Video: Then Congressman Ron Paul Questions Federal Reserve Chairman Ben Bernanke About Real Inflation

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Record Corporate Profits? How’d they Do That? The Inflation Income Redistribution Scam

By the third quarter of 2012 (which are the latest available data), according to the US Bureau of Economic Analysis, corporate profits were on pace to exceed the record earnings of 2011, despite a pathetic economy. How did they do it? It’s simple. They shipped jobs overseas and redistributed the difference between the higher paying jobs in the US and the new lower wage jobs elsewhere into the pockets of the already rich via higher dividends and share prices. But CEO’s have discovered a more sinister way to increase profits at the expense of the 99 percent.

They jacked up their prices, and the government deliberately hides those increases by understating inflation.

Three years ago, I could purchase three cans of generic label tuna for a dollar. Two years ago, I could purchase two cans for a dollar. Now I’m lucky to get one can of the same tuna for a dollar, although sometimes I can get a can for .79 cents. Same thing has occurred with gasoline, lettuce, milk, bread, meat and other items. Okay, it’s true sometimes prices for certain items don’t rise, perhaps I-Phones, but you can’t eat them, nor can you put them in your gas tank.

Just using the tuna as an example, the price per can rose from .34 cents to .50 cents to .79 cents, or roughly 45-50 percent per year. Take a look at most things you purchase. Prices are rising rapidly. The difference between the old, lower, prices and the new, higher, prices go into the pockets of the rich via higher corporate earnings, rising dividends and share prices. And the government is covering it up by understating inflation. that’s because of the massive corruption of the federal government.

The government says the US inflation rate for 2012 was 1.7 percent. On the other hand, the Everyday Price Index calls it closer to eight percent, which is probably closer to the truth, which is something our government and corporate media no longer provide us, unless it is convenient for them.

Last summer, Harper’s Magazine pointed out that the government’s measurement of inflation for 2010 was slightly higher than three percent, but the government has changed the way it measures inflation twenty times since 1980. If the old method of measuring inflation from 1980 was used, inflation for 2010 would be almost 11 percent. We would be outraged and demand the government do something about this serious problem. But we can’t be outraged, so the media and government simply lie to us, thus ensuring that we don’t know there’s a problem since the government is covering it up. We’re like frogs in a slowly heating pot of water.

Below is an example of how the corporate lies to us.

“The combined earnings of the Fortune 500 corporations rose 16 percent from 2010 to a record high of $825 billion in 2011, Fortune magazine said.”

“Given the sluggish recovery and a strapped consumer, you’d expect to see corporate America trudging along, not racing for glory,” Fortune’s senior editor-at-large, said.

“In fact, the Fortune 500 are thriving as a group. Unlike the US economy, they’ve shown quicksilver agility, rapidly shifting their product mix and producing more goods at little new cost.”

That is total bull shit. These corporations haven’t “shown quicksilver agility, rapidly shifting their product mix and producing more goods an little new cost.” That’s a lie. They’ve achieved this result simply by raising prices and shifting jobs overseas. These actions have redistributed income and wealth from the 99 percent to the one percent.

The first duty of the editor of any corporate news media outlet is to lie to the American people. That way they can keep their corporate advertisers happy. That’s precisely what Fortune Magazine does.

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Inflation is Greater than We Are Allowed to Believe

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What Will the Rich Do With the Extra Money They Get With Mitt Romney’s Proposed Tax Cuts?

Mitt Romney’s proposed tax cuts for the rich will destroy jobs. That’s because the 1 percent invest their money in things like derivatives. According to Wikipedia, “A derivative is a financial instrument whose value is based on one or more underlying assets.” In other words, the value of derivatives and the money the owner of the derivatives receives comes from such underlying assets as car loans, mortgages, student loans, other commodities, stocks, bonds, interest rates and currencies. Currently, there is an estimated 200-500 trillion dollars in derivatives.

The rich invest mostly in derivatives. None of these derivatives create jobs, except on Wall Street; most help to destroy jobs by pressuring CEO’s to ship them overseas. The very existence of derivatives often place pressure on corporations to force employees to work longer while earning less per hour. Virtually every derivative forces the 99 percent to pay more for things, and the difference between the old, lower rate at which people paid for things and the new, higher rate goes into the pockets of the 1 percent via their derivatives.

Take student loans, for example. When somebody on Wall Street created a bond backed by student loans more than thirty years ago, Wall Street placed pressure on politicians to cut Pell and other government educational grants, so as to force students to take out more loans, which served the interest of Wall Street investors, which Wall Street’s President, Ronald Reagan was happy to comply with. Since business leaders insist that education is the key to a strong economy, the government made a move against the interests of the US, and they did it all to appease rich investors. Student loan debt now exceeds $1 trillion, which is more than total credit card debt. That’s why we now pay more in student loans; it’s thanks to the development of the derivatives market.

Derivatives attract investors, and therefore they compete with stocks and bonds, which also need investors, otherwise the value of these assets will plummet to zero. To keep stock prices competitive with derivatives, CEOs are forced to ship jobs overseas, and the difference between the old higher pay in the US and the new lower pay over there goes into the pockets of the 1 percent. The middle class people who lose their jobs pay the price. But it’s worse than that because when jobs are shipped overseas, part of the tax base that supports schools, police, road building and repair, fire fighters and other jobs are shipped oversea, or so it appears. In reality, the lost part of the tax base is shipped into the wallets of the 1 percent. That’s why there’s so many cuts in education nowadays, kindergarten through universities.

That’s how rich investors have become parasites to the 99 percent. And that’s the kind of havoc that Wall Street Mitt the Twit’s tax cuts will wreck on the US economy. They will also redistribute massive amounts of income from the 99 to the 1 percent, and utterly destroy the demand for goods and services in the process. His economic plan is a disaster waiting to happen.

Derivatives are where the rich will invest much of their newly available cash if they get a tax cut from President Mitt. And we’ll all be paying for those cuts, not benefiting from them. By the way, what I have outlined here is also why trickle down economics is really trickle up economics.

According to Wikipedia, “Under US law and the laws of most other developed countries, derivatives have special legal exemptions that make them a particularly attractive legal form to extend credit. The strong creditor protections afforded to derivatives counterparties, in combination with their complexity and lack of transparency however, can cause capital markets to underprice credit risk. This can contribute to credit booms, and increase systemic risks. Indeed, the use of derivatives to conceal credit risk from third parties while protecting derivative counterparties contributed to the financial crisis of 2008 in the United States.

Financial reforms within the US since the financial crisis have served only to reinforce special protections for derivatives, including greater access to government guarantees, while minimizing disclosure to broader financial markets.

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Where Have All the Good Jobs Gone?

John Schmitt and Janelle Jones of the Center for Economic and Policy Research reached a conclusion from their research. Their conclusions are incorrect, but the information is still impressive. A synopsis is below.

“The U.S. workforce is substantially older and better-educated than it was at the end of the 1970s. The typical worker in 2010 was seven years older than in 1979. In 2010, over one-third of US workers had a four-year college degree or more, up from just one-fifth in 1979. Given that older and better-educated workers generally receive higher pay and better benefits, we would have expected the share of “good jobs” in the economy to have increased in line with improvements in the quality of workforce. Instead, the share of “good jobs” in the U.S. economy has actually fallen. The estimates in this paper, which control for increases in age and education of the population, suggest that relative to 1979 the economy has lost about one-third (28 to 38 percent) of its capacity to generate good jobs. The data show only minor differences between 2007, before the Great Recession began, and 2010, the low point for the labor market. The deterioration in the economy’s ability to generate good jobs reflects long-run changes in the U.S. economy, not short-run factors related to the recession or recent economic policy.”

The reason why so many good jobs are gone is simple; they’ve been redistributed to the rich. Enact a free trade treaty, ship jobs overseas. The difference between the old higher wages in the US and the new lower wages is pocketed by the affluent via higher corporate profits, rising dividends and surging share prices. This income redistribution scam is achieved by manipulating the political markets, i.e. purchasing the rules of the game. That’s precisely how the 1 percent have stolen nearly 30 of the total national income compared to about 8 percent back in 1980.

When the jobs are shipped away and the income from them is redistributed to the 1 percent, opportunities are lost for the rest of us, and more so than just the loss of the jobs. When those jobs are exported via bribed-enforced legislation, we lose our tax base and government jobs go away, like police, firefighters and teachers. There are less opportunities for accountants, mechanics and attorneys in government.

And illegal free trade treaties are just one way the one percent manipulate the legislative process to achieve income redistribution from the 99 percent. There’s a ton of other ways. Deregulation, for example, allows corporations to jack up the prices they charge at will. The difference between what prices would be under real competitive conditions and the manipulated prices go into the pockets of the rich via the same route as free income redistribution treaties.

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Nafta on Steroids; The Trans Pacific Free Trade Income Redistribution Treaty

Where Have All The Good Jobs Gone? Center for Economic and Policy Research

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The Middle Class Is Shrinking. Is it because of tax cuts for the rich?

Tax cuts for the rich are destroying the American middle class. When the rich receive their tax cuts, CEO’s find ways to attract that cash to their stocks by increasing their profits. Rising profits normally mean increasing dividends and share prices. Investors are inclined to sink their newly available tax money into investments with higher rates of return.

That’s why CEO’s race to ship jobs overseas, create jobs overseas and place downward pressure on the compensation of their US employees. The difference between the old wages and the new is redistributed into the pockets of the already affluent via higher dividends and share prices.

This allows the 1 percent to purchase more legislation that redistributes even more income from the 99 to the 1 percent, such as free trade treaties and deregulation. Free trade treaties result in more and more jobs being shipped oversea, or created over there rather than here. The difference between the old and new wages goes into the pockets of the rich.

The demand for goods and services has declined in the US because less people have money to buy stuff, unless they’re using their homes as ATMs during a housing bubble. Once that bubble burst, the demand sector was squashed, meaning less jobs can be created, and there’s still downward pressure on middle class wages and salaries.

The process means the destruction of local bases, layoffs of teachers, fire fighters, police and other government employees. The economy begins to collapse in slow motion over a period of several years. Only the New Deal and the Great Society programs hole the economy up.

That’s why, “In 1979 the middle three household income quintiles in the United States—that is, the population between the 21st and 80th percentiles on the income scale— earned 50 percent of all national income. But by 2007 the income share of those in the middle shrank to just 43 percent. Between 1979 and 2007 the Gini coefficient including capital gains, in the United States, climbed from 48 to 59, ranking the United States in the top quarter of the most unequal countries in the world.”

Tax cuts for the rich are also why the 1 percent received 93 percent of total US income growth from 2009 to 2011.

See Related Story

The Shrinking Middle Class–From The Center for American Progress

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Income Redistribution Hidden by Understating Inflation

By the third quarter of 2012 (which are the latest available data), according to the US Bureau of Economic Analysis, corporate profits were on pace to exceed the record earnings of 2011, despite a pathetic economy. How did they do it? It’s simple. They shipped jobs overseas and redistributed the difference between the higher paying jobs in the US and the new lower wage jobs elsewhere into the pockets of the already rich via higher dividends and share prices. But CEO’s have discovered a more sinister way to increase profits at the expense of the 99 percent.

They jacked up their prices, and the government deliberately hides those increases by understating inflation.

Three years ago, I could purchase three cans of generic label tuna for a dollar. Two years ago, I could purchase two cans for a dollar. Now I’m lucky to get one can of the same tuna for a dollar, although sometimes I can get a can for .79 cents. Same thing has occurred with gasoline, lettuce, milk, bread, meat and other items. Okay, it’s true sometimes prices for certain items don’t rise, perhaps I-Phones, but you can’t eat them, nor can you put them in your gas tank.

Just using the tuna as an example, the price per can rose from .34 cents to .50 cents to .79 cents, or roughly 45-50 percent per year. Take a look at most things you purchase. Prices are rising rapidly. The difference between the old, lower, prices and the new, higher, prices go into the pockets of the rich via higher corporate earnings, rising dividends and share prices. And the government is covering it up by understating inflation. that’s because of the massive corruption of the federal government.

The government says the US inflation rate for 2012 was 1.7 percent. On the other hand, the Everyday Price Index calls it closer to eight percent, which is probably closer to the truth, which is something our government and corporate media no longer provide us, unless it is convenient for them.

Last summer, Harper’s Magazine pointed out that the government’s measurement of inflation for 2010 was slightly higher than three percent, but the government has changed the way it measures inflation twenty times since 1980. If the old method of measuring inflation from 1980 was used, inflation for 2010 would be almost 11 percent. We would be outraged and demand the government do something about this serious problem. But we can’t be outraged, so the media and government simply lie to us, thus ensuring that we don’t know there’s a problem since the government is covering it up. We’re like frogs in a slowly heating pot of water.

Below is an example of how the corporate lies to us.

“The combined earnings of the Fortune 500 corporations rose 16 percent from 2010 to a record high of $825 billion in 2011, Fortune magazine said.”

“Given the sluggish recovery and a strapped consumer, you’d expect to see corporate America trudging along, not racing for glory,” Fortune’s senior editor-at-large, said.

“In fact, the Fortune 500 are thriving as a group. Unlike the US economy, they’ve shown quicksilver agility, rapidly shifting their product mix and producing more goods at little new cost.”

That is total bull shit. These corporations haven’t “shown quicksilver agility, rapidly shifting their product mix and producing more goods an little new cost.” That’s a lie. They’ve achieved this result simply by raising prices and shifting jobs overseas. These actions have redistributed income and wealth from the 99 percent to the one percent.

The first duty of the editor of any corporate news media outlet is to lie to the American people. That way they can keep their corporate advertisers happy. That’s precisely what Fortune Magazine does.

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Class Warfare in a Rigged Game; the One Percent Steal 93 Percent of Total US Income Growth from 2009 to 2011

The rigged economic game continues and has gotten more one-sided. A new study below shows that the one percent extracted 93 percent of total US income growth from 2009 to 2010. The rest of us shared the 7 percent. This occurred through their manipulation of the government. Studies will likely show roughly the same numbers for the division of the growth in total US income from 2010 to 2011. And things will continue to get worse for the 99 percent and the total US economy now that “Wall Street Obama” signed free trade legislation with South Korea, Colombia and Panama last year. We’re hurtling toward third world status.

More US jobs will be shipped overseas, or US corporations will place jobs there rather than here, which would not have been the case without the president’s signature on those treaties. The difference between the wages of the old jobs in the US and the new jobs overseas will go into the pockets of the rich. So called free trade treaties are designed to do just that. Expect the economy to be weaker once Obama signs the Trans-Pacific Freely Redistributing Income Treaty sometime later this year. It’s not too late for the 99 percent to stop the madness.

The same redistribution process occurs in a number of other areas, such as deregulation. When, for example, the electricity market is privatized and deregulated, prices always go up, especially in the long term. “Aunt Millie” pays higher electricity bills so that rich folks can receive higher dividends and stock prices, straight out of her pocket.

That’s why the government cooks the books on inflation. Inflation is running about ten percent per year, but the government tells us it’s about 3 percent. In other words, raising prices is a way to redistribute income from the 99 to the one percent. The government has changed the way it measures inflation twenty times during the last thirty years so as to understate inflation, which is another way of understating the redistribution of income and wealth.

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One percent get 93 percent of total income growth from 2009 to 2010

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The Numbers Racket; why the economy is worse than we know–Harpers Magazine

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Guess which Senators Voted To Protect Oil Tax Breaks

These senators received $23,582,500 From Big Oil. Who were they?

click here for the full story

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The Dow Jones Industrials and NASDEQ is Surging! Thanks to Run Amok Inflation Redistributing Your Income

The US government is hiding the true cost of inflation so that it can it hide an income redistribution scam for the rich. Corporations simply jack up the prices the 99 percent pay for food and energy and the government doesn’t count it when it measures inflation, but corporate profits rise because of those price increases, and the difference between what the 99 percent paid for the items at the old prices and the new higher prices goes into the pockets of the rich via higher profits, dividends and stock prices. That’s a nice scam. It makes the affluent richer and throws a growing number of the 99 percent into the poor house. That includes a lot of professionals, like teachers.

According to the US Bureau of Labor Statistics, inflation was 3.2 percent for “all items,” in 2011. However, they didn’t count food and energy among those “items.” Real inflation is running close to 10 percent, and it has for the last several years (click here for real inflation).

Do you feel more poor than five years ago? If you earned thirty dollars an hour in 2007 and you’re still paid 30 dollars an hour in 2012, your real spending power has dropped about 34 percent, if you measure your wages against the real rate of inflation. Assuming a real inflation rate of 10 percent per year since 2007, people earning $30 an hour now can purchase only $19.26 worth of goods. But wait! That’s before taxes! But you get the picture.

Do you want to know why the stock markets are surging at record levels? They’re surging via inflation. If you’re earning $30 an hour, the rich are now raping you of $10.74 per hour more than they did back in 2007, and receiving it in higher profits, dividends and share prices. And your government is helping corporate America hide this rape and pillage of the American people. Look at the figures below. For simplicity, I measured your real spending power at $30 an hour in 2007, and then subtracted 10 percent each year since that approximates the amount of real inflation per year. Remember that inflation is not some abstract term. It measures price increases. So if meatloaf goes up in price by a dollar a pound, then that extra dollar is stolen from your slimmer wallet and slipped into the bulging pockets of the affluent.

2007 $30
2008 $27
2009 $24.30
2010 $21.40
2011 $19.26

Click on the link below and check out the story of the overly educated working poor.

click here for working poor in America

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