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Member since: Thu Oct 5, 2006, 02:23 PM
Number of posts: 2,561

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Stockman's criticisms of the Fed are valid, but his assumptions and reasoning are flawed.

While Keynesian economics may be cited by the Federal Reserve as the rationale for its policy of easy credit, its activity is actually promoting "trickle down" economics for the benefit of the 1 percent.

As Stockman suggests in the article, easy credit is being used by those who already have some significant wealth as "free money" to "gamble" in the real estate and stock markets.

Keynes' postulated that governments should spend money on infrastructure to provide jobs and income for workers who would then be able to purchase goods and services (increase demand) and thereby grow the economy and create more jobs.

The Fed, by keeping interest rates artificially low, is actually damaging the economy, by cheating depositors out of a realistic return on their savings. Unemployed people cannot borrow and spend money when they have no income to repay the loans.

Moreover, bank depositors earn less on their savings than the current inflation rate so they lose principal.

Meanwhile, the wealthy get essentially "free" money to rig the stock market, buy out existing American companies and ship the jobs to China, and send the profits to tax havens such as the Cayman Islands.

Federal Reserve policy is NOT the solution to our economic problems. The Fed is a primary CAUSE of our current economic problems.

Capitalism is NOT an economic system. It is a religion.

The suckers (i.e., the non-1 percenters who "gamble" in the stock market) hold fast to the fiction that they can "beat" the system and come out the winner.

As in any gambling system, the house always comes out ahead by taking a cut of the gambled money. The 1 percent always comes out ahead. The money (the "capital gains" of the few winners among the 99 percent comes not from the 1 percent, but from the losses incurred by the losers among the other 99 percent.

The results are that some of the 99 percent make some "profit", a larger share of the 99 percent loses their "investment", and the billionaire players who rig the system take a big share of the losses of the 99 percent not won by the 99 percent that gained some "profit".

The 99 percent who refuse to see how the system is rigged are of the same mind-set as the climate change deniers. They refuse to understand the way the capitalist system actually works.

Their faith in the capitalist system is the same as the religious fundamentalists who believe that the Earth is 6,000 years old, and that Adam and Eve rode around on dynosaurs.

Interestingly, and unfortunately, the fiction of the mythology called Capitalism is more ingrained in the population, than the mythology of Creationism.

Wall Street and the banks work the stock market to run their Ponzi schemes.

The information at the link you provide helps explain how it works.

Reading the comments section at the link is also informative.

The stock market is NOT an indicator of the health of the REAL economy.

How quickly people forget Enron, as well as the boom-and-bust of the stock and real estate markets driven by "bad" mortgages and mortgage-backed securities.

The "value" of the Stock Market is based on the supposed validity of "trickle down economics" and the existence of Santa Clause and the Tooth Fairy.

In the current economic situation, the real winners in the stock market are the 1 percent who can manipulate stock prices by buying and selling large blocks of stock in a coordinated way.

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