I hate to get off on a rant....

I hear liberals constantly bemoan the fact that inequality exists in society due to the fact that the wealthy in the country continue to grow wealthier at an increasing rate while the wage earning public’s real wages have been stagnant for a great while. What’s the answer? Why get government involved of course by increasing the minimum wage and such other nonsense.

They can never see that the real reason that a privileged few reap vast amounts of money while others fall behind is due to the fact that government, contrary to what liberals would have us believe, has a vested interest in making sure that corporations are protected from competition and awarded monopolies in certain sectors of the American economy. The banking industry, petroleum, defense and pharmaceuticals just to name a few are a virtual protectorate of the government. With high government positions and advisory panels being stacked with industry insiders such as the former CEO of Goldman Sachs Henry Paulson being the Secretary of the Treasury.

The unholy alliance between government and certain big business in the United States creates the conditions that allow the gigantic disparities between the haves and have nots to become further exacerbated each year. The villain du jour this Christmas season was the executives working for the banking industry who received eight figure bonuses.

What does one expect when the fed has been creating liquidity in the market place ever since the tech bubble burst in 2000? The business of finance(ing), i.e. writing and selling mortgages has been in a bull market since interests rates were brought down by the Federal reserve beginning in 2000. The majority of mortgages get bundled up and sold to the J.P. Morgans and Goldman Sachs of the world who then sell them into the international market as mortgage backed securities, or derivatives. The windfalls earned by investment houses recently are directly attributable to the rise in speculation brought on by the federal reserves low interest rates.

Now that it seems the air has begun to leak out of the housing bubble leaving millions of Americans holding mortgages greater than the actual value of their home, or in car lingo, “upside down.” Wild speculation drove the housing market up past sustainable levels, leaving middle America holding the bag.

Even if the derivatives markets crash due to the underlying assets being over valued and many mortgage lenders and banks go under, which has begun to happen already, who gets hurt? Certainly not Sachs CEO Lloyd Blankfein who received a $53 million bonus this year.

No it’s the people on the bottom who will suffer, the roofer, the electrician, the carpenter, the bricklayer. And then, because of the public outcry, politicians will seize a greater portion of the economy, but this time it will be health care and insurance companies that will receive the spoils of government policies and their CEO’s will have windfall bonuses until they fall out of favor with the public and the cycle will start all over again. No matter who’s in charge, if you aren’t connected with the privileged class or a Washington insider, you will schlep harder and for less money. Because whether its democrats or republicans in charge the government must inflate the currency to pay its debts, and the subsequent inflation is like a thief picking your pocket. Convert your money to something else and move before it’s too late!