“In a free market, people earn money by working (income) or by saving and investing it (capital growth). But credit-based money needed neither work nor saving; you just had to know the right people. Private banks, aided and abetted by the Federal Reserve, could create as much credit money as they pleased and feed it to their cronies on Wall Street. The new money was then transformed as miraculously as water into wine. For the privileged insiders it was almost free; the Fed made sure of that. But for consumers, it became a heavy burden of debt. And for the economy, it became an inflation mechanism for financial bubbles. The most recent blew when the banking and mortgage industries (part owned by the feds by way of Fannie and Freddie) lent trillions of dollars to homebuyers, who ended up with debt they couldn’t afford for houses they didn’t need. In 1995, the subprime loan market was about $65 billion. By 2007, it had ballooned to $1.3 trillion – a 1,900% increase.” – Bill Bonner
What Bill Bonner was describing in this quote was the economic crisis of September 2008. A remarkably large number of American citizens seem completely unaware of our governments response to this crisis over the last almost nine years: they have re-inflated that bubble and made it three times larger than it was in 2008.
The majority of Americans seem blissfully unaware of this. In a nutshell this is how it works: the Federal Reserve creates credit at a near zero percent interest rate, people with the proper political connections borrow this money for free, they then use this credit to leverage the stock market, by introducing ever more credit into the stock market they drive the prices ever higher. This is what is happening in simple terms. If you are properly connected you can get phenomenally rich for doing absolutely nothing but borrowing money for free.
People with access may also collateralize and rehypothecate the credit. It is free money for those who are connected.
This is the ultimate form of government largesse, crony capitalism, political corruption and getting rich based solely on whom you know.
This is politician’s stealing your money by the trillions and giving it to their friends.
Understand that you the American taxpayer are on the hook for this. We are well down the road to serfdom under these policies and four or eight more years of this and the wealth redistribution to the wealthiest will be complete. A few more years of this and your opportunity to escape the increasing poverty will be diminished to nearly zero.
The saddest part of this is that nearly all the Democrats are either too naïve to understand that this is happening and that this is what they voted for, or they have too much pride and ego to admit that this is what has happened. What you need to know is that each Democrat and most of the Republicans have stated or implied that they would continue these policies.
Each and every politician needs to be questioned on these policies and if they would continue them. Each politician also needs to be asked what their escape plan is if they do not support these policies.
I want people to engage and understand what is happening. I am just aghast at the number of people who have no idea what so ever as to what occurs in their country, yet they vote. These people in Washington truly wish to separate you from your money and divide your money up among their friends. Somehow many people, and nearly all Democrats and Progressives, have decided that this is a wonderful idea.
We need to stop being Democrats and Republicans and start being Americans or we are likely to give away the whole store in the very near future. 93% of Americans are losing net wealth under these policies and losing net wealth at a record setting rate. 7% of Americans are gaining the wealth the other 93% are losing.
93% of Americans should be able to unite and say ‘No more’ to these policies. Put your pride and ego aside and do the right thing.