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Posts Tagged ‘Federal Reserve System’

The financial markets are soaring, and this has pushed the US economy into a prolonged slump, what Nobel Prize Economist Paul Krugman calls a “low-grade Depression.” Our low grade Depression has been going on since December 2007, while the financial markets have been soaring since 2009, and this is a simple case of cause and effect.

Jobs are being exported year after year, and the difference between the old US wages and the new lower overseas wages go into the pockets of the rich via higher corporate profits, rising dividends and soaring share prices. The unemployed may get unemployment insurance if they’re lucky. It’s a simple case of income redistribution.

Nearly 2 million jobs were exported from the US in 2013. Jobs are the biggest export product produced in the USA. Between 0.9 and 3 million jobs are exported year after year, according to the Federal Reserve, since just before NAFTA.

That doesn’t count the massive numbers of jobs that are created by US companies overseas, that would normally be created in the USA, and performed by US citizens, in the absence of corporate trade treaties, which are specifically negotiated to redistribute income from the 99 to the 1 percent in exactly this way. The difference between the higher wages that should be paid in the USA, and the lower wages paid overseas, is redistributed into the pockets of the super rich, thanks to corporate trade treaties, such as the looming Trans Pacific Partnership, being pushed by Wall Street President Barack Obama, and Wall Street Senators Ron Wyden, Max Baucus and Mitch McConnell.

Where the jobs have gone–Thingprogress.org

The combined job losses have depleted our tax base for schools, other public services, and the US social safety net. Where has the money gone? Directly into the pockets of the rich, which is why the financial markets are soaring.

The 1 percent have taken their ill-gotten gains and invested much of this newly available cash in the financial markets. The result has been the creation of massive financial market bubbles in the US (and perhaps throughout the world, but that’s beyond the scope of this story).

The Dow Jones Industrial average closed at 15,680.35 on December 26 2013, up from 6547.05 in 2009, a rise of almost 240 percent. Meanwhile, the NASDAQ shot up from 1293.85 on March 2, 2009 to 4156.59 on December 26, 2013, an increase of over 320 percent. Other US financial markets have posted similar gains.

Since these advances in the values of corporate share prices have been caused by income being redistributed from the 99 to the 1 percent via federal legislation, such as corporate trade treaties, the result has been a slacking of demand for goods and services in an already weak economy. That’s because the super rich invest their money with an eye toward redistributing more money from the 99 percent into their pockets, while the 99 percent buy stuff, creating demand for goods and services. That’s how the 1 percent weaken the economy and destroy jobs when they redistribute income to themselves from the 1 percent.

All of this is continually made worse by Republican and Democratic Party hacks, such as President Obama, Republican House Leader John Boehner, and Wall Street Senators such as Ron Wyden and Mitch McConnell. 100 percent of the Republican members of the US congress, and 80 to 90 percent of the Democrats elected to congress and the presidency, as well as the corporate toadies of the insanely corrupt US Supreme Court, are doing the bidding of Wall Street and other billionaires (such as the Koch Brothers) at the expense of Main Street and the nation as a whole.

The financial market bubbles will burst sooner than later, in one to five years. When this occurs, our low-grade Great Depression will become a fully ignited Great Depression. This Depression will make the current US economy look really good, although it is historically awful. The official and deliberately understated unemployment rate will rise beyond 20 percent, and perhaps approach 30 percent. The real unemployment rate, as measured during the original Great Depression, will be between 25 and 40 percent. Interest rates will plummet lower than they are now. Housing prices will collapse. The US ranks right up there with Romania when it comes to child poverty, but we will be challenging Haiti and a few African nations for first place when the financial markets burst. The number of people on food stamps will at least double compared to today.

After the bursting, the Federal Reserve will give out trillions of dollars to rich investors, hedge funds, and investment banks, in order to save the day, and their investments. Of course, Fed officials will say they loaned the money out, although it really will be a permanent loan, like last time. See breakdown-of-the-26-trillion-the-federal-reserve-handed-out-to-save-rich-incompetent-investors-but-who-purchase-political-power–Johnhively.wordpress.com.

However, the Fed’s actions will only make things worse because massive investors already know they are protected from losses by the Fed, and so there are no consequences for their insanely bad investment decisions. That’s precisely why the actions of the Fed will only prolong the misery of the bursting bubble.

The super rich will get bailed out while Main Street will have to suck it up. This means more jobs will be shipped overseas, more cities and towns will go bankrupt due to the exporting of jobs, the excess unemployed and illegal labor will continue to drive wages and salaries down.

However, the Federal Reserve bailout will also mean corporate profits will rise, dividends will shoot up, share prices will expand, and the Ponzi scheme known as the financial markets will continue or stabilize their bubbles. In other words, for 99 percent of Americans, the situation will be quite dire.

One way to cut off the bursting of the bubble at the pass is simply to raise the federal minimum wage from its current pathetic $7.25 per hour to $15 in early or mid 2014, and to $20 by early 2015. The economy can absorb this as easily as it absorbs record corporate profits, year after year, during our low-grade Great Depression, with all of its slack demand for goods and services.

This alone should tell you that prices are not connected to any laws of supply and demand. Instead, prices are largely manipulated by the large corporations, otherwise, prices would be going down with the historically lukewarm demand during these tough times, but prices keep going up, up, and up in defiance of the illegally broken laws of supply and demand. The government is looking the other way as prices of food shoot up. This is another income redistribution scam from the 99 to the 1 percent. The difference between the older prices and the newer higher prices go directly from the wallets of the 99 percent straight into the burgeoning wallets of the super wealthy that have corrupted our government and supreme court.

Some people will foolishly argue that an increase in the minimum wage to $20 will mean increased prices. No, it won’t, at least, no more than is currently the case with manipulated prices. However, even today’s manipulative corporations cannot jack-up prices continuously, although they seem to be able to all the time, whenever they want.

To pay the new minimum wage, most US publicly traded corporations will be forced to dig into their record profits, or their trillions of dollars of retained earnings (estimates are $10-14 trillion worldwide for US companies, and this also tells you how uncompetitive and bloated they are. In other words, they are not competitive at all), in order to pay their employees the higher wages.

From a purely conservative point-of-view, which is the purely conceptualized reality that the US has a competitive, free market economic system despite all the evidence to the contrary, corporate management teams will want to be competitive, just as conservatives want to believe, even in the face of such an overdue rise of the minimum wage.

Therefore, under our current conservative point-of-view, any Neanderthal management team that is dumb enough to increase their prices while their more competent rivals pay their employees the higher minimum wage out of their historically high profits and retained earnings, will go the way of the Neanderthals. It’s that simple. The companies that use their bloated, pent up financial resources in this way will live to fight another day as their Neanderthal rivals go out of business.

Investors, of course, may suffer. They may see their share prices drop temporarily, especially, as competition heats up, as corporations use up their record retained earnings, and have to contend with lower profit margins, like in any competitive economic model. However, this will bring the financial markets down much more gently than compared to a bursting bubble that awaits us in the absence of any federal intervention.

Since the bubbles have been created by redistributing money from the 99 percent to the 1 percent, it stands to reason the best antidote to such an approaching disaster is for corporate royalists to give the money back to those to whom it really belongs; the 99 percent. This can most easily and prudently be done by raising the federal minimum wage to $20 per hour over the next year and a half.

That $10 to $14 trillion US corporations are sitting on can be used to pay US citizens, which will then increase the demand for goods and services, and send the US economy into its first long-term non-bubble economic expansion since the 1960s.

Recent studies show increasing the minimum wage beefs up demand, increases employment, and that there are no negative consequences as is claimed, like job losses. Besides, an increased minimum wage is what our weak economy needs right now. And given record corporate retained earnings and record profits, the economy can easily absorb the higher wage. Enhanced demand will create good paying jobs, flood local tax bases with more income for schools and the social safety nets, safely deflate the financial market bubbles, and in the process perhaps head off the coming Great Depression, and likely even end our current low grade Depression. Furthermore, the 1 percent will have less money with which to corrupt government at all levels, and, by the way, the political markets are another area in which the 1 percent use their ill-gotten gains to invest in legislation against the 99 percent. That does create jobs for corporate lobbyists. So the 1 percent will have less money to do that little thing. So let’s do the obvious thing; raise the minimum wage to $20 an hour.

The legal and logical difference between an owner operated business and a business structured on “organized money” (a limited liability corporation) is as obvious as the difference between a single worker and a large labor union.

Therefore, one last thing needs to be mentioned. There is always somebody who will say raising the minimum wage to $20 an hour will kill small mom and pop businesses. Conceded, those are mostly businesses that operate in something that kind of resembles a competitive business environment. Those businesses should be allowed to operate with a minimum wage of say, $$12-15 an hour. However, since limited liability corporations are nothing more than “organized money,” as FDR accurately put it, and since they operate in a more collusive environment, those corporations are a totally different animal from owner operated companies, and should be made to pay the $20 minimum wage, which should also be indexed to inflation.

The government will always pass legislation that redistributes income from the 99 to the 1 percent, leading the nation into absolute disaster. So brace yourself for the looming economic disaster, just like the 1930s, only worse. One thing can be stated with great certainty. The rich have corrupted our government and have been leading us down the road of an unimaginable economic disaster for over thirty years, just like they did back in the 1920s.

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The financial markets are soaring, and this has pushed the US economy into a prolonged slump, what Nobel Prize Economist Paul Krugman calls a “low-grade Depression.” Our low grade Depression has been going on since December 2007, while the financial markets have been soaring since 2009, and this is a simple case of cause and effect.

Jobs are being exported year after year, and the difference between the old US wages and the new lower overseas wages go into the pockets of the rich via higher corporate profits, rising dividends and soaring share prices. The unemployed may get unemployment insurance if they’re lucky. It’s a simple case of income redistribution.

Nearly 2 million jobs were exported from the US in 2013. Jobs are the biggest export product produced in the USA. Between 0.9 and 3 million jobs are exported year after year, according to the Federal Reserve, since just before NAFTA.

That doesn’t count the massive numbers of jobs that are created by US companies overseas, that would normally be created in the USA, and performed by US citizens, in the absence of corporate trade treaties, which are specifically negotiated to redistribute income from the 99 to the 1 percent in exactly this way.

Where the jobs have gone–Thingprogress.org

The combined job losses have depleted our tax base for schools, other public services, and the US social safety net. Where has the money gone? Directly into the pockets of the rich, which is why the financial markets are soaring.

The 1 percent have taken their ill-gotten gains and invested much of this newly available cash in the financial markets. The result has been the creation of massive financial market bubbles in the US (and perhaps throughout the world, but that’s beyond the scope of this story).

The Dow Jones Industrial average closed at 15,680.35 on December 26 2013, up from 6547.05 in 2009, a rise of almost 240 percent. Meanwhile, the NASDAQ shot up from 1293.85 on March 2, 2009 to 4156.59 on December 26, 2013, an increase of over 320 percent. Other US financial markets have posted similar gains.

Since these advances in the values of corporate share prices have been caused by income being redistributed from the 99 to the 1 percent via federal legislation, such as corporate trade treaties, the result has been a slacking of demand for goods and services in an already weak economy. That’s because the super rich invest their money with an eye toward redistributing more money from the 99 percent into their pockets, while the 99 percent buy stuff, creating demand for goods and services. That’s how the 1 percent weaken the economy and destroy jobs when they redistribute income to themselves from the 1 percent.

All of this is continually made worse by Republican and Democratic Party hacks, such as President Obama, Republican House Leader John Boehner, and Wall Street Senators such as Ron Wyden and Mitch McConnell. 100 percent of the Republican members of the US congress, and 80 to 90 percent of the Democrats elected to congress and the presidency, as well as the corporate toadies of the insanely corrupt US Supreme Court, are doing the bidding of Wall Street and other billionaires (such as the Koch Brothers) at the expense of Main Street and the nation as a whole.

The financial market bubbles will burst sooner than later, in one to five years. When this occurs, our low-grade Great Depression will become a fully ignited Great Depression. This Depression will make the current US economy look really good, although it is historically awful. The official and deliberately understated unemployment rate will rise beyond 20 percent, and perhaps approach 30 percent. The real unemployment rate, as measured during the original Great Depression, will be between 25 and 40 percent. Interest rates will plummet lower than they are now. Housing prices will collapse. The US ranks right up there with Romania when it comes to child poverty, but we will be challenging Haiti and a few African nations for first place when the financial markets burst. The number of people on food stamps will at least double compared to today.

After the bursting, the Federal Reserve will give out trillions of dollars to rich investors, hedge funds, and investment banks, in order to save the day, and their investments. Of course, Fed officials will say they loaned the money out, although it really will be a permanent loan, like last time. See breakdown-of-the-26-trillion-the-federal-reserve-handed-out-to-save-rich-incompetent-investors-but-who-purchase-political-power–Johnhively.wordpress.com.

However, the Fed’s actions will only make things worse because massive investors already know they are protected from losses by the Fed, and so there are no consequences for their insanely bad investment decisions. That’s precisely why the actions of the Fed will only prolong the  misery of the bursting bubble.

The super rich will get bailed out while Main Street will have to suck it up. This means more jobs will be shipped overseas, more cities and towns will go bankrupt due to the exporting of jobs, the excess unemployed and illegal labor will continue to drive wages and salaries down.

However, the Federal Reserve bailout will also mean corporate profits will rise, dividends will shoot up, share prices will expand, and the Ponzi scheme known as the financial markets will continue or stabilize their bubbles. In other words, for 99 percent of Americans, the situation will be quite dire.

One way to cut off the bursting of the bubble at the pass is simply to raise the federal minimum wage from its current pathetic $7.25 per hour to $15 in early or mid 2014, and to $20 by early 2015. The economy can absorb this as easily as it absorbs record corporate profits, year after year, during our low-grade Great Depression, with all of its slack demand for goods and services.

This alone should tell you that prices are not connected to any laws of supply and demand. Instead, prices are largely manipulated by the large corporations, otherwise, prices would be going down with the historically lukewarm demand during these tough times, but prices keep going up, up, and up in defiance of the illegally broken laws of supply and demand.

Some people will foolishly argue that an increase in the minimum wage to $20 will mean increased prices. No, it won’t, at least, no more than is currently the case with manipulated prices. However, even today’s manipulative corporations cannot jack-up prices continuously, although they seem to be able to all the time, whenever they want.

To pay the new minimum wage, most US publicly traded corporations will be forced to dig into their record profits, or their trillions of dollars of retained earnings (estimates are $10-14 trillion worldwide for US companies, and this also tells you how uncompetitive and bloated they are. In other words, they are not competitive at all), in order to pay their employees the higher wages.

From a purely conservative point-of-view, which is the purely conceptualized reality that the US has a competitive, free market economic system despite all the evidence to the contrary, corporate management teams will want to be competitive, just as conservatives want to believe, even in the face of such an overdue rise of the minimum wage.

Therefore, under our current conservative point-of-view, any Neanderthal management team that is dumb enough to increase their prices while their more competent rivals pay their employees the higher minimum wage out of their historically high profits and retained earnings, will go the way of the Neanderthals. It’s that simple. The companies that use their bloated, pent up financial resources in this way will live to fight another day as their Neanderthal rivals go out of business.

Investors, of course, may suffer. They may see their share prices drop temporarily, especially, as competition heats up, as corporations use up their record retained earnings, and have to contend with lower profit margins, like in any competitive economic model. However, this will bring the financial markets down much more gently than compared to a bursting bubble that awaits us in the absence of any federal intervention.

Since the bubbles have been created by redistributing money from the 99 percent to the 1 percent, it stands to reason the best antidote to such an approaching disaster is for corporate royalists to give the money back to those to whom it really belongs; the 99 percent. This can most easily and prudently be done by raising the federal minimum wage to $20 per hour over the next year and a half.

That $10 to $14 trillion US corporations are sitting on can be used to pay US citizens, which will then increase the demand for goods and services, and send the US economy into its first long-term non-bubble economic expansion since the 1960s.

Recent studies show increasing the minimum wage beefs up demand, increases employment, and that there are no negative consequences as is claimed, like job losses. Besides, an increased minimum wage is what our weak economy needs right now. And given record corporate retained earnings and record profits, the economy can easily absorb the higher wage. Enhanced demand will create good paying jobs, flood local tax bases with more income for schools and the social safety nets, safely deflate the financial market bubbles, and in the process perhaps head off the coming Great Depression, and likely even end our current low grade Depression. Furthermore, the 1 percent will have less money with which to corrupt government at all levels, and, by the way, the political markets are another area in which the 1 percent use their ill-gotten gains to invest in legislation against the 99 percent. That does create jobs for corporate lobbyists. So the 1 percent will have less money to do that little thing. So let’s do the obvious thing; raise the minimum wage to $20 an hour.

The legal and logical difference between an owner operated business and a business structured on “organized money” (a limited liability corporation) is as obvious as the difference between a single worker and a large labor union.

Therefore, one last thing needs to be mentioned. There is always somebody who will say raising the minimum wage to $20 an hour will kill small mom and pop businesses. Conceded, those are mostly businesses that operate in something that kind of resembles a competitive business environment. Those businesses should be allowed to operate with a minimum wage of say, $$12-15 an hour. However, since limited liability corporations are nothing more than “organized money,” as FDR accurately put it, and since they operate in a more collusive environment, those corporations are a totally different animal from owner operated companies, and should be made to pay the $20 minimum wage, which should also be indexed to inflation.

pFrom StoctCharts.com. History of the Dow Jones Industrials

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Here’s what the press tells you.

The New York Times
Tuesday, September 10, 2013

“The top 10 percent of earners took more than half of the country‚Äôs total income in 2012, the highest level recorded since the government began collecting the relevant data a century ago, according to an updated study by the prominent economists Emmanuel Saez and Thomas Piketty.

The top 1 percent took more than one-fifth of the income earned by Americans, one of the highest levels on record since 1913, when the government instituted an income tax.

The figures underscore that even after the recession the country remains in a new Gilded Age, with income as concentrated as it was in the years that preceded the Depression of the 1930s, if not more so.

High stock prices, rising home values and surging corporate profits have buoyed the recovery-era incomes of the most affluent Americans, with the incomes of the rest still weighed down by high unemployment and stagnant wages for many blue- and white-collar workers.”

Continue reading the rest of the story–the-rich-get-richer-through-the-recovery

Here’s what you should know the press isn’t telling you.

“Surging corporate profits” and “high stock prices” are cited as a reason for the uneven distribution of income during this recovery. However, what isn’t cited is that the surging corporate profits are due in large part to shipping jobs over seas, which redistributes income from the 99 to the 1 percent. Free trade treaties have also paved the way for US corporations to create lesser paying jobs overseas, rather than higher paying jobs here, and this does the exact same income redistribution thing.

The difference between the old, higher US wages and the new, lower wages goes into the pockets of the 1 percent via higher corporate profits, rising dividends and surging share prices. Now you can understand what’s going on.

According to the Federal Reserve Bank, one to three million jobs are shipped overseas every year, thanks to free trade treaties. Millions more per year are created overseas, but these would have been created here in the absence of free trade treaties, which are really income redistribution treaties.

The Obama administration is negotiating to redistribute more income from the 99 to the 1 percent via the largest free income redistribution trade treaty of them all; the Trans Pacific Partnership. Studies are showing this treaty will push middle class income down and redistribute the difference between the old wages and the new lower wages into the pockets of the uber rich. See study-mega-trade-deal-the-trans-pacific-partnership-would-make-most-americans-poorer.

In addition, the study that shows the 1 percent are stealing 95 percent of all income growth doesn’t count all the cash stashed away by the 1 percent in offshore accounts to avoid taxes. The study is counting only cash declared as taxable income. This means the 1 percent have a greater share of the national total income than the study reports. The share of national income the 1 percent have stolen via legislation is much closer to 34  percent than what the study cites.

And finally, the rich have received massive bailouts to the trillions of dollars while the middle class has struggled under the vicious financial assaults in the political markets of the 1 percent. See breakdown-of-the-26-trillion-the-federal-reserve-handed-out-to-save-rich-incompetent-investors-but-who-purchase-political-power. These bailouts have enabled the rich to continue to purchase legislators and legislation, such as the South Korea free trade treaty of 2012. So we’re really talking about massive government corruption, all the way from the white house through the congress and into the US Supreme Court. It’s one giant rigged game against the  middle class.

These are the reasons the rich are stealing 95 percent of all income growth over the last four years.

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As reported here last month, Detroit went bankrupt because of free trade treaties that paved the way for shipping millions of jobs overseas to low wage nations, and they also paved the way for US corporations to create jobs overseas, rather than here. But that’s not entirely true. It’s like looking at a bloody finger and deciding that the problem of the finger is that it’s bloody, and therefore it must have a cut. Of course, that’s true, but it doesn’t tell you how it got cut, which is the real problem.

Detroit went bankrupt because your corrupt government has been redistributing income from the 99 to the 1 percent via “freely redistributing your income trade treaties” for over thirty years.

When a job is shipped overseas, the difference between the old, higher US wages, and the new, lower overseas slave labor wages, goes directly into the pockets of the 1 percent via higher corporate profits, rising dividends and surging share prices.

According to the Federal Reserve, between one to three million jobs are shipped from the US to overseas locations every year. That’s a lot of income being redistributed every year via the corporate trade treaty conduit. That’s also a ton of local, state and federal tax dollars being redistributed to the 1 percent every year. That doesn’t even count the jobs that are created overseas by US corporations because these freely trading your income redistribution treaties have legally paved the way.

How many jobs has Detroit lost due to these treaties and other trade scams?

In 1950, before Nafta, before the establishment of the free trade Maquiladora District with Mexico, before China received most favored trade status, and before a ton of this other stuff, roughly 176,000 manufacturing jobs were located within the city limits of Detroit. Nowadays, after these trade scams, only 15,000 remain in Detroit, which is geographically larger than it was 63 years ago.

Those 176,000 jobs supported a ton of other jobs, such as supermarkets, clothing stores, accountants, auto suppliers, and a lot more. All of these jobs provided the tax dollars for infrastructure, such as road maintenance, sewer systems, education, fire and police departments. Those tax dollars created a reasonable living environment . Now those jobs are gone. The tax dollars are gone.

Where did the money go that enabled 176,000 jobs to support a robust city environment? The jobs were shipped away, and all of that cash is now pocket change for the 1 percent via “freely trading your income to the rich treaties.”

In other words, Detroit and other cities are bankrupt because your corrupt government representatives, like Wall Street Senator Ron Wyden and Congressman John Boehner, voted to redistribute other people’s income to the 1 percent. Detroit is bankrupt, making it a casualty in the Koch Brothers war (and others of the 1 percent) against the middle class.

This war continues. Other cities will fall victim. The middle class is under siege, and we’re losing the war.

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The corporate press has done their duty to mislead the American people about mortgage interest rates. Here’s how.

Federal Reserve Chairman Ben Bernanke announced in June that he intended the Fed to stop propping up the economy by buying worthless bonds from stupid investors. The process is called quantitative easing and increases the money supply by nearly a trillion dollars every year.  Soon after  the announcement, the corporate press dutifully claimed that mortgage interest rates were rising because of Bernanke’s statement. Let’s see if that’s true.

Bernanke announced last Thursday that the Fed intends to keep rates where they are until the unemployment rate drops to its 2008 level. The stock markets around the world soared on that news. The Dow Jones climbed to a record high of 15,423 on Bernanke’s announcement.

What the corporate propaganda media hasn’t told us is that mortgage applications are near historic lows. Thirty year fixed mortgages are the only kind that are up. Mortgage interest rates have risen to around 4.5 percent, a rise of roughly 38 percent from around 3.25 percent just six months ago.

The big banks have illegally conspired to take millions of homes off the market, thereby increasing prices. By illegally rigging the housing market, the banksters have forced people to dive into the market before the illegally rising prices put them out of financial range of owning homes. This stampede has driven interest rates higher, and not Bernanke’s June announcement.

It’s possible that Bernanke’s announcement, and the banks illegally driving housing prices up, have both played a role in the upward movement of mortgage interest rates. We’ll see how far they go down now. Although, to be blunt, it already looks like the housing market bubble is already imploding, as I wrote earlier. In which case, home mortgage interest rates should drop anyway regardless of the actions of the Fed.

Check out the link below for more on Bernanke’s Thursday announcement.

US markets hit record highs with Federal Reserve interest rate pledge–The Guardian UK

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CEO’s have shipped tens of millions of our jobs away, on an average of one to three million a year, which has severely weakened our tax base, and redistributed trillions of dollars from the 99 to the 1 percent, leading to the greatest maldistribution of income and wealth in US history, and a nation teetering on third world status. They’ve poisoned us with genetically modified food, led us into wars with lies, polluted our air and caused an outbreak of Autism in the process, and gutted the US economy as badly as any butcher would a deer.

They’ve corrupted our government to the point where it is now a government of the rich, by the rich and for the rich.

They’ve corrupted both the conservative and the liberal wings of the US Supreme Court so that only one of the two wings of the 1 percent are represented and big money will almost always win in that court against the people and the US Constitution.

CEO’s have run their businesses into the ground and have been forced to take trillions of dollars in bailout money from the US government and the Federal Reserve.

Something corrupt and rotten is going on here. The graph below suggests the average CEO pay rate has been heading in the wrong direction for sixty-three years. The graph is also in error. This morning a new study by the Economic Policy Institute came out that shows CEO pay to be 273 times greater than average worker pay, and not 204, which the graph below shows. Perhaps CEO pay compared to average worker pay should be closer to 1:1, or better yet, 1/4:1.

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Yesterday, numerous corporate media outlets continued to show amazement at the recovery of the housing market. Home prices shot up last month at the highest rate in ten years. Here’s what they didn’t report.

The number of mortgage applications represents the demand of buyers to purchase homes, such as houses and condos. From May 5 to June 16 2013, the number of mortgage applications dropped -4.41 percent. What’s more, the number of mortgage applications has remained near historic lows for years. So how can the demand for homes drop while the prices of homes sky rockets?

It’s easy. The big banks, with the approval of the Obama Justice Department, have conspired to take almost two million homes off the market during the last two years. In other words, they’re violating US laws, such as the Sherman Anti-Trust Act. The big banks have also slowed, and in some cases stopped, foreclosing on homeowners in an effort to push home prices higher.

This all redistributes income from the 99 to the 1 percent. First of all, those trillions of dollars of worthless bonds backed by home loans will regain value as the 99 percent pay illegally inflated prices for homes, and those bonds are almost all owned by the 1 percent and the institutional investors (such as Goldman Sachs and hedge funds). Governments and the Federal Reserve own a ton of them, too.

Of course, the 99 percent are now paying for homes at artificially and illegally inflated prices, and the banks and their wealthy shareholders and worthless CEOs are reaping all the profits of this conspiracy in restraint of trade.

The situation is worse for home buyers than I’m stressing because the illegal curtailment of supply is pushing home prices up; buyers are bidding against one another for an artificially dwindling supply of homes. That also means they’re bidding up the price of home mortgages, the interest rates, which are also rising. It’s a perfect scam since the US Department of Justice won’t do anything about it.

In other words, through illegal actions, and with US government blessings, the banksters are making huge profits on homes they’ve forclosed on and with artificially and illegally rising interest rates.

Check out the link below for the number of mortgage applications.

Data: mortgage applications

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