July 2008

Wall Street's Haute Con Job

Submitted by on

For those of you who are familiar with my writing, you've probably seen me use the term "Wall Street exists to separate you from your money."

It occurred to me the other day that I need to justify that opinion. Therefore here is a partial list of reasons why you should keep your money out of the hands of the Wall Street crooks and banksters. This article will not encompass every way that Wall Street steals from average people like you and me, but it might inform you of a few ways that you may not have been aware of.
As the old saying goes, "Forwarned is forearmed."

So without further delay, here's a list of ways that you are being robbed, day after day, year after year.

I can think of 62,000 reasons why John Stossel is wrong!

Why oh why does this man irritate me so? Now don't get me wrong, John Stossel is probably a nice man. But for a man who can garner audiences, he is "dangerous" (well not really, but the guy's on TV and he is on the ra-ra free market Right's side promulgating this crap) with his half ass grasp on our economy. Recently, on Daily Kos's evil twin, he wrote up a piece on how the economy really isn't doing bad. That it was all media hype.

The Obama Nation: Class, Color, and the "Creative Class" in American Politics

I am a man. I am from "Middletown". "Middletown" is my home.

For four years now, I've always had people ask me where "Middletown" is. But the truth is that more than what "Middletown" is what Muncie, Indiana was. The quintessential American town.

Chevy on 8th Street. Borg Warner out on Kilgore. Westinghouse on the south side. And Ball Brothers, which gave the town's public university its name. The union made us strong, and the working class stood proud and strong.

The deprecation, denigration, and contempt for the working class that the Lynds found when they came to the city 40 years before was gradually disappearing. The children of the working class were able to attend the local state university, and go on to become the college-educated middle class.

Surprise 2! Positive yield curves haven't always been positive for the economy

Readers of my diaries probably know that I consider the bond market to be one of the most solid indicators of what lies ahead for the economy. In fact, the stock market is a leading economic indicator, and the bond market leads even that.
In 2006 and 2007 the bond market went into a mild inversion, i.e., interest rates on short term bonds were higher than rates on long term bonds. This is a historically accurate indication of recessions about 12 months further out. It does appear that we have dutifully slipped into recession in the early part of 2008 (although we may not "know" it officially until the final revisions to economic numbers is made official - several years from now!)

Surprise! Negative interest rates don't always mean high inflation

In the last couple a days a lengthy brief by Aaron Krowne, famous for the "Mortgage Broker Implode-O-Meter", titled Debate Over: It's Hyperinflation (and US Economic Collapse) has gotten extensive attention. The title is pretty self-explanatory. Krowne claims that the Fed's recent negative interest rate policy is going to provoke hyperinflation:

the one thing that is different this time; the only thing on the planet that could truly be the cause of the EXTREME price action in oil, are the actions of the Fed. In specific I mean holding interest rates at the ungodly low rate of 2% -- below even their own doctored inflation reading (which is around 4%); and hell, below even their core inflation reading, which is a percent lower or so.

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