The Treasury Secretary chimes in on what any market watcher should know instinctively. Mnuchin talks tech: ‘I don’t understand these valuations’, yet the price on promises and future expectation of earnings has a large amount of the equity speculators and computerized trading in a crisis of sanity. Avoiding the fundamental relationship that a stock value is based upon the ability of a company to turn a profit, has become the hottest investment hoax since Bernard Madoff was pitching his Ponzi scheme. Uber, Snapchat and Twitter may be high flyers for the smart set, but for rational venture capitalists, plunking down gambles on risky enterprises that only feed on publicity hype is a sure bet on going broke.
While angel funding, seed investment and incubation have a nice ring to their functions, what they all have in common is gaining a piece of the equity action before any IPO is sold to the investment insiders, much less the general public. What is often lost is that any new startup enterprise must develop cash flow well before any earnings can be achieved. Continue reading
American Families Face Increasing Financial Instability
The financial situation of many middle class American households is strikingly unstable, according to a new report from the Harvard Business Review.
The Harvard Business Review finds that there is increasing trend of financial vulnerability for lower and middle class American households. According to the report, households experienced an average of five months per years in which household income increased or decreased by more or less than 25 percent.
Our first big finding was that the households’ incomes were highly unstable, even for those with full-time workers. We counted spikes and dips in earning, defined as months in which a household’s income was either 25% more or 25% less than the average. It turned out that households experienced an average of five months per year with either a spike or dip. In other words, incomes were far from average almost half of the time. Income volatility was more extreme for poorer families, but middle class families felt it too. Continue reading
ADVERTISEMENTS FROM SEEMINGLY independent advocacy groups are swamping Beltway newspapers with dire warning that recent proposals to lower drug prices will lead to dangerous consequences. In the last week alone, the ads have appeared in the Washington Post, Washington Times, Roll Call, The Hill, and Politico.
The groups placing the ads have no obvious connection to pharmaceutical companies. For instance, the American Conservative Union (ACU), one of the organizations taking out an ad, describes itself as devoted to promoting “liberty, personal responsibility, traditional values, and strong national defense.” Continue reading
NOTE: This article was published in 2007 at www.ConservativeTruth.org. Little has changed in the ten years since then as far as the facts that led the United States to its current position. Much has changed in the numbers, however. For instance, during the reign of Barrack Obama, $10 Trillion was added to the National Debt. That is more than the debt added by all the presidents before him combined in over 230 years.
A few years ago, as the stock market experienced wild ups and downs, I watched 5 guest panelists on CNBC express their opinions on the reasons for the volatility. Actually, seven people interrupted and talked over one another in their zeal to get their points across. The two hosts, who were supposed to be interviewing the five panelists, spent most of the time expressing their own opinions. The one common denominator was that all seven continually referred to “The Fed,” wondering how that institution might move to solve the problem. I laughed out loud! These were supposedly sophisticated people, representatives of financial and educational institutions and think tanks. And yet they seemed to be as painfully ignorant of the truth concerning the “The Fed” (more formally known as “The Federal Reserve System”) as the average American on the street.
The simple truth is that The Federal Reserve System is neither federal, nor does it have any reserves. The Fed is a system of private banks, owned by rich foreign and American bankers. It is the biggest scam ever perpetrated upon the American people. It is the reason we have inflation. Continue reading
To understand the impact of inflation on the US dollar, it’s helpful to compare its purchasing power to gold over time. Fifty years ago, the dollar’s value was quite substantial, but over time artificially low interest rates and money printing by the Fed have helped erode the greenback’s potency. In contrast, gold’s unique ability to preserve wealth and purchasing power is easy to see when compared to the dollar over the same time period.
The following infographic shows the difference between two different savings scenarios:
An American stores $3,500 in a safety deposit box in 1967 and takes it out in 2017.
An American stores $3,500 worth of gold (100 oz) in a safety deposit box in 1967 and takes it out in 2017.
If each person then went on a spending spree, here’s what could they buy.
The central struggle since the inception of the Republic has been about the control of money. Since the U.S. Constitution clearly defines coinage, the objective of the mercantile elite was to circumvent the law and establish a National Bank. Woe to any defender of President Andrew Jackson for abolishing the Second Bank of the United States and rendering the Bankster Nicholas Biddle to his ignominious place in hell. This victory for the common man was ultimately betrayed when the Federal Reserve Central Bank was instituted with all the ills of fractional reserve banking.
Since this treachery, the country was placed completely under the bondage yoke of debt created money. In the age of J.P. Morgan, the Jackals of Jekyll Island were able to implement the Rothschild scheme of the issuance of money by a private bank with the passage of the 1913 Federal Reserve Act. The inevitable reduction in purchasing value of Federal Reserve Notes and increase in the national debt provided the backdrop to the conditions that resulted in Black Tuesday October 29, 1929. Continue reading
The Fed’s minutes came out today, and they were yet mildly hawkish in that vague sort of way that has preceded twenty-nine of the last two actual rate increases.
There is a theory about that because of the failure of the EU and alternatively China, the inflows of monies into dollar assets are bound to continue to drive the major stock indices higher, and will prompt the Fed to raise rates higher than many think.
This is a variant of the ‘money on the sidelines’ theory that, for whatever reasons, will be compelled to toss their wealth into overpriced assets because they have ‘no other choice.’
Now of course this is possible. The real question is, ‘how probable.’ And what sorts of things might we watch to determine if this particular scenario is genuinely falling into place. Continue reading
When President Trump signed an executive order shortly after taking office designed to weaken the Affordable Care Act, some questioned whether the instructions to federal agencies to look for ways to ease the law’s burden on businesses and individuals would have any real bite.
But on Tuesday, there can be little doubt Trump is succeeding in hastening the demise of a program that currently insures more than 9 million Americans. That’s because the Internal Revenue Service responded by weakening the health care law’s requirement that individuals either acquire health insurance or pay the penalty. Continue reading
Dear Imperial America: the lifestyle you ordered is permanently out of stock.
Our extraordinary misallocation of national treasure and political power has set a banquet of consequences that few are willing to face, much less address head-on. If we had to sum up this vast misallocation, we might start by characterizing it as the result of a multitude of elites playing Empire with money borrowed from future generations.
We can start the list of extraordinary misallocations of national treasure with the Neocon’s endless wars of choice. Ten years ago, estimates of the total cost of the Iraq misadventure were $3 trillion: Cost of Iraq War: $3 Trillion; Cost of Solar Plants to Power all 105 million U.S Households: $500 Billion (April 10, 2008) Continue reading
It’s an unfortunate historical anomaly that people think about the paper in their wallets as money. The dollar is, technically, a currency. A currency is a government substitute for money. But gold is money.
Now, why do I say that?
Historically, many things have been used as money. Cattle have been used as money in many societies, including Roman society. That’s where we get the word “pecuniary” from: the Latin word for a single head of cattle is pecus. Salt has been used as money, also in ancient Rome, and that’s where the word “salary” comes from; the Latin for salt is sal (or salis). The North American Indians used seashells. So, money is simply a medium of exchange and a store of value. Continue reading
The only possible output of low social capital is rising inequality.
One of the themes I’ve been addressing since 2008 is the neocolonial-plantation structure of the U.S. economy. The old models of colonial exploitation that optimized plantations worked by cheap imported labor (or situated in peripheral nations with plenty of cheap labor) have, beneath the surface, been adapted to advanced capitalist democracies.
The adaptations have been so successful that not only do we not even recognize the Plantation structure–we love our servitude within it. Continue reading
Things Are Happening That Usually Never Happen Unless A New Recession Is Beginning
Is the U.S. economy about to get slammed by a major recession? According to Gallup, U.S. economic confidence has soared to the highest level ever recorded, but meanwhile, a whole host of key economic indicators are absolutely screaming that a new recession is beginning. And if the U.S. economy does officially enter recession territory in 2017, it certainly won’t be a shock, because the truth is that we are well overdue for one. Donald Trump has inherited quite an economic mess from Barack Obama, and it was probably inevitable that we were headed for a significant economic downturn no matter who won the election. Continue reading
Americans who unexpectedly find they can’t pay their bills are at a greater risk of dying, according to a new research report from the Federal Reserve Bank of Atlanta. The research also found that a significantly improved credit score can lead to an increase in life expectancy.
The report determined that people’s mortality rates rose by 5 percent when they suddenly fell behind on their debt payments due to a sudden macro event such as a recession. But the risk of death was reduced by more than 4 percent if an individual’s credit score increased by 100 points.
Delinquency had the biggest impact in the short term. Individuals were far more likely to die from an immediate debt shock than from lingering debt. Continue reading
“A private central bank issuing the public currency is a greater menace to the liberties of the people than a standing army. We must not let our rulers load us with perpetual debt.” ~ Thomas Jefferson
A common sense approach to bankruptcy is the recognition that no matter how much money you will be able to acquire you cannot possibly ever pay it back to your creditors. This is not what is required for a government regulating agency to declare a banking facility bankrupt, but it is a valid depiction of the state of our national debt and our ability to reduce it to a manageable quantity. The level of taxation that would be required to eliminate our national debt, which is climbing by astronomical numbers, would put such a strain on the fiscal ability of most Americans to survive we would instantly revert to a third world status. This is the danger we are confronted with by a free spending government unwilling to restrain its reach. Continue reading