Tag: Wealth Inequality

  Many people view the Federal Reserve’s role in monetary policy as an unqualified good. If there isn’t enough money in the economy, or if there is too much debt or deflation, then the Fed should print money until both situations are fixed.

  Simple.

 But it isn’t that simple.

Monetary policy is a zero-sum game. It’s much like Isaac Newton’s 3rd law of motion: for every action there is an equal and opposite reaction.

  Not only do many people fail to understand that, they are also under false impressions of what the reactions are and who they effect.

  How much is a life worth? How much would it cost you to run over someone with a car and leave them for dead?

 It’s not a question you will ever have to answer, unless you are very wealthy.

 Martin Joel Erzinger, who manages more than $1 billion in assets for Morgan Stanley in Denver, is being accused only of a misdemeanor for allegedly driving his Mercedes into a cyclist and then fleeing the scene, Colorado’s Vail Daily reports. The victim, Dr. Steven Milo, whom Erzinger allegedly hit in July, suffered spinal cord injuries, bleeding from his brain and, according to his lawyer Harold Haddon, “lifetime pain.”

  But District Attorney Mark Hurlbert says it wouldn’t be wise to prosecute Erzinger — doing so might hurt his source of income.

 Lord knows we don’t want to endanger the critical job of managing wealth for the uber-wealthy.

  The financial crisis that grips our nation’s states and cities has a malicious source, and Governor Tim Pawlenty recently named that source: public school teachers.

 “It used to be that public employees were underpaid and over-benefited. Now they are over-benefited and overpaid compared to their private-sector counterparts.”

 The school teacher, the policeman, the firefighter – these are now the faces of what is wrong with America today. It doesn’t matter that studies by the Bureau of Labor Statistics say otherwise, America can no longer afford their overpaid, middle-class salaries.

  At least that is what the right-wing media is telling us. Tea party members also want to see a drastic pay cut for the same people who teach their children. A familiar comment on the internet is, “I took a pay cut last year. Why shouldn’t they?”

  This attitude goes beyond schadenfreude and goes straight to the crabs in a bucket mentality. Strangely enough this attitude of “if I can’t have it, neither should you” only extends to working class people who live next door. For some reason none of the jealousy and malice is reserved for the people who actually broke the budgets of the states and cities, i.e. the people who deserve it.

Warren Buffet gave a prophetic pronouncement back in 2003 about the Derivatives market, seeing the exponential dangers of this “paper-thin” type of investment.

Buffet did not mince words. He called them “financial weapons of mass destruction“:

Buffett warns on investment ‘time bomb’

BBC – 4 March, 2003

The derivatives market has exploded in recent years, with investment banks selling billions of dollars worth of these investments to clients as a way to off-load or manage market risk.

But Mr Buffett argues that such highly complex financial instruments are time bombs and “financial weapons of mass destruction” that could harm not only their buyers and sellers, but the whole economic system.

[…]

Some derivatives contracts, Mr Buffett says, appear to have been devised by “madmen”.  […]

http://news.bbc.co.uk/2/hi/bus…

Apparently many workers in China would — for how much longer though is not entirely clear.  You see the Chinese, want to make more, improve the Standard of Living for their families — just like Americans and Europeans do.

http://iws.punahou.edu/user/JS…

8-12% Raises in Minimum Wages across China, in 2005!?

Apparently, Workers around the World, AREN’T Working just for the Fun of it!

This new trend toward leveling the the Global playing field, doesn’t bode well for the Wal-Marts of the world, who rely on such “captured cheap labor markets” —

to remain quiet, dutiful, and

happy with a pittance.

Afterall Billions of Dollars (and Euros) are at stake — those Foreign Workers must not upset that Apple cart.

They should just be happy they have a Job!

Shouldn’t they?

If you missed Dylan Ratigan’s interview today with Senator Maria Cantwell (D-WA) — well you missed a lot!

They spell out in stark relief the very REAL need for serious Wall Street Regulation — NOW!   (and still!)

Or we risk a repeat of the same Bubble-driven collapse of Trillion Dollar Derivative Bets, that occur in the dark, beyond the reach — or even the Watch — of any Govt Regulator, or even the Public scrutinity.

Nothing has changed, they can STILL Gamble Trillions in Derivatives, and let US the Taxpayers pick up the Tab, whenever their Bets GO Bad!

Link to MSNBC Clip to the Ratigan Cantwell Interview

Definitely a “Must See”, in my opinion.

So much so, I transcribed much of it, to help peak your interest …  

FRONTLINE INVESTIGATES THE ROOTS OF THE FINANCIAL CRISIS

FRONTLINE Presents

The Warning

Tuesday, October 20, 2009, at 9 P.M. ET on PBS

In the devastating aftermath of the economic meltdown, FRONTLINE sifts through the ashes for clues about why it happened and examines critical moments when it might have gone much differently.

In The Warning, airing Tuesday, Oct. 20, 2009, at 9 P.M. ET on PBS (check local listings), veteran FRONTLINE producer Michael Kirk (Inside the Meltdown, Breaking the Bank) unearths the hidden history of the nation’s worst financial crisis since the Great Depression. At the center of it all he finds Brooksley Born, who speaks for the first time on television about her failed campaign to regulate the secretive, multi-trillion-dollar derivatives market whose crash helped trigger the financial collapse in the fall of 2008.

http://www.pbs.org/wgbh/pages/…

The Center on Budget and Policy Priorities economists just confirmed the trends of the last 8 years — Most of the the Economic Gains went to the very Wealthy, while the rest of us struggled to just get by

TOP 1 PERCENT OF AMERICANS REAPED 2/3 OF INCOME GAINS In last Economic Expansion,

Income Concentration in 2007 Was at Highest Level Since 1928, New Analysis Shows

By Avi Feller and Chad Stone – September 9, 2009

Two-thirds of the nation’s total income gains from 2002 to 2007 flowed to the top 1 percent of U.S. households, and that top 1 percent held a larger share of income in 2007 than at any time since 1928, according to an analysis of newly released IRS data by economists Thomas Piketty and Emmanuel Saez.

During those years, the Piketty-Saez data also show, the inflation adjusted income of the top 1 percent of households grew more than ten times faster than the income of the bottom 90 percent of households.

There is a clash of titan forces taking place in the American Economy right now. It’s a tale as old as Greed itself.  

It is the tale of the “Powers that Be” running into the watchful eyes of the “World that Should Be”.

The story involves how corporate Robber Barons avoid the watchful glare of the citizen Muckrakers.  

It is the tale of Deception and Greed vs Honesty and Fairness …

I’m just back from seeing Michael Moore’s new movie, “Capitalism – A Love Story”.

It was moving, funny, and educational, all rolled into one. It made me feel both, proud and sad, to be an American. … but it’s recommended viewing if you still want to take OUR Country back, from the Powers that Be.

There are many lessons to be learned from the film — But the one that struck me, the one I’m motivated to write about now —

Is the Lesson of Plutonomy …