U.S. An Economic Policy Institute studyfound this year that been 2009 and 2015, the top one percent of American families earned about 26 times as much income as the bottom 99 percent of Americans.
Record high income in 2017 for top one percent of wage earners in US
In 2017, the top one percent of US wage earners received their highest paychecks ever, according to a report by the Economic Policy Institute (EPI).
Based on newly released data from the Social Security Administration, the EPI shows that the top one percent of the population saw their paychecks increase by 3.7 percent in 2017—a rate nearly quadruple the bottom 90 percent of the population. The growth was driven by the top 0.1 percent, which includes many CEOs and corporate executives, whose pay increased eight percent and averaged $2,757,000 last year.
The EPI report is only the latest exposure of the gaping inequality between the vast majority of the population and the modern-day aristocracy that rules over them.
The EPI shows that the bottom 90 percent of wage earners have increased their pay by 22.2 percent between 1979 and 2017. Today, this bottom 90 percent makes an average of just $36,182 a year, which is eaten up by the cost of housing and the growing burden of education, health care, and retirement.
Meanwhile, the top one percent has increased its wages by 157 percent during this same period, a rate seven times faster than the other group. This top segment makes an average of $718,766 a year. Those in-between, the 90th to 99th percentile, have increased their wages by 57.4 percent. They now make an average of $152,476 a year—more than four times the bottom 90 percent.
Graph from the Economic Policy Institute
Decades of decaying capitalism have led to this accelerating divide. While the rich accumulate wealth with no restriction, workers’ wages and benefits have been under increasing attack. In 1979, 90 percent of the population took in 70 percent of the nation’s income. But, by 2017, that fell to only 61 percent.
Even more, while the bottom 90 percent of the population may take in 61 percent of the wages, large sections of the workforce today barely pull in any income at all. For example, Social Security Administration data found that the bottom 54 percent of wage earners in the United States, 89.5 million people, make an average of just $15,100 a year. This 54 percent of the population earns only 17 percent of all wages paid in America.
However unequal, these wage inequalities still do not fully present the divide between rich and poor. The ultra-wealthy derive their wealth not primarily from wages, but from assets and equities—principally from the stock market. While the bottom 90 percent of the population made 61 percent of the wages in 2017, they owned even less, just 27 percent of the wealth (according to the World Inequality Report 2018 by Thomas Piketty, Emmanuel Saez, and Gabriel Zucman).
The massive increase in the value of the stock market, which only a small segment of the population participates in, means that the top 10 percent of the population controls 73 percent of all wealth in the United States. Just three men—Jeff Bezos, Warren Buffet and Bill Gates—had more wealth than the bottom half of America combined last year.
Wages are so low in the United States that roughly half of the population falls deeper into debt every year. A Reuters report from July found that the pretax net income (that is, income minus expense) of the bottom 40 percent of the population was an average of negative $11,660. Even the middle quintile of the population, the 40th to 60th percentile, breaks even with an average of only $2,836 a year.
As the Social Security Administration numbers show, 67.4 percent of the population made less than the average wage, $48,250 a year in 2017, a sum that is inadequate to support a family in many cities—especially, with high housing costs, health care, education, and retirement factored in.
For the ruling class, though, workers’ wages are already too much. The volatility of the stock market and the deep fear that the current bull market will collapse has made politicians and businessmen anxious of any sign of wage increases.
In August, wages in the US rose just 0.2 percent above the inflation rate, the highest in nine years. Though the increase was tiny, it was enough to encourage the Federal Reserve to increase the interest rate past two percent for the first time since 2008. Raising interest rates helps to depress workers’ wages by lowering borrowing and spending. As the Financial Times noted, stopping wage growth was “central” to the Federal Reserve’s move.
Further analysis of the Social Security Administration data shows that in 2017, 147,754 people reported wages of 1 million dollars or more—roughly, the top 0.05 percent. Their combined total income of $372 billion could pay for the US federal education budget five times over.
These wages, however large, still pale in comparison to the money the ultra-rich acquire from the stock market. For example, share buybacks and dividend payments, a way of funneling money to shareholders, will eclipse $1 trillion this year.
Whatever the immediate source, the wealth of the rich derives from the great mass of people who do the actual work. Across the United States and around the world, workers, young people, and students have entered into struggle this year over pay, education, health care, immigration, war and democratic rights. This growing movement of the working class must set as its aim confiscating the wealth and power of this tiny parasitic oligarchy. Society’s wealth must be democratically controlled by those who produce it.
THE STAGGERING ECONOMIC INEQUALITY UNDER OBAMA'S ADMINISTRATION SERVING THE BILLIONAIRE CLASS.
THE ENTIRE REASON BEHIND AMNESTY IS TO KEEP WAGES DEPRESSED AND PASS ALONG THE REAL COST OF "CHEAP" MEXICAN LABOR TO THE AMERICAN MIDDLE CLASS.
AND IT'S WORKING!
SEN. BERNIE SANDERS
“Calling income and wealth inequality the "great moral issue of our time," Sanders laid out a sweeping, almost unimaginably expensive program to transfer wealth from the richest Americans to the poor and middle class. A $1 trillion public works program to create "13 million good-paying jobs." A $15-an-hour federal minimum wage. "Pay equity" for women. Paid sick leave and vacation for everyone. Higher taxes on the wealthy. Free tuition at all public colleges and universities. A Medicare-for-all single-payer health care system. Expanded Social Security benefits. Universal pre-K.” WASHINGTON EXAMINER
YOU THOUGHT OBAMA INVITED OBAMANOMICS and started the assault on the American middle-class?
NOPE!
“By the time of Bill Clinton’s election in 1992, the Democratic Party had completely repudiated its association with the reforms of the New Deal and Great Society periods. Clinton gutted welfare programs to provide an ample supply of cheap labor for the rich (WHICH NOW MEANS OPEN BORDERS AND NO E-VERIFY!), including a growing layer of black capitalists, and passed the 1994 Federal Crime Bill, with its notorious “three strikes” provision that has helped create the largest prison population in the world.”
Clinton Foundation Put On Watch List Of Suspicious ‘Charities’
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 report found that the growth of global inequality has accelerated sharply since the 2008 financial crisis, as the values of financial assets have soared while wages have stagnated and declined.
Millionaires projected to own 46 percent of global private wealth by 2019
By Gabriel Black
Households with more than a million (US) dollars in private wealth are projected to own 46 percent of global private wealth in 2019 according to a new report by the Boston Consulting Group (BCG).
This large percentage, however, only includes cash, savings, money market funds and listed securities held through managed investments—collectively known as “private wealth.” It leaves out businesses, residences and luxury goods, which comprise a substantial portion of the rich’s net worth.
At the end of 2014, millionaire households owned about 41 percent of global private wealth, according to BCG. This means that collectively these 17 million households owned roughly $67.24 trillion in liquid assets, or about $4 million per household.
In total, the world added $17.5 trillion of new private wealth between 2013 and 2014. The report notes that nearly three quarters of all these gains came from previously existing wealth. In other words, the vast majority of money gained has been due to pre-existing assets increasing in value—not the creation of new material things.
This trend is the result of the massive infusions of cheap credit into the financial markets by central banks. The policy of “quantitative easing” has led to a dramatic expansion of the stock market even while global economic growth has slumped.
While the wealth of the rich is growing at a breakneck pace, there is a stratification of growth within the super wealthy, skewed towards the very top.
In 2014, those with over $100 million in private wealth saw their wealth increase 11 percent in one year alone. Collectively, these households owned $10 trillion in 2014, 6 percent of the world’s private wealth. According to the report, “This top segment is expected to be the fastest growing, in both the number of households and total wealth.” They are expected to see 12 percent compound growth on their wealth in the next five years.
Those families with wealth between $20 and $100 million also rose substantially in 2014—seeing a 34 percent increase in their wealth in twelve short months. They now own $9 trillion. In five years they will surpass $14 trillion according to the report.
Coming in last in the “high net worth” population are those with between $1 million and $20 million in private wealth. These households are expected to see their wealth grow by 7.2 percent each year, going from $49 trillion to $70.1 trillion dollars, several percentage points below the highest bracket’s 12 percent growth rate.
The gains in private wealth of the ultra-rich stand in sharp contrast to the experience of billions of people around the globe. While wealth accumulation has sharply sped up for the ultra-wealthy, the vast majority of people have not even begun to recover from the past recession.
An Oxfam report from January, for example, shows that the bottom 99 percent of the world’s population went from having about 56 percent of the world’s wealth in 2010 to having 52 percent of it in 2014. Meanwhile the top 1 percent saw its wealth rise from 44 to 48 percent of the world’s wealth.
In 2014 the Russell Sage Foundation found that between 2003 and 2013, the median household net worth of those in the United States fell from $87,992 to $56,335—a drop of 36 percent. While the rich also saw their wealth drop during the recession, they are more than making that money back. Between 2009 and 2012, 95 percent of all the income gains in the US went to the top 1 percent. This is the most distorted post-recession income gain on record.
As the Organization for Economic Co-operation and Development (OECD) has noted, in the United States “between 2007 and 2013, net wealth fell on average 2.3 percent, but it fell ten-times more (26 percent) for those at the bottom 20 percent of the distribution.” The 2015 report concludes that “low-income households have not benefited at all from income growth.”
Another report by Knight Frank, looks at those with wealth exceeding $30 million. The report notes that in 2014 these 172,850 ultra-high-net-worth individuals increased their collective wealth by $700 billion. Their total wealth now rests at $20.8 trillion.
The report also draws attention to the disconnection between the rich and the actual economy. It states that the growth of this ultra-wealthy population “came despite weaker-than-anticipated global economic growth. During 2014 the IMF was forced to downgrade its forecast increase for world output from 3.7 percent to 3.3 percent.”
HILLARY CLINTON: CRONY CLASS’ “Hope and Change” huckster’s successor!
“I serve Obama’s cronies first, illegals second and together we will loot the American middle-class to double our figures. It’s called BAILOUTS! Evita Peron Clinton
At this point, Clinton is the choice of most multimillionaires to be the next occupant of the White House. A recent CNBC poll of 750 millionaires found 53 percent support for Clinton in a contest with Republican Jeb Bush, 14 points better than Obama’s showing in the 2012 election with the same group.
Sen. Bernie Sanders – America’s answer to Wall Street’s looting, the war on the American middle-class and jobs for legals!
“At this point, Clinton is the choice of most multimillionaires to be the next occupant of the White House. A recent CNBC poll of 750 millionaires found 53 percent support for Clinton in a contest with Republican Jeb Bush, 14 points better than Obama’s showing in the 2012 election with the same group.”
THE CRONY CLASS:
OBAMACLINTONOMICS was created by BILLARY CLINTON!
Income inequality grows FOUR TIMES FASTER under Obama than Bush.
“By the time of Bill Clinton’s election in 1992, the Democratic Party had completely repudiated its association with the reforms of the New Deal and Great Society periods. Clinton gutted welfare programs to provide an ample supply of cheap labor for the rich (WHICH NOW MEANS OPEN BORDERS AND NO E-VERIFY!), including a growing layer of black capitalists, and passed the 1994 Federal Crime Bill, with its notorious “three strikes” provision that has helped create the largest prison population in the world.”
*
“Calling income and wealth inequality the "great moral issue of our time," Sanders laid out a sweeping, almost unimaginably expensive program to transfer wealth from the richest Americans to the poor and middle class. A $1 trillion public works program to create "13 million good-paying jobs." A $15-an-hour federal minimum wage. "Pay equity" for women. Paid sick leave and vacation for everyone. Higher taxes on the wealthy. Free tuition at all public colleges and universities. A Medicare-for-all single-payer health care system. Expanded Social Security benefits. Universal pre-K.” WASHINGTON EXAMINER
OBAMA’S WALL STREET and the LOOTING of AMERICA – SECOND TERM
The corporate cash hoard has likewise reached a new record, hitting an estimated $1.79 trillion in the fourth quarter of last year, up from $1.77 trillion in the previous quarter. Instead of investing the money, however, companies are using it to buy back their own stock and pay out record dividends.
Megan McArdle Discusses How America's Elites Are Rigging the Rules - Newsweek/The Daily Beast special correspondent Megan McArdle joins Scott Rasmussen for a discussion on America's new Mandarin class.
WHO REALLY PAYS FOR THE CRIMES OF OBAMA’S CRONY DONORS???
LAST WEEK BARACK OBAMA CELEBRATED FIVE YEARS OF THE LOOTING BY HIS WALL STREET BANKSTERS… now it’s back to cutting social programs to pay for all that rape by the 1% he represents. The following week it will be back to the AMNESTY HOAX to legalize Mexico’s looting of America and make it legal that Mexicans get our jobs first… they already do!
As in previous budget crises under the Obama administration, the events are being stage-managed by the two corporate-controlled parties to give the illusion of partisan gridlock and confrontation over principles—in this case, whether to go forward with the implementation of the Obama health care program—while behind the scenes all factions within the ruling elite agree that massive cuts must be carried through in basic federal social programs.
OBAMA’S CRONY CAPITALISM – A NATION RULED BY CRIMINAL WALL STREET BANKSTERS AND OBAMA DONORS
GET THIS BOOK
Culture of Corruption: Obama and His Team of Tax Cheats, Crooks, and Cronies
by Michelle Malkin
In her shocking new book, Malkin digs deep into the records of President Obama's staff, revealing corrupt dealings, questionable pasts, and abuses of power throughout his administration.
PATRICK BUCHANAN
After Obama has completely destroyed the American economy, handed millions of jobs to illegals and billions of dollars in welfare to illegals…. BUT WHAT COMES NEXT?
OBAMANOMICS: IS IT WORKING???
Millionaires projected to own 46 percent of global private wealth by 2019
By Gabriel Black
Households with more than a million (US) dollars in private wealth are projected to own 46 percent of global private wealth in 2019 according to a new report by the Boston Consulting Group (BCG).
This large percentage, however, only includes cash, savings, money market funds and listed securities held through managed investments—collectively known as “private wealth.” It leaves out businesses, residences and luxury goods, which comprise a substantial portion of the rich’s net worth.
At the end of 2014, millionaire households owned about 41 percent of global private wealth, according to BCG. This means that collectively these 17 million households owned roughly $67.24 trillion in liquid assets, or about $4 million per household.
In total, the world added $17.5 trillion of new private wealth between 2013 and 2014. The report notes that nearly three quarters of all these gains came from previously existing wealth. In other words, the vast majority of money gained has been due to pre-existing assets increasing in value—not the creation of new material things.
This trend is the result of the massive infusions of cheap credit into the financial markets by central banks. The policy of “quantitative easing” has led to a dramatic expansion of the stock market even while global economic growth has slumped.
While the wealth of the rich is growing at a breakneck pace, there is a stratification of growth within the super wealthy, skewed towards the very top.
In 2014, those with over $100 million in private wealth saw their wealth increase 11 percent in one year alone. Collectively, these households owned $10 trillion in 2014, 6 percent of the world’s private wealth. According to the report, “This top segment is expected to be the fastest growing, in both the number of households and total wealth.” They are expected to see 12 percent compound growth on their wealth in the next five years.
Those families with wealth between $20 and $100 million also rose substantially in 2014—seeing a 34 percent increase in their wealth in twelve short months. They now own $9 trillion. In five years they will surpass $14 trillion according to the report.
Coming in last in the “high net worth” population are those with between $1 million and $20 million in private wealth. These households are expected to see their wealth grow by 7.2 percent each year, going from $49 trillion to $70.1 trillion dollars, several percentage points below the highest bracket’s 12 percent growth rate.
The gains in private wealth of the ultra-rich stand in sharp contrast to the experience of billions of people around the globe. While wealth accumulation has sharply sped up for the ultra-wealthy, the vast majority of people have not even begun to recover from the past recession.
An Oxfam report from January, for example, shows that the bottom 99 percent of the world’s population went from having about 56 percent of the world’s wealth in 2010 to having 52 percent of it in 2014. Meanwhile the top 1 percent saw its wealth rise from 44 to 48 percent of the world’s wealth.
In 2014 the Russell Sage Foundation found that between 2003 and 2013, the median household net worth of those in the United States fell from $87,992 to $56,335—a drop of 36 percent. While the rich also saw their wealth drop during the recession, they are more than making that money back. Between 2009 and 2012, 95 percent of all the income gains in the US went to the top 1 percent. This is the most distorted post-recession income gain on record.
As the Organization for Economic Co-operation and Development (OECD) has noted, in the United States “between 2007 and 2013, net wealth fell on average 2.3 percent, but it fell ten-times more (26 percent) for those at the bottom 20 percent of the distribution.” The 2015 report concludes that “low-income households have not benefited at all from income growth.”
Another report by Knight Frank, looks at those with wealth exceeding $30 million. The report notes that in 2014 these 172,850 ultra-high-net-worth individuals increased their collective wealth by $700 billion. Their total wealth now rests at $20.8 trillion.
The report also draws attention to the disconnection between the rich and the actual economy. It states that the growth of this ultra-wealthy population “came despite weaker-than-anticipated global economic growth. During 2014 the IMF was forced to downgrade its forecast increase for world output from 3.7 percent to 3.3 percent.”
THE CRONY CLASS:
OBAMACLINTONOMICS was created by BILLARY CLINTON!
Income inequality grows FOUR TIMES FASTER under Obama than Bush.
“By the time of Bill Clinton’s election in 1992, the Democratic Party had completely repudiated its association with the reforms of the New Deal and Great Society periods. Clinton gutted welfare programs to provide an ample supply of cheap labor for the rich (WHICH NOW MEANS OPEN BORDERS AND NO E-VERIFY!), including a growing layer of black capitalists, and passed the 1994 Federal Crime Bill, with its notorious “three strikes” provision that has helped create the largest prison population in the world.”
“Calling income and wealth inequality the "great moral issue of our time," Sanders laid out a sweeping, almost unimaginably expensive program to transfer wealth from the richest Americans to the poor and middle class. A $1 trillion public works program to create "13 million good-paying jobs." A $15-an-hour federal minimum wage. "Pay equity" for women. Paid sick leave and vacation for everyone. Higher taxes on the wealthy. Free tuition at all public colleges and universities. A Medicare-for-all single-payer health care system. Expanded Social Security benefits. Universal pre-K.” WASHINGTON EXAMINER
OBAMA’S WALL STREET and the LOOTING of AMERICA – SECOND TERM
The corporate cash hoard has likewise reached a new record, hitting an estimated $1.79 trillion in the fourth quarter of last year, up from $1.77 trillion in the previous quarter. Instead of investing the money, however, companies are using it to buy back their own stock and pay out record dividends.
Megan McArdle Discusses How America's Elites Are Rigging the Rules - Newsweek/The Daily Beast special correspondent Megan McArdle joins Scott Rasmussen for a discussion on America's new Mandarin class.
OBAMA’S CRONY CAPITALISM
A NATION RULED BY CRIMINAL WALL STREET BANKSTERS AND OBAMA DONORS
OBAMANOMICS: IS IT WORKING???
Millionaires projected to own 46 percent of global private wealth by 2019
By Gabriel Black
18 June 2015
Households with more than a million (US) dollars in private wealth are projected to own 46 percent of global private wealth in 2019 according to a new report by the Boston Consulting Group (BCG).
This large percentage, however, only includes cash, savings, money market funds and listed securities held through managed investments—collectively known as “private wealth.” It leaves out businesses, residences and luxury goods, which comprise a substantial portion of the rich’s net worth.
At the end of 2014, millionaire households owned about 41 percent of global private wealth, according to BCG. This means that collectively these 17 million households owned roughly $67.24 trillion in liquid assets, or about $4 million per household.
In total, the world added $17.5 trillion of new private wealth between 2013 and 2014. The report notes that nearly three quarters of all these gains came from previously existing wealth. In other words, the vast majority of money gained has been due to pre-existing assets increasing in value—not the creation of new material things.
This trend is the result of the massive infusions of cheap credit into the financial markets by central banks. The policy of “quantitative easing” has led to a dramatic expansion of the stock market even while global economic growth has slumped.
While the wealth of the rich is growing at a breakneck pace, there is a stratification of growth within the super wealthy, skewed towards the very top.
In 2014, those with over $100 million in private wealth saw their wealth increase 11 percent in one year alone. Collectively, these households owned $10 trillion in 2014, 6 percent of the world’s private wealth. According to the report, “This top segment is expected to be the fastest growing, in both the number of households and total wealth.” They are expected to see 12 percent compound growth on their wealth in the next five years.
Those families with wealth between $20 and $100 million also rose substantially in 2014—seeing a 34 percent increase in their wealth in twelve short months. They now own $9 trillion. In five years they will surpass $14 trillion according to the report.
Coming in last in the “high net worth” population are those with between $1 million and $20 million in private wealth. These households are expected to see their wealth grow by 7.2 percent each year, going from $49 trillion to $70.1 trillion dollars, several percentage points below the highest bracket’s 12 percent growth rate.
The gains in private wealth of the ultra-rich stand in sharp contrast to the experience of billions of people around the globe. While wealth accumulation has sharply sped up for the ultra-wealthy, the vast majority of people have not even begun to recover from the past recession.
An Oxfam report from January, for example, shows that the bottom 99 percent of the world’s population went from having about 56 percent of the world’s wealth in 2010 to having 52 percent of it in 2014. Meanwhile the top 1 percent saw its wealth rise from 44 to 48 percent of the world’s wealth.
In 2014 the Russell Sage Foundation found that between 2003 and 2013, the median household net worth of those in the United States fell from $87,992 to $56,335—a drop of 36 percent. While the rich also saw their wealth drop during the recession, they are more than making that money back. Between 2009 and 2012, 95 percent of all the income gains in the US went to the top 1 percent. This is the most distorted post-recession income gain on record.
As the Organization for Economic Co-operation and Development (OECD) has noted, in the United States “between 2007 and 2013, net wealth fell on average 2.3 percent, but it fell ten-times more (26 percent) for those at the bottom 20 percent of the distribution.” The 2015 report concludes that “low-income households have not benefited at all from income growth.”
Another report by Knight Frank, looks at those with wealth exceeding $30 million. The report notes that in 2014 these 172,850 ultra-high-net-worth individuals increased their collective wealth by $700 billion. Their total wealth now rests at $20.8 trillion.
The report also draws attention to the disconnection between the rich and the actual economy. It states that the growth of this ultra-wealthy population “came despite weaker-than-anticipated global economic growth. During 2014 the IMF was forced to downgrade its forecast increase for world output from 3.7 percent to 3.3 percent.”
OBAMA-CLINTONomics: the never end war on the American middle-class. But we still get the tax bills for the looting of their Wall Street cronies and their bailouts and billions for Mexico’s welfare state in our borders.
While the wealth of the rich is growing at a breakneck pace, there is a stratification of growth within the super wealthy, skewed towards the very top.
In 2014, those with over $100 million in private wealth saw their wealth increase 11 percent in one year alone. Collectively, these households owned $10 trillion in 2014, 6 percent of the world’s private wealth. According to the report, “This top segment is expected to be the fastest growing, in both the number of households and total wealth.” They are expected to see 12 percent compound growth on their wealth in the next five years.
In 2014 the Russell Sage Foundation found that between
2003 and 2013, the median household net worth of those in
the United States fell from $87,992 to $56,335—a drop of 36
percent. While the rich also saw their wealth drop during the
recession, they are more than making that money back.
Between 2009 and 2012, 95 percent of all the income gains in
the US went to the top 1 percent. This is the most distorted
post-recession income gain on record.
INCOME PLUMMETS UNDER OBAMA AND HIS WALL STREET CRONIES
collapse of household income in the US… STILL BILLIONS IN WELFARE HANDED TO ILLEGALS… they already get our jobs and are voting for more!
INCOME PLUMMETS UNDER OBAMA… most jobs go to illegals.
AS HIS CRONY BANKSTERS CONTINUE TO LOOT,
INCOMES PLUMMET FOR AMERICANS (LEGALS).
GOOD TIME FOR AMNESTY FOR MILLIONS OF LOOTING MEXICANS?
MORE HERE:
http://mexicanoccupation.blogspot.com/2014/09/and-still-democrat-party-wants-millions.html
“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 documents a sharp decline in working class living standards and a further concentration of wealth in the hands of the rich and the super-rich.”
"During the month, some 432,000 people in
the US gave up looking for a job."
"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."
HILLARY CLINTON'S BIGGEST DONORS ARE OBAMA'S CRIMINAL CRONY BANKSTERS!
"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."
Federal Reserve documents stagnant state of
Federal Reserve documents stagnant state of US economy
The US Federal Reserve Board last week released its semiannual Monetary Policy Report to Congress, providing an assessment of the state of the American economy and outlining the central bank’s monetary policy going forward. The report, along with Fed Chair Janet Yellen’s testimony before both the House of Representatives and the Senate, as well as a speech by Yellen the previous week in Cleveland, present a grim picture of the reality behind the official talk of economic “recovery.”
In her prepared remarks to Congress last Wednesday and Thursday, Yellen said, “Looking forward, prospects are favorable for further improvement in the US labor market and the economy more broadly.”
She reiterated her assurances that while the Fed would likely begin to raise its benchmark federal funds interest rate later this year from the 0.0 to 0.25 percent level it has maintained since shortly after the 2008 financial crash, it would do so only slowly and gradually, keeping short-term rates well below historically normal levels for an indefinite period.This was an expected, but nevertheless welcome, signal to the American financial elite, which has enjoyed a spectacular rise in corporate profits, stock values and personal wealth since 2009 thanks to the flood of virtually free money provided by the Fed.
"But as Yellen’s remarks and the Fed report indicate, the explosion of asset values and wealth accumulation at the very top of the economic ladder has occurred alongside an intractable and continuing slump in the real economy."In her prepared testimony to the House Financial Services Committee and the Senate Banking Committee, Yellen noted the following features of the performance of the US economy over the first six months of 2015:
* A sharp decline in the rate of economic growth as compared to 2014, including an actual contraction in the first quarter of the year.
* A substantial slackening (19 percent) in average monthly job-creation, from 260,000 last year to 210,000 thus far in 2015.
* Declines in domestic spending and industrial production.
In her July 10 speech to the City Club of Cleveland, Yellen cited an even longer list of negative indices, including:
* Growth in real gross domestic product (GDP) since the official beginning of the recovery in June, 2009 has averaged a mere 2.25 percent per year, a full one percentage point less than the average rate over the 25 years preceding what Yellen called the “Great Recession.”
* While manufacturing employment nationwide has increased by about 850,000 since the end of 2009, there are still almost 1.5 million fewer manufacturing jobs than just before the recession.
* Real GDP and industrial production both declined in the first quarter of this year. Industrial production continued to fall in April and May.
* Residential construction (despite extremely low mortgage rates by historical standards) has remained “quote soft.”
* Productivity growth has been “weak,” largely because “Business owners and managers… have not substantially increased their capital expenditures,” and “Businesses are holding large amounts of cash on their balance sheets.”
* Reflecting the general stagnation and even slump in the real economy, core inflation rose by only 1.2 percent over the past 12 months.
The Monetary Policy Report issued by the Fed includes facts that are, if anything, even more alarming, including:
* “Labor productivity in the business sector is reported to have declined in both the fourth quarter of 2014 and the first quarter of 2015.”
* “Exports fell markedly in the first quarter, held back by lackluster growth abroad.”
* “Overall construction activity remains well below its pre-recession levels.”
* “Since the recession began, the gains in… nominal compensation [workers’ wages and benefits] have fallen well short of their pre-recession averages, and growth of real compensation has fallen short of productivity growth over much of this period.”
* “Overall business investment has turned down as investment in the energy sector has plunged. Business investment fell at an annual rate of 2 percent in first quarter… Business outlays for structures outside of the energy sector also declined in the first quarter…”
The report incorporates the Fed’s projections for US economic growth, published following the June meeting of the central bank’s policy-setting Federal Open Market Committee. They include a downward revision of the projection for 2015 to 1.8 percent-2.0 percent from the March projection of 2.3 percent to 2.7 percent.
That the US economy continues to stagnate and even contract is indicated by two surveys released last week while Yellen was testifying before Congress. The Fed reported that factory production failed to increase in June for the second straight month and output in the auto sector fell 3.7 percent. The Commerce Department reported that retail sales unexpectedly fell in June, declining by 0.3 percent.
These statistics follow the employment report for June, which showed that the share of the US working-age population either employed or actively looking for work, known as the labor force participation rate, fell to 62.6 percent, its lowest level in 38 years. During the month, some 432,000 people in the US gave up looking for a job.
The disastrous figures on business investment are perhaps the most telling indicators of the underlying crisis of the capitalist system. The Fed report attributes the sharp decline so far this year primarily to the dramatic fall in oil prices and resulting contraction in investment and construction in the energy sector. But the plunge in oil prices is itself a symptom of a general slowdown in the world economy.
Moreover, a dramatic decline in productive investment is common to all of the major industrialized economies of Europe and North America. In its World Economic Outlook of last April, the International Monetary Fund for the first time since the 2008 financial crisis acknowledged that there was no prospect for an early return to pre-recession levels of economic growth, linking this bleak prognosis to a general and pronounced decline in productive investment.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.
The economic crisis in the US and internationally is not simply a conjunctural downturn. It is a systemic crisis of global capitalism, centered in the US. 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.
While the economy is starved of productive investment, entirely parasitic and socially destructive activities such as stock buybacks, dividend hikes and mergers and acquisitions return to pre-crash levels and head for new heights. US corporations have spent more on stock buybacks so far this year than on factories and equipment.
In her prepared remarks to Congress last Wednesday and Thursday, Yellen said, “Looking forward, prospects are favorable for further improvement in the US labor market and the economy more broadly.”
She reiterated her assurances that while the Fed would likely begin to raise its benchmark federal funds interest rate later this year from the 0.0 to 0.25 percent level it has maintained since shortly after the 2008 financial crash, it would do so only slowly and gradually, keeping short-term rates well below historically normal levels for an indefinite period.This was an expected, but nevertheless welcome, signal to the American financial elite, which has enjoyed a spectacular rise in corporate profits, stock values and personal wealth since 2009 thanks to the flood of virtually free money provided by the Fed.
"But as Yellen’s remarks and the Fed report indicate, the explosion of asset values and wealth accumulation at the very top of the economic ladder has occurred alongside an intractable and continuing slump in the real economy."In her prepared testimony to the House Financial Services Committee and the Senate Banking Committee, Yellen noted the following features of the performance of the US economy over the first six months of 2015:
* A sharp decline in the rate of economic growth as compared to 2014, including an actual contraction in the first quarter of the year.
* A substantial slackening (19 percent) in average monthly job-creation, from 260,000 last year to 210,000 thus far in 2015.
* Declines in domestic spending and industrial production.
In her July 10 speech to the City Club of Cleveland, Yellen cited an even longer list of negative indices, including:
* Growth in real gross domestic product (GDP) since the official beginning of the recovery in June, 2009 has averaged a mere 2.25 percent per year, a full one percentage point less than the average rate over the 25 years preceding what Yellen called the “Great Recession.”
* While manufacturing employment nationwide has increased by about 850,000 since the end of 2009, there are still almost 1.5 million fewer manufacturing jobs than just before the recession.
* Real GDP and industrial production both declined in the first quarter of this year. Industrial production continued to fall in April and May.
* Residential construction (despite extremely low mortgage rates by historical standards) has remained “quote soft.”
* Productivity growth has been “weak,” largely because “Business owners and managers… have not substantially increased their capital expenditures,” and “Businesses are holding large amounts of cash on their balance sheets.”
* Reflecting the general stagnation and even slump in the real economy, core inflation rose by only 1.2 percent over the past 12 months.
The Monetary Policy Report issued by the Fed includes facts that are, if anything, even more alarming, including:
* “Labor productivity in the business sector is reported to have declined in both the fourth quarter of 2014 and the first quarter of 2015.”
* “Exports fell markedly in the first quarter, held back by lackluster growth abroad.”
* “Overall construction activity remains well below its pre-recession levels.”
* “Since the recession began, the gains in… nominal compensation [workers’ wages and benefits] have fallen well short of their pre-recession averages, and growth of real compensation has fallen short of productivity growth over much of this period.”
* “Overall business investment has turned down as investment in the energy sector has plunged. Business investment fell at an annual rate of 2 percent in first quarter… Business outlays for structures outside of the energy sector also declined in the first quarter…”
The report incorporates the Fed’s projections for US economic growth, published following the June meeting of the central bank’s policy-setting Federal Open Market Committee. They include a downward revision of the projection for 2015 to 1.8 percent-2.0 percent from the March projection of 2.3 percent to 2.7 percent.
That the US economy continues to stagnate and even contract is indicated by two surveys released last week while Yellen was testifying before Congress. The Fed reported that factory production failed to increase in June for the second straight month and output in the auto sector fell 3.7 percent. The Commerce Department reported that retail sales unexpectedly fell in June, declining by 0.3 percent.
These statistics follow the employment report for June, which showed that the share of the US working-age population either employed or actively looking for work, known as the labor force participation rate, fell to 62.6 percent, its lowest level in 38 years. During the month, some 432,000 people in the US gave up looking for a job.
The disastrous figures on business investment are perhaps the most telling indicators of the underlying crisis of the capitalist system. The Fed report attributes the sharp decline so far this year primarily to the dramatic fall in oil prices and resulting contraction in investment and construction in the energy sector. But the plunge in oil prices is itself a symptom of a general slowdown in the world economy.
Moreover, a dramatic decline in productive investment is common to all of the major industrialized economies of Europe and North America. In its World Economic Outlook of last April, the International Monetary Fund for the first time since the 2008 financial crisis acknowledged that there was no prospect for an early return to pre-recession levels of economic growth, linking this bleak prognosis to a general and pronounced decline in productive investment.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.
The economic crisis in the US and internationally is not simply a conjunctural downturn. It is a systemic crisis of global capitalism, centered in the US. 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.
While the economy is starved of productive investment, entirely parasitic and socially destructive activities such as stock buybacks, dividend hikes and mergers and acquisitions return to pre-crash levels and head for new heights. US corporations have spent more on stock buybacks so far this year than on factories and equipment.
The intractable nature of this crisis, within the framework of capitalism, is underscored by the IMF’s updated World Economic Outlook, released earlier this month, which projects that 2015 will be the worst year for economic growth since the height of the recession in 2009.
DESTROYING AMERICAN ONE INVADING ILLEGAL AT A TIME…
IS THE U.S. CHAMBER OF COMMERCE
THE GREATEST ENEMY OF THE
THE GREATEST ENEMY OF THE
AMERICAN (Legal) WORKER?
What this means is that what is good for Main Street will not be good for Wall Street and Big Biz, at least not in the short run. What benefits the American worker -- fair trade policy and tight immigration control -- will initially hurt Big Biz and Wall Street.
Chicago’s Hemorrhaging Housing Market
High taxes and government debt have soured buyers on Illinois and the nation’s third-largest city.Spring 2019
Cities
Economy, finance, and budgets
In early 2012, Chicago mayor Rahm Emanuel warned residents and local politicians that, unless the city, along with the state of Illinois, started tackling its deep pension problems, “You won’t recruit a business, you won’t recruit a family to live here.” Seven years later, as Emanuel exits office, it’s becoming clearer what he meant.
A few months ago, Realtor.com predicted that
Chicago would have the weakest housing activity
this year among the nation’s top 100 markets.
Average housing prices in the Windy City still haven’t completely recovered from the real-estate downturn that began in 2009, though property taxes continue to climb. No wonder, then, that Illinois ranks among states losing the most people to other areas of the country, or that some Chicago-area homeowners are taking big losses when they sell their houses. The future doesn’t look brighter. “Taxes are high, the services [that taxes] pay for are terrible, and the debt load is so high, so palpably unsustainable that people have no belief that the resources can be found to turn it all around,” Ball State economist Michael Hicks told the local press last year.
Government-employee unions have pushed legislation that gradually forces local municipalities to ramp up pension contributions, even as efforts to control retirement-system costs have sputtered. The result: higher taxes. Chicago’s annual pension payments have doubled over the last few years, to nearly $1.2 billion, and are set to rise to $2 billion within three years. In 2015, the city passed $543 million in property-tax increases, phased in over three years, to pay for the burden. Every penny that the city collects in property taxes goes into the pension system. The financially troubled Chicago school system has also been raising its share of local homeowner taxes, including a $224 million hike in the 2017 school year. The combined bite now gives Chicago among the highest residential property-tax rates of any American city.
As taxes soar, residents are leaving Illinois and its largest city. From 2011 through 2017, Illinois ranked second among the states in net domestic outmigration, losing 640,000 more residents than it gained from other states, according to a study by demographer Wendell Cox. Chicago is a big reason. A recent Bloomberg study of metropolitan-area migration data found that the city had a net migration loss of 105,000 in 2014; it got worse in 2017, with the net loss totaling 155,000. Governors of some high-tax states, like New York’s Andrew Cuomo, have acknowledged the role that tax increases play in driving residents out, but in Illinois, new governor Jay Pritzker has proposed changing the state’s constitution so that he can institute a progressive income tax on the wealthy—giving them extra incentives to go somewhere else.
It isn’t just the wealthy, who tend to be older, leaving. A new study by demographer William Frey of the migration patterns of millennials (those aged 22 to 38) found that Chicago ranks as the third-least attractive among the nation’s 53 largest metro areas, losing an average of nearly 19,000 more young adults than it gains every year. Those losses account for the bulk of millennial flight from Illinois, which similarly ranks below all but two states in trying to attract young adults. One problem is the flagging local economy. Despite big real-estate deals that have pushed up commercial rents in the Loop, the greater Chicago metro region has averaged less than 1 percent growth in private-sector jobs in each of the last two years.
Every homeowner leaving Illinois puts a house on the market without buying another one locally. That’s one reason the Chicago marketplace is struggling. The average price of a single-family home in Chicago is lower than it was before prices began plunging back in 2009. Nationwide, by contrast, home prices are 30 percent higher than before the crash. One consequence of the lagging recovery is that Chicago has more homes with underwater mortgages—that is, the mortgage is greater than the value of the home—than any other major market. As many as 135,000 of these homeowners may risk default when the next recession hits and prices plummet again. Homeowners are feeling the pinch in other ways, too; local papers are filled with stories of people regretting their investment in a house. Last year, Crain’s Chicago Business told the story of a Chicago-area executive who lost more than half a million on the sale of his home when he retired to move elsewhere. If he had invested the money in the stock market instead, he said, “I’d probably have $6 million now.”
For years, voters in some states have acted as if government financial problems, including massive pension debt, weren’t real. Everything would work out somehow, they seemed to believe. Take a look at Illinois and the nation’s third-largest city to see how that bet is playing out.
Chicago’s Hemorrhaging Housing Market
High taxes and government debt have soured buyers on Illinois and the nation’s third-largest city.Spring 2019
Cities
Economy, finance, and budgets
In early 2012, Chicago mayor Rahm Emanuel warned residents and local politicians that, unless the city, along with the state of Illinois, started tackling its deep pension problems, “You won’t recruit a business, you won’t recruit a family to live here.” Seven years later, as Emanuel exits office, it’s becoming clearer what he meant.
A few months ago, Realtor.com predicted
that Chicago would have the weakest
housing activity this year among the nation’s
top 100 markets.
that Chicago would have the weakest
housing activity this year among the nation’s
top 100 markets.
Average housing prices in the Windy City still haven’t completely recovered from the real-estate downturn that began in 2009, though property taxes continue to climb. No wonder, then, that Illinois ranks among states losing the most people to other areas of the country, or that some Chicago-area homeowners are taking big losses when they sell their houses. The future doesn’t look brighter. “Taxes are high, the services [that taxes] pay for are terrible, and the debt load is so high, so palpably unsustainable that people have no belief that the resources can be found to turn it all around,” Ball State economist Michael Hicks told the local press last year.
Government-employee unions have pushed legislation that gradually forces local municipalities to ramp up pension contributions, even as efforts to control retirement-system costs have sputtered. The result: higher taxes. Chicago’s annual pension payments have doubled over the last few years, to nearly $1.2 billion, and are set to rise to $2 billion within three years. In 2015, the city passed $543 million in property-tax increases, phased in over three years, to pay for the burden. Every penny that the city collects in property taxes goes into the pension system. The financially troubled Chicago school system has also been raising its share of local homeowner taxes, including a $224 million hike in the 2017 school year. The combined bite now gives Chicago among the highest residential property-tax rates of any American city.
As taxes soar, residents are leaving Illinois and its largest city. From 2011 through 2017, Illinois ranked second among the states in net domestic outmigration, losing 640,000 more residents than it gained from other states, according to a study by demographer Wendell Cox. Chicago is a big reason. A recent Bloomberg study of metropolitan-area migration data found that the city had a net migration loss of 105,000 in 2014; it got worse in 2017, with the net loss totaling 155,000. Governors of some high-tax states, like New York’s Andrew Cuomo, have acknowledged the role that tax increases play in driving residents out, but in Illinois, new governor Jay Pritzker has proposed changing the state’s constitution so that he can institute a progressive income tax on the wealthy—giving them extra incentives to go somewhere else.
It isn’t just the wealthy, who tend to be older, leaving. A new study by demographer William Frey of the migration patterns of millennials (those aged 22 to 38) found that Chicago ranks as the third-least attractive among the nation’s 53 largest metro areas, losing an average of nearly 19,000 more young adults than it gains every year. Those losses account for the bulk of millennial flight from Illinois, which similarly ranks below all but two states in trying to attract young adults. One problem is the flagging local economy. Despite big real-estate deals that have pushed up commercial rents in the Loop, the greater Chicago metro region has averaged less than 1 percent growth in private-sector jobs in each of the last two years.
Every homeowner leaving Illinois puts a house on the market without buying another one locally. That’s one reason the Chicago marketplace is struggling. The average price of a single-family home in Chicago is lower than it was before prices began plunging back in 2009. Nationwide, by contrast, home prices are 30 percent higher than before the crash. One consequence of the lagging recovery is that Chicago has more homes with underwater mortgages—that is, the mortgage is greater than the value of the home—than any other major market. As many as 135,000 of these homeowners may risk default when the next recession hits and prices plummet again. Homeowners are feeling the pinch in other ways, too; local papers are filled with stories of people regretting their investment in a house. Last year, Crain’s Chicago Business told the story of a Chicago-area executive who lost more than half a million on the sale of his home when he retired to move elsewhere. If he had invested the money in the stock market instead, he said, “I’d probably have $6 million now.”
For years, voters in some states have acted as if government financial problems, including massive pension debt, weren’t real. Everything would work out somehow, they seemed to believe. Take a look at Illinois and the nation’s third-largest city to see how that bet is playing out.
No comments:
Post a Comment