Why The Rich Are Getting Richer, and the Middle Class are Getting Poorer
I’m looking over material on the affects of quantitative easing on American society, and I was fortunate enough to find and article by Michael Snyder of the Economic Collapse blog, who has made an extensive study out of the effects of quantitative easing and it’s affects on American society. What I’ve found is the huge correlation between quantitative easing, and the growing chasm between wealthy and poor Americans. The article sites one Andrew Huszar, who is a former federal reserve official and whistleblower, and has come out apologizing for what they have done to the American people. He said that quantitative easing has done nothing for the average person, but has been “the greatest backdoor Wall Street bailout of all time.”
Despite what many media outlets are advertising, the economy is not improving under the Fed’s actions. This Fed whistleblower is telling the truth. Snyder points out that the employment statistics in the U.S. have not improved under quantitative easing. He advocates that we should not be trusting what we are told by the mainstream news everyday. I couldn’t agree more. Household median incomes are down, yet the U.S. stock prices have doubled, and stock prices of Wall Street banks have tripled. Snyder poignantly asks, “who benefits from quantitative easing?” I think the answer is pretty clear. Andrew Huszar came to the same conclusion. Andrew managed the Fed’s purchase of about $1.25 trillion of mortgage-backed securities. He is now apologizing for what has transpired. He said, “I can only say: I’m sorry, America. As a former Federal Reserve official, I was responsible for executing the centerpiece program of the Fed’s first plunge into the bond-buying experiment known as quantitative easing. The central bank continues to spin QE as a tool for helping Main Street. But I’ve come to recognize the program for what it really is: the greatest backdoor Wall Street bailout of all time.”
Husazr admitted that it was obvious that after the first round of QE measures were taken, that it would do very little for the American people. He further explained, “Trading for the first round of QE ended on March 31, 2010. The final results confirmed that, while there had been only trivial relief for Main Street, the U.S. central bank’s bond purchases had been an absolute coup for Wall Street. The banks hadn’t just benefited from the lower cost of making loans. They’d also enjoyed huge capital gains on the rising values of their securities holdings and fat commissions from brokering most of the Fed’s QE transactions. Wall Street had experienced its most profitable year ever in 2009, and 2010 was starting off in much the same way. You’d think the Fed would have finally stopped to question the wisdom of QE. Think again. Only a few months later—after a 14% drop in the U.S. stock market and renewed weakening in the banking sector—the Fed announced a new round of bond buying: QE2. Germany’s finance minister, Wolfgang Schäuble, immediately called the decision “clueless.” That was when I realized the Fed had lost any remaining ability to think independently from Wall Street.”
This information is obvious to anyone who understands the history of the development of the federal reserve. It is in fact, a banking cartel that is fully vested in the success of banks on Wall Street. QE is not a measure designed to help average Americans. We will soon be releasing a video that explains the history of the federal reserve, so that you can all have a better understanding. It should not be a surprise to anyone that QE is simply a massive subsidy for Wall Street Bankers. The Federal Reserve is neither federal nor a reserve. It’s a collective of banks who are striving to protect their own interests. Husazr is not the only one exposing the Fed. Billionaire hedge fund manager Stanley Druckenmiller spoke his mind on the matter in an interview with CNBC, after the Fed decided not to “taper.” He said, “This is fantastic for every rich person. This is the biggest redistribution of wealth from the middle class and the poor to the rich ever. Who owns assets—the rich, the billionaires. You think Warren Buffett hates this stuff? You think I hate this stuff? I had a very good day yesterday… I mean, maybe this trickle-down monetary policy that gives money to billionaires and hopefully we go spend it is going to work,” he said. “But it hasn’t worked for five years.”
The Federal Reserve continues with QE infinity, and has been doing so for 5 years. Should this be a signal to all of us? Over the last five years, we have been seeing the gap between rich and poor widen substantially. The Fed is doing exactly what it was designed to do, protect banks, and make them wealthier. These people know exactly what they are doing. To reinforce this idea, a study conducted for the Bank of England has recently shown that QE increases the gap between the rich and poor. It found that the Bank of England’s policies of quantitative easing, which are similar to the Fed’s, had greatly benefited the wealthy, above all else. It stated that its QE raised the value of stocks and bonds by 26%. About $970 billion. 40% of those gains went to the pockets of 5% of the British wealthy class. So, we can see the QE results in an exacerbation of income inequality. It’s true for Britain, and it’s true for the U.S.
U.S. Stock prices have gone up over 100% while Obama has been in office. So who is benefiting? No question, it’s the ultra wealthy who own a majority of the stocks in the market. 82% of all individually held stocks are owned by the top 5% of wealthy Americans. It doesn’t take a genius to recognize that these practices aren’t benefiting most people. Wages are down, and unemployment is up for those who don’t own all that stock. The percentage of working age Americans has dropped form 60.6% to 58.3% . The median household income has also dropped for five years in a row. Poverty has also increased dramatically.
The Real Problem With Quantitative Easing
The fact that QE is hurting average Americans is a huge problem, but it’s not the worst problem. The biggest problem faced with QE, is the fact that it is destroying worldwide confidence in the dollar. Michael Snyder makes the comparison of the Federal Reserve practices with those that took place in the Weimar Republic. The amount of U.S. dollars in the system is exploding now, like it never has before.
We sit in our living rooms, and see how Wall Street is performing well, and think, “wow, the economy is really improving.” The rest of the world looks at the QE practices of the Fed and are thinking, “Why are we using the dollar as the reserve currency on our small planet.”
The rest of the world is beginning to steer away from the dollar. When this accelerates, Our ability to import oil and other commodities will diminish because of the increased cost. As the Fed infuses the system with money, buying up bonds, it really affects the U.S. economic stance around the world. Michael Snyder further explains the international implications, “major exporting nations such as China and Saudi Arabia end up with giant piles of U.S. dollars due to their trading activities. Instead of just sitting on all of that cash, they tend to reinvest much of it back into U.S. Treasury securities. This increases demand for U.S. debt and drives down interest rates. If the Federal Reserve continues to wildly create money out of thin air with no end in sight, the rest of the world may decide to stop lending us trillions of dollars at ultra-low interest rates. When we get to that point, it is going to be absolutely disastrous for the U.S. economy and the U.S. financial system.”
Snyder says that if you don’t believe him, just read this.
This Was All A Conspiracy
This destruction of the economy has been carried out by design. The global banking interests embodied in the Fed and the Wall Street banks will do everything in there power to widen the wealth poverty gap. These banks are using a tactic to gain more wealth and power. This tactic has been performed throughout history, and is referred to in literature as “pressure from above and below.” The idea is that the power structure of the global banks lays a foundation for chaos economically, which given the international complexity, simultaneously raises the threat for war. In light of this contrived threat, the banking powers pulling the strings give a “solution” to the problem. The solution comes in the form of collectivism, where the public accepts measures in a unified attempt to thwart the “enemy”, which economically would be capitalism, and an international foe like China. So, put simply, they create the problem, then create a solution that puts them in control of the general public. G. Edward Griffin explains this well in his film, “The Capitalist Conspiracy.” Here is a brief excerpt from the film that articulates the tactic well:
The establishment is playing the resistance right into their hands. There is all sorts of misplaced anger that is being used as a tool, by the establishment. A great example is the Occupy Wall Street movement. This whole movement was designed by the establishment. President Obama gave his informal endorsement of it, and yet, was instrumental in bailing out Wall Street, and flooded his cabinet with former Wall Street people. Conversely, many misguided Republicans attempt to defend banks and corporations that are operating under the guise of capitalism.
In a nut shell, the reality is that this banking cartel has hijacked capitalism, turned it into corporate fascism, and uses collectivism in the form of socialism or communism, as a “solution”. The public is then left poor, while the elites who control the system grow in wealth and power.
Many people have been played to think that this is some kind of battle between the left and the right. It’s really a battle between liberty and collectivism. The elite of the world will use any political system to their advantage.
Here is the full G. Edward Griffin Documentary, The Capitalist Conspiracy. It’s a concise depiction of the power structure that has controlled our monetary system for many many years.