By Michael Gray
January 17, 2016
When people use the term Great Recession, they are playing into the charade laid out by Federal Reserve and the Treasury Department.
The years 2008 through 2015 should be known as the Great Fleecing.
During that time, the greatest transfer of wealth in the history of the world occurred. Some $4.5 trillion was given to Wall Street banks through its Quantitative Easing program, with the American people picking up the IOU.
“If liberals are angry about inequality, they should look no further than President Obama.”
This is the primary reason the US economy has not been able to recovery from the bank implosion of 2008.
Surely if you inject $4.5 trillion into the economy, you will get economic growth. You will get a 4% to 5% increase in Gross Domestic Product for at least a year or two.
Yet the Obama administration is the first two-term presidency that has not posted a 3% GDP growth on an annualized basis for 8 years. Even Franklin Delano Roosevelt posted 3% growth year during the Great Depression.
That’s because the $4.5 trillion was not given to any infrastructure program — it was given to banks, under the misguided notion that they needed the money to remain solvent. The banks promptly invested this money, which kept the stock market humming, but did nothing for jobs, wages or the GDP.
This was by design. The Fed could not allow the bank’s largesse to be circulated into the public for fear of rapid inflation.
The banks also funded company mergers, company debt offerings and stock buybacks. This activity kept the money sequestered and allowed a greater return for the banks. After all, they were getting free money to invest — there was no way to lose.
Who did this help? The 1%, and pretty much only the 1%.
These actions are the reasons the American middle class has been decimated and no longer makes up the majority of the population.
If liberals are angry about inequality, they should look no further than President Obama. He has done more to contribute to the gap between rich and poor than anyone.
The middle class has seen the wholesale export of good-paying jobs, while on the hook for crushing mortgages and higher taxes to pay down the growing US debt to fund the banks.
Is it any wonder that in all of the 3,007 US counties, parishes and territories just over 50% of the population in each county is on government assistance of some sort?
Now comes the punch line. After the Fed finally decided to stop the QE program, asset bubbles are growing weak and some say about to pop. The stock market is in correction mode — off more than 10% from its highs last year. After seven years of getting no interest on your savings, after little opportunity for job advancement and raises, now your 401(k) will take a hit anyway.
The US has “the strongest, most durable economy in the world,” Obama boasted. But only for the few.
(And, Hillary Clinton and Bernie Sanders wants to give us more Obama! I don’t think so …) jsk
Michael Gray is the Sunday Business Editor of The Post. His blog where a version of this article appeared is Gray’s Economy on WordPress.
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