The Economic Recovery Is Moving Along Quite Well – For The Boys Down On Wall Street

If you are part of the Wall Street establishment, the economic recovery is moving along quite well.  Many of the biggest firms on Wall Street just handed out record-setting bonuses, the Stock Market has been moving up steadily and the DOW is back up to around 11,000.  Profits at the top banks have been quite impressive lately.  Bank of America, JPMorgan Chase, Citigroup and Wells Fargo combined for first quarter profits of $13.4 billion – the most in almost three years.  Yes, life is quite good down on Wall Street these days.  People are still buying fast cars, big yachts and homes in the Hamptons.  It is almost as if “the greatest financial crisis since the Great Depression” didn’t even happen.  Things are quickly getting back to “normal” for the banking elite and to many it seems like there are a lot more smiles down on Wall Street than there have been in a long, long time.

Bank of America’s chief executive officer, Brian T. Moynihan, is being quoted by Reuters as saying that “the worst of the credit cycle is clearly behind us” and that the economic growth we are experiencing is “real”.

JPMorgan CEO Jamie Dimon is quoted as saying that the U.S. economy may be poised for “a strong recovery”.

And why wouldn’t they say these things?  Profits are up.  Their stock portfolios are up.  They are getting record bonuses.  They know that if anything does go wrong again that their friends in Washington D.C. will bail them out because they are “too big to fail”.

But for tens of millions of other Americans, the economy seems like it is getting worse than ever.  It is hard to explain the gut-wrenching agony that many highly-educated and highly-qualified American workers are going through as they send out hundreds of resumes only to get no response.  Or the absolute frustration of only being able to get a very low paying retail job and realizing that it will not even be able to pay the mortgage – much less support an entire family.  Or the soul-crushing despair of working two or three jobs and still not being able to pay the bills at the end of the month.

But these are the daily realities that millions of Americans must face now.  The truth is that there are not nearly enough jobs for everyone.  The number of unemployed Americans per job opening hit 5.5 in February.  It is like we are all caught in some bizarre game of musical chairs, and the losers end up destitute and out in the street.

Even many of those who can get jobs find themselves in bad situations.  Gallup’s underemployment measure hit 20.0% on March 15th.  That was up from 19.7% two weeks earlier and 19.5% at the start of the year.  A lot of very educated, very qualified people find themselves slaving away at jobs that high school students are qualified for.

But the ones being hurt the worst by this unemployment epidemic are the poor.  Check out the following chart.  At the end of 2009, the unemployment rate for those at the top end of the income scale in the United States was about 3%.  For those at the bottom of the income scale, the unemployment rate was about 30%….

It isn’t the boys down on Wall Street that are losing their homes and their jobs.

No, they are “too big to fail”.

It is millions of ordinary Americans that are losing their homes and their jobs.

And things keep getting worse.

According to RealtyTrac, foreclosure filings were reported on 367,056 properties in the month of March.  This was an increase of almost 19 percent from February, and it was the highest monthly total since RealtyTrac began issuing its report in January 2005.

Not only that, but RealtyTrac projects that there will be a total of 4.5 million home foreclosures by the end 2010.  If you figure that there are approximately 4 people per household, that is another 18 million people that will be facing the pain of a foreclosure filing.

For many Americans, losing their home to foreclosure is just too much.  For example, one man in Ohio actually decided to bulldoze his own home rather than let the bank take it in foreclosure proceedings.

Because of the extreme economic conditions, millions of Americans are in severe pain and are becoming increasingly desperate.  In some of the most depressed areas, crime is absolutely spiralling out of control.  So far this year in Detroit, car thefts are up 83%, robberies are up 50%, burglaries are up 20% and property destruction is up 42%.

Adding to all of this economic despair is the fact that food and gas prices are starting to shoot up.

In some areas of the United States, people are already paying as much as $3.50 for a gallon of gasoline, and many experts are now predicting that gasoline could hit $4.00 a gallon by the end of 2010.

Not only that, but wholesale food prices rose 2.4% in March, matching the biggest gain in 26 years.

So while the economic recovery is buzzing along quite well down on Wall Street, the reality is that for millions of other Americans things are really hard.  In fact, not even the smaller banks are experiencing much of a recovery.  The FDIC’s list of problem banks just hit a 17-year high.

No, the main beneficiaries of this “economic recovery” are the boys over on Wall Street.  They should enjoy it while it lasts, because even harder economic times are on the way, and the reality is that none of us will be able to completely escape the economic pain that is coming.

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What Is He Up To Now? George Soros Declares That Gold Is Now “The Ultimate Bubble”

What in the world is George Soros up to now?  At the 2010 World Economic Forum in Davos, Switzerland Soros recently made the following statement: “When interest rates are low we have conditions for asset bubbles to develop, and they are developing at the moment. The ultimate asset bubble is gold.”  So is Soros trying to scare people away from gold?  The truth is that the price of gold did rise about 40 percent last year.  In the current economic environment, there has been a flight to safety as nervous investors have flocked to precious metals such as gold, silver and platinum.  But are these bad investments that are overvalued right now?  Not at all.  The truth is that gold and silver are just about the only things that have held their value over the past 100 years.  An ounce of gold could buy you a really nice suit 100 years ago and an ounce of gold can buy you a really nice suit today.  But now that it is starting to come out that there could be massive reserves of gold and oil in Haiti, we should expect the ongoing manipulation of the precious metal markets only to intensify.  The truth is that the big dogs like Soros want everyone else to get out of gold and silver so that they can swoop in and get more for themselves.

If you are looking for a bubble, you don’t have to look any farther than the U.S. stock market.  Remember all of that “bailout” money and “stimulus” money that the U.S. government injected into the economy?  Well, it didn’t help you much, did it?  Nope.  So where did it go?  It went to pumping up Wall Street.  In a recent article, Bob Chapman did a great job of explaining what is happening….

Liquidity is not flowing into the economy it is pouring into Wall Street to aid and abet more speculation, which has sent the Dow from 6600 to 10,700.

That is why some analysts are calling this a “jobless” recovery.  They think that because the stock market has gone up we are having a recovery.  But it is a lie.  The reality is that the stock market is experiencing a “sucker’s rally” and all the insiders are busy selling their holdings off into that rally as Chapman explains further down in his article….

It should be noted that insiders are selling into the never-ending rally, and mutual funds have very little money flow coming into the funds. That, of course, is our government at work manipulating the market. Just last week insiders bought $18 million worth of shares and sold $419 million.

But let’s not just blame Wall Street.

They are not the only ones responsible for the mess that we are in.

The truth is that we have all made bad choices.  We have all bought stuff made in China for years and years just because it was a few cents cheaper.  We knew that it would put some of our neighbors out of work eventually but we didn’t care as long as we could save a buck or two. 

All we cared about was the lowest price.  In fact, for decades the U.S. government made obscenely lopsided trade deals with foreign nations (that were very much not in our favor) just so that we could get cheaper goods for the American consumer.  We were told that anything that was good for the “consumer” was good for the economy.  “Free trade” (or in other words, other countries getting to send us all the cheap stuff they wanted to) was going to be the solution to all of our problems.

But it wasn’t.

Instead, we found out that there was a very high cost to those low prices.

In his excellent article entitled “The Wal-Mart Model of Self-Destruction: Lowest Prices, Always”, Charles Hugh Smith captured the high cost of our obsession with low prices beautifully….

The propaganda of marketing has so hollowed out American culture that most citizens cannot recall a time that “Consumerism” wasn’t the unofficial religion of American society. And what is the First Commandment of “consumerist religion”? The lowest price is all that matters.

Quality doesn’t matter; we’re going to move/throw it away anyway.

Who made it doesn’t matter. The idea that you might pay more to keep your neighbor employed is akin to worshipping the Devil: all that matters is the lowest price.

The sad thing is that many of you who are reading this article will keep running out to bloated globalist retailers like Wal-Mart just to save a few pennies.  It doesn’t matter that their stores are filled with cheap garbage made in virtual sweat shops all over the globe and that Wal-Mart has probably decimated a large percentage of the local businesses in your area since they moved in.  But on the bright side, they do pay slightly over minimum wage and they do provide part-time employment for many of the people in your area.  Perhaps you can get a job with them when your job gets shipped overseas too.

The truth is that we all need to quit being “consumers” and we all need to start participating in our communities once again.  Instead of supporting a big global chain that takes all of the profits out of your local community, why don’t you go visit the struggling small business down the street instead?  Instead of pumping your cash into the giant shell game known as the stock market, why don’t you help a family member start a business or put it into something real like gold and silver instead?

We are all supporting the current globalist system by putting money into their banks, by investing in their stocks and by endlessly shopping in their stores. 

Imagine what would happen if we all suddenly decided to stop.