What has been drumming like a silent but insistent drummer in the back of my mind is this thought that I have
six months to somehow prepare myself for the next phase of economic
collapse. What's been going on is I have been reading for the past two years all I could on the structure of
of this present economic system. It has been revealing and I have learned to take the mainstream news with a large, large grain of salt. I have to cross check and reference everything in context.
One of the best sites I have found for life learning is The Khan Academy on You Tube. I can't recommend it highly enough. I started with the bank bailouts and worked myself up to Credit Default Swaps and went from there. Check it out.You won't be disappointed.
OK, so now theoretically everything is back to the "new normal". Is this economy on a slow trajectory leading up? It depends on where you stand. Some the effects we are seeing were started in the time of Carter, Reagan and preceded from there. The nation went Ronnie feel good back to yesterday rather than seriously considering Carters dour warnings. But that's a long story and Americans want sound bite.
For the top percentiles whose worth is made and increased in capital gains certainly the economy is roaring.
It is so good that they are accounting for a large percentage of retail spending. I don't have the metrics but when you hear the government say that retail spending is picking up I have to ask where and in what sector.
Here from your scribes position it's dog eat dog, always has been but the dogs are getting leaner and meaner.
Further, it is because of the TARP and bailout of the TBTF banks that corporate USA is having the record earnings, record profits, and stock buy-backs. It's all good you say. From the citadels of corporate America viewing the vast empire that is United States I would tend to agree. Nothing like a hungry, clawing for a job work force. The strong survive.
Well it is in the short term. I believe though that the economic situation of 2008 is far from over. We are in the drawing room phase. We as a nation have yet to enter the living room. There are some nasties that promise to be waiting with open karmic arms. Will Americans learn their history?
Just a few observations.
1. There has been no significant cleaning out of the banking system. The Wells Fargo, Chase, Morgan Stanley, Goldman Sachs are now right back in the game, bigger,more diversified. Still the Western system isn't cleaned out, the patches may hold may not.
This is supported by the wisdom of Carlos Slim, world's richest man who said in an interview that he didn't
trust the market right now and was taking measures to avoid loss.
Why would one of the richest capitalist's say such a thing? Wouldn't he be on the Wall Street cheering squad?
Further the government is mostly captured by these bank lobbies,the top dogs. We only have to look at how many top Treasury Officials and subordinates are connected to Goldman to see this plainly. Government Sachs. All about Progress...
Plus the former Chase VP handling information that come to and goes to the POTUS. Democracy Corporate 2.0
2.The Employment situation is all wrong. The figures are hardly even accurate when counting a true picture
since the Labor Department counts only current unemployed receiving benefits and all others drop off into the U-6 land. Of course U-6 is avoided by the positive patter of the sound bite US mainstream media. Go figure.
3.Derivatives are still out of control. While I don't understand the full scope of this it seems to be a possible mine field in the future.
Max Keiser, who incidentally invented the high frequency systems that make up 70% of trading is yelling about that a lot over on RT. What's going one here?
4. The QE program which is doing it's intended job to give a little inflation to the economy(and world economy,different story),creating a boost in asset prices on the Street. A wealth effect that does avoid the
"depression" that Ben Bernanke studied but it's not creating enough jobs. A lot of Americans are experiencing more inflation and so is the rest of the world. At income of $2.00 a day in Egypt how are you going to buy food? I have more in common with the people in Egypt than I know. The Fed is exporting losses.
The Fed has the option to stop QE, since employing QE-1,QE-2 and see interest rates rise thereby increasing the debt of the United States or keep up the QE and have serious dollar devaluation leading to possible destruction. I don't envy Ben. A largely consumer economy that has reduced it's production, manufacturing base. What happens when the credit dries up? Not pretty. All those Americans with guns and their "rights".
Would everybody stop for prayer as they did in Egypt? I suppose the Homeland Security has the plans laid.
5. Too much income disparity. We can't be a strong "winning the future" economy of janitors and CEO's. So
are the drones in DC going to realize that we are all in this together or do they think that just pulling up the drawbridge will keep the system intact? Do the DC Forbidden City types even realize there are serious situations of suffering and income destruction going on here?
Pull yourself up by the bootstraps doesn't work for those who can't afford boots.
The austerity brigade is right that we need to cut down in spending but what they fail to mention is that picking on the poor and most vulnerable is hardly going to inspire confidence. Not for happy workers.
Also even total cuts in all Social Security, Medicare, and poverty social safety net programs will only be a margin of the debt.How about reduction in benefits for Congress and Senate until the economy picks up?
As usual no mention is made of on-going foreign wars, war debts run up in Republican administrations, and the huge, huge military-industrial security state budget that keeps it all going. Plus tax give-away.
No one is disputing the fact of having a military, and intelligence ect. But I think the idea of using the military to prop up the dollar as reserve currency is going to become seriously tested. China, Russia focus on business, as in growing business. China which is expected to overtake us economically in 2016 has wisely stuck to it's own affairs. We haven't and we are paying literally through the nose.
Oh, and the Chinese Communist Party has pledged to raise the income standard for ALL chinese in a ten year plan. I have faith they will pull it off. No wars since I can remember there.
Still it could turn out just grand. Maybe kicking out boomers who paid into the "entitlement" is just their tough luck. Like Paul Ryan said we have all been in that hammock too long. He's so smart because attacking the least always makes for a great America. I love to wake up and see people diving into trash cans for their living. Don't you?
Maybe cutting education spending as China builds thirty or more universities a year is the only option. Let them live with debt forever Amen! Three jobs, how about four?
And I suppose that between American Idol, Jersey Shore and the infinite cable channel choices Americans can be entertained until the next shoe drops. CNBC/CNN/FOX will tell you how to think and observe the world. If you feel down just attack a (insert choice according to race, religion,socio-economic class)gay, liberal,immigrant,or homeless type. Fell better?
What the pretty bimbos of Fox and CNBC, CNN fail to tell us is......
This is basically a transfer(as better writers have said)of wealth from the middle classes to the wealthiest. Further, the US political system doesn't represent the average person. It can't the way it's structured right now. Basically Americans are reduced to begging their so-called leaders. The corporates rule.
What this leaves us with an unstable economy, debt that especially to China must be re-paid, and no one party proposing an economic plan that will employ and start up a mainstreet economy. All typical short-term knee jerk responses and no long term planning. It makes for desperate measures on the part of the elite and the common man/woman. I don't believe ignorance is bliss here.
Like I said, I feel in about five months there is going to be another event. A knock on the door. And to be prepared is key.
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