Oh, No! Not Another One?

 

Quite often you can see things otherwise invisible when you look at a big picture.. For example if you were flying from San Fran to Bangor, ME, no one in your interactions along the way would be able to tell you what was happening across the entire route in real time.  You simply trust that and hope all will end well.

But if you are at a console watching air traffic control across the entire United States, and noticing how suddenly those little plane shapes disappear whenever they cross the Mississippi anywhere between Memphis and Cedar Rapids, you know from that anomaly that something must be wrong… You don’t know what, but only you see it from looking at the macro picture, a hole developing into which those entering, never return.

Which is why some of us like to look at macro math.  Basically it is stuff that no one else thinks is important and for most of daily living, they are correct.  But if you are used to looking at the same picture every day and one day it is different, a person familiar would notice that.  No one else would.  Imagine waking up one morning and walking through your house and quickly looking up from your footsteps, seeing that portrait you have hanging on the wall has its subject facing left, instead of right… You would be unnerved, right?  Yet a visitor to your place, would not notice.

Here is where we are. We are already in a free-fall towards another financial crises which if not addressed quickly, will repeat 2008-9 and possibly be bigger. It is strongly possible that this summer quarter’s financial reports leaking out in October, will cause a crash similar to what happened 8 years ago….

I’m sure this is a surprise to you as it was me. I sure you are as skeptical of my telling of it, as you would be my insisting I saw my portrait whose image had been flipped during the night..  Main stream’s financial media and both political parties are still asleep and dreaming of the promise that the economy is buoyed and is roaring back.  Just like how we all get surprised when acquaintances of ours, actively healthy people, suddenly confide they’ve been diagnosed with terminal cancer.  That is the cruel side of life. Sometimes the outside does not properly show the hidden condition on the inside.

What has not been shown in all our financial reports, is the massive amount of quantitative easing buoying these glowing results.  QE for short, is where government prints money costing nothing, and then spends it on something. They could loan it.  They could donate it.  They can buy stock with it. They can do anything with printed money that can be done with circulated money… And in a recession, this policy works… (which is why we do it)… Businesses get loans and stay afloat; banks get loans and keep their doors open. But the last recession was 8 years ago, and across the world’s financial markets, certain actors still are doing it…

So in our newscasts we appear to have a great recovery just before the elections. Our stock market is high, our unemployment is quite low, and our corporate profits continue to rise.  Is their any other way to measure it?

But does it make a difference to you if the reason the stock market is high because many of the stocks are now owned by government entities involved in quantitative easing, bought at low times to boost prices keeping plummeting crashes from continuing?  Does it make a difference that corporate profits are continuing because of massive increases in corporate debt primarily taken on to avoid showing a negatively balanced profit sheet, debt often owed to government entities which bought them up when no one else would to help keep their prices high… Does it make a difference if I told you that despite all the newly minted private sector jobs now being generated at reduced wage levels from skeletons of the older jobs now gone, the entire total income now being generated by all those working, is less per person than was before the great recession of 2008-9?  But you knew all this, right?

When put all together, the bottom line is that our economy is actually in a recession if measured by “real” corporate profits being down,  by “total amount of generated wages” impacting the economy being down,  by corporate “revenue streams” across our business world, being down,  by our “stock market minus QE infused purchases” being down,… but the supports provided by QE hide these facts from us all.  And it is not just here in the US. It is even a bigger global problem. There is the EU who prints money for every Southern European economic crises.  There is Japan who prints money to prop up everything. There is the ongoing problem in China. There is Britain who is now pumping to keep Brexit from collapsing its economy. Globally in just one quarter, we witnessed QE soar to never-before-seen levels. and it hasn’t stopped climbing.

Have you noticed how even with bad economic news, stocks go up?  That should not be — a reality which is obvious to grasp when parsed this way….

“Uh-oh, looks like you are going to lose a lot of money/  Oh! No problem, I’ll just buy more stocks at a higher price then..”  Time in and time out, this is exactly what happens.

QE is buying those stocks… and we’ve reached the level where there are so many, there is no one there to sell them too… Bond yields are negative and yet they keep buying.

“We are therefore in uncharted waters and it is impossible to predict the unintended consequences of very low interest rates, with some 30% of global government debt at negative yields, combined with quantitative easing on a massive scale” —Chairman Lord Jacob Rothschild of Rothschild Investment Trust

Notice how across the globe, governments are now buying up $180 billion a month or $30 billion per month higher than all the QE in the world at the peak of the Recession (2009).

Now jump to the crux of the problem.

Did you notice the climb of negative yield debt just in the past 8 months. Aren’t negative yields dangerous?

Can be. Already one third of all sovereign debt yields negative interest rates. That means that investors are effectively paying borrowers to lend to them. The Bank of Ireland and Royal Bank of Scotland already charge depositors interest, as opposed to paying depositors interest.   That’s bizarre. Not to mention unsustainable.

At the current rate of decline, the entire global market will be in subzero land by the end of the year.

 

Around 45% of the global “fixed income” market is now “compromised” by central bank buying.” 

This is compounded by the new fact that nearly half of the bond buyers in the world don’t care about price because they print money out of nothing.   So what does this look like? Take Japan, for example.

Japan’s biggest banks are running out of room to sell their government bond holdings, pushing the central bank closer to the limits of its record monetary easing.   Finding willing sellers is a headache for Governor Haruhiko Kuroda as the central bank prepares to review policy at next month’s board meeting, amid growing concern among economists that he has few tools left to revive the economy. Record bond buying has already saddled the Bank of Japan with more than a third of outstanding sovereign notes, draining liquidity from the market and making it more volatile.

As proof of this trend, on August 9th, the Bank of England couldn’t find enough bonds to buy.

In plain terms it is as if you were now living solely off borrowed money and constantly getting new loans just to make the payments on your past due old loans and then suddenly, not being able to get any new loans anymore……

As we can see from the first chart above, Japan’s “need” is near $90 billion a month, which means once the loans potential dries up… there is an $90 billion dollar hole into which everything collapses…

Don’t underestimate what is happening here, the BoJ is buying a lot more than just sovereign bonds.

The Bank of Japan’s controversial march to the top of shareholder rankings in the world’s third-largest equity market is picking up pace.  Already a top-five owner of 81 companies in Japan’s Nikkei 225 Stock Average, the BOJ is on course to become the No. 1 shareholder in 55 of those firms by the end of next year, according to estimates compiled by Bloomberg from the central bank’s exchange-traded fund holdings.

 

Japan may be the extreme example, but they are hardly alone.  

The balance sheet assets of the world’s six major central banks hit a new all-time record, increasing to $16.9 trillion from $4.9 trillion 10 years ago, a 239 percent increase.  All the major global central banks are buying up financial assets to the point that global liquidity is drying up. In other words, the central banks are becoming the markets.  Markets have become so distorted by central bank activity that they are no longer transmitting very useful information about the economy at all.”

Bad as this may sound, this is still not the real problem  Here is the REAL scary problem. These low negative rates in safe bonds are sending buyers out in droves to the unsafe markets to find any yield, even small ones of 5%.  In these markets the risk looms so large for so small a payoff, that one day’s trade can wipe a years of yield right off the books.

Volume in emerging markets have soared double their previous record in volume sold since March.

But that is just one example

Junk bonds, rallied 48% this year, even while junk bond defaults have hit five year highs.

Corporate debt.

Corporations are issuing record amounts of debt, and investors and QE are gobbling it up.

Companies worldwide are poised to raise more than $100 billion so far this month, the most for the period in Bloomberg data going back to 1999…. The average yield on sterling-denominated corporate bonds has fallen to a record-low 2.19 percent, according to Bank of America Merrill Lynch index data. Globally, the average is near the lowest ever at 2.3 percent, the data show.

More than $2.3tn of dollar-denominated debt has already been issued by companies and banks since the year began, including three of the ten largest corporate bond sales on record, Dealogic data show.   Which makes perfect sense…until you factor in that corporations are defaulting on debts at a near crisis level.

The year is half over and we are already at the 60% level of 2009……….

According to a new report from Standard & Poor’s Global Ratings, corporate debt around the world is massively on the rise and could skyrocket to $75 trillion from the $51 trillion it’s at now…. What’s more – S&P estimates that two out of five corporations are highly leveraged (meaning they’ve taken on too much debt). About 43% to 47% of corporations globally are at a financial risk level.

EBITDA = (Earnings Before Interest,Taxes, Depreciation, Amortization)
Far, far above the 2009 recession levels…

But why are corporations the world over, all taking on debt at the same time (we are just finding out now because reports are filtering out from June 2016)?….

Because operating cash flow doesn’t cover it.

 

In Q2, companies generated $425 billion in operating cash flows. Only $151 billion was invested in fixed assets. The lack of investment is the bane of the US economy. And:

 $110 billion went into dividend payments.    

$61 billion was used for takeovers (OK, that’s down from last year)    

$137 billion was blown on financially engineering their earnings via share buybacks.

So operating cash flows were $35 billion short. That happened quarter after quarter. Hence debt ballooned to 32% of total assets at non-financial firms, the highest since 2008, another propitious year.

As you can see in order not to disappoint shareholders, corporate entities are taking on low interest debt simply to keep their profits looking pretty for the short term.  As seen above one could easily avoid debt by

• a) cutting dividend payments,
• b) stop taking over other businesses, or
• c) stop buying back your stock to increase earnings/share…..

No, but none of these superfluous options got cut back, debt was taken on to cover them…

(As an aside, if anyone is wondering what is still wrong with the American economy, the number of whopping total of $61 billion applied to takeovers compared to an anemic $151 billion into capital investment, says it all… )

You must be wondering!  With all this bad news, why is the stock market climbing so precipitously?  Who would put money into a struggling company laden with debt (32% of assets) which cannot meet profit targets without taking on even more debt?  Let me guess. You? You are going to go out and buy some debt laden stock right now, correct?  Of course, you’ll put your whole retirement plan on it, correct?

Well, yes. If you have anyone minding your money, a mutual fund perhaps, I’m sorry, but this has already happened to you.  For in the short term, it has become the only way to get any yield at all.

Today’s precarious stock market scenario only makes sense when compared to negative bond yields… From the comparison chart above, you can see that this is a new phenomenon.  Accounting for the negative bond yields, today, you make 70% more in stocks than you do in bonds…

With a bubble stretched this thin, and with ample covering up so much bad financial news, the danger becomes very real that a tiny pinprick from somewhere, whether coming from student loans, junk bonds, emerging market bonds, corporate bonds, equities, or sub-prime car loan bonds, causes negative losses more than the ability of one to pay……

When disaster finally happens there will be another rush for the exits everywhere, and that is where the fatal flaw in the system will be exposed: there is no liquidity in the markets….

The World Bank estimates the ratio of non-performing loans to total gross loans in 2015 reached 4.3 percent. Before the 2009 global financial crisis, they stood at 4.2 percent.     If anything, the problem is starker now than then: There are more than $3 trillion in stressed loan assets worldwide, compared to the roughly $1 trillion of U.S. subprime loans that triggered the 2009 crisis….

Mr. Businessman calls up his bank… I need a loan right now, quick!   ….. Sorry says the bank. We’re out of money…..

The one solution?  Pretty painful.. Raise interest rates,.  which will result in downward pressure globally on all portfolios, dropping overinflated stock like its hot, but… will dothe necessary job of stopping corporate debt-load from continuing to grow and return us to more accurate reporting. Raising the interest rates act like chemo therapy to the economy, providing long-term healing by actually killing off parts of the living body to keep a malignancy from spreading to healthy tissues… When given the choice, very few of us choose to die forthright, instead resign to taking the chemo.  As we struggle with the decision, at the end of our thought process we all succumb to choosing that option at the end, coming to the realization that either way, we die, and at least therapy provides us the option of more time….

These implications hitting in October are anyone’s guess to their impact on this election year.

Greed 101

One of the denizens over a Kilroy’s decided to jump into an economic argument throwing pies.

In the process of us demolishing his ignorance all of us realized he’d never been taught how corporate profits work. It then occurred to some of us that perhaps some of the reason the really “common-sense” arguments of how to “make America great again” have not resonated, is because perhaps a lot of you out there also don’t know the real shape things are in either….

This is not a screed. This is just a demonstration of where things are… using data and charts that are very easy to find only if you know where to already look (FRED) and very hard to find if you don’t know where they are…

We’ll start with a parable…..

Once upon a time there was a family whose last name was Quintiles… A little larger than average they were nuclear with a father who worked, a mother who also worked and 3 children spaced roughly 3 years apart…

The mother went back to work when her first child reached teenager status. They had unlimited food… All they ate was pie (there is a joke there). As the children were growing up, the mother portioned out the pie for all so all could get enough to eat….

When the mother went back to work she taught her oldest to put the pie in the oven and feed the children while leaving two pieces for the parents when they returned home.

He was to divide the pie into five pieces and give everyone their share… For a while they monitored the portions closely then seeing no issue never looked at it again. ..

Over time the portion being retained by the teenager gradually grew in size. After all he was cutting. The children couldn’t complain. And the parents never knew because he left portions for them that were consistent.

The smallest got it worst.. Being small and weak he lost the largest share of his portion first. After getting used to living on that bigger piece, when desirous of more pie, the oldest then began sliding the knife inward on the middle child’s portion… It got smaller and smaller.

Then he begin trimming Mom and Dad’s. who were really too busy to notice or care. In the end he was eating half the pie, and the other four were sharing the other half….

One day, the littlest one complained. Then the other four noticed they too had smaller portions. They banded together, and re-arranged duties so the first child now carried out the garbage and the other two children got to rotate pie cutting duties…

They all had enough food forever. However the oldest one threw a fit.. “Not fair”, he cried… “You all get more food, and I’m losing it… This is Socialism”. Eventually when his pleas had no listeners, he too shut up and was content with his “never-ending” piece of pi….

The end.

What does that mean you say? Master, please explain…

Ok.. so you may be clear. The family is American society. The earners are the American working class who earn and buy things that fuel the economy. During Conservative rule, the American people elected to let corporations be what run our government and by extension, our lives… They were put in charge of the government and for a while it was nice. Then they started wanting more. With no greater force to stop them, they took more and more and more.

Everyone else got less. They got more. Everyone else’s pie got smaller and smaller though the entire pie stayed the same. Those with smaller pie pieces were given a litany of excuses including saying they had no choice. Hard times were upon us. But no one was looking at what they were getting as they made our lives more miserable.

Finally the bottom class said we can’t live on $7.25 an hour, and the conversation got started. Everyone realized their portions too had decreased, and that all that decrease had accumulated to the pie of the ones who’d been appointed to do the cutting with no supervision or regulation or negatives for doing wrong.

They got together, changed the rules, forced the recalcitrant child to obey, and he screamed “Socialism”… and threw a fit.

The fit was ignored and the tantrum stopped. The child ended up being happy getting enough to live on as was everyone else…

Nice story.. you said something about charts?

This is the chart showing time since we began keeping records.  Notice the gradual increase in the inclines in the Clinton years, steeper in the Bush years, and steeper in the Obama years.

Even looking at this chart can be misleading.  For example in the Clinton years the rising tide did raise all boats.. Corporate profits rose because every level of income also rose, from poorer to richest.  Anyone living during those times of higher federal taxation did better each year than the year before.  But, with the cuts of the Bush era, the benefits only went to top earners, something Obama was not able to change with the Tea Party holding down both houses  and tax increase on the wealthy, during his term…

So a better guide would be the ratio of Corporate Profits (CP) to the total pie (GDP). This would show the how much corporate profits were taking of the finite pie.

The thing to remember when viewing this is that America’s middle class’s greatest times were between 1950 and 2000… The chart shows why.

The numbers on the left stand for percent of the national pie… At Bill Clinton’s swearing in, the national pie was divided 5% to corporations and 95% to the people. Today it is at 11% for corporations versus 89% for the people….

We, The People, under the new rules written by the corporations, for the corporations, and of the corporations, have been squeezed out of 6% ….. (6% which now mostly goes to  the top earning 16,000 people)

Currently our GDP is around $18 trillion dollars a year…. $18,000,000,000,000.

Six percent of that (amount originally ours but now corporate’s) is roughly $1.1 trillion… At a 150 million of us working that averages out to an rough income loss of $7.333 per worker…

Would you be ok with $7,000 more per worker in your family?  $14,000 more PER YEAR in two-income families?

That is what happens when you move $1.1 trillion from Corporate profits over to employee income.

Let them scream Socialism on deaf ears. We know it won’t hurt them, it’s all bluff, because we know they were doing quite well when they had far less profits…

So if you don’t have enough to live well, don’t blame Mexicans.  Don’t blame those on SNAP.  Don’t blame Muslims. Don’t blame inner city inhabitants. Don’t blame Obama. Don’t blame the Supreme Court.  Don’t blame anyone except those who are entrusted with the cutting of the pie you are to get…

Right now, that is Republicans in Congress and those lobbyists handing them laws to be passed…

The only way it changes is for all to gang up and make the change… Only one candidate is unbought and offering to do that.

Math Behind Bernie

Obviously we can easily afford a minimum wage of $15 dollars an hour… Even without sweetening the pot with tax credits like we did on Obamacare, where we phase in a deduction to balance the cost of that extra initial expense, we could still easily afford it.

But if you personally were making $15 dollars an hour after college degrees and years of experience, and then some kid taking your fast food order was making the same as you, you might feel frustrated over how all the past years of your life spent in a Republican economy kept you down, when all you had to do, was strike and demand you should be paid just a little more…

Wage inflation does occur when jumping minimum wage from $8.25 to $15… It starts with those covered under the passage of the law and expands outward through each increase of income level….

This job, requires some math.

The number of America’s full time employees is around 121 million. with another 30 million working part time … 

For our rough calculation we will use 40 hours per full time and 30 hours for part time…

 

So just to see its effect, we will assume a calculated increase from the $8.15 to $15.00 knowing full well the impact will be less than what we predict, since many Americans are currently  already above the $8.25 level

So.  40 hours per week times the increase of $6.75 …is a gain in income per person of: $270 per week… YOW!!  And part time at 30 hours.  $6.75 times 30 equals…$202.50 extra per week.

(These numbers will be big.)
Across one year, full timers would yield $270 X 52 or $14, 040 additional dollars per year. Part timers get an increase of $10,530.

So at 121 million full time workers and 30 million part timers, the gross full timer impact would be $1.7 trillion a year…plus $315 billion for part time workers..to a total of $2.15 trillion a year.

Again, this is assuming the same expansion occurs in every single full time person who is now working, (of an additional $6.75 an hour)… which we all know is quite a stretch. (The actual cost will fall far below these theoreticals we are in the process of determining…)

Point being that if these inflated theoreticals are financially feasible, the actual plan will be as well. There will be no surprises.

So across America employers will have to spit up $2.15 trillion more a year in actual wages. Of course Social Security and Medicare taxed at 7.65 %  each for employee and for employer should also be considered.  Which means that an additional $160 billion should be added on to employer’s costs and deducted from employees benefit when measuring full impacts later   (For the record that would be a total impact of $2.3 trillion to employers and a total net gain of roughly $2 trillion to employees. ..)

Currently the personal income for America is close to $15 trillion dollars.. This expansion would add $2 trillion on top making America’s personal income total  now $17 trillion dollars.

The at-a-glance benefits.

• $2 trillion into the American retail economy per year.
• Boost of $260 billion into Social Security per year extending its life.
• Boost of $61 billion into Medicare per year.
• At an average income tax rate of 15%, boost of $315 billion with no rate changes

And next.

At what price.?

Across $6.160 trillion in Corporate profits per last four quarters we have data…. The price for this is that they lose 2 T’s, and get to keep 4….

At 4 trillion per four quarters, they would need to hold at the 1000 (billion) level or 1 Trillion per quarter.   We first reached that level in 2005. We dropped below in one quarter of the recession.

For most of our history, we have been underneath $4 trillion.. US Corporations only making $4 trillion isn’t going to hurt anyone. And as anyone can see from this chart, when corporate profits are lower, the middle class does better.  When they rise, the middle class does poorer.

Some may bring up the argument that with less profit there is less investment… The math discounts this… While profits were at 6 trillion per year, physical capital investment lagged at 3.1 billion. That can continue unabated at a level of 4 trillion.

Before discounting the loss of $2 trillion in profit, it is important to remember what profit is.  Profit is simply the money left over after all expenses have been paid. Profit is then divided into shares and goes out as dividends to all those who own shares of the corporation.  It is quite possible for a company to run well without making a profit.  Losing profit is not the same as going in the red. Losing profit just means you have less money after your expenses have all been met.. Going in the red means you can’t meet your expenses.

So in a nutshell, America can readily absorb raising minimum wage to 15 dollars an hour. It can even afford giving every American a $6.25 dollar an hour raise for doing what they do.

As for the gloom and doom prognostications of what this would do to the economy, the truth is it would only take us back to level existing as of 2005.

That is how much money that used to come to us…. now isn’t…  Which is why a lot of angry people are supporting Donald Trump …. If they knew enough about economics, they’s switch to Bernie Sanders.

I wish I could predict how much higher those corporate profits go when that $2 trillion hits the economic market place… but there is no precedent, so I can’t…. But in my option,  since we run with much lower profits whenever a depression or big recession hits, it makes greater sense to do it sometime before that moment, and therefore head it off by creating an explosion of real growth.
So not only is Bernies plan affordable, it is very much desired.

 

.

 

 

 

 

Politics 2016

As we approach the new year, the clowns will begin dropping out and all begin to take a serious view over who can be our next president.  By now a normal trend; it happens every four years.

The reason we have to put up with the clowns is  because across all of America, there is gross disenchantment over  the way things are.   A gross enchantment so huge, that unifies both the extreme right and extreme left into a larger classification.

These two opposite sides actually have a common denominator.  Both sides are both unhappy how the needs of real human beings are being trumped by those whom they have elected and trusted to serve them.

On the right it is the tea party types who are erroneously easy to dismiss as primitive forms of intelligence.  On the left is its those who exhale in triplicate just to hear themselves breathe, usually with complaints regarding how good programs are not good enough to their liking.

Or so each are characterized by the other side’s talk radio hosts…..

But in reality, both have a deep love of the America they grew up under and see it slipping away by the minute.  Both share the same vision that America needs to be great again, but simply differ on the approaches required to achieve that aim which can be characterized as such.  The left believes we need to change somethings in our system of governing; the right believes we have to change individual people one by one.

The common enemy in both parties surprisingly is the bloc of moderates spanning both parties who compromise too freely against their parties values and who seem  too prone to cater to business at the expense of individual constituent’s wishes and demands.  Rather bizarrely, we three parties, if you include this business class in the middle of both and only when two of the three agree, does anything get accomplished.

In Delaware this is played out in the opt out movement where the Governor (business party) used his veto and the head of the House of Representatives (business party) shows no sign of bringing it up to be overturned.. Enough votes (Dems and Repubs) are present to do so, just little procedural matter is all that is now boxing up the two wings wishes…’

Nationally the same scenario is being played out in that all the candidates are the same except one.  Only one candidate of either party is taking on corporate America.  All the rest are fortressed and supported by Corporate America marking all the differences actually existing between them as petty and insignificant when compared to the pressing needs at hand.

No matter who is elected, we can have no real change over the next four years unless that one who is different and from Vermont, wins.

So despite all the banter our main stream media is giving us, (whose staff is primarily and pathetically reduced to snooping on Twitter and putting that up as “real news”), the real question emerging as voters begin to look seriously, needs to be:  who will actually make that change that benefits me?

Only one.  Right now only one candidate’s platform can make the huge changes required to wean America off its penchant for developing profits, and turn America back to work on developing its people. Which is what the extremes of both right and left believe need to be done.

Because behind all the arguments about trade, abortions, shootings, and economics, the real solution to making your life better, is to put more money into your pocket as well as the pockets of the rest of the 99%.,…

Because you really aren’t politically free, unless you are also economically free. For unless you can quit that job you don’t like, can’t stand, or hate, and quickly find another one, you are not free.  If you have no choice but to work at that crumby job, you simply do not taste freedom.

Only one candidate’s platform will change that now;  it requires raising taxes on the one percent.

According to Fortune estimates, on this planet global households together have amassed over  $250 trillion in assets.   The one percent now owns 50% of that which translates into their ownership of $125 trillion in net worth. If this net worth were conservatively earning 7% per year in interest ($17.5 trillion), and the capital gains tax were raised to 50% marginal levels only on this select group, it would pump a lost $8.5 trillion back into the economy per year.

This is money that could be spent on combating global warming.  This is money that could be spent on making normal citizens earn more.  This is money that could be spent on ending hunger world wide. This is money that could rejuvenate cities providing great future for ones youth. This is money that could be spent on education.

And this money is absolutely free.

For the $7.5 trillion taxed and reinvested through governments around the world will offer (at minimum) a 2:1 rate of investment, meaning that the $7.5 trillion taxed and spent will generate a yield a $15 trillion return on that investment. Which since the wealthy own one half of all wealth, this means they get to re-pocket $7.5 trillion which they just gave up.  And if investment returns are higher, by ratios of 3, 4, 5,  even 10, they make out big time. Win, win, win.

Right now, only one person says he will do this.

Compared to this sea change, none of the other little things matter. If that yearly $7.5 trillion dollars through increased economic activity, is averaged out to all the 7.5 billion of this planets dwellers (of course it won’t be), it actually gives every single person a $1000 dollar increase of money they get to keep… They will see it in two ways; one they will see part of it in expenses going down and part of it in salaries going up.

Only one person across both parties fields has the wisdom take on Wall Street now knowing that it gets more expensive to do so by each hour.  OUT of all the candidates on both parties… ONLY ONE is not beholden to the interests of the top 1%.

You need to send him  money, whether you’re a Republican or Democrat. Both party’s networks are thoroughly tainted by corporate money. But one person isn’t…

In 2002 we gave the top one percent a loan from the American people which was to make us all wealthier over time.  They got their money, and kept it; we were polite and nice about asking for restitution. Apparently enough time has gone by, they think it is theres.  Meaning, it’s now past time we called back our loan which we originally gave to the top 1% via the Bush Tax Cuts. …

 

 

 

 

 

 

 

 

 

Opting Out Goes Deeper Than Just Education

If you are not a parent with children in school, you don’t know much about Opt-Out.  If you are a parent with children in school, you are very much aware about Opt-Out….

Essentially what is now called crony capitalism simply took over American education during the recession when money was very tight.  They immediately tried to classify all children into little corporate boxes which they designed to provide a continuous incoming revenue stream (for themselves)…

Parents knew that children should be learning more about what’s important in life and less about how to act like corporate schill,  and so parents looked for a way to stop it. Since all the corporate actions depended on having this one single test show beyond doubt that American children were more stupid they they really were, parents realized that if they could disable the credibility of these test results through not testing their children, then and only then would their requests have merit on boards overseeing education now staffed with crony capitalists.  Crony capitalists are those who preach the benefits of capitalism, but get their money from governmental handouts because of who they know in government.

The only way parents would get their wishes heard (they rightly concluded), was to refuse the test which if done on a massive scale would render the  published results untrustworthy, costing Capitalists lots of money, and therefore to the crony capitalists, the act of  fulfilling the parents’ demands would appear the cheaper option.

And at this point this article is going to leave the topic of education. Because I want to talk about the bigger issue at play here and it basically involves the future of every Americans’ economic freedom.

Throughout out years of history there is something uniquely America about the way we opt out.   Back when Britain’s Parliament decided that the Thirteen Colonies must pay some of their costly governance (Stamp Act), most Americans chose to opt out.  When the Brits relented and said, “ok, since you don’t drink very much tea, we’ll drop our tax on everything else”, the Americans opted out of drinking tea.

America was founded on opting out…

When the Pullman company said “no” to workers asking for a livable wage, workers opted out of working until those demands were met. Not willing to succumb to that loss of profits, the Pullman company reverted to violence to force people to work, and when that didn’t work, they convinced President Cleveland to force them back with a decree and he did.  They returned to work disappointed but the strike movement was born and would soon sweep across almost every industry.

It had to, because Opting Out is the only power (other than anarchy)people really have when things are stacked against them. Although  our nation is often deemed a representative democracy, under the surface enough representatives kow-tow to powerful interests, so the will of the powerful becomes the law of the land.

And that shuts the major door which working people have to implement their requests. As long as democracy continues as “majority rules”, you really don’t need “opt out” …  Instead, you opt not to return an official you despise and replace him with one more inclined to follow your wishes.

Now with Citizens United in play we are not even in the same world politically, as we were only one year into the Iraqi War (2004) .. As plainly seen by today’s Republican Party, very strange people as candidates are propped up by hidden money and it appears that with so much money, even without popular support weird candidates could still win.

So in those times when government and your bosses business are allied against YOU, you have to take non-governmental action to express your sentiments in a costly enough ways, so you too become part of the discussion….

Talk is cheap; money isn’t.

So if they don’t talk to you sincerely about your money, you hit them in their money…. You opt out of working for them. “Nope, not taking this today”

As Americans we tend by our altruistic nature to put other people’s interests above ours.  Not all of us, but most of us really do feel that way. It is why the rest of the world likes us. But the time to worry over your bosses profits before raising the prices for your services, has probably past…. Statistics show so much money in the top 1% came from YOU, because our Republican Congress this past decade let them run their hands through money which should have been yours.  You are working far shy of your income potential just because they are paying you much less for your services than they could easily afford. External factors have all been ruled out.  The  reason you are not seeing your income grow, is because THEY don’t want you to see your income grow.

The simplest way to get more money in today’s world, is to opt out of working for that boss, either permanently or on a strike. Every billionaire sports franchise has suffered a player strike in this century.  The owners first balk at not meeting players demands, and the players opt out of playing in their events.

No one can argue that NHL, NFL, MLB, or the NBA employees are impoverished. Players strike because the owners’ profits comes solely from their labor and as profits rise, they  certainly are entitled and deserve a cut in on the action. So do those who make cars.  So do those who work for airlines. So do those who cook your fast food. So do those who teach.

Strikes are simply about “cuts and percentages of profit”… as in do we cut you in on our huge profit, or on the other side, do we cut you out of your huge profits until you let us in on the action?

Today corporate overreach is so big, it is eating our public schools. Most likely that means it already owns your life…pinched between your bills and  your bosses demands.  But don’t you really deserve better?  Don’t you wish you were paid more for the amount of work you do? Why should you roll-over and resign yourself simply to settling for basic survival, instead of really enjoying your short time on this planet?  Don’t the rules businesses use against each other, apply to you too?  And the sad answer is that up to now, you DO settle for subsistence because you have been trained “not to rock the boat” or you’ll lose your job.  Your obligatory duty has been to keep the charade of normality continuing at your bosses pleasure, an action which plays directly into the hands of the 1%.

“Look at these fools, performing at the highest productivity America has ever seen and doing it for peanuts, while I’m beach-partying.”

For just a little bit more each week, you too could be partying… Which is why I think that the opt out movement is going national here in the US… jumping the confines of education to spread through out the workplace.

It is already prevalent among the millionaires.  They’ve been opting out of taxes for years now.  They opt out of regulations they don’t like implemented to protect the health of citizens.  They opt out of zonings they don’t like.  They opt out of environmental regulations. They opt out of following OSHA requirements.  They have been opting out a long time, which is why they are so afraid you will too.  They know its effectability.

Today, at no harm to your kid, you can opt him out of testing knowing full well that only then will changes get made. Once you succeed, apply that philosophy to the rest of your life…  HB 50 is nothing less than preserving YOUR right as an American Citizen, to opt out.  Imagine if asking for higher wages put you in jail.  It may one day. It has in corporate-run societies of the past.  But it will not happen here if your government preserves your basic American Right…. to opt out.

 

 

 

 

 

 

Questions Being Asked By No One: The Real American Tragedy

It is rather interesting that in our spirited Republican campaign we get very little substance.  Despite the discussion that Fox would outdo CNBC, most of what was asked of candidates simply didn’t concern me…  I speak for the silent America.

Here is what should be asked.  There is not a right or wrong answer yet.  They haven’t yet been tried.  But our nation is facing some consequential changes and many of us would like to know what our potential leaders would do to face them.

Granted there are both Republican and Democratic responses to these questions.  But America is being denied any discussion upon them… and has its attention diverted to personalities I think, for the sole purpose to keep these burning questions buried, hidden, and never shown the light of day….

1. How would you fix education in America.  What is your plan and how long do you think it will take before it begins to work?
2. Why are all the benefits of our work going to a few people? 
3. How do we restore democracy?
4. How do we return jobs to America from overseas without cutting wages to levels seen in countries like the Philippines or China?
5. How do we stop global warming? 
6. Businesses hire when demand increases, How do we increase demand?  
7. What is government’s role in a democracy when it comes to markets?
8. How do we reduce our prison population?
9. Who are the largest donors to your campaign and what do they want in return?
10. How do we prevent gerrymandering?
11. Estimates for peak oil range from its already happened to at the very latest 2060. What is your plan to deal with the end of oil?
12. Black people are 4 times more likely to be killed in police custody than white. What do we as a country need to be doing about this? 
13. How do we return the middle class? 
14. How do we create a better Internet?
15. Why are we outsourcing public schools? 
16. What do we do about “too big to fail” banks? 
17. How do we get the influence of big money out of our elections?
18. Big or little.  What is the perfect size for government in a dollar figure.  How big should it be in $$$$?

There may be more questions that are pertinent. These are a start… Now as Delawareans there is little you can do to affect the national outcome… But just take these questions to our state races and begin asking them there. Ask our future governor; ask our future Senator, ask our future Congressperson.  Print and take this along. If someone else asks a question you were intending, just switch and ask another off this list..

And because you held your representative accountable, we then begin to get the government we deserve.

One parting shot.

In past elections, question like this were asked by our media all the time.  They are purposefully or extremely negligent not to ask them now.

Sharpening Our Focus…….

There is general agreement today that American society is top heavy.  We live in Bizarro World‘s Soviet Russia.  Our Congress is semi-capitalist instead of Communist, but certainly it is not there to represent our interests, which are those of We, The People. Our elite (primarily our largest investors) control all of Congress’ perks while we wait in line for daily bread. Gigantic tax breaks for the wealthy are easily and quickly passed, and services for the rest of the 99% are cut to pay for them. Though we too are taxed (lightly), our money spent, does not come back to us; it rises to the top and stays there.

Ironically this is the exact opposite of what every American child learned about his country if he grew up in the years after WWII… while there still was a communist Russia.  Everything we learned was bad about Soviet Russia, is now happening to us to some degree…. Mass surveillance; rigged elections; rigged judicial systems; loss of our class wealth.

But the big difference we learned was that in America, power rose from the ground up.  We elected our representative and they were beholden to us. Today despite on how we vote, big money first vets and then funds our representatives. We go through Communist-like fake elections to put a rubber stamp on one of the two candidates selected, but long before we do, they were the ones who first picked who runs.

We can see this personified by our educational policy.  The communists of Russia had a state system to which if you did not comply, you were shot. We have something similar but instead our punishment is that our school doesn’t receive Federal funding unless comply with the Politburo’s wishes…

This was decreed from the top and is still in place despite our representatives voting 60 to 10 to support of “Opting Out”.

It all goes to show the now blatant view that whatever We, The People want, does not matter.

And that is a colossal failure of democracy. Democracy was simply a government designed to do whatever its people want; not the opposite of their desires.  .

If we want to change this, we need to take a page from our own founding fathers and create millions of small conversations across America regarding  the direction our future evolves out of the issues affecting us, and not be deflected towards flaws in our candidates’ personalities…

Currently our media is devoted entirely to personalities… Carson’s lying?  What does that have to do with how well we live 4 years from now?  Who is winning in Rubio’s and Jeb’s tit for tat?  Plenty of conversation but no information on how our lives will be better 4 years from now.  Tomorrow our media will use the most popular High School social analyses to determine who *(they think) won the debate tonight.

We all know who lost.  The American People… After all this is our country and we too need to be informed; not entertained, not tricked into voting for whom the top echelon wants to be in power..  Imagine a brain surgeon who didn’t know medicine?  Would we go there?  Imagine a plumber who didn’t know plumbing?  Or an electrician who didn’t know electricity?  Or a Math Teacher who didn’t know math?  Would we ask them to do a job for us?

But We, The People (over these past 2 decades which has see the corporatization of all big media), must make decisions as blindly as do High School classmates when voting for a Student Body President… Consequently the same methods that work in high school with uneducated voters are in play for our national elections.  As in who would we like to spend time with? Who acts the part of Chief Exec the best?  Who comes across as snooty or arrogant?   Who is the sexiest?   Our press discusses these; it does not touch on policy that affects Americans like:

• What result will we get if we raise taxes instead of lowering them?
• What is the cost of immigration if we do or don’t seal our  borders?
• What is the cost of not raising minimum wage versus raising minimum wage to $15/ hour?
• Should our property legally be taken because “friends” of politicians want it for development?
• Why is being spied on 24/7 bad for us all
• What will life be under the TPP if it gets implemented? What will it do for wages 15 years from now?

Those of us who modify public opinion need to be wary of the tricks big media is playing.  We need to call them out with facts or ideas that actually help people and therefore indirectly help corporations.  But getting bogged down in pie fights does a disservice to our readers as well as to the nation as a whole.

There is only so much time.  If our time is wasted on inconsequentals, things of consequence do not get done!  Which makes one believe they almost all our pie fights are there only for diversionary purposes…

The Red Cup controversy is only one example…  Everyone is discussing how inane the argument is.  So far in real life I have not found anyone out of roughly a 1000 people who thinks the Red Cup is anti-Christian.  Yet I have heard quite a few media references to it.  But by just bringing it up,  people are wasting time talking about Christmas faux-rage instead of questioning under which candidate they are most likely to get their boss to adequately raise their salary… And as we listen to the media gear up for tonight’s debates… the best explanation for how crazy they sound, is that they are not crazy and know exactly what they don’t want you to ask, and deflect you entirely from breeching that number one question regarding……..

Our salary increases. … That is really what is important.

There is only one national candidate now who is intent on making that happen.  There are a lot more on the local level.. Those are the contenders around whom your discussions need to center  Everything else in the political-media jungle is right now aimed at keeping you from seeing that..

Just A Couple Of Thoughts On Today: Where We Are…..

We are opting out of state mandated tests.

We are served up a spectacle of Presidential debaters living in bubbles saying nothing of substance.

Our media ignores the one person who is mouthing things of substance; basically the problems 99% of us face in balancing our paycheck against our expenses…. One is too low, the other is too high… They should be reversed.

Our Arctic Ice Cap is dangerously low, our entire global climate is reeling.

A seven billion person planet  freaks out and cannot handle a meager 1 million refugees from just 0.3% of its land mass.

The globe has never been richer…. EVER…. yet 99% of its people live in poverty.

Our own children are pawns in a grand scheme to eliminate public education and fix it so investors get rich off it.

Our corporate media simply doesn’t tell the truth anymore.  One has to turn to comedians to get real information.

A raspy brash loudmouth Jew with crazy hair calls out an Evangelist University of higher learning for not following the very laws laid down by Jesus Christ. An act very similar to that of another Jew a little under 2000 years ago who also challenged the religious authorities of HIS time.

==============================

That was today.  Meanwhile almost 50 million of our country lives in poverty, often while working too jobs… and everyone shrugs and thinks that’s ok.  The only thing worth discussing is Planned Parenthood and punishing Iran.

Is this really America then?  Are we no longer the land of opportunity emblazoned on the Statue of Liberty’s bottom?

Something has got to give, right?

It starts with you…. when you get mad enough to do something… that’s when it changes… 

You can… if you think about it…. start by going to Dover … 12:30 pm…. to protest the Smarter Balanced Assessment.   Because it is all connected… it is all about big money doing what it wants over your objections… It’s all about getting you out of their way….

Four Pillars Of Education

Child Safety —  Everything must be done to protect students and keep them safe and psychologically healthy.

Learning —  The brain learns on its own.  It learns what is most interesting to it.  If you put interesting books before it, it learns books. If you put interesting videos, it learns videos.  If an interesting student sits in front, it learns about that student. Learning cannot be measured except by a teacher who knows that child.

Social Engagement —  We are social animals…  We learn from each other.  The more different we are in a classroom, the more every one learns and a better and more stable society is seeded.  Schools need play time and time to allow socialization to naturally occur on its own.

Self confidence —  The sign of adult maturity is self confidence.  Confidence is built by becoming comfortable with one’s environment.  Those graduating should after 12 years be confident they have the tools they need to prosper as adults.

===========

These are the classical four pillars of education.  Originally formulated by the Greeks who themselves borrowed from many conquered civilizations.  In some ways they were wiser than us.  For just as we can learn and predict a computer game’s behavior by watching it over and over, they looked at human behavior over and over.   These are the four traits our founding fathers were given in their schooling.  These were the four traits the greatest generation grew strong upon.  These are what developed the Baby Boomers…

Ask yourself…. how does taking the Smarter Balanced Assessment augment and improve a student’s stature in any of these categories?

Now if teaching does instill them, and the Smarter Balanced takes away from teaching…. wouldn’t it make sense to get rid of the Smarter Balanced Assessment?

Paul Wellstone

Making students accountable for test scores works well on a bumper sticker, and it allows many politicians to look good by saying that they will not tolerate failure. But it represents a hollow promise. Far from improving education, high-stakes testing marks a major retreat from fairness, from accuracy, from quality, and from equity.  Paul Wellstone.. former US Senator; college professor

Things have changed little since 1994.