Wealthy

The Dow Hits An All-Time High! Translation: A Bubble Is Always Biggest Right Before It Bursts

The Dow Hits An All-Time High! Translation: A Bubble Is Always Biggest Right Before It Bursts - Photo by KazekiReckless money printing by Federal Reserve Chairman Ben Bernanke has pumped up the Dow to a brand new all-time high.  So what comes next?  Will the Dow go even higher?  Hopefully it will.  In fact, it would be great if the Dow was able to hit 15,000 before it finally came crashing down.  That would give all of us some more time to prepare for the nightmarish economic crisis that is rapidly approaching.  As you will see below, the U.S. economy is in far, far worse shape than it was the last time the Dow reached a record high back in 2007.  In addition, all of the long-term trends that are ripping our economy to shreds just continue to get even worse and our debt just continues to explode.  Unfortunately, the Dow has become completely divorced from economic reality in recent years because of Fed manipulation.  All of this funny money that the Federal Reserve has been cranking out has made the wealthy even wealthier, but this bubble will not last for too much longer.  What goes up must come down.  And remember, a bubble is always biggest right before it bursts.

Fortunately, it looks like an increasing number of people out there are starting to recognize that the primary reason why stocks have been going up is because of the Fed.  Just check out this excerpt from a recent article by the USA Today editorial board…

The Federal Reserve’s purchases have driven interest rates to near zero. This has stimulated the economy but not without cost. Savers, particularly older ones trying to live on income from their investments, are starved for safe options. They’ve been forced into stocks, which is one reason the market has been acting as if it’s on steroids. Further, with borrowing costs low, Congress and the White House have less incentive to rein in the national debt. Rock-bottom interest rates have also distorted markets.

The best indication that the Fed’s bond-buying purchases are pushing stocks up artificially is that investors run for cover whenever there is a hint that the Fed might change course, as happened recently. On Monday, billionaire superinvestor Berkshire Hathaway CEO Warren Buffett told CNBC that markets are on a “hair trigger” waiting for signs of change from the Fed. The market is “hooked on the drug” of easy money, Dallas Fed President Richard Fisher told Reuters.

Fisher’s comparison of Fed policies to a drug is apt. Markets might not like the idea of the drug being withdrawn now, when the Fed holds a portfolio of $3 trillion. But the withdrawal symptoms will be a lot worse once the portfolio grows to $4 trillion, or more.

Those sentiments were echoed by Gordon Charlop, a trader at Rosenblatt Securities, during a recent appearance on CNBC…

“The Wizard of the Fed, Ben [Bernanke], has done a great job propping up the market, but the question is how does the wizard move the pin from the balloon without blowing the whole thing up?” said Charlop. “This is getting out of balance and he’s got to figure out a way to justify the levels that we’ve gotten to and draw back on some of the stimulus.”

Of course, in the end, the bursting of this bubble is going to be very messy.

The Fed has dramatically distorted the market in an attempt to make things look good, but now the financial markets are completely and totally addicted to easy money.  Is there any chance that the Fed will be able to take away that easy money without causing disaster?

There are only a few ways that this current scenario can play out.  The following is what Stanley Druckenmiller recently told CNBC…

“I don’t know when it’s going to end, but my guess is, it’s going to end very badly; and it’s going to end very badly because, again, when you get the biggest price in the world, interest rates, being manipulated you get a misallocation of resources and this is going to end in one of two ways – with a malinvestment bust which we got in ’07-’08 (we didn’t get inflation). We got a malinvestment bust because of the bubble that was created in housing. Or it could end with just monetizing the debt and off we go in inflation. So that’s a very binary outcome – they’re both bad.”

What the Fed has done to the money supply in recent years has been absolutely unprecedented.  Just check out how our money supply has skyrocketed since the last financial crisis…

M1 Money Supply

So what happens when the amount of money in an economy rises rapidly?

Well, if I remember Econ 101 correctly, that would mean that prices should go up.

And that is exactly what has happened.  And since most of the money that the Fed has created has gone into the financial system first, it should not be a surprise that we have seen a bubble in financial assets.

In a previous article that I wrote last September, I warned that QE3 would cause stocks to go up…

So what have the previous rounds of quantitative easing accomplished?  Well, they have driven up the prices of financial assets.  Those that own stocks have done very well the past couple of years.  So who owns stocks?  The wealthy do.  In fact, 82 percent of all individually held stocks are owned by the wealthiest 5 percent of all Americans.  Those that have invested in commodities have also done very nicely in recent years.  We have seen gold, silver, oil and agricultural commodities all do very well.  But that also means that average Americans are paying more for basic necessities such as food and gasoline.  So the first two rounds of quantitative easing made the wealthy even wealthier while causing living standards to fall for all the rest of us.  Is there any reason to believe that QE3 will be any different?

Of course not.

So will stocks continue to go up indefinitely?

No way.

As I have also written about previously, the money printing that the Fed is doing right now is not nearly enough to stop the mammoth derivatives crisis that is coming.

A derivatives crisis was one of the primary reasons for the financial crash of 2008, but most Americans still have no idea what derivatives are.

They can be very complex, but I think that it is easiest just to think of them as side bets.

When someone buys a derivative, they are not buying anything real.  They are simply betting that something will or will not happen.

For example, if you bet $100 that the Chicago Cubs will win the World Series this year, would you be “investing” in anything real?

Of course not.

Well, it is the same with most derivatives.

Today, Wall Street has become the biggest casino in the entire world and trillions of dollars of very reckless bets have been made.

In fact, most Americans would be absolutely shocked to learn how exposed to derivatives some of our largest financial institutions are.  The following is an excerpt from one of my previous articles entitled “The Coming Derivatives Panic That Will Destroy Global Financial Markets“…

It would be hard to overstate the recklessness of these banks.  The numbers that you are about to see are absolutely jaw-dropping.  According to the Comptroller of the Currency, four of the largest U.S. banks are walking a tightrope of risk, leverage and debt when it comes to derivatives.  Just check out how exposed they are…

JPMorgan Chase

Total Assets: $1,812,837,000,000 (just over 1.8 trillion dollars)

Total Exposure To Derivatives: $69,238,349,000,000 (more than 69 trillion dollars)

Citibank

Total Assets: $1,347,841,000,000 (a bit more than 1.3 trillion dollars)

Total Exposure To Derivatives: $52,150,970,000,000 (more than 52 trillion dollars)

Bank Of America

Total Assets: $1,445,093,000,000 (a bit more than 1.4 trillion dollars)

Total Exposure To Derivatives: $44,405,372,000,000 (more than 44 trillion dollars)

Goldman Sachs

Total Assets: $114,693,000,000 (a bit more than 114 billion dollars – yes, you read that correctly)

Total Exposure To Derivatives: $41,580,395,000,000 (more than 41 trillion dollars)

That means that the total exposure that Goldman Sachs has to derivatives contracts is more than 362 times greater than their total assets.

When the derivatives crash happens, there won’t be enough money in the entire world to fix it.

So enjoy this little stock market bubble while you can.

It will end soon enough.

And of course stocks should not be this high in the first place.  The underlying economic fundamentals do not justify these kinds of stock prices whatsoever.

A recent CNN article noted that the last time the Dow hit a record high that unemployment in the U.S. was much lower…

Consider this. When the Dow hit its now old record high back in October 2007, the economy was still in good shape — although it was just a few months away from the beginning of the Great Recession.

The unemployment rate in October 2007 was 4.7%. In January of this year, the unemployment rate was 7.9%.

And that same article also pointed out that GDP growth and housing prices were also much stronger back in 2007…

Gross domestic product grew 3% in the third quarter of 2007. Revised figures from the government last week showed that GDP in the fourth quarter of 2012 rose a scant 0.1%. But I guess that’s good news considering the first estimate showed a 0.1% decline.

And despite all the hoopla about the steady recovery in the housing market over the past year, real estate is still in a bear market. The most recent level of the S&P Case-Shiller 20-City Home Price Index, one of the most widely watched gauges of the health of housing, is still 24% below where it was in October 2007.

We have never even come close to recovering from the last economic crisis.  Most Americans seem to have forgotten how good things were back then, but a recent Zero Hedge article included some more points of comparison between October 2007 and today…

  • Dow Jones Industrial Average: Then 14164.5; Now 14164.5
  • Regular Gas Price: Then $2.75; Now $3.73
  • GDP Growth: Then +2.5%; Now +1.6%
  • Americans Unemployed (in Labor Force): Then 6.7 million; Now 13.2 million
  • Americans On Food Stamps: Then 26.9 million; Now 47.69 million
  • Size of Fed’s Balance Sheet: Then $0.89 trillion; Now $3.01 trillion
  • US Debt as a Percentage of GDP: Then ~38%; Now 74.2%
  • US Deficit (LTM): Then $97 billion; Now $975.6 billion
  • Total US Debt Oustanding: Then $9.008 trillion; Now $16.43 trillion
  • US Household Debt: Then $13.5 trillion; Now 12.87 trillion
  • Labor Force Particpation Rate: Then 65.8%; Now 63.6%
  • Consumer Confidence: Then 99.5; Now 69.6

And of course anyone that reads my site regularly knows that the U.S. economy has been in a state of persistent decline over the past several years.

Just consider the following data points…

-The percentage of the civilian labor force in the United States that is actually employed has been steadily declining every single year since 2006.

-In 2007, the unemployment rate for the 20 to 29 age bracket was about 6.5 percent.  Today, the unemployment rate for that same age group is about 13 percent.

-According to one study, 60 percent of the jobs lost during the last recession were mid-wage jobs, but 58 percent of the jobs created since then have been low wage jobs.

-Median household income in America has fallen for four consecutive years.  Overall, it has declined by more than $4000 during that time span.

-At this point, an astounding 53 percent of all American workers make less than $30,000 a year.

That is the other side of the Fed’s insidious money printing.  Incomes in the United States are going down, but the cost of living is skyrocketing.  This is squeezing millions of Americans out of the middle class…

When Debbie Bruister buys a gallon of milk at her local Kroger supermarket, she pays $3.69, up 70 cents from what she paid last year.

Getting to the store costs more, too. Gas in Corinth, Miss., her hometown, costs $3.51 a gallon now, compared to less than three bucks in 2012. That really hurts, considering her husband’s 112-mile daily round-trip commute to his job as a pharmacist.

Perhaps you can identify with this.  Perhaps your paychecks are about the same as they used to be back in 2007 but the cost of living has gone up dramatically since then.

I wish I could tell you that things were going to get better, but unfortunately there are all kinds of indications that things are about to get even worse for the U.S. economy.  If you doubt this, just read this article and this article.

Yes, the Dow is at an all-time high.  But do you want to know what else has hit an all-time high up in New York?

Homelessness.

The following is from a recent report in the New York Times…

An average of more than 50,000 people slept each night in New York City’s homeless shelters for the first time in January, a record that underscores an unsettling national trend: a rising number of families without permanent housing.

And apparently families and children have been hit particularly hard over the past year…

More than 21,000 children—an unprecedented 1% of the city’s youth—slept each night in a city shelter in January, an increase of 22% in the past year, the report said, while homeless families now spend more than a year in a shelter, on average, for the first time since 1987. In January, an average of 11,984 homeless families slept in shelters each night, a rise of 18% from a year earlier.

Of course New York is far from alone.  There has been a surge in homelessness all over the United States.  In fact, at this point more than a million public school students in the United States are homeless.  This is the first time that has ever happened in U.S. history.

But the Dow just hit a record high so we should all be wildly happy, right?

Hopefully we can get more Americans to understand that the “prosperity” that we are enjoying right now is just an illusion.  It isn’t real.  It is a bubble created by reckless money printing by the Fed and reckless borrowing by the U.S. government.  If you can believe it, the U.S. government borrowed another 253 billion dollars during the month of February alone.

The Fed and the U.S. government will continue to engage in this kind of reckless behavior until the bubble eventually bursts.

So what should all the rest of us do?

We should be feverishly preparing for the hard times that are coming.  As Daisy Luther recently wrote about, one of the most important things to do is to create an emergency fund.  Instead of going out and blowing your money on the latest toys and gadgets, set some money aside so that you will have something to live on if the economy crashes and you suddenly lose your income.

Just remember what happened back in 2008.  Millions of Americans suddenly lost their jobs, and because many of them had no financial reserves, a lot of Americans suddenly could not pay their mortgages and they lost their homes.

So put some money away in a place where it will be safe – and that does not mean the stock market.

Jim Cramer of CNBC and a lot of the other talking heads on the financial news channels are trying to encourage ordinary Americans to jump into “the bull market” right now and make some money, and many people will take their advice.

But the truth is that a bubble is always biggest right before it bursts.

This bubble is awfully big right now, and I don’t know how much larger it can possibly get.

Stock Market Bubble

Abolish The Income Tax: You Won’t Believe Who Is Getting Away With Paying Zero Taxes While The Middle Class Gets Hammered

Abolish The Income Tax - You Won't Believe Who Is Getting Away With Paying Zero Taxes While The Middle Class Gets Hammered - Photo by TravisThe federal income tax is a bad joke and it needs to be abolished.  All over the nation, hard working American families are being absolutely crushed by oppressive levels of taxation, and our politicians are constantly coming up with new ways to extract money from all of us every single year.  Meanwhile, many ultra-wealthy Americans and many of the most profitable corporations in the country pay little to nothing in taxes.  In fact, as you will see below, there are dozens of very prominent corporations that make billions of dollars in profits and yet don’t pay a dime in taxes.  Tax avoidance has become a multi-billion dollar industry in the United States.  Those that have the resources to “play the game” use shell companies, offshore tax havens and the thousands of loopholes in our tax code to minimize their tax burdens as much as possible.  Meanwhile, the rest of us get absolutely hammered.  This is fundamentally unfair.  The federal income tax system is irreversibly broken at this point, and it is time to abolish it.  If you think that the federal income tax system can be “fixed”, then you probably have never studied it.  Our tax code is nearly 4 million words long and it is absolutely riddled with thousands of loopholes that favor big corporations and the ultra-wealthy.  We should come up with a better, fairer way to fund the government.  The United States once prospered greatly without a federal income tax, and it could do so again.

Many people simply do not believe that it is possible for corporations inside the United States to make billions of dollars in profits each year and not pay a dime in income taxes.

Well, according to a report put out by Public Campaign, that is exactly what is happening.  Posted below are numbers that come directly from their report.  30 large corporations are listed, and 29 of them had a tax burden for 2008 through 2010 that was less than zero even though they all made enormous profits.  And all 30 of them spent more on lobbying than they did on taxes.

The numbers that you are about to see are for 2008, 2009 and 2010 combined.  For “taxes paid”, please note that for 29 of the corporations a negative number is given.  That means that the net tax liability for 2008 through 2010 was actually less than zero.

After seeing these numbers, is there anyone out there that is still willing to claim that our tax system is “fair”?…

General Electric
U.S. Profits: $10,460,000,000
Taxes Paid: ‐$4,737,000,000

PG&E Corp.
U.S. Profits: $4,855,000,000
Taxes Paid: ‐$1,027,000,000

Verizon Communications
U.S. Profits: $32,518,000,000
­Taxes Paid: ‐$951,000,000

Wells Fargo
U.S. Profits: $49,370,000,000
­Taxes Paid: ‐$681,000,000

American Electric Power
U.S. Profits: $5,899,000,000
­Taxes Paid: ‐$545,000,000

Pepco Holdings
U.S. Profits: $882,000,000
­Taxes Paid: ‐$508,000,000

Computer Sciences
U.S. Profits: $1,666,000,000
Taxes Paid: ‐$305,000,000

CenterPoint Energy
U.S. Profits: $1,931,000,000
Taxes Paid: ‐$284,000,000

NiSource
U.S. Profits: $1,385,000,000
­Taxes Paid: ‐$227,000,000

Duke Energy
U.S. Profits: $5,475,000,000
­Taxes Paid: ‐$216,000,000

Boeing
U.S. Profits: $9,735,000,000
Taxes Paid: ‐$178,000,000

NextEra Energy
U.S. Profits: $6,403,000,000
­Taxes Paid: ‐$139,000,000

Consolidated Edison
U.S. Profits: $4,263,000,000
­Taxes Paid: ‐$127,000,000

Paccar
U.S. Profits: $365,000,000
­Taxes Paid: ‐$112,000,000

Integrys Energy Group
U.S. Profits: $818,000,000
Taxes Paid: ‐$92,000,000

Wisconsin Energy
U.S. Profits: $1,725,000,000
Taxes Paid: ‐$85,000,000

DuPont
U.S. Profits: $2,124,000,000
Taxes Paid: ‐$72,000,000

Baxter International
U.S. Profits: $926,000,000
­Taxes Paid: ‐$66,000,000

Tenet Healthcare
U.S. Profits: $415,000,000
Taxes Paid: ‐$48,000,000

Ryder System
U.S. Profits: $627,000,000
­Taxes Paid: ‐$46,000,000

El Paso
U.S. Profits: $4,105,000,000
­Taxes Paid: ‐$41,000,000

Honeywell International
U.S. Profits: $4,903,000,000
­Taxes Paid: ‐$34,000,000

CMS Energy
U.S. Profits: $1,292,000,000
­Taxes Paid: ‐$29,000,000

Con-­way
U.S. Profits: $286,000,000
Taxes Paid: ‐$26,000,000

Navistar International
U.S. Profits: $896,000,000
­Taxes Paid: ‐$18,000,000

DTE Energy
U.S. Profits: $2,551,000,000
­Taxes Paid: ‐$17,000,000

Interpublic Group
U.S. Profits: $571,000,000
­Taxes Paid: ‐$15,000,000

Mattel
U.S. Profits: $1,020,000,000
­Taxes Paid: ‐$9,000,000

Corning
U.S. Profits: $1,977,000,000
­Taxes Paid: ‐$4,000,000

FedEx
U.S. Profits: $4,247,000,000
Taxes Paid: $37,000,000 (a rate of less than 1%)

Total
U.S. Profits: $163,691,000,000
­Taxes Paid: ‐$10,602,000,000

Just look at that combined total again.

Those 30 companies had combined profits of more than 163 billion dollars during those three years, and yet the combined net tax liability of those companies was negative 10.6 billion dollars.

I wish I could make my taxes look like that.

Another company that is making headlines because of their taxes these days is Facebook.

It turns out that Facebook made more than a billion dollars in 2012 but did not pay a single dime in federal or state income taxes.  The following is from a report that was just released by Citizens for Tax Justice…

Earlier this month, the Facebook Inc. released its first “10-K” annual financial report since going public last year. Hidden in the report’s footnotes is an amazing admission: despite $1.1 billion in U.S. profits in 2012, Facebook did not pay even a dime in federal and state income taxes.

Instead, Facebook says it will receive net tax refunds totaling $429 million.

According to Businessweek, Facebook has an additional 2 billion dollars in tax credits that it will be able to use in future years…

Facebook says that it anticipates reducing its tax liability in the future by an additional $2.17 billion by using further net operating loss carry-forwards that it has banked.

And of course when it comes to abusing the tax system, the big Wall Street banks are some of the worst offenders.  The following is an excerpt from a report put out by the office of U.S. Senator Bernie Sanders…

—–

Here are just a few examples of how the corporations and Wall Street banks these CEOs work for have significantly harmed our economy and the federal budget:

1. Bank of America CEO Brian Moynihan

Number of Offshore Tax Havens in 2010? 371.

In 2010, Bank of America operated 371 subsidiaries incorporated in offshore tax havens. 204 of these subsidiaries are incorporated in the Cayman Islands, which has a corporate tax rate of 0%.

Amount of federal income taxes Bank of America would have owed if offshore tax havens were eliminated? $2.5 billion.

Bank of America has stashed $18.5 billion in offshore tax havens to avoid paying U.S. income taxes. Bank of America would owe an estimated $2.5 billion in federal income taxes if its use of offshore tax avoidance was eliminated.

Amount of federal income taxes paid in 2010? Zero. $1.9 billion tax refund.

Bank of America received a $1.9 billion tax refund from the IRS in 2010, even though it made $4.4 billion in profits.

Taxpayer Bailout from the Federal Reserve and the Treasury Department? Over $1.3 trillion.

During the financial crisis, Bank of America received a total of more than $1.3 trillion in virtually zero interest loans from the Federal Reserve and a $45 billion bailout from the Treasury Department.

2. JP Morgan Chase CEO James Dimon

Number of Offshore Tax Havens in 2010? 83.

In 2010, JP Morgan Chase operated 83 subsidiaries incorporated in offshore tax havens.

Amount of federal income taxes JP Morgan Chase would have owed if offshore tax havens were eliminated? $4.9 billion

JP Morgan Chase has stashed $21.8 billion in offshore tax haven countries to avoid payng income taxes. If this practice was outlawed, it would have paid $4.9 billion in federal income taxes.

Taxpayer Bailout from the Federal Reserve and the Treasury Department? $416 billion

During the financial crisis, JP Morgan Chase received a total of more than $391 billion in virtually zero interest loans from the Federal Reserve and a $25 billion bailout from the Treasury Department, while Jamie DImon served as a director of the New York Federal Reserve.

3. Goldman Sachs CEO Lloyd Blankfein

Amount of federal income taxes paid in 2008? Zero. $278 million tax refund.

In 2008, Goldman Sachs received a $278 million refund from the IRS, even though it earned a profit of $2.3 billion that year.

Number of offshore tax havens in 2010? 39.

In 2010, Goldman Sachs operated 39 subsidiaries in offshore tax haven countries.

Amount of federal income taxes Goldman Sachs would have owed if offshore tax havens were eliminated? $3.32 billion.

Goldman Sachs has stashed $20.63 billion in offshore tax haven countries to avoid paying income taxes. If this practice was outlawed, it would have paid $3.32 billion in federal income taxes.

Taxpayer Bailout from the Federal Reserve and the Treasury Department? $824 billion.

During the financial crisis, Goldman Sachs received a total of $814 billion in virtually zero interest loans from the Federal Reserve and a $10 billion bailout from the Treasury Department.

—–

Are you starting to get the picture?

The big banks and the big corporations make billions, but they pay nothing or next to nothing.

The rest of us bust our rear ends to try to get ahead, and we get gouged by dozens of different taxes.

Over time, the percentage of the overall tax burden shouldered by corporations has gotten smaller and smaller.

Back in 1950, corporate taxes accounted for about 30 percent of all federal revenue.  In 2012, corporate taxes accounted for less than 7 percent of all federal revenue.

These days, large corporations have become absolute masters at avoiding taxes.  In fact, there are many international tax havens that are doing a booming business in setting up sham headquarters for U.S. corporations.  For example, the city of Zug, Switzerland only has a population of 26,000 people but it is the headquarters for 30,000 companies.

But corporations are not the only ones doing this kind of thing.

The ultra-wealthy have also mastered the art of legally not paying taxes.

As I mentioned in a previous article, it has been reported that the global elite have up to 32 TRILLION dollars stashed in offshore banks around the globe.

With that amount of money, you could pay off the entire U.S. national debt and still have enough money left over to buy every product and service produced in the United States during an entire year.

It is time to admit that our tax system is broken.

Congress has had decades to fix it, and yet the abuses just keep getting worse.

What we are doing is not working.

We need to abolish the income tax.

If you are still not convinced that the federal income tax is an abomination and that we need to abolish it, here are some more shocking facts about our tax system from one of my previous articles about taxes…

1 – The U.S. tax code is now 3.8 million words long.  If you took all of William Shakespeare’s works and collected them together, the entire collection would only be about 900,000 words long.

2 – According to the National Taxpayers Union, U.S. taxpayers spend more than 7.6 billion hours complying with federal tax requirements.  Imagine what our society would look like if all that time was spent on more economically profitable activities.

3 – 75 years ago, the instructions for Form 1040 were two pages long.  Today, they are 189 pages long.

4 – There have been 4,428 changes to the tax code over the last decade.  It is incredibly costly to change tax software, tax manuals and tax instruction booklets for all of those changes.

5 – According to the National Taxpayers Union, the IRS currently has 1,999 different publications, forms, and instruction sheets that you can download from the IRS website.

6 – Our tax system has become so complicated that it is almost impossible to file your taxes correctly.  For example, back in 1998 Money Magazine had 46 different tax professionals complete a tax return for a hypothetical household.  All 46 of them came up with a different result.

7 – In 2009, PC World had five of the most popular tax preparation software websites prepare a tax return for a hypothetical household.  All five of them came up with a different result.

8 – The IRS spends $2.45 for every $100 that it collects in taxes.

9 – According to The Tax Foundation, the average American has to work until April 17th just to pay federal, state, and local taxes.  Back in 1900, “Tax Freedom Day” came on January 22nd.

10 – When the U.S. government first implemented a personal income tax back in 1913, the vast majority of the population paid a rate of just 1 percent, and the highest marginal tax rate was just 7 percent.

11 – Residents of New Jersey pay $1.64 in taxes for every $1.00 of federal spending that they get back.

12 – The United States is the only nation on the planet that tries to tax citizens on what they earn in foreign countries.

13 – According to Forbes, the 400 highest earning Americans pay an average federal income tax rate of just 18 percent.

14 – Warren Buffett had an effective tax rate of just 17.4 percent for 2010.

15 – The top 20 percent of all income earners in the United States pay approximately 86 percent of all federal income taxes.

16 – Sadly, as Bill Whittle has shown, you could take every single penny that every American earns above $250,000 and it would only fund about 38 percent of the federal budget.

Please share this article with as many people as you can.  We have now entered a time of the year when tens of millions of Americans will be filling out their tax returns, and the pain of going through that process will make people even more receptive than normal to the truth about how broken our system is.

So what do you think?

Do you think that it is fair for the ultra-wealthy and hugely profitable corporations to get away with paying zero taxes while you get hammered?

Do you believe that it is time to abolish the income tax?

Please feel free to post a comment with your thoughts below…

No Federal Income Tax

Who Runs The World? Solid Proof That A Core Group Of Wealthy Elitists Is Pulling The Strings

Who Runs The World? Solid Proof That A Core Group Of Wealthy Elitists Are Pulling The StringsDoes a shadowy group of obscenely wealthy elitists control the world?  Do men and women with enormous amounts of money really run the world from behind the scenes?  The answer might surprise you.  Most of us tend to think of money as a convenient way to conduct transactions, but the truth is that it also represents power and control.  And today we live in a neo-fuedalist system in which the super rich pull all the strings.  When I am talking about the ultra-wealthy, I am not just talking about people that have a few million dollars.  As you will see later in this article, the ultra-wealthy have enough money sitting in offshore banks to buy all of the goods and services produced in the United States during the course of an entire year and still be able to pay off the entire U.S. national debt.  That is an amount of money so large that it is almost incomprehensible.  Under this ne0-feudalist system, all the rest of us are debt slaves, including our own governments.  Just look around – everyone is drowning in debt, and all of that debt is making the ultra-wealthy even wealthier.  But the ultra-wealthy don’t just sit on all of that wealth.  They use some of it to dominate the affairs of the nations.  The ultra-wealthy own virtually every major bank and every major corporation on the planet.  They use a vast network of secret societies, think tanks and charitable organizations to advance their agendas and to keep their members in line.  They control how we view the world through their ownership of the media and their dominance over our education system.  They fund the campaigns of most of our politicians and they exert a tremendous amount of influence over international organizations such as the United Nations, the IMF, the World Bank and the WTO.  When you step back and take a look at the big picture, there is little doubt about who runs the world.  It is just that most people don’t want to admit the truth.

The ultra-wealthy don’t run down and put their money in the local bank like you and I do.  Instead, they tend to stash their assets in places where they won’t be taxed such as the Cayman Islands.  According to a report that was released last summer, the global elite have up to 32 TRILLION dollars stashed in offshore banks around the globe.

U.S. GDP for 2011 was about 15 trillion dollars, and the U.S. national debt is sitting at about 16 trillion dollars, so you could add them both together and you still wouldn’t hit 32 trillion dollars.

And of course that does not even count the money that is stashed in other locations that the study did not account for, and it does not count all of the wealth that the global elite have in hard assets such as real estate, precious metals, art, yachts, etc.

The global elite have really hoarded an incredible amount of wealth in these troubled times.  The following is from an article on the Huffington Post website…

Rich individuals and their families have as much as $32 trillion of hidden financial assets in offshore tax havens, representing up to $280 billion in lost income tax revenues, according to research published on Sunday.

The study estimating the extent of global private financial wealth held in offshore accounts – excluding non-financial assets such as real estate, gold, yachts and racehorses – puts the sum at between $21 and $32 trillion.

The research was carried out for pressure group Tax Justice Network, which campaigns against tax havens, by James Henry, former chief economist at consultants McKinsey & Co.

He used data from the World Bank, International Monetary Fund, United Nations and central banks.

But as I mentioned previously, the global elite just don’t have a lot of money.  They also basically own just about every major bank and every major corporation on the entire planet.

According to an outstanding NewScientist article, a study of more than 40,000 transnational corporations conducted by the Swiss Federal Institute of Technology in Zurich discovered that a very small core group of huge banks and giant predator corporations dominate the entire global economic system…

An analysis of the relationships between 43,000 transnational corporations has identified a relatively small group of companies, mainly banks, with disproportionate power over the global economy.

The researchers found that this core group consists of just 147 very tightly knit companies…

When the team further untangled the web of ownership, it found much of it tracked back to a “super-entity” of 147 even more tightly knit companies – all of their ownership was held by other members of the super-entity – that controlled 40 per cent of the total wealth in the network. “In effect, less than 1 per cent of the companies were able to control 40 per cent of the entire network,” says Glattfelder. Most were financial institutions. The top 20 included Barclays Bank, JPMorgan Chase & Co, and The Goldman Sachs Group.

The following are the top 25 banks and corporations at the heart of this “super-entity”.  You will recognize many of the names on the list…

1. Barclays plc
2. Capital Group Companies Inc
3. FMR Corporation
4. AXA
5. State Street Corporation
6. JP Morgan Chase & Co
7. Legal & General Group plc
8. Vanguard Group Inc
9. UBS AG
10. Merrill Lynch & Co Inc
11. Wellington Management Co LLP
12. Deutsche Bank AG
13. Franklin Resources Inc
14. Credit Suisse Group
15. Walton Enterprises LLC
16. Bank of New York Mellon Corp
17. Natixis
18. Goldman Sachs Group Inc
19. T Rowe Price Group Inc
20. Legg Mason Inc
21. Morgan Stanley
22. Mitsubishi UFJ Financial Group Inc
23. Northern Trust Corporation
24. Société Générale
25. Bank of America Corporation

The ultra-wealthy elite often hide behind layers and layers of ownership, but the truth is that thanks to interlocking corporate relationships, the elite basically control almost every Fortune 500 corporation.

The amount of power and control that this gives them is hard to describe.

Unfortunately, this same group of people have been running things for a very long time.  For example, New York City Mayor John F. Hylan said the following during a speech all the way back in 1922…

The real menace of our Republic is the invisible government, which like a giant octopus sprawls its slimy legs over our cities, states and nation. To depart from mere generalizations, let me say that at the head of this octopus are the Rockefeller-Standard Oil interests and a small group of powerful banking houses generally referred to as the international bankers. The little coterie of powerful international bankers virtually run the United States government for their own selfish purposes.

They practically control both parties, write political platforms, make catspaws of party leaders, use the leading men of private organizations, and resort to every device to place in nomination for high public office only such candidates as will be amenable to the dictates of corrupt big business.

These international bankers and Rockefeller-Standard Oil interests control the majority of the newspapers and magazines in this country. They use the columns of these papers to club into submission or drive out of office public officials who refuse to do the bidding of the powerful corrupt cliques which compose the invisible government. It operates under cover of a self-created screen [and] seizes our executive officers, legislative bodies, schools, courts, newspapers and every agency created for the public protection.

These international bankers created the central banks of the world (including the Federal Reserve), and they use those central banks to get the governments of the world ensnared in endless cycles of debt from which there is no escape.  Government debt is a way to “legitimately” take money from all of us, transfer it to the government, and then transfer it into the pockets of the ultra-wealthy.

Today, Barack Obama and almost all members of Congress absolutely refuse to criticize the Fed, but in the past there have been some brave members of Congress that have been willing to take a stand.  For example, the following quote is from a speech that Congressman Louis T. McFadden delivered to the U.S. House of Representatives on June 10, 1932…

Mr. Chairman, we have in this country one of the most corrupt institutions the world has ever known. I refer to the Federal Reserve Board and the Federal Reserve Banks. The Federal Reserve Board, a Government board, has cheated the Government of the United States and the people of the United States out of enough money to pay the national debt. The depredations and iniquities of the Federal Reserve Board has cost this country enough money to pay the national debt several times over. This evil institution has impoverished and ruined the people of the United States, has bankrupted itself, and has practically bankrupted our Government. It has done this through the defects of the law under which it operates, through the maladministration of that law by the Federal Reserve Board, and through the corrupt practices of the moneyed vultures who control it.

Sadly, most Americans still believe that the Federal Reserve is a “federal agency”, but that is simply not correct.  The following comes from factcheck.org…

The stockholders in the 12 regional Federal Reserve Banks are the privately owned banks that fall under the Federal Reserve System. These include all national banks (chartered by the federal government) and those state-chartered banks that wish to join and meet certain requirements. About 38 percent of the nation’s more than 8,000 banks are members of the system, and thus own the Fed banks.

According to researchers that have looked into the ownership of the big Wall Street banks that dominate the Fed, the same names keep coming up over and over: the Rockefellers, the Rothschilds, the Warburgs, the Lazards, the Schiffs and the royal families of Europe.

But ultra-wealthy international bankers have not just done this kind of thing in the United States.  Their goal was to create a global financial system that they would dominate and control.  Just check out what Georgetown University history professor Carroll Quigley once wrote…

[T]he powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent private meetings and conferences. The apex of the system was to be the Bank for International Settlements in Basle, Switzerland, a private bank owned and controlled by the world’s central banks which were themselves private corporations.

Sadly, most Americans have never even heard of the Bank for International Settlements, but it is at the very heart of the global financial system.  The following is from Wikipedia…

As an organization of central banks, the BIS seeks to make monetary policy more predictable and transparent among its 58 member central banks. While monetary policy is determined by each sovereign nation, it is subject to central and private banking scrutiny and potentially to speculation that affects foreign exchange rates and especially the fate of export economies. Failures to keep monetary policy in line with reality and make monetary reforms in time, preferably as a simultaneous policy among all 58 member banks and also involving the International Monetary Fund, have historically led to losses in the billions as banks try to maintain a policy using open market methods that have proven to be based on unrealistic assumptions.

The ultra-wealthy have also played a major role in establishing other important international institutions such as the United Nations, the IMF, the World Bank and the WTO.  In fact, the land for the United Nations headquarters in New York City was purchased and donated by John D. Rockefeller.

The international bankers are “internationalists” and they are very proud of that fact.

The elite also dominate the education system in the United States.  Over the years, the Rockefeller Foundation and other elitist organizations have poured massive amounts of money into Ivy League schools.  Today, Ivy League schools are considered to be the standard against which all other colleges and universities in America are measured, and the last four U.S. presidents were educated at Ivy League schools.

The elite also exert a tremendous amount of influence through various secret societies (Skull and Bones, the Freemasons, etc.), through some very powerful think tanks and social clubs (the Council on Foreign Relations, the Trilateral Commission, the Bilderberg Group, the Bohemian Grove, Chatham House, etc.), and through a vast network of charities and non-governmental organizations (the Rockefeller Foundation, the Ford Foundation, the World Wildlife Fund, etc.).

But for a moment, I want to focus on the power the elite have over the media.  In a previous article, I detailed how just six monolithic corporate giants control most of what we watch, hear and read every single day.  These giant corporations own television networks, cable channels, movie studios, newspapers, magazines, publishing houses, music labels and even many of our favorite websites.

Considering the fact that the average American watches 153 hours of television a month, the influence of these six giant corporations should not be underestimated.  The following are just some of the media companies that these corporate giants own…

Time Warner

Home Box Office (HBO)
Time Inc.
Turner Broadcasting System, Inc.
Warner Bros. Entertainment Inc.
CW Network (partial ownership)
TMZ
New Line Cinema
Time Warner Cable
Cinemax
Cartoon Network
TBS
TNT
America Online
MapQuest
Moviefone
Castle Rock
Sports Illustrated
Fortune
Marie Claire
People Magazine

Walt Disney

ABC Television Network
Disney Publishing
ESPN Inc.
Disney Channel
SOAPnet
A&E
Lifetime
Buena Vista Home Entertainment
Buena Vista Theatrical Productions
Buena Vista Records
Disney Records
Hollywood Records
Miramax Films
Touchstone Pictures
Walt Disney Pictures
Pixar Animation Studios
Buena Vista Games
Hyperion Books

Viacom

Paramount Pictures
Paramount Home Entertainment
Black Entertainment Television (BET)
Comedy Central
Country Music Television (CMT)
Logo
MTV
MTV Canada
MTV2
Nick Magazine
Nick at Nite
Nick Jr.
Nickelodeon
Noggin
Spike TV
The Movie Channel
TV Land
VH1

News Corporation

Dow Jones & Company, Inc.
Fox Television Stations
The New York Post
Fox Searchlight Pictures
Beliefnet
Fox Business Network
Fox Kids Europe
Fox News Channel
Fox Sports Net
Fox Television Network
FX
My Network TV
MySpace
News Limited News
Phoenix InfoNews Channel
Phoenix Movies Channel
Sky PerfecTV
Speed Channel
STAR TV India
STAR TV Taiwan
STAR World
Times Higher Education Supplement Magazine
Times Literary Supplement Magazine
Times of London
20th Century Fox Home Entertainment
20th Century Fox International
20th Century Fox Studios
20th Century Fox Television
BSkyB
DIRECTV
The Wall Street Journal
Fox Broadcasting Company
Fox Interactive Media
FOXTEL
HarperCollins Publishers
The National Geographic Channel
National Rugby League
News Interactive
News Outdoor
Radio Veronica
ReganBooks
Sky Italia
Sky Radio Denmark
Sky Radio Germany
Sky Radio Netherlands
STAR
Zondervan

CBS Corporation

CBS News
CBS Sports
CBS Television Network
CNET
Showtime
TV.com
CBS Radio Inc. (130 stations)
CBS Consumer Products
CBS Outdoor
CW Network (50% ownership)
Infinity Broadcasting
Simon & Schuster (Pocket Books, Scribner)
Westwood One Radio Network

NBC Universal

Bravo
CNBC
NBC News
MSNBC
NBC Sports
NBC Television Network
Oxygen
SciFi Magazine
Syfy (Sci Fi Channel)
Telemundo
USA Network
Weather Channel
Focus Features
NBC Universal Television Distribution
NBC Universal Television Studio
Paxson Communications (partial ownership)
Trio
Universal Parks & Resorts
Universal Pictures
Universal Studio Home Video

And of course the elite own most of our politicians as well.  The following is a quote from journalist Lewis Lapham…

“The shaping of the will of Congress and the choosing of the American president has become a privilege reserved to the country’s equestrian classes, a.k.a. the 20% of the population that holds 93% of the wealth, the happy few who run the corporations and the banks, own and operate the news and entertainment media, compose the laws and govern the universities, control the philanthropic foundations, the policy institutes, the casinos, and the sports arenas.”

Have you ever wondered why things never seem to change in Washington D.C. no matter who we vote for?

Well, it is because both parties are owned by the establishment.

It would be nice to think that the American people are in control of who runs things in the U.S., but that is not how it works in the real world.

In the real world, the politician that raises more money wins more than 80 percent of the time in national races.

Our politicians are not stupid – they are going to be very good to the people that can give them the giant piles of money that they need for their campaigns.  And the people that can do that are the ultra-wealthy and the giant corporations that the ultra-wealthy control.

Are you starting to get the picture?

There is a reason why the ultra-wealthy are referred to as “the establishment”.  They have set up a system that greatly benefits them and that allows them to pull the strings.

So who runs the world?

They do.  In fact, they even admit as much.

David Rockefeller wrote the following in his 2003 book entitled “Memoirs”…

“For more than a century, ideological extremists at either end of the political spectrum have seized upon well-publicized incidents such as my encounter with Castro to attack the Rockefeller family for the inordinate influence they claim we wield over American political and economic institutions. Some even believe we are part of a secret cabal working against the best interests of the United States, characterizing my family and me as ‘internationalists’ and of conspiring with others around the world to build a more integrated global political and economic structure — one world, if you will. If that is the charge, I stand guilty, and I am proud of it.”

There is so much more that could be said about all of this.  In fact, an entire library of books could be written about the power and the influence of the ultra-wealthy international bankers that run the world.

But hopefully this is enough to at least get some conversations started.

So what do you think about all of this?  Please feel free to post a comment with your thoughts below…

The Great Seal Of The United States

The U.S. Has An Even Larger Gap Between The Rich And The Poor Than Downton Abbey Does

The U.S. Has An Even Larger Gap Between The Rich And The Poor Than Downton Abbey DoesThere are two very different Americas today.  In one, the stock market is soaring, high end homes are selling briskly, big banks and hedge funds are rolling in money as if the last financial crisis never even happened, and life is really, really good.  In the other America, good jobs are incredibly scarce, incomes are declining, and poverty is skyrocketing to levels that we have never seen before.  The gap between the wealthy and the poor in America is getting wider with each passing day.  In fact, it is my contention that the U.S. has an even larger gap between the rich and the poor than Downton Abbey does.  If you have never seen Downton Abbey, you really should.  It is one of the most extraordinary shows to appear on television in years.  It is a drama set in the UK which follows the lives of the aristocratic Crawley family and their servants throughout the early part of the 20th Century.  It can be a bit jarring to watch servants wait on their masters hand and foot and refer to them by such titles as “Lord” and “Lady”, but the truth is that in many ways there is more inequality today than there was back then.  As far as people living in the worst areas of cities such as Detroit and Cleveland are concerned, the socialites that live on Fifth Avenue in New York City or in multi-million dollar homes out in the Hamptons might as well be from another planet.  If you have lots of money, America is still a really great place to live.  If you barely have any money, America can be really cold and cruel.  Sadly, our politicians continue to pursue policies that make things even better for those working for the establishment in places such as Washington D.C. and Manhattan, and worse for all the rest of us.  This has especially been true over the course of the past four years.  If nothing is done, the gaping chasm between the rich and the poor will continue to get even worse, and in the end that will have some really severe consequences for our society.

So is the answer to raise taxes and “redistribute” more money to the poor?  Of course not.  Today, we are already paying dozens of different kinds of taxes every year and the government is handing out more money to people than ever before.  But poverty just continues to explode.

What the poor in the U.S. desperately need are good jobs, but we continue to ship millions of good jobs out of the country and Barack Obama continues to pursue policies that are killing the U.S. economy.

There is not much help on the horizon for the poor or the middle class in America, and that should be distressing for all of us.

But things in the wealthy parts of America are going absolutely wonderfully right now.  Let’s take a few moments and contrast what life is like in the two Americas right now…

In the “good America”, stocks are absolutely soaring.  In fact, the S&P 500 closed above 1,500 on Friday for the very first time in more than five years.

In the “bad America”, poverty statistics just continue to get worse.  According to a newly released report, 60 percent of all children in the city of Detroit are living in poverty.

In the “good America”, hedge funds are rolling in the profits.  The Dow just had its best January since January of 1994, and many analysts are projecting that 2013 will be a banner year for the markets.

In the “bad America”, median household income has fallen for four years in a row, and millions of families are really struggling to find a way to pay the bills each month.

In the “good America”, expensive homes are selling at a pace that we have not seen in years.  Just check out what is happening in the Hamptons.  According to the National Association of Realtors, sales of homes worth at least a million dollars were 51 percent higher in November 2012 than they were in November 2011.

In the “bad America”, there are hordes of young adults that cannot find jobs and cannot take care of themselves.  Shockingly, U.S. families that have a head of household that is under the age of 30 have a poverty rate of 37 percent.

In the “good America”, the “too big to fail” banks are partying like it was 2005 again.  For example, revenues at Goldman Sachs increased by about 30 percent in 2012 and Goldman stock has soared by more than 40 percent over the past 12 months.

In the “bad America”, poverty is exploding and government dependence has become a way of life.  If you can believe it, the number of Americans on food stamps has grown from about 17 million in the year 2000 to more than 47 million today.

In the “good America”, those working for the establishment will do just about anything to make a buck.  For instance, Goldman Sachs made 400 million dollars driving up food prices in 2012 while hundreds of millions around the world existed on the edge of starvation.

In the “bad America”, millions of families are wondering how they will make it until next month.  If you can believe it, more than a million public school students in the United States are homeless.  This is the first time that has ever happened in our history.

In the “good America”, everyone has a good ride.  In fact, sales of luxury German-made vehicles set new all-time records in 2012.

In the “bad America”, those that have lost everything are shunned and ostracized.  In fact, many communities all over America are actually making feeding the homeless illegal.

The fact that there is poverty in America should not alarm you.  Every country in the world has poverty.  What should alarm you is how rapidly it is growing.  Even though the Obama administration tells us that we are in an “economic recovery”, things just continue to get worse.  The wealthy elitists in Washington D.C. and New York City may be doing wonderfully, but the truth is that the middle class continues to shrink and just about every poverty statistic that you can think of continues to rise.

If you are convinced that we do not have a “wealth gap” problem in the United States today, just check out the following statistics.  Most of them are from one of my previous articles entitled “The Middle Class In America Is Being Wiped Out – Here Are 60 Facts That Prove It“…

-According to the Economic Policy Institute, the wealthiest one percent of all Americans households on average have 288 times the amount of wealth that the average middle class American family does.

-In the United States today, the wealthiest one percent of all Americans have a greater net worth than the bottom 90 percent combined.

-According to Forbes, the 400 wealthiest Americans have more wealth than the bottom 150 million Americans combined.

-The six heirs of Wal-Mart founder Sam Walton have as much wealth as the bottom one-third of all Americans combined.

-At this point, the poorest 50 percent of all Americans collectively own just 2.5% of all the wealth in the United States.

-The United States now ranks 93rd in the world in income inequality.

-The average CEO now makes approximately 350 times as much as the average American worker makes.

-Today, corporate profits as a percentage of U.S. GDP are at an all-time high, but wages as a percentage of U.S. GDP are near an all-time low.

Sometimes, when the “good America” and the “bad America” collide, the results are quite humorous.

For example, a 23-year-old homeless Brazilian man and his friends recently decided to “move in” to a 7,522 square foot house down in Florida that is valued at $2.1 million.  The following is from a recent article in the Orlando Sentinel…

Bank of America has filed to evict nine squatters from a $2.5-million mansion in a posh Boca Raton neighborhood.

In a filing in Palm Beach County court that names 23-year-old Andre De Palma Barbosa and eight other unknown people, the bank claims rightful ownership of the home – despite Barbosa’s attempt to stake his claim on the foreclosed waterside property by using an obscure Florida real estate law.

Barbosa has been invoking a state law called “adverse possession,” which allows someone to move into a property and claim the title – if they can stay there seven years.

A signed copy of that note is also posted in the home’s front window.

Yeah, they will be able to get him and his friends out of there eventually, but in future years I fear that the conflicts between the rich and the poor will not be so nice.

Already, a very ominous “Robin Hood mentality” is building among the poor in this country.  Many wealthy people don’t even realize that it is happening.  But someday when desperate “flash mobs” are roaming through their neighborhoods looking to do a little “creative redistribution”, then they will get it.

Our society is starting to come apart at the seams, and there is an incredible amount of tension between the rich and the poor.  This is unfortunate, but instead of calming things down many of our politicians are actually exploiting this tension.

When our economy crashes, the class warfare of today may actually turn into real war in the streets.  Desperate people do desperate things, and when people are hungry and they can’t feed their families, many of them will not be afraid to go over to the wealthy neighborhoods and take what they want.

A lot of people don’t want to see them, but dark clouds are building.  According to a recent Gallup poll, Americans are more negative about where America will be five years from now than they have ever been before.  Most people know that we are on the edge of something really bad, even if they can’t really explain it.

It is time to get ready for what is coming.  Even though the stock market is soaring right now, that could change at any moment.  All of the long-term economic and societal trends are pointing to some really bad things in the years ahead, and sticking our heads in the sand and pretending that everything is going to be okay somehow is not going to help.

So what do you think about all of this?

Do you think that the U.S. has an even larger gap between the rich and the poor than Downton Abbey does?

Please feel free to post a comment with your thoughts below…

Downton Abbey

Will The Wealthy Race To Dump Stocks And Other Financial Assets Before The Fiscal Cliff Kicks In?

The election results made it abundantly clear that taxes are going to be going up, and right now a lot of wealthy people all over America are trying to figure out how to best position themselves for the hit that is coming.  There are a whole host of tax cuts that are set to expire on December 31st, and many analysts are now speculating that we could see a race to dump stocks and other financial assets before 2013 in order to get better tax treatment on those sales.  Of course it is still possible that Congress may reach a bargain which would avoid these tax increases, but with each passing day that appears to be increasingly unlikely – especially regarding the tax increases on the wealthy.  Whatever you may believe about this politically, the truth is that we should all be able to agree that these looming tax increases provide an incentive for wealthy people to sell off financial assets now rather than later.  After all, there are very few people out there that would actually prefer to pay higher taxes on purpose.  If the race to dump financial assets becomes a landslide, could this push stocks down significantly late in the year?  Already there are all sorts of technical signs that indicate that stocks are ready for a “correction” at the very least.  For example, the S&P 500 has already closed below its 200 day moving average for several days in a row.  Could the “sell off” that has already begun become a race for the exits?

A lot of Americans have heard about the looming “fiscal cliff”, but most don’t really understand the specifics.

For investors, there are several key changes which will happen unless Congress does something by January 1st.

First of all, the tax rate on capital gains will go from 15 percent to 20 percent.  For those with high incomes, the rate will be even higher than that thanks to a tax increase that our politicians managed to sneak into Obamacare.  So, some wealthy individuals will see their capitals gains taxed at nearly 24 percent in 2013 unless something is done.

For dividends, the outlook is even more frightening.  The tax rate on dividends will increase from 15 percent right now to over 43 percent for the highest income earners.

We have already seen these tax increases play into business decisions that have been made in recent months.  For example, it is being reported that George Lucas potentially saved hundreds of millions of dollars in taxes by selling Star Wars to Disney this year rather than next year.

Anyone out there that wants to take advantage of the current tax rates on capital gains and dividend income better do so now, because these tax rates look like they are going to go away and they probably will not be back for a very, very long time.

According to CNBC, this makes the next couple of months an ideal time to dump stocks and other financial assets…

For many of the wealthy, 2012 is becoming a good year to sell.

They’re worried about the “fiscal cliff,” which is when tax cuts expire and spending cuts are set to go into effect at the end of the year.

Fearing an increase in capital gains and dividend taxes, many of the rich are unloading stocks, businesses and homes before the end of the year.

And the truth is that stocks simply did not have much higher that they could possibly go anyway.  Anyone that is trying to “get out while the getting is good” should take heed of what Marc Faber recently told CNBC…

“The market is going down because corporate profits will begin to disappoint, the global economy will hardly grow next year or even contract, and that is the reason why stocks, from the highs of September of 1,470 on the S&P, will drop at least 20 percent, in my view.”

In fact, Faber is absolutely convinced that a full-blown stock market crash is coming no matter what happens with the fiscal cliff…

“I think the whole global financial system will have to be reset and it won’t be reset by central bankers but by imploding markets — either the currency [markets, debt market or stock markets,” he said. “It will happen — it will happen one day and then we’ll be lucky if we still have 50 percent of the asset values that we have today.”

Politics and economics have always been deeply intertwined.  The results of the most recent election are going to have some very deep consequences.  Already we have seen a large number of businesses either announce layoffs or that hours for their workers will be cut back.  You can find a bunch of tweets from small business owners talking about how they won’t be hiring anyone or that they will be forced to reduce hours right here.  You can find a bunch of tweets from average citizens all over the country talking about how their hours are already being cut back right here.

With each passing day, our country is getting poorer, it is getting even deeper in debt and our economy is becoming even more unstable.  We are on a path that will only lead to total economic disaster, but the American people just voted for more of the same.

So now we will get to see how this all plays out.

Is there anyone out there that is still optimistic about what is coming next for the U.S. economy?

Quantitative Easing Did Not Work For The Weimar Republic Either

Did printing vast quantities of money work for the Weimar Republic?  Nope.  And it won’t work for us either.  If printing money was the secret to economic success, we could just print up a trillion dollars for every American and be done with it.  The truth is that making everyone in America a trillionaire would not mean that we would all suddenly be wealthy.  There would be the same amount of “real wealth” in our economy as before.  But what it would do is render our currency meaningless and totally destroy faith in our financial system.  Sadly, we have not learned the lessons that history has tried to teach us.  Back in April 1919, it took 12 German marks to get 1 U.S. dollar.  By December 1923, it took approximately 4 trillion German marks to get 1 U.S. dollar.  So was the Weimar Republic better off after all of the “quantitative easing” that they did or worse off?  Of course they were worse off.  They destroyed their currency and wrecked all confidence in their financial system.  There was an old joke that if you left a wheelbarrow full of money sitting around in the Weimar Republic that thieves would take the wheelbarrow and they would leave the money behind.  Will things eventually get that bad in the United States someday?

Of course we are not going to see hyperinflation in the U.S. this week or this month.

But don’t think that it will never happen.

The people of Germany never thought that it would happen to them, but it did.

The following is an excerpt from a Wikipedia article about the Weimar Republic.  Take note of the similarities between what the Weimar Republic experienced and what we are going through today….

The cause of the immense acceleration of prices that occurred during the German hyperinflation of 1922–23 seemed unclear and unpredictable to those who lived through it, but in retrospect was relatively simple. The Treaty of Versailles imposed a huge debt on Germany that could be paid only in gold or foreign currency. With its gold depleted, the German government attempted to buy foreign currency with German currency, but this caused the German Mark to fall rapidly in value, which greatly increased the number of Marks needed to buy more foreign currency. This caused German prices of goods to rise rapidly which increase the cost of operating the German government which could not be financed by raising taxes. The resulting budget deficit increased rapidly and was financed by the central bank creating more money. When the German people realized that their money was rapidly losing value, they tried to spend it quickly. This increase in monetary velocity caused still more rapid increase in prices which created a vicious cycle. This placed the government and banks between two unacceptable alternatives: if they stopped the inflation this would cause immediate bankruptcies, unemployment, strikes, hunger, violence, collapse of civil order, insurrection, and revolution. If they continued the inflation they would default on their foreign debt. The attempts to avoid both unemployment and insolvency ultimately failed when Germany had both.

When the Weimar Republic first started rapidly printing money everything seemed fine at first.  Economic activity was buzzing and unemployment was very low.

But as the following chart shows, when hyperinflation kicks in, it can happen very quickly.  By late 1922, the effects of all of the money printing were really starting to hit the German economy….

Once you start printing money it is really, really hard to stop.

By late 1922, inflation was officially out of control.  An article in The Economist described what happened next….

Prices roared up. So did unemployment, modest as 1923 began. As October ended, 19% of metal-workers were officially out of work, and half of those left were on short time. Feeble attempts had been made to stabilise prices. Some German states had issued their own would-be stable currency: Baden’s was secured on the revenue of state forests, Hanover’s convertible into a given quantity of rye. The central authorities issued what became known as “gold loan” notes, payable in 1935. Then, on November 15th, came the Rentenmark, worth 1,000 billion paper marks, or just under 24 American cents, like the gold mark of 1914.

Hyperinflation hurts the poor, the elderly and those on fixed incomes the worst.  The following is an excerpt from a work by Adam Fergusson….

The rentier classes who depended on savings or pensions, and anyone on a fixed income, were soon in penury, their possessions sold. Barter often took over from purchase. By law rents could not be raised, which allowed employers to pay low wages and impoverished landlords in a country where renting was the norm. The professional classes — lawyers, doctors, scientists, professors — found little demand for their services. In due course, the trade unions, no longer able to strike for higher wages (often uncertain what to ask for, so fast became the mark’s fall from day to day), went to the wall, too.

Workers regularly got wage increases during this time, but they never seemed to keep up with the horrible inflation that was raging all around them.  So they steadily became poorer even though the amount of money they were bringing home was steadily increasing.

People started to lose all faith in the currency and in the financial system.  This had an absolutely devastating effect on the German population.  American author Pearl Buck was living in Germany at the time and the following is what she wrote about what she saw….

“The cities were still there, the houses not yet bombed and in ruins, but the victims were millions of people. They had lost their fortunes, their savings; they were dazed and inflation-shocked and did not understand how it had happened to them and who the foe was who had defeated them. Yet they had lost their self-assurance, their feeling that they themselves could be the masters of their own lives if only they worked hard enough; and lost, too, were the old values of morals, of ethics, of decency.”

Of course not everyone in Germany was opposed to the rampant inflation that was happening.  There were some business people that became very wealthy during this time.  The hyperinflation rendered their past debts meaningless, and by investing paper money (that would soon be worthless) into assets that would greatly appreciate thanks to inflation, many of them made out like bandits.

The key was to take your paper money and spend it on something that would hold value (or even increase in value) as rapidly as possible.

The introduction of the Rentenmark brought an end to hyperinflation, but the damage to the stability of the German economy had been done.  The German economy went through several wild swings which ultimately resulted in the rise of the Nazis.  The following description of this time period is from an article by Alex Kurtagic….

The post-hyperinflationary credit crunch was, not surprisingly followed by a credit boom: starved of money and basic necessities for so long (do not forget the hyperinflation had come directly after defeat in The Great War), many funded lavish lifestyles through borrowing during the second half of the 1920s. We know how that ended, of course: in The Great Depression, which eventually saw the end of the Weimar Republic and the beginning of the National Socialist era.

By the end of the decade unemployment really started to take hold in Germany as the following statistics reveal….

September 1928 – 650,000 unemployed

September 1929 – 1,320,000 unemployed

September 1930 – 3,000,000 unemployed

September 1931 – 4,350,000 unemployed

September 1932 – 5,102,000 unemployed

January 1933 – 6,100,000 unemployed

By the end of 1932, over 30 percent of all German workers were unemployed.  This created an environment where people were hungry for “change”.

On January 30th, 1933 Hitler was sworn in as chancellor, and the rest is history.

So where will all of this money printing take America?

As I wrote about in a previous article, the amount of excess reserves that banks have stashed with the Federal Reserve has risen from about 9 billion dollars on September 10th, 2008 to about 1.5 trillion dollars today….

What is going to happen to inflation when all of those excess reserves start flowing out into the regular economy?

It won’t be pretty.

Just consider the ominous words that Philadelphia Fed President Charles Plosser used earlier this week….

“Inflation is going to occur when excess reserves of this huge balance sheet begin to flow outside into the real economy.  I can’t tell you when that’s going to happen.”

“When that does begin if we don’t engage in a fairly aggressive and effective policy of preventing that from happening, there’s no question in my mind that that will lead to lots of inflation.”

Oh great.

And so what is Bernanke doing?

He is printing up lots more money.

But isn’t this supposed to help the economy?

I wouldn’t count on it.

According to USA Today, the following is what Plosser says about the effect that QE3 is likely to have on our economy….

“We are unlikely to see much benefit to growth or to employment from further asset purchases.”

But we will get more inflation, so our monthly budgets will not go as far as they did before.

The other day I was going to the supermarket, and my wife told me that she wanted some croissants.  When I got to the bakery section I discovered that it was $4.49 for just four croissants.

If it had just been for me, I would have never gotten them.  I am the kind of shopper that doesn’t even want to look at something unless there is a sale tag on it.

But I did get the croissants for my wife.

Unfortunately, thanks to Federal Reserve Chairman Ben Bernanke soon none of us may be able to afford to buy croissants.

I still remember the days when I could fill up my entire shopping cart for 20 bucks.

And it was not that long ago – I am talking about the late 90s.

But paying more for food is not the greatest danger we are facing.  Bernanke is destroying the credibility of our currency and he is destroying faith in our financial system.

Bernanke may believe that he is preventing the next great collapse from happening, but the truth is that what he is doing is going to make the eventual collapse far worse.

Better get your wheelbarrows ready.

How QE3 Will Make The Wealthy Even Wealthier While Causing Living Standards To Fall For The Rest Of Us

The mainstream media is hailing QE3 as a great victory for the U.S. economy.  On nearly every news broadcast, the “talking heads” are declaring that Ben Bernanke’s decision to pump 40 billion dollars a month into our financial system is definitely going to help solve our economic problems.  The money for QE3 is being created out of thin air and this round of quantitative easing is going to be “open-ended” which means that the Federal Reserve is going to keep doing it for as long as they feel like it.  But is this really good for the average American on the street?  No way.  Despite two previous rounds of quantitative easing, median household income has still fallen for four years in a row, the employment rate has not bounced back since the end of the last recession, and new home sales have remained near record lows.  So what have the previous rounds of quantitative easing accomplished?  Well, they have driven up the prices of financial assets.  Those that own stocks have done very well the past couple of years.  So who owns stocks?  The wealthy do.  In fact, 82 percent of all individually held stocks are owned by the wealthiest 5 percent of all Americans.  Those that have invested in commodities have also done very nicely in recent years.  We have seen gold, silver, oil and agricultural commodities all do very well.  But that also means that average Americans are paying more for basic necessities such as food and gasoline.  So the first two rounds of quantitative easing made the wealthy even wealthier while causing living standards to fall for all the rest of us.  Is there any reason to believe that QE3 will be any different?

Of course not.

This time the Federal Reserve is focused on buying mortgage-backed securities.  Yes, the same financial garbage that helped cause the last crisis.  The Fed plans to gobble up tens of billions of dollars of that trash every month from now on.

But will the Fed pay true market value for those mortgage-backed securities?  If you believe that, I have a bridge to sell you.

So this is going to be a huge windfall for some people, and that does not include us.

Not a single penny of this 40 billion dollars a month will go directly into our hands.  The theory is that it will “filter down” to us eventually.

But that hasn’t happened with previous rounds of quantitative easing.

So where does the money go?

A recent CNBC article discussed a very interesting report from the Bank of England about the effects of quantitative easing….

It said that the Bank of England’s policies of quantitative easing – similar to the Fed’s – had benefited mainly the wealthy.

Specifically, it said that its QE program had boosted the value of stocks and bonds by 26 percent, or about $970 billion. It said that about 40 percent of those gains went to the richest 5 percent of British households.

Many said the BOE’s easing added to social anger and unrest. Dhaval Joshi, of BCA Research wrote that  “QE cash ends up overwhelmingly in profits, thereby exacerbating already extreme income inequality and the consequent social tensions that arise from it.”

Wow.

Who benefits from quantitative easing?

According to the Bank of England, it is “mainly the wealthy” who benefit.

As I noted the other day, Donald Trump said essentially the same thing when he told  CNBC the following….

“People like me will benefit from this.”

As I already discussed above, a lot of quantitative easing money gets into the financial markets where it pumps up the prices of financial assets.

But not all of it goes there.

We were told that the whole idea behind quantitative easing was that it was supposed to get banks lending again, but this has not happened.  Instead, banks are sitting on unprecedented amounts of money.  Just look at how the first two rounds of quantitative easing have caused excess reserves being held by banks to explode from close to zero to over 1.5 trillion dollars….

Of course one of the biggest problems is that the Federal Reserve is still paying banks not to lend money.

Yes, you read that correctly.

The Federal Reserve is paying banks to park money with them.  So instead of risking their money by lending it out to us, the banks can just park it at the Fed and make risk-free profits for as long as they want.

Must be nice.

If the Federal Reserve really wanted banks to start lending again, all the Fed has to do is to stop paying banks not to lend money.

But of course if more than 1.5 trillion dollars suddenly started flooding into our economy (especially after you consider the multiplier effect) we would be dealing with nightmarish inflation unlike anything we have ever seen before.

So if you want to know why inflation was not even worse after QE1 and QE2 it is because more than a trillion and a half dollars is being parked with the Fed.

So did QE1 and QE2 do any good for average Americans?

Let’s go to the charts.

This first chart shows that the percentage of working age Americans with a job has stayed extremely flat since the end of the last recession.

Does it look like QE1 and QE2 made a difference to you?  I don’t see any difference….

Okay, but what about new home sales?

Did QE1 and QE2 help them?

Nope….

But the mainstream media is still buying the baloney the Fed is pushing.

The mainstream media is promising us that home sales will soon rise and that lots of new jobs are on the way.

Sadly, the truth is that things have steadily gotten worse for average Americans over the past 4 years despite all of the money printing the Fed has been doing.  If you doubt this, just read this article.

But this is all that Ben Bernanke seems to have left.  When printing money doesn’t work, his answer is to print even more money.

QE3 is likely to cause agricultural commodities and the price of oil to rise even further.

So unless you can convince your employer to give you a corresponding raise, this is going to mean that your paychecks are not going to go as far as they did before.

And so that means a lower standard of living.

In a recent article, Bruce Krasting issued an ominous warning….

Higher inflation expectations in the US will filter around the globe. Post the extraordinary steps Ben took yesterday, people will be stocking up on “stuff”. Things like rice, flour, cooking oil, soy, wheat and sugar. If you can eat it, buy it now. It will be more expensive in a month. While your at it, fill up the gas tank, the price is going up next week and every week for the next few months.

In addition, the policy of the Federal Reserve of keeping interest rates as low as possible is absolutely crippling the finances of many retirees.  Even the former president of the Federal Reserve Bank of Atlanta, William F. Ford, recognizes this….

One of the overlooked consequences of the Federal Reserve’s recent rounds of monetary stimulus is the adverse impact those policies have had on the interest income of savers. The prolonged and abnormally low interest-rate structure put in place by the Fed has made life particularly difficult for retirees and others who depend on conservative interest-sensitive investments. But the negative effects do not stop there. They spillover into the overall performance of the economy.

Just about everything that the Federal Reserve does these days is bad for ordinary Americans.

But the Fed is not going to stop.  The Fed is addicted to money printing now, and as a recent article by Peter Schiff explained, the Fed is just going to “up the dosage” until it gets what it wants….

The Fed will try to conjure a recovery on the backs of currency debasement. It will not stop or alter from this course. If the economy fails to respond to the drugs, Bernanke will simply up the dosage. In fact, he is so convinced we will remain dependent on quantitative easing that he explicitly said he won’t turn off the spigots even if things noticeably improve.

This is complete and total incompetence by Ben Bernanke and his cohorts over at the Fed.

Economist Marc Faber believes that Ben Bernanke should resign, and I agree with him….

“If I had messed up as badly as Bernanke I would for sure resign. The mandate of the Fed to boost asset prices and thereby create wealth is ludicrous — it doesn’t work that way. It’s a temporary boost followed by a crash.”

And yes, a crash is coming.

Bernanke can try to put it off for a while, but every action he takes is just making the eventual crash even worse.

And some in the financial community clearly recognize this.  For example, credit rating agency Egan-Jones downgraded the credit rating of the United States to AA- on Friday.

The primary reason they gave for the downgrade was QE3.

Ben Bernanke and the Federal Reserve are destroying the U.S. dollar and destroying our financial system for a short-term economic sugar high.

It is utter insanity.

That is why we desperately need to get the American people educated about the Federal Reserve system.  It is at the very heart of our economic problems and yet neither major political party is willing to blame the Fed for the problems that it is causing.

A bunch of unelected bankers that are not accountable to the American people are running our economy into the ground and the American people do not even realize what is happening.

Please share this article with as many people as you can.  Hopefully we can get the American people to understand that more money printing is definitely not the solution to our problems.

Forsaken And Forgotten

America is becoming a very cold place.  If you don’t have money, you don’t really matter much in our society.  The ads on television aren’t for you – they are directed at people that actually have good jobs and that can afford to buy the nice little “extras” in life.  The politicians aren’t really interested in you either – they figure that they can buy your vote with all of the money that they are getting from the wealthy people.  When you don’t have money, even friends and relatives start to distance themselves from you.  Perhaps they are afraid that you will ask them for money or perhaps they are afraid that your “failure” will start to rub off on them.  When people know that you are struggling for money, the barriers immediately go up.  In the United States today, there are tens of millions of people that have been forsaken and forgotten.  They mostly stay at home (if they still have a home), and for most of them quiet desperation has become a way of life.  You won’t ever read much about them or see them appear much on television because nobody really cares too much about them.  As far as society is concerned, there are just way too many of them and they are a problem that “the government” should be able to handle anyway.  Sadly, the truth is that many communities all across America want absolutely nothing to do with those that can’t take care of themselves.  All over the country cities are passing laws making it illegal to feed the homeless, and in other instances cities are actually making it illegal to be homeless.  Unfortunately, this problem is not going away.  In fact, the number of Americans living in poverty increases with each passing day.  So where do we go from here?

These days, a lot of formerly middle class Americans are down on their luck and can’t even afford to buy enough food.  The following is from a recent Yahoo article….

Cheryl Preston knows that others are worse off. But she’s still hungry.

As grocery prices creep higher and her income sags, rationing her family’s food is a daily task. The 54-year-old mother of three and grandmother of three in Roanoke, Va., says there are days she skips meals so her husband and son can eat. If they notice, she says, she’ll let them think she’s fasting. She waters down the milk and juice to make it last longer. She visits food pantries, but it’s not enough.

Have you ever had to skip meals because you simply could not afford to buy enough food?

Have you ever wondered how you were going to make it to the next paycheck?

When you look into the eyes of your hungry children and you realize that your best efforts have not been good enough to provide what they need it can be absolutely soul crushing.

And when you have lost everything it quickly becomes apparent that most people in society simply do not care about you.

About a third of the country is already on some form of welfare.  Another family falling out of the middle class and into poverty is not going to cause anyone to sit up and take notice.

The middle class in America is being absolutely shredded.  In a recent article I wrote entitled “84 Statistics That Prove That The Decline Of The Middle Class Is Real And That It Is Getting Worse” I detailed this very clearly.  But most Americans don’t think about this very much because they are just focused on what is going on in their own little worlds.  If they still have their jobs and if their family and friends are still doing okay then they are likely to believe that everything is just fine.

But everything is not fine.

According to the Pew Research Center, 61 percent of all Americans were “middle income” back in 1971.

Today, only 51 percent of all Americans are “middle income”.

There aren’t enough good jobs in this country and there never will be enough good jobs ever again.

Those that are just entering the job market understand very clearly that there are not enough good jobs.

Of the recent college graduates that have been fortunate enough to actually get a job, about half of them have taken jobs that do not even require a college degree.

But at least if you have a job, even if it is really crappy, you still matter in this economy.

Many of those that are not working at all have been completely forsaken and forgotten.

Over the past year, approximately 1.3 million Americans have seen their extended unemployment benefits end.  Most of them are considered to have “dropped out of the labor force” even though they aren’t working, they don’t have any income coming in and they are very desperate.  They are told to go “get a job” in an economy that does not produce enough jobs for everyone.  The music stopped playing and they were left without a seat and nobody really cares too much.

But if you live in the good areas of New York City, Boston, Washington D.C., Los Angeles, San Francisco or Seattle this article might seem like complete nonsense to you.  After all, corporate profits are at an all-time high and the stores and malls where you live are packed with people.  Everyone around you is driving new cars, wearing designer clothes and using the latest tech gadgets.

But it is not like that everywhere in America.

There are two Americas today.  One is swimming in money and is seemingly more prosperous than ever.

The other America is a complete and total economic nightmare.

Just check out the percentage of blighted properties in some of America’s most run down cities….

Baltimore: 14 percent

Cleveland: 19 percent

Youngstown, Ohio: 21 percent

New Orleans: 21 percent

Detroit: 24 percent

Flint, Michigan: 27 percent

But those that are paying millions of dollars for dinky little apartments in New York City may be wondering what all the fuss is about.

Well, in the forgotten areas of America “despair” is what people experience on a good day.  Unemployment and government dependence are a way of life, and alcohol and drugs are used to dull the pain.  The following is from a recent article by Chris Hedges.  It describes what life is like in the little town of Gary, West Virginia….

Joe and I are sitting in the Tug River Health Clinic in Gary with a registered nurse who does not want her name used. The clinic handles federal and state black lung applications. It runs a program for those addicted to prescription pills. It also handles what in the local vernacular is known as “the crazy check” — payments obtained for mental illness from Medicaid or SSI — a vital source of income for those whose five years of welfare payments have run out. Doctors willing to diagnose a patient as mentally ill are important to economic survival.

“They come in and want to be diagnosed as soon as they can for the crazy check,” the nurse says. “They will insist to us they are crazy. They will tell us, ‘I know I’m not right.’ People here are very resigned. They will avoid working by being diagnosed as crazy.”

The reliance on government checks, and a vast array of painkillers and opiates, has turned towns like Gary into modern opium dens. The painkillers OxyContin, fentanyl — 80 times stronger than morphine — Lortab, as well as a wide variety of anti-anxiety medications such as Xanax, are widely abused. Many top off their daily cocktail of painkillers at night with sleeping pills and muscle relaxants. And for fun, addicts, especially the young, hold “pharm parties,” in which they combine their pills in a bowl, scoop out handfuls of medication, swallow them, and wait to feel the result.

There are hundreds of small towns all over America today just like Gary that have been forsaken by society.  Most people in those towns are just “existing” and gave up all hope of a better life long ago.

Some of these stories are being told in a new documentary film called “American Winter”.  You can view the trailer for the film right here.  It is a very powerful 5 minutes and 41 seconds.

Sadly, the truth is that there really does not need to be so much suffering in America.

Did you know that Americans waste 165 billion dollars worth of food each year?

That could sure feed a lot of hungry people.

And the overwhelming greed that we see in society today is absolutely astounding.

For example, Yahoo recently profiled a hoarder who packed her home with $500,000 worth of “stuff” that she could not resist buying….

There are shoe closets, and then there are shoe rooms. Monte, a retired teacher in her fifties, had scattered $20,000 worth of footwear throughout six rooms in her home. Some were organized by color, but most lay in mountainous piles of clutter in her 4,000 square foot home outside Tulsa, Oklahoma.

Over a period of 10 years, she’d spent over $500,000 on clothing, accessories and home furnishings, all of which lay strewn across her kitchen, entryway and bedrooms, tags intact.

But far worse are the “Rich Kids of Instagram“.  It has apparently become trendy for wealthy kids to take pictures of themselves enjoying their outrageous wealth.  It truly is disgusting.

Meanwhile, most American families are really struggling to get by.  In fact, 77 percent of all Americans live paycheck to paycheck at least some of the time.

And jobless claims are rising again.  We are on the verge of another major economic crisis and that means that millions more Americans are going to lose their jobs and their homes.

If you think that things are bad now, just wait, because things are about to get a whole lot worse.

Don’t be afraid to reach out and help those that are hurting.  When things are the darkest, that is when heroes are needed the most.

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