Busted: Bankers and The Global Economy

July 24, 2010

U.S. Worries Over Deflation

The nation has a nasty case of stagnation, fueled by significant employment issues and rising defaults. Prices are falling while most consumers resist buying. When deflation begins and prices fall, it seems like a good thing. Then, lower prices cut into business profits which results in trimming payrolls. This further undermines buying power, which leads to lower profits, fewer jobs and lower wages. All this results in economic contraction.

With all the cutbacks, buyers that have the funds wait for better deals through even lower prices, which magnifies deflation. As a result, the nation plunges into a downward economic spiral that is hard to escape. This is exactly what the United States faces.

The nation’s capital is feeling the guilt as they look at other in dismay about the rising deficit and inflation, even though they advertise to the world that inflation doesn’t exist here. Economists around the world see great potential for deflation of the dollar, which already would be the case, were it not for declining currencies across the globe.

The statistics say it all. Consumer prices have declined each month for the last three months, putting inflation above last year. They claim that the core inflation rate is at a 44 year low at less than one percent. So why are they worried? The Federal Reserve likes to see an inflation rate of 3% because this puts more money in their corporate pockets.

Private economists and financial experts are more concerned. Some of them see the possibility of deflation at more than fifty percent. This is compounded by unemployment, lack of production and lower spending.

Should deflation occur, the central bank has the tools to reverse it according to Ben Bernanke, even though the Federal Reserve has interest rates at historical lows and has pumped trillions into the financial system. The books have been cooked baby, to the loss of the United States. Bernanke claims the U.S. economy is more vibrant and productive than Japan’s was in the 90s. The difference is supposed to be that Japan’s labor face was actually declining, while the States has plenty of labor.

In my words, there are plenty of financially-broken and impoverished Americans to take advantage of, with the hope of restoring the economy on their collective backs. Wall Street and multinationals aren’t suffering beyond the losses of jobs they incurred during the recession. Let’s face facts, they didn’t suffer much at all. Their employees did. That’s the way it is.

The little guy at the bottom, so far, is the one that has truly paid for the recession and the remainder of its fallout. They are ones that will continue to pay.

February 24, 2010

U.S. Consumer Confidence Remains Low Despite Projected Optimism

The measure of U.S. consumer confidence fell in February to the lowest level since April 2009 as the outlook for jobs diminished. This is an obvious sign spending will be slow “as the economy recovers.” The banking community is gridlocked and recent short-term gains in the business community indicate an upturn. Meanwhile, a real recovery depends on consumers. Why?

Since consumer spending accounts for approximately 70 percent of overall U.S. economic activity depressed consumer confidence will undoubtedly lead to less consumer spending and sluggish growth in the economy. The economy that I refer to is the real economy as opposed to the Wall Street economy. The fact remains that if consumers have a lack of confidence in the economy, they are not likely to engage in spending sprees if they can and they certainly won’t make major purchases like appliances, houses and automobiles.

Despite media hype and the government spending, Americans are not seeing any real change in the economy. Politics seems to continually pin its hopes on Wall Street and stock market as a measure of confidence. Wall Street, now absorbed into the banking system, continues to function within the same dynamics as before the meltdown. Bundling securities continues unabated even though this, in large measure, has resulted in substantial reverses in resolving bank debt and cleaning up the meltdown mess. Lawmakers remain weak willed even though hands have been figuratively slapped for financial illiteracy by the Federal Reserve, the new kingpin of financial law.

This is no different from allowing the “Big 3” Credit Tracking Agencies to run the show in managing consumer credit, a definite conflict of interest since these businesses and the Federal Reserve have so much to gain from the system in place. This is illustrative as to why so little has been accomplished. The system has its’ hands in its’ own pockets. Corporations have adopted functions of government as lines continue to blur. The system grows with little benefit to anyone as corruption further stagnates the system. Politics is working in the same way to involve health care on a larger level. The government may have a system of checks and balances, but the founders of the country did not count on the corporate oligarchy now in place.

February 5, 2008

Feeling the Silence

bernankenigelparry.jpgThe silence is noticeable. The U.S. Federal Reserve has been very quiet except for making measured changes. There is no effort to apply publicity. You could almost hear a pin drop if it were not for the din of the press. “The Reserve Bank of Australia, the Bank of England and the European Central Bank are all due to meet and dealers will be focusing on whether they are concerned about the severity of the U.S. slowdown and whether (more…)

January 15, 2008

The Prophecy of Paul Volcker

Former Federal Reserve chief Paul Volcker foretold upcoming events at the second annual summit of the Stanford Institute for Economic Policy Research. In his keynote speech he warned that the nation is facing “huge imbalances and risks”.

“Altogether, the circumstances seem as dangerous and intractable as I can remember.”

“Boomers are spending like there is no tomorrow.”

“Homeownership has become a vehicle for borrowing and leveraging as much as a source of financial security.”

“I come now to the heart of the problem (more…)

September 10, 2007

Fed Announces Risks and Outlook for 2007

Filed under: banking, federal reserve, government, money — Tags: , , , , , , , — digitaleconomy @ 10:50 am

“As everyone in this room knows, financial markets have been front and center in recent discussions about the economy. The FOMC noted on August 17 that financial market conditions deteriorated last month and that the associated tighter credit conditions and increased uncertainty have the potential to restrain economic growth going forward. Indeed, at this point, housing demand seems likely to be crimped further by a marked reduction in the availability of mortgages, and consumer and business spending also could be damped as a consequence of the recent financial turmoil. In light of these events, we will need to make the best possible real-time judgments about the extent to which the recent developments in financial markets are likely to affect economic activity in the period ahead.”
~ Fed Governor Fredrich Mishkin, September 10, 2007

Outlook and Risks for the U.S. Economy

March 25, 2007

American Express Plans RFID for Marketing

Filed under: banking, government, money, RFID, security — Tags: , , , , , , , , — digitaleconomy @ 4:03 pm

U.S. Patent Application #20050038718 details the use of RFID readers that American Express calls “consumer trackers” to closely watch people in stores. The idea is that RFID-embedded objects carried by the shopper would emit a “consumer identification signal” when queried by consumer tracker devices in the environment. Businesses would pick up this signal and use it to identify shoppers, track their movements, and observe their behavior.

U.S. Patent & Trademark Office File

Here are the main features of the patent for the tracking system:

“…consumer interface [configured to…provide a consumer identity signal to a radio frequency identification reader via a radio frequency signal] may also collect and transmit time and location information (more…)

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