"The financial crisis in 2008 didn't stop the practice of economic management by printing money. Burning streets will.”
Andy Xie of Rosetta Stone Advisors, has written a particularly pessimistic piece of what the near economic future holds. He starts by making the case that North Africa unrest that has spilled over into the Middle East was touched off by economic issues like unemployment and rising prices. He ends by saying it could spread to Europe and the US.
In 2009, 14.3 percent Americans lived in poverty, according to the U.S. Census. Including ones that have given up on looking for a job, one sixth of American workers are underemployed or unemployed.
A huge chunk of American people have no cushion against massive increases in the cost of food and energy. In addition, the prices of imported consumer goods that low income Americans depend on are rising and are likely to rise much more, later in the year. Fifty million Americans are not so different from Egyptians in their economic plight. Riots could come to American cities. (Hot Money, Fast Riots)Here's a good explanation of the effects of inflation...
Inflation is redistributive, usually unfairly. First, low income people tend not to have debt, because they are usually not qualified to borrow from banks. When inflation surges, as it is happening now, their bank deposits erode in real value. Where do their losses go? The people who have debt and real assets like property speculators gain the same amount. Inflation essentially robs the poor and gives to the rich.Paul B. Farrell, pessimistic liberal investor, wonders when the revolution will start...
Second, low income people tend to have insecure jobs and cannot bargain wages up along with inflation, especially when inflation surges like now. The reduced purchasing power for their wages pushes them into an unsustainable situation. They simply cannot make ends meet. (Hot Money, Fast Riots)
Only a revolution will stop Wall Street’s self-destructive capitalism. And watching the people revolt against dictators like Mubarak and Gadhafi reminds us of the spirit that sparked America’s revolution in 1776.Farrell laments that it is too late to frog march the Wall Street banksters off to the slammer. Our corrupt political class lacks the will (and credibility) to do it anyway; they were co-conspirators. But he lists four factors that could cause a revolutionary explosion right here in the US of A:
Economist Peter Morici: “Capitalism is broken, America’s government is two bankrupt political parties bankrupting the country.”
BusinessWeek recently asked analyst Mary Meeker to run the numbers. How bad is it? America really is bankrupt, with a “net worth of a negative $44 trillion.” Bankrupt. (Paul B. Farrell)
Wealth gap, Wall Street immorality, Wars, World Population Explosion
The NY-DC Axis of Evil is raping and robbing us. When will we have enough?
12 comments:
Rape? Hardly.
The Malthusians, the whiners, the incompetent, the lazy, the uninitiated...always look for excuses to "riot", but the teevee calls like a siren song...
Since when has Wall Street been anything but immoral?
Same news, different day.
Riots in the US last long enough for the flat screen television sets to be stolen from the broken windows of economically depressed, crime ridden towns.
I agree about the lazy and immoral taking advantage of unrest to do smash and grabs, but wall street does it as well, just on a grander scale, and with government sanction.
Yes, they've always been greedy, but reading Forbes, Barrons, WSJ and other mainline business publications, all pretense of morality has been dropped, and it's a whole new level of greed.
Our treasury department and the fed are full of wall street people who take care of their own at our expense. As the article states, inflation and currency devaluation is legalized theft,
Most galling is DC backstopping them and building them safety nets with our money.
A riot isn't going to shut down the Federal Reserve. What's a civilized person to do?
I know that, and I'm not advocating violence.
We have the ballot box. Supporting people like Ron Paul, Rand Paul in their efforts to shut down the fed and end Wall Street subsidies would be a good start.
Like you, I don't fall for the whiners who say you can't make it in America, but we must also recognize how policies like "Quantitative Easing" (devaluing our currency) hurts everyone, especially the working poor.
And the co-conspirators of the NY Times says US economy better prepared for rising gas prices. A little different opinion than when they increased slightly after Katrina.
http://topics.nytimes.com/top/reference/timestopics/subjects/u/united_states_economy/index.html?query=NATURAL GAS&field=des&match=exact
In recent history, Americans have been rather politically complacent. Sure, there is this latest TEA Party thing, but it's a vague, uninspired movement that seems to be just a conservative reaction to social change, in particular, the election of the first black president - and a Democratic one with a funny name at that.
Couple of points here:
The working class, even the poor, does carry debt. They carry mostly consumer debt, like consumer credit cards and auto loans. Per income, their debt is just as burdensome as it is for the middle class with their additional mortgages and student loans. What makes it actually worse for the poorer debtors is that their interest rates tend to be much higher than it is for the middle class and wealthy.
America does not have a natioal worth of "negative 44 trillion." That's just a silly abstraction. The percentage of debt per GDP is managable and historically stable. Yes, it is a lot of debt, but we're a big country. EVen when it hits 50K per capita, over one's working lifetime, that only comes out to about 1K a year, easily absorbed by progressive taxation on the wealthy.
On top of that the Baby Boomers will not live forever and the ration of old to young will significantly lower and level out in a about twenty to thirty years, drastically reducing the debt.
Paper money will never go away - that is until it becomes completely digital. It's a silly pipe dream to believe otherwise.
Finally, if there is an uprising, it will not be economically libertarian. It will be the working class rising up and demanding more progressive taxation, the end of the military empire, and a political reform deisgined to reduce the power of the corporatocracy.
JMJ
oooh just wait til gas reaches 8 bucks a gallon..see what the Libtards say then Silver..good grief.
...It's all OK Jersey. Go back to sleep, Uncle Sugar will keep you safe and warm...
What an adolescently sleazy retort.
I'm a pretty big man, Silver. You should grow up and act like a big man too.
JMJ
Jersey, "big men" generally don't need a nanny. Just sayin'...
Oh boy Jersey, what kind of cigarette is that in your mouth? Have you been smokin the wacky tabacy?
You just sound so naive, Jersey. High tides and green grass forever, huh? President Obama's got his magical never ending stash of money?
I also can't believe you are for currency devaluation. That hits old people like my grannies on fixed incomes especially hard, but as long as wall street and DC are doing ok, huh Jersey?
Do you even know what you stand for?
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