That's the essence of a lengthy and very informative essay by Quoth The Raven. Here are some extended excerpts. They may look dauntingly long, but they're right on the money (you should pardon the expression) and are well worth reading. If you're finding it hard to make ends meet, this is why.
The widening wealth inequality gap is the political third rail nobody in power truly ever wants to touch.
Politicians will scream at each other all day over taxes, healthcare, immigration, tariffs, student loans, climate policy, or whatever outrage is currently driving engagement on cable news and social media. But the second the conversation turns toward monetary policy, toward the machinery of money creation itself, the room suddenly gets very quiet.
That’s because monetary policy has quietly become the single most powerful force reshaping wealth distribution in modern America. And unlike the endless partisan theater surrounding fiscal policy, monetary intervention oddly enjoys remarkable bipartisan support.
Republicans and Democrats may pretend to be existential enemies on television, but when it comes to flooding the financial system with dollars, both parties reliably fall into line. And that support is precisely why this topic is politically radioactive: once people understand how the system works, the illusion of two competing economic ideologies starts to collapse. Republicans want less spending, Democrats want higher taxes…but both parties want the Fed to keep printing dollars.
. . .
Now we operate inside a permanently distorted financial system where trillions of dollars can be electronically created and injected into markets whenever instability appears. The market is no longer primarily driven by productivity or efficient allocation of capital. It is driven by liquidity. Price discovery has been replaced by intervention dependency and risk has been socialized while gains remain privatized.
And every time markets threaten to correct naturally, policymakers intervene to ensure asset prices do not fall far enough to inflict meaningful pain on the people who own the overwhelming majority of financial assets. And the consequences of this have been staggering.
While both parties bitch and moan about affordability, protecting the middle and lower class, and “equity”, one of the clearest signs of this Fed-created distortion is the explosive growth of the ultrawealthy class. According to The Wall Street Journal, there are now roughly 430,000 American households worth more than $30 million, including approximately 74,000 households worth over $100 million. The growth of these groups has dramatically outpaced overall population growth over the past several decades.
In other words, Fed policy, blessed by both political parties, is widening the wealth inequality gap both political parties claim to fighting against ... When it comes to purchasing power, we are literally taking from the poor, and giving to the rich.
. . .
Beneath the culture war circus exists a deeper bipartisan consensus: financial markets must remain inflated at all costs.
And the lower and middle class gets absolutely brutalized in this arrangement.
Historically, middle-class wealth accumulation depended on disciplined saving, stable employment, affordable housing, and gradual investment appreciation over time. But inflationary monetary regimes destroy the reliability of all of those pathways. Savings become punishment, cash becomes a melting ice cube, young people are forced into speculative assets (or outright becoming gambling addicts) simply to attempt to preserve purchasing power. Conservative investing gets punished while reckless leverage gets rewarded.
Entire generations now feel compelled to try and make quick money in markets not because they are greedy, but because monetary debasement has made traditional financial prudence nonviable. This creates an economy built less on productivity and innovation and more on asset inflation, debt expansion and outright speculation.
. . .
A market that cannot survive without permanent monetary life support is no longer a healthy market, it is a managed dependency system. A patient on hospice care. And every bailout pushes the reckoning further into the future while making the eventual consequences even worse.
There's more at the link. It's a long article, but well worth reading in full.
My take-away from this article is that if every American took the time to read and understand it, we'd have a Second American Revolution almost overnight. It's precisely because most Americans don't understand what is being done in their name by their political leaders (who are enriching themselves in the process, at our expense) that our current miserable monetary situation has been allowed to develop. I fear that unless and until we kick out those responsible, it'll just go on until it collapses . . . but such a collapse would take us with it, and punish everybody, not just the guilty.
What can we do about it? Elect a better class of politician, on both sides of the political divide. Will we do that? I fear too few of us care enough to make the attempt . . . and that's what our current politicians rely on to keep their place in the sun.
Peter
18 comments:
Peter my friend, you overestimate the ability of a large part of Americans ABILITY to READ that Long Article.
Most Americans of voting age were educated in an ever-dumber down system that gives a passing grade to a lower and lower standard of reading skills and comprehension.
It's a FEATURE not a glitch. Stupid people are easier to control.
The internet TLDR means too long didn't read shows how short a lot of our readers are in reading comprehension.
Imperial Rome died from foolish costly wars AND Bread and Circuses designed to keep the mob's content.
TODAY we have EBT, Welfare, Mass Media and social media as well as foolish wars like the current round 2 war against Iran.
All that sad to explain why the "powers that BE" are not concerned about a revolution.
All Empires have a Best by Date.
I am amused you pointed out BOTH sides of the political system BOTH want even MORE of our Tax Dollars in their pockets YET say we "need to elect a better grade of politician".
Please point out a couple of examples of successful NON-Corrupt elected to office politicians in the past 50 years.
I'll wait; I have a coffee pot on my table over here.
We're not voting ourselves out of a PLANNED techno tyranny of a few overlords and a lot of serfs (with planned population reduction designed in the system).
Manufacturing efficiency has grown 2% on average over the last 50 years. Who has benefitied, not the people on the shop floor.
American currency was deflationary in the early 1800s. You could put your money under your mattress and be better off 5 years later. Our acceptance of 2% inflation (the target admitted to) as normal.
We haven't elected our politicians for about 50 years. More and more about election fraud keeps trickling out and yet no arrests or trails.
Imagine what happens with digital currency, which in many ways we already have, OBTW.
Until we restore government by the people and not the current oligarchy we're SOL.
told my brother this years ago. stuff is better than money. as long as it is the right stuff !
investments made in items have prove to hold or go up in value compared to any bank account.
it not that gold has gone up so much as more like how little your money is worth to it.
learned this from Grandpa many years ago.
he hated FDR with a passion for what he did to us.
There's a reason the commies took over the teaching colleges and teacher's unions first. Every generation since is heavily indoctrinated.
Do you really think an election can solve this? Do voters actually matter in a managed democracy? The primaries already filter out anyone with principles and mathematical literacy.
The Federal Reserve does official counterfeiting. Currency inflation is a tax on middle class savings in dollars, to be spent by Congress on companies the rich own stock in.
Perot had TV commercials saying you can't fund long-term growth using short-term debt.
An election is just a contest between the dollar amounts of advertising purchases, multiplied by the amount of freebies promised.
Voting never produces conservatism, that's the point of voting.
Voting for liberty is like fornicating for chastity.
I learned a long time ago it is easier to make money if you have money. It is much harder to make money if all you have is debt. It's been that way through all of time. The rich get richer and the poor remain poor. No political system ever solved that dilemma, and I doubt it ever will.
Ok....well I do understand the dilemma and the froth from previous commenters. I guess I would like to posit on what would happen to the economy if the FED didn't print anymore money.
Would the sky fall? Would Jafante riot because of no money in his EBT card? Just what would the fallout be like if the FED was ended?
George Washington crushed honest commodity money in the Whiskey Rebellion, so the Eastern Establishment central bankers could do this. There was no honest political system America departed from, it was nobles and serfs from day one. That's why the Constitution is a copy of the British government of the time, with the single change that multiple families could supply a monarch without having to conquer each other first.
> what would the fallout be like if the FED was ended?
Congress could no longer spend more than it collected in taxes. Your cash savings would grow in purchasing power as technological innovation made things cheaper, like computer price/performance did but for houses and education and healthcare too. You could save and invest for retirement.
The assumption that there are sufficient fiscally responsible people running for federal office to make a difference is the weakest part of Peter's proffered solution.
Our uniparty system is designed to weed those people off the ballots long before they can get any recognition or momentum.
Which is why a collapse is virtually unavoidable. The only real question is ... when.
Only a minor point. When some of these articles discuss "net worth" of Americans, the potential sale value of homes with massive mortgages is often used. There are almost no homes in Southern California that are worth less than $1 million on the books. Does that mean that they're all millionaires - no. There are vast differences regionally when it comes to cost of living. When I moved from CA to AZ, living at roughly the same standard, my cost of living dropped about 25%. (as an example)
I agree with Michael and LL. Our 'true' worth is miniscule and dropping, once you actually understand what the actual fiscal policy is.
Explain to me again why income inequality is so bad. "The poor ye shall always have with thee", and according to the essay we have more ultra wealthy than ever before. That's good right? More people are making big money. Further, it's not a zero-sum game where some people getting richer takes money away from others. As a side note, it could ( and should) be argued that Trump is trying to move production out of China and back into the U.S. that should be applauded. However while Trump can seize production back from the Chinese et al, nothing he can do can prevent robotization and A.I. from taking away jobs. This has been a fact since the 1800's when poor workers in the Belgian city of Liège would throw a wooden sabot into the machines to disrupt production.
What Time is the Game On?
Are You Not Amused?
@ LL and Old NFO.
Fine!
What are WTP to do about the mess our Congresscritters have put us in? When?
A number of people who understand what's happened to the middle class and how, look at plastic ketchup bottles.
Henry Ford said sometime in the 1920s or 30s: “It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
The massive transfer of wealth and assets from us to them is the culmination of a plan conceived and implemented long ago. We are now seeing it's culmination. And there is NO easy, pleasant or peaceful solution to this assault on our freedom and our very lives.
The change will involve Kangaroo Courts and Hemp. Imagine how much money we would actually have to pay in Taxes if our "masters" where even slightly honest?
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