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Sunday, July 8, 2012

Economic Stories of Relevance in Today's World -- July 8, 2012

The Biggest Financial Scandal In History? - The Economic Collapse Blog - We always knew that the financial markets were rigged, but this is getting ridiculous. It is now being alleged that 20 major banks have been systematically fixing global interest rates for years. Barclays has already been fined hundreds of millions of dollars for manipulating Libor (the London Inter Bank Offered Rate). But Barclays says that a whole bunch of other banks were doing this too. This is shaping up to be the biggest financial scandal in history, and criminal investigations have been launched on both sides of the Atlantic. What those investigations are likely to uncover could shake the financial markets to their very core. In the end, this scandal could absolutely devastate confidence in the global financial system and it could potentially bring down a number of major global banks. We have never seen anything quite like this before.                    What Is Libor?    As mentioned before, Libor is the London Inter Bank Offered Rate. A recent Washington Post article contained a pretty good explanation of what that means....




The Many Ways Banks Commit Criminal Fraud - Washington's Blog - July 4, 2012 - The Libor scandal seems to be waking people up to manipulation and fraud by the big banks. There are many other types of fraud they’ve engaged in as well …
Here is a partial list:
  • Engaging in mafia-style big-rigging fraud against local governments. See this, this and this
  • Bribing and bullying ratings agencies to inflate ratings on their risky investments
  • Pushing investments which they knew were terrible, and then betting against the same investments to make money for themselves. See this, this, this, this and this
  • Engaging in unlawful “Wash Trades” to manipulate asset prices. See this, this and this
  • Shaving money off of virtually every pension transaction they handled over the course of decades, stealing collectively billions of dollars from pensions worldwide. Details here, here, here, here, here, here, here, here, here, here, here andhere


Gloomy jobs report raises pressure on the Fed
- Economy Watch - MSNBC - Roland Jones - July 6, 2012 - Friday’s disappointing June jobs report confirms observers’ worst fears about the economic recovery: The employment market is still struggling and failing to put enough Americans back to work. The dour employment data are also likely to raise pressure on the Federal Reserve to do more to bolster the economy, and have negative implications for President Barack Obama's chances of re-election in November. The Labor Department said non-farm payrolls expanded by just 80,000 jobs in June, falling just short of forecasts for 90,000 jobs, but improving slightly on a revised reading of 77,000 jobs in May. The private sector expanded by only 84,000, while government jobs declined by 4,000......                          June’s 80,000-jobs number is well below the levels seen at the start of the year, and a monthly gain of between 125,000 and 150,000 jobs is needed just to keep up with the growth in the number of new people entering the workforce each month before even starting to whittle down the backlog of nearly 12.7 million unemployed Americans.  A pace of job creation that’s not strong enough to keep up with population growth is likely to raise pressure on President Obama, endangering his chances of reelection in November....                    Coupled with recent data that show a sharp decline in manufacturing, the dour payrolls report paints a gloomy picture of the U.S. economy that analysts say is likely to raise expectations that the Federal Reserve will initiate another massive bond-buying program known as “quantitative easing,” or QE, in which the Fed essentially prints money to buy long-term mortgage or Treasury bonds. The Fed next meets to decide on monetary policy July 31-Aug. 1.....





No Jobs: The Result of Wizard of Oz Economics - Zero Hedge - Econophile - July 7, 2012 - If there is one thing we should have learned from recent data is that you can "juice" the economy by inserting more money into it because when the money works its way through the economy, certain economic data will become more positive.             This is not a difficult concept to grasp. For example, if in a hypothetical economy there is a $1 trillion money supply and then it is increased by, say, 10%, assuming that new money is spent in economic activities, GDP will ultimately rise more or less by 10% because GDP measures spending. More money equals more spending, thus higher GDP.
During this phase one might see manufacturing and consumption increase and even employment grow. This happened with QE1 and 2. However, one might ask, if money stimulus actually revives real economic growth, why did we need QE2? Of course this is the flaw in the above argument. It doesn't work.                    These naive monetary theories don't work to create real growth, they just make the numbers go up ... temporarily. QE 1 or 2 did nothing to cure underlying economic problems or create lasting real growth. If QE had worked the economists at the Fed wouldn't be scratching their heads over the current negative economic data that has been pouring out recently. Today's unemployment report is a good example of this.



State panel wants to know if Duke misled it on merger
- Duke CEO’s testimony on Tuesday could spur new merger conditions - Charlotte Observer - July 7, 2012 - State law gives the seven-member commission (one seat is vacant) authority to “rescind, alter or amend any order or decision” it has made. The commission approved the $32 billion merger on June 29.                    It also decides whether to grant rate increases – both of Duke’s operating companies in the Carolinas plan to seek one this year – and at some point will be asked to let the two companies become one.
While it’s unlikely to try to dismantle a merger that took 18 months across a half-dozen jurisdictions to approve, observers say the commission could use its leverage to extract new conditions if it doesn’t like Rogers’ explanation...                               Rogers could testify that he’s the wrong man to ask – it was the board’s decision, not his. He could say that any company reserves the right to change management.                           Johnson’s severance agreement says neither he nor Duke can publicly go beyond a Tuesday press release that said the two parted ways under “mutual agreement.” That doesn’t prevent either from “providing truthful disclosures as required by applicable law or legal process,” it adds.                              Duke also faces a demand from N.C. Attorney General Roy Cooper to turn over by July 31 board minutes and other documents from the time the merger was announced. Cooper made the demand after Standard & Poor’s placed Duke on a credit watch last week, after Johnson’s resignation. Moody’s, another rating service, affirmed its outlook for Duke.
On Friday Duke’s stock price fell 3.4 percent, its biggest decline since Aug. 10, Bloomberg News reported.....                        Speculation abounds about why Johnson resigned, or was pushed out, at 58. He left with up to $44.7 million in severance, pension and other benefits, according to securities filings and Duke’s calculations.                         Among the reasons floated is that Progress’ crippled Crystal River nuclear plant in Florida will cost much more to fix than the $1.3 billion Progress has estimated. Its outlook has dimmed since the merger was announced, and it’s still not known how much insurers will cover.

Debt Jubilee (Quantitative Easing ) for the Public







Saturday, July 7, 2012

Hal Row's Gracious words about CEG and the Petition Drive

Members of the Citizens for Equity in Government (CEG) would like to thank WHKY radio host Hal Row for his comments this past Thursday morning in relation to the petition drive for the Referendum to change the current electoral process for Hickory's City Council.

Hal had gracious words about those who went out and accrued the 2,707 signatures that secured the rights of the Citizens of Hickory to decide how future Hickory City Council Elections will be decided. A right that was not afforded to the Citizens of Hickory when the system was changed in 1967 and a right that the current Council was unwilling to afford without the procurement of this certified petition.

We all remember and thank Hal and WHKY for having the educational interview on about the petition drive on his First Talk program back last December. Without that interview, the success of the petition drive campaign most likely doesn't happen. Hal's interview, and the details that were shared that morning, generated a lot of buzz at that time and helped put this campaign on the radar, which helped obtain hundreds of signatures. Of course the holidays and the onset of Winter slowed progress some what over the next few months, but Hal's interview was always something to point to when addressing the legitimacy of this campaign.

In that interview, Billy Sudderth gives his reasoning for the formation of the Citizens for Equity in Government and Joe Brannock was able to discuss how the current voting structure came into existence. Joe continues with the history lesson of what happened back in the 1960s that has led us to where we are today and Billy talks about some of the political maneuvering that took place at that time. Billy talks about disenfranchisement and the lack of participation that he believes is a result of the current system.

Joe talked about perceptions and how he is white, Republican and young and Billy is black, a senior, and a Democrat and we need to cast off the labels to be able to move things forward. Joe talks about how 4 people on Hickory Council in 1967 made a decision that shut out citizen participation. There is currently no entry point into the pipeline of civic service. Joe interjects that council people can represent the City of Hickory at the same time that they directly represent their ward. Citizens of Hickory don't vote on members of Congress from other districts and yet these representatives represent the welfare of the entire State of North Carolina -- and the United States.

In Hal's comments from this past Thursday, he says that what we have done with this petition drive is patriotic. He says that we didn't just complain that we went out and did something to redress our grievances. He makes a point that he isn't saying that he supports Ward Specific Voting or how others should vote, but the petition process is good democracy in action. I am biased, but I couldn't agree more.

The next step will be when the City sets the date of the election and begins writing the language of the ballot. On July 3rd, David Hood, the chairman of the Catawba County Board of Elections, asked the City of Hickory to include members of Citizens for Equity in Government in this process, but added that the City was under no obligation to do so. He also asked that the City come forth with the date for the election sooner rather than later.

The CEG has asked to participate in this process, since the CEG is responsible for the petition and feels therefore that it has a role in shepherding its guidance. Everyone certainly hopes that the City of Hickory will do the right and above board thing and not play games with this issue. The ball is in the City's court and it is their Olive Branch to extend or not extend. It will tell us a lot about how the CEG will have to proceed with this process in the upcoming days. Will this be a fair process or will we see rancor? We live in interesting times!



Thursday, July 5, 2012

Ward Specific Voting Petition Certification - Catawba County Board of Elections Vote - July 3, 2012

The following is the audio of the Catawba County Board of Elections meeting of July 3, 2012. During this meeting the Hickory Ward Specific voting petition was certified. According to people I have spoken with this is the first successful petition to be brought to a referendum in the history of Catawba County, therefore this is a historic event in the history of Catawba County.

This is serious business and the City of Hickory must act upon the will of the people. There will be a special election upon this referendum. This election cannot take place until a minimum of 60 days have passed and at a maximum of 120 days after the certification and delivery of documents to the City of Hickory. City Manager Mick Berry was present and accepted and signed the document. Two more issues are that this election must take place at least 30 days prior to any Statewide or Federal Elections and the City must provide 45 days notice prior to the scheduled date of the special election, but this 45 days does not include the early voting period that is a prerequisite to any election in the State of North Carolina and is to be held two weeks prior to the scheduled election date.

In the presentation, the issue is discussed and approved from the beginning to the 6:20 mark of the audio and then the Board moves onto other business and then comes back to the discussion of the issue at the 24:05 mark and discusses the election process and other matters involving the referendum until adjournment at around the 38:45 mark. So in essence the full discussion of this issue takes a little over 20 minutes.



Wednesday, July 4, 2012

A Day of Independence to Celebrate - July 4, 2012

Yesterday we celebrated people participating in their governance with the success of the Petition Drive to bring adequate representation back to the people of Hickory.

Today we celebrate our nation's 236th birthday and enjoy the effort it took to achieve success in our local petition campaign and appreciate those who were at the forefront of getting the numbers and the history of our forebearers who made the ability for the common man to have a voice possible. Tomorrow we renew the American spirit of Democracy and go back to work to deliver the final goal.

God Bless America!!!

This Land is Your Land




The Star Spangled Banner


Tuesday, July 3, 2012

Ward Voting Petition Drive Successful on to the Election - July 3, 2012

Today history was made in Hickory and Catawba County. At 8:15am the Catawba County Election Board gathered for their regular meeting, but this meeting was special. At this meeting the Catawba County Election Board reviewed and summarily certified the Petition presented by the Citizens for Equity in Government and now we will proceed towards the special election on this issue.

This election cannot take place until a minimum of 60 days have passed and at a maximum of 120 days after the certification and delivery of documents to the City of Hickory. City Manager Mick Berry was present and accepted and signed the document. Two more issues are that this election must take place at least 30 days prior to any Statewide or Federal Elections and the City must provide 45 days notice prior to the scheduled date of the special election, but this 45 days does not include the early voting period that is a prerequisite to any election held in the State of North Carolina.

This is the game changer that I have been addressing over the past couple of years. Although this is a milestone, it is not a victory. We move forward with Humble Responsibility for the citizenry of Hickory.




CITIZENS FOR EQUITY IN GOVERNMENT COMPLETES PETITION DRIVE :
TRUE WARD ELECTIONS FOR HICKORY CITY COUNCIL TO GO ON BALLOT


Hickory , NC - July 3, 2012 - While not planned for today, it is appropriate that the Catawba County Board of Elections certified the Petition for Fair Representation on the eve of Independence Day. Over the past year, Citizens for Equity in Government (CEG) gathered the signatures of 2,707 registered voters, 6% more than required to call for a referendum election to restore Hickory City Council elections from the current modified-at-large system to a true ward system as it was in the original city charter.

“It’s a real step toward improving representative democracy in Hickory city council races,” says CEG spokesperson Billy Sudderth. “The Petition for Fair Representation is about a change in the process of electing representatives that will give the voters of every ward a stronger voice in who represents them on city council.”

In 1967, the Hickory city council voted to change from a true ward system to a modified “at-large” (or blended system) for city council. This means that each of the six wards chooses two candidates in primaries and then those two candidates run city-wide for a seat on the council to represent the ward.

CEG and the 2700+ petition signers say that this at-large system goes against the concept of fair representation by allowing voters from outside a ward to influence the outcome of elections in wards where they do not live. The true ward system promotes fair representation by promoting close ties between ward representatives and constituents, providing immediate service and direct accountability to voters, and eliminating voting blocks.

The pure ward system has been shown to increase citizen participation both in voting and in running for office. Under the current at large system voters feel disenfranchised because they know they are not the ones who are choosing their own ward representative. Candidates are forced to fund expensive city-wide campaigns, which puts the possibility of running for office out of the reach of many potential candidates. And, polls must be open for all six wards for every city-council race under the current system; polls in the pure ward system would be open for only half the wards each election cycle which would cut government spending.

A City-Wide, Non-Partisan, Volunteer Effort
Volunteers with CEG made phone calls, knocked on doors, worked polls, and had tables at events to get signatures on the Petition for Fair Representation. No city resources have been used in mounting the petition. “It’s been an educational process,” Sudderth says. “Our canvassers estimate that more than 80% of the people who were approached and understood the petition signed it.” No organized citizen group has come out to say they oppose the change. Widespread geographical and non-partisan support of the petition is reflected in the signatures of Unaffiliated, Republican, Libertarian and Democratic voters from all six wards and every precinct in City of Hickory.

The 2,707 signatures supporting the true-ward system represent more voter support than any member of the Hickory City Council has gotten in the past 10 years except for the 2005 election where the Lowe's issue was at stake.

Next Steps – Education and A Vote
The certified petition is the first step in restoring the true ward electoral system. The certified petition calls for City of Hickory to hold a referendum election where all registered voters in the City of Hickory can vote for or against the change. Or, just as City Council made the change to a modified-at-large system with their vote in 1967, the current City Council could restore the true ward system with their majority vote saving city taxpayers $47,501, the cost of a city-wide election.

“Citizens for Equity is calling on the city to move forward as soon as possible,” says Sudderth. “We need to get the referendum on the ballot and let the people decide.” A good first step, he adds, would be to put together a four-person team, two from the City Council and two from CEG, to develop the language for the ballot.

“As for us,” Sudderth concludes, “CEG will continue to educate voters on how the true ward system is more fair and more representative.” To learn more about the Petition for Fair Representation and the true-ward system, citizens of Hickory are invited to a roundtable discussion Wednesday, July 11 at 6:00 pm at Ridgeview Library, 706 1st Street SW Hickory , NC 28602.

CEG is a grassroots organization engaging in economic and social justice, educational and cultural efforts in the Hickory area. The CEG was founded to work on behalf of disenfranchised citizens in the Hickory area. CEG’s goal is to ensure participation and representation in the establishment of public policy. Contact Citizens for Equity in Government at 828-308-4669.

1961 -- A lesson in Hickory's History

1967 - How we got where we are today

The History of At-Large voting in Hickory - The HDR articles and Council Minutes Documents

Hal Row's First Talk - CEG discussion about Ward Specific Voting - The Interview

Help Bring Fair Representation Back to the City of Hickory

Mayor Wright - Hal Row - Ward Specific Elections

Monday, July 2, 2012

Tick Tock, Tick Tock, Tick Tock....

Countdown Initiated... Close and Initiate your visors and permit O2 flow... T-minus 11 hours... Confirmed Go...  Go for Main Engine Start...

Sunday, July 1, 2012

Economic Stories of Relevance in Today's World -- July 1, 2012

JP Morgan Trading Loss May Reach $9 Billion - New York Times - By JESSICA SILVER-GREENBERG and SUSANNE CRAIG - June 28, 2012 - Losses on JPMorgan Chase’s bungled trade could total as much as $9 billion, far exceeding earlier public estimates, according to people who have been briefed on the situation.                           When Jamie Dimon, the bank’s chief executive, announced in May that the bank had lost $2 billion in a bet on credit derivatives, he estimated that losses could double within the next few quarters. But the red ink has been mounting in recent weeks, as the bank has been unwinding its positions, according to interviews with current and former traders and executives at the bank who asked not to be named because of investigations into the bank.                 The bank’s exit from its money-losing trade is happening faster than many expected. JPMorgan previously said it hoped to clear its position by early next year; now it is already out of more than half of the trade and may be completely free this year.



Former Obama Advisor: 'Fiscal Cliff' Plunge Likely - CNBC - Eamon Javers - June 26, 2012 - ...In an interview, Bernstein said no matter who wins the Presidency this fall, the fiscal cliff may be unavoidable. “If you actually play out the difference scenarios here, the President wins, Romney wins — it’s hard to see that we don’t go off this fiscal cliff,” Bernstein said. “Because I don’t see how this compromise gets made.”...            That said, Bernstein argues that the fiscal cliff may not be the economic nightmare scenario many pundits have described. Bernstein thinks it’s possible to go over the cliff early in 2013, but not for long, and that Washington will come to a deal once the pain kicks in....                 “If we can reverse it in a matter of two or three weeks — and there is a scenario in which that can happen — that would do a lot less damage to the economy than if we stayed over the cliff,” he said. Bernstein is currently a fellow at the Center on Budget and Policy Priorities and a CNBC contributor.                      The fiscal cliff is a series of politically imposed deadlines on tax and spending policy that are all set to hit at the same time at the end of 2012. Taken together, many analysts argue that a massive decrease in federal spending and increase in federal taxation could paralyze the economy just as it is struggling to creep out of recession.                     Here’s what’s slated to end by the end of the year:                         The US government is expected to hit the debt ceiling of $16.394 trillion by the end of 2012, although Treasury has ways of stretching this that could push that deadline into the early part of 2013.                    Speaker Boehner has said he’ll only support extending the debt limit again if there are spending cuts put in place that are larger than the debt increase itself. That, plus Democrats’ insistence on increased taxes, could force a rerun of last year’s damaging debt ceiling debate.                      The Bush tax cuts are slated to expire by the end of this year, too. Democrats and the President want to extend them only for those making less than $250,000 per year, while Republicans would like to extend the entire set of cuts. In the context of the debt debate, this will be a tricky one to resolve.                        Remember the “sequester?” That’s the term for automatic spending cuts set to kick in at the end of this year because last year’s super committee was unable to reach a spending deal. The cuts total about $1.2 trillion, and they start January 2, split between defense and domestic spending and causing an estimated 15 percent across the board cut at the Pentagon.                            Throw in a payroll tax holiday expiration and emergency unemployment benefits ending at the end of the year as well, and we’re looking at a very tough New Year’s Eve in Washington.


U.S. Economic Confidence Continues to Slide - Economic confidence declines to -26, lowest since late January - Gallup - Jenny Marlar - June 26, 2012 - U.S. economic confidence last week was hardest hit June 19-21, when it fell to -28, but it bounced back to -25 over the weekend. The midweek slide may have resulted from the anticipated Moody's downgrade of several major banks and one of the worst trading days of the year on Thursday. However, the market rallied back on Friday, which may have led to the weekend improvement in confidence.                     Gallup's Economic Confidence Index consists of two measures -- one assessing current economic conditions and the other assessing the nation's economic outlook. Americans' perceptions of current economic conditions worsened to -31, down four from the previous week, with 44% saying the economy is poor and 13% saying it is excellent or good. Attitudes about the economic outlook were down marginally last week, at -21.




Mortgage applications fell last week: MBA - Reuters - June 27, 2012 - Reporting by Anna Louie Sussman; Editing by Diane Craft - Applications for U.S. home mortgages fell last week as refinancing applications for government loans slowed, an industry group said on Wednesday.                  The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell 7.1 percent in the week ended June 22.                    The MBA's seasonally adjusted index of refinancing applications decreased by 8.3 percent, while the gauge of loan requests for home purchases, a leading indicator of home sales, fell by 1.4 percent.                  The refinance share of total mortgage activity fell to 79 percent of applications from more than 81 percent the week before. Michael Fratantoni, MBA's vice president of research and economics, attributed the decline to a fall-off in refinance applications for government-backed loans, which had soared the previous week.               "The large swings in activity were due to the implementation of FHA's new premiums on streamline refinances, and borrowers timing their application to lower their premiums," he said in a statement.


Wash Trading by High-Frequency Firms Said to Face U.S. Scrutiny - Bloomberg - Joshua Gallu and Silla Brush - Jun 22, 2012 - High-frequency trading firms are drawing scrutiny from U.S. regulators seeking evidence that they may be distorting market prices by conducting transactions with themselves, said two people with knowledge of the matter.                      So-called wash trades, in which a party buys a contract from itself, could be executed inadvertently by firms with multiple algorithms active in the same stock or derivative, said the people, who requested anonymity because the review isn’t public. Such trades, which can alter the price of shares if they are executed above or below market rates, would be illegal if deemed intentional efforts to manipulate stocks.                    The Securities and Exchange Commission and Commodity Futures Trading Commission have sharpened their focus on high- frequency and algorithmic trading since May 6, 2010, when about $862 billion was erased from stock values in 20 minutes before share prices recovered from the plunge. Regulators have expressed concern that some firms and electronic exchanges don’t have sufficient controls to prevent a range of events -- from improper trades to programming glitches -- that could roil markets even when there is no wrongdoing.                    High-frequency trading, in which computer algorithms are used to buy and sell stocks in fractions of a second, accounts for more than half of equity trading volume. Getco LLC and Citadel LLC, both based in Chicago, and New York-based Virtu Financial LLC are among the biggest automated-trading firms.


17 Reasons To Be EXTREMELY Concerned About The Second Half Of 2012 - The Economic Collapse Blog - What is the second half of 2012 going to bring? Are things going to get even worse than they are right now? Unfortunately, that appears more likely with each passing day. I will admit that I am extremely concerned about the second half of 2012. Historically, a financial crisis is much more likely to begin in the fall than during any other season of the year. Just think about it. The stock market crash of 1929 happened in the fall. "Black Monday" happened on October 19th, 1987. The financial crisis of 2008 started in the fall. There just seems to be something about the fall that brings out the worst in the financial markets. But of course there is not a stock market crash every year. So are there specific reasons why we should be extremely concerned about what is coming this year? Yes, there are. The ingredients for a "perfect storm" are slowly coming together, and in the months ahead we could very well see the next wave of the economic collapse strike. Sadly, we have never even come close to recovering from the last recession, and this next crisis might end up being even more painful than the last one.                      The following are 17 reasons to be extremely concerned about the second half of 2012....       #1 Historical Trends...       #2 JP Morgan...       #3 Derivatives...   #4 LEAP/E2020 Warning...     #5 Increasing Pessimism...   #6 Spain...   #7 Italy...   #8 Greece...   #9 Cyprus...   #10 Germany...    #11 Bank Runs...    #12 Preparations For The Collapse Of The Eurozone...    #13 Global Lending Is Slowing Down...   #14 Sophisticated Cyber Attacks On Banks...   #15 U.S. Municipal Bankruptcies...   #16 The Obamacare Decision...   #17 The U.S. Election...


Why the Middle Class Is Doomed - Of Two minds - Charles Hugh Smith - April 17, 2012 - The dwindling middle class, squeezed by higher taxes and costs, is losing its political voice.             The middle class is doomed by some very basic dynamics. Economic historian David Hackett Fischer laid out the fundamental dynamic in his book The Great Wave: Price Revolutions and the Rhythm of History.               By assembling price and wage data stretching back hundreds of years, Fischer found that cycles of economic growth spawned population growth, an expanding number of workers entering the market economy (as opposed to the non-market subsistence economy) and a demand-driven expansion of essential commodities such as grain and energy (wood, coal, oil, etc.).                In the initial phase, wages rise and commodity prices remain stable as supplies of essential goods expand and the demand for labor pushes up wages.                 But this virtuous cycle reverses when the supply of essentials no longer keeps pace with rising population and demand: the price of essentials begin an inexorable rise even as an oversupply of labor drives down wages.

Declining Wages


Income by Age Bracket




 
What all this reveals is that the middle class has lost its political power. Roughly 40% of all households receive a check or equivalent from the Federal government, while at the top Power Elite crony capitalists skim capital gains and pay an average of 17% of all income.               The 100 million dependents on the Federal government (Central State) vote to support their share of the largesse, regardless of the consequences to future generations, and the Power Elite crony capitalists buy political protection for their cartels and financialization scams. The dwindling middle class ends up paying most of the taxes even as their percentage of the population falls to the point that their political voice is drowned out by more numerous dependents and Elites that both favor the Status Quo. 


We Are Living in a ‘Modern-Day Depression’: David Rosenberg - Yahoo Finance - By Aaron Task | Daily Ticker – Mon, Jun 25, 2012