I want all of you to be sure to watch this must-see video, titled Wealth Disparity in America:
Interesting video, huh? Where do you think things are headed when the top 1% of all Americans have 40% of the wealth, and own half of all the stocks, bonds and mutual funds? The bottom 80% have only 7% of the wealth, and the bottom 50% only have ½% of the wealth – and they are barely scraping by. I have alluded to the shrinking middle class and I have occasionally discussed the disparity of income – but these numbers are sobering. And as bad as things ARE, the incredible thing, pointed out by the video, is that what most American’s perceive as the “reality” is actually MUCH WORSE than they think.
It’s common knowledge that the consumer accounts for nearly 70% of the GDP, but the consumer is made up of 80% of the people who only have 7% of the wealth, and they really don’t have the spending power to fuel the economy any more. The top 1% park most of their money in “investments,” and do not materially move the overall economy. The economy is not a 10-carat diamond ring or a Bentley, or an ocean-side mansion in West Palm Beach. While the Bal Harbour shopping mall (catering to the rich and sporting the highest sales per square foot of any shopping mall in the world) is packed every day, and doing fine, the big box retailers are closing down up to 3,000 stores around the country in 2013. The rich don’t feel the pinch, but most of my readers probably do. Rich is not making a few hundred thousand dollars a year – that allows for a very nice life style, but it is definitely not rich. No one told Obama.
Our business at Miles Franklin is as strong as it was last year, so my income should remain about the same – but my state and federal taxes are going up significantly, and so are my costs. I have less left over to spend. The same is probably true for most of our readers. If we are lucky, we will get by, but it gets harder every year. The top 1% have no problem at all. The top 10% are doing pretty good. As for the rest – well if you are part of the other 80% or 90% you already know the answer to that.
I am not suggesting socialism – an equal distribution of wealth across the board. We need an economy based on incentive and hard work, but what we have now is outrageous. And whom do we have to blame? You could start with the Fed and congress. They are the ones passing the laws, doling out the money and making sure that it all gets into the hands of the 1%. Trouble is, it doesn’t get spread around from there on down. It sticks with the ultra-rich. That, dear readers, is an environment that breeds envy, anger and at some point riots in the streets – like what we see happening in the Middle East and Southern Europe right now. It’s all just beginning. Time for another war? That is the usual solution to domestic violence.
I also want to call your attention to a very enlightening article, courtesy of our friend Bill Murphy, at LeMetropole Café. I have subscribed to the Café since 2001 and highly recommend it as a very useful source of information. They are at the cutting edge in explaining the manipulation of the gold and silver markets and actually started the “trend.” The article is by Jeff Nielson and it’s titled U.S. Corpse-Economy Still Losing Jobs. The amazing thing about the economy that Nielson discusses, is that it is as bad as it is IN SPITE of a record-setting Dow and the trillions of dollars thrown into the mix by the Fed. How can this be? Simple, the economy is not what the media would have you believe it is. The headlines are simply not true. Trouble is, most of the people I know think I am the nut case for doubting the MSM reports. Well, check out the LeMetropole Café article, let your “eyes” do your thinking and hopefully you will let the cold hard facts sink in. Especially you, Backwoods Jack.
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