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September 22, 2011

1

Idiocracy

by beaufou


The message from the Federal Reserve yesterday was blunt, interest rates are at zero, mortgage rates at a 60 year low and there is nothing more they can do. Throwing another trillion at Wall Street in the shape of Quantitative Easing is not going to do the trick, it has already failed twice.
The economy is still slowing down flirting with recession, the job market is awful with rounds of layoffs still to come and the housing market is depressed to say the least…nothing is moving and many of us predicted it months ago.
Politicians in Washington are still promoting the austerity nonsense, what else can you expect from a crowd who have been consistently been doing the opposite of what they should have done.
They have cut taxes during war times and increased Government spending during an expanding cycle, and now, those geniuses are doing the exact opposite.
We are in a completely different environment nowadays where deficits have to be ignored while the real economy – the one that creates jobs, not income inequality – recovers.
There are many factors to be considered; income inequality has grown at a rapid rate over the last few decades due to the fact that the financial world has taken over the economy, producing illusionary profits, ill gotten gains, while destroying the job market – outsourcing and restructuring to augment their investors returns -.
Corporations who are paying elected officials handsomely to spread their disease have created zero jobs in the last ten years while claiming they need tax breaks because they are the so-called “job creators”, nothing could be farther from the truth.
Rounds of easy money, created by the Federal Reserve, thrown at bankers and financial institutions have depreciated the dollar by 40% since 2002 while salaries have been stagnant for 90% of Americans, oil and food prices have sky rocketed because of speculation, the demand is actually lower in times of recession with consumers deleveraging and obviously driving/spending less.
Never mind, the media circus and the White House are now parading Warren Buffett as our savior, what has this man produced in his life other than amass an immense fortune out of speculating, the question we should be asking is why is Warren Buffett still making money?
the answer is here, he may pay a little more taxes, but he won’t forget to make the real economy pay for it.
The Koch brothers, the oil billionaires who have generously brought us the Tea Party are now worth $50 billion, they are however opposed to raising taxes on the rich, job creators.

Excess government stimulus during expansions and austerity during (or immediately after) contractions is simply misguided economics, bad politics and awful policy.

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1 Comment Post a comment
  1. Sep 22 2011

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