Obama, The Fed, And The Phony Economic Recovery





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In a clever display of Marxist political maneuvering, President Obama and his “progressive” supporters are now attacking the substandard economic “recovery” that they have helped create. Zubi Diamond, author of the Wizards of Wall Street, says their ultimate goal is to increase federal control of the economy and “complete the fundamental transformation of America.”

The public understands something doesn’t add up. A Washington Post-ABC poll finds that 64 percent of the public thinks federal government policies currently favor wealthy Americans, while a new CNN/ORC poll shows that nearly 70 percent say the economy is generally in poor shape, and only 32 percent rated it as good.

This is after Obama has been president for five years, trying various tax-and-spending measures supposedly to spur economic growth.

The CNN poll finds that, “Thirty-six percent said they were cutting back spending on food or medicine, up from 31 percent in late 2008, the year the housing market collapsed.” Behind some apparently good economic numbers are “the long-term unemployed, the under-employed and those who have dropped out of—or never even entered—the workforce,” CNN reports.

This is a recovery?

Businessman Zubi Diamond calls it a “phony recovery,” based on the stock market rise driven by the Federal Reserve, that clearly has failed to help most Americans.

Diamond and other critics call Federal Reserve Chairman Ben Bernanke the “day trader Fed chairman” and “Magic Ben,” for his ability to print money and propel stocks to record levels. He is leaving office on January 31, to be replaced by Janet Yellen, who promises to continue the controversial policies that have given unprecedented monetary power and influence to America’s central bank.

Obama calls inequality “the defining challenge of our time,” even quoting the pope to that effect. But his policies, as carried out by Fed Chairman Ben Bernanke, have clearly exacerbated the inequality he now complains about. Such a claim enables Obama to avoid responsibility for his own policies and to campaign on a platform of reducing the inequality he has increased.

Talking about “inequality” seems to be the only way that Obama’s “progressive” allies in the media, such as New York Times columnist Paul Krugman, can change the subject from the lack of economic progress and opportunity—problems exacerbated by the disruptions to peoples’ lives caused by the socialized medicine scheme known as Obamacare.

What liberals like Krugman want the public to ignore is the fact that the politicians yakking the most about inequality—such as Obama, New York City Mayor Bill de Blasio, and Democratic Massachusetts Senator Elizabeth Warren—are backed by George Soros, the billionaire socialist hedge-fund operator who says capitalism is the major global threat. Soros almost single-handedly financially underwrites the “progressive” movement today.

The political reality facing the Democrats, as they ponder congressional elections this year, helps explain why a recent Post-ABC poll focuses on the so-called “wealth gap,” and whether ploys such as raising the minimum wage can turn things around for them. Another proposal is extending unemployment benefits.

The poll is worded in such a way as to be a prescription for more federal interference—some would call it socialism—in the economy. The Democrats, backed by Soros, believe this is how they can win.

But none of these proposals would increase the real economic growth that can help the millions of unemployed Americans get back into the economy and acquire good-paying jobs. Yellen’s confirmation as the next Fed chairman only helps the money manipulators on Wall Street, and does not filter down to Main Street, Diamond insists.

Putting the matter in personal terms, he asks, “Has Ben Bernanke’s artificially inflating assets and balance sheet in the economy reached your household and personal bank accounts yet?” He asks, “How come some communities and municipalities are filing for bankruptcy protection, and how come your personal bank account is not flooded with liquidity from the Fed?”

In this sense, he argues, the Obama “recovery” is worse than the so-called “trickle-down” pro-growth policies of President Reagan, which even the pope mocked in his recent papal “exhortation.” In the Obama economy, he says there is no trickle down, unless you have major investments in the stock market or have large accounts managed by the hedge-fund operators such as George Soros.

Diamond tells Accuracy in Media, “Do not get confused or be deceived by the rising stock market. It is not based on any fundamental recovery in the macro economy. It is artificially inflated. There is no fundamental economic recovery.” He says the “recovery” has basically consisted of the Federal Reserve assisting the stock market “with freshly minted U.S. dollars electronically transferred to a select group of primary broker dealers to replace the liquidity and buying power of the investors who fled the market due to fear and lack of investor confidence” in the wake of the 2008 crash. Diamond says hedge fund operators such as billionaire George Soros were behind the collapse in 2008, and Obama’s rise to power.

He explains, “Ben Bernanke’s rationale for doing this is to artificially inflate assets and balance sheets in the economy to create a wealth effect that will spur spending and economic growth.” In this Fed-induced stock market rally, he says, “the fact that the stock price of a particular company is rising does not necessarily mean the company is profitable or that the economy is doing well.”

Diamond, with 15 years of financial market experience, cautions people not to be confused by media misreporting: “When a talking head analyst points to the rising stock price of the electronics retailer Best Buy as proof the company is doing great business, and proof of healthy consumer spending, nothing can be further from the truth. Best Buy is losing money and closing down a lot of stores.”

“Since the Federal Reserve began their asset (stock) purchase program coupled with stock price manipulations, good earnings for the publicly traded companies do not really matter,” he says. “The price to earnings ratio valuation does not really matter, either. A fundamental or technical analysis of stocks or the market indexes does not really matter. The only thing that really matters is the activities of the world’s central banks led by Federal Reserve Chairman Bernanke.”

This is being done, Diamond maintains, because certain actors on Wall Street, like the hedge fund operators in the Managed Funds Association, want to see Obama turn the U.S. economy into a top-down command-and-control socialist-style system that eventually includes nationalization of the big banks.

“If the Federal Reserve continues the QE [quantitative easing] stock buying program in 2014, they will be holding up the economy artificially to lull you to complacency while the enemy of freedom remains in power to complete his fundamental transformation of America,” he says. “Things are not what they seem.”

 

This commentary originally appeared at AIM.org and is reprinted here with permission. 





Dangerous Make-Believe





Some things are real.  Some things are make believe.  Knowing the difference is critically, crucially important.

If I told you that you could safely drive off a 100 foot cliff at 80 miles an hour because your car would simply float lazily to the earth, I would be telling you something that is not real.  If you followed my advice, you would be acting very dangerously and suffer great harm – probably fatal harm.

The example I just used is easy to agree with because the physical laws of the universe, like the laws governing gravity and motion, are quite easy for us to discern.

But what about the moral laws of the universe?

If you, perchance, have swallowed the notion that these moral laws don’t exist, or that you can invent them and discard them at your will, or if you think that only the ones that you actually happen to believe in actually apply to you, then you may be careening carelessly toward that cliff.

You see, as my cousin Neal likes to say, “You don’t break the rules; the rules break you.”

And we might do well to remember that this is true not just for us as individuals, but also for our community and our country.

In my lifetime, my country has allowed the murder of 55 million of its own children.

In my lifetime, my country has invaded other nation states that did not invade or threaten to invade these united States, killing and maiming in the process thousands of Americans and countless innocent occupants of those places.

In my lifetime, my country has allowed its president, its legislature, and courts to lie and steal and commit treason with impunity.

In my lifetime, my country has debased its currency by printing trillions of worthless Federal Reserve Notes that are backed by nothing but foolishness.

And the law schools of my country have produced thousands of attorneys who have NOT been taught the true Source and nature of law.  Many of them are now judges and politicians.

These actions on the part of my country indicate that we no longer are acting in accordance with reality.  It is not real to think that a person, or a people, can do these things without disastrous consequences.

Shouldn’t we pay attention to what our founding documents declare?

When God made the world, he made physical and moral laws.   To think or to act as if they don’t exist is make believe – dangerous – deadly.

Learn more about your Constitution with Michael Anthony Peroutka and his “Institute on the Constitution” and receive your free gift.





One Reason To Raise The Minimum Wage…





US-BANGLADESH-TEXTILE-FACTORY

Now that the Obama, Reid, Pelosi triumvirate can no longer tout Obamacare as its “signature” achievement, they’re looking for a distraction.  A bad deal with Iran lasted three days in the news cycle.

Where to turn?

Why the minimum wage, of course.

I mean, really.  Who can live on $17,000 a year?  What family of two can live on $34,000 a year?

Here’s an idea.

Let’s make Walmart, McDonalds, and Burger King pay their workers $15 an hour. If we did that, everything would be just fine.

People would make $31,000 a year, and all would be right in the world.  Right?

Not so much.

I’ll bet the immediate effect at Walmart would be robot stockers, self-checkout lanes, and really poor service.  Not to mention higher prices.  Do you really think that the two liter bottle of Diet Cherry Dr. Pepper would continue to retail for $1 at Walmart?  Do you really think that the Burger King French Fry burger would still be $1? Or any size drink at McDonalds would still be $1?

Let me tell you about a business I know intimately, the radio business.

Back in the day—prior to 2008—we hired a lot of high school kids and college kids at minimum wage to do things at the radio station, hoping some of them would stick.  In baseball parlance, they were our farm system.  The developmental league.

Today’s minimum wage of $8.25 an hour places an impossible burden on a small business like most radio stations are.  But we have a solution.  Computers can do most of what the kids used to do. The net effect is that we now hire almost nobody because computers work for free. If you can sell, you can make some money.  If you’re a talented air personality—either local or national—the pay can be reasonable.  But we’ve learned to do without employees who, frankly, cost too much for the return we get on the jobs they do.

Do you really think that the McDonalds, Burger Kings, and Walmarts of the world can’t automate many or even most of what they hire minimum wage people for today?

Go look at today’s warehouse for the answer to that question. You’ll see robots moving material from the start to finish of the process.

Part of it is disruptive technology.

But a big part of it is that the Federal and State governments have made it extremely difficult and expensive to have employees for almost any size business.

The other issue is that raising everybody’s wages simply devalues the currency.

If it’s one thing the Obama Administration should understand, it’s that.

Unfortunately, they seem to think that devaluing the worth of the United States Dollar is a good thing.  All of the printing presses that the Federal Reserve controls won’t devalue the currency as much as doubling the minimum wage.

Making the generous assumption that jobs won’t disappear, a straight doubling of the minimum wage will cause everything from rents to car payments to increase, thus negating the reason the wage was raised in the first place.

Now I want you to think about something.

These are the same people who brought you Obamacare.

I just learned this week that a bunch of prescription drugs I used to be able to buy at Walmart for $4 a month have tripled in price.  The same drug had been on the $4 list for the last six years; and all of a sudden, the month before Obamacare goes into effect, it’s off the list, and the price triples.

That’s known as an unintended consequence.

Do you really think that the same people who created the poster for unintended consequences should be allowed even more control of the job market?





An Open Letter To The Republicans In Congress





Cantor Boehner Republican Congress SC

Dear Republicans,

There is one thing that you need to do to do right by our country and save your butts at the same time. I will get to that in a minute.

The biggest problem facing our country right now is our federal debt. The second biggest is Obamacare.

If President Obama finishes his second term in office, our debt will be around 20 trillion dollars. The Federal Reserve is essentially printing money as fast as it can, which makes all the money we already have worth less.

As our dollar devalues, the price of imports increases since, of course, we don’t make anything here anymore.

We are dependent on several foreign countries to buy our debt; and that dependency allows them to have too much influence on our foreign policy, as we are afraid they will cash in our debt.

There is also movement among some countries to replace the dollar as the world’s reserve currency, and that will collapse our economy. That will make 2008 look good by comparison.

You are not educating the American public about what is happening here or what is at stake. The media is not helping here, but I have a proposal below.

There are two reasons why Obamacare must be stopped.

The first reason is that the government will now subsidize health insurance premiums for millions of Americans. They don’t want to talk about how many; but within a few years, I have no doubt the number would easily reach 30 million people and keep increasing, much like how the food stamp program has mushroomed under Obama.

Obamacare involves a major expansion of our government when it is already crushing us with its debt. So with debt destroying our country, they want to spend billions more each year on a new government program.

The second reason is that it will create another huge class of people who will now be depending on the government just to get by.

So the current trend in our country is fewer people working for less money and fewer hours to support more and more people who are dependent on the government.

We have the debt ceiling crisis now; and if we default, you may get the blame because the message is not getting out. Raising the debt ceiling without funding Obamacare will certainly put Obama as being responsible for a default, but the media won’t help you.

So what do we have to do?

Three things.

At some point (now is probably too soon), you have to declare that after such and such date, there will be no more debt ceiling increases.

And then you need to declare that apart from World War 3, another Pearl Harbor, or 9/11, the only major business the House will conduct is how to shrink our budget. No immigration, no gun control, nothing. This is the most important thing you can do.

Then you need to sell to the public what is wrong with this debt. Just to say that every person owes so much means nothing. To say that our grandchildren are saddled with this debt means nothing.

You have to tell them how the government is stealing your money, making it worthless, and driving your standard of living into the toilet (unless, of course, you work for the government.) You need to tell them how paying for government sucks money out of the economy. They will tell you that government employees pay taxes too and buy things that help the economy, but they are using your money to do it. A government employee is like supporting a neighbor down the block as well as your family. Another mouth to feed. So how does that help you buy the things you want?

Without these three things, our economy will collapse; and if it doesn’t collapse before the next election, you may face a real hard time because you won’t have the media telling the whole story.

This is the only way you can get the story out. Don’t give the media any other stories, and solicit public input on where we need to cut.

You have had control of the House for 2 ½ years, and spending hasn’t really changed. This is your last chance. That was why you were elected.

Thank you.

Larry Craig

An Open Letter to the Republicans in Congress





Cantor Boehner Republican Congress SC

Dear Republicans,

There is one thing that you need to do to do right by our country and save your butts at the same time. I will get to that in a minute.

The biggest problem facing our country right now is our federal debt. The second biggest is Obamacare.

If President Obama finishes his second term in office, our debt will be around 20 trillion dollars. The Federal Reserve is essentially printing money as fast as it can, which makes all the money we already have worth less.

As our dollar devalues, the price of imports increases since, of course, we don’t make anything here anymore.

We are dependent on several foreign countries to buy our debt; and that dependency allows them to have too much influence on our foreign policy, as we are afraid they will cash in our debt.

There is also movement among some countries to replace the dollar as the world’s reserve currency, and that will collapse our economy. That will make 2008 look good by comparison.

You are not educating the American public about what is happening here or what is at stake. The media is not helping here, but I have a proposal below.

There are two reasons why Obamacare must be stopped.

The first reason is that the government will now subsidize health insurance premiums for millions of Americans. They don’t want to talk about how many; but within a few years, I have no doubt the number would easily reach 30 million people and keep increasing, much like how the food stamp program has mushroomed under Obama.

Obamacare involves a major expansion of our government when it is already crushing us with its debt. So with debt destroying our country, they want to spend billions more each year on a new government program.

The second reason is that it will create another huge class of people who will now be depending on the government just to get by.

So the current trend in our country is fewer people working for less money and fewer hours to support more and more people who are dependent on the government.

We have the debt ceiling crisis now; and if we default, you may get the blame because the message is not getting out. Raising the debt ceiling without funding Obamacare will certainly put Obama as being responsible for a default, but the media won’t help you.

So what do we have to do?

Three things.

At some point (now is probably too soon), you have to declare that after such and such date, there will be no more debt ceiling increases.

And then you need to declare that apart from World War 3, another Pearl Harbor, or 9/11, the only major business the House will conduct is how to shrink our budget. No immigration, no gun control, nothing. This is the most important thing you can do.

Then you need to sell to the public what is wrong with this debt. Just to say that every person owes so much means nothing. To say that our grandchildren are saddled with this debt means nothing.

You have to tell them how the government is stealing your money, making it worthless, and driving your standard of living into the toilet (unless, of course, you work for the government.) You need to tell them how paying for government sucks money out of the economy. They will tell you that government employees pay taxes too and buy things that help the economy, but they are using your money to do it. A government employee is like supporting a neighbor down the block as well as your family. Another mouth to feed. So how does that help you buy the things you want?

Without these three things, our economy will collapse; and if it doesn’t collapse before the next election, you may face a real hard time because you won’t have the media telling the whole story.

This is the only way you can get the story out. Don’t give the media any other stories, and solicit public input on where we need to cut.

You have had control of the House for 2 ½ years, and spending hasn’t really changed. This is your last chance. That was why you were elected.

Thank you.

Larry Craig