The Rich Get Richer While the "Little Guy" Gets the Bill

It is amazing to watch the controlled destruction of the American economy while most citizens just go about with their amusements. Although Detroit is obviously the most devastated large city in America, the news is now out that many of the other metropolitan areas of the country are now suffering the same fate. My contention has always been that Detroit was just hit by the first part of this destructive wave, but I knew that it was going to hit the rest of the country. It is just not possible for the heart of the manufacturing base to be destroyed and to maintain a healthy country. But this is what people were led to believe by the mainstream media. Such is the quality of thinking and reasoning of the masses.

And believe me, the mentioned cities in the report from Forbes at the link above are not the only cities being hit by this economic depression. We know that California is experiencing the biggest fiscal deficit of all the states, so it isn't a surprise that Los Angeles is having major problems as well.

The biggest surprise to me is the non stop march of money to the Military-Industrial Complex (as Eisenhower referred to it in his outgoing speech). This country spends TRILLIONS of dollars on guns, weapons and the 'War on Terrorism' like there is no other priority. Of course, this is to protect us from these legions of terrorists who are just lurking around, waiting to kill all of us.

So let me get this right: we spend more on weapons and defense than all other countries in the world COMBINED, but we can't stop terrorist attacks without spending even MORE money? And in spite of all these expenditures, we still had a terrorist attack (WTC-Pentagon). So now we are fighting 2 wars on the other side of the world to protect America? I wonder how we are protecting America by having the Army on the other side of the planet.

Ok, even if we leave that incredibly large expenditure out of the equation, we still have the banks and other financial interests who are getting large handouts from the government while paying ZERO taxes. So these guys have GREATLY profited from the NINJA loans and other financial shenanigans (like derivatives, high frequency trading, fraudulent financial reporting , etc.), and when they get busted for all of their misdeeds and assorted scurrilous behaviors , they get free government money with no strings attached! No jail time, but 'get-out-of-bankruptcy-free' passes and the biggest bonuses & profits in their history! I'm beginning to think that I went into the wrong occupation...

The bottom line is that we are paying for America to be destroyed, and we're paying top dollar for it, all while our real economy is being decimated. So the rich get richer, and the middle class gets the privilege of being reduced to peon status while receiving the bill for all of it. What a bargain.

We couldn't have destroyed America any better if we would have given the Communists, and any other enemy of the country free access to all of the control mechanisms of the country. If this wasn't the planned destruction of America, it is definitely the best imitation of a plan to destroy America. Unfortunately, by the time people wake up and see what has happened, it will be too late. If it isn't too late already, it is very close to that point.

The worst part of it is that most Americans are busy blaming other average citizens for their own demise while fighting over the crumbs that are left of the shrinking American Pie, the people who are actually doing this (i.e., high level government officials, corporations, lawmakers, lobbyists, globalists, etc.) are sauntering away with all of the money and power.

So what are we going to do about this?

Consolidation of Banking

I've been talking about economics and what is happening with banking for a while now. The fact of the matter is that there is a great consolidation of banking that has been initiated with this 'banking crisis' that has been in effect lately. Although the mainstream press would have you believe that it is the result of stupid, mistaken, idiotic bankers who are making errors, this is not plausible.

Virtually all of the people who are in charge of banks, banking and government policies are highly credentialed (i.e., have Ph.D.'s and other college degrees from mostly Ivy League colleges). This effectively negates the assertion that these people do not know what they are doing. I say that not only do they know exactly what they are doing, but that they are succeeding at what they have already planned to do.

Let's look at this logically. The banks made massive amounts of money from lending all through the creation of the 'Subprime Banking Crisis' before it was a crisis. This was all made possible by their great efforts (that eventually succeeded) to get the Glass-Steagle act repealed. This law was passed after the Great Depression of 1929 to prevent banking organizations from performing standard banking operations and investment banking simultaneously to minimize 'moral hazards' (i.e., a euphemism for stealing, plunder, profiteering and other scandalous behaviors).

So the banks (along with their paid cronies in government) made obscene amounts of money from this. This is in addition to their realizing astronomical profits from derivatives trading, which is mostly done 'off-the-books' because there is no standardized, regulated market for derivatives. They are virtually all customized transactions, and are therefore not regulated, not public and are difficult to value. It's like basically being able to stack the proverbial Casino in your favor.

But the ugly realities of making bad loans and continually making excessive bets have led to major structural problems in banking. So when the 'cookie jar broke' and the banks were about to all go bankrupt, they pressured their friends in D.C. to help them out, and that's exactly what they did. We know it as the TARP program, which basically amounts to 'corporate welfare'. Instead of the many trillions of 'investments' being valued at their actual market value, the government bailouts allowed the banks to keep their face values so that the banks would not experience actual losses. They were allowed to maintain the facade of being solvent, although the truth is that they are all technically bankrupt.

So for all of this, the People of the United States were given the bill for all of this. The payment for this will be through layoffs, higher taxes, less services, the collapse of local and state governments, inflation and/or deflation that will greatly erode the wealth of average people, and possibly totalitarian fascist police state provisions to keep the masses from holding the government and corporate people responsible for these events responsible.

I know I've covered a lot of ground in these few paragraphs, but I didn't want to overwhelm you with a lot of technical jargon that may confuse you. But I have found a great article that goes into great depth about this situation. It is lengthy, but if you can absorb the content and meaning of this article, you will have a much better understanding of where the economy is, and what is really going on in the world. You can forget the crap that they're feeding you on MSNBC and similar financial 'news' outlets because that drivel is merely designed to keep the sheep calm while they are being fleeced. This is some of the most important information that you can get for yourself, your family and your country. It will affect every facet of your life, and the lives of the people you know.

You may think I'm crazy, but you owe it to yourself to step outside of the corporately-controlled media and do some thinking for yourself. Running multi-trillion dollar budget deficits just isn't sustainable on a long-term basis. It appears to me that those who control governments and economies are purposely running all of the world's economies into the ground so that they can institute this One-World Government and One-World Currency. The old saying is that 'nothing happens by accident in politics', and you can best believe that with trillions of dollars in the balance, there are forces working to control them and gain as much of that loot as they possibly can. Don't be naive. Face reality and deal with it, because it will definitely deal with you one day! It has a nasty habit of popping up at the most inopportune moments.

What Went Wrong - Primer on Derivatives and the Market Meltdown

http://www.washingtonpost.com/wp-dyn/content/article/2008/10/14/AR2008101403343.html

This is an article from the Washington Post that breaks down the events regarding the financial instruments called derivatives, and how they became a part of this present market meltdown. It is basically a primer on how they work and how at least one person tried to get the government to regulate them. Now, they are a bigger part of the world's economy than the world economy itself, with notional (face) value of over $53 TRILLION! Warren Buffett called them 'financial weapons of mass destruction' because they can be used to generate obscene profits, but also (when leveraged extremely high) have the ability to destroy the entire world's economy, as what happened in 1998 with a company called Long Term Capital Management.

LTCM was ran by the researchers that actually won the Nobel Prize for Economics when they came up with what is known as the Black-Scholes formula that is used to calculate prices (technically called premiums) on derivatives. They work fine as long as the assumptions in the model are true. LTCM was highly leveraging their investments in these instruments. They were trading derivatives (i.e., options) on the Russian GKO bond market, which were government bonds. When this market experienced a discontinuity (i.e., when the model's assumptions were not true anymore because the Russian government defaulted on the bonds), this made the company instantly bankrupt, and they did not have the ability to pay any of their counterparties (i.e., the companies on the other side of the investment). The counterparties therefore could not pay the companies with which they had investments. This created a daisy chain of possible company failures that were threatening the entire global banking system.

Then Federal Reserve Chairman Alan Greenspan got together a group of around 10 of the largest banks in America to 'pony up' and 'donate' about $5 billion to cover LTCM's losing position in order to save the world's economic system. I bet you didn't remember that story, but it was the day that derivatives almost destroyed the world's financial system. Tom Brokaw didn't tell you about that one. And you thought the evening news really kept you informed. This was before Enron, Tyco, Fannie Mae, etc.

So these people (regulators, financial professionals and Congressmen alike) have known about the dangers of derivatives for a long time, but continued to allow the financiers to make their money. And now, when their shenanigans have caught up with them, they come to average people to bail them out. Even though we didn't want to do it (since the majority of voters and average people didn't back these bailouts), the Congress that is beholden to the big corporations gifted our money to them anyway. Don't you just love democracy?